Yesterday Citigroup and Bank of America stocks fell further - both stocks fell 14% in one day. The window for selling these stocks is fast closing. The US Treasury announced "stress tests" that will be conducted on banks to apply "the appropriate therapy"[Link]. For banks such as Bank of America and Citigroup which are insolvent zombies, shareholders will wiped out in all solutions now being considered by the US Treasury.
"Citi to me is still the biggest risk position out there....".
Singapore not only made bad decisions investing in these banks when most of the investment community knew that they were in trouble and extremely risky, they continuously denied that mistakes were made and insisted that they are long term investments (link, link). They missed all the chances of mitigating their losses and they will probably miss last chance to exit from these bad investments. There is little doubt that a lot of credibility will be lost when these investments get wiped out.
There is a need for greater transparency (if not complete transparency) and reform in Temasek/GIC. If they had done it earlier when billions were lost in Shin Corp, we might have prevented the devastating losses in those banks. If they don't do it now, we will be seeing unnecessary loss of taxpayers' money in the future.