THE Singapore Government last night snapped up a £2.3 billion stake in Standard Chartered, the British bank with one of the biggest presences in the Far East (see Commentary, facing page).

Temasek Holdings, Singapore’s state-owned investment company, refused to rule out a bid for the bank, but claimed yesterday that it was a “very supportive and stable investor”.

The company said that it could ask for board representation, saying that it was something to discuss with the board and management of Standard Chartered, when it would be “appropriate and useful” to the company.

It is understood that Temasek told the Standard Chartered board of the deal to buy an 11.55 per cent stake in the bank shortly before the announcement. The purchase is thought to have been received positively by Standard Chartered, which regards the Singaporean group as a friendly long-term investor.

In a statement, Temasek said that it was “committed to supporting Standard Chartered’s continued growth as a unique franchise”.

It said that it believed the current Standard Chartered management team was instrumental in its success, adding that it admired their “strong capability and keen sense of business”.

Simon Israel, a board member of Temasek, told The Times: “This is a good fit with our investment portfolio and we see ourselves as being very supportive and a stable investor.”

The company has built up stakes in several banks in the region, particularly in China, where it has holdings in Bank of China and the China Construction Bank.

The Standard Chartered stake was acquired from the estate of Tan Sri Khoo Teck Puat, the late Malaysian-born billionaire, who died two years ago. Temasek will buy 152.4 million shares in the bank, which focuses on emerging markets, ending two years of speculation that the stake would be snapped up by Citigroup or JPMorgan Chase as a platform to launch a bid for Standard Chartered.

It was unclear yesterday what price the deal had been agreed at, but, based on Standard Chartered’s closing price, the stake would be worth about £2.3 billion.

The announcement of the deal came after the close of trading, when shares in Standard Chartered fell 0.5 per cent to 1,524p, valuing the company at about £20 billion. The share purchase has still to be approved by the Financial Services Authority.

Tan Sri Khoo Teck Puat helped to rescue Standard Chartered from a hostile takeover bid by Lloyds Bank in the 1980s. He held on to the stake until his death in 2004, when his family, including his daughters Jacqueline and Elizabeth, inherited it. They have long been rumoured to be willing sellers.

Elizabeth Khoo, a trustee of the estate, said yesterday in a statement: “We are confident that Temasek will be able to effectively support Standard Chartered’s continued growth. My late father would be happy as he had wanted the block to be sold to a proven long-term investor and had a high regard for Temasek.”

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