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Lowest EPF dividend since 2008 — 5.45% for conventional, 5% for syariah

TheMole
Written by TheMole
/* Style Definitions */ table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-parent:””; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi; mso-fareast-language:EN-US;} KUALA LUMPUR — Feb. 22, 2020: The Employees Provident Fund (EPF) has declared a dividend of 5.45% for conventional savings and 5% for syariah savings for last year. The dividend for conventional is the lowest since 2008. Last year, the agency declared 6.15% for conventional savings and 5.9% for syariah. Despite the lower dividends, the EPF said its overall investment assets grew to RM924.75 billion as it experienced a 2.8% growth in membership to 14.6 million, while the employer base expanded by 3% to 522,300. There was also a 24.6% rise in i-Akaun subscribers to 7.6 million. Chief EPF officer Alizakri Alias said in a statement that the pension fund’s performance last year was much influenced by the more volatile global economy compared to 2018. “Many issues in the global markets remained unresolved but we also saw some new issues cropping up. There were three rate cuts by the US Federal Reserve, the US-China trade spat escalated and continues to be unresolved, and there were issues surrounding the Brexit negotiations. On top of this, we did not expect the Hong Kong protests to be prolonged and that certainly added pressure on an already fragile far-east market,” he said. Alizakri added that the domestic markets did not support the income-generating capabilities of the EPF, as 70% of the fund’s assets were in Malaysia, mostly domestic equities. The EPF Act requires the fund to declare at least a 2.5% nominal dividend every year. On syariah savings, Alizakri said it differs from conventional savings because the universe of assets it can invest in is more restricted than that of conventional savings. A majority of the investments were in the domestic market which did not perform as well in 2019. The EPF expects 2020 to be another challenging year as the Covid-19 scare may likely worsen the currently weak global growth.

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