KUALA LUMPUR: The Employees Provident Fund (EPF) outsourced RM114.56 billion to external portfolio managers as at 31 December 2017, an increase of 9.80 per cent compared with RM104.37 billion in 2016.
This allocation, which was invested in both equity and fixed income instruments, represents 14.50 per cent of the EPF’s total investment assets.
“As we gear up towards becoming a trillion-ringgit fund, we will continue to outsource a portion of our funds as part of our diversification initiative, and to suitably leverage on the knowledge and skillsets of external fund managers that complement our own internal fund management capabilities,” EPF chairman Tan Sri Samsudin Osman said at the recently held EPF External Portfolio Managers Annual Awards 2018.
“We will continue to increase our exposure in the markets we invest in, especially in alternative investments and infrastructure. However, taking into account the prevailing market volatility and subdued growth, our expansion will be done gradually and in a prudent manner,” he added.
With about 45 per cent of investment assets being shariah-compliant, the EPF expects to grow these assets by at least RM25 billion a year on average to meet the demand of its members.
Samsudin noted that the competition for high quality Islamic assets was not only confined to investors in the Muslim world, but to the Western pension funds as well, given the attractiveness of Islamic assets as an alternative and ethical source of financing.
“The EPF needs more quality Islamic assets to invest in, and we welcome external managers to join us in our commitment to growing our shariah mandate,” he said.
The EPF External Portfolio Managers Annual Awards 2018 saw 14 awards being presented to the top performing external portfolio managers.