<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR>BEST PAID govt in the world, but one that cannot deliver and cannot safeguard the people's interest. Fxxx PAPee! Fxxx the Familee!
Sep 21, 2008
What a harrowing week it was for...
</TR><!-- headline one : start --><TR>DBS 'High Notes 5' Investors:They pumped in life savings and now feel cheated
</TR><!-- headline one : end --><!-- show image if available --></TBODY></TABLE>
<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->Madam Evon Chin literally choked when she heard last Tuesday that her $75,000 investment in a DBS Bank product was in jeopardy.
The payroll executive and her husband had invested the sum in High Notes 5, which was exposed to Lehman Brothers, the United States investment bank that went bust.
<TABLE width=200 align=left valign="top"><TBODY><TR><TD class=padr8><!-- Vodcast --><!-- Background Story --><STYLE type=text/css> #related .quote {background-color:#E7F7FF; padding:8px;margin:0px 0px 5px 0px;} #related .quote .headline {font-family: Verdana, Arial, Helvetica, sans-serif; font-size:10px;font-weight:bold; border-bottom:3px double #007BFF; color:#036; text-transform:uppercase; padding-bottom:5px;} #related .quote .text {font-size:11px;color:#036;padding:5px 0px;} </STYLE>What now?
DBS Bank said capital invested in High Notes 5 was never protected or guaranteed. This had been stated in marketing collaterals and prospectuses.
It added that it will investigate complaints of misrepresentation by sales staff.
</TD></TR></TBODY></TABLE>'I was eating my lunch when my husband called. I started choking on my food. My face was so red, my colleague had to thump my back,' said Madam Chin, 40.
Her husband had told her their investment - from savings over the last 10 years - might now be wiped out. Worried, she took two days of urgent leave, determined to seek an explanation from the bank.
Like many other investors, she failed to understand how Lehman's collapse could wipe out their entire investment.
She had thought their risk exposure was diversified since the product had a basket of eight reference entities. 'We felt swindled. We were told this was a low-risk investment,' she said.
DBS said last Wednesday that Lehman's collapse triggered a 'credit event' that had a significant impact on High Notes 5.
The product is structured on a first-to-default basis which means that if any of the eight reference entities goes bankrupt, a credit event will be triggered and clients might not get their entire principal amount.
Said Madam Chin: 'I've never lost so much, not even when I was investing in shares. This will be a serious blow to our nest egg. Will I really have enough to see my children through their education?'
They had intended the money to be used for the education of their two sons, aged six and one. 'Now I can forget about my wish to have a third kid. This is really the saddest thing.'
The couple expect to have to tighten their belts. 'I'm going to switch my children's milk powder to a cheaper one. There will be no more eating out.'
She might also have to give up seeing a traditional Chinese doctor for her eczema. She used to pay for the sessions with the monthly interest from the investment.
Other investors like retiree Tham Wai Wah, 60, also felt 'cheated'. She had trusted the relationship manager who had explained to her last year that the High Notes 5 product was 'very safe'.
She said that with only an O-level education, she could not fully understand the prospectus. 'I told them I'm a conservative investor and that this was my CPF money.'
She put in $125,000, part of her Central Provident Fund (CPF) savings she withdrew upon retirement after working for 30 years as a clerk. Her husband is also retired.
She said: 'This is our fall-back, our cushion for old age. How can I accept that now I might have zero returns? What if I have any major illness in the next 20 years?'
She is thankful that she still has $130,000 in savings. She is prepared to sell her five-room flat in Punggol and downgrade to a smaller one if money runs out. 'I thought we could go on holidays with this money,' she said.
Senior merchandiser Carene Tan, 44, is worried that she might not have enough money for her children's university education.
She had invested $25,000, which she intended to use to send her 15-year-old son abroad for further studies. Her other son is 12.
'I was so upset. It's not going to affect my livelihood now because I still have a job, but it's like having to work half a year for free.'
Madam Chin is now more cautious: 'I'll never touch any investment instrument anymore.'
Gracia Chiang
Sep 21, 2008
What a harrowing week it was for...
</TR><!-- headline one : start --><TR>DBS 'High Notes 5' Investors:They pumped in life savings and now feel cheated
</TR><!-- headline one : end --><!-- show image if available --></TBODY></TABLE>
<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->Madam Evon Chin literally choked when she heard last Tuesday that her $75,000 investment in a DBS Bank product was in jeopardy.
The payroll executive and her husband had invested the sum in High Notes 5, which was exposed to Lehman Brothers, the United States investment bank that went bust.
<TABLE width=200 align=left valign="top"><TBODY><TR><TD class=padr8><!-- Vodcast --><!-- Background Story --><STYLE type=text/css> #related .quote {background-color:#E7F7FF; padding:8px;margin:0px 0px 5px 0px;} #related .quote .headline {font-family: Verdana, Arial, Helvetica, sans-serif; font-size:10px;font-weight:bold; border-bottom:3px double #007BFF; color:#036; text-transform:uppercase; padding-bottom:5px;} #related .quote .text {font-size:11px;color:#036;padding:5px 0px;} </STYLE>What now?
DBS Bank said capital invested in High Notes 5 was never protected or guaranteed. This had been stated in marketing collaterals and prospectuses.
It added that it will investigate complaints of misrepresentation by sales staff.
</TD></TR></TBODY></TABLE>'I was eating my lunch when my husband called. I started choking on my food. My face was so red, my colleague had to thump my back,' said Madam Chin, 40.
Her husband had told her their investment - from savings over the last 10 years - might now be wiped out. Worried, she took two days of urgent leave, determined to seek an explanation from the bank.
Like many other investors, she failed to understand how Lehman's collapse could wipe out their entire investment.
She had thought their risk exposure was diversified since the product had a basket of eight reference entities. 'We felt swindled. We were told this was a low-risk investment,' she said.
DBS said last Wednesday that Lehman's collapse triggered a 'credit event' that had a significant impact on High Notes 5.
The product is structured on a first-to-default basis which means that if any of the eight reference entities goes bankrupt, a credit event will be triggered and clients might not get their entire principal amount.
Said Madam Chin: 'I've never lost so much, not even when I was investing in shares. This will be a serious blow to our nest egg. Will I really have enough to see my children through their education?'
They had intended the money to be used for the education of their two sons, aged six and one. 'Now I can forget about my wish to have a third kid. This is really the saddest thing.'
The couple expect to have to tighten their belts. 'I'm going to switch my children's milk powder to a cheaper one. There will be no more eating out.'
She might also have to give up seeing a traditional Chinese doctor for her eczema. She used to pay for the sessions with the monthly interest from the investment.
Other investors like retiree Tham Wai Wah, 60, also felt 'cheated'. She had trusted the relationship manager who had explained to her last year that the High Notes 5 product was 'very safe'.
She said that with only an O-level education, she could not fully understand the prospectus. 'I told them I'm a conservative investor and that this was my CPF money.'
She put in $125,000, part of her Central Provident Fund (CPF) savings she withdrew upon retirement after working for 30 years as a clerk. Her husband is also retired.
She said: 'This is our fall-back, our cushion for old age. How can I accept that now I might have zero returns? What if I have any major illness in the next 20 years?'
She is thankful that she still has $130,000 in savings. She is prepared to sell her five-room flat in Punggol and downgrade to a smaller one if money runs out. 'I thought we could go on holidays with this money,' she said.
Senior merchandiser Carene Tan, 44, is worried that she might not have enough money for her children's university education.
She had invested $25,000, which she intended to use to send her 15-year-old son abroad for further studies. Her other son is 12.
'I was so upset. It's not going to affect my livelihood now because I still have a job, but it's like having to work half a year for free.'
Madam Chin is now more cautious: 'I'll never touch any investment instrument anymore.'
Gracia Chiang
