Aug. 22 (Bloomberg) -- Temasek Holdings Pte raised its stake in Standard Chartered Plc, a U.K. bank that makes most of its profit in Asia, as the region's economy expands faster than the U.S. or Europe.
Temasek, a Singapore state-owned investment company that manages the equivalent of $107 billion, increased its interest to 15 percent from 14 percent, Standard Chartered said in a statement yesterday. The stake is valued at about 216.2 million pounds ($428 million), based on the bank's market capitalization as of yesterday's close.
``We have increased our stake in what we have always considered to be a good investment, the reason we went in, in the first place,'' Myrna Thomas, Temasek's spokeswoman, said in an e-mailed statement today.
Temasek's move underscores the increasing appetite of so- called sovereign wealth funds, which control an estimated $2.5 trillion, more than all the world's hedge funds combined. Stephen Jen, London-based global head of currency research at Morgan Stanley, estimates the funds, which invest currency reserves in foreign assets and other investments, may expand to $12 trillion by 2015.
Temasek and state-owned China Development Bank will contribute about $11.2 billion in U.K. lender Barclays Plc's revised bid for ABN Amro Holdings NV in the largest financial- services takeover.
Single-Largest Shareholder
Temasek, which raised its stake in Standard Chartered to 14 percent from 13 percent last month, is the bank's single-largest shareholder. The investment company bought 12 percent of the lender in March 2006 from the estate of late Singapore hotelier Khoo Teck Puat for 2.3 billion pounds.
Standard Chartered said on Aug. 7 that first-half profit rose 26 percent to $1.37 billion on gains in India, China and the Middle East.
The stock has risen 3.3 percent this year, making it the best-performing U.K. bank, ahead of the nine-member FTSE All- Share Banks Index, which has lost 9.8 percent. The lender is also the third-fastest growing bank in the U.K. in the past year, in terms of sales, according to Bloomberg data.
Emerging economies in Asia are estimated to expand as much as 9.6 percent this year, the International Monetary Fund said in July. The U.S. may grow 2 percent and the U.K 2.9 percent.
Standard Chartered shares fell 12 percent from Aug. 14 to Aug. 16, posting their biggest three-day loss since September 2001, on concerns that a global credit crunch stemming from U.S. subprime loans will hurt earnings.
Temasek, run by 54-year-old Chief Executive Officer Ho Ching, said financial services swelled to 38 percent of total assets in the year to March from 35 percent a year earlier. The company owns shares in ICICI Bank Ltd., India's second-biggest lender by assets, and financial-services companies in Indonesia, Singapore, South Korea and Pakistan.
