Dear Kin Lian,
I read you blog with interest everyday and after hearing about this fiasco with the minibonds. I am glad that I had left the banking sector many years ago. I have no interests in any of the minibonds. Things may have changed now, but I would like to relate my experience as a RM in a local bank then.
I personally feel that banks should try not to sell so many different types of financial products to the mass market.
This should be done by the broking housings as they are more equiped to do so. Anyway back to my experience.
During the haydays when units trust were just being introduced to the markets, I remember Aberdeen Global Tech Fund was trading about 1.90+ many banks were scrambling to earn commission given by the fund houses. (There was an upfront sales charge of 5%, how much given to the bank, I am not sure.) Banks were flushed with Fixed Deposits and management was very short sighted. why? Because it was a liability for the bank to hold fixed deposits.
As bank sales staff, we were like attending fund launches almost every week. The product manager would come in, talk a little about the fund and give us sales target. Also started to say what customers are suited. With sales target, what does it mean? It means you need to milk you customers. We were given customers details especially those that were going to expire and also made to stay after work to make calls to them to `recommend' them this product.
Well, as sales people, we can't argue right. We were employed to do sales. How we achieve it is not they problem, just sell and be rewarded with commissions. But at the same time, we were named Financial Planner. What about this?
I remember that there was this time that the bank was selling `capital protected' funds. Of course we knew that Capital Protected is a marketing gimmick. Your capital is protected less certain charges.
Anyway, I was in mass market sales. There was a bank staff that managed to persuade a customer to place SGD 2.5 milllion in the fund.(Guess what, the fund total size was 50 mil) Any financial planner would know that is not the way. It would be best to diversify to Cash account, Fixed Deposits, Equity funds, etc). We were like shocked when we heard this.
One more point to add, usually bank sales staff have a limited time to do sales and they are taught to close the seal in the shortest time possible. (We were actually taught to close a `long term saving plan' in 15 minutes.(which is actually an insurance plan) I am not against this, but wouldn't it be better to take some more time to explain to customer if she/he actually needs this?
Let me say again, this happened many years ago. I don't know whether is it the same. If you are saying that banks had introduced the FNA (Financial Needs Analysis) signed by the customer, let me ask you one thing, WAS IT DONE PROPERLY? Do you think the aunties and uncles who do not speak English know what this document is about? I can tell you they just sign the document based on the trust of the bank or the sales staff.
This is all I have to say. Thank god I left that industry.
LW
Thursday, November 20, 2008
Social grace in commenting in other people's blog
I wish to thank Everlearning for this comment in my blog:
Hi Mr. Tan
Coming back to this blog ..... (I was shocked) to read some unhappy comments. As a guest, I have no rights to impose my host in whatever way in his house. I suppose bloggers have to exercise some discreet and courtesy when commenting in other people's blog. This is social grace.
MY VIEWS
I have received several personal attacks and sarcastic comments by people posting anonymously or under a false name. They expect their comments to be published here in the name of "presenting the other view". I expect these people to use their real identity, if they wish their contrary views to be posted.
Hi Mr. Tan
Coming back to this blog ..... (I was shocked) to read some unhappy comments. As a guest, I have no rights to impose my host in whatever way in his house. I suppose bloggers have to exercise some discreet and courtesy when commenting in other people's blog. This is social grace.
MY VIEWS
I have received several personal attacks and sarcastic comments by people posting anonymously or under a false name. They expect their comments to be published here in the name of "presenting the other view". I expect these people to use their real identity, if they wish their contrary views to be posted.
Mental health concerns during difficult times
Dear Mr. Tan,
First of all, thank you for all the help and info you provided in your blog and in Hong Lim Park.
With the recent saga over the structured products and mini-bonds, most of the affected investors are going through emotional stress as well as financial stress.
Sad to say that I am also exposed to one of the products and have to go through emotional “struggle” everday.
On one side of my mind, I have to stay alert to handle the daily routine, the other side worrying on what will be the outcome of my hard-earned money … etc
I believe that all investors are affected will be going through the followings : before taking every steps, during the process and while waiting for more info, you have to go through the stressful grinding of you brain (and heart) again and again.
> Complaining to the FIs …..
> Waiting for reply ….
> Going to FiDrec ….
> Waiting for more info from the news ….
> Will I get back my hard-earned money … how much … when …
It is like, going forward, but dragging your feet in a muddy field.
It is like, when you are taking a break, you mind is still spinning.
It is like, when your child gives you a smile, you have to put in extra effort to move your facial muscles to reply his greeting.
It is like, you want to shut down the computer, but the hard disk refuses to stop and keeps spinning.
It is like, you want to sleep, but you are worried about the outcomes.
It is like, you want to sleep, but you are also worried about other investment on hand that may have “toxic ingredients” in them.
BUT don’t know how to check, don’t know whether you should believe you RMs or insurance agents (or friends that you have bought from). Not saying that they are lying but they may not have the knowledge to “detect” the “toxic ingredients”
This list will go on and on and on and on … …
With all said above, I would like to chip in some of my thoughts that I think it will be helpful to all the distressed ones :
Calling all volunteers from appropriate organizations, reach out to these people to help relieve their emotional stress, especially the old folks, uneducated ones and those that are all alone (either they have no friends and relatives to approach for help, or they are afraid to let them know about they involvement in the structured deposit products)
Seek medical help if you are having problem coping with the stress and having problem sleeping at night. I have done so. I have to “force” myself to sleep by taking the medication from my doctor, so that I can handle the routines in the day.
This is a list of useful phone numbers that I have found from the web :
Samaritans of Singapore (SOS. 24 hrs) 1800-221-4444
Singapore Association for Mental Health Helpline 1800-283-7019
Care Corner 800 Hotline (in Mandarin, 10am-10pm daily) 1800-353-5800
Touchline Mon-Sat (10am-10pm)(for 13 to 25 year olds) 1800-377-2252
BABES (For teenage girls facing pregnancy crisis) 1800-833-6666
Pregnancy Crisis Service Mon-Fri (9am-5pm), Sat (9am-1pm) 6339-9770
Association of Women for Action and Research Helpline (AWARE) Mon-Fri (4pm-10pm) 1800-774-5935
National Family Service Centre (FSC) Helpline 1800-2255-372
SENIORS helpline (for older persons and their care-givers) 1800-555-5555
TOUCH Caregivers Centre 1800-352-1622
SAGE helpline Mon-Fri (9am-5pm), Sat (9am-1pm) 1800-3538633
Alcoholics Anonymous 6475-0890
Eating Disorders Helpline - Tel: 6345-3435 (10:00am - 4:00pm Phone Mail Mon-Fri
Source : http://www.giftoflistening.com/resources.html
Thank you Mr. Tan for being so helpful and kind, and taking your time to read this letter.
My wife and I are so stressed that we have to seek medical help so that on top of our busy daily routine, we will not neglect our toddler son and of course our health.
This is in fact the main message I would like to get across to all the distressed and worried ones out there. While fighting for what we believe is right, we still have to take good care of ourselves and our loved ones.
God Bless All !
FO
First of all, thank you for all the help and info you provided in your blog and in Hong Lim Park.
With the recent saga over the structured products and mini-bonds, most of the affected investors are going through emotional stress as well as financial stress.
Sad to say that I am also exposed to one of the products and have to go through emotional “struggle” everday.
On one side of my mind, I have to stay alert to handle the daily routine, the other side worrying on what will be the outcome of my hard-earned money … etc
I believe that all investors are affected will be going through the followings : before taking every steps, during the process and while waiting for more info, you have to go through the stressful grinding of you brain (and heart) again and again.
> Complaining to the FIs …..
> Waiting for reply ….
> Going to FiDrec ….
> Waiting for more info from the news ….
> Will I get back my hard-earned money … how much … when …
It is like, going forward, but dragging your feet in a muddy field.
It is like, when you are taking a break, you mind is still spinning.
It is like, when your child gives you a smile, you have to put in extra effort to move your facial muscles to reply his greeting.
It is like, you want to shut down the computer, but the hard disk refuses to stop and keeps spinning.
It is like, you want to sleep, but you are worried about the outcomes.
It is like, you want to sleep, but you are also worried about other investment on hand that may have “toxic ingredients” in them.
BUT don’t know how to check, don’t know whether you should believe you RMs or insurance agents (or friends that you have bought from). Not saying that they are lying but they may not have the knowledge to “detect” the “toxic ingredients”
This list will go on and on and on and on … …
With all said above, I would like to chip in some of my thoughts that I think it will be helpful to all the distressed ones :
Calling all volunteers from appropriate organizations, reach out to these people to help relieve their emotional stress, especially the old folks, uneducated ones and those that are all alone (either they have no friends and relatives to approach for help, or they are afraid to let them know about they involvement in the structured deposit products)
Seek medical help if you are having problem coping with the stress and having problem sleeping at night. I have done so. I have to “force” myself to sleep by taking the medication from my doctor, so that I can handle the routines in the day.
This is a list of useful phone numbers that I have found from the web :
Samaritans of Singapore (SOS. 24 hrs) 1800-221-4444
Singapore Association for Mental Health Helpline 1800-283-7019
Care Corner 800 Hotline (in Mandarin, 10am-10pm daily) 1800-353-5800
Touchline Mon-Sat (10am-10pm)(for 13 to 25 year olds) 1800-377-2252
BABES (For teenage girls facing pregnancy crisis) 1800-833-6666
Pregnancy Crisis Service Mon-Fri (9am-5pm), Sat (9am-1pm) 6339-9770
Association of Women for Action and Research Helpline (AWARE) Mon-Fri (4pm-10pm) 1800-774-5935
National Family Service Centre (FSC) Helpline 1800-2255-372
SENIORS helpline (for older persons and their care-givers) 1800-555-5555
TOUCH Caregivers Centre 1800-352-1622
SAGE helpline Mon-Fri (9am-5pm), Sat (9am-1pm) 1800-3538633
Alcoholics Anonymous 6475-0890
Eating Disorders Helpline - Tel: 6345-3435 (10:00am - 4:00pm Phone Mail Mon-Fri
Source : http://www.giftoflistening.com/resources.html
Thank you Mr. Tan for being so helpful and kind, and taking your time to read this letter.
My wife and I are so stressed that we have to seek medical help so that on top of our busy daily routine, we will not neglect our toddler son and of course our health.
This is in fact the main message I would like to get across to all the distressed and worried ones out there. While fighting for what we believe is right, we still have to take good care of ourselves and our loved ones.
God Bless All !
FO
Much to learn from American politics
When John McCain lost the election, he gave a magnanimous speech conceding defeat and pledging to work with Barack Obama as "my President".
In turn, Obama acknowledged McCain's long record of dedicated public service to America. He pledged to work with McCain.
Obama met with McCain a few weeks later to discuss how they can work together to solve America's problems.
Here is a country with 60 times the population and talent pool of Singapore. They know how to work together to find the best people to solve their problems.
In Singapore, we have a limited talent pool. We need to find a way to tap the best of our limited talents. We should rely on our local talents, instead of foreignt talents who do not have a long term interest of our nation.
In turn, Obama acknowledged McCain's long record of dedicated public service to America. He pledged to work with McCain.
Obama met with McCain a few weeks later to discuss how they can work together to solve America's problems.
Here is a country with 60 times the population and talent pool of Singapore. They know how to work together to find the best people to solve their problems.
In Singapore, we have a limited talent pool. We need to find a way to tap the best of our limited talents. We should rely on our local talents, instead of foreignt talents who do not have a long term interest of our nation.
Top up on margin calls
If you borrow money and pledge shares, the bank will check the prices each day. If the values of your holdings fall below the amount borrowed less a safety margin, the bank ask you to put in additional money. If you do not, you have to sell the shares at its depressed prices. This is called "margin call".
This causes the prices to fall further. As they are no buyers, the prices can drop a lot. This triggers more margin calls.
Solution: do not invest with borrowed money. Invest with long term savings.
This causes the prices to fall further. As they are no buyers, the prices can drop a lot. This triggers more margin calls.
Solution: do not invest with borrowed money. Invest with long term savings.
Relief loans to repay credit card debts
Many people expect the next big financial crisis to be triggered by the failure of the credit card debts.
I hope that action can be taken to minimise the impact of this impending crisis. I believe that a large number of people borrowed on credit cards due to reduction or loss of their earnings. The high interest rate on the credit cards add to their burden.
I suggest that a relief loan be provided to these people who have runned up the credit card debts for this reason. This relief loan can help them to reduce their heavy debts. My proposal for this relief loan is set out below:
http://tankinlian.blogspot.com/2008/11/relief-loans-to-replace-loss-of.html
I suggest that the banks should give a discount on the repayment of the credit card debts through the relief loan. As they have earned a high rate of interest before, they should take a reduction in return for the repayment of the loan.
I also hope that a limited amount of relief loan be given to other borrowers who have incurred a credit card debt for other reasons, e.g. over-spending.
The relief loan, charged at a modest rate of interest, will give the borrower a better chance to repay the borrowings, and prevent another round of financial crisis.
This targeted approach is better than giving every person a cheque under a stimulus package (as was practiced recently in USA).
I hope that action can be taken to minimise the impact of this impending crisis. I believe that a large number of people borrowed on credit cards due to reduction or loss of their earnings. The high interest rate on the credit cards add to their burden.
I suggest that a relief loan be provided to these people who have runned up the credit card debts for this reason. This relief loan can help them to reduce their heavy debts. My proposal for this relief loan is set out below:
http://tankinlian.blogspot.com/2008/11/relief-loans-to-replace-loss-of.html
I suggest that the banks should give a discount on the repayment of the credit card debts through the relief loan. As they have earned a high rate of interest before, they should take a reduction in return for the repayment of the loan.
I also hope that a limited amount of relief loan be given to other borrowers who have incurred a credit card debt for other reasons, e.g. over-spending.
The relief loan, charged at a modest rate of interest, will give the borrower a better chance to repay the borrowings, and prevent another round of financial crisis.
This targeted approach is better than giving every person a cheque under a stimulus package (as was practiced recently in USA).
Poor return from Living policy
Dear Mr. Tan,
I bought a Living policy with NTUC when you were CEO. Lately, I read that you recommended against the Living policy. Can you clarify?
REPLY
I have just surrendered my Living policy. After paying premium for 12 years, my cash value is still below the total premiums paid.
In the earlier years, the bonus was quite attractive. Later, the bonus was cut due to the economic downturn in 2003.
There was a chance to restore the bonus earlier this year, before the financial crisis, but the management refused to do so. I have decided to terminate the policy as it is likely to provide a poor return over the next few years.
This poor return applies to most life insurance policies issued in recent years. It is better for the consumer to buy term insurance and invest the savings in a low cost investment fund. With the drop in investment values, there is potential for a good return over the next 10 to 20 years.
http://www.tankinlian.com/faq/savings.html
I bought a Living policy with NTUC when you were CEO. Lately, I read that you recommended against the Living policy. Can you clarify?
REPLY
I have just surrendered my Living policy. After paying premium for 12 years, my cash value is still below the total premiums paid.
In the earlier years, the bonus was quite attractive. Later, the bonus was cut due to the economic downturn in 2003.
There was a chance to restore the bonus earlier this year, before the financial crisis, but the management refused to do so. I have decided to terminate the policy as it is likely to provide a poor return over the next few years.
This poor return applies to most life insurance policies issued in recent years. It is better for the consumer to buy term insurance and invest the savings in a low cost investment fund. With the drop in investment values, there is potential for a good return over the next 10 to 20 years.
http://www.tankinlian.com/faq/savings.html
Lodge your complaint now, before the fund collapsed
Dear Mr. Tan,
I have just visited to H. I think you may want to highlight the following:
1. PS6 is not worth 1.7% of original value
2. PS6 now has a high chance of worthless, but no letter was sent. However, the letter dated 10 Nov 2008 from H only said credit event has occurred. It is up to you to research. Thanks to your website, which is very informative.
3. I try to see my wife’s RM and I can sense that they are systematically preventing her from meeting us. They arranged until we insisted, or otherwise they give us a written letter whey we could not see our RM. I thieir strategy is that once you lodge the complaint, the RM dropped out. At it becomes words against words, in cold environment. RM become shun from lying infront of the client.
4. I went to the branch and they originally sent a very junior RM who is only prepared to take complaint and not explaining the product.
5. My RM was on MC although I had scheduled and confirmed meeting with her. Even the branch manager did not even know she is on MC. She said she only started relieving as Br Mgr the day before.
[I had 3 different stories. The counter staff said RM was having outside appointment and will contact her. The relieve RM said she was very sick, but did not know we spoke to our RM the day before. The more senior RM said my RM has stomach flu. The branch manager did not know my RM was on MC until I told her what they told me.]
6. The RM whom met us even dare to say, even if the prospectus is given after sale, as long it is given on the same day, it is considered given BEFORE sale. It shows how green those people they use to speak to us.
IMPORTANT
I think you may want to advise others their complaint for mis-selling, if any, even before the fund collapsed.
As for my case. I am clear it was mis-selling, because the RM today said differently about the product compared to the RM at point of sale. I think it is very likely that the current RM and original RM may not understood the product.
I think we will do a SD and file it, and let nature takes its course, bec it is already a dead horse unless the Authority really takes action.
I really feel painful for those who may not know how to take care of themselves. I am saddened not because of the loss of my $50,000, but how institutions take advantage of ordinary main-street workers’ hard earn saving. This is SOFT TALK for our HARD CASH.
We are grateful that you stood for ordinary men and women, and yet being criticized by the Chua Chap [don’t even bother to remember his name].
LKH
I have just visited to H. I think you may want to highlight the following:
1. PS6 is not worth 1.7% of original value
2. PS6 now has a high chance of worthless, but no letter was sent. However, the letter dated 10 Nov 2008 from H only said credit event has occurred. It is up to you to research. Thanks to your website, which is very informative.
3. I try to see my wife’s RM and I can sense that they are systematically preventing her from meeting us. They arranged until we insisted, or otherwise they give us a written letter whey we could not see our RM. I thieir strategy is that once you lodge the complaint, the RM dropped out. At it becomes words against words, in cold environment. RM become shun from lying infront of the client.
4. I went to the branch and they originally sent a very junior RM who is only prepared to take complaint and not explaining the product.
5. My RM was on MC although I had scheduled and confirmed meeting with her. Even the branch manager did not even know she is on MC. She said she only started relieving as Br Mgr the day before.
[I had 3 different stories. The counter staff said RM was having outside appointment and will contact her. The relieve RM said she was very sick, but did not know we spoke to our RM the day before. The more senior RM said my RM has stomach flu. The branch manager did not know my RM was on MC until I told her what they told me.]
6. The RM whom met us even dare to say, even if the prospectus is given after sale, as long it is given on the same day, it is considered given BEFORE sale. It shows how green those people they use to speak to us.
IMPORTANT
I think you may want to advise others their complaint for mis-selling, if any, even before the fund collapsed.
As for my case. I am clear it was mis-selling, because the RM today said differently about the product compared to the RM at point of sale. I think it is very likely that the current RM and original RM may not understood the product.
I think we will do a SD and file it, and let nature takes its course, bec it is already a dead horse unless the Authority really takes action.
I really feel painful for those who may not know how to take care of themselves. I am saddened not because of the loss of my $50,000, but how institutions take advantage of ordinary main-street workers’ hard earn saving. This is SOFT TALK for our HARD CASH.
We are grateful that you stood for ordinary men and women, and yet being criticized by the Chua Chap [don’t even bother to remember his name].
LKH
Straits Times deleted these sentences
The Straits Times Forum editor published my reply to Chua Sheng Yang but deleted the following sentences:
I can only recall the saying, “None are so blind as those who will not see the truth”.
Mr. Chua made a personal attack on my character in the last three paragraphs of his letter. I am surprised that your newspaper found it fit to print these unsubstantiated remarks, as they are not relevant to the main issue. I shall not respond to them.
I can only recall the saying, “None are so blind as those who will not see the truth”.
Mr. Chua made a personal attack on my character in the last three paragraphs of his letter. I am surprised that your newspaper found it fit to print these unsubstantiated remarks, as they are not relevant to the main issue. I shall not respond to them.
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