2023 Highlights:
- 7.4% growth of total fund size
- Recorded a net income of RM9.7 billion
- Attained a total fund investment return of 8.2%
- 75.6% of KWAP’s portfolio focused domestically
- RM3 billion withdrawals from KWAP fund used to partially finance Government’s pension liabilities
KUALA LUMPUR, 31 July 2024 – Kumpulan Wang Persaraan (Diperbadankan) [KWAP] today announced strong financial results for the year ended 31 December 2023 (FY2023), showcasing the success of its investment and corporate strategies in delivering both financial and social values to its stakeholders. For the financial year 2023, KWAP fund size grew from RM158.1 billion in 2022 to RM169.8 billion in 2023, marking a 7.4% growth and keeping KWAP on track to achieve its TERAS 5 goals by the end of 2024.
After taking into account withdrawals totalling RM3 billion of KWAP fund used to partially finance the Government’s pension liabilities, the net increase of RM11.7 billion year-on-year reflects the organisation’s continued dedication to prudently manage assets and optimise investment returns to serve its mandate. This reinforces KWAP’s position as Malaysia’s largest public sector retirement fund for civil servants.
The fund’s performance is further highlighted by net income of RM9.7 billion, a significant increase from RM263 million in 2022. Further to this, KWAP delivered a strong total fund investment return of 8.2% for the year.
For respective asset classes, KWAP’s public equity investments recorded a Time Weighted Rate of Return (TWRR) of 11.0%, private equity portfolio delivered a TWRR of 7.9%, fixed income portfolio achieved a TWRR of 6.2%, infrastructure portfolio attained a TWRR of 5.2%, and real estate obtained a TWRR of 3.5%. The solid performance reflects the effectiveness of KWAP’s investment strategies and asset allocation decisions.
In line with the Government’s MADANI Economy agenda to spur domestic investments, KWAP has remained a key investor in Malaysia with a total of 75.6% of KWAP’s investment assets invested in Malaysia, while only 24.4% divested in international market. From the total investment assets, public investment made up 87.7% or RM149 billion and the remaining 12.3% or RM20.8 billion in private market.
Additionally, with the announcement of various MADANI economic drivers, including the National Energy Transition Roadmap and New Industrial Master Plan 2030, KWAP has dedicated its efforts to thorough investment planning and strategy formulation to be inclusive in our approach to growing KWAP fund sustainably. For the fiscal year 2023, the Asset Allocation (AA) of KWAP outlines a distribution encompassing 47.9% in public equity, 35.5% in fixed income, 5.3% in real estate, 4.8% in private equity, 2.1% in infrastructure, and the remaining 4.4% in money market.
The contributions amount received in 2023 of RM2.7 billion were from three main sources: Federal Government Contributions, Government Shares, and Employer Contributions. The latter included contributions from statutory bodies, local authorities, and secondment agencies.
Aligned with the MADANI initiative to create new economic opportunities, KWAP has committed to strengthening Malaysia’s venture capital (VC) ecosystem through the Dana Perintis initiative launched in 2023. With a total of RM500 million allocation, this effort aims to accelerate growth within the Malaysian entrepreneurial landscape, empower early-stage companies, drive innovation, and enhance economic resilience.
Chief Executive Officer of KWAP, Datuk Hajah Nik Amlizan Mohamed, said, “KWAP’s notable performance in 2023 builds on our strong track record in meeting both our financial and social objectives. These results validate the effectiveness of our investment model to generate sustainable returns for our stakeholders. We are also structuring our investment effort and initiatives around MADANI framework, and this approach allows us to deliver positive returns for our beneficiaries while contributing to Malaysia’s sustainable development. Our continued success affirms KWAP’s financial strength and demonstrates our commitment in creating long-term value for our pensioners and the country as a whole.”
Additionally, KWAP has been awarded the unqualified audit opinion for the FY2023 financial audit by Ketua Audit Negara and is preparing to introduce its first integrated annual report.
Other Notable Achievements for the Year 2023
On retirement services, up until 31 December 2023, KWAP served 790,772 pension recipients throughout Malaysia with a breakdown of 73% of pensioners and 27% of derivative recipients. This represents a 2.8% increase, or 21,825 additional pension recipients, compared to the year 2022. Despite the increase of pension recipients in 2023, SLA Performance for pension services achieved an annual weighted score of 99.4% in 2023, surpassing the Performance Threshold of 95% as set in the service-level agreement (SLA) with JPA.
In addition to its financial and operational accomplishments in 2023, KWAP remained resolute in its unwavering dedication to effecting positive change beyond its investment activities.
KWAP has implemented a range of targeted initiatives to enhance the well-being of pension beneficiaries and foster direct engagement with pensioners. These initiatives include:
- Jelajah MyPesara: Initiated in 2023, this is a series of educational seminars focusing on financial planning, healthcare, and entrepreneurship.
- Karnival MyPesara: An annual event showcasing various aspects of active and productive ageing for current and future pensioners.
- Anugerah MyPesara: An award programme recognising active pensioners who continue to make significant contributions to society.
Furthermore, KWAP conducts regular pensioner visits to stay informed about their changing needs and to maintain direct engagement with the pensioners.
Moving Forward
“With clear purpose and determination, we persistently elevate our effort to enhance the retirement experience for our pensioners by introducing a diverse array of meticulously curated initiatives and activities tailored to their needs. Although pension reform has been discussed albeit at its nascent stage of implementation, it presents a new dynamic within the national context and pension ecosystem. We at KWAP will play our role to efficiently and effectively ensure that our pension system remains robust and responsive to the evolving needs of our pensioners. Aligned with our guiding principle encapsulated in the tagline, “Your Retirement Companion”, we will remain steadfast in our commitment to fostering a more fulfilling retirement journey for Malaysian pensioners,” added Datuk Hajah Nik Amlizan.
For more information about KWAP, please visit www.kwap.gov.my.
—ENDS—
About Kumpulan Wang Persaraan (Diperbadankan)
Kumpulan Wang Persaraan (Diperbadankan) [KWAP] or the Retirement Fund (Incorporated) was established on 1st March 2007 under the Retirement Fund Act 2007 (Act 662) replacing the repealed Pensions Trust Fund Act 1991 (Act 454).
KWAP manages contributions from the Federal Government and relevant agencies made into the Retirement Fund [Fund] to obtain optimum returns on its investments through sound management and investment of the Fund in equity, fixed income securities, money market instruments, and other forms of investments as permitted under the Retirement Fund Act 2007 (Act 662). The Fund shall be applied towards assisting the Federal Government in funding its pension duties. In 2015, KWAP was officially appointed as an agent of the Federal Government for the purpose of payment of pension, gratuity, and other benefits granted under any written law from the Consolidated Fund as agreed between the Federal Government and KWAP.
Visit www.kwap.gov.my for more information.
For media enquiries, please contact:
Amirah Kamarulzaman
Contact number: +603-2174 8000
Email: nurulamirah.k@kwap.gov.my
Yasmin Syazwina
Contact number: +6016-973 7956
