This article first appeared in The Edge Financial Daily, on May 4, 2016.
KUALA LUMPUR: The Employees Provident Fund (EPF) is looking at increasing its equity-based assets as the provident fund aims to deliver real growth for its members and investors, said chief executive officer Datuk Shahril Ridza Ridzuan said.
Shahril said the EPF’s goal is to ensure its rate of return is above Malaysia’s annual inflation rate.
“Apart from the 2008 financial crisis, EPF has always gone above and beyond our promise of delivery of real returns,” Shahril told the media yesterday in conjunction with the launch of the EPF’s 2015 annual report.
EPF deputy chief executive officer (investment) Datuk Mohamad Nasir Ab Latif said in 2015 that equities made up 59% of EPF’s investment income, although only 44% of its investments were equity-based.
Mohamad Nasir noted that equities generate higher returns compared to other assets.
In geographical terms, Shahril said he expects the EPF to focus more on domestic investment due to poorly performing foreign markets, as well as the 26% limit EPF has on its investment globally.
The EPF’s annual report revealed 52% of its investment income had come from foreign investment. This was despite overseas assets constituting 25% of the EPF’s total assets.