“We are certainly not happy with the negative wealth added in March last year, as well as March this year,” says Ho Ching. (See Bloomberg report below.) Read the transcripts of Ho Ching’s speech here.
SINGAPORE, July 29 – Singapore state investor Temasek said on Wednesday its portfolio had fallen by S$40 billion as of end-March 2009 from a year ago.
“In our Temasek Review last year, we reported an annual value-at-risk of almost S$40 billion last March. This meant a 16 percent probability for our portfolio value to drop more than S$40 billion by March this year. Indeed, it has turned out to be so, and more,” CEO Ho Ching said in a speech.
Temasek had S$185 billion in assets as of end-March 2008, which fell to S$127 billion as of November 2008. Ho did not give the exact portfolio level.
This was the first public comment by Ho, also the wife of Prime Minister Lee Hsien Loong, after Temasek said last week that Charles “Chip” Goodyear will not become CEO due to differences over strategy.
Ho said Temasek would continue to look at internal and external candidates for her replacement.
- Reuters.
The following report is by Bloomberg:
Temasek May Let Public Invest, Retain ‘Family Jewels’ .
July 29 (Bloomberg) – Temasek Holdings Pte, reeling from the aborted appointment of Charles “Chip” Goodyear, said the value of its assets slumped by more than S$40 billion ($27.7 billion) and that Singapore’s sovereign fund may allow public investment for the first time.
The company will seek “sophisticated co-investors” and won’t sell the “family jewels” for short-term gains, Chief Executive Officer Ho Ching, the wife of Singapore’s Prime Minister Lee Hsien Loong, said in a speech today in Singapore. Goodyear’s departure was “unfortunate” and Temasek will continue to review its succession plans, she added.
The appointment of Temasek’s first foreign CEO collapsed a week ago because of differences over strategy, raising concerns over transparency andmanagement control after losses on Merrill Lynch & Co. and other financial investments dragged down its performance last year.
“Allowing the public to invest in Temasek would increase the state-run fund’s transparency,” said Francis Lun, general manager of Fulbright Securities Ltd. in Hong Kong. “It will increase pressure on their managers to avoid investment mistakes.”
The fund predicted last year a 16 percent probability that the value of itsassets may drop by more than S$40 billion in the 12 months ended March, Ho said. That figure announced today suggests an improvement from the S$58 billion loss in value for Temasek’s assets the fund reported between April and November.
Temasek’s Assets
The state-owned investment company’s assets were valued at S$127 billion as of Nov. 30, compared with S$185 billion at the end of March last year, the Ministry of Finance said in February.
“We are certainly not happy with the negative wealth added in March last year, as well as March this year,” Ho said. The fund defines “wealth added” as returns above risk-adjusted cost of capital.
Temasek would consider creating one more group of stakeholders over the long term, and may invite the public to “co-invest” with the company, Ho, 56, said. It may seek “sophisticated investors” in five to eight years and retail investors in the next eight to 10 years, she added.
“It is important to test this over at least one market cycle during the next five to eight years,” she said. “If this pilot is successful, we may then consider a co-investment platform for retail investors in perhaps eight to 10 years’ time.”
‘Pretty Huge’
Temasek could attract some “pretty huge investments,” though it will have to balance the interests of shareholders and the state, said David Cohen, director of Asian economic forecasting at Action Economics in Singapore.
“They’ll be subject to greater disclosure and corporate governance but that’s going to be the case going forward anyway with or without external investors,” Cohen said.
Ho, who was due to step down Oct. 1, said the fund will act to enhance value over as long as 30 years and will not sell stakes “for divestment’s sake.”
“We don’t intend to raid the larder nor sell the family jewels for short-term gains,” she said. “We will jealously guard our interest and will invest, rationalize, consolidate or divest where it makes sense, where we can achieve clear, sustainable value.”
Expansion Overseas
Temasek was founded in 1974 to foster development of the island’s banks, airlines and ports. Ho drove an expansion outside Singapore and increased financial assets to 40 percent with stakes in Merrill Lynch, Barclays Plc and Standard Chartered Plc.
Temasek is the biggest shareholder in five of Singapore’s 10 biggest publicly traded companies by market value, including Singapore Telecommunications Ltd., Southeast Asia’s biggest phone company, and DBS Group Holdings Ltd., the region’s largest bank by assets.
Ho said it was “unfortunate” that Goodyear didn’t take the top job, and that the succession review continues for her replacement.
“I just want to reaffirm that the decision was both mutual and amicable,” Ho said. “ We continue to hold Chip in very high regard for his professionalism and his integrity.”
Ho said financial services investments will still form part of Temasek’s core holdings. Temasek is still “fairly comfortable” in the financial services industry, she said.
Loss on Stake Sale
The fund, in the first quarter, sold its 3.8 percent stake in Bank of America Corp., which bought Merrill Lynch, at a loss that may have totaled $4.6 billion. Temasek sold its stake in London-based Barclays at a loss in December and January, Reuters reported on June 3, citing people familiar with the matter.
Temasek is “very comfortable” with its investment in Asia, and the long-term potential returns from the region remains strong, Ho said. Temasek has stakes in India’s ICICI Bank Ltd., China Construction Bank Corp. and lenders in Indonesia, South Korea and Pakistan.
Ho said the company’s senior management have most of their compensation incentives deferred between three years and 12 years.
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ha ha ha forget it.. who wants to say yes to dragon lady all the time?
What does a veteran journalist such as B.N Balji gotta do with Temasek’s loss?
no wonder the Goodyear punchek
Sigh…guess they’ll need to install more CCTVs…..
are they blaming good year?
coz ho ching was not responsible for temasek during this time.
The mother of Charities..dun play play
Ah… the photo of B.N Balaji has been replaced with Ho Ching’s.
She finally opened her mouth after Goodyear decided to quit. Is she afraid that the truth will be disclosed by Goodyear and they cannot hide the losses anymore? Beside, what will Tharman said about Ho Ching admission of the huge losses since he said Temasek were making net gain the other day? With such lousy result disclosed by her, why was she given golden award for her performances? I cannot understand her dogs.
kudos to mdm Ho. She deserves more than a poke in the eye this time round.
I’m very worried but I feel so helpless, as I see the money ( a lot,a lot of money) gone and I’m not able to do anything. They used our money to invest, when times are good, they paid themselves good bonuses, we don’t even get any share of the profit,but when they made a lost, we foot the bill, will they pay us back the money?
to have a sense of proportion (because mm lee always say we don’t have)
$40 billion = 50 years of GST offset for everyone
or
3 meals of $2 chicken rice for 12 years for everyone
imagine a singapore where people don’t have to worry of food and pursue their dreams. or where old, poor do not have to slog and beg.
alas pap would rather lose the money to ang moh than to help singaporeans.
and the people responsible are still drawing sky high pay & no one need to answer for it.
She didnt even say sorry.
Award was not for earning performance..award was for Temasek for being a good employer…and why not ??
After this mammoth of a fiasco no one in Temasek has yet to be fired.
I am not sure I understand.
Between March and November 2008 TH lost nearly $60 bn. Is HC saying that between December 2008 and March 2009, when financial markets were still frozen and asset values dropping like stones, TH _made_ $20 b??
“We are certainly not happy with the negative wealth added in March last year, as well as March this year” is classic TH double-speak. Why not say “asset erosion” instead of “negative wealth added”?
Holy cow…the pm’s wife can do whatever she wants without punishment and remorse. 2 thumbs up for her !!!!
look, she has luck on her side. who in private sector get such treatment for the major record breaking “feat”?
she lucky, S’pore lucky. lol…
& with the luck, we will strike jackpot in no time!! :)
Only in singapore, i guess, can people get away with such stuffs….and can brush it off some more
Personally, I think Temasek should be floated on the stock exchange and every Singaporean should be given the right to buy some shares in Temasek. I mean, yes, we the tax payers and CPF contributors already give Temasek money but think about it – Temasek claims that it is an independent commercial body-so what better way to treat is as such than by floating it on the stock market.
By law, a listed company needs to publish its results. By law, a listed company’s CEO needs to explain the company’s performance to the shareholders. By law, a listed company must make an attempt to create wealth for the shareholders. A listed company works on the principle of rewarding risk taking with returns on the part of shareholders. – So isn’t this enough reason to float Temasek? —Trust me, someone may take up the idea and someone else may make exceptions to the law.
@12- Anonymous…
NICE analogy! but very true indeed. think of the dozens of ppl you could help out with that $40Bn. and this senile woman just washed it down the drain…
but you know what pisses me off the most, its NOT when someone makes a mistake, but when the person decides to hide it , thinking nobody will find out. And when ppl do find out, damn… mdm Ho bloody better wish that she were dead.
(but HC is worst case scenario, lose $$ den come back again and lose more $$.. now lets wait and hear what BS she has to say)
Goodyear was like a chip, luckily for him, he did not seem chipped in the process.
To 18# Tang Li
You may be right, but she will tell you that she can’t agree with you because of strategic differences? and what’s next, she will just fire you with her father-in-law backings and her husband giving her all the approval she needs and our president….you can forget about his existence because his payroll is controlled by his master (you know who). We are doomed in this kind of one-family system. Extremely dangerous and unhealthy for the well-beings of this nation (or does it exist?)
Do note that Temasek Holding is just the tip of iceberg and use as distraction to divert even more devastating loss of old fart. Isn’t the GIC under Old fart lost even more than TH ? How can westerner never report the news of GIC ? Obviously it is needed to save the old fart’s face. Let’s not give old fart any face anymore because he don’t have one in the first place.
“Ho said the company’s senior management have most of their compensation incentives deferred between three years and 12 years.”
In the private sector, a $58B or $40B loss (whatever); the senior management will have their compensation deferred forever….fired…
She looks jinxed. No wonder her nick is ho jinx.
thus this means
goodyear was the bloke who loss $40 billion$
seem liked pointin fingers ley…
wah famiLLEE’s jeweller as well
win its the LEE money
loss its the people cpf$
[i]she needs and our president….[/i]
eer
sala
our president need her
without her
would he be gettin paid @ over $200,000++/month?
not says i say so
the high commisooner to I LEARN says one…
Ho Ching..sure read out a well written piece….when thru the whole article….my..my …how nice of her to inform us of the Familee culture…of ownership…among employees….
About time you run your (ship) companies economically then your …….
Qutoe….
we are almost always prepared to sacrifice some efficiency or effectiveness to maximise training and learning
opportunities for our staff, both individually and as a team. We are prepared to take the short-term inefficiency pains for long-term people
gains. Unquote..
A 40 billion dollar pain…is quite unbearable madam….nice analogies….but one too many…instead of numbers.
And This is scary….
Quote
12 Our credit ratings were followed by an international 10-year US$ bond in September 2005. The bond spreads are a real-time indicator of
our credit risks, much like the role of a singing canary in a coal mine. Unquote.
Nice but cannot conclude with a proper rating.
#coldsweat
Got give you what…ERS…then election come some pocket money….
but of course they take back lah….
Wonder which rating agencies did it, since all rating agencies are under fire recently.mmmm. S&P or Moody’s….
All kena kick in the butt after Mac Daddy fiasco….wow…many questions will remain unanswered.
The lost is now $40B..cos it is always changing….then it was $$58B..then when equity prices move up it becomes less….
Can someone help me tabulate, like shin corp how much…BoA how much…then whatever all how much losses….lets see if we can get a ball park figure.pls.
Why nobody point finger at Mr Dhanabalan? Like that he will continue to anyhow appoint CEOs, as long as it pleases someone who can benefit him. PM oredi tai-chi his responsibility, what about Mr Dhanabalan & the board then? Its not their money and they don’t report to anyone, so they just invest in ‘what they have interest in’ (quote from Ho Ching), not what makes money.
“Negative wealth added”.Huh?
Nice play with words……….
With such verbal manoervering even by the top honcho,you expect transparency from Temasek?It does not even dare to use”loss”.
there are no mechanisms in the island republic that can really challenge and bring about change to the deeply entrenched system of dictatorial rule. it like hitting against a brick wall. at least in the foreseeable future. of course, having said that, nothing remains unchanged forever. the deadliest enemies of any empire is time.
The 154th ranked Singapore govt newspaper (an unobjective paper) is mellowing the headline which did not highlight the billion dollars losses by Ho Jin.
aiyoyo
cpf $ got hope to take out soon?
hdb price got hope to be much lower?
aiyoyo
i see that there is no sense of remorse shown, no accountability displayed, no hint of regret through her speech and mannerism.
any decent CEO would have apologised to their shareholders and quit for good…..but here they still so proud of themselves….and still have the gall to ask for people to invest in their company…..really makes me sick to the stomach.
Oh I See!
Goodyear left becos he refused to deliver such confusing and misleading statements!
Something must be VERY wrong with the accounting methods used by TH!!!!
Seems like the appointments are accepted by the People based on Majority rule concept. Not only that, no conflict of interesting wan. swee swee wan.
well done singapore, singaporeans and 1st world education.
why need so many ft? dio boh , singaporeans so smart wat.
Questions:
Secrecy in national weatlh management is good or not ? No transparency and fund managers have less accountability to man-on-the-street. Can they learn something after a 40B lesson ? It is our money, have they no shame at all? Still want to receive the May Day Award. What is our president doing ?
Maddof loses $100b. TH loses $40b. One goes to jail, the other continues to call the shots.
The analogy may not be fair.One operated outside of the law, the other within its ambit.
But In both instances, it’s the people’s hard-earned money that has gone down the drain.
The question to ask in the case of TH: Surely, the rot cannot be allowed to continue.
Or have we come to the stage where we are no longer able to distinguish between what is competence and incompetence.
Hmmm… is this a scheme to create a distraction to the more immediate CPF Life issue?
31) B.Kuppupokusamy
“Negative wealth added”.
Indeed, her words are PR-contorted to avoid sounding what it exactly is: “negative wealth added” means simply “loss”! Too hard to use the negatve word huh…
She should admit her incompetence and step down.
BH:
Muahaha, yes, first time I’ve seen that euphemism used. Negative wealth added. I guess it may appear in the annual performance reviews of GLCs soon. How about we use term “negative value added” to describe the performance of the CEO?
My family don’t mind eat chicken rice for 12 years x 3 meals. We can be very rich by 12 years.
I guess I need to give up my passport and take back my CPF or they will lose more…
the downfall of PAP.
Used to be we trusted the socialist democratic party to do the right thing for its citizens,
now we know better- I would rather the Temasek Holdings be disbanded and the wealth returned to its citizens – or at least – pay back to our CPF more than the miserable percentage.
CPF / GIC / TH must be disbanded so that more Singaporeans can retire gracefully.
Now we know why Goodyear was brought in – to bear some of the blame and soften the negative impact on HC. Smart idea HC, but stupid in execution. We all know you are solely responsible for all the mess Temasek is in right now.
Another thing I do not understand HC. Why is one (HC) who had lost the legs and hands of a baby be allowed to stand in the way of a doctor (Goodyear) brought in to help the baby get on with life? She is even given the authority to decide whether the doctor is good enough for the baby.
The power of binding ties is all I can think of.
@#31…
yes. damn freaking true.
quote “negative wealth added”..
FREAKING BUNCH OF COVERUPS!
HC’s better off digging her own grave now.
and guys..!!!!!!!!!!
READ!! TODAYS NEWS. posted by Sydney Morning Herald abt temasek, HC and their ploys,
http://business.smh.com.au/business/lumbered-with-the-bosss-wife-20090729-e1oc.html?page=-1
We are holding assets including one of the largest bank on earth…..Its like Singapore is creating an empire by just, investments. But slowly our assets has shrink rapidly.
The most sinful people on earth are those who use words to cover their tracks. Take the example of the financial meltdown. It was caused by some greedy wall street american bankers packaging the cdo’s and subprime loans into minibonds and so on. This crooks got the perverted mind to call the crisis “financial tsunami” as if it is caused by God and a natural disaster. The world systems collapsed all because of their greed and deceit, yet it is covered up using such innocent terms like financial tsunami as if they are not to blame.
“Negative Wealth” is another idiotic dressing up term to absolve the perpertrators of the fiasco from responsbility. Can’t stand it. Why can’t they be humble and step down. I remember when the Japanese management of some big company make mistake they call a conference and line up and bow in shame to the people. Nothing short of that could appease the anger of the people of Singapore.
long live the Jinx!! :)
lol…
12) Gigi
//////// She didnt even say sorry. /////////
The answer was sang by Elton John at the Indoor Stadium last year
Now I realised he was singing to her for us
“Sorry seems to be the hardest word”
- Elton John
What have I got to do to make you love me (us citizens)
What have I got to do to make you care (us citizens)
What do I do when lightning strikes me (you know which lightning)
And I wake to find that youre not there (that refers to our CPF)
What do I do to make you want me
What have I got to do to be heard (us citizens)
What do I say when its all over
And sorry seems to be the hardest word
Its sad, so sad
Its a sad, sad situation (like blowing 40b)
And its getting more and more absurd (your reasons for blowing 40b)
Its sad, so sad
Why cant we talk it over
Oh it seems to me
That sorry seems to be the hardest word