EPF Showed Resilient Performance 1H2021 Due to Equities

The Employees Provident Fund (EPF) delivered a resilient performance in 1H2021, driven by the progressive recovery of the equity markets and most asset classes amid the global rebound says EPF CEO Datuk Seri Amir Hamzah Azizan in a September 24 statement accompanying the 2Q2021 performance release.

The EPF’s net investment income of RM33.8 billion in 1H2021 was 61.3% more than the RM20.96 billion in 1H2020 — with only RM0.26 billion write-down largely from listed equities in 1H2021 compared with RM9.16 billion in 1H2020, of which RM7.5 billion took place in 1Q2020.

The 1H2021 performance is significant given that the EPF paid out RM47.64 billion in dividends in 2020 , RM42.88 billion for Conventional Savings and RM4.76 billion for Shariah Savings.

The EPF’s RM14.77 billion gross investment income for the second quarter ended June 30, 2021 (2Q2021) came in 23% or RM4.52 billion below a record-high quarterly result of RM19.29 billion in 1Q2021.

Some 37% of its RM989.14 billion investment assets as of end-June were overseas. They generated RM8.71 billion or 59% of total gross investment income in 2Q2021 and RM11.15 billion or 58% of total gross investment income in 1Q2021.

The EPF’s total investment assets — which grew 7.9% or RM73 billion year on year last year to end 2020 at RM998 billion — slipped 0.9% or RM8.86 billion in the first half of the year to RM989.14 billion as at end-June.

Yet, there is a good chance of the EPF paying a higher dividend for the whole of 2021 than the 5.2% paid for Conventional Savings and 4.9% paid for Shariah Savings last year if there continues to be little reason for write-downs.

Due to strong income contributions from equities in 1Q2021 of RM14.28 billion or 74% of the RM19.29 billion in gross investment income earned in the first three months of 2021, total gross investment income in the first half of 2021 (1H2021) was RM34.06 billion or 24.9% more than the RM27.28 billion booked in 1H2020.

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