Francis Chan
ST Money correspondent
Up Close with Angry DBS High Notes Investors
October 31, 2008 Friday, 10:41 PM
Francis Chan describes the atmosphere during the four DBS forums this week.
MORE than 700 customers of DBS Bank were in dialogue with the bank this week at Suntec City Convention Centre.
Okay, dialogue is probably too polite a word for it, from what I heard on the other side of the door, it sounded more like a slugfest, albeit coming from one direction.
The 700 are part of 2,400 customers of DBS who had invested over $170 million into credit linked notes sold by DBS called High Notes 2 and High Notes 5.
Investors of series 5 of the notes, who had accused DBS of misleading them into buying the complicated structured products linked to bankrupt US investment bank Lehman Brothers, demanded the meetings last week and amazingly got their way.
When I covered the event over Thursday and Friday, it was clear that investors of both series of products went to the forums with a mission.
In fact, a 300-strong action body called DBS Hi Notes Investor Group even got a handful of his members to attend the dialogues wearing red.
"It’s a show of solidarity with DBS," said one of its members, with a wink.
The group was highly organised, I learnt on Thursday. They told me that they had different people performing specific roles for the group such as "marketing communications", "logistics" and of course, "media relations".
Don’t believe me?
I just received a "Press Release" from the group last night. In it, was a professionally written report, detailing the group’s take on the forums and what it plans to do going forward.
But now back to the forum.
The media were not allowed in, naturally, but the echoes we hear through partitions hinted of emotionally charged investors "giving DBS a piece of my mind", as one investor told me.
Even the usually cool Rajan Raju, who heads the bank’s consumer banking business admitted after the first forum on Thursday, that there was a lot of anxiety with investors clamouring for a chance to take a shot at DBS.
When asked by a reporter for his take of the first dialogue session on Thursday, he coolly replied, "One, is that our customers are extremely emotional at this time."
But on the business end, Mr Raju, stuck to his guns, saying it was important that DBS kept to its "principals and process".
"As you can understand is not an easy task but that is something we have to continue to talk and discuss with our customers," he said.
And talk he did, and possibly even winning over some customers with his sincerity and courage under fire.
"I can tell the Rajan guy is a good guy, I can tell he wants to help," said one investor, a retiree in his 60s who invested $25,000 in High Notes 2. He was attending yesterday’s session.
"But too bad, ultimately, its the top guys above him that will decide our fate," he said, as he waved me goodbye, brushing away my chance to pull out my voice recorder.
Much has been said about the debacle; not all were easy on the ears of either DBS or the investors.
Even reporters and news photographers have taken a hit by angry investors seething from the impotence of the forum, or their efforts to bully a refund from DBS.
Most were not in the mood to share their stories. Those that did are sometimes grateful for just another listening ear.
High Notes 5 was unwound after Lehman crashed on Sep 15 and unsuspecting investors were told then, that their investments may be wiped out.
This week, those same investors found out that their investment in High Notes 5 were worthless.
As for High Notes 2, it still has some value, but it is hovering dangerously around 16 per cent and investors fear they may end up like the folks who bought High Notes 5, with nothing.
So two days and four forums later - many the investors still did not receive the "blanket" compensation they desperately expected.
Many, who also demanded an expression of guilt from DBS for allegedly misleading them into buying what they believe was a dodgy product from the start, also went home empty.
Surprise? Ask me again next week.
ST Money correspondent
Up Close with Angry DBS High Notes Investors
October 31, 2008 Friday, 10:41 PM
Francis Chan describes the atmosphere during the four DBS forums this week.
MORE than 700 customers of DBS Bank were in dialogue with the bank this week at Suntec City Convention Centre.
Okay, dialogue is probably too polite a word for it, from what I heard on the other side of the door, it sounded more like a slugfest, albeit coming from one direction.
The 700 are part of 2,400 customers of DBS who had invested over $170 million into credit linked notes sold by DBS called High Notes 2 and High Notes 5.
Investors of series 5 of the notes, who had accused DBS of misleading them into buying the complicated structured products linked to bankrupt US investment bank Lehman Brothers, demanded the meetings last week and amazingly got their way.
When I covered the event over Thursday and Friday, it was clear that investors of both series of products went to the forums with a mission.
In fact, a 300-strong action body called DBS Hi Notes Investor Group even got a handful of his members to attend the dialogues wearing red.
"It’s a show of solidarity with DBS," said one of its members, with a wink.
The group was highly organised, I learnt on Thursday. They told me that they had different people performing specific roles for the group such as "marketing communications", "logistics" and of course, "media relations".
Don’t believe me?
I just received a "Press Release" from the group last night. In it, was a professionally written report, detailing the group’s take on the forums and what it plans to do going forward.
But now back to the forum.
The media were not allowed in, naturally, but the echoes we hear through partitions hinted of emotionally charged investors "giving DBS a piece of my mind", as one investor told me.
Even the usually cool Rajan Raju, who heads the bank’s consumer banking business admitted after the first forum on Thursday, that there was a lot of anxiety with investors clamouring for a chance to take a shot at DBS.
When asked by a reporter for his take of the first dialogue session on Thursday, he coolly replied, "One, is that our customers are extremely emotional at this time."
But on the business end, Mr Raju, stuck to his guns, saying it was important that DBS kept to its "principals and process".
"As you can understand is not an easy task but that is something we have to continue to talk and discuss with our customers," he said.
And talk he did, and possibly even winning over some customers with his sincerity and courage under fire.
"I can tell the Rajan guy is a good guy, I can tell he wants to help," said one investor, a retiree in his 60s who invested $25,000 in High Notes 2. He was attending yesterday’s session.
"But too bad, ultimately, its the top guys above him that will decide our fate," he said, as he waved me goodbye, brushing away my chance to pull out my voice recorder.
Much has been said about the debacle; not all were easy on the ears of either DBS or the investors.
Even reporters and news photographers have taken a hit by angry investors seething from the impotence of the forum, or their efforts to bully a refund from DBS.
Most were not in the mood to share their stories. Those that did are sometimes grateful for just another listening ear.
High Notes 5 was unwound after Lehman crashed on Sep 15 and unsuspecting investors were told then, that their investments may be wiped out.
This week, those same investors found out that their investment in High Notes 5 were worthless.
As for High Notes 2, it still has some value, but it is hovering dangerously around 16 per cent and investors fear they may end up like the folks who bought High Notes 5, with nothing.
So two days and four forums later - many the investors still did not receive the "blanket" compensation they desperately expected.
Many, who also demanded an expression of guilt from DBS for allegedly misleading them into buying what they believe was a dodgy product from the start, also went home empty.
Surprise? Ask me again next week.
