Thursday, February 12, 2009

Temasek's Performance

Temasek Holdings' net portfolio value dropped 31% between March 31 and Nov 30 last year, from S$185 billion to 127 billion, Senior Minister of State for Finance Lim Hwee Hua revealed in Parliament yesterday.

Fund managers yesterday called Temasek's performance "respectable" because it was less than the 44% decline in the MSCI Singapore Index and the 45% decline in the MSCI Asia ex-Japan Index. What a Joke!

I will be ashamed of such performance, no excuses, mistakes after mistakes were made acquiring the various foreign assets that tank. These highly paid Fund managers were the best in the industry, they should be made answerable to the billions lost on paper. Their timing was horrible! Temasek would have save at least a couple of billions to help spur the local economy.

All of us make mistakes and we have to admit the mistake instead of giving lame excuses such as expected returns over a 20-year horizon, and not the actual year-to-year returns. It will take many years just for Temasek to beak even not to mention about returns. What about the opportunity cost?

I can understand the time horizon for Temasek's investment, probably over many years, but buying into a fast falling market and underestimate the extend of the fallout is unacceptable for an organisation with all the brilliant people and resources available.

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