Oei 'happy' with Citigroup settlement

Oei, ranked Singapore's 33rd richest person by Forbes magazine this year, sued Citigroup in May, alleging he incurred the losses after the bank provided him with conflicting reports of his margin surplus in October last year, forcing him to unwind his trades at “an adverse time.” He declined to discuss settlement terms.

“I am quite happy with the outcome and I've put this 100 percent behind me,” Oei said in a telephone interview from Singapore Friday. “How do you say in it English? Water under the bridge. It's all been quite amicable and I have no hard feelings.”

Oei, 61, told Singapore's Straits Times newspaper in May that he lost about S$1 billion, which he had paid up in full. He had claimed Citigroup failed to execute orders for US$600 million of U.S. 30-year treasury bonds in November that were placed to covered call options he had written. Call options give the buyers the right to buy securities at a pre-agreed price on or before a specified date.

Citigroup said in a statement late Thursday it had reached a settlement with Oei, adding that the terms were confidential.

“There have been reports that I've closed my Citi account, but that's not true,” Oei said. “I'll certainly continue my business with them.”

Other banks including UBS AG and DBS Group Holdings have been sued by Asian clients this year over investment losses after financial markets tumbled during the global credit crisis.

“Understandably banks prefer settling with important customers in order to maintain relationships,” said Richard Chalk, head of Freshfields Bruckhaus Deringer LLP's Asian disputes practice. Chalk said his firm, which wasn't involved in the Oei case, has acted for Citigroup before.

In July, a Hong Kong citizen sued UBS, alleging negligence and reckless misinterpretation in inducing her to buy so-called accumulators that resulted in losses of more than HK$200 million (US$25.8 million).

Also in July, 204 investors in Singapore sued DBS Group Holdings over S$17 million in losses on securities linked to the collapsed Lehman Brothers Holdings Inc. The Monetary Authority of Singapore banned DBS and nine other financial institutions that sold products linked to Lehman from selling structured notes for a minimum of six months to two years.

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