Sri Lanka EPF member returns down to 9.54-pct in 2018

ECONOMYNEXT – Sri Lanka’s largest superannuation fund, the 2.3 trillion rupee Employees’ Provident Fund beat most mutual funds in terms of returns in 2018, but the interest paid to members fell to 9.54 percent in 2018, the lowest since 2006, data shows.

Return on investments of the portfolio was 10.4 percent in 2018, down from 11.8 percent the previous year, and interest paid to member accounts was 9.54 percent, the lowest since 2008, according to the Central Bank 2018 annual report. The bank manages the fund.

Popularly called the EPF, the fund’s returns were much better than most mutual funds, several of reported negative returns in 2018. Few funds did better than the EPF like the CAL Income Fund which returned 12.14 percent, First Capital Money Market Fund with a 13.34 percent return and JB Vantage Money Market Fund’s 12.05 percent return.

The EPF’s investment portfolio grew 15.4 percent to 2.29 trillion rupees, up from 1.99 trillion rupees a year earlier with member contributions growing 8.8 percent to 145 billion.

Investment income fell 0.1 percent to 222.4 billion rupees. Of this, interest income amounted to 229.4 billion rupees, up 4.4 percent from a year ago. Dividend income rose 29.9 percent to 3.9 billion rupees.

Equity marked-to-market losses deepened to 10.9 billion rupees, compared to a loss of 163 million rupees the previous year, which dragged down total returns of the portfolio.

Around 92 percent of the fund was invested in government securities with equity’s share reaching 3.3 percent, 1.9 percent in corporate bonds and 1.5 percent in fixed deposits.

The number of member accounts rose 3.3 percent to 18 million, of which 2.6 million were contributing members, while total refunds during year amounted to 108 billion rupees, down 8.1 percent from the previous year, according to data from the Central Bank, which manages the fund. (COLOMBO, 26 April 2019-SB)

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