Analysts doubt ASB payout will be any better next year

Permodalan Nasional Bhd (PNB) announced an income distribution of five sen a unit and a bonus of 0.5 sen for Amanah Saham Bumiputera (ASB) for 2019

Ahirul Ahirudin
Written by Ahirul Ahirudin

KUALA LUMPUR – December 19, 2019: The Amanah Saham Bumiputera (ASB) dividend payout this year, which was the lowest ever, will likely cause some negative repercussions in 2020.

Economic analysts, who projected this when talking to The Mole today said one of the obvious effects will be a likely similar low dividend payout next year.

Yesterday, Permodalan Nasional Berhad (PNB) announced the dividend payout at 5 sen per unit and a bonus of 0.5 sen per unit for ASB since its inception in 1990.

The total payout amounts to RM9bil for 10 million unit holders who own 167.2 billion units in ASB.

Associate Professor Dr Ahmed Razman Abdul Latif, a senior lecturer of Putra Business School said that those who applied for loans to invest into ASB (better known as ASBF, ‘F’ for financing) might be affected depending on the bank they borrowed from.

“Due to the lowest dividend rate announced by PNB this year, it may not be enough to keep the money rolling and some would have to top-up with their own cash to cover the interest.

“ASBF should only be treated as an investment, to invest only when you have extra income,” he said.

However, he believes that ASB is still a good choice to invest and that the returns are still competitive if compared with other similar low-risk investment schemes.  

When queried on what to expect next year, Razman said that he believes the ASB dividend next year would be more or less the same as the one announced yesterday.

Another analyst, professor Hoo Kee Ping said that it is only logical for PNB to announce the lowest ASB dividend rate this year since the last 18 months has not been rosy for the local share market.

“Our share market is the worst in the region, and it has been like that since our government decided to talk bad about our economic position, starting with the alleged RM1 trillion debt last year.

 “Of course investors abroad would shy away, causing our share market to go on a downward spiralling trend,” said Hoo.

“Today, even Hong Kong which is having a bad case of riots and political instability beats us when it comes to share market performance,” added Hoo.

He also gave a pessimistic view of next year, saying “…next year will be worse for not only ASB, but also Employees Provident Fund (EPF) and Khazanah as foreign fundings will not be coming back anytime soon.

However, Professor Dr Faridah Hassan of Universiti Teknologi Mara told The Mole that she believes that PNB would do better next year provided that they strategize well on its overseas investments.

In a press briefing yesterday, PNB group chairman Tan Sri Zeti Aziz said PNB will continue to strengthen its investment portfolio via its diversification strategy, tighter risk management and enhancing its internal capabilities through a progressive organisational transformation plan.

“If PNB strategise well on the diversified investment locally and abroad from the beginning of the year, the results shall be positive by year end,” said Faridah.



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Ahirul Ahirudin

Ahirul Ahirudin