Taking Hits, Temasek’s Assets Slide 31%

The value of Temasek Holdings Pte. Ltd.’s investment portfolio fell 31% in the eight months that ended in November 2008, the Singapore government said.

The portfolio’s net value on Nov. 30 was 127 billion Singapore dollars (US$85 billion), compared with S$185 billion as of March 31, Senior Minister of State for Finance Lim Hwee Hua told Parliament on Tuesday.

Temasek, an investment company owned by the Singapore government, has taken hits from sizable investments in several global financial giants, including the former Merrill Lynch.

The figures on portfolio performance, part of Ms. Lim’s response to questions from members of Parliament, came four days after Temasek announced that Chief Executive Ho Ching, the wife of Prime Minister Lee Hsien Loong, would step down on Oct. 1 and be succeeded by Charles “Chip” Goodyear, an American who formerly was CEO of mining behemoth BHP Billiton.

The change of leadership has prompted some analysts to speculate that Temasek might in the future make a push in commodities. Temasek officials say the company has begun a review of its long-term plans.

On Tuesday, Ms. Lim said the fall in Temasek’s portfolio from April through November compared with declines of 44% for the MSCI Singapore index and of 45% for the MSCI Asia ex-Japan index during the same period. She said Temasek and the Government of Singapore Investment Corp., which manages the city-state’s reserves, are “long-term investors, and should be evaluated as such.”

Both Temasek and GIC “have the ability and resources to weather the ups and downs, over multiple economic and market cycles,” she said. They don’t have to make panic sales and are “in fact in an advantageous position to invest in good quality assets at prices that are attractive from a long-term perspective during a downturn,” Ms. Lim said.

She said the Singapore government is “confident that they will continue to deliver good long-term returns within the risk limits set.”

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