Temasek’s 1st retail bond: Riskiest asset class?

I refer to the article “Investors can invest in Temasek’s first retail bond to boost retirement income: Ho Ching” (Business Times, Jun 4).

It states that “INVESTORS can invest in Temasek Holding’s first retail private equity bond to help supplement their retirement income, said Temasek chief executive Ho Ching.

While Singapore has institutions like CPF for retirement, “we think we need to supplement it and companies can participate in this”, she said.

“One of the things we decided to do is to try and make use of our skills and strengths to create new products for individuals to invest for their retirement,” said Ms Ho who was replying to a question from the audience following her speech.

Temasek is now  in the process of introducing a product that allows retail investors to invest in private equity funds, she said.

“As you know these funds are open and accessible to many of you but not necessarily to the broad masses.”

“But by creating a product which is diversified and therefore provides a better risk adjusted return for the individual, we can bring a new category of product to the market for the retail investor,” said Ms Ho.

“So quite apart from things like housing this is another way that we as an institution, …try to bring our skills and knowledge to create products in the future for those who want to invest for their retirement,” said Ms Ho.

Temasek subsidiary Azalea Group is launching a private equity bond with a tranche targeted at retail investors, a structure which is believed to be a first in the world. Azalea pioneered a similar structure here in 2016 when it launched Astrea III, a series of fixed rate notes whose assets – comprising 34 private equity funds – have a current net asset value of nearly US$1 billion.

Azalea has lodged a prospectus for Astrea IV on the Monetary Authority of Singapore’s Opera site. It plans to raise a total of US$500 million from the bond issuance, which comprises three tranches, each designed to target a particular risk appetite.

The least risky tranche is the Class A-1 retail offering amounting to S$242 million. A portion of the retail bonds will be offered to retail investors for subscription via ATMs with a minimum investment of S$2,000.”

I understand that private equity is arguably, the riskiest among the major asset classes (private equity, equities, property, commodities, bonds).

According to investopedia – “What is ‘Private Equity’

Private equity is capital that is not listed on a public exchange. Private equity is composed of funds and investors that directly invest in private companies, or that engage in buyouts of public companies, resulting in the delisting of public equity. Institutional and retail investors provide the capital for private equity, and the capital can be utilized to fund new technology, make acquisitions, expand working capital, and to bolster and solidify a balance sheet.”

“Overall, the risk profile of private equity investment is higher than that of other asset classes, but the returns have the potential to be notably higher.”

At its worse point (from the previous high in 2007) in the last financial crisis (2008/2009) – I understand that the average loss for private equity was about 80 per cent and many private equity funds went into liquidation.

What are your thoughts on investing in these retail bonds for your retirement?

 

Leong Sze Hian

 

 

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29 Responses to “Temasek’s 1st retail bond: Riskiest asset class?”

  • Why now:

    If TEMASEK is doing well with the overseas investments why does it need local retail investors.?
    Is it short of funds now.

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  • Bapak:

    Already no money how to invest? Please release our CPF money than we can consider.

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  • Bystander:

    Better lay off, not guaranteed, and Ms Ho is no fund manager.
    Temasek has a big hole to fill up, dun fall into trap.

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  • Why so desperate?:

    After HSR cancelled and 1mdb money has to be returned to MY,got no money izzit?

    What has the SG version of Rosmah done at Temasek?

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  • HarderTruths:

    Hahaha

    These Temasek funds are also backed by CPF and other $G reserve assets ?

    So are we to invest in another ponzi scheme backed by taxpayer? Using the same money twice – for CPF and now this?

    My my – how desperate they have become!!!

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  • When the bond matures, they will say must withdraw by 36 years installments. Don’t play play ar. Better buy 4D. lol

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  • Ah Peng Kia:

    1. Temasek, with Ho Ching at its helm, lost billions of dollars in investments. Can anyone trust her “skills and strengths” to boost your retirement income?

    2. Singaporeans invest almost 40% of their monthly income for retirement (in the form of CPF contributions), why does that still need boosting?

    3. Singaporeans put aside the most money for savings compared to the rest of the world, why are we among the least able to retire? Poor government policies at play?

    4. Are the government coffers running empty? Is that why the GIC is trying to raise more funds, through the issuance of new retail bonds?

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  • MarBowling:

    Any investment products both foreign and local that Tombmasek under HoLee Jinx or GIC under Mai Hum, touch or invest, think 10 Times bf jumping or joining their Ponzi schemes of things, Period.

    Do your own investing based on knowledge, prudence, Judgement and due diligence. Don’t be OVERCONFIDENT and GREEDY. Always BUY when the Property and Equity Markets crash. Go in only when you FEEL it’s the RIGHT time. Think the Global Property and Equity markets are due for a Mother of all Crashes!

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  • Python 5:

    this is like Bernie Madoff ponzi’s scheme. only much much bigger and a much much longer lifespan.

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  • Python 5:

    funds from retail investors into these fictitious bonds could be siphoned off into LHL and HC personal Swiss or Cayman accounts even before they are invested.

    they can always delay for time and later claim the investment suffered heavy losses when the next financial crisis hits the market.

    an investment scheme devised by TH, led by LHL and HC and monitored by MAS?? you dare to invest??

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  • Kiasu Land Got No Law!:

    That’s what the new Malaysia AG says about Law in Singapore.

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  • President Must Audit TH!:

    If you want citizens to accept and respect your office, please do the right thing.

    Carry out your duties diligently and the People will trust and back you.

    Check and Check Now!

    It is your calling and the People are waiting!

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  • Leejiapore:

    Why the Central Ponzi Fund keeps holding out money beyond 55? Why complicate matters? Just pay us the same interest as Malaysian EPF. You mean the Malaysian dishonorable son boleh, and Singaporean dishonorable son tidak boleh! Now the wife have to step in.

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  • Invest or spculate:

    When someone offers the man on the street something that is meant for the rich and sophisticated, you can be sure this product is not wanted by the rich and sophisticated. Bear in mind, why would the rich share their investment spoils with the masses? Those rich people who really want to help those less fortunate would have done so via philanthropic means

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  • patriot of Temesak:

    LEEgal Ponzi SCHEME!!! don’t be fooled…have all of you NOT been Fooled Long enough??? STOP Bleating YesSir!!! YesSir!!! I AM a FOOL!!! and let the BASTARDS get away with it Over & Over AGAIN!!!

    Ask YOURSELVES this…If the RESERVES are that GREAT!!! why need to BORROW MORE from the People!!!… The RESERVES is an ILLUSION just like the ILLUSION the bast**d now DEAD created for the world to see…YOU are LIVING The Reality and Paying for it!!!

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  • Lasting Wisdoms:

    Anything from PAP better avoid.

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  • N.Jungne:

    TRE Tech:
    When the bond matures, they will say must withdraw by 36 years installments. Don’t play play ar. Better buy 4D. lol

    Response: Likely, tan ku ku

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  • Masquerading Snakes:

    Cannot don’t answer to international institutional investors.
    That’s how 1MDB scam was unravelled. Other governments will fight for their business entities.
    To local sinkies investors, they could lie, cheat, delay returns, declare zero value, steal, arm twist and brush you aside.

    This is how evil they have become.

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  • oxygen:

    @ Invest or speculate

    I NEED TO CONSULT a street fortune-teller before putting any money into this retail bonds. They must be clairvoyant, that is why they are still self-employed and I am still very poor!

    Invest or spculate: When someone offers the man on the street something that is meant for the rich and sophisticated, you can be sure this product is not wanted by the rich and sophisticated. Bear in mind, why would the rich share their investment spoils with the masses? Those rich people who really want to help those less fortunate would have done so via philanthropic means

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  • Save Singapore Fund?:

    Singaporeans no more stupid!

    If GE is held tomorrow, there will surely be a New Gahment!

    Present Gahment needs to GO!

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  • cpfgone:

    Wa serious later on maturity they will say you are healthy can live until 100 years old so can only draw at 100 years old.

    Better not playing play.

    CPF already delay and pay us in installments now another ponzi bond????

    Better don’t v risky. CPF already trapped now another scheme.

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  • Better con Gorilla bonds:

    No time to wait for the daft’s medilife n carelife to atch Gorilla appetite for billions gamble with 99% losing confidence. Now have to fill the gabs of the North Koeran PAP prime idol of greed, hungen brutishness. The 3rd 4th cesspools as usual think SIN national fund is for them to throw to gain a bearvhug and a pat on the heads of then Biw us dogs. Cant even do anything l domestically yet the arrogant biws eunocd shamelessly claimed to be trusted by their bigvangmo lp to be fair moderator when they cannot even treat sinkists justly including own siblings who know too much for their own good. PRC Xi gang must be giggling uncontrollably bananas r bananas so familiar to him particularly their own billionaire shitsvwhich he desperately try to ward off the lame baby gorilla hiding behind the bull stink angmokou.

    It is an international shame to be bullied n blackmailed tovprovide full board n allowance oerhaps else they would not have a chance to suck up to the angmo lp. Despicable shits eroding national dignity n y. If Kim has no intention to meet Trump what business is lhl to waste millions, manpower and considerable inconvenience to Sinkies. Traitos have to be booted on e out of the Parliament which they have consistently violate its integrity n dignity but not attending on national issues while to be seen when the little gorrilla tried to wash away shit thrown at it while being overseered by the stupidus extremus gorilla lurking behind for the deafs dols to be scattered among the redhair demon just to gain a few pat on the oversize butt.

    Despicable biws.

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  • pap clown and his S$m gang:

    can clown pap be trusted? surely NOT.

    so can citizens’ trust clown pap temasick? of course NOT.

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  • Bobo:

    Tomysick HC wants to help the poor also? The hubby has been of great help to the poor already. The poors became poorer and poorest. Poor in knowledge, poor in cash, poor in family management, poor to protect this counrty etc.

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  • Midas Touch doesnt live here:

    Everything she touches turns to ashes..
    Dont dive in… go in with eyes big big…
    We asked for the ‘Midas Touch’ , but all we got is the ‘Middle-finger Monkey Touch”..

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  • Asd:

    Take fat salary.. Make $ get big fat bonus… But what has the citizen gotton ?
    Lose $ also get salary.. Lose $ tax more la doesn’t matter cos own pocket get fill can Liao

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  • KelvinWang:

    From somebody who lost half a billion in a poor investment in the 90s, stay out of it.

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  • Return CPF money:

    No need to get them to invest ..

    Just return the CPF money to them and make their HDB flat still valuable…
    Not zero value at end of lease…

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  • OMG:

    If you got money, better keep in bank for safekeeping. Don’t be bothered by the interest rate.

    - At least you know your money is safe.
    - Anytime you want to withdraw your money you can do it.

    All investments are subjected to risks, why take the risks when we are reaching our retirement age. Don’t listen too much to investment managers, they are just like us, working class. If these investment managers are so good, they would be millionaires themselves, no need to sell investment products to you.

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