CB answers critics: EPF share portfolio’s unrealised profits top Rs. 10 b mark

In an apparent response to critics of the management of the over Rs. 1 trillion plus Employees Provident Fund, the Central Bank on Friday revealed the huge quantum of realised and unrealised gains out of its investments as of September.
The Central Bank said the net unrealised profits of the EPF share portfolio passed the Rs. 10 billion mark on 11 September. In addition, realised capital gains and dividends have amounted to Rs. 3.4 billion so far, this year.
“This milestone was particularly significant since during the first half of 2014, there were allegations levelled at the EPF that its share portfolio had suffered large unrealised losses during the period spanning early 2012 to early 2014,” the Central Bank said in its statement.
“However, as always maintained by the EPF, such claims have now been proved baseless, with the unrealised losses turning into substantial unrealised gains in the second half of this year,” the statement added.
The EPF has also earned substantial profits from its investments in Treasury bills and Treasury bonds over the years, with the EPF earnings of Rs. 112.3 billion in 2011, Rs. 117.4 billion in 2012 and Rs. 131.4 billion in 2013, with such surpluses being credited to the member accounts at the end of each of the respective years.
The Central Bank also said the audit of the EPF’s Financial Statements for 2012 has been completed by the Auditor General and the Annual Report for 2012 has already been printed and submitted to the Ministry of Labour for tabling in Parliament in the near future.
The EPF’s Financial Statements for 2013, which were published in national newspapers on 8 May 2014, are currently being audited by the Auditor General, and after finalisation of the audit, the Annual Report for 2013 is due to be tabled in Parliament by October 2014.
“Notwithstanding the successful results and the regular publishing of financial statements even before the finalisation of the audits, certain politically-motivated parties have been levelling outrageous accusations against the EPF, probably in accordance with their political motivations,” the Central Bank statement said.
“In that background, the EPF wishes to advise the members of the EPF and the general public not to be misled by these politically motivated statements, and to be reassured that the responsibilities placed upon the Monetary Board of the Central Bank by the EPF Act have been diligently discharged in the past, and will be so done in the future too,” the statement added.