Temasek CEO: Open to investing in western banks

August 25, 2009
Singapore Democrats

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P.R. Venkat & Costas Paris
The Wall Street Journal

Singapore state-owned investment company Temasek Holdings Pte Ltd. remains open to investing in Western banks and may divest from some Singapore companies, senior executives said Tuesday.

“If opportunities come, if it looks attractive, yes,” Temasek Chief Executive Ho Ching told reporters in a briefing when asked whether the investment company is still interested in banks in the West.

Earlier the year, Temasek came under pressure at home over big losses from its investments in Western banks, including Merrill Lynch & Co. — later taken over by Bank of America Corp. — and Barclays PLC. People familiar with the situation have said that Temasek lost more than US$5.4 billion after divesting from the two banks sometime between the end of last year and beginning of 2009 — before the global markets began a sustained rally.

Ms. Ho said in late July that Temasek’s total portfolio value as of end-March fell by more than 40 billion Singapore dollars (US$27.7 billion) from a year earlier.

Chairman S Dhanabalan said during the briefing that Temasek is open to divesting from Singapore companies if it feels that they can’t provide acceptable levels of growth, though he added that there is no immediate need for this. Temasek has major stakes in blue chip companies listed on the Singapore Exchange like Singapore Telecommunications Ltd., Singapore Airlines Ltd. and DBS Group Holdings Ltd.

Ms. Ho said Temasek still plans an initial public offering of port operator PSA International, Singapore Power and real estate company Mapletree Investments. She also added that Temasek is keen to list some of the funds in which it has invested in Asia to invite retail participation.

“Certain categories of business can be used to list on trust mechanism rather than separate companies,” she said.

Mr. Dhanabalan said Temasek will be involved in the ongoing merger talks between India’s Bharti Airtel Ltd. and South Africa’s MTN Group Ltd. as a SingTel shareholder.

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