Swiber Holdings

[CY09]

To D.O.G: Thank you for breaking down the guess estimate value of each component, but it seems DBS is taking loss provision despite the analysis of a near certainty of getting its loans back, could it be because DBS is backing the notes in some way - similar to Ezion notes? This creates off balance sheet liabilities for DBS

There are several ways that DBS could have losses on its loans:

1. Unsecured loans to the JVs and associates. These would not appear on Swiber's balance sheet.

2. DBS is holding some of the Notes. It underwrote the Notes, maybe it couldn't sell them all so it had to hold the remainder.

3. DBS might have lent money on a non-recourse basis to private banking clients to buy the Notes.

If DBS does the 3rd one, then it is really silly. It is like heads the private bankers win, tails the bank loses. 

But then again, it is also possible that DBS is being more prudent to set aside an additional 150m of allowances, there may still be chance of a reversal if it can collect back more money that it estimated

I am a holder of DBS shares and am against their "save all Singaporean big oil services companies" policy i.e. see Ezra (USD1bn outstanding to DBS, a sinking ship) and Ezion and KrisEnergy (just bought over the entire RCF from other banks). It doesn't make any economic sense.

Our economic model is not a pure capitalist model. There will be times when national companies have to do public service, when majoirty shareholder tells you so