Templeton's Mobius Says Credit Crisis Is Near End

April 17 (Bloomberg) -- Templeton Asset Management Ltd.'s Mark Mobius said the credit-market crisis that's caused $245 billion of losses at banks and brokerages is ``near the end.''

The fund manager, who oversees $47 billion in emerging- market equities, said he has been buying shares of banks including Bank of China Ltd. and Industrial & Commercial Bank of China Ltd. Malaysian equities are also becoming ``more and more attractive,'' he said in a Bloomberg Television interview today.

The MSCI World Index has gained 8.4 percent since closing at a 17-month low on March 17 after JPMorgan Chase & Co. rescued Bear Stearns Cos. and the Federal Reserve cut rates to shore up confidence in the financial system. Mobius joins the chief executives of JPMorgan, Lehman Brothers Holdings Inc., Morgan Stanley and Goldman Sachs Group Inc. in predicting that the worst of the credit crisis has passed.

``Most of the bad news is already in the market,'' Mobius, 71, said. ``The writedowns are coming in fast and furious.''

Energy stocks are his biggest investment because of rising oil prices, he said. He also added shares of Sweden's Oriflame Cosmetics SA to his holdings recently.

His $376 million Templeton Emerging Markets Fund gained 15 percent in the 12 months through yesterday, compared with a 19 percent advance by the MSCI Emerging Markets Index.

Shares of Bank of China, the country's third-biggest bank, fell as much as 22 percent this year in Hong Kong and are valued at 11.9 times estimated earnings. That's lower than the MSCI Emerging Markets Financial Index's 12.6 times. Industrial & Commercial Bank, the nation's biggest lender, dropped as much as 21 percent in 2008 in Hong Kong.

Largest Holdings

``We've been adding in the banking sector generally,'' Mobius said. ``Prices have come down to more reasonable levels.''

Shares of companies tied to banking and finance have suffered this year as credit-related losses mounted. The MSCI Emerging Market Financial Index has slumped 12 percent in that time, the second-worst performance of 10 industry groups. The gauge added 0.8 percent today, its third consecutive advance.

Helping to ease concerns, Jamie Dimon, JPMorgan's chief executive, said yesterday that the credit crisis is ``maybe 75 percent to 80 percent'' over. Goldman Sachs's CEO Lloyd Blankfein told investors last week that ``we're closer to the end than the beginning.''

Malaysia's Kuala Lumpur Composite Index on March 10 plunged 9.5 percent after the government suffered its worst election result in almost 50 years. The gauge has lost 13 percent in 2008.

`Good Impact'

Prime Minister Abdullah Ahmad Badawi last month vowed to proceed with infrastructure projects to promote growth and pledged measures to help the poor, seeking to reassure investors after the government's narrow poll victory.

Malaysian stocks are ``becoming more and more attractive as a result of these political changes,'' Mobius said. ``There has been re-awakening so to speak, reassessing that Malaysia should be doing well and prosper. I think that's good news and that could have good impact on the market.''

Petroleo Brasileiro SA, Brazil's state-controlled oil company, and PetroChina Co., China's largest oil producer, were respectively the biggest and third-biggest holdings in Mobius's emerging market fund as of the end of 2007.

Crude oil futures advanced 1 percent to $114.93 a barrel in New York yesterday, a record close. Futures were recently at $114.90. Barclays Capital and Merrill Lynch & Co. last month raised their U.S. crude-oil price forecasts for 2008 above $100 a barrel.

``Energy is by far the largest weighting in our portfolio,'' Mobius said. ``We don't see any reason to change that any time soon.''

The fund manager said he bought shares of Oriflame, which sells natural makeup in more than 50 countries, to benefit from rising consumer spending in Russia.

Shares of the company gained 68 percent in the 12 months through yesterday. The company raised its annual sales forecast this month after first-quarter revenue exceeded managers' expectations on new products and Easter's timing.