Dr Tony Tan: GIC in “good shapeâ€
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Temasek Review - January 30, 2010
Written by Our Correspondent
Dr Tony Tan, the Deputy Chairman of Singapore’s giant sovereign wealth fund Government of Sinagpore Investment Corporation (GIC) has reassured Singaporeans that it is in “good shape” following some concerns and disquiet on the ground over the losses it incurred in its overseas investments lately.
Speaking to the Straits Times at the World Economic Forum in Switzerland, Dr Tan said GIC’s move to cut its equity holdings before the 2008 crash and being buying stocks early last year is “paying off”.
“We did an assessment in 2007 when markets were over-exuberant. We de-risked the portfolio, selling part of our equities. ‘We held it in cash throughout 2008 and in the early part of 2009, restored our equity values. At the present time,’we are in good shape and we are fairly liquid,” he said without elaborating more on it.
A Wall Street Journal article published in September last year reported that GIC may have suffered a loss around 59 billion Singapore dollars (US$41.6 billion) in the fiscal year ended March. (read article here)
A proportion of the losses come from its investments in UBS and Citigroup, made at the height of the crisis.
Dr Tan said GIC had confidence in the long-term prospects of the two banks and would continue to hold them.
“We monitor them,” he said, when asked about the huge losses reported by Citigroup in its latest quarterly statement.
UBS plunged into more trouble with the U.S. government when the Swiss government backed off an agreement with the United States that required it to hand over the names of wealthy American clients of the Swiss bank UBS who were suspected of tax evasion this Wedesday.
There is a likelihood that UBS will be indicted again by the U.S. Justice Department if no new agreements are reached.
GIC was also hit by potential losses of more than SGD$1 billion dollars in another failed overseas investment, this time in an upscale apartment complex in New York – Stuyvesant Town. (read article here)
The loss was initially not reported in the mainstream media till the Temasek Review published an article on it.
Founded in 1981 to manage Singapore’s budget surpluses accumulated over the years, it has been headed ever since by Singapore’s strongman Lee Kuan Yew, who is by a lawyer by training.
His daughter-in-law Ho Ching heads Singapore’s other sovereign wealth fund Temasek Holdings.
Both funds have come under intense public scrutiny and criticism in the last two years over their investment losses which amount to billions of dollars.
Though Singapore is the second richest nation in Asia after Japan and its sovereign wealth funds can afford to lose billions of dollars overseas, Singapore citizens enjoy few social welfare benefits from their government.
There is no opposition in Parliament to check on the all-powerful ruling party which continues to dominate and control every aspect of life in Singapore.
Respected international NGO Human Rights Watch described Singapore as a “textbook example of a politically repressive state” while U.S.-based Freedom House reported that “Singaporeans are unable to change their government” under the present electoral system.
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If you people notice, we are starting to read lots of more and more positive news from the beloved ruling party - signs of election - propaganda ???!!!!
Suddenly so much good news ever since they announced about the election.
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Comments from reader(s):
Sinkapore on Sat, 30th Jan 2010 3:05 pm
Lee Con You on Sat, 30th Jan 2010 3:14 pm
Hahaha, so long as GIC continues to be my personal bank account and provide me and my famiLEE with billions to spare, then it is certainly in good shape! Who cares about sinkies in the streets? hahaha
tide on Sat, 30th Jan 2010 3:18 pm
in “good shape”??? define ” good shape”?
A person in good shape can die of heart attack or cancer…James Tan on Sat, 30th Jan 2010 3:25 pm
We don’t know the truth as to whether it is in good shape because Singaporeans have been kept in the dark for far too long by this repressive regime. Didn’t we have confidence in the long-term prospects of the Bank of America too??? High time the pap paid for all these losses, Tony!!
forgetitlah on Sat, 30th Jan 2010 3:28 pm
Dear Dr Tony Tan,
Please show us what is meant to be passionate, honest and dedicated.
Explain and account for the losses.
We are talking about $50Billion, not $50.
AM on Sat, 30th Jan 2010 3:30 pm
GIC of course is in ‘good shape’ like Lehman Bros, AIG and Citi
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it is not a problem if they lose or win a 100billions, they lose also increase prices of goods, they win, prices of goods also increase, so what is the differences?? Better prepare for work...bye bye
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What you would expect him to admit that it was not or is not in a good shape? Since when there's freedom of press his statements were made through govt controlled media and a totalitarian regimes are known to resort to lying especially when there are crises and or scandals to hide from the public.
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And guess who reported GIC losses? NOT Singapore's Straits Times....
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The ironic is, who knows they earn or lost??
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The whole world know that Singapore GIC buy up UBS, Citi, Merrill Lynch, BOA!. Why did they invest in these companies when there are ample warning in the markets abt the meltdown. Eeven our very own DBS gives warning not to trade with Lehmen early in March 2008. Are they not aware that since Bear Stearns failed in early 2008, Lehmen, Merrill, AIG are scrumbling to raise equity to shore up their failing assets?
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Originally posted by angel7030:
The ironic is, who knows they earn or lost??
the issue is its none of our business.
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when they start assuring people they're doing fine when it's recession/depression times like now...............it means things are really really bad.................
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Originally posted by Wmyongj:
The whole world know that Singapore GIC buy up UBS, Citi, Merrill Lynch, BOA!. Why did they invest in these companies when there are ample warning in the markets abt the meltdown. Eeven our very own DBS gives warning not to trade with Lehmen early in March 2008. Are they not aware that since Bear Stearns failed in early 2008, Lehmen, Merrill, AIG are scrumbling to raise equity to shore up their failing assets?
Most probably because their divination tells them to . . . . .or their Prediction Extraordinaire lee kuan yuck tells them to . . . . . -
UBS in trouble.
Saw it in cna.
Will gic suffer another huge lost again?
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As long as AIG dont pay up its debts, the financial mkt will continue to be in trouble. GIC portfolio in these Amercian banks probably is not worth more than 20% of the price they paid by now. That how the 60B loss was calculated. By the way, 60b could build probably 600K units of HDB flats.
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in economic words, 1% of GDP is equivalent to 1 billion, so when the govt said GDP growth by 4%, it mean we make 4 billions. When you have growth of double digits like 10% or 12%, mean 12 billions gained into singapore share among us.
Since 2001 till now, the average GDP was at 6%, meaning 6billions per year gained, and for the whole decade till now, it is about 60 billions gained, and now we just lost that to Americans. So, in another words, we work hard, busy and stressed for nothing.
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angel, they will defend, it is only book value lost and they mkt will recover. It will be stupid to believe the Americans will ever pay us through future mkt rises. Why did we pay milllions to these people to manage our money like a novice? did we not learnt from the mistakes of losing BILLIONS our hard earn money to the American in the Asian meltdown in 1997 ? Did we not again learnt from losing more billions to the Americans on the internet bubbles???? Every 10 years we gives our reserve to the Americans! So ......WE STUPID SINGAPOREAN!!!!!!!!!!!!!
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Exactly, and those experts in GIC and Temasek are American economy and market gurus being pay millions just to give advices to those stupid chairmen and chairwomen of these 2 conglomerates. Imagine, americans advising Singaporeans to give money to america, is there any logic. No wonder Dr M is laughing.
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Originally posted by angel7030:
Exactly, and those experts in GIC and Temasek are American economy and market gurus being pay millions just to give advices to those stupid chairmen and chairwomen of these 2 conglomerates. Imagine, americans advising Singaporeans to give money to america, is there any logic. No wonder Dr M is laughing.
hi, longinchjohn.
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huh! me not my brother lah...aiyo, u miss longinchjohn ar??? he is coming later today,...he likes to take a short nap here, late i ask him to pm you lah.
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Originally posted by angel7030:
huh! me not my brother lah...aiyo, u miss longinchjohn ar??? he is coming later today,...he likes to take a short nap here, late i ask him to pm you lah.
don't kay kay, longinchjohn. -
haiz! give up
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the global financial crisi continue to spread so I am not sure if we are totally out of the wood yet as this year would be a correction years. As most Government had print monies now it is a concern......
NEW YORK, Feb 3 (Reuters) - The dollar rose broadly on Wednesday, boosted by generally stable U.S. economic data while mounting worries about Portugal being the next euro zone country to come under pressure after Greece lifted the greenback against the euro.
Concerns about Portugal pushed the single euro zone currency toward a key $1.3900 figure, while the cost of insuring Portuguese government bonds against default rose to a record 196 basis points, according to CMA DataVision. For details, see [ID:nLDE6122GD]
It would be interesting to know the current size of credit default swap? During the crisi it was 37 trillion globally.
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How much they lost, really doesnt concern me.
I only concern on whether govt can reduce all the fees across the board.
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How about we see it from a seperate pov?
We do know and the indicators do show that the meltdown was coming, but good will and political movements might be the cause for the investments.
I had chat with a few of those guys. Sounds smart, but I am no guru in investment. I believe those working in GIC are not stupid either.
However, adopting a wait and see attitude over this case is potentially going to cause a problem. How many billions can we afford to lose, before the alarm sounds off?
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you'll be surprised to know that i know a couple guys in MAS and they know virtually nuts about central banking..........
don't think smart people work for Temasek and GIC..................only obedient lackeys do...............
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Originally posted by As romanista2001:
you'll be surprised to know that i know a couple guys in MAS and they know virtually nuts about central banking..........
don't think smart people work for Temasek and GIC..................only obedient lackeys do...............
Same thing with the police force...or other civil servant positions......just obedient slaves . . . .smart people wouldn't allow themselves to be made as such. These either have no soul or no ability to become somebody better.
Whether it is in ‘good shape’ or not is irrelevant. Sinkaporeans wants accountability!
Even if GIC makes another 100b in 2011, Sinkaporeans would also want to know why it lost 50b in 2010. Making another 100b in the future DOES NOT negate the fact that GIC did lose 50b this year, an amount which if checked might NOT have been lost.
Accountability and Transparency is VITAL and NON-NEGOTIABLE!