The government will honour all payments on debt raised by insolvent state fund 1Malaysia Development Berhad (1MDB), even though it is unhappy about money missing from the fund, said Finance minister Lim Guan Eng.
Malaysian stocks closed the session 1.2 percent higher, but the week 3.1 percent lower, the biggest since September 2015, on concerns of worrying amounts of debts left behind by the previous government.
Public Bank Bhd and Tenaga Nasional were the biggest boost with gains of 2.3 percent and 1.9 percent, respectively.
Among other Southeast Asian stock markets, Indonesian shares gave up early gains to close 0.5 percent higher, marking their fourth session of gains.
Financials accounted for most of the gains with Bank Negara Indonesia (Persero) rising 3.9 percent and Bank Central Asia climbing 0.5 percent.
Bank Indonesia's newly sworn-in governor promised on Thursday to focus on stabilising the rupiah in the near term and to be "more pre-emptive" and ahead of the curve on monetary settings.
Investors welcomed the statement after weeks of weakness in local assets on the back of capital flight fears.
The key Jakarta stock index closed the week 3.3 percent higher, the biggest since the week ended Dec. 30, 2016.
An index of the country's 45 most liquid stocks was up 0.5 percent on Friday.
Singapore shares closed 0.4 percent lower after data released earlier in the day showed that industrial production rose at a slower-than-expected pace in April month-on-month.
For the week, Singapore stocks declined 0.5 percent, in their second weekly drop.
Philippine shares closed 0.1 percent lower, dragged by financial and real estate stocks.
The peso fell to a fresh 12-year low after the central bank on Thursday announced its second cut in banks' reserve requirement ratio in three months.
The Philippine key stock index shed 0.3 percent this week.
Vietnam shares closed 2.2 percent lower and Thai stocks ended 0.5 percent higher.