Tan Kin Lian's Blog: Town Council invest in Minibond

Tuesday, October 28, 2008

Town Council invest in Minibond

Mr Tan,

Even Town Council use the resident sink fund to invest in Minibond , sorry can't tell you the name of the TC.

Invest around 300k, ....... many more MCST too have invest in it, So just simply write off public fund, it is legal?

Hope more people can surface more related info, to add on the pressure.

Eric

30 comments:

Anonymous said...: PLS GIVE SOME PROOF, if not this could easily be construed as another case of calling the Police Crooks simply you werent allowed bail; October 28, 2008 1:36 AM
nhyone said...: What is MCST?; October 28, 2008 8:08 AM
Anonymous said...: As a matter of fact i have been pondering about a related question for a long time.
DID GIC (our governement investment corporation) INVEST ANYTHING IN LEHMAN OR OTHER TOXIC FUNDS LEADING TO LOSSES which indirectly affect cpf or other citizen funds?

I wouldnt blame GIC or the Town Council for making such mistake as well. Governments ALL OVER THE WORLD are suffering from such bad investments. How much they will tell the citizens about it is up to the government. We probably wouldnt be told, so it is a silly question.

rex; October 28, 2008 8:25 AM
Anonymous said...: MCST and presumeably Town Councils too, cannot invest other than in fixed deposits.

If what you (1:08 AM) said is true, it is clear dynamite (especially the Town Councils). In the MCST the Council and the managing agent can be sued by the sub propriators.

In any case, why should you hide under the cloak of "anoymous"?

If you are genuine then go public and we will support you.

Chew Boon Keng; October 28, 2008 8:48 AM
Everlearning said...: Everyone knows the answer. No one dares to question.

Since when are we supposed to know the truth from them. We are living in a make-believe society all this while; every thing they do is for our own good.

Nobody is believing what the leaders of the world are trying to fix this financial crisis. It looks like the financial maket does not respond towards their rescue plans. All confidence is lost! The damage is way too big to be patched!; October 28, 2008 8:58 AM
Anonymous said...: MCST is Management Corporation-Strata Plan. All the condominium have their own management to manage their management fund & sinking fund. Some of have even has few millions in their funds,they can invest in FD, preference shares, or according to Eric, even in structured product(of course I don't think they are aware that they are buying into the toxic product).; October 28, 2008 9:23 AM
Anonymous said...: This comment has been removed by a blog administrator.; October 28, 2008 9:32 AM
Anonymous said...: Yes, I saw over Channel 5 news a few weeks ago that Dr Teo Ho Pin MP for Holland-Bukit Panjang Constituency said they were exposed to Lehman.

My next reaction is why arent we looking instead at reducing the service conservancy cost when we have so much funds.

Can dig up old news reporting to confirm this?; October 28, 2008 9:57 AM
Anonymous said...: Here are 2 links that could help clarify the position on Town council Investment

http://www.938live.sg/vgn-ext-templating/v/index.jsp?vgnextoid=ff9117b1b43fc110VgnVCM1000001f0aa8c0RCRD&mcParam=18d2638896593110VgnVCM100000e101000aRCRD

http://www.channelnewsasia.com/stories/singaporelocalnews/view/315072/1/.html

(source CNA and 93.8live); October 28, 2008 10:20 AM
Anonymous said...: Hi Eric,

I am Zhi Yuan, Chief Editor of Wayangparty news blog.

I receive an email about this too.

Do you have more information ?

Once we can pin down the TC involved and independently verifed it, we will publish it for all to see.

This will be sensational news.

Please contact us asap at:

wayangparty@hotmail.com

Thanks.; October 28, 2008 10:20 AM
Parka said...: What's the point of this entry if not to give the name of the Town Council?

Is the information even substantiated in the first place. If so, this makes for a pretty big news story for whichever newspaper to break it.; October 28, 2008 10:28 AM
Anonymous said...: "DID GIC (our governement investment corporation) INVEST ANYTHING IN LEHMAN OR OTHER TOXIC FUNDS LEADING TO LOSSES which indirectly affect cpf or other citizen funds?"

I always tell my students to engage in wider perspective and not think too narrow. It is not a question of whether the gov invest directly in Lehman but rather "indirectly".

The answer lies in my question.
"Are there any investments make by Lehman that are also made by Citibank, merril lynch or any other gov's invested FIs ?" Assume that Lehman make a major investment in a certain project, how do you think the rest of FIs which are stakeholders in the project will fare, and don't you think the project will need to be bailed out by rest of FIs given that Lehman is bankrupted ?

Think along this line and you find the answer.; October 28, 2008 3:52 PM
Anonymous said...: Today Channelnewsasia, TC is involved but MP said that the amount is not alot?? But they never announced the amount? 100k, 200k, or 1m...etc

To me, that is public fund, a mis-appropriate of public fund...right?

Surprise, no investigation, no details?

Wondering why the head of TC approving this type of investment??

Are they misled too??; October 28, 2008 11:59 PM
Anonymous said...: According to BUILDING MAINTENANCE AND STRATA MANAGEMENT ACT 2004, Management funds and sinking funds
38. —(1) A management corporation shall establish and maintain a fund as its management fund.

(7) A management corporation may only invest any moneys in its management fund or sinking fund in any manner permitted by law for the investment of trust funds.

What is trust funds? Is Minibond trust funds?

I sat in Mgt Council before, the experienced members and the Mgt Agent told me they can only put the monies in FD.; October 29, 2008 12:32 AM
Falcon said...: I am of the opinion that a caring government would use the excess funds to lower conservancy charges in these difficult times to help residents rather than invest and lose these same funds in some toxic schemes.
To be fair to them, they may not be aware that these funds are toxic but it also reflects that they are not worth the high salaries paid to them if they are not able to differentiate just like those vulnerable groups without an education.; October 29, 2008 2:04 AM
Anonymous said...: I wonder if the TC will be considered as the "knowledgeable and experience" group. With a full management team staff with MPs and professionals, surely they are more knowledgeable and experience than ordinary investor with secondary or even tertiary education.; October 29, 2008 7:19 AM
Anonymous said...: Even a team of experienced staff in TC (some experienced in fin) also thought such product is safe. Is it fair to assume that ordinary people with some education (even up to tertiary) can also be misled into thinking that such products are safe?; October 29, 2008 7:36 AM
Anonymous said...: Anonymous @ 7:36 AM,

That's exactly my view too! I wonder if Mr Heng of MAS is reading this.; October 29, 2008 8:54 AM
Anonymous said...: I watched the news on channel U last night and the spokesperson claimed that only a few per cent of the cash holdings, which can be as large as $100 mil, were being invested in Lehman. I can't believe that he said so in a laughing manner when the amount translates to around a possible few million of tax payers dollars! I mean, c'mon, this is a serious matter, why taking it easy with the smiley face even though not your own money?! At the very least, pretend to be care a bit!; October 29, 2008 12:17 PM
Everlearning said...: It is not a matter of just a minimal exposure to the toxic product, nothing to worry about.

It is the way that TOC conducts the matter in the eyes of the public speaks well or bad of their management of the public funds.

They should not be light-hearted. written it off and let the matter rest.

Evidently, they too are misled by the bad products.; October 29, 2008 1:17 PM
Anonymous said...: "Maybe a couple of percentage out of the total investment portfolio (were used in those investments), so the exposure will not affect the overall investment portfolio or the sinking funds per se. There's definitely no fear that any of the PAP town councils' sinking funds will be wiped out. All the supporting PAP town councils' sinking funds are in safe hands," assured Dr Teo Ho Pin, Coordinating Chairman of the 14 PAP Town Councils. He is also the mayor of North West District.

"Every PAP town council has between S$30 million and S$150 million in their sinking funds."

Simple calculation of (min) $30 mil per TC * 14 TC = $420 mil (min). A couple of per cent = 2%, therefore $8.4 mil (min) invested to Lehman-linked products.

Max loss is 5 x $8.4mil = $42 mil.; October 29, 2008 1:46 PM
Concerned said...: The executive councillors who made the decision to invest in such structured products should made good the losses suffered. These are public funds; October 29, 2008 3:48 PM
Anonymous said...: Is there any town council involved in the minibond saga?
If so, this is real serious because the residents will be seeing hikes in their monthly bills soon.

Jasmin; October 29, 2008 4:21 PM
Anonymous said...: Wonder besides TC, any GLCs hv direct exposure to the minibonds, or similar CLS products?; October 29, 2008 8:05 PM
Anonymous said...: If years ago gic has decided that structured products should be avoided, why such products still allowed to be sold to the retail market?
Is it a social resp. to help the general public, and may be also to other orgs to prevent them from using public funds to buy such products?; October 29, 2008 8:25 PM
Anonymous said...: Will they be saying that the investment is for long term? Or will they say this is an honest mistake, let's move on? or will they say that they will be worried if they don't lose this money? or will they say this is to help the poor?; October 30, 2008 1:57 AM
Anonymous said...: Why I do not see any news about the TC invested minibond in the newspaper? Is the media trying to cover up?; October 30, 2008 10:11 AM
Anonymous said...: The newspapers say some TCs have limited exposure to LB linked products. We do not know which one and how much. What we are interested to know is whether the TCs considered the products were mis-sold to them, and if so, are they lodging their complaints to the FIs. If they have invested in the products knowing very well the risks associated with such products, then they are playing fire with public funds.; October 30, 2008 10:16 PM
Anonymous said...: "When investors make profits, they never complain, when the investors incur losses, they make noises".

********************
"When the experts? make losses, they keep quite; when they make profits, they want the whole world to know they hv done a good job, and incr the salary".; November 01, 2008 8:59 AM
Anonymous said...: I was just wondering why the question about the amount of money in the sinking fund not questioned.

Is there a cap to the amount we need in the sinking fund? It cannot be that it is allowed to grow forever.

Once the cap is reached, should the conservancy be cut?

Should the sinking fund then be forced to observed acceptable investment guidelines much like how citizens have to observe these with the CPF funds?; November 23, 2008 8:10 AM