Tan Kin Lian's Blog: Dow Jones: Hong Kong banks will buy back mini-bonds

Friday, October 17, 2008

Dow Jones: Hong Kong banks will buy back mini-bonds

HONG KONG (Dow Jones)--All the banks in Hong Kong will buy back the
mini-bonds backed by Lehman Brothers Holdings Inc. (LEH) that they sold to
retail investors, the Chinese-language Hong Kong Economic Journal reported
Friday, citing unnamed sources.

The paper said the banks and the Hong Kong Monetary Authority plan to
announce the details of the package Friday.

Monday, the Hong Kong Monetary Authority said Hong Kong''s banks sold
HK$20.17 billion (US$2.59 billion) worth of Lehman-related products to
retail investors, including HK$11.2 billion of mini-bonds, whose value
plunged after Lehman collapsed last month.

Separately, an 84-year-old woman and her mentally-ill son reached an
agreement with on a partial refund from DBS Group Holdings Ltd. (D05.SG) on
derivatives backed by Lehman, the South China Morning Post reported Friday,
citing the woman''s younger son.

The paper said it is the first case of settlement, but didn''t disclose the
details of the compensation.

-By Aries Poon, Dow Jones Newswires; 852-2832-2332; aries.poon@dowjones.com

20 comments:

Anonymous said...: looking at the achivement in Hk side and compare to here... feel like we are second class citizens...; October 17, 2008 11:07 AM
Anonymous said...: Actually i dont understand why they want the bank to buy back at the current value, i feel is like killing yourself as well. Why cant they look for another arranger or just sue the bank when they have evidence that the bank mislead since the goverment is supporting them. Do they even know the value the bank will buy back before they ask the bank to buy back. What if it turns out to be 10%? WHAT THE POINT?; October 17, 2008 11:28 AM
Anonymous said...: Wow, ready envy the Hong Kong investors. Will Singaporean also be taken care of by their Government??????? Only God will know and only time will tell.; October 17, 2008 11:47 AM
Anonymous said...: Exactly, why is our goverment not doing anything, or speak up for the victims? And MAS always said there r independent bodies looking into the matter why no voices from them. Poor Singaporeans, so helpless.; October 17, 2008 12:33 PM
Anonymous said...: Buying back is a lot a cheaper for the banks than being sued for msis-selling. I am sure they have done their investigation to realise that miss-selling and misrepresenatation were used to sell those rubbish. If proven the banks may have to pay full plus opportunity cost.
I think before agreeing to buy back the victims must make sure it a agreeable to all and not individually to show unity otherwise the unscrupulous banks will exploit; October 17, 2008 12:56 PM
Anonymous said...: H K govt is more caring to its society, compare to Spore govt, which care less, hence People Are Poor (PAP).; October 17, 2008 1:22 PM
Anonymous said...: to anon 11.28 - it doesn't say that they are buying back at current values. let's wait and see the details that shld come out later today. agreed that if it's current values, it's not attractive at all.; October 17, 2008 1:25 PM
Anonymous said...: Can the invester still sue the bank, after the bank buy back the ' BOND '; October 17, 2008 1:46 PM
Anonymous said...: If I want ( or dare ) to invest in 'bonds' again ( though unlikely ), I will do it in HK !

I'll advise my friends/relatives
from Malaysia,Indonesia,Thailand,...to do the same.
Forget about FIs in S'pore !!; October 17, 2008 2:06 PM
Anonymous said...: second class citizens?

First class is the elites in white.
Second class is big companies and entreprrenuers.
Third class is talents(foreigner only)...
...Singaporeans where got 2nd class.; October 17, 2008 2:20 PM
Anonymous said...: http://www.straitstimes.com/Breaking%2BNews/Money/Story/STIStory_291584.html; October 17, 2008 2:31 PM
Anonymous said...: 2.20am
Fully agree with u . Looking at the "COLD" response from the Spore government towards our petition , we had to admit that we are regarded as the "LAST" class or even worse , "NO" class....
SAD SINGAPOREANS !!!; October 17, 2008 3:54 PM
Anonymous said...: I am not too sure what the underlying asset of these "minibonds" are. If they are those toxic mortgage backed securities, well Warren Buffet on the Charlie Rose show (1 Oct) said if he had 700 billions, he would buy them but at market value. MER offloaded $30 bil of them at 22cts to a dollar about 2 months back.; October 17, 2008 4:52 PM
Anonymous said...: After the Straits Times carried the photo of a teary old woman who lost her $100k life savings in Lehman Minibonds, we have the MAS stating that they have started investigations into mis-selling by the financial fnstitutions (FIs). Yah right. Maybe it takes a few suicides for the FIs to start providing some form of restitution.; October 17, 2008 8:56 PM
nhyone said...: HK banks are only offering to buy back at the market price. How is this different from the issuer liquidating the securities and refunding the investors?

I foresee Singapore being more strict with CPF and withdrawal. This is one more reason why the Singapore government do not trust its citizens to manage their own money.; October 17, 2008 11:03 PM
Anonymous said...: Buy back.? At what price?
Do the banks and their swaps experts know something that the investors do not?
How will the investors' interest be protected if no one represent them?
The devil is in the details.; October 17, 2008 11:43 PM
Anonymous said...: In Hong Kong, the banks have agreed to buy back the mini bonds at market value, and the investors will still have the right to sue the banks. It is very likely investors will launch a class action suit against the banks given the stronger vocal citizens there.

In a way, we need to thank the Hong Kong investors who have held many protests against the banks and demand the Hong Kong Monetary Authority for action. Without them, do you think our MAS will act? Note that MAS announcement yesterday (17 Oct) coincideced with HKMA announcement of their action.

I just wondered if our MAS will act if HKMA had not taken the lead first? Hoorays to HKMA and boooos to our MAS!

Strangely, The Straits Times has given very little coverage of the protests in Hong Kong. I watched the television news from HK every night and can see the level of protest there. Why is The Straits Times so quiet about what they are doing in Hong Kong when citizens in both places have bought the same financial products, and faces the same lossess???; October 18, 2008 1:53 PM
Anonymous said...: Singapore's reputation as a safe haven for investors will be forever tarnished because of what DBS and these other issuers are doing, and MAS being bystander until this group of investors came together. If the group didn't come together, they would have rolled over all of us like ants with their very first high handed approach. You can already see the integrity of the company by their response. They know what toxic waste they dumped on unsuspecting investors.; October 20, 2008 12:25 AM
Anonymous said...: Singapore's reputation as a safe haven for investors will be forever tarnished because of what DBS and these other issuers are doing, and MAS being bystander until this group of investors came together. If the group didn't come together, they would have rolled over all of us like ants with their very first high handed approach. You can already see the integrity of the company by their response. They know what toxic waste they dumped on unsuspecting investors.; October 20, 2008 12:26 AM
Anonymous said...: I think MAS will only take this matter seriously when some hopeless investors commit suicide. That is S’pore style. Investigate …. Case by case advice….; October 20, 2008 11:59 AM