- Joined
- Jul 24, 2008
- Messages
- 33,627
- Points
- 0
Were there not reports that the total amount of $ inside his pocket is about $500B++, so a 20% loss = $100B. As expected, NO REGRET! Well Done!
Singapore’s GIC Says Investments Drop 20%, UBS Stake Has Loss
Share | Email | Print | A A A
By Joyce Koh and Netty Ismail
Sept. 29 (Bloomberg) -- The Government of Singapore Investment Corp. said its investments fell by more than 20 percent in Singapore dollar terms in the year ended March 31, and it continues to have a loss on its UBS AG stake.
The manager of more than $100 billion of the city’s foreign reserves said it will “seize good investment opportunities” after it recovered more than half of that loss as global stock markets surged. It warned of a greater risk of rising inflation from government efforts to pump money into economies, Chief Investment Officer Ng Kok Song said in GIC’s annual report today.
Under Chairman Lee Kuan Yew, Singapore’s Minister Mentor and former prime minister, GIC has expanded through investments ranging from U.K. shopping malls to European and U.S. banks. Temasek Holdings Pte had a record drop in profit after selling its stakes in Bank of America Corp. and Barclays Plc at a loss.
“The GIC presumably will seek to maintain a diversified portfolio, and perhaps is a little more inclined toward liquidity than before the financial turmoil,” said David Cohen, an economist at Action Economics in Singapore, before the annual report was released. “Nevertheless, they retain a long-term perspective, and recognize that they must assume some risk in pursuit of their long-term return.”
GIC, established in 1981, said annual returns in the past 20 years averaged 5.7 percent in U.S. dollar terms, from 7.8 percent reported in the previous fiscal year. Its portfolio value had fallen about 25 percent between October 2007 and December 2008, Finance Minister Tharman Shanmugaratnam said in March, after GIC bought stakes in UBS and Citigroup Inc. during the credit crisis.
Citigroup, UBS
GIC last week pared its shareholdings in Citigroup to less than 5 percent from more than 9 percent, realizing a $1.6 billion profit on the investment. Its investment in UBS will “take longer to recover” and is still showing a loss, GIC said in the annual report. The company said both investments have recovered “significantly.”
The company said last month it didn’t take part in the placement of 6 billion Swiss franc ($5.9 billion) of UBS shares sold by the Swiss government.
“The investment thesis was to capitalize on the unique business franchises of UBS in global wealth management, and of Citigroup in global consumer and corporate banking, especially in the emerging economies,” said Ng, 61, in the annual report. “While both banks still face challenges in returning to profitability, we maintain our confidence in their long-term prospects.”
GIC bought stakes in the two banks “too early,” the Straits Times reported on March 5, citing Minister Mentor Lee, 86. Unlike Temasek, GIC doesn’t publish a financial statement and doesn’t give a figure for the value of its assets.
Investment Mix
The subprime meltdown wiped 44 percent off the MSCI World Index, erasing about $24 trillion from the value of global equities in the 12 months to the end of March. Financial companies worldwide have recorded $1.6 trillion in writedowns and losses stemming from the collapse of the U.S. subprime mortgage market.
The MSCI World Index has rallied 64 percent from this year’s low in March.
The U.S. is home to as much as 38 percent of GIC’s assets, Ng said in its annual report. Europe accounts for as much as 29 percent and Japan as much as 11 percent, GIC said. In the fiscal year ended March 31, 2008, its U.S. investments were 34 percent, while European investments were 35 percent.
GIC’s investments in stocks dropped to 38 percent, from 44 percent the previous fiscal year, according to the report. It increased its allocations to alternative investments, including private equity, real estate and hedge funds, to 30 percent from 23 percent in the year ended March 31, 2008. Its cash holding rose to 8 percent, from 7 percent. Bond investments fell to 24 percent of its portfolio, from 26 percent the previous year.
The company said it cut public equities by over 10 percent between July 2007 and September 2008, helping it avert a larger loss. It bought back the equities at the start of the year to restore its portfolio’s public equities to its pre-crisis levels.
To contact the reporter on this story: Joyce Koh in Singapore at [email protected]; Netty Ismail in Singapore [email protected]
Last Updated: September 28, 2009 18:48 EDT
Singapore’s GIC Says Investments Drop 20%, UBS Stake Has Loss
Share | Email | Print | A A A
By Joyce Koh and Netty Ismail
Sept. 29 (Bloomberg) -- The Government of Singapore Investment Corp. said its investments fell by more than 20 percent in Singapore dollar terms in the year ended March 31, and it continues to have a loss on its UBS AG stake.
The manager of more than $100 billion of the city’s foreign reserves said it will “seize good investment opportunities” after it recovered more than half of that loss as global stock markets surged. It warned of a greater risk of rising inflation from government efforts to pump money into economies, Chief Investment Officer Ng Kok Song said in GIC’s annual report today.
Under Chairman Lee Kuan Yew, Singapore’s Minister Mentor and former prime minister, GIC has expanded through investments ranging from U.K. shopping malls to European and U.S. banks. Temasek Holdings Pte had a record drop in profit after selling its stakes in Bank of America Corp. and Barclays Plc at a loss.
“The GIC presumably will seek to maintain a diversified portfolio, and perhaps is a little more inclined toward liquidity than before the financial turmoil,” said David Cohen, an economist at Action Economics in Singapore, before the annual report was released. “Nevertheless, they retain a long-term perspective, and recognize that they must assume some risk in pursuit of their long-term return.”
GIC, established in 1981, said annual returns in the past 20 years averaged 5.7 percent in U.S. dollar terms, from 7.8 percent reported in the previous fiscal year. Its portfolio value had fallen about 25 percent between October 2007 and December 2008, Finance Minister Tharman Shanmugaratnam said in March, after GIC bought stakes in UBS and Citigroup Inc. during the credit crisis.
Citigroup, UBS
GIC last week pared its shareholdings in Citigroup to less than 5 percent from more than 9 percent, realizing a $1.6 billion profit on the investment. Its investment in UBS will “take longer to recover” and is still showing a loss, GIC said in the annual report. The company said both investments have recovered “significantly.”
The company said last month it didn’t take part in the placement of 6 billion Swiss franc ($5.9 billion) of UBS shares sold by the Swiss government.
“The investment thesis was to capitalize on the unique business franchises of UBS in global wealth management, and of Citigroup in global consumer and corporate banking, especially in the emerging economies,” said Ng, 61, in the annual report. “While both banks still face challenges in returning to profitability, we maintain our confidence in their long-term prospects.”
GIC bought stakes in the two banks “too early,” the Straits Times reported on March 5, citing Minister Mentor Lee, 86. Unlike Temasek, GIC doesn’t publish a financial statement and doesn’t give a figure for the value of its assets.
Investment Mix
The subprime meltdown wiped 44 percent off the MSCI World Index, erasing about $24 trillion from the value of global equities in the 12 months to the end of March. Financial companies worldwide have recorded $1.6 trillion in writedowns and losses stemming from the collapse of the U.S. subprime mortgage market.
The MSCI World Index has rallied 64 percent from this year’s low in March.
The U.S. is home to as much as 38 percent of GIC’s assets, Ng said in its annual report. Europe accounts for as much as 29 percent and Japan as much as 11 percent, GIC said. In the fiscal year ended March 31, 2008, its U.S. investments were 34 percent, while European investments were 35 percent.
GIC’s investments in stocks dropped to 38 percent, from 44 percent the previous fiscal year, according to the report. It increased its allocations to alternative investments, including private equity, real estate and hedge funds, to 30 percent from 23 percent in the year ended March 31, 2008. Its cash holding rose to 8 percent, from 7 percent. Bond investments fell to 24 percent of its portfolio, from 26 percent the previous year.
The company said it cut public equities by over 10 percent between July 2007 and September 2008, helping it avert a larger loss. It bought back the equities at the start of the year to restore its portfolio’s public equities to its pre-crisis levels.
To contact the reporter on this story: Joyce Koh in Singapore at [email protected]; Netty Ismail in Singapore [email protected]
Last Updated: September 28, 2009 18:48 EDT
