05-07-2013, 07:46 AM
CREDIT CRUNCH
Temasek's Chinese bank stakes 'not affected'
Published on Jul 05, 2013
By Alvin Foo
TEMASEK Holdings believes the credit crunch now going on in China will not affect its substantial bank stakes there.
Mr Chia Song Hwee, Temasek's co-head of China, said at a briefing yesterday: "There is sufficient liquidity in the system, so we are not concerned about a liquidity crunch over a prolonged period.
"The banks that we have invested in are actually very well capitalised," he added.
Mr Chia also heads Temasek's Investment Group.
China's credit crunch stems from moves by its central bank to rein in a sharp growth in informal lending among companies by allowing interest rates to surge to record levels.
China accounts for 23 per cent of Temasek's portfolio, second only to Singapore's 30 per cent in terms of country mix.
Its stake in China Construction Bank was valued at HK$110.5 billion (S$18.1 billion) as of March 31 and comprises 8 per cent of Temasek's total portfolio.
Only SingTel at 14 per cent has a higher share.
Temasek has also invested heavily in Industrial & Commercial Bank of China, in which it holds a 1 per cent stake, pumping in an estimated US$2.4 billion (S$3 billion) since 2012 alone.
Financial services continued to be Temasek's largest portfolio exposure by sector, accounting for 31 per cent of its investments.
alfoo@sph.com.sg
Temasek's Chinese bank stakes 'not affected'
Published on Jul 05, 2013
By Alvin Foo
TEMASEK Holdings believes the credit crunch now going on in China will not affect its substantial bank stakes there.
Mr Chia Song Hwee, Temasek's co-head of China, said at a briefing yesterday: "There is sufficient liquidity in the system, so we are not concerned about a liquidity crunch over a prolonged period.
"The banks that we have invested in are actually very well capitalised," he added.
Mr Chia also heads Temasek's Investment Group.
China's credit crunch stems from moves by its central bank to rein in a sharp growth in informal lending among companies by allowing interest rates to surge to record levels.
China accounts for 23 per cent of Temasek's portfolio, second only to Singapore's 30 per cent in terms of country mix.
Its stake in China Construction Bank was valued at HK$110.5 billion (S$18.1 billion) as of March 31 and comprises 8 per cent of Temasek's total portfolio.
Only SingTel at 14 per cent has a higher share.
Temasek has also invested heavily in Industrial & Commercial Bank of China, in which it holds a 1 per cent stake, pumping in an estimated US$2.4 billion (S$3 billion) since 2012 alone.
Financial services continued to be Temasek's largest portfolio exposure by sector, accounting for 31 per cent of its investments.
alfoo@sph.com.sg