KUALA LUMPUR: The Employees Provident Fund (EPF) has declared a 6.4 per cent dividend for 2015, involving RM38.24 billion in total payout to its contributors.
The EPF paid 6.75 per cent dividend for 2014, the highest rate since 1999, with total payout amounting to RM36.66 billion. In 1999, the dividend was 6.84 per cent.
The EPF recorded RM44.23 billion gross income last year, up 13.18 per cent from RM39.08 billion in 2014.
“As a retirement savings fund, our investments have always emphasised on sustainability of returns over a long term horizon as opposed to short term gains.
“We are pleased to declare a dividend rate of 6.4 per cent, a commendable performance given the prevailing challenges,” the EPF chairman Tan Sri Samsudin Osman said in a statement today.
“More importantly, we were able to meet our two strategic investment targets of at least 2.5 per cent nominal dividend on a yearly basis as required by the EPF Act 1991 and at least two per cent real dividend on a rolling three-year basis,” Samsudin added.
For 2015, the rolling three year real dividend was 4.05 per cent, 205 basis points higher than the target.
He said a combination of growth fears and depressed commodity prices have seen most major indices fall, including the FBMKLCI, since the start of the year. This was a very different climate than the first half of 2015 in which the EPF investments in global markets were able to mitigate the impact from the domestic market downturn.
“The volatility in the currency markets also means that it will be difficult for the EPF to repeat the outperformance in global assets that we saw in 2015. Nevertheless, we will continue to preserve and further enhance the value of capital from members’ contribution by maintaining stable and consistent returns over the long term within tolerable risk limits,” he explained.
The payout amount required for every one per cent dividend rate for the year was RM5.98 billion, 10.13 per cent higher than RM5.43 billion in 2014, the EPF said.
The increase was in tandem with the growth in investment assets of the EPF, which stood at RM684.53 billion as at Dec 31 last year.
The fund’s diversification into global assets and currencies allowed it to realise significant gains with profits from non-ringgit sources making up 48 per cent of the EPF’s total gross investment income throughout the year.