EPF declares 5.8% dividend

KUALA LUMPUR: The Government has announced a 5.8% Employees Provident Fund (EPF) dividend for last year, up from 5.15% in 2006.

Second Finance Minister Tan Sri Nor Mohamed Yakcop said the dividend would be credited into members’ accounts on March 1.

“The EPF has been efficient in managing the fund and is able to declare an attractive dividend rate,” he said.

He made the announcement after a closed-door briefing at the EPF headquarters here yesterday.

The EPF’s dividend rate has been steadily growing since it hit a low of 4.25% in 2002.

“Investment in foreign assets has achieved good returns and I hope the EPF will continue to take new initiatives for the country’s development,” said Nor Mohamed.

The EPF, the sixth biggest old age fund manager in Asia, has RM312bil in assets and plays an important role in the country’s development, he said.

It has in its portfolio US$1.8bil (RM5.76bil) worth of assets in foreign countries, a result of recent diversification efforts, he said.

“Although the current market situation will affect us in the short term, Malaysia has big savings funds and this is a good opportunity, given our strong fundamentals, for the funds to pick up some stocks because prices are attractive,” he said.

On the housing loan monthly instalment withdrawal scheme introduced on Jan 1, Nor Mohamed said the response was good and the EPF had approved 4,378 applications amounting to RM75mil as of Monday.

EPF chief executive officer Datuk Azlan Zainol said the Fund hoped

to invest more in the local and

foreign markets if opportunities arose.

Prime Minister Datuk Seri Abdullah Ahmad Badawi said the EPF's dividend rate had nothing to do with the coming general election.

He said the higher dividend was given out because the EPF was able to generate higher returns as its share investment portfolio had made more profits.

“When we have more money, we give more. Why say it is the election?” he said after a briefing for 3,000 Umno members at the Putra World Trade Centre in Kuala Lumpur yesterday.

On the share market, Abdullah said the country's well-managed economy was among the factors which have maintained investors' confidence in the market.

Meanwhile, Malaysian Trades Union Congress president Syed Shahir Syed Mohamud said the MTUC had hoped for a slightly higher figure than 5.8%.

“We hope they will give better dividends in future,” he said.