KUALA LUMPUR: Employees' Provident Fund (EPF) contributors are expected to receive a significantly reduced dividend compared to last year's rates of 6.1 percent for conventional accounts and 5.65 percent for shariah savings.
A source familiar with the matter said the dividend for conventional savings was expected to range from 4.8 to 5.1 percent, while shariah savings could be between four and 4.5 percent.
The source said EPF was slated to make an official announcement today, barring any unexpected changes.
"However, the rates are definitely much better than commercial bank interests for fixed deposits. Under the circumstances, they should be acceptable, especially those with high savings in their accounts," the source told FMT.
The source added that although the rates had decreased significantly, it was the most optimal outcome achievable by the fund considering the performance of the worldwide financial markets during the past couple of years.
EPF's dividend payout for conventional savings have ranged from a low of 5.2 per cent (2020) to a high of 6.9 per cent (2017) over the past decade.
Last month, economist Professor Dr Yeah Kim Leng of Sunway University told FMT that most international funds, including EPF, were expected to record losses or report poor performance for 2022 due to rising interest rates which have battered capital markets last year.
He said sizeable parts of EPF's portfolio were in fixed-income securities and foreign stocks, which had a major impact on its profits.