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Temasek
raises stake in Standard Chartered to 18%
Chia-Peck
Wong
Bloomberg
24 Dec
07
http://www.bloomberg.com/apps/news?pid=20601087&sid=a9kK9GTD37GU&refer=home
Temasek
Holdings Pte, the biggest shareholder in Standard Chartered Plc,
increased its stake in the U.K. bank to 18 percent, boosting the
financial-services investments in its $100 billion portfolio.
Set up in 1974 to run Singapore's state assets, Temasek
also has stakes in ICICI Bank Ltd. of India, Bank of China Ltd.
and DBS Group Holdings Ltd., Southeast Asia's biggest bank.
Temasek bought 12 million Standard Chartered shares, raising its
holding by one percentage point, the bank said in a Dec. 21
filing.
Standard Chartered gets most of its profit from
Asia and spent more than $2.7 billion since 2006 on acquisitions,
including Hsinchu International Bank in Taiwan and Union Bank
Ltd. in Pakistan. This month, the London-based company said it
would accelerate investment in emerging markets, avoiding a
potential decline in revenue faced by U.K. rivals such as
Edinburgh-based HBOS Plc, which depend mainly on Britain.
"Standard Chartered is very well exposed to the
emerging markets, which many view as very exciting,'' said Teng
Ngiek Lian, who manages $3 billion of Asian stocks as chief
executive officer of Target Asset Management in Singapore. "Most
of Temasek's investments in the banking sector are doing very
well.''
Standard Chartered rose 1.5 percent to 1,862
pence by 11:23 a.m. in London trading. The stock has gained 25
percent this year, the best performer on the nine-member FTSE
All-Share Banks Index.
The shares purchased by Temasek,
worth 220 million pounds ($436 million) at Standard Chartered's
Dec. 21 closing price of 1,835 pence, lift the total holding to
253.7 million shares.
"Comfortable"
with shareholding
Temasek first bought a 12 percent
stake in Standard Chartered from the estate of late Singapore
hotelier Khoo Teck Puat in March 2006, and held 13 percent of the
bank as of March this year, according to its annual report. It
may also invest $5 billion in Merrill Lynch & Co., the Wall
Street Journal reported last week, citing unidentified people.
"We are comfortable with our current level of
shareholding'' in Standard Chartered, Simon Israel, executive
director at Temasek, said in an e-mailed statement today. "As
a financial investor, we are not involved in the bank's board and
management.''
Israel didn't comment on the Merrill report
in today's e-mail. The Journal said Dec. 21 the Singapore fund
will invest in the world's biggest brokerage through a cash
infusion.
Biggest industry
Merrill
announced $8.4 billion of writedowns on mortgage- related
investments and corporate loans on Oct. 24, and then ousted Chief
Executive Officer Stan O'Neal. The stock rose 1.9 percent
following the report on Temasek's investment.
The latest
purchase puts Standard Chartered closer to a threshold that would
make it unable to issue notes in Hong Kong. The city will bar
lenders that are 20 percent owned by foreign governments from
issuing bank notes denominated in the local currency, the Hong
Kong Monetary Authority said in July.
Investments in
financial services companies accounted for 38 percent of
Temasek's portfolio in the year ended in March, compared with 35
percent a year earlier, making it the biggest industry for the
company's assets, according to the annual report.
To
contact the reporter on this story: Chia-Peck Wong in Hong Kong
at cpwong@bloomberg.net
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