SME Talent Programme (STP) – S’pore

The SME Talent Programme (STP) helps local SMEs (small and medium enterprises) attract talent from the Institute of Technical Education (ITE), Polytechnics and Universities, through structured and meaningful internships.

SPRING will partner appointed Approved-in-Principle (AIP) partners as key managing agents of the programme, assisting participating SMEs across industries to engage the students through local Institutes of Higher Learning (IHLs).

(1) SMEs’ Eligibility Criteria

  • At least 30% local shareholding
  • Group annual turnover of not more than S$100 million OR group employment size of not more than 200 workers
  • Offer career opportunities with a clear job description and career progression path
  • Possess sound Human Resource processes
  • Willing to participate in SPRING’s Human Resource Maturity Diagnostics (HRMD)

(2) Students’ Eligibility Criteria

  • A Singaporean or a Singapore Permanent Resident who is a full-time student in an ITE, Polytechnic or University
  • Keen interest to gain hands-on experience/start careers in local SMEs

(1) For SMEs

SMEs can offer internship opportunities to local students from ITE, Polytechnics and Universities by:

  • Providing a structured and meaningful internship experience
  • Offering interns a monthly internship stipend that meets the STP requirements ($1,000 for university students; $800 for Polytechnic and ITE students)

SMEs are eligible for up to 70% funding support covering the internship stipend:

  • Minimum $800 monthly allowance for ITE and Polytechnic students
  • Minimum $1000 monthly allowance for University students

SME Talent Programme (STP) at a Glance. (updated 12 Feb 2018). SPRING Singapore.

Notes/Related post:

SPRING = SPRING (Standards, Productivity and Innovation Board) Singapore. See Jane Wee. (2001). SPRING Singapore. NLB Singapore Infopedia.

The programme began in 2013. [The STP will decrease, and be stopped for sectors/job roles under the SkillsFuture Earn and Learn Programme (ELP).] (13 Apr 2015). TODAY.

Earlier post on Republic Polytechnic internship (FAQ).


避開3地雷 小薪水3年存百萬 (SGD) $44k – Smart Mag – One

Save Singapore Dollar (SGD) $44k* in 3 years despite a low salary; this Taiwanese header caught my eye. [But perhaps too optimistic?]

It reminded me of Joshua Sheats (Episode 163, Radical Personal Finance and his thoughts on savings rates).

The $44k sum stems (greatly but not solely) from:

  • good house buying practices
  • efficient insurance practices
  • wise investment

I shall touch on insurance here. There were 2 examples given. One a negative demonstration with 16% of income going to insurance. The positive role model spent a mere 2.95% – amazing!

But this takes alot of work. The positive case study centred on a family of 4. The vast majority of their policies are term insurance. [See post from Monetary Authority of Singapore’s MoneySENSE] The husband of the family would frequently review those policies as such. 4 of their term policies have yearly/annual durations. They have 13 in total. Only 1 is for life (wife).

A general rule offered by the recommended Taiwanese financial planner is: the sum assured should be 10 times the yearly income, while the insurance premiums should be 10% or less of one’s yearly income. (p.129)

Some interesting points from the negative example (again Taiwanese context). They bought cancer insurance and surgery insurance. The latter was for life. But the magazine opined that surgery in old age was not always advisable. Hence, such premiums was cost inefficient, and of much less use in old age.


* approximately

The sum is based on Taiwan New Dollar/New Taiwan Dollar to Singapore Dollar exchange rate, accessed this week.

避開3地雷 小薪水3年存百萬. (Oct 2016). Volume 218. Smart Magazine. Business Weekly, division of Cite Publishing Ltd. [Smart = 智富 = Smart Wealth. It sounds the same as 致智 = result in wealth] – I borrowed the hardcopy from one NLB branch, Singapore.

[Linked through Joshua Sheats] The Shockingly Simple Math Behind Early Retirement. (13 Jan 2012). Mr. Money Mustache.]

Deconflicting an REIT Term – Gearing

[Note – this post in written mainly in relation to the Singaporean financial scene. Your country’s system may differ.]

I had a tough time because I chanced upon Dr Wealth’s (formerly BigFatPurse) entry, REITS Glossary: Essential Terms All REITs Investors Must Know (3 Nov 2016).

It lists TWO ways to calculate gearing:

  1. Gearing (Debt-to-Equity Ratio) = Total Debt ÷ Total Equity
  2. Gearing (Debt Ratio) = Total Debt ÷ Total Assets

Thus I sought quite a few places, without success I must add, to verify which formula one S-REIT (Singapore REIT) used in their Annual Report… I attempted calculations based on the documents but did not arrive at full accuracy.

The (rather readable) volume, International REITs: how to invest overseas and build an international portfolio / Kaiwen Leong, Wenyou Tan and Elaine Leong. Singapore. (2014), uses Borrowings from the Non-Current Liabilities section of the sample/fictional Balance Sheet (p.48-50) as Total Debt.  It excludes Payables & Accruals and Long-Term Liabilities.

Well, it seems an answer is found. No. 2 is the yardstick formula. This is based on further cross referencing:

Some differences… but a closure at least – for now.


NAIRU – Economics concept

Interpretation/notes from Economics Demystified, p.59.

The Non-accelerating inflation rate of unemployment (NAIRU): “the specific level of unemployment … in an economy that does not cause inflation” to increase (Non-Accelerating Inflation Rate Of Unemployment – NAIRU. No date. Investopedia.)

However, according to Thornton’s book there is no stable/fixed relationship (recall stagflation?) between unemployment and inflation (even though Kiwi economist William Phillips had first suggested an inverse relationship).


Analysis – Brokers’ Take – 1 Jul 2017


The online version of this news section is shorter slightly shorter than the print version. With the revamped new freesheet – thenewpaper (tnp), this section has an archive of 136 issues (latest: 7 Jul 2017). This was also compiled by Cai Haoxiang, who I believe works for The Business Times (email: The first issue on tnp was “Compiled by Kenneth Lim, The Business Times” – dated 6 Dec 2016.

Their disclaimer [I have put some words in bold type.] – All analyses, recommendations and other information herein are published for general information. Readers should not rely solely on the information published and should seek independent financial advice prior to making any investment decision. The publisher accepts no liability for any loss whatsoever arising from any use of the information published herein.

Focus/Breakdown (with comments in brackets and in bold/italicised):

Keppel REIT (Buy recommendation) – office space REIT

It ended trading at $1.145 per unit (interesting… 3 decimal digits). The forecasted price was $1.23 (Target Price).

  • The REIT is taking a 50% stake (seller recorded as Australian Post) ‘in a premium office tower’ to be built in Australia at 311 Spencer Street, Melbourne.
  • Favourable view towards medium term (how long is this duration?) a distribution per unit (DPU) uptick owing to 30 year lease and (I infer contractually) inherent rental escalations (But what of the Australian taxes?)
  • Predicted immediate/short term DPU ‘dilution’ (decline in unit prices?) and gearing (leveraging) forecasted to rise to 40% which would result in investor ‘pushback’ (what does this mean?)
  • This is surmounted by “…capital values in Singapore should remain steady on the back of recent market transactions and strong interest from investors looking to buy office buildings in Singapore.” (What does ‘capital values’ mean?)
  • Target Price is dependent on Keppel REIT’s Q2 2017 figures
  • The REIT has a 0.8 price to book ratio which to the “brokers” was “attractive”

Financing/Payments: resale HDB flat

This research is accurate as at 19 May 2017 (see also the respective dates of the sources). It relates to the Singapore context. (Singapore is an island city-state at the tip of peninsular Malaysia in Southeast Asia).

The list of costs is bewildering. To bring things to life, I shall focus on a hypothetical example from guides: Everything to know about paying for a resale flat. (20 Sep 2016) by Zareen B. You may also refer to the site for the example of the bank loan model purchase. [For accuracy, I shall indicate cross references as far as possible.]

The case study focuses on a young married couple with total monthly income of $6k (where $1k = $1000). They hold $20k in their CPF accounts; possessing access to a $30k Family Grant. Valuation of their desired 3 room HDB resale equaled the sale price ($400k) therefore no (additional) COV (Cash-over-valuation)^ is needed for payment. The approved HDB Loan would limit its financing to 90% of the purchase price under a 25 year timeframe.

Grant of Option/Booking fee [cash] – $1k

Valuation fee [credit card] – $199.25 (lower price for 1/2 room flats – see Costs and Fees: Resale from HDB, updated 23 Aug 2016.)

Deposit [cash] – $4k (Grant of Option and Deposit total not more than $5k)

Resale application administrative fee [credit card] – $80 (lower price for 1 or 2 room flats – see Costs and Fees: Resale from HDB, updated 23 Aug 2016.)

Initial Payment [CPF] – $40k (10% of purchase price; first payment is higher for bank loan financed purchase)

Stamp duty on option [Cash/CPF] – $6.6k [See Inland Revenue Authority of Singapore (IRAS). Buyer’s Stamp Duty (BSD), updated 18 May 2015.]

Stamp duty on mortgage [Cash/CPF] – $500 [See IRAS. Mortgage Duty, updated 3 Jul 2015.]

Conveyancing fees [Cash/CPF] – $1,009.01

Lease in-escrow registration fees [Cash/CPF] – $38.30

Mortgage in-escrow registration fees [Cash/CPF] – $38.30

Caveat registration fees [Cash/CPF] – $128.90

Title search fees [Cash/CPF] – $10.40

Home protection scheme [Cash/CPF] – $241.56 (annual)

Fire Insurance [Cheque] – $4.50

Balance of purchase price [Loan/CPF/Cash] – $355,000

Total – $408,850.22

Post deduction (of Family Grant + HDB Loan + CPF), the couple still has to fork out $3,850.22 in cash.

Further sites for research/reference:

Buying a home. (7 Dec 2016). MoneySENSE. Monetary Authority of Singapore.

Ability to Pay. (no date). Housing Development Board. Singapore. Having a home property according to the HDB would among other things, entail monthly bills for:

  • Cash payments for housing loan instalments
  • Service & Conservancy Charges
  • Utilities and services bills
  • Insurance premiums

Adam R. (4 May 2016). 3 questions to ask when buying resale HDB for the first time. 99 Pte Ltd.

[The site lists 9 steps]. Resale HDB flats: How to buy. (27 Jan 2016). Government of Singapore.

Channelnews Asia. COVs fall to zero for first time since 2006: SRX. (6 Mar 2014). TODAY.

^Ong Hwee Hwee. (10 Mar 2014). Singapore Budget 2014: 5 things about cash-over-valuation or COV. The Straits Times.


REITs Reflections – News – Jan 2017

It was my first hardcopy Business Times Weekend (Singapore) for a long while. (There was a 20% price increase but the paper quality has improved… This helps if you are a collector.)

I did not go knocking for REIT (Real Estate Investment Trust) news but two came in this issue (21-22 Jan 2017).

After the earlier research, these articles become clearer to me or at least I seem to be able to look at ‘key’ items. Only time will tell whether this amounts to true wisdom.

Note – all monetary figures are in Singapore Dollars.

CMT’s rental reversion keeps sliding – Kalpana Rashiwala

CMT = CapitaLand Mall Trust, the REIT with the longest history in S-REITs (Singapore REITs)

Rental Reversion percentage (%): rise of existing rental charges in comparison to rates the year before (not counting recently developed and remodeled units) – the rates are usually agreed upon 3 years earlier. [A two column table is used to depict the (general) downtrend.]

FY (Financial Year) 2007, it was 13.5%. It has remained below 9.7% from FY 2008 to FY 2016. Its two troughs were in FY 2009 at 2.3%, and FY 2016 at 1%. It had stayed above 6% from FY 2010-14.

Structurally, new retail outlets had been popping up to contest their catchment areas. On pure instinct (more analysis is required therefore), it seems the management made the right move to sell off Westgate Tower ($17.1 million kept for ‘general corporate and working capital purposes’) and Rivervale Mall (in 2015 with a $72 million profit, out of the $116 million price, after fees and expenses – See 15 Oct 2015 Channelnews Asia article). Funan, near City Hall MRT station, is being refurbished. 97% of CMT’s debt comes with fixed interest rates. [Hence interest rate hikes may be less threatening, depending on whether CMT is re-financing within a higher interest rate environment. The overarching environment: ‘Singapore’s interest rates are expected to rise in tandem with US rates, which will increase the borrowing costs for Reits here.’ See TODAY article, 31 Jan 2017.] The joint ventures at Raffles City and Westgate mall are not.

Gauging FY 2016 against FY 2015, Gross revenue grew 3.1%, so did NPI (Net Property Income) at 2.9%, Distributable income gained 0.6%. ‘On a comparable mall basis’, gross revenue grew 0.4% and NPI stagnated [which malls were ‘comparable’ was not explained in detail.] It was not stated if the distributions were in units or in cash; or what ratio of both.

The author suggests that the renewal of leases [51.4%/Net Lettable Area (NLA) – Bedok Mall, 35.8% – Westgate, and 30.6% Lot One Shoppers’ Mall] would allow CMT the chance to change tenant compositions. This conceivably could be used to establish different niches/marketing points or invite more profitable tenants in.

Another point that needs research: ‘counter’ or trading price versus ‘Adjusted Net Asset Value per unit (excluding distributable income)’. The former was on 20 Jan 2017 was $1.985; the latter – $1.86 on 31 Dec 2016 (equal to 31 Dec 2015). I wonder what is the value of knowing the latter value…

* Refer to this post on CMT for more details.

FCT posts 0.7% rise in DPU for 1st quarter – Lynette Khoo

FCT = Frasers Centrepoint Trust (a comparable REIT? – Bedok Mall and Bedok Point are practically side by side… Hmmm the Replacement Cost Approach?)


NPI for 1st fiscal quarter ending 31 Dec 2016 fell 6.4%: Causeway Point (CP), Bedok Point, and YewTee Point could not make up for income declines from Northpoint (asset enhancement expected to end in Sep 2017; note that Northpoint includes the Yishun 10 Retail Podium), Changi City Point and Anchorpoint. (REITs have different fiscal quarters it appears… Ascendas-REIT: First Quarter Ended 30 June 2016). In that quarter, CP took up 52.8% of the NPI; with second and third being Northpoint and Changi City Point. Similarly, CP constituted 52% of the NLA in the period. NPI FY 2014 = $118, 096, 000 while NPI FY 2015 = $131, 043, 000 – in other words, (rounded up) 11% expansion. [p2, FCT 4Q15 Distribution per Unit up 2.7% year-on-year].

Prior to 31 Mar 2016, FCT’s property manager accepted 20% of its fees by way of REIT units. This has been jacked up to 70% till 31 Dec 2017 in a bid to prop up the Distribution Per Unit (DPU). Including FY 2007 to FY 2016, DPU has been on a constant uptrend.

  • FY 07 > 6 cents
  • FY 08 & 09 > 7 cents
  • FY 10 & 11 > 8 cents
  • FY 12 & 13 > 10 cents
  • FY 14, 15, 16 > 11 but below 11.8 cents

The presented compound annual growth rate was 6.9%. [How much does this exceed inflation though?] Going back earlier, FCT’s 2016 Annual Report cited Bloomberg on p. 5. The latter stated that FCT’s DPU yield was 5.34% (exceeding Singapore’s Government 10-year bond yield of 1.758% by 358 basis points).

Its 91.3% occupancy is lower than CMT’s at 98.5% (period ending 31 Dec 2016). 74% of NLA are up for rent by 30 Sep 2017 (end of 2017 fiscal year). According to FCT’s press release <FCT 4Q15 Distribution per Unit up 2.7% year-on-year>, PDF dated 22 Oct 2015, FY 2015 occupancy was 96%. Annual mean rental reversion was 6.3%.

Since Chew Tuan Chiong, CEO Frasers Centrepoint Asset Management Ltd (FCT manager), referred to low gearing at 29.7%, I did further study. This detail is consistent with <Frasers Centrepoint Trust: Investor Presentation>, (Feb 2017) – a 56 page PDF document. Historically, gearing (‘Calculated as the ratio of total outstanding borrowings over total assets as at stated balance sheet date’) peaked at 31.3%, FY 2011 (ending 30 Sep 2011). Only in one year between 2007 and 31 Dec 2016 did it go below 28%; it exceeded 30% in 3 of the years in the said period. In FY 2015, roughly 75% of its borrowings were ‘on fixed interest rates or … hedged via interest rate swaps.’ [p1, FCT 4Q15 Distribution per Unit up 2.7% year-on-year] Interest Cover (‘Calculated as earnings before interest and tax (EBIT) divided by interest expense for the quarter…’) was 7 times for period ending 31 Dec 2016 and FY 2016. [It would be important to see past Interest Coverage nevertheless.] But we see that its All-in average cost of borrowings was 2.1% in FY 2016 and 2.4% in FY 2015.

Counter/trading price of FCT units was $1.965 on 20 Jan 2017.

Finally, a comparison of strategies (?):

FCT (22 Oct 2015) – ‘FCT is focused on increasing shareholder value by pursuing organic, enhancement and acquisition growth strategies.’ (above mentioned press release)

CMT (above mentioned Business Times article) – CEO CapitaLand Mall Trust Management Limited CEO, Wilson Tan, highlighted ‘asset enhancement’, ‘capital/debt management’, and ‘operational efficiency’ as channels to ‘stabilise CMT’.