KUALA LUMPUR: The Employees’ Provident Fund (EPF) may have to sell more of its investment assets overseas if the government allows contributors another round of withdrawals from the retirement fund.
Speaking at the Dewan Rakyat today, finance minister Tengku Zafrul Aziz also said that EPF’s dividend for conventional savings for 2021 could have reached 6.7%, instead of the 6.1% it recently reported, if not for the three previous rounds of withdrawals.
Tengku Zafrul said that if the government again allowed another one-off withdrawal of RM10,000, the 6.3 million contributors eligible for this might take out an estimated RM63 billion.
He warned that this would force the statutory body to sell more of its overseas assets.
“If this is allowed, EPF will have to implement portfolio balancing and its impact may exceed the withdrawals totalling RM63 billion,” he said.
“In order to prepare for the RM63 billion in withdrawals, EPF will have to sell more of its investment assets overseas in this volatile market, in view of the recent Russia-Ukraine conflict,” he added.
While Tengku Zafrul had always maintained his unwillingness to allow withdrawals from the retirement fund, a number of MPs had been repeatedly urging the government to allow another round of withdrawals from EPF due to the financial difficulties Malaysians have been facing because of the Covid-19 pandemic.
EPF members have been able to access up to RM71,000 from their pension funds through three previous EPF withdrawal programmes, which amounted to RM101 billion.
Following this, EPF said that a total of 6.1 million members, or 48% of its members under the age of 55, now had less than RM10,000 in savings in their retirement fund.