EPF’s Investment Income Surges 20% in First Nine Months of 2024, Driven by Equity Gains and Economic Growth
Malaysia’s Employees Provident Fund (EPF) reported a robust investment income increase in Q3 2024, reaching RM19.67 billion, up from RM14.67 billion in Q3 2023. This brought EPF’s total investment income for January-September 2024 to RM57.57 billion, marking a 20% increase compared to RM47.86 billion during the same period last year, according to EPF CEO Ahmad Zulqarnain Onn.
Ahmad attributed the fund’s strong performance to a diversified investment strategy and Malaysia’s GDP growth of 5.9% in Q2 2024. “The EPF’s robust performance reflects its investment strategy of maintaining a highly diversified portfolio across major asset classes,” he noted.
Equity and Fixed Income Lead Investment Gains
Equity investments emerged as a major income driver, contributing RM18.32 billion in Q3 2024, compared to RM9.17 billion in Q3 2023. Fixed income assets, which include Malaysian Government Securities, Equivalents, Loans, and Bonds, provided a steady income of RM6.51 billion, accounting for 33% of total investment income and helping to offset market volatility.
Real estate and infrastructure assets recorded a gain of RM820 million on a constant currency basis in Q3. However, due to the ringgit’s recent strengthening against the US dollar, EPF incurred foreign exchange losses of RM3.71 billion and RM1.45 billion for real estate and money market instruments, respectively. Ahmad clarified that these currency effects are temporary and that EPF’s real estate and infrastructure investments are structured for long-term returns where such movements have minimal impact.
Strong Contribution from International Investments
International investments contributed RM10.50 billion in Q3 2024, representing 53% of EPF’s total investment income. As of September 2024, EPF’s total assets stood at RM1.22 trillion, with 62.2% allocated locally and 37.8% in international markets.
The total investment income generated RM48.02 billion for Conventional Savings and RM9.55 billion for Shariah Savings.
Growth in Membership and Contributions
Malaysia’s strong labor market, with an employment rate increase of 1.9% year-on-year and a stable unemployment rate of 3.2%, supported EPF’s expanding membership. New memberships totaled 364,364 in the first nine months of 2024, bringing EPF’s overall membership to 16.1 million, of which 8.69 million are active members, representing 50.4% of Malaysia’s labor force.
Total contributions received by EPF increased from RM23.1 billion in Q3 2023 to RM25.2 billion in Q3 2024. Voluntary contributions have also surged, with the i-Saraan scheme receiving RM1.61 billion in 1H 2024, up by 103% from the previous year.
The number of voluntary contributors rose by 29% year-on-year to 938,695, with voluntary contributions reaching RM10.37 billion, a 72% increase from RM6.03 billion in 9M 2023. Formal sector members contributing above the statutory rate also grew, totaling 65,695 in 9M 2024, compared to 55,946 last year.
Outlook and Strategic Focus
EPF’s positive performance in Q3 2024 underscores its resilience and strategic approach amid global economic uncertainties. Ahmad noted the potential impact of global factors such as US interest rate movements and geopolitical tensions, particularly in the Middle East. However, EPF’s continued emphasis on diversified, long-term investments is expected to sustain its growth and provide stable returns to its members.
