EPF registers investment income of RM18.31bil in 1Q

KUALA LUMPUR: The Employees Provident Fund (EPF) recorded an investment income of RM18.31bil in the first quarter ended March 31, 2025 (1Q25), a weaker performance from a year ago as equities contribution fell amid softer global equity markets.

The pension fund said its quarterly income - which was 13% lower than RM20.99bil in the corresponding period in 2024 - was  cushioned by its diversified global portfolio. 

It added that its portfolio remained on course for long-term value creation.

"In a more challenging and uncertain market environment, the EPF maintains a dynamic and well-diversified portfolio to help safeguard value and manage downside risks. 

"We continue to actively explore investment opportunities across both domestic and international markets to strengthen our portfolio and support long-term, sustainable returns for our members,” said CEO Ahmad Zulqarnain Onn.

Moving forward, the EPF expects global economic conditions to remain challenging amid persistent geopolitical tensions and the risk of high tariff and non-tariff barriers between major economies, particularly the US and China.

"While some central banks have begun to ease monetary policy, concerns over global political instability, fiscal imbalances, and regional conflicts continue to dampen market sentiment and undermine investor confidence."

The EPF's total investment assets stood at RM1.26 trillion as at March 2025. Of these, 38% was invested internationally.

As for domestic investments, the EPF said they accounted for 62% of total assets, providing long-term income stability through dividends, interests and profits from sukuk. 

"The EPF remains committed to supporting Malaysia’s economic growth by continuing to invest over 70% of its annual allocation in the domestic market. 

"This reflects its role as a long-term investor and aligns with the Government’s Ekonomi MADANI framework," it said. 

It added that it is focused on building investment opportunities in the healthcare sector via the GEAR-uP initiative, which aims to capture long-term growth, address critical system gaps and support healthier retirement for Malaysians.

By asset class, equities - the highest contributor to the EPF's income -  fell 23% year-on-year (y-o-y) in 1QFY25 to RM10.81bil due to weaker performance across global equity markets and a challenging investment climate.   

However, fixed income continued to anchor capital preservation with a RM5.99bil contribution, representing 33% of total investment income.

"Fixed income, comprising Malaysian Government Securities and Equivalents, Loans and Bonds, continues to fulfil its dual mandate of delivering stable returns and as a counterbalance to equity market fluctuations. This underscores its strategic importance in safeguarding members’ savings across market cycles," said the EPF.

The real estate and infrastructure segment recorded an income of RM1.08bil during the quarter under review, while money market instruments generated RM430mil, in line with return expectations.

Of the total investment income, RM15.87 bil was generated for Simpanan Konvensional, and RM2.44bil for Simpanan Shariah.