Tan Kin Lian's Blog: Hear the voices of High Note 2 investors

Thursday, November 13, 2008

Hear the voices of High Note 2 investors

Posted at request of LK and HNIGHN2WG

After attended the dialogue with DBS, we cannot accept the ‘case by case’ investigation recommended by DBS. A petition consists of 83 investors is on the way.

In order to beef up our case against DBS for Non-Disclosure of Material Fact & Misrepresentation/Mis-Selling, we are conducting a survey/questionnaire to identify trends/selling patterns of different RMs, branches, etc to make it easier for us to argue our case.

More people mean more muscles to engage DBS!

We urge other High Notes 2 investors who are not aware of this petition, please come down to Mr Tan Kin Lian speak at Hong Lim Park (next to Clarke Quay MRT station) this Sat 15th Nov, from 5.00~7.00pm evening to join us in this petition.

We can also meet & discuss on our follow-up action.

LK
On behalf of HNIGHN2WG

9 comments:

Anonymous said...: Let me see what is the feature & problem in HN2 -

DBS HN2:

FTD Basket with 8 REs.

CDO basket AA-rated basket of securities held by Constellation, the company owned by DBS and is the counter-party with DBS for various swap contracts.
--THIS IS THE UNDERLYING ASSETS I SUPPOSE.--
--DBS'S JOINED LB & MS BANWAGON on SPECULATION & HEDGING of THEIR HUGE CDOs EXPOSURE I SUPPOSE.
--DBS'S CDO EXPOSURE AS AT 30 SEP 08 AMOUNTED TO $1,425M. ABS CDO $263M & NON-ABS 1,162M. REPAYMENTS OF $143M EXPECTED IN NEAR TERM. hedging amounting to $264m of exposure taken.

There are 100 names in the list and that only 25 names are rated AA or better. There are 22 rated BBB+ or below. AA- to A- accounted for the balance 53.

On 23.9.08, the basket of securities was re-rated as BBB+.

The worst thing is after the defaults of 3 names in the basket of securities, the bank informed investors that a further 2 defaults would trigger a credit event.

--If the collateral becomes insufficient to secure the obigation of Constellation under the Reference Notes (CDO reference portfolio I suppose), the Reference Note may be redeemed early.
--3 failed reference CDOs are LB, Freddie Mac & Fannie Mae.
--Need urgently to study the other 97 reference CDOs on probability to fail.
--What is the subordinate level to hold the credit event of CDO credit default?

Ask DBS chairman!; November 13, 2008 12:04 PM
Anonymous said...: Interestingly now the issuers are starting to reveal what is in the rotting "underlying securities", after reading the posts on the blogs on their scams. Many victims are now receiving letters saying "hard luck" but by the way you have been investing in these useless securities tied to useless banks :

if victims were told before they sign the dotted line, with "eyes open wide wide", that they were swapping risks with issuers on "synthetic CDO securities", "CDO squared securities". "credit commodity linked securities" , "asset backed securities", with "world-famous" banks like Glitnir banki hf, Kaupthing banki hf, Landsbanki Islands hf, and many many more exotic names, would any customer even bother ? ( unless you are so trusting of the distributors ).

Did we really see with our wide wide eyes the names of these exotic "world-famous" banks which no one in Singapore have heard of, and the exotic securities which even the Regulator will have been surprised ? And it is "case closed ? "

Why are we defending/protecting investment banks which manufactured these poisonous products when every one of them has been indicted/prosecuted/fined in US and EU ?; November 13, 2008 2:43 PM
Anonymous said...: Hi 2:43 pm ,

Your questions:
1. Did we really see with our wide eyes the names of these exotic "world-famous" banks which no one in Singapore have heard of, and the exotic securities which even the Regulator will have been surprised ? And it is "case closed?”
2. Why are we defending/protecting investment banks which manufactured these poisonous products when every one of them has been indicted/prosecuted/fined in US and EU?

The best persons in Singapore to answer your questions are: Mr. Lee, Mr. Goh and Mr. Koh.; November 13, 2008 3:23 PM
Anonymous said...: A petition of 83??

Good luck, and I thought I need it more.; November 13, 2008 3:36 PM
Anonymous said...: No way U can see even U open yr eyes wide wide.
During the accumulation phase the CDO list had not been drawn. So U see open eyes wide wide but see what?. Nothing.
There is a determining agent to decide what will be in the CDO list. Who are involved? Surely be the trustee and the issuer. Here, one seems to forget the role of the TRUSTEE. For HN2, the rating agent was called upon to give the AAA, AA,..rating and the most wonderful part was that Freddie & Fannie were all AA rated as the brochure, pricing statement & Base Prospetus said that only AA rated were considered.

Was MAS given the list of CDO to disapprove if it saw something wrong? Or it is not the role of MAS?

DBS, the de-facto Nat Bank mah? Die Die must sell HNs. CDO exposure so huge, any three long two short how to tell shareholders? Who is the major shareholder? TH mah, think about 28% stake. How shocking to hear $13m loss in LB product but luckily got HN5 to hedge, no big deal! $143m is expected to return safely BUT to add to the provision of $129m for CDO exposure. Hedging amounting to $264m of exposure taken. CDO exposure as at 30 Sep 08 amountin to $1,425m hoh! ABS CDO $263M & Non-ABS CDO 1,162M. So HN2 for what use? To hedge loh afterall ,this is not HN5 FTD debacle and not LB counterparty fiasco and it is NEW CASE - CDO basket default.

Tell him I OPEN two EYES big big not enough. One EYE could see FTD the other see COUNTERPARTY, got no more EYE to see CDO basket.

I need the 3rd EYE open big big!; November 13, 2008 3:37 PM
Anonymous said...: What is the meanings of trust?
What is the value of trust?

In good times, they make tons of money, do we get any? Who were distributed with all the profit?

In bad time such as this, who suffer? So they said it is yr fault, it is due to bad timing, etc. But they are still enjoying. Is it fair?; November 14, 2008 6:44 AM
Anonymous said...: Retrenchment:
In good times, they get receive so much money & bonses.
The ave employees may get a little more, just to survive, and with very little savings.

In bad time, the ave employees are the 1st to go. Without savings, how to survive?
Some even loss their savings in this saga.
The "lucky" ones (whom we "trusted") already hv savings that can last them many hundreds years. And they still keep their jobs, they still laughing all the ways to the banks every mth. When things improve, they will be the
1st to get pay rise, and more bonuses. Is it fair?
What is the meaning/value of trust / justice?; November 14, 2008 6:53 AM
Anonymous said...: Why the heck is the every day common man harping on Trust and Justice

Dont he realise they DONT apply, well to him.

Face Reality!; November 14, 2008 12:58 PM
Anonymous said...: Dear fellow HN2 investors,

Out of the three CDO that has credit event, I think only LB is the "jialat" case, requiuring a payout of about 92%. Freddie and Fannie only payout about 8%. So DBS should come out and clarify that it is not a case whereby two more company in the underlying CDO credit event would result in redeemption....

DBS should show all HN investors what is the worst case for the portfolios, all detail calculation and what is the basis/condition for for them to redeemp the different notes series.

regards; November 15, 2008 10:35 AM