KUALA LUMPUR (April 8): Kumpulan Wang Persaraan (Diperbadankan)’s (KWAP) net investment income for the year 2019 swelled over five times or 437.9% to RM6.67 billion from RM1.24 billion in the same period a year earlier (2018).

According to the fund’s recently-published annual report for 2019, its latest reported net investment income between 2015 to 2019 was the second-highest after RM8.8 billion reported in 2017.

In contrast, 2018 marked its lowest net investment income for the five-year period; for 2015 and 2016, the country’s largest public services pension fund posted net investment incomes of RM4.4 billion and RM4.8 billion respectively.

In terms of total fund size, KWAP managed RM147.48 billion in 2019 — the highest over the period between 2015 and 2019. This represented a growth of 8.04% or RM10.97 billion over RM136.51 billion in the same period a year ago (2018). 

The increase was attributed to total comprehensive income of RM7.8 billion and total contribution of RM3.1 billion, said then KWAP chief executive Syed Hamadah Syed Othman in the report.

Prior to this, the pension fund had managed RM118.4 billion, RM125 billion and RM140.8 billion in 2015, 2016 and 2017.

According to Syed Hamadah, KWAP’s fund registered a strong performance across all asset classes in 2019.

KWAP’s target strategic asset allocation comprised 44% equities, 45.5% fixed income and 10.5% alternative investments.

“Despite the economic uncertainty and volatile market backdrop, KWAP delivered a stellar performance in 2019 due to our approach of focusing on a diversified portfolio of asset classes, in line with our strategic asset allocation.

“In addition, our consistent strategy of taking a long-term investment view stood us in good stead in riding out turbulent market conditions,” he added.

As at end 2019, KWAP has RM68.31 billion in equities, accounting for 46.35% of total assets. Total income realised stood at RM2.3 billion, of which 81% was from the domestic market. 

Meanwhile, KWAP’s fixed income investment market value fell by RM150 million to RM68.42 billion in 2019, as a result of portfolio rebalancing from an allocation of 49.69% in 2018 to 46.67% in 2019.

In line with the reduction in portfolio allocation, fixed income investments delivered slightly lower gross income of RM3.05 billion in 2019, compared to RM3.14 billion in 2018.

As for alternative investments, KWAP generated a total income of RM596.4 million in 2019, with a total portfolio of RM9.71 billion.

KWAP has a geographical investment exposure in 39 countries across all seven continents, based on its 2019 annual report.