Malaysia's Employees Provident Fund said its investment assets edged up 0.8% to 989.14 billion ringgit ($236.16 billion) in the second quarter ended June 30, amid a continued stream of early withdrawals allowed to help workers cope with pandemic-related economic challenges.
EPF executives, in a news release issued Friday, sounded an alarm regarding the pandemic's longer-term impact on the country's retirement safety net.
While the government's stimulus packages can maintain business sentiment and domestic demand, "we are very concerned about the retirement security of the people, especially with 46% of EPF members below the age of 55 having less than (10,000 ringgit) in their account," said EPF CEO Amir Hamzah Azizan.
Under two current EPF programs — i-Sinar and i-Citra — a total of 67.6 billion ringgit of early withdrawals has been disbursed and another 12 billion ringgit approved, the news release said.
An additional 20.8 billion ringgit was withdrawn in 2020 under the EPF's initial early withdrawal program, i-Lestari, lifting the total amount of withdrawals made or approved since the coronavirus pandemic struck to just more than 100 billion ringgit.
The pandemic has led to a significant drop in the percentage of members meeting the Basic Savings threshold of 240,000 ringgit at age 55 to 27% from 36%, noted Mr. Azizan.
"As we recover from the crisis, EPF's focus is to help members restore and rebuild their retirement savings to ensure that they are able to secure a dignified retirement," he said.
Meanwhile, against a second-quarter investment backdrop that saw accelerating vaccine rollouts support developed market equities at the same time a resurgence of COVID-19 cases was weighing on Southeast Asian markets, the news release said the EPF's diversification efforts paid dividends during the latest period.
Overseas investments rose to 37% of the portfolio by the close of the latest quarter from 36% as of March 31, contributing 59% of the portfolio's 14.77 billion ringgit investment gain for the period. That was up from 58% of the prior quarter's 15.12 billion ringgit investment gain.
As of June 30, EPF reported equity allocations of 44%, fixed income holdings of 46%, another 6% in real estate and infrastructure and 4% in money market instruments — unchanged from the prior quarter.
