- Wealth PMS
Statements from ICICI:
So in September they said 100 cr (1 billion). Then in Jan they said 160 cr. plus 120 we did in September. Where did the additional 20 cr. suddenly popup from?
Still, that’s 260 cr. Now they’re saying 350 cr. already done – hello? What is this? We are being lied to – or someone is picking up numbers from the air.
Still, the real losses are more no? About 1000 cr. Where’s the remaining? Supposedly it’s “investment losses” that we shouldn’t care about. Uhm, sorry but we do care. Any “investment loss” is still a loss, and regardless of what you classify it under, you have LOST THE MONEY.
They have said, “the bank and its overseas banking subsidiaries have fixed income investments, whose marked-to-market losses are $108 million as on January 31, 2008. Of this, $101 million has been accounted for in the financial statement for the December quarter.”.
Where is this mentioned? Nothing has been specifically mentioned about this either in the conference call or in the results. Now they say it has been accounted – I don’t believe them one bit.
They also say there is some CDO exposure and then quickly say the underlying are Indian companies. CDOs are made out of a pool of loans and I don’t think they have made a pool of ONLY Indian Company loans (if this is wrong, please reveal it ICICI). Mainly because the pool will have 10s to 100s of loans bunched together. That means any CDO investment will have SOME exposure to non Indian companies, and even if you think India is God’s favourite country and no company in it will default, it leaves ICICI exposed to some potential default. The market obviously understands this and has priced it that way, hence the mark-to-market losses.
We need a far bigger disclosure. What are these mark-to-market investments, and if CDOs what are the underlying? How much is the real number, and please get this audited because I for one do not believe your figures, they seem to randomly change every few months!
This could be another Enron in the making, folks. Watch out.