THE Employees Provident Fund (EPF) recorded an investment income of RM57.57 billion for the first nine months of 2024, reflecting a 20% increase from RM47.86 billion during the same period last year.

For the third quarter ending September 30, 2024, the fund posted RM19.67 billion in investment income — up by RM5 billion from RM14.67 billion in Q3 2023.

In a statement today, EPF CEO Ahmad Zulqarnain Onn attributed the growth to the fund’s diversified investment approach, supported by favorable economic conditions, a 5.9% year-on-year gross domestic product (GDP) growth in Malaysia for the second quarter (Q2), and a 13% year-to-date gain in the FBM KLCI, which closed at 1,648 in Q3.

EPF said investor sentiment was bolstered by Malaysia’s economic performance, and globally, the US Federal Reserve’s 50 basis point interest rate cut in September positively impacted equity markets, especially in the real estate, utilities, and financial sectors.

The EPF’s equity portfolio generated RM18.32 billion in income for Q3 2024, a significant rise from RM9.17 billion a year ago, with a proactive investment strategy amid volatile markets.

Fixed income, crucial for capital preservation, brought in RM6.51 billion, about 33% of the EPF’s total Q3 income, supported by Malaysian Government Securities, bonds, and loans.

Real estate and infrastructure investments contributed 82 million on a constant currency basis.

However, due to the recent strengthening of the ringgit against the US dollar, EPF said currency translation caused a temporary loss of RM3.71 billion for real estate and RM1.45 billion for money market instruments.

As of September 2024, EPF’s total assets reached RM1.22 trillion, with a 62.2% allocation in Malaysia and 37.8% abroad, generating RM10.5 billion, or 53% of Q3’s investment income, from international holdings.

From its total income, RM48.02 billion was for conventional savings, while RM9.55 billion was allocated for Shariah savings.

Malaysia’s resilient labor market has also contributed to EPF’s expanding membership, with employment up 1.9% year-on-year and a steady 3.2% unemployment rate.

These factors attracted 364,364 new members in the first three quarters, bringing total EPF membership to 16.1 million, of which 8.69 million are active contributors.

New employer registrations for this period also rose, totaling 55,717 and bringing active employers to 612,889.

The i-Saraan scheme, aimed at enhancing retirement security for those in the informal sector, has also seen significant growth, with contributions from 330,196 members reaching RM1.61 billion by mid-2024, reflecting a 103% rise year-on-year.

Ahmad Zulqarnain praised the Government’s Budget 2025 decision to enhance i-Saraan with a 20% matching incentive, up to RM500 annually, effective January 2025.

He noted that the increase aligns with EPF’s commitment to fostering a culture of saving, especially among Malaysians in the gig and informal sectors, to secure a stronger retirement future.

“Our investment strategy continues to focus on sustainable returns that not only benefit members but also bolster Malaysia’s economic resilience,” Ahmad Zulqarnain stated. — TMR