EPF dividend of 6.3% for 2024 is highest in seven years – CEO

SHAH ALAM: The 6.3 per cent dividend rate announced by the Employees Provident Fund (EPF) for both Simpanan Konvensional and Simpanan Shariah for 2024 is the highest since 2017, according to chief executive officer Ahmad Zulqarnain Onn.

Among the factors determining the latest dividend rate were the 12.7 per cent increase in the equity market in Malaysia and the 17 per cent growth in the global equity market, he said.

“Hence Malaysia’s gross domestic product (GDP) growth rate was also quite strong at 5.1 per cent.

“These factors led to the EPF dividend increasing from 5.5 per cent (for Simpanan Konvensional) in 2023 to 6.3 per cent last year,” he told reporters during the EPF’s 2024 dividend briefing here today.

The EPF today declared a dividend rate of 6.3 per cent for Simpanan Konvensional and Simpanan Shariah which involves payouts of RM63.05 billion and RM10.19 billion, respectively.

The total payout for 2024, therefore, amounts to RM73.24 billion.

ALSO READ: EPF announces 6.30% dividend for 2024, RM73.24 billion in total payout

Last year was the first year that the EPF fully separated its Simpanan Konvensional and Simpanan Shariah portfolios so that the two funds could be managed independently.

“We can implement separate and different strategies according to the asset markets under both of these funds. That’s our long-term target, which is to have similar dividend rates.

“From year to year, the rates may differ, but coincidentally, this year they are the same. This may not be the case in the future,” he said.

Commenting on the dividend prospects for 2025, Ahmad Zulqarnain said the EPF cannot forecast the dividend rates as it depends on several challenges including geopolitical risks and international trade risks influenced by the United States.

On Akaun Fleksibel which was launched in May 2024, he said withdrawals from the account totalled RM12.2 billion last year, a figure that was lower than the RM25 billion that was originally anticipated.

“Of our membership, we saw 70 per cent did not utilise Akaun Fleksibel and only 30 per cent of the four million members made withdrawals from the account.

“We are pleased with this ratio which shows the majority of Malaysians do intend to keep their retirement savings,” he explained.

In terms of assets under management, he noted that the figure increased 10 per cent year-on-year (y-o-y) to RM1.25 trillion in 2024.

Looking at the long-term growth rate over the past two decades, he said it translates into 8.5 per cent y-o-y.

READ MORE: EPF investment assets at RM1.25 trillion, 63% invested in domestic market