Malaysia’s EPF says portfolio ended 2020 up 7.9pct at roughly $250 billion

02-Mar-2021 Intellasia | Pionline | 5:02 AM Print This Post

Malaysia’s Employees Provident Fund posted record gross investment gains in 2020, lifting the value of its portfolio to a trillion ringgit ($246.7 billion) by year’s end.

The EPF made those advances despite granting members early access to their retirement savings to help them survive the economic devastation of the coronavirus crisis.

A Saturday announcement by the national defined contribution system said it had credited a 5.2 percent dividend payout to the accounts of its 13.8 million “conventional” scheme members, down from 5.45 percent the year before. It was the lowest level since the 4.5 percent pay out for 2008, the year of the global financial crisis.

Meanwhile, the 1.12 million EPF members who switched into the EPF’s Shariah-compliant portfolio after that option was introduced four years ago were credited with a dividend payout of 4.90%.

EPF Chair Ahmad Badri Mohd Zahir, in a news release, said his team had walked “a tightrope” in 2020 “in ensuring that our members survive the difficult times while balancing their future needs.”

The news release said EPF had been “one of the first pension funds in the world to provide assistance to its members during the pandemic,” launching a programme that allowed members to draw down savings in the smaller of their two EPF accounts designed to cover the costs of a broad range of needs, including housing, education and medical services.

For that “i-iLestari” facility, 5.16 million EPF members withdrew a total of 18.1 billion ringgit during the year, the news release said.

The EPF launched a separate programme last November to give members early access to their larger accounts which are focused on retirement savings. While the news release offered no details regarding the amount of money withdrawn, an earlier announcement on January 6 said the EPF had approved 19.6 billion ringgit of withdrawals under the newer “i-Sinar” programme.

Amid sharp market volatility during the yearwith leading stock indices plunging as much as 40 percent in the first quarter followed by a quick rebound on the back of unprecedented stimulus policies by central banks and governmentsthe news release said the EPF had recorded “its highest ever gross investment income” of roughly 61 billion ringgit, up from 50.3 billion ringgit the year before.

Saturday’s new release said during the first quarter the EPF investment team “took the opportunity to rebalance its portfolio by acquiring shares that were fundamentally strong at attractive prices,” and later in the fourth quarter locked in gains by selling.

For the year, the EPF’s investment portfolio rose 7.9 percent to roughly a trillion ringgit.

Overseas exposures ended 2020 at 33 percent of the portfolio, up from 30.3 percent the year before and 26.7 percent as of the end of 2018.

By asset segment, EPF’s portfolio ended 2020 with allocations of 46 percent in fixed income, 42 percent in equities, 7 percent in money market instruments and 5 percent combined in real estate and infrastructure.

At the end of 2019, the fund had allocations of 49 percent in fixed income, 39 percent in equities, 7 percent in money market instruments and 5 percent in real estate and infrastructure. billion


Category: Malaysia

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