Financial Times, 7 Feb 2009
It has been a torrid few months for Temasek, given that 40 per cent of its portfolio is in financial stocks, but it will be some months before it will need to publicly disclose just how painful it has been.
Among its most high-profile picks since 2007 were sizeable investments in Merrill Lynch and Barclays.
The fund is estimated to have accumulated unrealised losses of more than $2bn, excluding any hedges, relating to its Merrill stake, which has now been converted into Bank of America stock.
Likewise, its investments in Barclays, the UK lender, since 2007 have left it with paper losses of billions of dollars. As a result of the implosion in financial stocks, Temasek is expected to post possibly its worst returns since being established in 1974, after which it has generated an annual average return of about 17 per cent.
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