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Thursday, 7 June 2018

Temasek delivers 13% return for the year; Record net portfolio value of S$275 billion; Up S$111 billion over the decade (Refresh)

Read? Temasek delivers 13% return for the year; Record net portfolio value of S$275 billion; Up S$111 billion over the decade

Read? Excited By 4.35% Astrea IV Class A-1 Secured Bonds Issue By Temasek???

Hmm ..

4.35% Astrea IV Class A-1 Secured Bonds Issue By Temasek

i.e. generating 4.35% fixed ROC for retail for the next 10 years.

But ...

Temasek : 20 years (1998 to Mar 2017) is 6%
Temasek : 10 years (2008 to Mar 2017) is 4%

Thinking why like that ah?

What is missing?


  1. Errr ... maybe becoz it paid too much for foreign banks like UBS, BoA, CCB, ICBC, BOC? Heheh, Temasek's fund managers got a fetish for financial industry?

    And also bad luck lah ... many of the major GLCs kena bad fengshui in industries like MRT, taxi, oil & gas, shipping, mail, telco ...

    I'm sure the next Temasek / GIC annual report will be a very good one. :)

    Regarding performance of PE funds, can take a look at CALPERS below. Some of the underlying in Astrea IV are also invested by Calpers ... just type in the 1st word of the 36 PE funds in the textbox to automatically find.

    Private equity program fund performance

    From the comments in blogosphere, Astrea IV will be selling like hot cakes! Hoho!!

    1. Many are hungry for yield since no bear market on sight. Over subscribed!

  2. Uh, firstly, Temasek did not issue this bond. Astrea did, and they're wholly owned by Temasek. There's a difference there. As long as Astrea's performance exceeds 4.35%, then that issue of their bond will have no issue.

    Temasek as a wide portfolio of companies, Astrea is but a small size for them. How can we take Temasek's performance and compare with this bond issuance?

    1. Heheheh Uncle8888 just want people to think harder lah... :)

      Yup, Astrea IV bond is issued by Astrea IV Pte Ltd, which is a special purpose vehicle owned by (but separate from) Azalea Asset Mgmt Pte Ltd which is owned by (but separate from) Temasek Holdings Pte Ltd.

      Hence Azalea is one of the many many private equity investments directly or mostly under Temasek.

      Therefore Astrea IV is a bond from an SPV backed by bunch of PE owned by a PE of Temasek. Hahaha.

      Nothing wrong with this setup. Similar to most things done in the last 50 years e.g. Minibonds, High Notes, and all the condo projects as well as infrastructure projects like power plants, office buildings & shopping malls. In fact, it is the correct & right thing for companies to do if dealing with large financial liabilities.

      From looking at the financial structure of Astrea IV, very low chance of class A-1 retail losing their capital.

      If you trust statistics & probability (haha!), Monte Carlo simulations show 99.99% chance of capital payback in 5 yrs even if all the PE funds perform in the bottommost 25% percentile.

      92.7% chance if another GFC happens and all PE fund cashflows stop for 3 years. But even for GFC scenario, 100% chance capital payback by 10 years.

      Azalea calculates that in the "GFC scenario" the A-1 class bonds will be fully redeemed by 6th year.

      For sure we'll have another recession within the next 5 years, but whether it's going to be as bad as or worse than GFC is anybody's guess. Maybe it will just be a mild -25% bear market, who knows??

      Astrea IV good for those who want to park some of their money for 5+ years and forget about it. For those who think there will be better opportunity within next 5 years for market lows, then better to reserve cash / bullets for greater flexibility.

  3. Alas only UT 100K/individual.

    Not for U lah?


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