SINGAPORE, Aug. 11 -- Hyflux's troubled Tuaspring water-and-power project, which ended in a collapse wiping out nearly S$900 million (RM2.97 billion) of retail investor funds, was financed through an oversubscribed preference share issue after banks refused to back its electricity-linked business model, prosecutors told a Singapore court Monday at the start of a 56-day trial of the company's former executives.

As reported by The Straits Times, Deputy Chief Prosecutor Christopher Ong said that in 2011, a consortium of banks raised "serious concerns" after learning Hyflux planned to sell electricity from Tuaspring's power plant to offset losses from water sales to the Public Utilities Board (PUB).

Hyflux had secured the tender for Singapo...