Thursday, April 30, 2009
Complaints to FIDREC
If your claim for compensation has been rejected by the financial institution, you have to file a complaint with FIDREC within 6 months of the rejection letter. If you pass this deadline, FIDREC will not entertain your complaint.
It cost only $50 to get FIDREC to adjudicate your complaint. It is worth spending this money. If you need assistance to strengthen your case in preparing your complaint with FIDREC, someone (who is knowledgeable about this matter) is willing to do it for a modest fee. You can send your request to kinlian@gmail.com.
Asian culture
I am looking for a word that best describe the dress, musical instrument, cuisine, dance, sport of each Asian country. Please suggest suitable words. Example:
National costume
kimono, humbong, sarong,
National costume
kimono, humbong, sarong,
Cuisine
bulgogi, sushi, dim sum, satay, prata,
Musical instruments
er hu, zitar
Singaporeans need to overcome negative traits
Read my article in The Online Citizen and the comments of other readers.
Wednesday, April 29, 2009
SCMP:Working behind the scenes for the good of all
Beijing is sparing no effort to help the Hong Kong government reduce the number of disgruntled Lehman Brothers minibonds holders likely to take to the streets on July 1. An informed source said Bank of China (Hong Kong), one of the major banks still at loggerheads with victims over compensation, had been asked to seek a settlement by the end of June. He said Beijing was in a position to sway BOCHK's decision.
The Standard:Banks sold minibonds even as Lehman sank
Sealed findings of a report into the sale of Lehman Brothers minibonds reveal that banks continued to push the ill-fated products and recommend them to vulnerable customers up to a month before the bank collapsed.
The deleted sections of the Hong Kong Monetary Authority report, embargoed since December, show 87 of 238 complaints that institutions continued to sell Lehman minibonds even as the bank's credit quality deteriorated during August and September last year.
It also cites 102 complaints that banks sold Lehman minibonds to vulnerable customers including the elderly and illiterate, 15 cases of customer risk appetite being incorrectly assessed due to computer system error and 34 of mistakes in documentation. The HKMA had agreed to give censored parts of the report only to a Legislative Council subcommittee probing the Lehman fiasco for closed-door discussion, but legislators insisted on revealing them to the public.
It had warned legislators not to reveal details of the censored material as it could be incorrect and lawmakers were bound to discuss the issue at yesterday's hearing, subcommittee chairman Raymond Ho Chung-tai said.
``The disclosure of the omitted part may have a negative impact on people taking civil action and the Securities and Futures Commission in negotiating with sellers of Lehman products,'' HKMA chief executive Joseph Yam Chi-kwong told legislators at his third hearing on the controversy.
``Any legal challenge due to the disclosure of the full report before investigations are completed is the last thing we want to see.''
Yam will attend another hearing on May 8 and the subcommittee has summoned his deputy Choi Yiu-kwan to appear on May 26.
The Hong Kong Association of Banks has expressed concern over the disclosure in a letter to the subcommittee, Ho added.
Yam said there was a rise in complaints related to structured product sales last year, and that although the HKMA recorded 178 cases between 2003 and 2008, only one institution was punished.
``We are not trying to harbor banks. We take the cases seriously and will not let [banks] go if misselling is confirmed,'' he said.
The deleted sections of the Hong Kong Monetary Authority report, embargoed since December, show 87 of 238 complaints that institutions continued to sell Lehman minibonds even as the bank's credit quality deteriorated during August and September last year.
It also cites 102 complaints that banks sold Lehman minibonds to vulnerable customers including the elderly and illiterate, 15 cases of customer risk appetite being incorrectly assessed due to computer system error and 34 of mistakes in documentation. The HKMA had agreed to give censored parts of the report only to a Legislative Council subcommittee probing the Lehman fiasco for closed-door discussion, but legislators insisted on revealing them to the public.
It had warned legislators not to reveal details of the censored material as it could be incorrect and lawmakers were bound to discuss the issue at yesterday's hearing, subcommittee chairman Raymond Ho Chung-tai said.
``The disclosure of the omitted part may have a negative impact on people taking civil action and the Securities and Futures Commission in negotiating with sellers of Lehman products,'' HKMA chief executive Joseph Yam Chi-kwong told legislators at his third hearing on the controversy.
``Any legal challenge due to the disclosure of the full report before investigations are completed is the last thing we want to see.''
Yam will attend another hearing on May 8 and the subcommittee has summoned his deputy Choi Yiu-kwan to appear on May 26.
The Hong Kong Association of Banks has expressed concern over the disclosure in a letter to the subcommittee, Ho added.
Yam said there was a rise in complaints related to structured product sales last year, and that although the HKMA recorded 178 cases between 2003 and 2008, only one institution was punished.
``We are not trying to harbor banks. We take the cases seriously and will not let [banks] go if misselling is confirmed,'' he said.
Tuesday, April 28, 2009
Survey: Financial advise
Financial advisers are required to make a financial needs analysis of their client and to have a suitable basis for giving their advice on implementing a financial plan?
How is this advise given?
Many clients have approached me for advice, because they are confused with what the adviser told them. This is most unsatisfactory. The financial adviser earned $1,000 or more in commission and did not give a satisfactory explanation.
I suggest that the advise should be given in simple language in a format that is understandable by the client.
I also suggest that a set of the documents supporting the advise should be given to the client. The client can give the advise to another person for a second opinion. This will ensure that the quality of the advice given by the first adviser is satisfactory and conforms with some best good practice standard.
At present, the financial adviser is required to lodge their advice to the advisory firm and a supervisor is required to audit the advice. As the supervisor works for the same firm, this does not give sufficient protection to the consumer on the quality of advice and the suitability of the products.
What are your views on this matter? Particpate in this survey.
A considerate person
I visited Nanyang Junior College to give a talk to the students. After arriving at the school, I found several empty Visitors parking lots next to the main entrance. The remaining lots, presumably used by the teachers, were all occupied.
It is so easy to find these parking lots. This is a wonderful welcome to any visitor to the school.
The principal was considerate in giving priority to the visitors. He also made sure that there were sufficient lots reserved for the visitors.
I have visited many other places where all the parking lots were occupied by the staff. Some of the empty lots were "reserved for the staff". These places do not consider the visitors or customers to be important, and were accorded low priority.
I hope that more people in Singapore can be considerate, like the principal of Nanyang Junior College.
Tan Kin Lian
Monday, April 27, 2009
HK Council enters minibond fray
The Consumer Council for the first time will use its Consumer Legal Fund to help a Lehman Brothers minibond investor sue a bank to recover losses amounting to HK$500,000. Johannes Chan Man-mun, chair of the action fund, yesterday said the case has the potential to be used as a test case to clarify important legal principles and establish precedents for better consumer protection.
He said it was chosen as it involved four major factual and legal issues found in the buying of Lehman Brothers- related products.
"It involves misrepresentation, the exemption clause in the bank, inadequate disclosure of material facts, and the fiduciary relationship between the bank and its consumers."
He declined to disclose any details except that the case does not involve elderly people or the underprivileged.
Chan said they have to be very careful in bringing the case to court as public money is involved, but he is optimistic about the outcome.
He said the litigation might take 1 to two years before being heard at the High Court, and perhaps two years if it goes to the Court of Final Appeal.
Asked if the case will end up like 11 of the 82 applications for legal assistance that were withdrawn after the bank decided to settle, Chan said settlement would be a good thing for the consumer to get at least part of the money back.
The 11 applications were withdrawn after settlement that involved about HK$4.8 million.
He said litigation can begin as early as one or two months from now, as the investor had signed and returned an agreement with the Consumer Legal Action Fund yesterday.
The council up to last Friday received 11,229 complaints related to Lehman Brothers, with 624 out of 943 cases processed reaching settlement with the banks involving HK$217.8 million.
According to the council, the remaining 319 cases are unresolved as the banks have declined to settle.
The council was criticized for taking so long to process the applications after the collapse of the US firm in September last year.
http://www.thestandard.com.hk/
Hong Kong Legislative Hearing - Blacked Out Portion Release
Lehman probe 'uncovers five suspect areas'
Minibonds 'mis-selling' revealed
Parts of a report into the Lehman Brothers minibonds saga withheld from the public revealed five categories of suspected mis-selling, a source said yesterday.
These mainly involve the selling of such products to unsuitable investors, the source, who is close to the legislature, said.
The observations were included in a report by the Hong Kong Monetary Authority sent to the financial secretary in January, but were blacked out from the reports disclosed to the public.
Eight pages of the report, which had been blacked out, featured summary observations of more than 200 cases the authority investigated, the source said. Observations on those cases seemed to agree with claims by victims that many had been sold minibonds, but the risks were not fully explained. The report identified the practice of selling Lehman Brothers minibonds to people who were over 65, illiterate or had only primary school education as the most common type of suspected mis-selling.
Hong Kong investors lost billions of dollars on minibonds guaranteed by Lehman when the US investment bank went bankrupt in September. Despite their name, Lehman minibonds are not corporate bonds but complex, high-risk derivatives.
Another category of suspected mis-selling involved the marketing of minibonds to investors just as their fixed time deposits matured, which may have misled them into thinking minibonds were equally low-risk.
The report also identified cases of minibonds being sold in August and September as the extent of the subprime mortgage crisis in the US was becoming clear. The report questioned whether there had been sufficient market analysis before the minibonds were sold. It also noted documentation irregularities such as missing signatures, and indications of an inadequate risk analysis system.
Yesterday, the chairman of the legislature's subcommittee investigating the minibonds saga, Raymond Ho Chung-tai, said its members had unanimously decided there was no justification for the blackout.
He said members would now use this information in their continued questioning of the monetary authority's chief executive, Joseph Yam Chi-kwong, on Tuesday and may include the information in its own report. However, the source said there was a possibility the authority may wish to initiate judicial proceedings against such a disclosure.
An authority spokesman said it had no comment, but the chairman of the Hong Kong Association of Banks warned that disclosure could affect Hong Kong's status as an international financial services centre. "If there is customer information there - it might affect Hong Kong's status as an international financial centre, because if you disclose customer information, then those customers may no longer want to do business in Hong Kong," said Peter Wong Tung-shun, who is also HSBC's executive director. He said the association would send a letter to the authority to reflect these concerns.
Peter Chan Kwong-yue, chairman of the Allied Victims of Lehman Products, welcomed the disclosure, and said he hoped it set a precedent for the banks to disclose their own internal investigations.
"It also sends an important message because it is a slap in the face of Joseph Yam," he said, referring to the chief executive of the monetary authority
Minibonds 'mis-selling' revealed
Parts of a report into the Lehman Brothers minibonds saga withheld from the public revealed five categories of suspected mis-selling, a source said yesterday.
These mainly involve the selling of such products to unsuitable investors, the source, who is close to the legislature, said.
The observations were included in a report by the Hong Kong Monetary Authority sent to the financial secretary in January, but were blacked out from the reports disclosed to the public.
Eight pages of the report, which had been blacked out, featured summary observations of more than 200 cases the authority investigated, the source said. Observations on those cases seemed to agree with claims by victims that many had been sold minibonds, but the risks were not fully explained. The report identified the practice of selling Lehman Brothers minibonds to people who were over 65, illiterate or had only primary school education as the most common type of suspected mis-selling.
Hong Kong investors lost billions of dollars on minibonds guaranteed by Lehman when the US investment bank went bankrupt in September. Despite their name, Lehman minibonds are not corporate bonds but complex, high-risk derivatives.
Another category of suspected mis-selling involved the marketing of minibonds to investors just as their fixed time deposits matured, which may have misled them into thinking minibonds were equally low-risk.
The report also identified cases of minibonds being sold in August and September as the extent of the subprime mortgage crisis in the US was becoming clear. The report questioned whether there had been sufficient market analysis before the minibonds were sold. It also noted documentation irregularities such as missing signatures, and indications of an inadequate risk analysis system.
Yesterday, the chairman of the legislature's subcommittee investigating the minibonds saga, Raymond Ho Chung-tai, said its members had unanimously decided there was no justification for the blackout.
He said members would now use this information in their continued questioning of the monetary authority's chief executive, Joseph Yam Chi-kwong, on Tuesday and may include the information in its own report. However, the source said there was a possibility the authority may wish to initiate judicial proceedings against such a disclosure.
An authority spokesman said it had no comment, but the chairman of the Hong Kong Association of Banks warned that disclosure could affect Hong Kong's status as an international financial services centre. "If there is customer information there - it might affect Hong Kong's status as an international financial centre, because if you disclose customer information, then those customers may no longer want to do business in Hong Kong," said Peter Wong Tung-shun, who is also HSBC's executive director. He said the association would send a letter to the authority to reflect these concerns.
Peter Chan Kwong-yue, chairman of the Allied Victims of Lehman Products, welcomed the disclosure, and said he hoped it set a precedent for the banks to disclose their own internal investigations.
"It also sends an important message because it is a slap in the face of Joseph Yam," he said, referring to the chief executive of the monetary authority
Sunday, April 26, 2009
Creating or destroying value?
Business should create products that give value to customers. If the cost is $X and the value to the customer is $Y, then the business is entitled to keep the difference to cover its marketing cost, expenses and profit.
For tangible products, the customer can assess the value of $Y by looking at the price of similar products.
For financial products where the future value is uncertain, such as shares, structured products, life insurance and land banking products, it is difficult for the customer to know the real value. This allows the experts (i.e. financial advisers or businesses) to exploit the ignorance of the consumer by giving misleading advice.
The technique is to give the promise of a future value that is not likely to arise. For example, that the asset will appreciate in value. Usually, this is based on looking at the price movement in the past and selecting a period that shows the most favourable results. This is misleading.
All businesses, if it is runned well, will give a modest rate of return. If inflation is 2% per year, a return of 5% is reasonable. If the business projects a return of 15%, it is not reasonable. The business is taking excessive risk, e.g. through leveraging, or playing a speculative bubble, such as the US housing market (funded by subprime mortgages).
The promoters of these financial products take in a lot of money from investors by making unachieveable promises. They take away a large portion of their money in marketing expenses and profit. The leave the investors with assets that have depleted in value. Eventually, the investors have to realise their investments at a big loss.
Look at the history of many time share, land banking, structured products and life insurance products. While some of these products, give good value, the majority of these products destroy value for the investors.
Be careful about these types of financial products. Do not believe that the assets will appreciate in value. Often, there is someone behind that will cream off your gains and leave you with a poor yield.
Tan Kin Lian
UK: Banks face fine for poor service
I hope that MAS will implement similar measures in Singapore. Read this.
Saturday, April 25, 2009
China Daily: Secret Lehman report to be aired
HONG KONG: The Legislative Council (LegCo) subcommittee inquiring into the Lehman Brothers minibonds saga Friday decided to ignore the Hong Kong Monetary Authority (HKMA) request to keep parts of the authority's report confidential.
Subcommittee chairman Raymond Ho Chung-tai told reporters after a meeting Friday that the subcommittee disagreed with HKMA chief Joseph Yam's argument that disclosing the portion would violate public interest, the Banking Ordinance, and affect the authority's investigation.
"The chapter six (the portion in question) of the report is not targeting at any individual bank and person. It only contains some general information," he said. "We believe that disclosing the information will help the investigation. The disclosure will only create positive impact, but not negative ones. It is more appropriate to disclose."
It is expected that the concerned portion is related to the problems observed by the HKMA in 238 cases.
The problems can be classified into five categories. Half of the cases are related to the sales of the products to elderly, persons with low education, or those who invested excessively in the products. Some of the cases involved inaccurate assessment of clients' capability to bear risk, others concern lack of signatures on documents.
But the HKMA has not reached any conclusion on these cases, and the Securities and Futures Commission is still following up.
The LegCo subcommittee will have an open hearing Tuesday, which will have Yam continue his testimony.
Kam Nai-wai, a subcommittee member, said a special meeting will be held should the HKMA launch a judicial review against the disclosure.
He said disclosing the information will help investors who may have been victimized by unethical sales practices, to settle with banks.
"The public will know what the HKMA has found over the past months concerning the sales practices of banks. The public and the victims of the saga will know what constitutes bad sales practice, and know what practices are adopted by the banks," he said. "This helps us find out the truth."
Chan Kwong-yue, spokesman for the Alliance of Lehman Brothers Victims, supported disclosing the report.
"We will know more about the structural bad sales practices of banks," he said. "We will then know what kind of bad practices are recognized by the HKMA."
But Hong Kong Association of Banks chairman Peter Wong had reservations about disclosing the information.
"Clients' personal information may be contained in the report. This will affect Hong Kong's role as an international financial center because clients will not do business in Hong Kong if their information is at risk of being leaked," he said. "At this stage, we cannot see how the disclosure will help the tackling of the incident."
A spokesman of HKMA declined to comment.
Subcommittee chairman Raymond Ho Chung-tai told reporters after a meeting Friday that the subcommittee disagreed with HKMA chief Joseph Yam's argument that disclosing the portion would violate public interest, the Banking Ordinance, and affect the authority's investigation.
"The chapter six (the portion in question) of the report is not targeting at any individual bank and person. It only contains some general information," he said. "We believe that disclosing the information will help the investigation. The disclosure will only create positive impact, but not negative ones. It is more appropriate to disclose."
It is expected that the concerned portion is related to the problems observed by the HKMA in 238 cases.
The problems can be classified into five categories. Half of the cases are related to the sales of the products to elderly, persons with low education, or those who invested excessively in the products. Some of the cases involved inaccurate assessment of clients' capability to bear risk, others concern lack of signatures on documents.
But the HKMA has not reached any conclusion on these cases, and the Securities and Futures Commission is still following up.
The LegCo subcommittee will have an open hearing Tuesday, which will have Yam continue his testimony.
Kam Nai-wai, a subcommittee member, said a special meeting will be held should the HKMA launch a judicial review against the disclosure.
He said disclosing the information will help investors who may have been victimized by unethical sales practices, to settle with banks.
"The public will know what the HKMA has found over the past months concerning the sales practices of banks. The public and the victims of the saga will know what constitutes bad sales practice, and know what practices are adopted by the banks," he said. "This helps us find out the truth."
Chan Kwong-yue, spokesman for the Alliance of Lehman Brothers Victims, supported disclosing the report.
"We will know more about the structural bad sales practices of banks," he said. "We will then know what kind of bad practices are recognized by the HKMA."
But Hong Kong Association of Banks chairman Peter Wong had reservations about disclosing the information.
"Clients' personal information may be contained in the report. This will affect Hong Kong's role as an international financial center because clients will not do business in Hong Kong if their information is at risk of being leaked," he said. "At this stage, we cannot see how the disclosure will help the tackling of the incident."
A spokesman of HKMA declined to comment.
Survey: Job satisfaction of Singaporeans
Friday, April 24, 2009
Get a better return from CPF retirement account
Mr Tan,I bought the annuity in 2002 with my CPF. At that time I have faith in the Company. Today if I wish to surrender, they will pay me $X ( after about 6.5yrs ) And if I were to continue with the annuity policy, I will get about $Y p.m.I have substantial savings and have not make any withdrawal from my CPF. I have been following the development and I do not expect INCOME to pay any attractive yearly bonus.I am not sure is it better off if I had not take up this annuity and leave this sum in my CPF retirement account which many of my colleagues had done. I am prepared to keep the sum in my CPF. I am still working and no financial problem. Pls advise whether I should surrender the policy..REPLYIt is better to terminate the annuity and put the money back into the CPF special account. The surrender value that you get now represents a return of 3.9% p.a. for the last 6.5 years. It is slightly lower than the 4% given by CPF on the special account, but the loss is slight and can be ignored. It is better to look forward and get (hopefully) a better return from the CPF in the future. All the best!
Hong Kong: Legislators to lift lid on minibond probe secrets
Legislators plan to defy the Hong Kong Monetary Authority by making public portions of an investigation report into the Lehman Brothers minibonds saga that the de facto central bank wants to keep confidential.
Raymond Ho Chung-tai, chairman of the subcommittee probing the minibonds saga, said legislators will use the confidential portions of the report for discussion at public hearings.
A source says the among details the HKMA wants to keep confidential is the finding that around 50 percent of the 238 complainants are people who traditionally have a lesser appetite for risk – the elderly and those who are not well educated.
The next subcommittee hearing on Tuesday is expected to be a fiery meeting because legislators are expected to make some of the confidential findings public in the presence of HKMA chief executive Joseph Yam Chi-kwong.
http://www.thestandard.com.hk/breaking_news_detail.asp?id= 13921&icid=1&d_str=20090424
Raymond Ho Chung-tai, chairman of the subcommittee probing the minibonds saga, said legislators will use the confidential portions of the report for discussion at public hearings.
A source says the among details the HKMA wants to keep confidential is the finding that around 50 percent of the 238 complainants are people who traditionally have a lesser appetite for risk – the elderly and those who are not well educated.
The next subcommittee hearing on Tuesday is expected to be a fiery meeting because legislators are expected to make some of the confidential findings public in the presence of HKMA chief executive Joseph Yam Chi-kwong.
http://www.thestandard.com.hk/
A young person interested in politics
Hi Mr Tan,
I went tru the survery and read some of the comments in the post... just like to add:
I'm 27, just an average skilled worker, holding a diploma, getting 2k+ a monthly. Like most sg kids then, I have no interest in politics nor policies the white immortals came up with. I always thot: wats it gotta do with me? After all, I'm just another ordinary guy, interested in stuff like computers and have no interest in politics.
Fast forward 20 years and then we will realise: whats it gotta do with me? everything.
I have come to realise in recent years: Every scheme every policy every act, no matter how small affects us. It pains me to see how incompetent the current govt is. Its no joke whenever u seek help or answers, u are pushed into a chain of merry go rounds whereby each recipients declare someone else is responsible.
The media furthers this cause by dropping red herrings or changing the subjects to make govt related bodies look good.
Look at the recent Current affairs. Which agency or leader have ever declared "yes its our mistake. we will do watever we can to learn and not repeat" ?
Every single one starts by declaring "its not my fault. Everyone else is to blame" and then finds a scrapgoat, if not then its "everyone went in with their eyes open".
Whatever happened to govt is meant to serve the people, instead of the other way around now?
Its a sad state that singapore has fallen to, what has happen to inspirational leaders like the current Obama, hell, even the past LKY? Now they "fix oppositions and buy votes" if cannot? then declare "public order act" and use the army in case they lose. What is this? This is not the sg i knew when i was younger, or maybe i was so ignorant then.
The younger generations... they dont see these things. I never did then either, after all you cant blame them. What do pple care about in the teens? sports, bgrs, entertainment, games etc... Politics is 'boring stuff' for 'adults'. At least I used to think so.
If i were given a chance to get into politics now, i would snap at it, not becos of fame or fortune. I dislike fame, and I think i am already fortunate. The only reason to why I would want to get in, is only to be a voice of the oppressed and the repressed, to keep ministers in check or at the least, make them stay honest. I'm no noble man, being just a normal ordinary citizen, but I dislike injustice, and to think that I used to think such things dun usually happen in our sparkling clean Singapore.
Yet we STARE at it every single day, and still they want to whitewash every event and highlight their "achievements" and gloat about their paycheck. 6 times the POTUS paycheck? Where's 6 times the responsibility? All i see is 6 times the taichi, perhaps there is a correlation between higher pay and less responsibility after all. If not, how do people hold multiple directorships and run every inc at the same time? Somebody has got to keep them honest, and make them work for their paycheck.
I hope Singapore never experiences what Thailand is going tru... but I feel that like many people after they climb all the way to the top of the ivory tower, sometimes they need a good fall to be more down to earth. Bend a branch too much, eventually it will snap. Its a precarious balancing act those people are doing, how long before the "mortals" get sick and tired of being treated like idiots and being taken for a ride? For me, its probably too late to get my say into politics. If I knew then wat i knew now, i would have chose a much different path. The day President Ong stepped down was the day the govt 'won'. What we have left, is just a mascot doing the biddings of the mastermind.
A certain character from a action movie once told a "hero" in his fight against corruption: "you either die a hero, or live long enough to see yourself become the villian".
For me, I waitng for a new dawn in singapore government. Failing which, I'm setting my sights on New Zealand. I heard the grass there is not only greener, but a lot less hectic.
(name deleted)
I went tru the survery and read some of the comments in the post... just like to add:
I'm 27, just an average skilled worker, holding a diploma, getting 2k+ a monthly. Like most sg kids then, I have no interest in politics nor policies the white immortals came up with. I always thot: wats it gotta do with me? After all, I'm just another ordinary guy, interested in stuff like computers and have no interest in politics.
Fast forward 20 years and then we will realise: whats it gotta do with me? everything.
I have come to realise in recent years: Every scheme every policy every act, no matter how small affects us. It pains me to see how incompetent the current govt is. Its no joke whenever u seek help or answers, u are pushed into a chain of merry go rounds whereby each recipients declare someone else is responsible.
The media furthers this cause by dropping red herrings or changing the subjects to make govt related bodies look good.
Look at the recent Current affairs. Which agency or leader have ever declared "yes its our mistake. we will do watever we can to learn and not repeat" ?
Every single one starts by declaring "its not my fault. Everyone else is to blame" and then finds a scrapgoat, if not then its "everyone went in with their eyes open".
Whatever happened to govt is meant to serve the people, instead of the other way around now?
Its a sad state that singapore has fallen to, what has happen to inspirational leaders like the current Obama, hell, even the past LKY? Now they "fix oppositions and buy votes" if cannot? then declare "public order act" and use the army in case they lose. What is this? This is not the sg i knew when i was younger, or maybe i was so ignorant then.
The younger generations... they dont see these things. I never did then either, after all you cant blame them. What do pple care about in the teens? sports, bgrs, entertainment, games etc... Politics is 'boring stuff' for 'adults'. At least I used to think so.
If i were given a chance to get into politics now, i would snap at it, not becos of fame or fortune. I dislike fame, and I think i am already fortunate. The only reason to why I would want to get in, is only to be a voice of the oppressed and the repressed, to keep ministers in check or at the least, make them stay honest. I'm no noble man, being just a normal ordinary citizen, but I dislike injustice, and to think that I used to think such things dun usually happen in our sparkling clean Singapore.
Yet we STARE at it every single day, and still they want to whitewash every event and highlight their "achievements" and gloat about their paycheck. 6 times the POTUS paycheck? Where's 6 times the responsibility? All i see is 6 times the taichi, perhaps there is a correlation between higher pay and less responsibility after all. If not, how do people hold multiple directorships and run every inc at the same time? Somebody has got to keep them honest, and make them work for their paycheck.
I hope Singapore never experiences what Thailand is going tru... but I feel that like many people after they climb all the way to the top of the ivory tower, sometimes they need a good fall to be more down to earth. Bend a branch too much, eventually it will snap. Its a precarious balancing act those people are doing, how long before the "mortals" get sick and tired of being treated like idiots and being taken for a ride? For me, its probably too late to get my say into politics. If I knew then wat i knew now, i would have chose a much different path. The day President Ong stepped down was the day the govt 'won'. What we have left, is just a mascot doing the biddings of the mastermind.
A certain character from a action movie once told a "hero" in his fight against corruption: "you either die a hero, or live long enough to see yourself become the villian".
For me, I waitng for a new dawn in singapore government. Failing which, I'm setting my sights on New Zealand. I heard the grass there is not only greener, but a lot less hectic.
(name deleted)
Thursday, April 23, 2009
Wednesday, April 22, 2009
Jobs in service industry
Many department stores in Jakarta employ many sales assistants. They have the time to provide customer service. The sales assistants earn a minimum wage (about USD 100 per month), but this is sufficient to meet the cost of living. It creates many jobs for the young people.
I hope that our service sectors in Singapore take the same approach and employ more people to improve customer service. During the current economic downturn, many people (young and older) will be happy to have a job, even if the wages are low. Being employed is better than being unemployoed, and remaining idle, at home.
They will learn the experience of customer service, which will be useful for the future quality of life in Singapore.
As many businesses are watching their cash flow, perhaps some government funding can be given for these customer service jobs?
Tan Kin Lian
SCMP:Eightfold rise in funding to investigate bank gripe
The Monetary Authority will spend HK$138 million this year to handle complaints against banking services - an eightfold increase on last year, before US investment bank Lehman Brothers went bankrupt.
It spent HK$17 million in this area last year. In the new plan, most of the money, some HK$84 million, will be used to pay for extra staff to handle complaints.
The funding was detailed in the authority's annual report published yesterday - which also revealed that Joseph Yam Chi-kwong, its chief executive, enjoyed a pay rise of 15.44 per cent last year, pocketing HK$11.93 million.
Mr Yam, one of the best paid central bankers in the world, saw his fixed pay rise 8.38 per cent to HK$7.783 million, while his performance-linked variable pay increased 15.87 per cent to HK$3.176 million. He also received other benefits.
The authority's three deputy chief executives averaged HK$7.04 million, and the 13 executive directors averaged HK$4.20 million.
Democratic Party lawmaker Kam Nai-wai said he was unhappy at Mr Yam's salary increase. He said that as the authority unveiled in January a full-year investment loss of HK$74.9 billion for the Exchange Fund, he could not find a reason why Mr Yam could enjoy such a large pay rise.
Mr Kam said the eightfold increase in spending to handle complaints against banking services was a reflection of underspending and understaffing in the authority's investigation efforts before the Lehman Brothers debacle.
Civic Party lawmaker Ronny Tong Ka-wah said Mr Yam's pay rise was incomprehensible. He questioned how HK$138 million would be spent as he had not seen any obvious results from the investigative work already done by the authority into matters relating to Lehmans Brothers.
Hong Kong investors lost billions on minibonds guaranteed by Lehman Brothers. They have urged Mr Yam to give up his bonuses and cut his pay for the Exchange Fund losses and what they said was poor regulation of banks that had dishonestly selling some financial products.
The authority said on March 27 it would freeze the salaries of Mr Yam and about 600 employees this year. Last year it reduced their variable pay - similar to a bonus - by 30 per cent. This cut the bonus to the equivalent of two months' pay on average, down from 2.9 months in 2007.
The city's de facto central bank budgeted staff costs of HK$656 million for the year, a rise of 3.96 per cent, making up 78.5 per cent of the total administrative expenditure budget of HK$836 million. In the report, Mr Yam described the global meltdown as "some of the most dramatic events in living memory". He said local banks were not insulated from the crisis, with profitability deteriorating and cost-to-income ratios rising.
Monday, April 20, 2009
Excellent facilities at Changi Airport
I am now using the Laptap Access point outside of my departure gate at Changi Airport. The facilities are excellent. It is more convenient to me than the DBS Asia Treasures Lounge which I used previously, and is located in a different terminal. If I do not have a laptop, I can use the free internet terminals which is also available here.
DBS Asia Treasures Lounge
I have been a customer of DBS for more than 30 years. A few years ago, they offered me the membership of the Asia Treasures lounge in Changi Airport. I did not use the facilities initially.
Last two years, I used the facilities regularly for my trips to Jakarta. Recently, DBS decided not to renew my membership on its expiry. Their explanation was that my asset under management fell below $1 million.
I do not recall have met this $1 million mark when the membership was first offered to me. DBS must have raised the requirement for people who used the facilities regularly. So, current profit is more important than past relationship. This is the new value system in Singapore.
I have learned to accept the new world, but I do wish for the old world where long term relationship is treasured.
Tan Kin Lian
Sunday, April 19, 2009
Contingency fee system
I discussed with a law professor in a local university. Is it good for Singapore to adopt a contingency fee system for legal practice?
We came to the conclusion that it is useful under certain circumstances and for the following reasons:
(a) Where the litigant cannot afford the legal fees to take up a case against a large organisation
(b) Where the lawyer is in a better position to judge the merit of the case and should take the risk of the outcome.
If more cases are tried in court, it will lead to a better understanding of the law. This will be good for the society.
Tan Kin Lian
The Standard:Minibond anger directed at Donald Tsang
About 850 angry Lehman Brothers minibond investors yesterday called for Chief Executive Donald Tsang Yam-kuen to step down for failing to help them.
The Alliance of Lehman Brothers Victims claimed 3,000 protesters, wearing red headbands bearing the Chinese character for angry, joined a march from Causeway Bay to the central government offices.
Among the group were some Singapore and Taiwan investors who also urged the Hong Kong government to handle the issue faster. The protesters vented their anger by hitting a drum, pasted with Tsang's photo, outside the government headquarters.
A Singapore investor said her government has resolved 70 percent of about 8,000 cases through judgment. "It seems the Singapore government is more reactive. It takes too long here [Hong Kong] and the compensation is too little," she said.
Alliance chairman Peter Chan Kwong-yue criticized the authorities for not carrying out their responsibilities and hit out at the Securities and Futures Commission for allowing banks to sell the minibonds, and police and the Department of Justice for not following up the complaints.
Chan was angry over Tsang's silence. "He has not showed concern to the investors since October. It is so disappointing," he said.
Democratic Party lawmaker Kam Nai-wai said he hopes Financial Secretary John Tsang Chun-wah will explain the incident to the Legislative Council.
A government spokesman said it has requested the Hong Kong Monetary Authority and the Securities and Futures Commission to seriously handle the complaints.
"We note that two SFC-licensed minibond distributors have agreed with the SFC to make a voluntary offer to purchase from their eligible clients all outstanding Lehman Brothers minibonds at a price equal to the principal amount invested.
So far, there are about 6,000 cases in which voluntary settlements have been reached or are soon to be reached with the banks concerned."
The Alliance of Lehman Brothers Victims claimed 3,000 protesters, wearing red headbands bearing the Chinese character for angry, joined a march from Causeway Bay to the central government offices.
Among the group were some Singapore and Taiwan investors who also urged the Hong Kong government to handle the issue faster. The protesters vented their anger by hitting a drum, pasted with Tsang's photo, outside the government headquarters.
A Singapore investor said her government has resolved 70 percent of about 8,000 cases through judgment. "It seems the Singapore government is more reactive. It takes too long here [Hong Kong] and the compensation is too little," she said.
Alliance chairman Peter Chan Kwong-yue criticized the authorities for not carrying out their responsibilities and hit out at the Securities and Futures Commission for allowing banks to sell the minibonds, and police and the Department of Justice for not following up the complaints.
Chan was angry over Tsang's silence. "He has not showed concern to the investors since October. It is so disappointing," he said.
Democratic Party lawmaker Kam Nai-wai said he hopes Financial Secretary John Tsang Chun-wah will explain the incident to the Legislative Council.
A government spokesman said it has requested the Hong Kong Monetary Authority and the Securities and Futures Commission to seriously handle the complaints.
"We note that two SFC-licensed minibond distributors have agreed with the SFC to make a voluntary offer to purchase from their eligible clients all outstanding Lehman Brothers minibonds at a price equal to the principal amount invested.
So far, there are about 6,000 cases in which voluntary settlements have been reached or are soon to be reached with the banks concerned."
Where are the jobs?
The unemployment rate in USA is now at 8.5% and is expected to increase to 10%. The unemployment rate in many countries Europe has been over 10% for many years.
The unemployment rate in Singapore may appear low by international standards, but it is seriously under-reported. Due to the lack of employment benefit, many people do not bother to report that they are looking for work.
Minister of Manpower Gan Kim Yong advised graduates to take any job, rather than sit at home. But, where are the jobs? There are insufficient jobs for the large number of people looking for work. Those with jobs work long hours, to justify their cost to the employer. This is the outcome of the free market system.
If we continue to believe in the free market and in globalisation, it will take a long time for a solution to be found. The free market system has finally broken down, and yet economists and policymakers do not want to face the reality that it is a failed system.
We need a better system (other than the free market) to distribute the work among the people in the world in a fair manner. This will give a better quality of life to all people.
Tan Kin Lian
Bonus cut on life insurance policies
Dear Mr. Tan,
I received a letter fror my insurance company that they are cutting my bonus. I know that the global economic situation is bad, but I feel that there is no need for a big cut. After all, the insurance company made big profit last year, and they did not increase their bonus rate by much. Is it fair?
REPLY
I agree with your views. There is lack of transparency in the manner in which the bonus has been cut. Some policies have a bigger cut in bonus compared to other policies. It seems that the old plans have bigger cut compared to the newer plans, as the insurance company hopes to sell their new plans.
It is important that insurance companies should treat all policyholders fairly and that the bonus must be distributed fairly based on the actual experience of the insurance fund. It is not fair for an insurance company to withhold profits in good years and make a big cut in bad years.
If you wish to provide feedback on the bonus cut on your policy, you can give details here. It will be kept in confidence.
Saturday, April 18, 2009
Survey: Getting our young into Politics
Mr. Lee Kuan Yew said that young people are not interested to go into politics. He quoted the example of his grandson, who is now on a scholarship.
I like to carry out this survey to get the views of a wider group of people. Please participate.
Here are the survey results.
Financial Advisory Approach
Contributed by Zhummmeng
A financial advisory approach is entirely different from product pushing. The advisory approach aims to put the interest of the clients first and to address the cleints' interest on a reasonable basis.Products are solutions.It is assumed that the advisers have no inkling of the product suitable for the clients until the clients' needs are uncovered.
The product pushing approach is aimed at selling the products with the highest commission that benefit the salesmen and NOT the clients.It is peddling the products upfront. It is fast and quick way of making money for the insurance salesmen. All MDRT, COT or TOT aspirants use this method and to make a lot of commission to qualify for these dubious awards because it is commission based.MAS must address this if it wants to see a fair dealing outcome for consumers.
A financial advisory approach is entirely different from product pushing. The advisory approach aims to put the interest of the clients first and to address the cleints' interest on a reasonable basis.Products are solutions.It is assumed that the advisers have no inkling of the product suitable for the clients until the clients' needs are uncovered.
The product pushing approach is aimed at selling the products with the highest commission that benefit the salesmen and NOT the clients.It is peddling the products upfront. It is fast and quick way of making money for the insurance salesmen. All MDRT, COT or TOT aspirants use this method and to make a lot of commission to qualify for these dubious awards because it is commission based.MAS must address this if it wants to see a fair dealing outcome for consumers.
In an advisory process it begins with gathering of data , needs, goals fears and concerns of the clients, financial circumstances, preferences etc and then followed by analysis and then recommendation and implementation of the recommendations or executions and monitoring.
The advisory is a 6 step approach:
1.Establishment of relationship between client and adviser, defination of goals and objectives
2.data gathering.
3.Analysis
4.Recommendations/a plan constructed
5.Implementation
6. Monitoring and review
1.Establishment of relationship between client and adviser, defination of goals and objectives
2.data gathering.
3.Analysis
4.Recommendations/a plan constructed
5.Implementation
6. Monitoring and review
The whole process is documented in the fact find form, from analysis to recommendation and reasons of recommendation..This plan is portable and can be reviewed by another adviser to continue the advisory work if the client wants a change of adviser.
So, you see, the whole process isn't what the insurance agents are doing. Do you think your needs can be settled within an hour? Sure, your "needs" will be short changed if you are product sold. Not only that, you are likely to be mis-sold ,misrepresented all because of the greed or incompetence of the insurance agents. It is very clear insurance agents pushing products have no desire to help the clients meet their goals.
To solve this problem.
1. Make the advisory need based approach compulsory for most if not all cases. Who needs this most? The ordinary man in the street needs this help. They are clueless, ignorant and not financially savvy. Usually these people make up the major clientele of any adviser and not the rich or savvy who don't need advice.
2. Make all advisers or insurance agents accountable and liable for their recommendations. This is to prevent product pushing and malpractice.
3. Remove the commission and replace with fee . (commission is the major cause of mis-selling and conflict of interest)
4. Set a review body to help clients review their existing policies for mis-selling or conflict of interest and inappropriate recommendations.
5. A product advice or no advice WARNING to savvy clients. A warning must be verbally told to client and stated in the fact find form that choosing the options of 'product advice' and 'no advice' will put them at a disadvantage and by their action their rights to redress will be forfeited and waived if the product bought is wrong.
1. Make the advisory need based approach compulsory for most if not all cases. Who needs this most? The ordinary man in the street needs this help. They are clueless, ignorant and not financially savvy. Usually these people make up the major clientele of any adviser and not the rich or savvy who don't need advice.
2. Make all advisers or insurance agents accountable and liable for their recommendations. This is to prevent product pushing and malpractice.
3. Remove the commission and replace with fee . (commission is the major cause of mis-selling and conflict of interest)
4. Set a review body to help clients review their existing policies for mis-selling or conflict of interest and inappropriate recommendations.
5. A product advice or no advice WARNING to savvy clients. A warning must be verbally told to client and stated in the fact find form that choosing the options of 'product advice' and 'no advice' will put them at a disadvantage and by their action their rights to redress will be forfeited and waived if the product bought is wrong.
This is necessary to prevent abuse by insurance agents who try to avoid fact finding or to decieve the cleints that fact find is inconveneint to them and messy. This is also to stop the insurance agents from short changing the clients.Currently it seems that insurance agents' clients are financially savvy.The fact it is the opposite. All clients must be assumed to be clueless in order for a proper process to take place.
Zhummmeng
Thursday, April 16, 2009
Survey - Sale and marketing of unlisted investment products
The protem committee of FISCA (Financial Services Consumer Association) intends to submit the following paper to MAS giving our views on its proposals regarding the sale and marketing of unlisted investment products (including life insurance and structured products).
Give your views to FISCA's proposals in this survey.
Wednesday, April 15, 2009
Opinion from Queen's Counsel
In December, I asked a lawyer to approach a Queen's Counsel for an opinion about the legality of the prospectus used for the credit linked notes.
The Queen's Counsel indicated an extremely high fee for the legal opinion. As this fee was many times more than the initial budget, I decided not to pursue this matter. I informed the group leaders about this decision.
Investors who wish to pursue the class action can contact the group leaders indicated in this blog. Please get an update from the group leader directly.
I have arranged with a lawyer to provide assistance to investors who wish to pursue the matter through FIDREC or the subordinate court on an individual basis. This is an alternative to the class action. Those who wish to make consider this option can send an e-mail to me at kinlian@gmail.com.
Tan Kin Lian
Thoughts For The Week: Tyranny
Contributed by Ho Chew Seng
"The modern conservative is engaged in one of man's oldest exercises in moral philosophy: that is the search for a superior moral justification for selfishness." : John Kenneth Galbraith
"Of all forms of tyranny the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of plutocracy" : John Pierpont Morgan
"The modern conservative is engaged in one of man's oldest exercises in moral philosophy: that is the search for a superior moral justification for selfishness." : John Kenneth Galbraith
"Of all forms of tyranny the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of plutocracy" : John Pierpont Morgan
Erosion of ethics and honesty
Previously, we can trust business to be ethical and honest. The standard of ethics has deteriorated much in recent years. Many oraganisations think about profits and do not hesitate to cheat their customers.
I received a cheque in payment of providing a service. I did not bank in the check and it expired after six months.
I sent an email to ask for a replacement cheque. I did not get any reply. I sent a hard copy letter by post. I did not get any reply. I did not get the replacement cheque. Another six months had passed.
I suspect that the accounts staff of this large and respected organisation probably felt that it was all right for the company to write back the forfeited amount as its profits. This is a very sad state of affairs.
Tan Kin Lian
The Standard:Yam yields on minibonds
The Hong Kong Monetary Authority has given way to legislators' demands to show them a censored part of a report investigating Lehman Brothers minibonds.
HKMA chief executive Joseph Yam Chi-kwong, who had previously refused to disclose the sealed findings citing the public interest, agreed on Monday night to present the findings to legislators for discussion, according to Raymond Ho Chung-tai.
Ho, who represents the engineering sector, expects lawmakers to discuss the matter on Friday at a closed-door meeting, with the next hearing taking place on Tuesday.
Yam, who testified at a Legco hearing for the first time yesterday, said the HKMA bears a strong responsibility to handle problems caused by the minibonds saga even though it issued warnings before the Lehman collapse.
In response to legislators such as Emily Lau Wai-hing, who accused Yam of ``falling asleep'' when handling complaints about the sale of minibonds, he said the HKMA is doing its best. But the search for justice would take time.
``Our heart goes to investors and we really want to help them,'' Yam said at the three-hour hearing.
``We will not be softhearted when we handle the complaints as they will affect our banking system. We are in a hurry to complete them.''
Almost 300 investors protested outside Legco yesterday, accusing Yam of turning a blind eye to questionable selling practices behind the derivatives.
The territory's de facto central bank aims to complete handling 70 percent of the more than 20,000 complaints it has received by March next year.
More than 6,000 cases have been settled or nearly settled, according to Yam.
From the end of 2007 to early 2008, eight banks adjusted ratings of credit linked products _ including minibonds _ to ``high-risk'' among 16 banks being investigated, Yam said.
In answer to a question by Ronny Tong Ka-wah, Yam suggested the term minibond may be misleading.
He had read minibond prospectuses, which referred to the derivatives as bonds.
But Yam reiterated that the Securities and Futures Commission is responsible for approving securities products and the HKMA has no right to give opinions when they are approved.
HKMA chief executive Joseph Yam Chi-kwong, who had previously refused to disclose the sealed findings citing the public interest, agreed on Monday night to present the findings to legislators for discussion, according to Raymond Ho Chung-tai.
Ho, who represents the engineering sector, expects lawmakers to discuss the matter on Friday at a closed-door meeting, with the next hearing taking place on Tuesday.
Yam, who testified at a Legco hearing for the first time yesterday, said the HKMA bears a strong responsibility to handle problems caused by the minibonds saga even though it issued warnings before the Lehman collapse.
In response to legislators such as Emily Lau Wai-hing, who accused Yam of ``falling asleep'' when handling complaints about the sale of minibonds, he said the HKMA is doing its best. But the search for justice would take time.
``Our heart goes to investors and we really want to help them,'' Yam said at the three-hour hearing.
``We will not be softhearted when we handle the complaints as they will affect our banking system. We are in a hurry to complete them.''
Almost 300 investors protested outside Legco yesterday, accusing Yam of turning a blind eye to questionable selling practices behind the derivatives.
The territory's de facto central bank aims to complete handling 70 percent of the more than 20,000 complaints it has received by March next year.
More than 6,000 cases have been settled or nearly settled, according to Yam.
From the end of 2007 to early 2008, eight banks adjusted ratings of credit linked products _ including minibonds _ to ``high-risk'' among 16 banks being investigated, Yam said.
In answer to a question by Ronny Tong Ka-wah, Yam suggested the term minibond may be misleading.
He had read minibond prospectuses, which referred to the derivatives as bonds.
But Yam reiterated that the Securities and Futures Commission is responsible for approving securities products and the HKMA has no right to give opinions when they are approved.
SCMP:HKMA chief to disclose full report at closed-door Legco meeting
The Hong Kong Monetary Authority chief has finally agreed to disclose its full report on the sale of Lehman Brothers-related products, but only to the Legislative Council subcommittee investigating the saga.
"We have been asking Joseph Yam [Chi-kwong] to give us the omitted parts of his review report, which was submitted to the financial secretary at the end of last year," Raymond Ho Chung-tai, chairman of the subcommittee set up to study the minibonds debacle, said yesterday. "He wrote back to us yesterday afternoon saying he would be willing to give us the whole report under closed-door conditions and explaining why he is seeking public interest immunity."
Both the HKMA and the Securities and Futures Commission prepared reports on the lessons learned and issues they identified during an investigation into complaints about the Lehman Brothers-related products at the request of Finance Secretary John Tsang Chun-wah. But some parts of the reports were not disclosed because the banking and securities regulators said their investigations would be affected by doing so.
The closed-door meeting on the report will be held as early as Friday, Mr Ho said. Asked if the subcommittee would make the non-disclosed part public, he said lawmakers would decide on this.
"We have been asking Joseph Yam [Chi-kwong] to give us the omitted parts of his review report, which was submitted to the financial secretary at the end of last year," Raymond Ho Chung-tai, chairman of the subcommittee set up to study the minibonds debacle, said yesterday. "He wrote back to us yesterday afternoon saying he would be willing to give us the whole report under closed-door conditions and explaining why he is seeking public interest immunity."
Both the HKMA and the Securities and Futures Commission prepared reports on the lessons learned and issues they identified during an investigation into complaints about the Lehman Brothers-related products at the request of Finance Secretary John Tsang Chun-wah. But some parts of the reports were not disclosed because the banking and securities regulators said their investigations would be affected by doing so.
The closed-door meeting on the report will be held as early as Friday, Mr Ho said. Asked if the subcommittee would make the non-disclosed part public, he said lawmakers would decide on this.
REUTERS:HKMA says it gave risk warnings before minibond failure
HONG KONG, April 14 (Reuters) - Hong Kong's central bank chief on Tuesday said he had warned investors about the risks of buying derivatives long before Lehman Brothers collapsed, but revealed that Lehman minibonds had been ranked "high risk" by only half of the 16 banks investigated.
More than 40,000 Hong Kongers ploughed nearly US$2.5 billion into failed structured products, known as minibonds, offered by U.S. investment bank Lehman Brothers, which collapsed last September.
Hong Kong Monetary Authority Chief Executive Joseph Yam, answering questions on the sale of Lehman minibonds in the Legislative Council, said he had issued several warnings in the media from the middle of 2006 about the risks of investing in derivatives products. By June 2008, banks in the city were no longer offering the Lehman products, he said.
"In terms of forewarning of risk, I think we have done enough," Yam said. Investors, however, claim they were misled over the sale of the products, which were called "minibonds" but were actually complex derviatives products, and have demanded full compensation.
Yam admitted that in late 2007 three banks distributing the bonds had ranked them as "low-risk" investment products and another five banks were selling them as "medium risk".
That was partly because the products were less risky before the credit crisis spread in 2008, Yam said.
"The risk for CDOs (collateralised debt obligations) suddenly shot up," Yam said. "We warned the market ... It did not mean banks were wrong, it was just that banks did not respond in a timely manner."
Only two distributors, Sun Hung Kai Financial and KGI Asia Ltd, have agreed to compensate Lehman minibond investors so far.
A spokeswoman for Bank of China (Hong Kong) declined comment on media reports that the bank, the largest distributor of the Lehman products, was in advanced talks with the Securities and Futures Commission about compensating investors.
The HKMA and the Securities and Futures Commission have separately made recommendations on how to better protect investors, including forcing banks to separate their deposit-taking and retail investment businesses from the end of September at the latest.
Investors in Singapore and Indonesia have also lost money on the products.
More than 40,000 Hong Kongers ploughed nearly US$2.5 billion into failed structured products, known as minibonds, offered by U.S. investment bank Lehman Brothers, which collapsed last September.
Hong Kong Monetary Authority Chief Executive Joseph Yam, answering questions on the sale of Lehman minibonds in the Legislative Council, said he had issued several warnings in the media from the middle of 2006 about the risks of investing in derivatives products. By June 2008, banks in the city were no longer offering the Lehman products, he said.
"In terms of forewarning of risk, I think we have done enough," Yam said. Investors, however, claim they were misled over the sale of the products, which were called "minibonds" but were actually complex derviatives products, and have demanded full compensation.
Yam admitted that in late 2007 three banks distributing the bonds had ranked them as "low-risk" investment products and another five banks were selling them as "medium risk".
That was partly because the products were less risky before the credit crisis spread in 2008, Yam said.
"The risk for CDOs (collateralised debt obligations) suddenly shot up," Yam said. "We warned the market ... It did not mean banks were wrong, it was just that banks did not respond in a timely manner."
Only two distributors, Sun Hung Kai Financial and KGI Asia Ltd, have agreed to compensate Lehman minibond investors so far.
A spokeswoman for Bank of China (Hong Kong) declined comment on media reports that the bank, the largest distributor of the Lehman products, was in advanced talks with the Securities and Futures Commission about compensating investors.
The HKMA and the Securities and Futures Commission have separately made recommendations on how to better protect investors, including forcing banks to separate their deposit-taking and retail investment businesses from the end of September at the latest.
Investors in Singapore and Indonesia have also lost money on the products.
SCMP:Monetary chief defends actions in minibond saga I'm not shirking role: Joseph Yam
Monetary Authority chief Joseph Yam Chi-kwong stressed yesterday that the Securities and Futures Commission should be responsible for monitoring the disclosure of information on financial products.
"I'm not shirking responsibility," Mr Yam said. "The division of labour is very clear the HKMA does not have the power" to review the commission's work, he told a Legislative Council public hearing on the minibond saga.
While he conceded that the authority was responsible for regulating banks on the sale of structured products, he said: "My colleagues and I have done what we can do and we have fulfilled our responsibilities to get the job done to the best especially the job of regulating banks on the selling of structural products."
He was the second official to testify before the Legco subcommittee on Lehman Brothers-related financial products, after Chan Ka-keung, secretary for financial services and the treasury.
More then 48,000 investors in Hong Kong bought HK$20 billion worth of Lehman minibonds and structured products. Minibonds are not corporate bonds but consist of high-risk credit-linked derivatives that are marketed as a proxy investment in well-known companies.
Mr Yam was asked if the regulator had failed to protect investors by allowing high-risk financial products such as minibonds to be sold to ordinary investors.
He said the disclosure of information about financial products was beyond the responsibilities of the authority; the SFC, however, should be accountable. He also said that banks and brokers, rather than the regulators, should be responsible for assessing the risk of financial products.
Still, Mr Yam said the authority requested that banks raise the risk level of derivatives such as minibonds after it found in 2007 that only half of the 16 banks it investigated ranked those products as high-risk.
Mr Yam said he had repeatedly warned the public about the risk of buying derivatives products from the middle of 2006. Local banks were no longer offering Lehman minibonds by June last year.
He revealed that from April 2003 - when the Securities Ordinance came into effect - until Lehman Brothers' collapse in September last year, the authority had found 178 suspected cases of the mis-selling of financial products by banks. Of the 33 cases that have been closed, in nine cases banks were found guilty and were penalised.
Democratic Party lawmaker Emily Lau Wai-hing said the process was too slow and the authority had only finished investigating about 6,000 of more than 20,000 complaints related to Lehman products.
Mr Yam said the watchdog would recruit more staff, but some people found investigative work "disgusting". He expected to have dealt with 70 per cent of complaints by next March. About 300 investors who bought Lehman-related products protested outside Legco before the meeting yesterday. They said the regulators should be blamed for letting banks sell high-risk products.
"I'm not shirking responsibility," Mr Yam said. "The division of labour is very clear the HKMA does not have the power" to review the commission's work, he told a Legislative Council public hearing on the minibond saga.
While he conceded that the authority was responsible for regulating banks on the sale of structured products, he said: "My colleagues and I have done what we can do and we have fulfilled our responsibilities to get the job done to the best especially the job of regulating banks on the selling of structural products."
He was the second official to testify before the Legco subcommittee on Lehman Brothers-related financial products, after Chan Ka-keung, secretary for financial services and the treasury.
More then 48,000 investors in Hong Kong bought HK$20 billion worth of Lehman minibonds and structured products. Minibonds are not corporate bonds but consist of high-risk credit-linked derivatives that are marketed as a proxy investment in well-known companies.
Mr Yam was asked if the regulator had failed to protect investors by allowing high-risk financial products such as minibonds to be sold to ordinary investors.
He said the disclosure of information about financial products was beyond the responsibilities of the authority; the SFC, however, should be accountable. He also said that banks and brokers, rather than the regulators, should be responsible for assessing the risk of financial products.
Still, Mr Yam said the authority requested that banks raise the risk level of derivatives such as minibonds after it found in 2007 that only half of the 16 banks it investigated ranked those products as high-risk.
Mr Yam said he had repeatedly warned the public about the risk of buying derivatives products from the middle of 2006. Local banks were no longer offering Lehman minibonds by June last year.
He revealed that from April 2003 - when the Securities Ordinance came into effect - until Lehman Brothers' collapse in September last year, the authority had found 178 suspected cases of the mis-selling of financial products by banks. Of the 33 cases that have been closed, in nine cases banks were found guilty and were penalised.
Democratic Party lawmaker Emily Lau Wai-hing said the process was too slow and the authority had only finished investigating about 6,000 of more than 20,000 complaints related to Lehman products.
Mr Yam said the watchdog would recruit more staff, but some people found investigative work "disgusting". He expected to have dealt with 70 per cent of complaints by next March. About 300 investors who bought Lehman-related products protested outside Legco before the meeting yesterday. They said the regulators should be blamed for letting banks sell high-risk products.
China Daily:HKMA in defense over minibonds
HONG KONG: Chief Executive of the Hong Kong Monetary Authority (HKMA) Joseph Yam Chi-kwong admitted the government body is duty-bound in the Lehman Brothers' minibond saga, but it did enough in warning the market and monitoring banking businesses.
Yam was the second official, after Secretary for Financial Services and the Treasury Chan Ka-keung, testifying in the Legislative Council (LegCo) subcommittee's hearing which probed issues related to the investment products sold by the global financial services firm.
Lawmakers criticized the HKMA for its incapacity in monitoring the sales of structural products.
"I started to warn the market about the high risk brought by derivative instruments since mid-2006. Banks were given guidance on selling derivatives...I think the risk warning was quite enough," Yam said in his first testimony.
Lehman Brothers collapsed on September 14, 2008. Its minibonds cost nearly 50,000 Hong Kong investors billions of dollars.
He agreed that minibonds were complicated and the name misled people into thinking that the products were bond.
Yam said it was the responsibility of banks but not monitoring bodies to explain the nature and risk of products to investors, though he did frequently communicate with the financial secretary and financial services chief on market fluctuation.
The authority to examine and approve investment products lies in the Securities and Futures Commission (SFC), and the HKMA has no power to re-check its work, he added. The SFC is also responsible for determining if the disclosure of a product's information is enough.
Facing criticism from lawmakers, Yam emphasized he was not shirking the responsibility of the minibond incident.
"In monitoring banks' activities, including the sale of mortgage-linked products, I and my colleagues have done what we can within our authority," he responded.
Responding to charges that HKMA's benchmark was too lenient when eight-mortgage linked products could be rated low-risk and medium-risk, Yam shrugged off the allegation, noting that investment risks rose sharply with the onset of the global economic crisis.
Yam noted that the SFC (Securities and Futures Commission) failed to require lenders to re-evaluate risks entailed in their products once the market changed.
He added that in response to HKMA intervention some lenders did raise risk evaluations to high. Some lenders also stopped recommending high-risk products to investors. Yam told lawmakers HKMA referred 178 alleged illegal sales to the investigating committee between April 2003 and September 2008. Yam admitted the HKMA has limited power in investigation and punishment, otherwise the probe into the minibond debacle could be speeded up.
However, he rejected allegations that the investigation was too slow.
Around 6,000 of the 20,000 complaints have been handled since last year, while 6000 cases have reached settlement with banks. Yam expected to complete investigation of 70 percent of complaints by next March.
Over 200 people are deployed to deal with the complaints. Yam said it is not easy to hire new staff and training takes time.
"But I guarantee that our heart lies with the investors. We want to help them," he added the authority would not tolerate any illegal behaviors but will handle it in an impartial manner.
Yam will be summoned again to the fifth hearing next Tuesday. Yet subcommittee chairman Raymond Ho Chung-tai did not predict how many times Yam will testify.
Around 200 minibond investors protested outside the LegCo during Yam's stay yesterday morning. They accused the HKMA of not being able to keep an eye on the investment products.
Peter Chan, chairman of the Alliance of Lehman Brothers Victims, requested Yam to resign as he never apologized for the incident.
Yam was the second official, after Secretary for Financial Services and the Treasury Chan Ka-keung, testifying in the Legislative Council (LegCo) subcommittee's hearing which probed issues related to the investment products sold by the global financial services firm.
Lawmakers criticized the HKMA for its incapacity in monitoring the sales of structural products.
"I started to warn the market about the high risk brought by derivative instruments since mid-2006. Banks were given guidance on selling derivatives...I think the risk warning was quite enough," Yam said in his first testimony.
Lehman Brothers collapsed on September 14, 2008. Its minibonds cost nearly 50,000 Hong Kong investors billions of dollars.
He agreed that minibonds were complicated and the name misled people into thinking that the products were bond.
Yam said it was the responsibility of banks but not monitoring bodies to explain the nature and risk of products to investors, though he did frequently communicate with the financial secretary and financial services chief on market fluctuation.
The authority to examine and approve investment products lies in the Securities and Futures Commission (SFC), and the HKMA has no power to re-check its work, he added. The SFC is also responsible for determining if the disclosure of a product's information is enough.
Facing criticism from lawmakers, Yam emphasized he was not shirking the responsibility of the minibond incident.
"In monitoring banks' activities, including the sale of mortgage-linked products, I and my colleagues have done what we can within our authority," he responded.
Responding to charges that HKMA's benchmark was too lenient when eight-mortgage linked products could be rated low-risk and medium-risk, Yam shrugged off the allegation, noting that investment risks rose sharply with the onset of the global economic crisis.
Yam noted that the SFC (Securities and Futures Commission) failed to require lenders to re-evaluate risks entailed in their products once the market changed.
He added that in response to HKMA intervention some lenders did raise risk evaluations to high. Some lenders also stopped recommending high-risk products to investors. Yam told lawmakers HKMA referred 178 alleged illegal sales to the investigating committee between April 2003 and September 2008. Yam admitted the HKMA has limited power in investigation and punishment, otherwise the probe into the minibond debacle could be speeded up.
However, he rejected allegations that the investigation was too slow.
Around 6,000 of the 20,000 complaints have been handled since last year, while 6000 cases have reached settlement with banks. Yam expected to complete investigation of 70 percent of complaints by next March.
Over 200 people are deployed to deal with the complaints. Yam said it is not easy to hire new staff and training takes time.
"But I guarantee that our heart lies with the investors. We want to help them," he added the authority would not tolerate any illegal behaviors but will handle it in an impartial manner.
Yam will be summoned again to the fifth hearing next Tuesday. Yet subcommittee chairman Raymond Ho Chung-tai did not predict how many times Yam will testify.
Around 200 minibond investors protested outside the LegCo during Yam's stay yesterday morning. They accused the HKMA of not being able to keep an eye on the investment products.
Peter Chan, chairman of the Alliance of Lehman Brothers Victims, requested Yam to resign as he never apologized for the incident.
Tuesday, April 14, 2009
Rule of law - lesson from Thailand
The popularly elected government of Thailand, led by supporters of Thatsin Sinawatra. was deposed by street rallies, culminating in the disruption and closure of Bangkok Airport, conducted by the yellow shirted followers of the Democratic Party.
The new government was formed by the Democratic Party with some defections from the previous ruling party.
The red-shirt followers of Thatsin now follow the example of using street rallies and public disorder to cause chaos in Thailand during the recent Asean Summit.
Chaos will come to a society where the rule of law is not respected. I hope that democratic institutions, and the will of the people, are respected.
The new government was formed by the Democratic Party with some defections from the previous ruling party.
The red-shirt followers of Thatsin now follow the example of using street rallies and public disorder to cause chaos in Thailand during the recent Asean Summit.
Chaos will come to a society where the rule of law is not respected. I hope that democratic institutions, and the will of the people, are respected.
The Standard:BOC set to seal minibond dea
Bank of China (Hong Kong) (2388), the city's largest distributor of minibonds linked to failed US investment bank Lehman Brothers, is in advanced negotiations with the Securities and Futures Commission to settle the issue, market sources told The Standard.
A settlement may involve payment of about HK$600 million to the bank's disgruntled minibond buyers.
It would also serve as a benchmark for talks between the SFC and other banks to wipe off their respective minibond exposures, the sources said.
The reports come as thousands of minibond buyers prepare to rally on July 1.
BOC (Hong Kong) is estimated to have sold HK$5.6 billion out of HK$14 billion worth of Lehman minibonds bought by 48,000 local investors.
So far, only two institutions - SHKI, a unit of Sun Hung Kai & Co (0086) and KGI Asia Ltd - have settled their minibonds claims.
SHKI distributed payments of HK$85 million among 310 clients while KGI Asia paid five customers about HK$1.6 million.
The talks with SHKI are being used as a model by the SFC for current negotiation with BOC (Hong Kong), sources said.
They said the authorities are keen to settle with BOC (Hong Kong) ahead of July 1 so as not to have angry minibond investors join traditional rallies.
The organizer, Alliance of Lehman Brothers' Victims, yesterday estimated that up to 100,000 of its supporters will march on July 1.
About 400 to 500 investors will protest today against the Hong Kong Monetary Authority and the SFC outside the Legislative Council as HKMA chief executive Joseph Yam Chi-kwong attends a subcommittee hearing on the issue, the group said. Another 2,000 investors plan to march on Sunday from Causeway Bay to the SAR government headquarters.
Earlier this month, the HKMA said it had found sufficient grounds for disciplinary action against some bank staff accused of mis-selling minibonds.
Even though some investors have settled with banks, they only recovered 30 to 50 percent of their investment, the group's chairman, Peter Chan Kwong-yue, said.
Democratic Party member Andrew Fung Wai-kwong said he will file a judicial review for 11 cases before the end of the month against a Small Claims Tribunal decision on March 23 that resulted in all 135 cases being transferred to the District Court.
As of April 8, the HKMA had received 20,724 complaints, and 20,509 had cleared initial assessment.
Only 418 complaints relating to 16 banks were referred to the SFC.
As of last Wednesday, a total of 427 cases had been transferred to the SFC by the monetary authority.
Meanwhile, Liu Sui-fong, 84, is among 77 minibond investors seeking help from the Federation of Trade Unions. Liu said she had been ``misled'' by BOC (Hong Kong) staff to invest all her HK$520,000 savings in minibonds, which claimed to yield 4 percent interest a year.
A settlement may involve payment of about HK$600 million to the bank's disgruntled minibond buyers.
It would also serve as a benchmark for talks between the SFC and other banks to wipe off their respective minibond exposures, the sources said.
The reports come as thousands of minibond buyers prepare to rally on July 1.
BOC (Hong Kong) is estimated to have sold HK$5.6 billion out of HK$14 billion worth of Lehman minibonds bought by 48,000 local investors.
So far, only two institutions - SHKI, a unit of Sun Hung Kai & Co (0086) and KGI Asia Ltd - have settled their minibonds claims.
SHKI distributed payments of HK$85 million among 310 clients while KGI Asia paid five customers about HK$1.6 million.
The talks with SHKI are being used as a model by the SFC for current negotiation with BOC (Hong Kong), sources said.
They said the authorities are keen to settle with BOC (Hong Kong) ahead of July 1 so as not to have angry minibond investors join traditional rallies.
The organizer, Alliance of Lehman Brothers' Victims, yesterday estimated that up to 100,000 of its supporters will march on July 1.
About 400 to 500 investors will protest today against the Hong Kong Monetary Authority and the SFC outside the Legislative Council as HKMA chief executive Joseph Yam Chi-kwong attends a subcommittee hearing on the issue, the group said. Another 2,000 investors plan to march on Sunday from Causeway Bay to the SAR government headquarters.
Earlier this month, the HKMA said it had found sufficient grounds for disciplinary action against some bank staff accused of mis-selling minibonds.
Even though some investors have settled with banks, they only recovered 30 to 50 percent of their investment, the group's chairman, Peter Chan Kwong-yue, said.
Democratic Party member Andrew Fung Wai-kwong said he will file a judicial review for 11 cases before the end of the month against a Small Claims Tribunal decision on March 23 that resulted in all 135 cases being transferred to the District Court.
As of April 8, the HKMA had received 20,724 complaints, and 20,509 had cleared initial assessment.
Only 418 complaints relating to 16 banks were referred to the SFC.
As of last Wednesday, a total of 427 cases had been transferred to the SFC by the monetary authority.
Meanwhile, Liu Sui-fong, 84, is among 77 minibond investors seeking help from the Federation of Trade Unions. Liu said she had been ``misled'' by BOC (Hong Kong) staff to invest all her HK$520,000 savings in minibonds, which claimed to yield 4 percent interest a year.
Monday, April 13, 2009
Review of the public sector
Some people think that the recent cases of food poisoning in the markets reflect slackness in enforcement of cleanliness and health by the National Environment Agency.
But, the underlying problem is a deeper one. In recent years, many government agencies have reduced their manpower in the bid to cut cost. We now have insufficient number of people to enforce the law. This applies not only to this Agency but to many other government bodies as well.
It is one thing to cut down cost and manpower on unnecessary activities and red tape. It is a separate matter when the cost cutting lead to cutback in essential services and enforcement of regulations.
Are the reduced manpower put to better use in society? This is hardly the case. Many of the excess manpower find work in the financial and property markets. These financial experts, advisers and agents help to build up a big bubble that has now burst. Many of them have now lost their jobs or face the prospect of being retrenched.
We need to rethink our approach towards the use of manpower in our society. Public service is an essential source of employment. They can do useful work and can be for the good of society.
Does the reduction of manpower in the public sector lead to lower cost for the public? This may not be the case. Too often, the reduction of manpower is followed by huge expenditure on computer systems, management consultants and high salaries for the top people that run the agencies.
We need to reflect on this matter as well. Are we using the public funds properly? Is there a correct balance between employing people to do useful work or replacing them by expensive systems and so-called talents?
Tan Kin Lian
But, the underlying problem is a deeper one. In recent years, many government agencies have reduced their manpower in the bid to cut cost. We now have insufficient number of people to enforce the law. This applies not only to this Agency but to many other government bodies as well.
It is one thing to cut down cost and manpower on unnecessary activities and red tape. It is a separate matter when the cost cutting lead to cutback in essential services and enforcement of regulations.
Are the reduced manpower put to better use in society? This is hardly the case. Many of the excess manpower find work in the financial and property markets. These financial experts, advisers and agents help to build up a big bubble that has now burst. Many of them have now lost their jobs or face the prospect of being retrenched.
We need to rethink our approach towards the use of manpower in our society. Public service is an essential source of employment. They can do useful work and can be for the good of society.
Does the reduction of manpower in the public sector lead to lower cost for the public? This may not be the case. Too often, the reduction of manpower is followed by huge expenditure on computer systems, management consultants and high salaries for the top people that run the agencies.
We need to reflect on this matter as well. Are we using the public funds properly? Is there a correct balance between employing people to do useful work or replacing them by expensive systems and so-called talents?
Tan Kin Lian
Protecting a democratic institution
The recent change in leadership in AWARE (Association of Women for Research and Education) has raised issues of concern. The old leadership, comprising of volunteers who has worked for many years to build up the values and stature of the organisation was unexpected toppled by a group of new members who voted in a new committee at the annual general meeting.
To my collection, this type of unplanned leadership change has occurred in some other organisations in the past. The new leadership represent the views of a small group of people who attended the annual general meeting, and does not reflect the membership at large.
What can be done to preserve the democratic nature of an organisation and ensure that the elected leaders reflect the values of the membership?
Here are a few possible approaches:
1. Nominations for elected office should be submitted at least 14 days in advance of the general meeting. The nominees should be required to submit a statement to show their background and their plans for the organisation.
2. Voting should be allowed for all members, rather than those who attend the general meeting. With today's technology, it should be quite easy to vote through the internet. Those who attend the meeting can vote on the spot.
Many organisations in Singapore are weak. People are not prepared to serve in the committee. Each general meeting see the return of a few of the well known figures. Occasionally, an upset election results create big news.
We have to address these long standing problems. It is time for us to build stronger democratic institutions in Singapore.
Tan Kin Lian
To my collection, this type of unplanned leadership change has occurred in some other organisations in the past. The new leadership represent the views of a small group of people who attended the annual general meeting, and does not reflect the membership at large.
What can be done to preserve the democratic nature of an organisation and ensure that the elected leaders reflect the values of the membership?
Here are a few possible approaches:
1. Nominations for elected office should be submitted at least 14 days in advance of the general meeting. The nominees should be required to submit a statement to show their background and their plans for the organisation.
2. Voting should be allowed for all members, rather than those who attend the general meeting. With today's technology, it should be quite easy to vote through the internet. Those who attend the meeting can vote on the spot.
Many organisations in Singapore are weak. People are not prepared to serve in the committee. Each general meeting see the return of a few of the well known figures. Occasionally, an upset election results create big news.
We have to address these long standing problems. It is time for us to build stronger democratic institutions in Singapore.
Tan Kin Lian
Annual General Meeting of NTUC Income
The Annual General Meeting is scheduled to be held at 6 pm on Friday, 29 May 2009 at the Auditorium, 7th level, NTUC Income Centre, 75 Bras Basah Road, Singapore 189557.
Sunday, April 12, 2009
China bosses told to cut salaries
Pay of bosses in banks and insurance companies pay is too high. Article.
Saturday, April 11, 2009
A sense of loss as a Singapore (2)
Hi Mr Tan,
I have visited your blog again and have read the comments to my email. I'm not upset, don't worry.
I respect what you are doing. But I do not know whether it will succeed. Singapore has changed. The younger Singaporeans are pleasure-loving and hedonistic, the older ones are too busy struggling. And all of us are struggling in this over-populated country and intimidated by a government that can do whatever they like and manipulate whatever law they want. The worst is seeing younger Singaporeans sell out their countrymen for the love of money.
I empathesize with those who are poor and suffering. I would not mind contributing if you have any schemes to help them. under the present government, they are reduced to getting scraps " qiu sheng bu si, qiu si bu neng" (seeking life is difficult, seeking death is not possible). Perhaps it is possible to set up some sort of recruitment co that matches these people to employers who are willing to pay them fair wages and not exploit them.
As for me, I am thinking of leaving the country next time. I am tired Mr Tan. I am quite well educated, but I still have some integrity. I don't want to sell my soul for money like what some people are doing.
I have visited your blog again and have read the comments to my email. I'm not upset, don't worry.
I respect what you are doing. But I do not know whether it will succeed. Singapore has changed. The younger Singaporeans are pleasure-loving and hedonistic, the older ones are too busy struggling. And all of us are struggling in this over-populated country and intimidated by a government that can do whatever they like and manipulate whatever law they want. The worst is seeing younger Singaporeans sell out their countrymen for the love of money.
I empathesize with those who are poor and suffering. I would not mind contributing if you have any schemes to help them. under the present government, they are reduced to getting scraps " qiu sheng bu si, qiu si bu neng" (seeking life is difficult, seeking death is not possible). Perhaps it is possible to set up some sort of recruitment co that matches these people to employers who are willing to pay them fair wages and not exploit them.
As for me, I am thinking of leaving the country next time. I am tired Mr Tan. I am quite well educated, but I still have some integrity. I don't want to sell my soul for money like what some people are doing.
Friday, April 10, 2009
Equity Linked Notes - are the terms fair?
I was given the Security Purchase Contract Note for an Equity Linked Note. The contract note is very difficult to read, even for an expert like me. The Note was issued by bank X and distributed by bank Y to a Chinese educated elderly person (who does not understand English).
After reading the contract note, I was able to analyse the terms as follows:
a) The note is linked to two shares, A and B
b) Interest is payable at an annual rate of 12% for each day that both shares stay above the trigger price (which is 85% of the reference price). If any share fall below the trigger price, interest is not payable for that day
c) At the end of each observation period (about two months), if both shares are above the trigger price, the Note is redeemed at par, plus accrued interest.
d) On the maturity date (18 months), if any share falls below 70% of the reference price, the investor is given the shares and has to bear the capital loss (of more than 30%).
e) The Notes are principal protected at maturity (provided the Knock-in event has not occurred). There is no mention of the party providing the guarantee, but a statement as follows: "the notebolder is exposed to the credit risk of the issuer or the third party guarantor".
I find this product to be unsatisfactory in the following respects:
1) The "interest payment" is not really "interest". It is actually a risk premium given for providing the insurance against a 30% drop in any of the shares in the basket.
2) It is impossible for the investor to know if the risk premium is fair, given the unknown extent of the risk?
3) The contract is designed by bank X, which stands to gain from the margin between the true cost of the risk and the so called "interest" payable to the noteholder. This can be to the disadvantage of the retail investor, and can in an extreme case, be considered as "cheating" the investor.
There are laws against creating gambling contracts, without approval of the authority. Does this type of equity linked note fall within the definition of a gambling contract? This law was written to prevent the public from being cheated.
Outcome: The issuing bank X went bankrupt. The investor lost the entire principal, amounting to several hundred thousand dollars. The distributing bank Y was negligent in exposing the investor to a large risk - without proper diversification.
If you are in a similar situation, with a similar product, you can write to me at kinlian@gmail.com.
After reading the contract note, I was able to analyse the terms as follows:
a) The note is linked to two shares, A and B
b) Interest is payable at an annual rate of 12% for each day that both shares stay above the trigger price (which is 85% of the reference price). If any share fall below the trigger price, interest is not payable for that day
c) At the end of each observation period (about two months), if both shares are above the trigger price, the Note is redeemed at par, plus accrued interest.
d) On the maturity date (18 months), if any share falls below 70% of the reference price, the investor is given the shares and has to bear the capital loss (of more than 30%).
e) The Notes are principal protected at maturity (provided the Knock-in event has not occurred). There is no mention of the party providing the guarantee, but a statement as follows: "the notebolder is exposed to the credit risk of the issuer or the third party guarantor".
I find this product to be unsatisfactory in the following respects:
1) The "interest payment" is not really "interest". It is actually a risk premium given for providing the insurance against a 30% drop in any of the shares in the basket.
2) It is impossible for the investor to know if the risk premium is fair, given the unknown extent of the risk?
3) The contract is designed by bank X, which stands to gain from the margin between the true cost of the risk and the so called "interest" payable to the noteholder. This can be to the disadvantage of the retail investor, and can in an extreme case, be considered as "cheating" the investor.
There are laws against creating gambling contracts, without approval of the authority. Does this type of equity linked note fall within the definition of a gambling contract? This law was written to prevent the public from being cheated.
Outcome: The issuing bank X went bankrupt. The investor lost the entire principal, amounting to several hundred thousand dollars. The distributing bank Y was negligent in exposing the investor to a large risk - without proper diversification.
If you are in a similar situation, with a similar product, you can write to me at kinlian@gmail.com.
Build MRT internechange stations closer together
At Dhoby Ghaut MRT station, there is a long walk to change from the NS Line to the NE Line, and vice versa.
The NE Line was built many years after the NS Line was operational. It was not possible to build the new station closer to the old station, as it might cause engineering and safety problems.
is there a solution? Give your views here.
The NE Line was built many years after the NS Line was operational. It was not possible to build the new station closer to the old station, as it might cause engineering and safety problems.
is there a solution? Give your views here.
Wednesday, April 8, 2009
Bus stops as landmarks
I have a proposal to use bus stop as landmarks to get to a destination. Read the following. Details.
Tuesday, April 7, 2009
Fear and consequence of retrenchment
If you held a steady job for many years, and you hear that your company has to downsize, what do you do? If you are retrenched, how are you going to find a similar job in a difficult job market? How are you going to pay your bills?
If you have some savings to draw down for a few months or longer, you may be able to tide over the interim period before you find a new job. What if you do not have any savings?
You can pray that you will be spared. But what about your colleagues who are axed?
It is time for us to consider the need for unemployment insurance. If 10% of the workforce has to be axed, an unemployment insurance scheme should pay them, say, 50% of the previous earnings for a period of up to 12 or 24 months. The cost of the unemployment benefit should be paid by those who have jobs. It should cost about 2% to 3% of the payroll. It is a cost that is worth paying to spread the burden.
An alternative to unemployment insurance is a relief loan to pay the above sum to the retrenched workers. As this is a loan, it should be repaid in the future. Interest should be allowed to accumulate with the loan at the same rate paid by the Central Provident Fund.
I hope that an unemployment insurance or relief loan will be introduced by the Government soon, before more people face financial distress due to retrenchment.
Tan Kin Lian
If you have some savings to draw down for a few months or longer, you may be able to tide over the interim period before you find a new job. What if you do not have any savings?
You can pray that you will be spared. But what about your colleagues who are axed?
It is time for us to consider the need for unemployment insurance. If 10% of the workforce has to be axed, an unemployment insurance scheme should pay them, say, 50% of the previous earnings for a period of up to 12 or 24 months. The cost of the unemployment benefit should be paid by those who have jobs. It should cost about 2% to 3% of the payroll. It is a cost that is worth paying to spread the burden.
An alternative to unemployment insurance is a relief loan to pay the above sum to the retrenched workers. As this is a loan, it should be repaid in the future. Interest should be allowed to accumulate with the loan at the same rate paid by the Central Provident Fund.
I hope that an unemployment insurance or relief loan will be introduced by the Government soon, before more people face financial distress due to retrenchment.
Tan Kin Lian
AFP:Hong Kong watchdog slams brokerage in minibond scandal
5 Apr 2009
Hong Kong's securities watchdog has reprimanded a major brokerage for misselling controversial financial products backed by failed US giant Lehman Brothers, a spokesman said Sunday.
KGI Asia Ltd, which has more than 40,000 clients in Hong Kong, has agreed to repay 1.4 million Hong Kong dollars (180,000 US) to five people wrongly sold so-called "minibonds", the Securities and Futures Commission (SFC) said in a statement.
The minibonds have been at the centre of major scandal in the city, after they were sold to investors -- including many vulnerable retirees -- before their value collapsed when the US bank went bankrupt last September.
Following an investigation, the SFC found that KGI Asia had not adequately assessed the risk of the minibonds and that sales staff had not fully understood the products they were selling.
KGI Asia has agreed to fully refund the five clients, none of them professional investors, the SFC statement said. The brokerage has not admitted any liability.
"This outcome resolves our concerns about KGI's past sales practices in respect of Lehman Brothers minibonds, covers present losses incurred to their clients and provides assurance that these problems will not arise again in the future," said Mark Steward, the SFC's executive director of enforcement.
The move is the latest refund by a major financial firm in Hong Kong in the scandal, which has sparked multiple protests as investors claim they were sold the products on the understanding they were rock solid.
But legislators have complained that thousands of misselling cases have still not been dealt with by the regulators, and the firms that sold the products have been dragging their feet.
More than 40,000 Hong Kong investors had put a total of 15.7 billion Hong Kong dollars of their savings into minibonds and other complex products backed by the investment bank.
Former Wall Street icon Lehman Brothers collapsed in September under mountains of debt.
Hong Kong's securities watchdog has reprimanded a major brokerage for misselling controversial financial products backed by failed US giant Lehman Brothers, a spokesman said Sunday.
KGI Asia Ltd, which has more than 40,000 clients in Hong Kong, has agreed to repay 1.4 million Hong Kong dollars (180,000 US) to five people wrongly sold so-called "minibonds", the Securities and Futures Commission (SFC) said in a statement.
The minibonds have been at the centre of major scandal in the city, after they were sold to investors -- including many vulnerable retirees -- before their value collapsed when the US bank went bankrupt last September.
Following an investigation, the SFC found that KGI Asia had not adequately assessed the risk of the minibonds and that sales staff had not fully understood the products they were selling.
KGI Asia has agreed to fully refund the five clients, none of them professional investors, the SFC statement said. The brokerage has not admitted any liability.
"This outcome resolves our concerns about KGI's past sales practices in respect of Lehman Brothers minibonds, covers present losses incurred to their clients and provides assurance that these problems will not arise again in the future," said Mark Steward, the SFC's executive director of enforcement.
The move is the latest refund by a major financial firm in Hong Kong in the scandal, which has sparked multiple protests as investors claim they were sold the products on the understanding they were rock solid.
But legislators have complained that thousands of misselling cases have still not been dealt with by the regulators, and the firms that sold the products have been dragging their feet.
More than 40,000 Hong Kong investors had put a total of 15.7 billion Hong Kong dollars of their savings into minibonds and other complex products backed by the investment bank.
Former Wall Street icon Lehman Brothers collapsed in September under mountains of debt.
Thought for the day: Exploitation by the Elite
"The history of mankind is a history of the subjugation and exploitation of a great majority of people by an elite few by what has been appropriately termed the 'ruling class'. The ruling class has many manifestations. It can take the form of a religious orthodoxy, a monarchy, a dictatorship of the proletariat, outright fascism, or, in the case of the United States, corporate statism. In each instance the ruling class relies on academics, scholars and 'experts' to legitimize and provide moral authority for its hegemony over the masses." : Ed Crane
Fascism should more appropriately be called Corporatism because it is a merger of state and corporate power: Benito Mussolini
Ho Cheow Seng
Fascism should more appropriately be called Corporatism because it is a merger of state and corporate power: Benito Mussolini
Ho Cheow Seng
Monday, April 6, 2009
Banks get guidelines on treating customers fairly
4 April 2009
The Editor
Forum Page
Straits Times
I refer to the article “Banks get guide on treating customers fairly” (ST 4 April).
I congratulate the Monetary Authority of Singapore for taking the appropriate steps to address this issue. However, may I raise a matter of public concern?
Does this imply that in the past, it was all right for the banks to treat customers unfairly? For example, was it all right for a bank to design a complex financial product that give a poor return for the risks embedded in the product and sell the product to an unwary public, without disclosing the relevant information that are available and known by the product issuer?
Were there already laws in place that were supposed to protect the consumers against unfair or predatory practices?
I recall that there were specific requirements under the existing section 199 and 200 of the Securities and Futures Act and under Section 27 of the Financial Adviser’s Act.
A petition was signed by 983 people who alleged that they were misled into investing in several credit-linked notes, such as the Mini-bonds, High Notes, Pinnacle Notes and Jubilee Notes. This petition was lodged with the Monetary Authority of Singapore on 8 October 2008. It requested the MAS or the Attorney General to investigate if there were breaches of relevant provisions under the existing law.
To my knowledge, there was no announcement on the outcome of the investigation, or if such an investigation had been conducted.
If the investment banks that created the products or the financial institutions that sold the products had failed in their duty under the existing law, surely it is the responsibility of the authority to charge them in court and allow the matter to be decided by the court?
If the court had found that the law was vague, then a subsequent step should be taken to clarify the law through new legislation or regulations.
Let me illustrate with this example. Someone broke into a house and took away an expensive notebook computer. The owner lodges a report to the Police. Should the Police now issue a new guide to explain what is house-breaking and theft? Surely, it is the duty of the Police to charge the culprit, with sufficient evidence, and let the court decide on the matter, based on the existing law?
Tan Kin Lian
The Editor
Forum Page
Straits Times
I refer to the article “Banks get guide on treating customers fairly” (ST 4 April).
I congratulate the Monetary Authority of Singapore for taking the appropriate steps to address this issue. However, may I raise a matter of public concern?
Does this imply that in the past, it was all right for the banks to treat customers unfairly? For example, was it all right for a bank to design a complex financial product that give a poor return for the risks embedded in the product and sell the product to an unwary public, without disclosing the relevant information that are available and known by the product issuer?
Were there already laws in place that were supposed to protect the consumers against unfair or predatory practices?
I recall that there were specific requirements under the existing section 199 and 200 of the Securities and Futures Act and under Section 27 of the Financial Adviser’s Act.
A petition was signed by 983 people who alleged that they were misled into investing in several credit-linked notes, such as the Mini-bonds, High Notes, Pinnacle Notes and Jubilee Notes. This petition was lodged with the Monetary Authority of Singapore on 8 October 2008. It requested the MAS or the Attorney General to investigate if there were breaches of relevant provisions under the existing law.
To my knowledge, there was no announcement on the outcome of the investigation, or if such an investigation had been conducted.
If the investment banks that created the products or the financial institutions that sold the products had failed in their duty under the existing law, surely it is the responsibility of the authority to charge them in court and allow the matter to be decided by the court?
If the court had found that the law was vague, then a subsequent step should be taken to clarify the law through new legislation or regulations.
Let me illustrate with this example. Someone broke into a house and took away an expensive notebook computer. The owner lodges a report to the Police. Should the Police now issue a new guide to explain what is house-breaking and theft? Surely, it is the duty of the Police to charge the culprit, with sufficient evidence, and let the court decide on the matter, based on the existing law?
Tan Kin Lian
Sunday, April 5, 2009
Fat fees for speaking engagements
A reader pointed out that the leaders of the advanced democracies earn modest salary when they were in public service, but received fat fees for public speaking after their retirement from politics. There is an article in the Straits Times about the speaking fees received by a former politician.
These fees were paid by the commercial conference organizers, who were able to get the participants to pay the fees to make it viable.
They also get big corporate sponsorships It is likely that the big corporations, which made huge profits from the free market policies, now expect to assistance of the retired politicians in their lobbying. This is unsatisfactory, but is quite unfortunate.
We need a world, and leaders, that are more honorable. They should take care of the ordinary people, rather than for personal enrichment.
These fees were paid by the commercial conference organizers, who were able to get the participants to pay the fees to make it viable.
They also get big corporate sponsorships It is likely that the big corporations, which made huge profits from the free market policies, now expect to assistance of the retired politicians in their lobbying. This is unsatisfactory, but is quite unfortunate.
We need a world, and leaders, that are more honorable. They should take care of the ordinary people, rather than for personal enrichment.
Honesty and rationalisation
We think of honesty in terms of financial dealings. We also need to think of honesty in terms of speaking the truth.
If we make a mistake, we should admit it. We should not try to find some angle to explain it away. We should not "rationalise" our action, which is what smart but dishonest people are quite used to do.
If we do not know the answer, we can state the fact. We can seek advice. Or just give it a try.
In an artilce in the Straits Times today stating that Franklin Roosevelt was not sure about how to bring America out of the depression in the early 1930s. He took some bold steps, but admitted that he did not know if it would work. Barrack Obama is now taking the same approach to overcome the global financial crisis 80 years later.
There are some people who have never made a mistake in their lives, because they are able to rationalise it, and explain it away.
Tan Kin Lian
Friday, April 3, 2009
Health care reform in the USA
Will insurers once again scupple the health-care reform? Article in Economist.
SCMP: Details urged on Minibond saga
Lawmakers are still seeking Monetary Authority chief executive Joseph Yam Chi-kwong's disclosure of its full report on the Lehman Brothers minibonds saga, after he cited reasons of public interest in not revealing it. Raymond Ho Chung-tai, chairman of the Legislative Council subcommittee investigating the matter, said if Mr Yam insisted on his position at an April 14 hearing, he and deputy chairman Philip Wong Yu-hong would arrange a closed-door meeting to ask for an explanation.
MY COMMENT
It seems that the authority can hide the truth, by citing public interest. This seems to be the practice in Singapore as well. I hope that we can have a more honest, open society, with greater transparency.
Survey: MAS guide on treating customers fairly
MAS has issued a new guide to banks on treating customers fairly. The yardsticks are:
1. Customers have confidence that they deal with financial institutions where fair dealing is central to the corporate culture
2. Financial institutions offer products and services suitable for their target customer segments.
3. Financial institutions have competent representatives providing customers with quality advice and appropriate recommendation.
4. Customers receive clear, relevant and timely information to make informed decisions.
5. Financial institutions handle customer complaints in an independent, effective and prompt manner.
What are your views on the existing situation and the new MAS guide? Survey.
1. Customers have confidence that they deal with financial institutions where fair dealing is central to the corporate culture
2. Financial institutions offer products and services suitable for their target customer segments.
3. Financial institutions have competent representatives providing customers with quality advice and appropriate recommendation.
4. Customers receive clear, relevant and timely information to make informed decisions.
5. Financial institutions handle customer complaints in an independent, effective and prompt manner.
What are your views on the existing situation and the new MAS guide? Survey.
Public Service
I respect the political leaders in the democratic countries, especially those of Europe and North America.
They entered politics as a public service. They desire to make life better for the people. They have strong values and beliefs (whether leaning to the left, right or center) and wish to influence the future of their nation.
They are happy to receive a remuneration of 3 to 10 times of the average wage of their ordinary people. They do not expect a remuneration that is 100 times or more (i.e. the salary paid in the private center for top exectives).
By accepting the modest remuneration of the public service, they are able to exercise some moral control over the excessive and unjustified salaries paid in the private center.
Tan Kin Lian
HK: Relief appears to be near for Lehman minibond holders.
There are sufficient grounds for disciplinary action against some bank staff accused of misselling the minibonds, according to the Hong Kong Monetary Authority.
And market sources say the Securities and Futures Commission is pushing big banks to follow in the footsteps of Sun Hung Kai Investment and settle with disgruntled customers.
HKMA executive director Raymond Li said yesterday that "a few cases are already at a very advanced stage of investigation,'' he said adding, "Should any case be concluded we would definitely tell the public."
According to procedures, anyone accused of misselling will have at least 30 days to make a representation and another 21 days to appeal if their explanations are rejected before their case goes public. As of yesterday, the HKMA had got 20,642 complaints, and 20,443 had cleared initial assessment.
So far, files have been opened for just 5,772 cases, of which 4,178 have gone through a preliminary investigation. Only 418 complaints relating to 16 banks were referred to the SFC.
Li blamed the slow progress on the reluctance of complainants to provide useful information in most of the cases.
But he reiterated that the authority will complete investigating at least 70 percent of complaints by March 2010.
"We are recruiting more staff both part-time and those on secondment to accelerate the process," he said. About 200 staff will be involved.
Li said a client's interest was the HKMA's priority, and if a settlement without punishment was the best solution it would get the authority's support.
And market sources say the Securities and Futures Commission is pushing big banks to follow in the footsteps of Sun Hung Kai Investment and settle with disgruntled customers.
HKMA executive director Raymond Li said yesterday that "a few cases are already at a very advanced stage of investigation,'' he said adding, "Should any case be concluded we would definitely tell the public."
According to procedures, anyone accused of misselling will have at least 30 days to make a representation and another 21 days to appeal if their explanations are rejected before their case goes public. As of yesterday, the HKMA had got 20,642 complaints, and 20,443 had cleared initial assessment.
So far, files have been opened for just 5,772 cases, of which 4,178 have gone through a preliminary investigation. Only 418 complaints relating to 16 banks were referred to the SFC.
Li blamed the slow progress on the reluctance of complainants to provide useful information in most of the cases.
But he reiterated that the authority will complete investigating at least 70 percent of complaints by March 2010.
"We are recruiting more staff both part-time and those on secondment to accelerate the process," he said. About 200 staff will be involved.
Li said a client's interest was the HKMA's priority, and if a settlement without punishment was the best solution it would get the authority's support.
Thursday, April 2, 2009
The Whole Truth
Dear Mr. Tan,
Some people play with words to an extent that it is difficult to know the difference between the truth and lies.
If a business reduce the benefit significantly last year, can they now say that the action has benefited the customers, because they do not need to reduce the benefit further this year?
Similarly, can the government, after increasing tax and levy, now give a smal rebate and say that they are benefitting the taxpayer with the rebate?
REPLY
I agree with your view. It is now quite difficult to tell the difference between honesty and dishonesty. Mr. S Rajaratnam once said that there are difference between "the truth, the whole truth and nothing but the truth". We have to learn what is the "whole truth".
Submitting Income Taxi by e-Filing
I submitted my income tax returns for 2008 by e-filing.
IRAS has designed a sophisticated and expensive computer system for e-filing. It must have cost a lot of money. It was supposed to make e-filing easy for the tax-payer.
Unfortunately, it was very difficult - even for an internet savvy person like me. Why? It is a matter of mindset. The experts in IRAS designed a system that is convenient for them. They forget to make it convenient for the ordinary people.
What is a system that is convenient for ordinary people? Just provide a simple form to ask me to submit the details of my income and claim. Use a format that is convenient for the tax payer to fill in - not a format that is convenient for IRAS to do their workflow.
But, I have to commend IRAS for one excellent aspect of the system. They display the information that they have, taken from various sources, that are relevant for my tax computation. This includes my chartiable donations and topping up of CPF account for family members. I appreciate it very much.
I hope that IRAS will take my suggestion about making it easy for me to submit their annual return, especially for items that are not captured by IRAS.
Tan Kin Lian
Additional comments
It is easy to use e-filing, if you do not need to provide additional sources of income or other charges. However, it is quite troublesome to provide the additional information, for example on property, life insurance policies and deductions, as they are designed to be helpful to IRAS and not customer friendly. It is also difficult to search for the right places to provide the information, as they are placed all over several web pages and tabs.
Buy Term Insurance
Dear Mr. Tan,
May I know which company you'd recommend for buying "Term", "Decreasing Term" and "Living Benefit" policies you described in your FAQ: http://www.tankinlian.com/faq/choice.html
REPLY
You can buy Term insurance from NTUC Income (they call it i-Term). But do not allow them to convince you to buy other life insurance policies.
You can also buy i-Term from Philips Securities. They sell i-Term offered by NTUC Income. You can find out from their website. All the best!
May I know which company you'd recommend for buying "Term", "Decreasing Term" and "Living Benefit" policies you described in your FAQ: http://www.tankinlian.com/faq/choice.html
REPLY
You can buy Term insurance from NTUC Income (they call it i-Term). But do not allow them to convince you to buy other life insurance policies.
You can also buy i-Term from Philips Securities. They sell i-Term offered by NTUC Income. You can find out from their website. All the best!
Relief loan is similar to early withdrawal from CPF
I have proposed that retrenched workers should be allowed to take a relief loan, offered by a Government agency, at an interest rate of 2.5% per annum. This should also be available to workers who suffered a drop of earnings due to a reduction in working hours.
This relief loan is similar to an unemployment benefit, but has to be repaid in the future. Interest on the loan can be accumulated with the principal. The borrower has the incentive to repay the loan earlier, to avoid incurring interest charges.
My proposal is similar to early withdrawal from the CPF. The loan incurs interest charge of 2.5%, which is similar to the interest earned on CPF savings. There is no additional cost to the borrower under my proposed relief loan scheme.
My proposal is intended to protect the integrity of the CPF as a saving plan for retirement. There is a reminder on the borrower to repay the relief loan. However, if the loan is not repaid, it will be repaid from the CPF savings at the time of its withdrawal.
My proposal will also offer relief to the retrenched worker in the case where there is no CPF savings to withdraw from, e.g. where the savings have been fully used to buy a property.
Tan Kin Lian
Wednesday, April 1, 2009
Ready Pool of Part Time Workers
To employers. There is a ready pool of part time workers. They are willing to work for $6 to $9 per hour. You can choose a worker that stays near your place of business, and likes the type of work that you do. Go to this portal.
Click on employer. Sign up and select your workers. You can send a SMS for them to call you.
Intelligence Quiz
Compensation for Credit Linked Notes
If you have not been offfered or have rejected an inadequate offer of compensation, and you wish to lodge a complaint with FIDREC or take legal action, please provide your particulars in this survey.
10 highest paid politicians in the world
Report.
Annual salaries in USD
1. Lee Hsien Loong - Singapore Salary in dollars - $2.47 million
2. Donald Tsang Yum-Kuen - Hong Kong Salary in dollars - $516,000
3. Barack Obama - United States Salary in dollars - $400,000
4. Brian Cowen - Ireland Salary in dollars - $341,000
5. Nicolas Sarkozy - France Salary in dollars - $318,000
6. Angela Merkel - Germany Salary in dollars - $303,000
7. Gordon Brown - UK Salary in dollars - $279,000
8. Stephen Harper - Canada Salary in dollars - $246,000
9. Taro Aso - Japan Salary in dollars - $243,000
10. Kevin Rudd - Australia Salary in dollars - $229,000
A sense of loss for a Singaporean
Hi Mr Tan,
I have been following with interest your blog on and off especially during the period of "minibonds". I respect your sense of social justice and your courage and willingness to fight for the underdogs.
I myself have always been neutral to politics. I only write today because on the spur of the moment, I want to pass a few observations about the passing away of the Singapore I grew up in.
I am in my 30s. When I am young, I felt that the government was willing to develop us Singaporeans. Life was simple, relations with people were sincere.
That Singapore is no more. In almost any job I have worked, foreigners equal Singaporeans in number, sometimes they exceed. Even when you interact with people, the locals don't care for and about the locals. Money is all everyone thinks about. Perhaps it is because we are all forced to struggle with the influx of so many FTs.
When we need employers to give us a chance, we find that the job has gone to some more experienced FT. But they were given chances, even sponsored to take courses, back in their own countries to hone the skills that they have today.
I have been following with interest your blog on and off especially during the period of "minibonds". I respect your sense of social justice and your courage and willingness to fight for the underdogs.
I myself have always been neutral to politics. I only write today because on the spur of the moment, I want to pass a few observations about the passing away of the Singapore I grew up in.
I am in my 30s. When I am young, I felt that the government was willing to develop us Singaporeans. Life was simple, relations with people were sincere.
That Singapore is no more. In almost any job I have worked, foreigners equal Singaporeans in number, sometimes they exceed. Even when you interact with people, the locals don't care for and about the locals. Money is all everyone thinks about. Perhaps it is because we are all forced to struggle with the influx of so many FTs.
When we need employers to give us a chance, we find that the job has gone to some more experienced FT. But they were given chances, even sponsored to take courses, back in their own countries to hone the skills that they have today.
All familial ties are no more; we have became disposable entities to our companies and our bosses. It is a very lope-sided system where the employer is king. Even some bosses, used to maids, treat employees in the same disposable manner. Forget about receiving any training, you are paid to serve them. Retrenchment and dismissal is sometimes the excuse of poor senior management. The same goes for the present government.
I am neither bitter nor resigned. I am just sad that I cannot identify this country with the one I knew and grew up in. You might tell me I am being sentimental, we must all adapt to the world, there is no free lunch. Yes I have heard that many times. And home-grown Singaporeans are largely a docile bunch willing to bend over backwards with the govt. But why does it seem that the govt makes our problems worse instead of better?
You are very capable man. By writing to you, I don't dare to aspire for anything. I have signed your petitions and I have written encouraging messages on your blog. I just want to share with you, Singaporean to Singaporean, the loss of the soul and essence of my country.
I am neither bitter nor resigned. I am just sad that I cannot identify this country with the one I knew and grew up in. You might tell me I am being sentimental, we must all adapt to the world, there is no free lunch. Yes I have heard that many times. And home-grown Singaporeans are largely a docile bunch willing to bend over backwards with the govt. But why does it seem that the govt makes our problems worse instead of better?
You are very capable man. By writing to you, I don't dare to aspire for anything. I have signed your petitions and I have written encouraging messages on your blog. I just want to share with you, Singaporean to Singaporean, the loss of the soul and essence of my country.
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