KUALA LUMPUR: The weakening of the ringgit will not affect the Employees Provident Fund (EPF) investment strategy, as its asset allocation strategy is already determined and valid for three years, according to EPF chief executive officer Datuk Seri Amir Hamzah Azizan.
He said that EPF is a long-term institutional investment and that the organisation will take advantage of opportunities and invest accordingly.
Amir Hamzah also said that EPF engages in both short and long-term investments based on its strategy, but as a long-term institutional investment, it does not make drastic shifts in its investment strategy.
"Currently, 64 percent of EPF's total asset allocation is invested locally in the ringgit base, while overseas investments depend on assessments regarding the sale of assets, realisation of investment value, or investment in other assets based on returns," he told reporters on the sidelines of the International Social Well-being Conference 2023 (ISWC 2023) here today.
Amir Hamzah described these actions as part of their normal business conditions.
"If we believe market prices are favorable, we may sell some assets at that time and if we find any new investment opportunities, we will invest in them," he added.
Amir Hamzah also expressed optimism regarding EPF's financial performance in the second quarter, noting that despite the local equity market declining by 7 to 8 percent in the first half of the year, EPF has the potential to benefit from market volatility.
Additionally, EPF encourages its members who are 55 years old to withdraw their savings periodically rather than in a lump sum.
This approach aims to support individuals in continuing to save and ensuring they have sufficient funds for retirement.
Amir Hamzah said in terms of social protection, a lump sum withdrawal may not be wise, as their savings may not last throughout their lifetime.
EPF plans to organise these periodic withdrawals on a monthly basis, providing members with enough income while allowing the remaining funds to continue compounding for better returns.
"The withdrawal amount is flexible and members can voluntarily request this type of withdrawal," he added.
Amir Hamzah also said further discussions with the government are required to determine whether these withdrawals should be mandatory or voluntary, and whether this approach should be introduced to new EPF members.--ends--