Two-thirds got payment offer

MORE than two-thirds of the investors in Singapore who complained of mis-selling after losing money from the collapse of US investment bank Lehman Brothers, have been offered compensation.Out of 5,350 cases dealt with by financial institutions that sold the Lehman-linked structured products, a quarter saw investors receiving full compensation, said Senior Minister Goh Chok Tong yesterday.
The latest updates came from the Monetary Authority of Singapore (MAS).
Mr Goh, who is also MAS chairman, was speaking at The Association of Banks of Singapore's (ABS) annual dinner.
He said the financial institutions that distributed the failed structured products have generally reviewed investor complaints in accordance with MAS recommendations that they should not take an overly legalistic approach.
Three banks and one finance company told MAS that as at last month, settlements worth $105 million - on a no-admission-of-liability basis - had been offered to more than 3,600 investors of Lehman-linked notes.
Of the 5,350 cases dealt with and decided on by the financial institutions, 67 per cent had seen settlements offered, while investors in 25 per cent of the cases decided were fully compensated.
Ten financial institutions sold over $660 million worth of Lehman-linked investments to more than 10,000 investors, who bought Lehman Minibonds, DBS High Notes 5 and Merrill Lynch Jubilee Series 3 LinkEarner Notes.
Mr Goh said MAS had recently consulted the public on proposed regulatory enhancements to cover the sale and marketing of structured products to retail investors.
'Broadly, the findings from MAS' policy review and investigations show that financial institutions will need fundamental changes in both business models and mindsets to win back the trust and confidence of consumers. This is true not only in Singapore, but across the globe.'


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