Epf Syariah Savings Not Part Of Simpanan Konvensional

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The Employees Provident Fund uses a policy called Syariah Income Ratio to share income between conventional and syariah savings. NSTP/ NUR IQBAL SYAKIRKUALA LUMPUR: The Employees Provident Fund (EPF) has shed light into the dividends distribution and disparity between its conventional and syariah savings.
Responding to claims that it might have used supposedly higher income from non-syariah investments to prop up the dividend for Simpanan Syariah, the EPF clarified that the syariah-compliant savings scheme operates separately from Simpanan Konvensional.
"Simpanan Syariah derives its income solely from its portion of the syariah portfolio, while income for Simpanan Konvensional savings is generated by both the syariah and conventional portfolios," the retirement fund told Business Times.
It noted that it uses a policy called Syariah Income Ratio (SIR) to share income between conventional and syariah savings, which has been consistent since 2017 after the latter scheme was introduced.
EPF recently announced a dividend of 5.5 per cent for conventional savings last year, involving a total payout of RM50.33 billion.
A dividend of 5.4 per cent for syariah savings will see a payout of RM7.48 billion, bringing the combined total payout for last year to RM57.81 billion.
The dividend payments mark a significant increase from 2022, where the dividend rates were at 5.35 per cent for conventional savings and 4.75 per cent for syariah savings.
EPF also explained the factors leading to the smaller gap between the dividends for syariah and conventional savings for last year.
It said in 2022, the syariah portfolio recorded significant equity write-downs totalling RM2.54 billion. This led to a much lower dividend payout of 4.75 per cent for the year.
"The higher write-down resulted in improved portfolio health for syariah (last year), which allowed more opportunity to realise gains as markets recover."
EPF further explained that improved portfolio health, coupled with a rally in syariah-compliant technology equities in the
United States and lower write-downs last year contributed to a more significant improvement in Simpanan Syariah dividends compared with conventional savings. - NST

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