KUALA LUMPUR (Reuters) - The head of Malaysia's anti-graft body will step down on August 1, the agency said on Thursday, more than two years before the scheduled end of a term that included an investigation of Prime Minister Najib Razak.

The revelations of the investigation, first reported by the Wall Street Journal last year, have shaken investors in Southeast Asia's third-biggest economy and dented confidence in Najib's ruling coalition.

Abu Kassim Mohamed, the chief commissioner of the Malaysian Anti-Corruption Commission (MACC), asked for his contract to be terminated earlier than expected, the agency said in a statement.

"There was no pressure from any parties towards the decision made by Abu Kassim to shorten his contract," it said, dismissing speculation in domestic media that pressure from the prime minister's office might have prompted the resignation.

The prime minister's office did not immediately respond to a request from Reuters seeking comment.

Under Abu Kassim, who took on his role in the beginning of 2010, the anti-graft body began investigations into allegations of graft and financial mismanagement at state fund 1Malaysia Development Berhad (1MDB) and the transfer of 2.6 billion ringgit ($647.09 million) to Najib's bank accounts.

Malaysia's attorney-general cleared Najib of any criminal offences or corruption in January. Najib has denied any wrongdoing and said he did not take any money for personal gain.

Abu Kassim's contract was to have run until Dec 4, 2018, the antigraft body said, adding that the request to cut short his tenure followed an offer to be a visiting expert at the International Anti-Corruption Academy in Austria.

"The request was made after I got the opportunity to improve Malaysia and MACC's name and international standing," Abu Kassim told reporters, adding that he would stay in the civil service until mandatory retirement in 2020.

A second vacancy is coming up as his deputy, Shukri Abdull, will retire on Oct. 3, Abu Kassim added, in a video of the news conference released by the agency.

Najib was widely criticized last year after the government replaced Attorney General Abdul Gani Patail, who had led investigations into 1MDB, with Mohamed Apandi Ali. It cited Patail's failing health for the change ahead of his retirement.

(Reporting by A. Ananthalakshmi and Rozanna Latiff; Editing by Clarence Fernandez)