KUALA LUMPUR, June 11, 2015:
The Employees Provident Fund’s (EPF) investment in the government’s strategic investment arm, 1 Malaysia Development Fund (1MDB)is only limited to RM200 million, the Prime Minister cum Finance Minister Datuk Seri Najib Razak said.
He added that EPF’s investment in Pembinaan PFI Sdn Bhd amounted to RM25.29 billion which is guaranteed by lease back from the federal government.
“EPF’s financing revelation in government-linked companies (GLC) is in the form of fixed-rate loans and bonds,” Najib said, adding that part of it was based on government guarantee, asset mortgage and bank guarantee.
The Prime Minister noted this in a written reply to PAS’ Shah Alam MP Khalid Samad who asked the government to list down GLCs who had borrowed from the fund and how the money has been used.
According to Najib, EPF’s financing portfolio in GLCs as of March 31 this year was at RM79.99 billion.
He added that to ensure EPF’s investment is protected and the value of investment for savers is stable and consistent for the long term, several steps had been taken. “Fifty percent of the EPF’s investment is in fixed-income instruments, which encompassed Malaysian government securities, level coupon bonds as well as loans and bonds for domestic and global mandates. “Therefore EPF’s returns would be influenced by interest rates and inflation,” he said. Najib added that EPF will continue to invest and diversify its investments in equity asset class and inflation comprising real estate and infrastructure in line with its strategic asset allocation in order to generate an optimal investment return at an appropriate risk.