SHAH ALAM: The Employees Provident Fund (EPF) is expected to declare a handsome dividend for 2021, ranging between 5.2 per cent and 6.0 per cent, on the back of the fund’s higher gross investments and better capital market performance, economists predict.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the EPF’s gross investments for the first nine months of 2021 was at 7.7 per cent higher year-on-year at RM48.02 billion, compared with the same period in 2020.
"In that sense, there could be a chance that the dividend rate could be better than in 2020. I think it should at least match the 2020 level, if not better,” he told Bernama and estimated that the dividend would likely be between 5.20 per cent and 5.40 per cent for 2021.
In 2020, the pension fund manager declared a dividend of 5.2 per cent with a payout amounting to RM42.88 billion for conventional savings and 4.9 per cent for Shariah savings, with a payout totaling RM4.76 billion.
Mohd Afzanizam said the chance for a better dividend rate in 2021 would be higher should corporate earnings in the fourth quarter turn out better.
Furthermore, the EPF has also been diversifying its portfolios into overseas markets and incomes from foreign equities have made a significant contribution to its total income, he noted.
"So their portfolio diversification strategy has really paid off and it could be translated into a sustainable dividend rate going forward,” he added. - Bernama