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Ins & Outs of Temasek

Temasek’s sources of funds come mainly from what we do as an investor and shareholder.

The visual guide below explains Temasek’s sources of funds and how they may benefit you, businesses or the community at large

A visual guide to our sources of funds and their use.

Icon Divestments

We receive proceeds from sale of our assets whenever we rebalance our portfolio.

Our annual divestments averaged about S$22 billion over the last five years.

Icon Dividends from Portfolio

We receive dividends from our portfolio companies.

Our annual dividends averaged S$8 billion in the last five years.

Icon Distribution from Funds

Our investments in funds distribute their returns to us when they start maturing.

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Icon Temasek Bonds

We borrow directly from bond investors through our US$20 billion Guaranteed Global Medium Term Note Programme and S$5 billion Guaranteed Medium Term Note Programme.

As at 31 March 2019, we had 16 Temasek Bonds totalling some S$13.8 billion with a weighted average maturity of over 10 years.

Temasek Bonds are rated Aaa/AAA by Moody’s Investors Service and S&P Global Ratings respectively.

Icon Temasek Euro-commercial Paper (ECP)

We borrow short term money by issuing ECP, with maturities typically below a year.

As at 31 March 2019, our S$1.3 billion of ECP had a weighted average maturity of above two months.

Icon Bank Borrowings

We may also borrow from banks from time to time, especially for short term funding or bridging needs.

Icon New Capital from Shareholder

Our shareholder, the Minister for Finance, may inject fresh capital or assets into Temasek.

This includes the initial S$354 million portfolio of 35 companies to form Temasek in 1974.

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Our funds come mainly from our own portfolio.
Temasek mixing pot

A visual guide to our sources of funds and their use.

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  • Icon Divestments

    We receive proceeds from sale of our assets whenever we rebalance our portfolio.

    Our annual divestments averaged about S$18 billion over the last five years.

  • Icon Dividends from Portfolio

    We receive dividends from our portfolio companies.

    Our annual dividends averaged S$8 billion in the last five years.

  • Icon Distribution from Funds

    Our investments in funds distribute their returns to us when they start maturing.

  • Icon Temasek Bonds

    We borrow directly from bond investors through our US$15 billion Global Medium Term Note Programme.

    As at 31 March 2018, we had 14 Temasek Bonds totalling some S$11.4 billion with a weighted average maturity of over 11 years.

    Temasek Bonds are rated AAA/Aaa by S&P Global Ratings and Moody’s Investors Service respectively.

  • Icon Temasek Euro-commercial Paper (ECP)

    We borrow short term money by issuing ECP, with maturities typically below a year.

    As at 31 March 2018, our S$1.4 billion of ECP had a weighted average maturity of about two months.

  • Icon Bank Borrowings

    We may also borrow from banks from time to time, especially for short term funding or bridging needs.

  • Icon New Capital from Shareholder

    Our shareholder, the Minister for Finance, may inject fresh capital or assets into Temasek.

    This includes the initial S$354 million portfolio of 35 companies to form Temasek in 1974.

    Our funds come mainly from our own portfolio.

Temasek mixing pot
Our funds come mainly from our own portfolio.

Investments and Associated Costs

We invest in companies with outstanding management, sound governance, and competitive products and services, to deliver a better, smarter and more sustainable world.

Dividends to Shareholder

We pay dividends to our shareholder. This financial discipline is directed by the Temasek Board.

From 2000 to 2015, Temasek was under the Government NII spending framework, where up to 50% of our dividends could be used by the Singapore Government for budget spending. The remaining dividends were locked up as past reserves of the Singapore Government.

Taxes

Temasek pays local taxes on its earnings in various countries.

Taxes paid to the Singapore Government help to fund spending for public services like defence, education, healthcare and social services.

Payment to Temasek Bondholders and ECP Holders

We pay our investors interest payments and the principal amount of our Temasek Bonds and ECP.

Endowments for Communities

We have 19 non-profit philanthropic endowments, gifted over the years, to focus on different aspects of building people, building communities, building capabilities and rebuilding lives.

To date, their programmes touched over 900,000 lives across Singapore and Asia.

Staff Volunteers

Our staff volunteers come together via their T-Touch initiative to make a difference in the community.

They volunteer ideas, time and money to support their chosen charities within their communities.

NIR Contributions to Singapore Government Budget

MAS and GIC have been part of the NIR framework since 2009, while Temasek was included in 2016.

Since Temasek’s inclusion, the Singapore Government may spend up to 50% of Temasek’s expected long term returns, net of inflation. These are projected and unrealised returns based on the current portfolio mix.

NIR Contribution is the largest contributor to Singapore Government revenues, at 19% of the 2019 Government Budget. Corporate and Personal Income taxes, and the Goods and Services Tax are the next three largest contributors.

The Singapore Government budget funds the Pioneer Generation Package and Merdeka Generation Package, alongside other long term initiatives that will help to enhance Singapore’s education, healthcare, transport and social support systems.

NIR is not an outflow for Temasek

This NIR framework does not require Temasek to pay more dividends, or sell any assets.

We do not manage:

  • Singapore CPF savings
  • Singapore Government reserves
  • Singapore foreign reserves