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"Value might fall but sure to come back up!"

Thursday, March 27, 2014

Banker: Why put money in FD? You put money in this bond fund can make more money. About 5% per annum.

Sis: Is this 5% guaranteed?

Banker: Banks cannot say it is guaranteed one but if you look at the history, this fund is very good and have consistent returns.

Sis: But there is administration charge...

Banker: Don't worry, you will make more money, more than the admin charge.

Sis: Then, the value of the bonds might fall...

Banker: Value might fall but sure to come back up one. Don't worry.

The banker said "banks cannot say it is guaranteed" but how many verbal guarantees had she made in that short conversation?

This was my sister's recent experience. Was there any difference between this encounter and that from a year ago? Well, the only obvious difference between this encounter and that from a year ago was the bankers' genders.

Related posts:
1. Nobody cares more about our money than we do.
2. Know what is good for us.
3. A bad experience in a local bank.


Cory said...

If is so good, the bank would rather you park your money in saving and keep quiet about it. They will then take your money to put into the investments. Why are they not doing that ? :)

AK71 said...

Hi Cory,

You mean that the bank takes the risk free 3% admin charge and let customers bear the risk of holding on to a bond fund? My goodness! -.-"

Singapore Man of Leisure said...


A "pao chiak" durian sales pitch!?


Maybe it's good that we don't assume everyone that works in a bank is a "banker".

Change the "banker" to "commission salesperson" and we are good to go!

Lelong, lelong!

hydrogenperoxide said...

You hit the right spot cory

Ernest said...

Hi AK,

Is it me or it reminds me of the minibonds saga? This also reminds me of a movie which depicted something like this "The big boys wanted to sell cause they knew something was going on. So they sold it to the retail investors to mop up the spill."

Hopefully my bowl of bak chor mee is not accurate this time round...

AK71 said...


A rose by any other name is just as sweet smelling... and will still have thorns. ;p

AK71 said...

Hi Ernest,

It could indeed be a case of 换汤不换药. -.-"

I understand how these people need to hit sales quota and all but I would like to have them do it in a responsible manner. Lay down all the cards for the prospective client and let the client make an informed decision.

However, a bond fund is really a bad idea for anyone to get into now. The responsible thing to do is not to offer this. Of course, I am assuming that the banker has sufficient knowledge to know that bond funds are a bad idea.

Why do I get the feeling that I am making the banker look worse with each word I type? -.-"

SnOOpy168 said...

In the name of that flavor of the month incentives, these well dressed flowerpots & dudes just prey on the unsuspecting. My elder father was sold a package like this that locks in for 10 years. By the time I discovered this, it was too late (pass the free look policy). Now that he is gone, I am still unable to release that fund without heavy penalties. May the comms earned by that heartless banker be used as 白金 for his/her own.

AK71 said...

Hi SnOOpy168,

I am sorry to hear about your father. :(

Indeed, at the very least, these bankers should make an effort to recommend appropriate products but, like I wondered, do they even have the knowledge to do this?

Unknown said...

I have friends whom use to work for banks and quited because they felt that they are selling investment products just to meet quota but may not be in the clients best interest or even in their interest at all. Is omitting info misrepresentation or it's up to us to ask the right questions? Frankly I think financial knowledge is power and I will use to test whether the "banker" is working in my best interest or not.:p

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