Tan Kin Lian's Blog: Hong Kong: Minibond investors demand full refund

Thursday, October 23, 2008

Hong Kong: Minibond investors demand full refund

Hong Kong: Minibond investors demand full refund
Wednesday, October 08, 2008

Lehman Brothers minibond holders are demanding a full refund of their money following the government's proposal that banks buy back the failed US investment bank's minibonds from investors.

The Hong Kong government on Monday proposed that 19 distributor banks and brokerage firms buy back minibonds from clients at market value to shorten the painful process of individuals recovering their money and limit reputational damage to banks.

About 50 investors attended a Democratic Party meeting yesterday to discuss the proposal.

Some minibond holders said they would not be happy if they can only get back 60 to 70 percent of their investment and insisted on a 100 percent refund. They also blamed the government for lacking supervision of investment products.

The investors said they will continue to pursue legal action on the marketing practices of the banks promoting Lehman minibonds.

Undersecretary of Financial Services and the Treasury Bureau Julia Leung Fung-yee reiterated yesterday that banks "are not exempted from the investigation on marketing practices even if they are willing to buy back."

The government expects distributors to look at the proposal and assess its potential risks before deciding within a week on whether to accept.

Investors will separately meet Bank of China (Hong Kong) (2388) representatives and lawmakers at the Legislative Council today.

5 comments:

Anonymous said...: If there was mis-selling and misrepresentation full compensation is rightful. Investors should be restored to where they were financially before misrepresented and mis-sold.
FIs are fearful of this.. because it amounts to intention to cheat by the RMs or the distributor.

Nothing less than 100%; October 23, 2008 7:30 PM
Anonymous said...: Hi,
As a neutral SIngaporean, Im NOT in favour of any kind of compensation for Investors of Sturcutrd Notes, except for the very low educated. As I understand, when you buy strcutured notes, you're required to have a CDP account in the first place. THAT clearly shows you are also a stock market player. How can you turn around now-- when the financial world is collapsing and many people are losing money--- and say structure notes are toxic ??? Please be good losers!!; October 23, 2008 7:42 PM
Anonymous said...: Nobody has any Right to declare how much the compensation should be for the masses. It is entirely up to each person. If there is any one who doesn't mind something less than 100%, it is his perogative. But he cannot speak for others.; October 23, 2008 9:46 PM
Anonymous said...: I saw on the news a female lawyer cautioning against the use of a lawsuit as it is both long drawn and expensive. I cannot believe my eyes and ears when I saw that. I wonder why this lawyer did not mention the same thing to people like TT Durai and those ministers who use lawsuits against the opposition parties. The same rationale could also be used regarding it being long drawn and expensive.
When there is an injustice, isn't a rule of law country like Singapore supposed to use the lawsuits when other avenues fail?; October 24, 2008 12:11 AM
Anonymous said...: Yeah, it was a fat female lawyer who appeared on TV. Hope she will take her own advice not to sue me as it will be long drawn and expensive to prove that I have cause her distress if any.; October 24, 2008 4:29 PM