Friday, February 06, 2009


.......Just out! [Link]. I was just reading the report and it says Temasek has a 40% exposure to banks. This is the 1st time I heard of that. A 40% exposure to banks is close to an exposure of $74B. A number of major banks - BoA, Citigroup, etc have slumped 70-90%....I can't imagine the losses.

A series of Reuters reports linked to this


Okay we are to believe that Ho Ching is leaving although Temasek performed well and her stepping down is not due to losses.
SINGAPORE, Feb 6 (Reuters) - Singapore state investor Temasek Holdings [TEM.UL] said on Friday its chief executive Ho Ching will step down and be replaced by former BHP Billiton CEO Chip Goodyear on Oct. 1.Ho Ching, wife of Prime Minister Lee Hsien Loong, joined Temasek as a director in January 2002 and has been CEO since January 2004."The team has already embarked on a different stance since mid-2007, and has begun to review its long-term plans under different scenarios prompted by the economic downturn," Chairman S. Dhanabalan said at a media briefing."If we are to bring in new leadership, it would be just as good a time as any to involve a new leader in this review."Goodyear, 51, stepped down as CEO of BHP Billiton in January 2007. He joined Temasek's board on Sunday.Temasek, which had S$185 billion ($123.2 billion) in assets as at March 2008, has been hit hard due to its 40 percent exposure to banks that have slumped in value due to the global financial crisis.The sovereign wealth fund's key investments include 28 percent of DBS Group (DBSM.SI), just under a fifth of Standard Chartered Bank (STAN.L) and about 3.8 percent of Bank of America (BoA) (BAC.N) following BoA's takeover of Merrill Lynch.Temasek's $5 billion plus investment in Merrill alone has resulted in a loss of more than $2 billion. [ID:nBNG274629] (Reporting by Kevin Lim and Saeed Azhar, Editing by Ian Geoghegan)


Anonymous said...

I clapped my hands when I saw the headlines.

Anonymous said...

Oh NO!!!
This is terrible news!

Any1 remembers what happened the last few times she "stepped down" :-S

Anonymous said...

Why did'nt they state the reason for her stepping down when she's still relatively "young" at 50+ yrs old only.

Anonymous said...

hmmm... stepping down amid the troubles??? or being fired :P

yamizi said...

what can the new ceo do?

Anonymous said...

Sylvia Lim was right!

There are no current reserves to draw on - that's is wht we needed the second key!

All gone!

Taishan said...

zopAnother angmoh taking over.
Don't they have any locals that fits the job description?
Pathetic !

Anonymous said...

Of course not link to TH performance, everyone knows that Ho Ching step down is due to the recent cold weather in Hong Kong. ;-)

Anonymous said...

Fired? Who dared to fire her? She probably lost her nerves after the disastrous venture into the troubled banks.

DB10 said...

To Anon 4.59pm,

What happened the last few times she stepped down?

Anonymous said...

bMaybe she will be "elected" to be the next president of Singapore?

Anonymous said...

I still remember the day when Jeffery Skilling resigned from his position as the chief executive of Enron in 2001. 3 months later the former energy giant collapsed.

Anonymous said...

Maybe she will be retained as mentor CEO

Onlooker said...

OMG. This is for real?
The beginning of the crumbling of the Ivory Towers.

cardboard collector said...

40% in banks! Holy Mackerel! Holy Poo! Holy Cow! Is my CPF safe?

Anonymous said...

Our money is all gone but as was said before we must grateful to them in the first place.

Anonymous said...

where have a our SM and MM gone now. They need to assure the people.

Anonymous said...

my goodness, exluding those sum from GIC, 40% exposure to bank????

mismanaged the nation's money and left without a word!!!

Anonymous said...

Who is going to step down from GIC?

dishwasher said...

The new CEO will make 2009 a Goodyear.

Anonymous said...

If there is any one to be blamed for the massive losses, it should be the entire compliant and malleable cabinet and Dhanabalan. It is inconceivable that she made all the decisions without seeking advice and approvals from the very top. If that is the case, then she would have left long ago.

Definitely more is yet to come, as I suspect this is just the tip of the iceberg. Likely scenario is that we do not have much in reserves after all. They might have tried to salvage the losses and poured good money after the bad. Let's see.

Anonymous said...

These super duper elites really have foresight!

Months after LHL had relinquished his position as Finance Minister cum PM in Oct last year, thousands of Sgians were hit with the Lehman Bros mini-bonds fiasco. And poor Tarman was left to hold the fort as a result of LHL's loosening up of regulations towards a more "let the buyer beware" policy. By having such a policy, even dubious bad investment tools that M'sia wouldnt allow to be sold to their public was peddled to Sgians.

After so many years of being the CEO of Temasek Holdings, LHL's wife's decision to leave may forebode greater troubles ahead. Especially when so much of Temaseks's investments overseas recently have turned sour.

I hope we will not be left to face with another mega fiasco.

Akan datang. The real show will happen after she leaves.

Anonymous said...

in the first place, there are already possible conflicts of interest and character - imagine a politician trying to play investment manager, is bound to doom because a politician ego is always big, never say die attitude, always optimistic while a good investment manager knows when to sell, know when to stand still and be stupid fool, know when is to be pessimistic?

Anonymous said...

Don't be too happy. She may reincarnate as the PM.

Anonymous said...

Hmmm, Jackson Tai left DBS to join his family in the US, then came the mini bombs...somebody else left his position for Tharman to take his place, then we dig into reserves...anything happened after Lee Hsien Yang left SingTel?

Anonymous said...

Micropolis went belly up after she stepped down. What else anyone?

Anonymous said...

First her husband left the Finance.

Months later, now, her turn to step-down.

Next the old man will leave the chair.

Hmmmmmmmmm, i smell fishes.

Anonymous said...

we still hav a 4 trillion dollars economy ok? dun play play hor...

Deity Of Cannon said...

This is from Lwee Took U's hated source; Oh Chinx is being prep for Prezidency.

Nahfan will step down and you know the rest.......

OH! So Saucy!
Husband and Wifey side by side......OMG!
Plime Minstah and Prez, both Hubbie and Wifey!

I leave that to your imagination!

Anonymous said...

Don't worry. Ho Ching will continue to draw billions and millions.

Just like Pinkish clown pass his shit as Finance Minister to Tharma when he knows the extent of the shit he created. Now Tharma is paid to do all the explaining so that Pinky can move on and get away.

Same with his wife, passing all the shit to a puppet foreigner CEO that they can fire any time. Just need a temporary scapegoat to put all the blame.

Anonymous said...

Lucky, this news is very depressing. Once again we cannot find a single talent in Singapore worthy enough to manage our biggest conglomerate? Sigh. I would rather a Singaporean screw up and waste our money than a foreign angmoh doing the same. RookieLim

DanielXX said...

Why doesn't Lee Hsien Yang take over? I'd rather that than give our state reserves to a foreigner.

Our country so many talent and yet cannot find a local one to handle our state funds? Speaks volumes of things here.

So finally heads are rolling. It has to. Accountability is what democracy is all about. I'm glad today has shown that a bit of democracy exists here after all.

Anonymous said...

she is stepping down to give birth. sg got future.

Anonymous said...

Accountability? what accountability? didn't you read the lines " - TEMASEK CHAIRMAN SAYS CHANGE OF LEADERSHIP NOT LINKED TO INVESTMENT LOSSES ."

She also "resigned" or "step down" not SACKED!! Probably got herself $$$ job credit$$$ for "stepping down".

Even if she get the sack...why did it take billions of $$$of "paper" loss before she gets the chop...

Anonymous said...

The new CEO was formerly from the resource sector (BHP) in Australia. Now the strategy is not banks anymore but the mineral sector, eg iron ore, gold, oil etc. This sector won't lost one, always got demand. Good choice!

Anonymous said...

It says Temasek's exposure is 40%. I wonder what is GIC's exposure?

Bernie Madoff said...

Just do the numbers, 40% is invested in financials. Use XLF as a proxy for that sector, and its value today is 33% of its average value from 05 to 07. So they lost 67% of 40% of $185B = $49.6B.

What abt the rest of the portfolio? Most of it would be in stocks, which fell 35% last year, but a fair chunk could be in real estate, or in private equity funds, which fared even worse than the stock market. But they said they 'outperformed' the market. So let's take their word and assume the losses are 'only' 30% = 0.3 x 0.6 x 185 = 33.3B.

Total Losses = $82.9B.

I think that is in USD. And that's more than one year's GDP for Singapore.

Singapore, you lost more of your honest citizens' money than the amount I ripped off from Wall Street fatcats!

Anonymous said...

If she is not fired, then why now? I think the government is over-confident and this will cause the collapse of Singapore. The $20 job credit scheme is just a cover-up for all their mistake in wrong investment which led to a loss of $90 billion.

Anonymous said...

Few things I can deduce from this shocking news (correct me if i m wrong):
1) The "quitting" is not planned by Ho Ching as she "has no plan what to do next".
2) The Lee family has lost a key position which manage the national reserve
3) The Board of Directors of Temasek "dare to" vote her out, thou everyone in the board knows who is her father-in-law

Finally something makes sense is happening in sg. I feel the sky is going to change... The family is not "royal" after all. Maybe there is hope in sg.

Very Worried & Angry said...

for ho ching to step down due to internal pressure rather than external (from citizens), this is very ominous.

i'm very sure something humongous is not right at temasek.

Anonymous said...

I say she will be put in charge of another government linked organisation. Anyone want to take a bet against that?

Anonymous said...

Has anyone ever ask how did the power generating companies which belonged to a stats board fall into the hands of Temasek and does the govt has any right to hand it over to Temasek or for the matter Changi Airport.

Can anyone provide me an answer?

Ghost said...

When the company is in trouble, the boss get the sack. Ho Ching is the boss, so she got the sack. I also don't think this is planned, but with the trouble Temasek is in, it's not surprising.

Anonymous said...

Ho Ching as I recall in the media is the most powerful woman in the world, even more powerful than the secretary of state of US. How is it that she's fired! Impossible to believe. Has Singapore really lost 90 billion USD.
Are there any money left in the kitty. Anybody knows, pls enlighten us.

Anonymous said...

Bernie Madoff,

Good work,best guess work.

Now if possible,would you analysis the possible paper loss of GIC.

Info was given by chairman of GIC,Dr Tony Tan in The Straits Times,on 2 Feb,2009,P.A4

Dr Tan disclosed that GIC had portfolio value of US$300 billion(S$450 billion) invested in non-Singapore market.

Dr Tony Tan also declared that of the S$450 billion fund, a very high percentage of 7% was in cash at the end of 2008,and declared it very satisfying.

Thank you.

Anonymous said...

Dear Bernie Madoff,

6 Feb 2009,4.09am

The report on Dr Tony Tan disclosure is below:Thank you so much

Feb 2, 2009
GIC generates returns

By Alvin Foo

DAVOS: The Government of Singapore Investment Corporation (GIC) is confident that it will be able to continue generating reasonable returns for the country's reserves despite a tougher global investment climate.
But the investment manager must continue to manage its investments carefully and cautiously, diversify its portfolio intelligently and manage risks well, said its deputy chairman and executive director Tony Tan.

Dr Tan told The Straits Times that GIC will be able to deliver the sustainable investment returns which will enable the Government to 'prudently draw on Singapore's reserves for budgetary purposes over the long term'.

He said on the sidelines of the World Economic Forum in Davos last Friday: 'This is the best contribution that GIC can make towards ensuring that Singapore continues to progress and prosper.'

Elaborating on GIC's key strengths, he cited three factors that give GIC the edge amid the increased market volatility and financial turmoil.

The first is a long-term investment horizon of '20 years or more', which allows GIC, with an estimated portfolio of US$300 billion (S$450 billion), to ride out fluctuations in the value of its investments over several economic and market cycles.

Dr Tan added that this has become very important since it is the long-term expected real return of the Government's portfolio which will determine how much the Government can draw on reserves.

The Government recently revised the Constitution to enable it to draw on more of the returns from investing its reserves.

The second strength of GIC is its diversified portfolio, which includes many asset classes from equities and bonds to real estate, private equity and commodities.

GIC invests in both the developed markets of the United States and Europe, as well as developing markets in Asia and other parts of the world.

Dr Tan said: 'This diversified portfolio as reflected in GIC's asset allocation strategy enables GIC to work towards a better optimal balance between risk and reward.'

He reiterated GIC's investment aim, which is to ensure minimal losses rather than trying for maximum returns. 'Our philosophy is to look after the downside, and the upside will look after itself.'

Finally, GIC has built up a 'deep pool of expertise' in its staff, who are able to operate in many countries and markets.

Elsewhere in the 30-minute interview, Dr Tan noted the positive feedback the recent Singapore Budget received from business leaders in Davos, and revealed that GIC's cash position has increased.

He also noted that top bankers and heads of large corporations he met were 'very impressed' with the Budget.

They said it reflected a plan not only to weather the present recession, but also one to help Singapore emerge as a stronger, more resilient nation in the future. And all this without the need to borrow.

'This is the vital difference which sets Singapore apart from all the other countries I've talked to. It's the one thing which impressed bankers and businessmen,' he said.

Dr Tan also revealed that GIC's cash reserves have risen above 7 per cent of its portfolio in the second half of last year, having cut back on exposure to equities since mid-2007. He said its current portfolio is 'underweighted in equities, overweighted in cash and cash equivalents'.

Asked about the general sentiment of delegates regarding the crisis, he said: 'Everybody's worried. This is the most serious economic and financial crisis the world has seen in the last 50 years...nobody knows how long the recession is going to last.'

But he said that if the recent slew of fiscal and monetary measures work, recovery could come later this year with the end of recession by 2010.

Anonymous said...


I am quite surprised when I read the following paragraph given by Dr Tony Tan.

"The first is a long-term investment horizon of '20 years or more', which allows GIC, with an estimated portfolio of US$300 billion (S$450 billion), to ride out fluctuations in the value of its investments over several economic and market cycles."
I think you are trained in Economics,so perhaps you can help with my question.

Unlike oil producing countries,such as Saudi,Norway,Russia,etc,who sell their oil overseas and earn the foreign exchange,I believe that Spore main sources of foreign exchange are trade surplus and foreign invesment.

So when foreigners invest in Singapore,they remit the foreign excahnge and MAS would create an equivaleny amount of S$ and hence the foreign exchange with MAS becomes our foreign reserve.

If that is the case,wouldnt it be very risky if we use the foreign reserve to invest in very high risk investment such as those bankrupty Western what GIC is doing now?

Appreciate yr comments and feedback,thank you.

Il Mango said...

I don't want to depress you, but I think you can say good bye to your cpf money.
No one will ever know how much money Temasek has really lost...Your money, if you think abou it...

Anonymous said...

Cash as an asset class in a portfolio can increase in percentage simply because the valuation of the other asset classes such as equity, fixed income, private equity, real estate and commodities have decline in value. Which they did over the last two years. So how much of the increase is really due to prescient anticipation of the drop in financial markets and timely exit from them? Will we ever get to know?. All the fudge ( like giving long term returns for Temasek's portfolio ) and non answers to other simple questions really infuriates me. If mistakes have been made just admit them. Then we can move on!

Anonymous said...

Question I have is: Will she get a golden parachute (ie. a handsome severance package)? If so, do S'poreans have a right to know how much? Do you think it's okay to ask this in the main stream media (ie. ST Forum)?

Can someone advise please... thanks.

Anonymous said...


"Temasek Chairman S. Dhanabalan said 55-year-old Ho's decision to step down was not linked to performance and it was too early to determine if investments made in the last two years would lose money in the long term."

Oh really? Chairman of Temasek does not even know how Temasek is performing when anyone at the click of a button knows that the publicly known USD9 billions that Temasek poured into Merrill Lynch & Barclay in late 2007 is now only worth 25% of their value then :


And when you take into account GIC USD19 billion investment in UBS and Citigroup, the result is even more scary. Citigroup is now only 13% of the value a year ago, when GIC went in like that crazy old fool.

In all SGD30 billions or more has gone down the drain. But that is a small figure given that, as Lucky told us, 40% of Temasek funds are invested in banks.

But all the top executives of Temasek and GIC, like Chairman Dhanabalan of Temasek will tell us it is too early to tell what is going on lah. That's a gag order all the way up.

After all we are not as well informed as them whaaat ... and must wait to be told may be some 10 years time how those wonderful "long-term" investments will be doing ... except right now Citigroup and the other 3 banks are already going to the dogs.

Anonymous said...

if you read the ST today, it conveniently sidesteps the 40% exposure fact, simultaneously massively understating the losses temasek is facing as "paper losses" "running in the billions". there is a big difference between <10bil and TENS of billions... god only knows how much. it's a very good spin, kudos to the ST.

Anonymous said...

To downplay losses gahmen and media say "paper losses". But dont paper losses translate into real losses? I don't know but when investors lose money in equities, the statement on their investment reports are as real as any bank deposit figures.

Anyway, at least now Temasek has paper losses to console itself. With Citigroup split into 2 companies and at only 13% of its value 1 year back, very soon when that company completely goes bust like Lehman Brothers, there wont even be any paper losses to show but one big "telur", ZERO that is.

Anonymous said...


"Cash as an asset class in a portfolio can increase in percentage simply because the valuation of the other asset classes such as equity, fixed income, private equity, real estate and commodities have decline in value. Which they did over the last two years."

But according to Dr Tony Tan,7% cash in GIC's S$450 billion portfolio investment is only S$31.5 billion,hardly a significant amount.I wonder why Dr Tony Tan intented on making a big show out of this?

Anonymous said...

(But according to Dr Tony Tan,7% cash in GIC's S$450 billion portfolio investment is only S$31.5 billion,hardly a significant amount.I wonder why Dr Tony Tan intented on making a big show out of this0

It was $ $450 bio, perhaps two years ago. Now I think it is just between $100 and$199 bio based on the msm reports on MM's speech over CNY ( no need to worry Singaporeans, we still have enough reserves to see us through ). So 7% in absolute $ is now even less. Go figure...

Anonymous said...

around 2 years ago, when i heard that LXY is stepping down from singtel. i find it surprising and couldn't understand y. like the present episode now, it is also reported that LXY has "no immediate plans" similar to Ho Ching.

Few months after LXY's sudden resignation, a press release from singtel announces that singtel's investment in Optus Australia has resulted in 5.5b losses.

It seems that the same is happening now, when something goes VERY wrong, close allies of the Lees will retreat from position. then kept safe from the fire without any investigation.

Anonymous said...

"paper losses" only apply to hade currency. The one that you can a dollar for billions of hade currency to burn for use in netherland.
But is Singapore a hell country ?

If it is indeed "paper losses", there will no need to sell national assets !

Only fools believe the concept of "paper losses" but then it could be real because dollar note is made up of paper too.

Anonymous said...

Ho Ching obviously with the blessings of the Lees is trying to wriggle out of the mess she created in Temasek.

Think there will be no record of what happened under her charge?

Other CEOs not appointed through political nepotism might well get away scot-free through such a method. But not so simple for such politically-connected high flyers.

Even 10, 20 years down the road a new political leadership no longer chummy with the Lees or forced by societal pressure can open up a can of worms for her and Lees.

So, not so fast, wily ones.

Why dictators never learn from history from around the world?

Anonymous said...

But, but, what if by then they have already scooted away with all our money or lost all of it, then how? Expose can of worms also no use.

Anonymous said...

Some people are saying that the change in CEO is sudden and unexpected.

But if you think deeply about it, we were already told about it years ago.

Remember we were told "More .... Goodyear is coming !"

Anonymous said...

I thought LKY said we had an excess of 300 billion in reserves last year?
How come LKY says that its 100 billion now?

"He told them of the 1960s and 1970s, when there was only S$100 million (RM240 million) in reserves, the country faced separation from Malaysia and had to deal with “Konfrontasi” from Indonesia. In contrast, he said there is more than S$100 billion in the reserves now."

What happened to the missing 200 billion?

Anonymous said...

My family got this theory ...

All that shopping spree done by Ho Ching is to facilitate siphoning off monies to the LEE account somewhere in Switzerland.

That's why the need to have people guessing only.

I think the Lee family and the Chen Shui Bian family about the same. Greed no enough types.

Anonymous said...

i dun know how much of these happened becos the leadership in Temasek comprises of investment greenies like the former CDF Ng Yat Chung...and previously another general Ong Boon wonders how Temasek recruits!!!

Anonymous said...

you lesser mortals.... what do u know, talk somemore... no more blogging for u...

Anonymous said...

no wonder sm goh chok tong say...
MORE Goodyears..
they found one now..
he does have a very good forsight.

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