SE Asia Stocks-Malaysia extends falls to 4th day; Indonesia up 2 pct

* Malaysia index hits lowest in 5 months

* Indonesia climbs for third session

* Singapore Q1 GDP rises at faster pace than estimated

By Karthika Suresh Namboothiri

May 24 (Reuters) - Malaysian stocks fell for a fourth

straight session on Thursday as a widening probe over corruption

linked to the previous government and continued capital outflows

soured investor sentiment, while Indonesia soared for the third

day running.

The Malaysian index slid 2 percent to 1,768.18, its

lowest level in five months.

Prime Minister Mahathir Mohamad vowed to cut the national

debt of 1 trillion ringgit ($250 billion) during his first

cabinet meeting this term, and widened an investigation into the

scandal-hit state fund 1Malaysia Development Berhad (1MDB).

"The political malaise is weakening MYR (ringgit) and that

usually triggers some outflow. But I also believe the local

markets are caught up in the risk aversion," said Stephen Innes,

head of trading APAC at Oanda.

"Foreign money is not finding the situation very reassuring

even more so with the stronger USD and higher U.S. yields making

servicing Malaysia's foreign debt even that much more

expensive," he added.

Financials dragged, with Malayan Banking Bhd

falling as much as 7.6 percent, and Public Bank Bhd

dropping 2.8 percent.

Indonesian shares rose as much as 2.1 percent with

Bank Central Asia climbing 2.3 percent, while

automotive retailer Astra International rose 3.2

percent.

News reports of the government's plan to disburse its Eid

holiday bonus of 36 trillion rupiah (up from 18 trillion rupiah

last year and 23 trillion rupiah originally budgeted for this

year) is likely to push the Jakarta index up further, Trimegah

Securities said in a note.

Increased bonuses to civil servants is seen as a way for the

government to support consumption in Indonesia, which has been

sluggish.

The country's index of 45 most liquid stocks was

up 2.6 percent.

Singapore edged up 0.3 percent, led by industrials

and banks.

Lender Oversea-Chinese Banking Corp climbed 1.3

percent, while Singapore Airlines was 2.1 percent

higher.

The city-state's economy grew at a slightly faster pace in

the first quarter than initially estimated, as factory activity

remained robust.

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SOUTHEAST ASIAN STOCK MARKETS AS AT 0347 GMT

Change on the day

Market Current Previous close Pct Move

Singapore 3509.33 3496.27 0.37

Bangkok 1746.2 1753.6 -0.42

Manila 7581.61 7560.47 0.28

Jakarta 5916.736 5792.001 2.15

Kuala Lumpur 1788.49 1804.25 -0.87

Ho Chi Minh 991.26 988.94 0.23

Change on year

Market Current End 2017 Pct Move

Singapore 3509.33 3402.92 3.13

Bangkok 1746.2 1753.71 -0.43

Manila 7581.61 8558.42 -11.41

Jakarta 5916.736 6355.654 -6.91

Kuala Lumpur 1788.49 1796.81 -0.46

Ho Chi Minh 991.26 984.24 0.71

(Reporting by Karthika Suresh Namboothiri; additional reporting

by Fransiska Nangoy in Jakarta; Editing by Sunil Nair)