Singapore’s Temasek is looking into a $275 million loss that was caused by foreign exchange (FTX).

Asian Trade TVNovember 30, 2022

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Lawrence Wong, Singapore’s Deputy Prime Minister, said on Wednesday that Temasek Holdings has started an internal review of its investment in the now-defunct FTX crypto exchange, which led to a $275 million write-down.

Wong, who is also the finance minister, said that the loss did not mean that the governance system of state investor Temasek was not working and that “no amount of due diligence and monitoring can eliminate all the risks.”

But Singapore’s next leader-to-be told parliament that the loss was “disappointing” and that it hurt Temasek’s reputation.

Related: Temasek of Singapore writes off a $275 million FTX investment.

“The fact that BlackRock (NYSE: BLK) and Sequoia Capital have also invested in FTX does not change this,” said Wong.

After investing about $275 million in FTX, Temasek decided to write down the investment after the exchange went down in a spectacular way.

Wong said that the review will be done by an internal team that is independent and will report directly to the board. The team will not include the people who made the investment.

Temasek said that its investment in FTX cost 0.09% of the net value of its portfolio, which was S$403 billion ($293.97 billion) as of March 31, 2022, and that it has no direct exposure to cryptocurrencies at the moment.

Temasek said that it did “extensive due diligence” on FTX from February to October 2021 and that the company’s audited financial statements showed that it was profitable.

Wong told lawmakers that Singapore’s reserves, which are tied to long-term returns, were not affected by the loss of a single person.

SoftBank Group Corp.’s Vision Fund and Sequoia Capital, two other backers of FTX, have also written down their investments to zero. This is because FTX, which was started by Sam Bankman-Fried, filed for bankruptcy in the US this month. This is the most high-profile crypto blowup to date.