April 21, 2008 / 3:16 AM / 11 years ago

Singapore's GIC says global recession, crisis likely

SINGAPORE, April 21 (Reuters) - A Singapore state investment fund that bought multi-billion dollar stakes in beleaguered banks Citigroup and UBS, said a global financial crisis and recession was increasingly likely but that its investments in western banks were long-term in nature.

“The financial contagion has now spread beyond U.S. shores, increasing the likelihood of a global financial crisis and recession,” Government of Singapore Investment Corp Deputy Chairman Tony Tan told a staff meeting on Monday.

“We could be facing a recession which is longer, deeper and wider than any recession we have encountered in the last 30 years”

“We regard our investments in UBS and Citigroup as long term investments which will give us good returns when markets stabilise and economic conditions return to more normal levels,” he said.

GIC is the larger of Singapore’s two sovereign wealth funds and bought 11 billion Swiss francs ($11 billion) worth of mandatory convertible notes in UBS last December. (Reporting by Jan Dahinten and Kevin Lim) (kevin.lim@reuters.com; +65 6403 5663; Reuters Messaging: kevin.lim.reuters.com@reuters.net) ($1=.9978 Swiss Franc)

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