Two town councils invested in Lehman and Morgan Stanley.


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Nisa

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Aug 13, 2004
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#1
$12m in troubled products

Two town councils invested in Lehman and Morgan Stanley.

Mon, Nov 17, 2008
The Straits Times

TWO town councils - Holland-Bukit Panjang and Pasir Ris-Punggol - have about $12 million invested in troubled structured products.

These products include Lehman Minibonds, DBS High Notes 5, Merrill Lynch Jubilee Series 3 and Morgan Stanley Pinnacle Notes Series 9 and 10.

Senior Minister of State (National Development and Education) Grace Fu gave this update in Parliament on Monday, in response to a question from Nominated MP Eunice Olsen.


source : http://business.asiaone.com/Business/News/My+Money/Story/A1Story20081117-101256.html
 

Jan 28, 2008
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#2
What is the world coming to? Town council oso can invest? And $12mil??? That means we have been like paying alot in excess all along? They should just lower the fees they collect each mth lor. like tht gd for every single one.... We will save $$, they will not have $$ to take go and invest in all these, but will still have enough $$ to operate the neighbourhood. Then no worries of them losing $$ and facing the negative publicity!
 

#3
$12m in troubled products

Two town councils invested in Lehman and Morgan Stanley.

Mon, Nov 17, 2008
The Straits Times

TWO town councils - Holland-Bukit Panjang and Pasir Ris-Punggol - have about $12 million invested in troubled structured products.

These products include Lehman Minibonds, DBS High Notes 5, Merrill Lynch Jubilee Series 3 and Morgan Stanley Pinnacle Notes Series 9 and 10.

Senior Minister of State (National Development and Education) Grace Fu gave this update in Parliament on Monday, in response to a question from Nominated MP Eunice Olsen.


source : http://business.asiaone.com/Business/News/My+Money/Story/A1Story20081117-101256.html
...... Ouch! :sweat:
 

aeskywan

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Feb 13, 2007
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Yes..... it is old news.... It was in the news. Our TC have an excess of a few billion dollars. not million dollars. And it is invested. Well wont comment on the politics of it. But I can say looking at the funds they invested in.... the monies are gone.

What evo said is true though.... why not lower fees, help those who need help. Instead of now... fees don't go down, families die die have to pay the fees no matter how they cannot pay. They are made to work out a "repayment" plan. And our TC are grossly profiting from the fees.......

Oh well Uniquely Singapore!
 

Jan 28, 2008
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#5
Yes..... it is old news.... It was in the news. Our TC have an excess of a few billion dollars. not million dollars. And it is invested. Well wont comment on the politics of it. But I can say looking at the funds they invested in.... the monies are gone.

What evo said is true though.... why not lower fees, help those who need help. Instead of now... fees don't go down, families die die have to pay the fees no matter how they cannot pay. They are made to work out a "repayment" plan. And our TC are grossly profiting from the fees.......

Oh well Uniquely Singapore!
Yea, Totally lah! Its like if the headlines today is "TC Donates $12Million to needy families", i will not be cursing n swearing at them here alrd, i will even praise them!

Wahseh, really pains me to see $12mil go down the drain like this.... $12mil leh, can help how many needy families?? one family $1000, can help 12 000 families leh.... I dunno but 12000 families is alot leh, it may be enuf to really help all the needy families in SG lor... Somemore, this is only 2 TC, imagine if all the TC got how much of these risky investments!

Sigh.... As more and more financial products fails, more will be revealed.....
 

night86mare

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What is the world coming to? Town council oso can invest? And $12mil??? That means we have been like paying alot in excess all along? They should just lower the fees they collect each mth lor. like tht gd for every single one.... We will save $$, they will not have $$ to take go and invest in all these, but will still have enough $$ to operate the neighbourhood. Then no worries of them losing $$ and facing the negative publicity!
blah blah blah

blah blah blah

uniquely singapore, uniquely britain.. we are all unique yet the same

link

p.s. i bet no one will even look at the link
 

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drewdam

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Jun 18, 2005
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:what: so much funds?? sigh ..... this is really run like an INC..
 

#9
blah blah blah

blah blah blah

uniquely singapore, uniquely britain.. we are all unique yet the same

link

p.s. i bet no one will even look at the link
The Iceland thingy is not new "news" wat.. About the same time as the AIG and Lehman. British Police Retirement fund for example went up in smoke as they and a other UK companies has been investment interest in financial institutions in Iceland. Their meltdown was worst then US.
 

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night86mare

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#10
The Iceland thingy is not new "news" wat.. About the same time as the AIG and Lehman. British Police Retirement fund for example went up in smoke as they and a other UK companies has been investment interest in financial institutions in Iceland. Their meltdown was worst then US.
i never said it was new, just that it seems like a lot of the people in this thread have no idea about it happening. :lovegrin:

it being the trend of like.. government bodies that have nothing to do with finance investing their monies overseas, etc.
 

#11
i never said it was new, just that it seems like a lot of the people in this thread have no idea about it happening. :lovegrin:

it being the trend of like.. government bodies that have nothing to do with finance investing their monies overseas, etc.
Actually I was talking to my bro-in-law (he is a financial planner with the UK base GE and some of his customer investment are allocated in a number of place in UK and we got to talking about Iceland) about it and I was wondering actually if any in Singapore garment side did the same thing. And the news I see today just confirm something we talked about last month. Scary...
 

night86mare

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#12
Actually I was talking to my bro-in-law (he is a financial planner with the UK base GE and some of his customer investment are allocated in a number of place in UK and we got to talking about Iceland) about it and I was wondering actually if any in Singapore garment side did the same thing. And the news I see today just confirm something we talked about last month. Scary...
speculation does nothing for anyone

right now, asian markets are suffering from confidence issues, rather than fundamental problems, like the europe/us fiascos. :)
 

denniskee

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Oct 26, 2003
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#14
12m,:think: thought i heard something about them authorized to "invest" certain percentage of their fund. and last i heard sometimes back the news had it that they were not affected by it cause it is only a very small sum that were invested in the lehman thingy?:think::dunno::confused::what:
 

jasonlcs

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Apr 11, 2008
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#16
2 town councils have announced their individual loss in investments.

:bigeyes: S$12,000,000.00

How about the rest ? :dunno:

Aljunied Town Council
Ang Mo Kio - Yio Chu Kang Town Council
Bishan-Toa Payoh Town Council
East Coast Town Council
Holland-Bukit Panjang Town Council
Hong Kah Town Council
Jalan Besar Town Council
Jurong Town Council
Marine Parade Town Council
Pasir Ris-Punggol Town Council
Sembawang Town Council
Tampines Town Council
Tanjong Pagar Town Council
West Coast Town Council

I hope that the TC fund managers still can keep their jobs and pants.
 

Jan 28, 2008
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#17
They shld juz donate it to us to buy camera, at the very least it is gd investment..... At least they get to enjoy gd photos when they come here, although not all gd ones la.... Woah imagine $12,000,000.00 can buy how many 5DMKII/1DsMKIII, A900, D900/D3.... eh if i got the nikon or sony models wrong, pardon me arh.... not a sony/nikon user..... Then maybe can buy a couple of full set L lens to share.....
 

Nisa

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Aug 13, 2004
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#18
That $16m question

Town Council chief saysprudence has kept riskexposure to acceptable level

Tuesday • November 18, 2008

Ansley Ng

ansley@mediacorp.com.sg

THE size of the burnt investments had earlier been described loosely as “a couple of percentage”, and yesterday, the hard figures — amounting to$16 million in all — were revealed for the first time.

Roughly $12 million, or 0.6 per cent, of Town Councils’ total funds available for investment had been sunk into Lehman Minibond notes, DBS High Notes 5 and Merrill Lynch’s Jubilee Series 3, shared Senior Minister of State for National Development Grace Fu in Parliament.

These were investments by the Holland-Bukit Panjang and Pasir Ris-Punggol Town Councils, which had put in 6.7 per cent ($8 million) and 2.6 per cent ($4 million) of their total investible funds — that is, their accumulated surpluses and sinking funds.

Six more Town Councils shared a $4-million exposure to Lehman Brothers-linked products, through their fund managers’ investment portfolios, revealed Dr Teo Ho Pin, co-ordinating chairman of the 14 People’s Action Party (***) town councils, in a press statement.

The six are Aljunied, Ang Mo Kio-Yio Chu Kang, Hong Kah, Marine Parade, Tampines and Tanjong Pagar.

Since the revelation two weeks ago that several Town Councils had sunk money into Lehman-linked products, some Netizens and letter-writers to the media have called for the full picture to be given, and asked if Town Councils should even be dabbling in such investments with money collected from residents’ service and conservancy (S&C) charges.

In Parliament yesterday, Nominated Member of Parliament Eunice Olsen asked if there really was a need to continue with such “complex and risky financial instruments”.

“Were the people at the Town Councils (responsible for these investments) aware of the risks involved, which included losing the entire sum?”

Ms Olsen, the only parliamentarian to ask about this issue, also wanted to know if the Ministry would further cap — beyond the 35-per-cent limit imposed just last year — the proportion of Town Council investments allowed in non-government securities and bonds.

No, said Ms Fu, as Town Councils were best placed to determine their own risk tolerance and needs.

“Some Town Councils prefer to charge higher S&C charges so they put their savings in very safe investments. With the inflation of six to seven per cent we have witnessed this past year, that leaves a significant inflation gap that the town councils will have to meet in the long run,” she said.

Other town councils collect “very low S & C charges” but when the time comes for major repair works, “they may have to collect from residents a significant amount”.

And then there are those that take the in-between route: “Collect average S & C charges, invest their sinking funds in the middle-range so that they can try to mitigate the inflationary gap ... They are able to meet the needs in the long run and, at the same time, they are not imposing significant pressure on their residents.”

As for whether they were aware of the investment risks they had taken, Ms Fu said: “We should ask the town councils and it is something the residents should pose to their respective town councils.”



SUBHD:

When TODAY put the same question to Dr Teo later, he declined to comment, saying that “events were still unfolding” with the Monetary Authority of Singapore reviewing the matter.

What was the town council doing to recover the value of its investments? Going ahead, would there be changes in the way it invests its money? Dr Teo’s response was that it was “always prudent” by not putting all its eggs in one basket, and it would follow the ministry’s guidelines.

In his press statement, Mr Teo noted that the 14 *** town councils had achieved an average annual rate of return on investments of over three per cent – more than three times the average interest of about 0.9 per cent earned on fixed deposits over the same period.

He stressed that they exercised “prudence” with a diversified investment portfolio, hence “keeping overall risk exposure down to an acceptable level”.

On concerns about the dent in sinking funds – used for long-term improvement works such as lift-replacement – Mr Teo assured his own residents that the town council’s funds remauined “healthy”.

“There will neither be a deterioration of Town Council services nor a delay in the works and plans the Town Council had in place before the financial turmoil,” he declared.

In the past six years, the town council’s kitty has grown from $62.6 million in 2002 to $118.8 million as at March this year – and 43 per cent of the increment was attributable to investment income, he pointed out.

Dr Ahmad Magad, chairman of the Pasir Ris-Punggol town council, said its average annual investment income and return over the last five years were $4.36 million and 3.4 per cent respectively.

Despite the current depreciation in value of its intesvment, he said: “Our long term outlook remains positive.”

source : http://www.todayonline.com/articles/287786.asp
 

azul123

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Dec 4, 2004
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#19
Will this impact any upgrading programs? should be my questions to the Town Councils.

Also, I hate to see spin words like "couple of percentage", "significant amount", "always prudent", “keeping overall risk exposure down to an acceptable level”, town council’s funds remained “healthy”.

1) How much is couple of percentage? revealed 6.7% & 2.6% for Holland-Bukit Panjang and Pasir Ris-Punggol Town Councils respectively.
2) Singnificant amount? how much tell lah... what? transparency is missing from their vocabulary?
3) Always prudent? then how come got into this mess, how was prudence exercised?
4) What is acceptable investment level?
5) What amount constitute "healthy"?

Want to reveal then reveal... don't give half answers and think that is transparency.

../azul123
 

waileong

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#20
What is the world coming to? Town council oso can invest? And $12mil??? That means we have been like paying alot in excess all along? They should just lower the fees they collect each mth lor. like tht gd for every single one.... We will save $$, they will not have $$ to take go and invest in all these, but will still have enough $$ to operate the neighbourhood. Then no worries of them losing $$ and facing the negative publicity!
Who said town council cannot invest?

Who gave you the idea that town councils are so poor they have no extra cash? And if they have extra cash, they have to park somewhere, right? It's just in this case they chose a Minibond over a FD.

I wonder what will happen to the finance managers of these town councils though.
 

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