Nasfund profit

Members in for 15% windfall

 

 MORE than 300,000 working Papua New Guineans, members of superannuation fund Nasfund, will see their savings increase by 15% starting today, The National reports.

Nasfund joint chief executive officer Ian Tarutia announced the good news yesterday when declaring a net profit (after tax) of K205.617 million for 2009.

This simply means that if you have K10, 000 in your savings, you can expect a windfall of K1, 500.

“In fact, it is happening now as our systems are down to allow crediting into members’ accounts,” Mr Tarutia said.

As of midday yesterday, Nasfund shut down its normal daily operations to allow crediting to take place for its 126,812 active and non-active 186,222 members, including Eda Super contributors. Normal operations would resume today.

In total NasFund is crediting K213.5 million to the members’ accounts on the back of the fund’s excellent gains in the equity portfolio.

While the 15% interest rate was good news for members, NasFund cautioned members not to expect another double-digit return this year.

Last year, members received 8% after the record 37% in 2007, 10% in 2006 and 29% in 2005.

Mr Tarutia said Nasfund was cautious with this year “on the back of what is happening in the international economy.”

“The international environment remains uncertain at this point in time and there is potential for a double dip recession,” he said, adding indications were that this year’s rate may be slightly higher than the predicated 9.5% inflation rate.

He said the 15% rate came about as a result of last year’s financial results. These included: a net profit (after tax) of K205.617 million; net asset value of K1.7 billion; and in the other highlights the fund grew by 21% (compared to 19% in 2008) with the number of active employers that the Fund has is 1,784 representing a growth of 7.5% over last year; 123 employers’ net going into the fund; and active membership base as of Dec 31 was 126,812 members.

Mr Tarutia said Nasfund staff, management and the board were pleased with the results, adding the Management Expenditure Ratio (MER) was 1.12% down 0.13% from 1.25% in 2008.

“MER measures the efficiency of the fund…basically what we spent in administering the fund and the total asset value. This compares to 1.25% in 2008 so as we are growing and becoming more efficient in the use of assets in administering the organisation,” Mr Tarutia said.

In withdrawals the fund paid out K125.584 million to 55,846 members through unemployment, housing advancement, particle withdrawals, retirement and redundancy, among others.

The contributions (inflows) from employers by way of member and employer contribution contributed to K232.7 million,” he said.

The gains in equity portfolios were in New Britain Palm Oil Ltd, Lihir Gold Ltd, and Oil Search Ltd, as well as gains on the currency rate contributing K127 million.

Mr Tarutia said the unlisted portfolio contributed K14 million to the portfolio and the overall net gain despite a decrease in Bank South Pacific and Credit Corporation which contributed K68.5 million, flows came from dividends from interest payments on loans and from profit income.

“And all that combined to the K205 million that the Fund recorded,” he said.

The audited annual report will be published and the members’ statements will be issued starting next week.