EPF’s 1H2023 Results Are Impressive!

The Employees Provident Fund (EPF) recorded total investment income of RM33.19 billion for the first half of the year ended June 30, 2023 (1H2023), up RM9.44 billion or 39.7% from the RM23.75 billion recorded for the corresponding period in 2022.

The retirement fund said the amount was arrived at after netting off listed equity write-downs recorded for the period under review.

It said out of the RM33.19 billion total investment income, RM4.79 billion was generated from mark-to-market (MTM) gains in securities that had not been realised. This is just “paper profits”. MTM gains were mainly due to fluctuations in foreign exchange rates.

The EPF’s total investment income for the second quarter (2Q2023) was RM18.03 billion, up RM9.05 billion from RM8.98 billion recorded for the same quarter last year. Equity investments continued to be the main contributor of income in 2Q2023 at RM9.60 billion. In comparison, the asset class generated RM4.07 billion in income during the corresponding quarter in 2022.

A significant portion of the improvement was due to proactive and timely realisation of profits, supported by the MTM gains in securities. After taking into account the write-downs, these numbers accounted for 53% of total investment income for the quarter.

Due to active portfolio management by the EPF’s fund managers, write-downs for 2Q2023 were minimal at RM350 million, compared with the RM2.15 billion recorded for the same quarter a year earlier. 

If this trend continues, it is good news for contributors in 2024. The dividend to be received could be higher than 5.35% declared for 2022. Let’s just hope this institution remains professionally run without any political interference.

Reference:

EPF records RM33.19b investment income for 1H2023, up 39.7% y-o-y, Surin Murugiah, TheEdgeMalaysia.com, 16 August 2023