EPF records RM4.8b investment income in second quarter

KUALA LUMPUR, Sept 3 – The Employees Provident Fund (EPF)recorded an investment income of RM4.8 billion in the second quarter of 2009, as investments in equities raked in better returns.

The income was 46.64 per cent better than the RM3.27 billion accrued in the first quarter of this year, EPF said in a statement here today.

“Despite the instability of the global economy, the EPF managed to meet expectations and deliver better investment results in the second quarter,” said its Chief Executive Officer Tan Sri Azlan Zainol.

Equities was the highest income contributor for the quarter, growing seven-fold to RM1.74 billion, against RM239.55 million earned in the previous quarter.

He said improving global and domestic markets contributed to the surge in income from equities for the quarter under review.

Azlan said the second quarter showed signs of recovery in major global equity indices especially in countries where the provident fund had invested.

“While we cannot say the worst is over. Should the trend continue, or at least maintain at the current level, EPF is positive we can reverse the bulk of the allowances for diminution in value of equity investments that we made last year,” he added.

In the second quarter, loans and bonds were the highest income earner, contributing RM1.81 billion to EPF’s total investment income compared with RM1.78 billion attained in the previous quarter.

Another major contributor was income from Malaysian Government Securities, which rose marginally by RM830 million to RM1.11 billion.

Meanwhile, money market instruments recorded an income of RM94.27 million during the quarter, a drop of 21.51 per cent from RM120.11 million earned in the first quarter 2009.

EPF’s total fund size currently stood at RM353.93 billion, up 1.61 per cent from the first quarter’s fund size of RM348.31 billion.

“While there are signs of stabilisation in the global market, it is nevertheless too early to see how this will affect us for the remainder of the year,” he said.

Azlan said as a long term investor and custodian of more than RM350 billion in retirement funds, the EPF would continue to take proactive measures.

He assured that the fund would continue to enhance the value of its members’ savings, in these challenging times, while maintain prudent approach at all times. – Bernama