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9/20/2011

GIC’s total portfolio value back to pre crisis levels

Responding to a letter calling for more disclosure for the UBS investment, Jennifer Lewis, Head, Corporate Affairs and Communications, GIC, wrote a reply in the Today paper and also reported in the ST. She said that GIC’s time frame for investment is 20 years. Anyway, all the fears of losing money are unfounded as the total portfolio value of GIC is back to pre crisis levels. No need 20 years to make back the losses.

What this means is that all the losses incurred in UBS and the purchase of American and European banks, and all and sundry investments, have been recovered. At that time it was reported that the total losses were in the region of tens of billions.

Given the assurance from Jennifer Lewis, Singaporeans can now sleep in peace that the super talents in the organization have done their job well and made back all the losses. How much were the losses, and how much were recovered, how were they recovered were not explained. But this is acceptable as such information is probably covered under the Official Secrets Acts or a trade secret that may undermined our security and survival, like not having enough babies.

What perhaps the public may be comforted is for GIC to list out a few of the big gains from its investments that saw the recovering of tens of billions of dollars lost during the financial crisis. It would be very convincing if GIC could just name 5 investments with each making at least $10b profits to assuage the public’s fear of money down the drain. It would be a great public relations exercise to communicate with the people, to explain and inform the people that their money in GIC is safe. Oops, it is not their money as the GIC did not borrow money from the people but from the govt.

Anyway, please tell the people how some of the big losses were recovered and the people will have no reasons to be suspicious of what is happening. Quell the rumour mongers and raise the credibility of the organization, I think, is a good thing to do. It will absolve Tony Tan from all the perceived negative impressions of his watch while in GIC, that there is no more losses, and free Tony to do his unifying job as the Elected President.

3 comments:

Anonymous said...

Last year, I invested $100 million and lost every cent. This year, Ah Kong gave me $200 million. My portfolio of investment has doubled. What do you think? Am I a damn good investor?

Anonymous said...

Yes, we all know this.

Anonymous said...

According the Straits Times report of 20 Sept.2011, GIC is currently sitting on a paper loss (in their 6.41 per cent holding of UBS shares) of 6.45 billion Swiss francs. This is equivalent to $9.2 billion Singapore currency. GIC invested 245 million shares in UBS at 50 Swiss Francs per share in March 2008 before the financial crisis. UBS share price as at 20.9.2011 was about 10.13 SF. Will the share price slide further after what that rogue trader Bidoboli did?