Martin Lee @ Sg
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Minibond Series Update For Investors

Following a protest by several Hong Kong investors about how they were mislead into buying the Lehman Minibond Series, the Hong Kong Monetary Authority (HKMA) convened a meeting yesterday between representatives of investors who had purchased the Minibond, representatives of banks that had sold them and the trustees who are holding the collateral for the investments.

For the time being, hotlines have been setup by the various distributors to address the investors’ concerns.

The Straits Times also reported how many investors from Hong Kong, Indonesia and Singapore were not advised properly that the Minibonds they were buying actually contained complex derivatives.

The Monetary Authority of Singapore has issued a statement offering the following advice:

  • People who think they have been mis-sold the product should contact the financial institute they bought it from.
  • If the consumer is not satisfied with the FI’s response and they have a legitimate cause of grievance, they can approach FIDReC which is the independent organisation set up to help resolve disputes in the financial sector.

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50 comments
Ang says 10 years ago

Our minister is still talking about Lehman’s BONDS! Isn’t it clear that Lehman minibonds sold in SG has nothing to do with bonds???

http://www.mas.gov.sg/news_room/parliamentary_questions/2008/Reply_to_PQs_on_the_Sale_of_structured_products_to_retail_investors.html

“Any assessment of whether mis-selling occurred has to take into consideration circumstances at the time of the sale and not what we now know. For example, until July this year, Lehman’s bonds were rated “A1” and “A” by Moody’s and S&P respectively. “

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Johnny says 10 years ago

This Lehman saga goes to show one thing, if anything. No one wants to take responsibility when the ship sinks. Isn’t it always easier to blame the ‘iceberg’, the ‘weather’, the ‘structure of the ‘ship’…etc? I guess until and unless enough publicity has been generated, hopefully only the whole of Singapore knows about this issue, then would the relevant authority step up on their investigation. Meanwhile, let’s keep our fingers crossed.

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    richard says 10 years ago

    As I reflected on this Lehman saga, I can only sighed sadly
    that this branded can of worms labelled ‘Minibond’ is camoflouged and
    packaged so attractively that it is able to hookwink all and sundries.
    I think “shared responsibilities”by all parties would expeditiously bring this episode to a close and everyone can move on.

    Reply
      Kenneth says 10 years ago

      As of today, the pubilicity are:

      i) 2 Hong Lim Square sessions
      ii) 2 petition to MAS
      iii) Mr. Tan and SM Goh talked on the phone
      iv) Numerous newspaper publication
      v) Get Real tonight
      vi) Parlimentary discussion

      Conclusion: Hong Kong MAS 1 Sgp MAS -1

      Govt = MAS = FIs = -1

      Reply
chris says 10 years ago

Anybody read Strait Times, Pg A31 today (9 Oct)? Does it mean that Series 5 and 6 are confirmed to be unwind by HSBC?

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John R. Davis says 10 years ago

UBS sold me 180,000 worth of 100% principle protected Notes. i am retired and have consistently advised my adviser I cannot afford to loose any money – that i only wanted safe investments. He honestly sold th4ese to me with the understanding that they were safe.

Now that LB has gone bust – UBS has frozen my 180,000.00 investment in what was sold as 100% safe investments – and has not release my money to me. Since I purchased them through UBS – they are the institution that has to make their investors in this product whole. So far they have not, My Financial Planner moved to Merrill Lynch – I moved with him so that he can now figerously pursue the people at UBS to return my money (fully) to me.

UBS hierarchy is criminal in its action – and one way or the other they will have to pay up or face class action/mass action suites.

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    Kenneth says 10 years ago

    My Series 3 was sold to me with a misconception that it is a bond to 6 Banks and if I hold for 5 – 3/4 years, the principle will be returned. The way they put it is sounds like it was protected. According to the forum, gurranteed & protected principle is very different. Protected principle and still go bust.

    I had a protected principle in DBS [DBS again!!!!] Startrack but when it matured in Aug 2008, I had only 99.10% of principle back. Bear in mind that for the last 5 years, I got 0 dividend given the 3 stocks they picked did not perform in DJ while DJ was having a record breaking time. Most of the funds were use to purchase bonds but one of the bond from GE was downgraded in 2005 thus the switch made them loss money.

    Safer to get principle gurranteed, even though is lower interest. The risk is the issuer can still go bust. As my FA is a personal friend, thus the trust level is high which ends up with this crap. In future, as long as not in black and white, everything FA says is sales pitch. The other problem is FA don’t even know they are selling a high risk products. If only they can stand up and voice that they were also mis-informed by their respective Financial institution, we continue to face a uphill task in persuing a class suit.

    Regards,

    Reply
johnny1186 says 10 years ago

For my fellow Singaporean netters who read Chinese:

http://hk.news.yahoo.com/article/081006/4/8krk.html

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bukem says 10 years ago

The underlying assets of the notes are likely subprime CDOs. Looks like even if no credit event has occured the notes are already very soured. Hold to maturity doesnt seems to help either unless Americans pay up their mortgages soon?

Article below written in 2006:

Business Times
23/08/06

What are structured notes?

IF YOU are like most Singaporeans, you’d be attracted to products offering a high yield or interest rate. But you may be taking on more credit risk than you bargained for.

Two new structured notes – launched separately by Lehman Brothers and Morgan Stanley – hit the shelves of brokerages and some banks recently. Lehman’s offer closed last week, but Morgan’s is still open.

Their coupons – between 4.88 and 4.95 per cent per annum for terms of longer than five years – certainly seem very attractive beside fixed deposit rates and local bond yields. Five-year Singapore government bonds currently yield about 3.16 per cent.

But the big question is: are the risks sufficiently explained to investors who are more familiar with fixed deposits than collateralised debt obligations (CDOs)?

Further, are you sufficiently compensated for the risks you take on?

As always, there is no free lunch in the investment world. Today, banks are increasingly rolling out higher deposit rates, but on a short term promotional basis. For instance, if you deposit fresh funds with DBS and also invest in unit trusts or structured deposits, you could get a three-month rate of between 3.425 and 5.7 per cent per annum, depending on the deposit amount.

For those who prefer insurance, endowment products offer the usual blend of guaranteed and non-guaranteed returns. Based on quotes obtained by Executive Money, the annualised yield-to-maturity ranges between 2.6 per cent for Prudential and about 3.12 per cent for Asia Life for a five-year term.

More opportunities

As the tightening cycle appears to be nearing its end, now may be a good time to lock in yields on fixed income assets. Bond managers now see more opportunities, particularly on the longer end.

Lim Heong Chye of APS Komaba says of the US market: ‘Rates at the short end are peaking; at most they may go up another 25 basis points. The US economy is slowing and inflation is not threatening. That makes people comfortable with the long end.’

Enter the new structured notes, labelled ‘Mini-Bond’ by Lehman Brothers and ‘Pinnacle’ by Morgan Stanley. First off, neither are bonds, even though their valuations would be affected by broadly the same factors that affect bonds, such as interest rates and credit spreads.

The two are very similar in structure. There are variations in the coupons, reflecting the credit risk that the funds are linked to.

For Lehman, the reference basket of seven corporations have at least an ‘A+’ rating by S&P. For Pinnacle, the lowest rating of ‘BBB+’ is given to Bank of China and Thailand sovereigns. The relatively lower rating would partly explain the higher coupon that Pinnacle offers.

The marketing machinery behind the two notes makes a big splash of the specific credits that the notes are linked to, creating themes that are linked to Asia or well-known institutions.

But just as important is the credit quality of the underlying assets that investors’ monies will be put into. These are derivatives or ‘synthetic collateralised debt obligations’. That sounds like a mouthful of Greek but quite a few retail products, including unit trusts and insurance-linked funds, already have CDOs as their core investment.

Pools of debt

So, what are the notes about?

Broadly, the monies are put into CDOs rated at least ‘AA’. CDOs are pools of debt sold in tranches so that as an investor, you can pick the level of risk and return you are comfortable with. Typically, CDOs can be accessed directly only by institutions. At the lowest unrated tranche, investors will immediately suffer losses if there is any default in the underlying credits. At a tranche with ‘AA’ rating, there is some cushion before the investor begins to suffer a loss of principal.

That is one source of credit risk that investors have to be mindful of. If the underlying CDO suffers default to the extent that the ‘AA’ rated tranche is hit, the note could suffer a ‘mandatory redemption’, which is likely to result in losses for investors.

On this count, structurers like Lehman and Morgan are typically unable to give details of the number of credits the underlying CDOs will have, or any scenario analysis on the number of defaults before a loss of principal is triggered.

A source at Morgan says: ‘We are unable to specify the initial collateral with much more clarity as the actual issuance (actual issuer, the names in the portfolio, the subordination levels, etc) has not been determined. We will structure/source collateral depending on the amount of orders that have been obtained during the offer period.’

The second credit risk is of course that of the reference entities – the basket of specific corporates or sovereigns – to which the investor is exposed on a ‘first-to-default’ basis. Broadly the latter means that the first ‘credit event’ to occur to any of entities would cause the notes to be unwound. A credit event would include bankruptcy, failure to pay obligations, restructuring and for sovereigns, a refusal to pay.

The coupons that the notes will pay out are linked to the coupon of the underlying CDO tranche, as well as the premium it earns from credit default swaps. What the latter means is that as an investor, you have effectively sold protection and are paid some premium for it.

So, what is the bottom line on such products?

First, be comfortable with the risk you take on. Ask as many questions as you can on various scenarios that could trigger a loss. Second, liquidity may be an issue so commit only funds that you are sure you will not need for more than five years. Third, there is little visibility on fees. On such notes, you’re often told there are no fees, but the costs are taken from the spreads.

Fourth, the notes are callable at the issuer’s discretion. Typically the note will be called when interest rates fall, and the note’s value rises. Hence, while a callable feature is typically positioned as a plus for the investor, it is in reality a negative. This is because if rates drop, you will be hard pressed to find an investment with a comparable yield.

Fifth, and not the least, always diversify. This is a complex structure for individuals so the sensible thing is not to overreach for yield.

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Ahli says 10 years ago

I bought Minibond series3 from HL, I signed Wealth Management Planner, Collective Investment Scheme Recommendations form.

My Risk Profile: Moderately conservative.

I also signed the Wealth Management Planner, Data Taker form.

Financial Objectives: My choice is High on Capital preservative: maintaining capital without the need for growth or to keep pace with inflation. Any potential growth would be a bonus.

This is my investment objective, but the RM recommended Minibond series 3.

Can I prove that I being misled?

Anyone help to comment.

Thanks

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johnson says 10 years ago

what will happen if MAS FIDreC and banks are not doing anything for the investors.singaporeans are usually can not think, can not talk and can not do.Authorities only know how to protect themselves.

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    Mr Lew says 10 years ago

    Hi,
    THe pettion to gov. was ready,pls sign at TanKinLian Blog

    Reply
FI not responsive says 10 years ago

As advised, I called the Financial Institute from which I bought the CLS. The receptionist said the Director is out until next week; and no other Financial Advisor around at the moment. She advised me to call the OCBC bank instead (OCBC does not have my records, since I did not buy directly from them, and could not advise me further).

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tham says 10 years ago

I bought MB 2 from maybank. there were several forms that was filled in. One of them says that the FA was not authorised to sell structured deposits but is authorised to sell Notes/Bonds. So what is Minibond? Structured deposits or Notes? Can someone enlighten me?

Another form says that the FA has given me info on bonds. A third form says that it ws 100% capital protected. At that time i thought i was buying bonds.
But i signed various forms including saying i understood the risks etc. Do i have a valid complaint?

thx

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a gullible says 10 years ago

Mini-Bomb is a toxic product allowed by MAS to be sold in S’pore. Now many people suffered from the toxidity of the product that could not be removed from the shelf like the tainted Chinese Diary products. Nevertheless, Chinese gov is paying for the victim, infant patients at least the medical expenses for its lacking of supervision on the food products. Why not our MAS do the similar to its people for such toxic financial product ? Is the Minibond also sold to FI ? Why it is designed only to individual retailors ?

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mewdeedi says 10 years ago

i bought from maybank, i was rated as “moderate aggressive” and was not given 7 day cooling period.

Above are the onli doc that i hv to prove being misled.

Do i have a case here anyone has any idea since i m not rated as “conservative”?

Beside tis, the RM like in most cases nvr told m abt the other risks etc etc.

My savings for my baby is down the drain. How v sad. the current govt no longer has my support. Really onli pro business, pro rich, pro foreign talents but not ordinary citizens.

The way MAS is handling the situation sucks, and so far none of the ministers have made any comments or speak on behalf of all the “victims”.

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    chris says 10 years ago

    If you think a little bit deeper….who is the major shareholder of these banks? How is it related to the govt? Who are the top mgmt sitting up there at some banks and MAS? Then, you think back to the ancient china time….and there is a chinese phrase “Guan1 Guan1 Xiang1 Hu4”. I am not too sure whether that is the case but somehow people don’t really care about the common people unless it is near election period.

    Reply
      mewdeedi says 10 years ago

      u r rite.

      i learnt my lesson, i the past, always pro govt but not now. they hv let m down big time.

      have been feeling so sad for those who lost their entire savings especially those retirees. my sympathies really for all innocent victims.

      the current govt will know where my vote goes next election!

      Reply
siammm says 10 years ago

Hi Ang,

I find very doubtful of the bank officer’s reply. I just approached the OCBC today to check any of my structured deposit being affected by LB. They assure me that all the structured deposit are principle protected by the bank (FI) unlike DBS High Note 5 which is principle protected by LB. They claimed they don’t sell minibond product… So what is what…. Is the ways to check the minibond principle protected is by FI or by LB. If is by FI, then the FI has the full responsibility to repay the investor the principle amount. I think we could no longer depend on the FI to provide us the information… I almost believe OCBC didn’t involve in this crisis until I saw your mail saying you have purchased minibond Series 3 with OCBC… are the FIs trying to protect their own reputation and say what they want???? hope more can share…

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    lioninvestor says 10 years ago

    DBS High 5 principle protected by Lehman Brothers??? Does the bank officer even know what he is saying?

    Minibond is never principle protected by anyone. The principle you get back is subjected to the number of credit defaults in the underlying securities being less than a certain number and also no early maturity due to credit default or some other events.

    OCBC Securities was one of the distributors of Minibond. So not exactly OCBC bank.

    Reply
    Ang says 10 years ago

    I got it from OCBC Securities, so I supposed OCBC is not directly involved in this Minibond.

    The problem for me and perhaps some of you as well is that we are aware that the principle is not protected and that we can lose everything. However, we were given firm assurance by the seller of the safety of the product and the REs credit standing was stated as one of the best.

    Reply
siammm says 10 years ago

How come our MAS dare not handle the case directly… but when come to taxes… the authority knows the way to tax your profit/interest/dividend directly….

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Peter Lim says 10 years ago

From today’s business time, we are seeing that MAS is trying to get into action at last. My suggestion is to look at all the documents given to you when you bought the products to find evidence of mis-representation – one for introducing a high risk product if it assessed you as moderate or low risk taker; two, what are the risk areas the relationship manager highlighted to you.

Different banks have different risk profile report. I believe some are quite water tight with caveats everywhere. This may be tricky and the only way out is to claim that you signed just as been told. There wasn’t time given to read. Also, see whether you have been given 7 day cooling off period to cancel the transaction

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    Mr Lew says 10 years ago

    Hi Peter,
    When i sign the agreement for minibond7, HongLeong gave me a
    piece of Note To Customers to sign and they state down that 7-day
    cancellation grace does not apply for this Bond.Any help for me
    Thank you

    Reply
      Peter Lim says 10 years ago

      I believe it is not mandatory for the Financial Institutions to give 7-day cooling off period for such product. Anyway it is long over since you last brought Series 7. Besides the piece of note you got from Hong Leong, you may want to check what other documents you may have. Hardcopies are the best evidence you can use against them. I have read many comments by other investors on verbal mis-representation by the FIs and I feel that it will be words against words and chances. I have come across those documents from Hong Leong on Pinnacle Notes and they are pretty water tight with caveats on almost every page.

      Reply
Tan says 10 years ago

Frequently Asked Questions
Minibond Notes
Version 1 – 23 September 2008

These FAQs have been compiled by HSBC Institutional Trust Services (Singapore) Limited (“HTSG”) for the information of holders of notes issued in Singapore under the secured note programme established by Minibond Limited.

http://www.hsbc.com.sg/1/2/miscellaneous/minibond-notes-frequently-asked-questions

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Devastated says 10 years ago

Hi Jay, which papers say that ?
I was still hopeful when i read abt Nomura buying Lehman Asia operations, so is not?

Hi Lioninvestor,
can u shed some light here?

http://sg.news.yahoo.com/ap/20080922/tbs-as-japan-lehman-nomura-83b1f84.html

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E says 10 years ago

Bros,
Not trying to offend anyone here.
Just trying to inject a voice of reason.
Think about it. Amongst all of the banks, all 9 of them.
They have earned just S$15 million dollars as they are paid 3% on the sale of minibonds.
Each of them earned about a couple of million.
Do we really think they would have sold the notes if they felt that Lehman was going to to go belly up?
Would they have gone all out to “cheat” our hard earned money?
Is it even worth their trouble?
Do they really want us to stop buying their investment products from now onwards and end their road to riches?

I feel that this is a one in a million, a TOTO kind of event that actually occurred. Would any one of us here actually think that a 160 year old name, older even than our country becoming insolvent?

We want to get our money back or at least most of it. So what if the guy that sold me the thing loses his job? I don’t really care.
What I want to know is, do i get my money back?
Likely not, as i signed all the black and white as most of you did. Will i win a lawsuit? I am not sure, unless I have hard evidence in some form. Will claiming fraud, misrepresentation achieve our goals? Hardly.
All this will lead to is even more money spent on expensive lawsuits, with no confirmation of either side winning.

I hope to offer a suggestion. We need to get to the root of the problem.

Now what is the problem?

The swap counterparty has gone bust. Instead of asking MAS to ‘punish’ the FIs, maybe MAS can ‘punish’ the 9 FIs to form some kind of SPV or JV company to act as the swap counterparty until all the minibonds in SG mature, so we can all take our risk on minibond to maturity. Think the cost to them might be the same as fighting multiple lawsuits. They could even make money!
Cost nothing on our side.

This is way better than making the lawyers rich, making both sides poorer and generally making things worse after we have lost money..

We can at least take our chances with the reference entities that we were quoted, and the underlying corporate CDOs that we were informed about. If like that in 3 years time still lose money, then i am quite resigned. At least i got my shot.

my 2 cents. No offence to anyone here.

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Kenneth says 10 years ago

Series 5 & 6 did not get their payment on 22 Sept. They have started the 15 days grace period. Series 9 & 10 will be in early Oct while followed by series 7 & 8. My series 3 is likely to be the last on 2 Dec since we just received our interest payment on 02 Sept 08.

The only hope left is the Numara taking over the minibond in Asia, or Congress approved US$700b rescue and a white knight take over the arranger role before the series default.

Again I think it is unlikely to happen while we should continue with the misrepresentation on brochure and FI sales promotion on Miniseries to be stable, low risk and no explaination on how it works + the risk involved.

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    jay says 10 years ago

    The papers said Nomura will not be honouring the liabilities of Lehman. 🙁

    Reply
jay says 10 years ago

Here what I think is the best solution out of this mess…

They should at least give the minibond investors some scurities to hold on to. For example the securities maintained by Minibond Ltd. to offset the payments. This is better than liquidating at a loss and giving the residual cash to the investors. With this scheme the instors who are patient can hold on to the securities until they mature or turn into a profit.

But this all depends if Minibond Ltd did have bonds to cover part of the liability. Or they just used the money for something else…

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Kenneth says 10 years ago

Hi LionInvestor,

On L-Minibonds.

For a Minibond series e.g. 3, what does Lehman do with the money collected? My layman thinking is maybe they use 50% to buy the bonds and 50% on securities. Upon maturity, they still will not have enough money to return to investors if the securities is much below the original price. If it is true, then the only way to survive is to use the most recent minibond series fund to pay off matured minibonds. The only way out of it is for the securities to increase significantly in order to profit. Do you think it works this way? If true, why the financial institutions are not able to under this?

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    lioninvestor says 10 years ago

    Kenneth,

    All the minibond series are kept separate from each other so it is not possible to use the money from another series to pay another.

    The money is used to buy a basket of securities. When I said securities, I do not mean normal shares.

    In most of the series, they were used to buy credit-linked notes (CLN) which are packaged together.

    For example, a CLN could contain the names of 100 corporate entities. The issuer of the note will pay an interest to the owner. As long as there is no credit default among the entities, the principal value of the note is secured. If there are say 8-10 defaults, then the principal will be affected and there could even be early termination of the particular minibond series.

    If the risk of default increases, there could also be a drop in the market valuation of the notes.

    A lot of these notes are issued by special purpose vehicles of Lehman Brothers so in a way, they are making use of minibond as an instrument to sell their CLN.

    For an overall explanation of minibond, you can refer to:

    http://www.martinlee.sg/minibonds-update/

    Reply
    lioninvestor says 10 years ago

    You might also want to read the explanation on synthetic CDOs here.

    http://en.wikipedia.org/wiki/Collateralized_debt_obligations

    Reply
Bad Dream says 10 years ago

In case anyone would like to meet our MPs, here’s the site with place, time and dates for your easy reference.

http://www.pap.org.sg/contact.shtml

Please meet tomorrow at 7pm and sign on Tan Kin Lian’s blog.

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lye says 10 years ago

Hi All,

Mr Tan Kin Lian blog has created an online petition for all
credit link securities investors(Minibond, DBS High Note, etc).

Please sign at

http://www.petitiononline.com/CLSINVES/petition.html

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nhyone says 10 years ago

Still have 15 days for a white knight to appear.

Will the Federal Reserve include Lehman Brothers into the new bailout program?

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    LSY says 10 years ago

    I am also frantically reading the ‘Today’ newspaper and watching the news praying Fed will bailout our minibond.

    It is our hard earned money and my faith in banks and banks’ products has dropped to the bottom. Never going to touch any financials pdts distributed by banks ever again.

    Reply
jay says 10 years ago

I most people only read the prostpectus properly when things go wrong. 🙁 Everything is explained (exposed) there even before the blow up.

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Tan says 10 years ago

Some update

4th Update on Lehman Minibond Notes

Please find attached a scanned copy of the Notice to the Holders of Minibond Series 5 and Minibond Series 6, by the Trustee HSBC Institutional Trust Services (S) Ltd, published on the Straits Times today (23 Sept 2008).

Occurrence of Potential Event of Default in relation to Minibond Series 5 & 6

The Trustee have been notified by the paying agent for Minibond Series 5 & 6 that payment has not been made for interest due and payable under Minibond 5 & 6 on 22 Sept 2008. As interest is due and payable under Minibond Series 5 & 6 on 22 Sept 2008, such failure to pay on this date will constitute an event of default under the respective terms of those notes in the event that the payment default continues for a period of 15 days or more.

Please be informed that an event of default under the terms of Minibond Series 5 & 6 does not itself lead to an event of default under any other note issued under the S$10,000,000,000 Secured Note Programme established by Minibond Ltd (“the Minibond Notes”)

Continuation of all other series of Minibond Notes

The Minibond Notes (apart from Minibond Series 5 & 6) will not be in default as long as Minibond Ltd is able to meet its payment obligations under such notes. Until a payment date is due and Minibond Ltd fails to fulfil its payment obligations on such due date, such notes will not be in default.

As stated in the pricing statements of the respective series of notes, Lehman Brothers Holdings Inc. is the guarantor under the swap agreement which the Issuer had entered into with Lehman Brothers Special Financing Inc. The Issuer entered into the swap agreement to enable it to meet its payment and other obligations under such notes. Under the swap agreement, the fact that Lehman Brothers Holdings Inc. has filed for bankruptcy protection in the United States gives the Issuer the right to elect to terminate the swap transactions which will in turn trigger an early redemption of the notes. In the case of such early redemption, the terms and conditions of the note provide that the underlying securities will be sold and noteholders will be paid out of the proceeds from the sale. If the swaps are not terminated, there will be no early redemption of the notes.

In the event that the Issuer defaults on its interest payment obligations in respect of any series of notes, this will trigger an event of default under the notes. However, as long as the Issuer continues to service its payment obligations, no cause of action (by the trustee or the noteholders) arises against the Issuer.

Please note that the official notice is being sent in the post by the Trustee to all registered noteholders as shown in the records of the CDP.

A Help Line Number 6216 7449 is also set up by the Trustee, HSBC Institutional Trust Services (S) Ltd for noteholders if they have any further enquiries.

For a full copy of the Notice by the Trustee, please see attached herewith of the copy of the Notice as advertised in the Straits Times today.

We will keep you updated as soon as we can get hold of any further information from the Trustee, HSBC.

Regards

Keng Loy / Lester
Debt Capital Desk
Tel: +65 6531 1603

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    jy says 10 years ago

    thank you Tan, i am a poor chinese educated housewife and hv series 6 i don’t quiet undersatnd what HSBS trustee mean can someone help to explain in simple way, MEAN MY MONEY GONE …. THANK YOU VERY MUCH

    Reply
A gullible says 10 years ago

I bot 10k of Series 2 Mini-BOMB. Though a safer try. But never realising the principle is not protected. Those bot the MB series X are cheated by the professional con-man. In the end we are paying the bill of those in US who could not fort out their housing installment. Poor S’porean still believe in this world class financial service provider ? Hope for the best with least loss. Painful waiting !!

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Ang says 10 years ago

I don’t remember doing any risk profile then. The process was very fast. I could have done such risk profiling when I signed up for iOCBC account. Even if I’m willing to take high risk, it is for high returns! In fact, I bought this for my mother who originally had the sum in FD. I transfered the money to this because it is LOW risk yet offer slightly higher interests than FD! Whatever loss there is, I’m compensating my mother who is still in the dark.

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    Chan J C says 10 years ago

    I bought via ABNAMRO. Anybody bought from them?

    Reply
      andrew says 10 years ago

      i brought from abn as well, there are risk profile but i think the r.m just filled up for me and i just signed

      Reply
        Peter Lim says 10 years ago

        You probably want to take a look at your risk rating and see where it matches the high risk of Minibonds.

        Reply
Peter Lim says 10 years ago

Please recall whether your Relationship Manager did a risk profile analysis on you prior to purchasing the Minibonds. I believe to provide evidence that you are being mis-led into buying this product, you need to refer to this analysis report. It indicates your risk profile and whether your Relationship Manager recommended the appropriate products. In my case, I scored 63 which is rated as moderately aggressive and I was recommended Minibonds which is a high risk products. Also, look at the comments too which using state what risks were highlighted to potential buyers. For me, only the referenced entities was highlighted for credit default. Nothing was mention on the Sawp Guarantor or Counter party. In addition, you must check that your Relationship Manager is qualified and authorised by the bank to sell this product. You may have a case if you can show proof that only selected risks were hightlighted

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Peter Lim says 10 years ago

You can now see the contrast actions exhibited by HKMA and MAS. HKMA organised forum for all parties involved, while MAS asked investor to approach the banks. Was it because we, in Singapore, did not take up our placards to demonstrate for actions or our MAS is simply take the route of “you investors should be responsible for your own action”. Does MAS realise that it was avoiding the responsibility of a financial watchdog?

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Ang says 10 years ago

I was given the booklet after signing up for the minibond series 3. From there, I realised i could have lost my entire sum. However, as the Reference Entities were repeatedly shown to be safe in the brochure and booklet, as well as emphasized by the product manager (of OCBC) whom I bought it from, I did not think much about it after that.

I asked the manager to give me more info, but she refered me to my broker as she “does not handle my account”. I have no official broker as I uses iOCBC. As I remember, someone was assigned as my broker for signing up this minibond. The only person whom I approached was the product manager. Now she washes her hand off!

What legitimate cause do we have that can be used to report to FiDrec since everything that was said was verbal, and I was a willing party? The only thing I can think of is that the product manager did not ask if I knew the risk, nor tell me much about the minibond. As I approached her myself telling her I saw it in the advertisement and wished to sign up, she simply told me that I made a smart decision because the product is very safe! Next moment I remembered, was myself signing the dotted line.

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Edcmund Tan says 10 years ago

I do not understand MAS comments that we need to contact Fidrec. Should MAS start a dialogue with the HSBC Trustee not asking individual investor to contact the distributor just like HK Govt ? How are we going to verify what the distributor’s service staff say after more than 1-2 years ? Does it matters now. It boils down to looking at the prospectus which is a crafty document written by lawyers. There is a clear case of misleading the public at the verge of fraud. Do you think anyone of us understand Swap Guarantee ? We are looking at the RE and their Ratings ? Investors think that it is a bond and the RE is behind the guarantee ? If you look at the prospectus, how can all this Banks allow their good reputation to be use in such scheme. HSBC, DBS, Deutsche Bank, etc; they are all indirectly contributing to mislead the investors ? Did you see Minibond address in Cayman Island c/o Deutsche Bank, this create an impression that Deutsche owned MInibond ? Please also note that there are still similar financial products out there with same issue what are MAS doing about these other Notes. Do we wait for it to fail then let the investor trying to figure it out ? MAS please be proactive and take up this issue for all of us poor investors which put in our life saving into this financial instrument.

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