No defaults in the RM219.3b loans given out: EPF

KUALA LUMPUR: The Employees Provident Fund (EPF) yesterday assured members that the RM219.3 billion loans it has extended to corporations and government agencies are being well serviced and none are in default.

The loan exposure accounts for 30% of the pension fund’s total assets under management (AUM) of RM731.1 billion as at end-December, 2016.

“If you look at our exposure to the government and government credit, it is roughly 30% of our AUM, that is a mixture of MGS (Malaysian government securities), GIIs (government investment issues), government guaranteed papers, loans to government and government agencies, none of that has gone into default. We’re very comfortable with our exposure,” said CEO Datuk Shahril Ridza Ridzuan.

He also noted that the EPF will only extend loans to corporations with “AA” ratings. Shahril declined to reveal the quantum of loans which are guaranteed by the government and those not guaranteed.

Earlier, the pension fund confirmed that the RM6.5 billion loan taken by Felda Global Ventures Holdings Bhd’s (FGV) holding company Felda Holdings Bhd is not in default and it continues to service the loan.

Meanwhile, commenting on the EPF’s investment losses in (FGV), Shahril said it was business as usual for its stake in FGV.

“We’ve been selling down FGV for a very long time, and we’ve been trading the stock as well. When it was low, we bought back in and sold later. If you look at 2016, there was hardly any impairment for FGV,” he added.

The EPF was reported to have lost about RM575.8 million from divesting its shares in FGV. It ceased to be the plantation giant’s shareholder in December 2016.