This whopping understatement underlines the insecurity the S$164bn (US$108bn) fund feels about its image. "It is wrong to club everyone together as sovereign investors," said Mr Israel.

"We regard ourselves as very differentiated from other sovereign wealth funds. While we are state-owned, we are not state-directed," said Mr Israel. He was hired by Temasek from the French food company Danone last year as part of recent internationalisation.

He argued that as the majority of the fund's nine-man board are "independent" and they do not have to refer to the finance ministry - Temasek's 100 per cent shareholder - before taking investment decisions, it should be classed "a commercial company".

"Our reason to exist is purely to produce shareholder returns," he emphasised, adding that more than 40 per cent of the company's management are non-Singaporeans.

Temasek has demonstrated its ability to generate shareholder returns, which reached 27 per cent in the year to March, against 24 per cent the previous year.

These are the arguments Temasek would have used to soothe any concerns the Financial Services Authority might have had about its agreement last month to invest $5bn in Barclays to support the UK bank's bid for ABN Amro, its Dutch rival.

But as sovereign wealth funds, many from Asia and the Gulf, seek to improve their returns by investing directly in foreign companies and assets, rather than by buying debt from the US and other countries, they have inspired calls for a defensive backlash.

This intensifying protectionist reaction to sovereign wealth funds worldwide has triggered a response from Mr Israel and the rest of his fund to change its image.

Yet Temasek's attempts to distance itself from its rival sovereign wealth cousins, such as the Abu Dhabi Investment Authority and the planned China Investment Corporation, appear difficult to achieve.

He said Temasek's corporate governance is "almost the mirror of what exists on a publicly listed company". That seems to be stretching a point when five of its board members are current or former members of the Singapore state apparatus.

Suppiah Dhanabalan, its chairman, is a former foreign minister and trade minister. Lim Siong Guan, deputy chairman, is permanent secretary of the finance ministry. Goh Yew Lin, a director, chairs the Singapore Exchange's Securities Committee.

Most controversially, Ho Ching is both its chief executive and wife of Lee Hsien Loong, Singapore's prime minister and finance minister, raising serious concerns among observers about her independence from the state.

Mr Israel replied Ms Ho is only one person in the group. He pointed to her strength of character. "When you know madam Ho Ching, you realise she is her own woman and thinks for herself. Ho Ching is accountable to the board. Ultimately the board signs off on all commercial actions. As an institution, Temasek is bigger than any one person."

Temasek's stake in Barclays - historically its biggest single investment - is its 14th in the financial sector, including holdings in Standard Chartered (which it recently increased from 13 to 14 per cent) and China Construction Bank.

Mr Israel said it could help Barclays expand in Asia. "If we have an advantage, it would be that, in our part of the world, we know it pretty well and have a strong network. I think we will be help [Barclays] to leverage our experience."

It was up to the boards of Barclays and Standard Chartered to decide if a merger was in their interests: "I imagine they already know each other pretty well. We have many options available in our portfolio."

Mr Israel knows Temasek is a target for political backlash. But he said its investments will always be made for commercial reasons.

Of its troubled $3.8bn purchase of the Thai telecommunications group Shin Corp from the family of former Thai prime minister Thaksin Shinawatra last year, Mr Israel admits "politics got caught up in it" but it was "a commercial decision and nothing more".

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