Why isn't the Malaysia govt as smart as the PAP when it comes to managing EPF?
Their GIC equivalent can just issue risk free bonds guaranteed at 3.5% then make the EPF buy these bonds, take this money to invest and keep the returns for themselves for the hard work and risk they are taking.
Without doing this bond issuance, they now have to return all this money to EPF holders - stupid. The EPF guarantees a minimum of 2.5% by law and since its inception has never gone below 4% (the worst year was 2002 when it returned 4.25%...it regularly returns 7-8%). Imagine how much money their GIC equivalent could have made if they are able to keep these returns. Thank goodness we Singaporeans are lucky have smart govt and a great CPF scheme to go along.
Malaysia's Employee Provident Fund H1 investment income up 39 pct - report
Published : Thu, 23 Aug 2007 12:51
By : Agencies Print this Story
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KUALA LUMPUR (Thomson Financial) - Malaysia's state pension fund, the Employees Provident Fund (EPF) reported Thursday that its investment income in the first half grew 38.6 percent to 9.8 billion ringgit from 7.1 billion a year earlier, according to the official Bernama news agency.
EPF's unaudited first-half results showed income from equities rose 141 percent to four billion ringgit, accounting for 40.8 percent of the fund's generated income, the report said.
EPF chief executive officer Azlan Zainol said returns on its equities portfolio were encouraging but EPF 'will remain cautious as investments in the equities sector pose relatively higher risks over most other instruments.'
Azlan said a total of 58.6 billion ringgit in funds were invested in the equities market in the first half.
Accumulated investments amounted to 301.4 billion ringgit as of end-June, he said.
He said income derived from money market instruments rose 79.7 percent to 592.4 million ringgit from 329.7 million last year.
Loans and bonds contributed 2.8 billion ringgit to the funds's total investment income, while income from investments in Malaysia Government Securities and property accounted for 2.4 billion and 23.3 million ringgit respectively, he said.
(1 US dollar = 3.48 ringgit)