EPF posts RM5.5b Q3 investment income

The Employees Provident Fund (EPF) says contributors can expect a higher dividend this year if the market recovery continues smoothly for the remaining period.

"The continued rally in the stock market has helped boost EPF investment income in the third quarter," its chief executive officer Tan Sri Azlan Zainol said in a statement issued yesterday.

The EPF generated investment income of RM5.5 billion in the third quarter of 2009, up 14.51 per cent, or some RM696.32 million, from the second quarter.

Equities continued to contribute significantly to its investment income, increasing 34.67 per cent to RM2.34 billion in the third quarter from RM1.74 billion in the second quarter.

Another major contributor was loans and bonds, which rose 4.07 per cent to RM1.89 billion from RM1.81 billion.

This was attributed to the regaining momentum and confidence in Malaysia's corporate bond market and the EPF's low-risk policy of investing only in high-grade companies with credit ratings of "AAA" or "AA".

Third quarter income from the EPF's investments in Malaysian Government Securities and properties was up 2.54 per cent to RM1.14 billion and 2.69 per cent to RM21.37 million respectively.

However, returns from money market instruments declined 7.38 per cent to RM87.31 million.

Year-on-year, third quarter investment income was a 52.71 per cent increase from RM3.6 billion.

Overall, the EPF's fund size currently stands at RM361.09 billion compared with RM353.93 billion in the second quarter.