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Temasek Holdings recovers huge portfolio losses with $37bn value gain (+40%) in Q2

Posted on 11 August 2009

From Komfie Manalo, Opalesque Asia: Singapore’s state fund Temasek Holdings has recovered a huge portion of its portfolio losses since March-09 as its value saw a major rebound on a strong global equity markets performance, according to a Strait Times analysis.

Asiaone.com, which quoted the report, said that Temasek had reaped an estimated $37bn gain from March 31 to July 31, or a 40% upswing. Findings showed that much of Temasek’s gains since the end of March had been driven by its exposure to financial firms.

It added that the jump in value saw Temasek’s portfolio reach about $164bn at the end of July. The publicly-listed fund lost over $40bn for the 12 months to March 31 this year.

Temasek tries new tack to counter losses

Last month, Temasek announced it had introduced radical changes in the direction of the state-run funds to counter losses.

According to a report by WSJ.com, Temasek allowed institutions, as well as Singapore’s public, to team up on the firm’s investments. Temasek offered few details on the plan.

The plan set Temasek apart from the world’s other government-run funds, because it became more transparent, a rare quality with sovereign wealth funds, the report said.

Temasek problems, real or just PR issue

In June, Bryan Goh’s article in Opalesque noted that Temasek’s track record had been under fire because of its investments in Merrill and Barclays.

Goh said: “Temasek should not shy away from taking risk, particularly now. The last 30 years have seen steady growth in economies and wealth. The democratization of risk through the rise of derivatives, the growth of capital employed in active management across markets, in arbitrage and relative value as well as traditional investing, the widening and deepening of markets, have all contributed to a gradual reduction in continuous risk.”


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