EPF Reports RM19.67 Bln Investment Income In 3Q

KUALA LUMPUR, Nov 11 (Bernama) -- The Employees Provident Fund’s (EPF) investment income rose by RM5 billion to RM19.67 billion in the third quarter (3Q) of 2024, from RM14.67 billion in 3Q 2023.

This had brought its total investment income to RM57.57 billion for the January-September (9M 2024) period, a 20 per cent growth compared to RM47.86 billion in 9M 2023, said chief executive officer Ahmad Zulqarnain Onn.

“The EPF’s robust performance reflects its investment strategy of maintaining a highly diversified portfolio across major asset classes,” he said in a statement today.

He also highlighted that the positive performance was bolstered by Malaysia’s gross domestic product (GDP) growth of 5.9 per cent in 2Q 2024.

“The highly anticipated reduction in the United States (US) interest rates drove market sentiment and gains across multiple sectors, including real estate investment trusts, utilities and financials, all of which positively impacted the EPF’s investment portfolio.

“Nonetheless, risks remain in the global outlook such as the trajectory and pace of interest rate reductions, persistent and escalating geopolitical tensions, particularly in the Middle East, and potentially higher import tariffs into the US with the election of Donald Trump last week,” he added.

Ahmad Zulqarnain said equity investments were a substantial income contributor in 3Q 2024 at RM18.32 billion, compared to RM9.17 billion in 3Q 2023.

Meanwhile, fixed income provided a steady income stream and mitigated the impact of short-term market volatility, with the asset class -- comprising Malaysian Government Securities and Equivalents and Loans and Bonds -- contributing 33 per cent or RM6.51 billion to EPF’s total investment income in 3Q 2024.

At the same time, real estate and infrastructure recorded a gain of RM820 million in 3Q 2024 on a constant currency basis.

“As the majority of real estate and infrastructure investments, as well as money market instruments, are denominated in non-ringgit currencies, aolng with the recent strengthening of the ringgit against the US dollar in 3Q 2024, the asset classes experienced a loss of RM3.71 billion and RM1.45 billion respectively after foreign exchange translation,” he noted.

These positions, however, he believed are temporary, reflecting current currency movements.

In addition, EPF’s investments in real estate and infrastructure are structured for the long term where currency movements have less impact on overall actual returns.

As of September 2024, the EPF’s investment assets stood at RM1.22 trillion, with 62.2 per cent allocated to local investments and 37.8 per cent to international investments.

“In 3Q 2024, international investments contributed RM10.50 billion, accounting for 53 per cent of total investment income.

“Of the total investment income, RM48.02 billion was generated for Conventional Savings, and RM9.55 billion for Shariah Savings,” the EPF said.

On Malaysia’s labour market, it noted that employment rose by 1.9 per cent year-on-year and the unemployment rate remained low at 3.2 per cent, adding that the labour force participation rate has remained stable at 70.5 per cent.

This contributed to an increase in the EPF’s new membership, with 364,364 new members registering in 9M 2024, bringing its total membership to 16.1 million.

A total of 8.69 million are active members, which now represent 50.4 per cent of Malaysia’s 17.24 million labour force.

Additionally, new employer registration rose by 55,717, bringing the total number of active employers registered with the EPF to 612,889.

Total contributions received increased from RM23.1 billion in 3Q 2023 to RM25.2 billion in 3Q 2024, it said.

In the first half of 2024 (1H2024), total contributions to i-Saraan rose by 103 per cent to RM1.61 billion from RM789.3 million in 1H 2023, while the number of contributing members rose by 56 per cent to 30,196 from 211,361 members previously.

In 9M 2024, the EPF saw the number of voluntary contributors rising by 29 per cent to 938,695 from 730,066 in 9M 2023, with voluntary contribution totalling RM10.37 billion, an increase of 72 per cent from RM6.03 billion recorded in 9M 2023.

Meanwhile, the number of formal sector members who opted to contribute more than the statutory rate rose to 65,695 in 9M 2024 from 55,946 in 9M 2023.

-- BERNAMA