SWFs still interested in financial firms?

You would think that sovereign wealth funds have had enough of U.S. financial firms. Some of them have taken a real bath. Recall that Singapore's Temasek invested $5 billion in Merrill Lynch eight months ago--only to see the company stagger and its stock plunge. But guess what? It's still investing. Portfolio says the fund invested another $900 million last month, and would like to buy even more. Meanwhile, Chinese and Korean funds were at least willing to consider a stake in troubled Lehman Brothers. We may see some more SWF take the plunge soon, now that the political furor seems to have died down. You can bet they'll be able to drive some hard bargains. Some top banks may strike them as attractive right now on a valuation basis. Current shareholders will be none too pleased if more deals are struck. But sadly they are somewhat used to the abuse.

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