The Employees Provident Fund (EPF, a.k.a. Kumpulan Wang Simpanan Pekerja, KWSP) Board, with the approval of the Minister of Finance, has just announced a dividend rate of 6.75% and RM39.08 billion gross investment income for financial year ended 31 December 2014, which is an increase of 11.66% compared with RM35.00 billion in 2013.
The 6.75% dividend amounted to a total payout of RM36.66 billion where RM5.41 billion was required to pay every one per cent of dividend rate for 2014. This was 10.53% higher compared with RM4.91 billion paid for every one per cent dividend rate for 2013, in tandem with the rise in contributors’ savings.
EPF global investments, forming 23% of total assets, had contributed 33% towards their total income for 2014.
The 2014 gross investment income was mainly driven by Equities in the domestic and global markets covering both emerging and developed countries. The asset class recorded an investment income of RM22.91 billion in 2014, up 17.37% compared with RM19.52 billion in 2013, and contributed 58.63% to the total gross investment income in 2014. Almost half of the income of the equity investment is derived from EPF’s global portfolios.
Majority of the EPF’s investment assets were placed in low risk fixed income instruments as this asset class provided a stable stream of income in the long run.
Majority of the EPF’s investment assets were placed in low risk fixed income instruments as this asset class provided a stable stream of income in the long run.
Loans and Bonds contributed RM7.57 billion in income, compared with RM7.51 billion in 2013. This rise was attributed to the performance of the global portfolios by both internal and external fund managers. Malaysian Government Securities and Equivalents recorded RM6.59 billion in income, registering a rise of 6.14%, compared with 2013. Meanwhile, Money Market Instruments posted an income of RM619.65 million.
Real Estate and Infrastructure contributed RM1.39 billion in investment income in 2014. This inflation-linked asset class, which the EPF has started invested in since 2010, has over the years been showing encouraging performance and is a 22.31% increase from 2013.
As at 31 December 2014, the EPF’s total investment assets stood at RM636.53 billion, up 7.91% from RM589.87 billion in 2013.
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