After a month of crying and pleading, there is finally hope for the investors. Two rays of hope in fact for the investors of Lehman Minibonds,
1) The Monetary Authority of Singapore (MAS) says two international financial institutions licensed to operate in Singapore have submitted proposals to restructure the Lehman minibonds notes so that they can run till maturity.
2) Hong Leong Finance is proposing to buy back Lehman Minibond Programme notes from some of its customers.
Don’t get your hope too high because Hong Leong Finance proposal comes with 2 conditions. The account holder must be at least 62 years old, with only primary school education.
I think we can safely say that Hong Leong’s proposal is due to criticisms that banks are taking advantage of their elderly and less well-educated customers. However I disagree with their proposal.
Most people who have read my blog knows that I am not for the banks returning the money when it’s hardly their fault Lehman Brothers collapse, however I have no problem if they want to buyback the minibonds. Thing is, Hong Leong need to either buy back all the minibonds, or you don’t buy back any. You cannot pick and choose who to pay back.
Of the 8,000+ investors that have sunk money into the minibonds, this ray of hope is more like a false dawn than anything else. I mean just how many of them are above 62 years old with only primary school education? What about the others investors? Nothing for them?
That I don’t agree with. Buyback all the minibonds, or don’t. You cannot pick and choose.