THE latest Auditor-General’s report did not factor in profits generated from interest on the Employees Provident Fund (EPF) shares, says Finance Minister II Datuk Seri Amir Hamzah Azizan.
He told the Dewan Rakyat that when interest is included, the fund remains in a positive operating position.
Amir explained that because profits are accounted for after deducting interest costs, the subsidiaries reported losses for 2023.
According to the AG report, nine EPF subsidiaries incurred RM76.51mil in losses in 2022, with losses increasing to RM224.21mil in 2023.
The subsidiaries and their reported losses for 2023 are KWASA Europe S.a.r.l., which recorded RM158.42mil in losses, followed by Ameen Direct Equity I, L.P (RM25.61mil), KWASA Europe-I S.a.r.l. (RM14.40mil), Naungan Sentosa Sdn Bhd (RM11.88mil), Kwasa Utama Sdn Bhd (RM8.61mil), YTW Harta Sdn Bhd (RM2.70mil), Kwasa Singapore Duo Pte Ltd (RM1.36mil), PPNK - Harta Sdn Bhd (RM840,000) and Common Icon Sdn Bhd (RM390,000).
Despite these losses, Amir emphasised the strong market value of EPF’s assets, as KWASA Europe S.a.r.l. currently holds a market value of €2.45bil, 26% higher than its initial acquisition price of €2.18bil.
“The same goes with Kwasa Utama, with a real estate value of RM433.13mil, exceeding its investment cost of RM370.20mil.”
For Naungan Sentosa Sdn Bhd, Amir said EPF has taken steps to raise footfall and occupancy rates at the Lalaport shopping complex.
Meanwhile, the Kwasa Singapore Duo Pte Ltd investment includes a hotel component within Guoco Tower, Singapore, along with residential and commercial components under Kwasa Singapore Solo Pte Ltd and Kwasa Singapore Trio Pte Ltd.
For 2023, Amir reported that EPF recorded returns of RM16.28mil in interest and RM19.16mil in dividends.
“Its fair value of investment is higher, amounting to RM998.71mil compared to the investment cost, which covers the cost of capital and shareholder loans amounting to RM801.26mil,” added Amir.
