Angry Lehman investors hold public meeting in Singapore
SINGAPORE Oct 11 (Reuters) - About 600 investors in Lehman -linked derivatives held a public meeting in Singapore on Saturday to protest about the way banks sold them the investment products and to discuss ways to get compensation.
Held at Speakers' Corner, the only outdoor area in the city-state where public meetings can be held without a permit, the crowd included several people who were sold products in July, when there were already concerns about Lehman's health.
"They never told me the issuer was Lehman and I told the manager I was afraid of American banks," said Lin Ling, who bought S$60,000 ($40,900) worth of Lehman-linked "Minibonds" from a Singapore finance firm that had marketed the structured notes as a safe alternative to fixed deposits.
Public protests are rare in Singapore.
Lin said she was persuaded to buy the notes when she went to renew a fixed deposit account. She and other investors showed Reuters brochures printed by the finance company which did not say the products were structured by Lehman.
A few elderly investors broke into tears saying they had lost a large portion of their retirement savings.
"I didn't know it's Lehman. There's no Chinese explanation," said a lady in her 60s who identified herself as Madam Lee. "I don't want interest, I just want my deposit back."
Investors in Hong Kong, Singapore and Indonesia have over the past month complained the bond-like products they purchased from banks were actually complex derivatives and that they stood to lose most or all of what they had invested. [ID:nSIN245198]
Both Singapore and Hong Kong have rules that say banks must ensure that clients purchase investment products that were consistent with their needs and risk profiles.
The products included Minibonds which were sold in Hong Kong and Singapore and DBS Group's (DBSM.SI) High Notes 5 series, which would lose most of their value should anyone of eight underlying firms, including Lehman, go bankrupt.
These structured notes offered modest returns of between 4 and 6 percent per annum.
The Monetary Authority of Singapore (MAS) said about 9,700 people had bought Lehman-linked structured notes worth over S$500 million. Hong Kong authorities meanwhile said they have received more than 7,000 complaints from investors alleging banks improperly sold them Lehman-related investment products.
MAS has said that while it can impose fines and suspend the licenses of financial institutions found to be in breach of its rules, it does not have the power to order banks to compensate investors. [ID:nSIN213777]
According to Tan Kin Lian, one of the protest organisers, Saturday's gathering was to allow investors to meet and organise themselves so that they could get take collective action against the sellers or petition their Members of Parliament. (Additional reporting by Yvonne Cheong; Editing by Mathew Jones)
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