My View on Temasek Holdings

Just last month, Singapore investment arm, Temasek Holdings, reported a gain of S$56 billion from March 2003 to March 2008. According to the Finance Minister Tharman Shanmugaratnam, the full year accounts from Apr 2008 to March 2009 have not been audited and that the picture should not be fundamentally different. His remarks do not sound convincing to me. Everyone knows the stock market was in a decline from Apr 2008 to March 2009. To make matter worse, Temasek made 2 huge losses by selling Bank of America (BofA) and Barclays despite saying these investments were for the long term.

It is noted that Temasek sold its stake in British banking giant Barclays in December 08 and January 09, at an estimated loss of S$1.2 billion. This is in sharp contrast to Abu Dhabi investment arm gain of US$2.5 billion in just over seven months.

Temasek Holdings made another bigger loss by selling Bank of America (BofA) shares in the first quarter of 2009. Reuters estimated the loss to be more than US$3 billion. If only Temasek decided to sell its Merrill Lynch to BofA in Sep 2008, Temasek would have made a US$1.5 billion gain.

Other than the losses in Barclays and BofA, Temasek had also made significant losses on Australia's largest childcare group ABC Learnings and Thailand's Shin Corp. ABC Learning was made bankrupt and 29 of its childcare centres were sold at $1 each.

Under the care of Ho Ching, Temasek had made huge losses. I thought it is a shame and I definitely cannot believe what I am seeing. Given such unforgiving performance, Ho Ching even managed to be bestowed a top award on May day 2009. I hope the step down (voluntary or involuntary) as CEO of Temasek Holdings for American Charles W. Goodyear really brings us Good Year ahead.

I hope the Singapore government can be more transparent on gains and losses. Losses were often made public due to regulatory requirements from foreign factors. If Singapore were to hold a general election today, I bet the incumbent PAP may lose some seats.