KUALA LUMPUR: The Retirement Fund Inc (KWAP)'s reported a RM9.7 billion net income in 2023, its second-highest since its inception in 2007,said KWAP chief investment officer Hazman Hilmi Sallahuddin.

He said net income jumped from RM263 million in 2022.

"In 2022, we had inflation that led to the revision of rates and people thought there was a recession. The number is so much smaller compared to 2023 because of the unrealised losses in our local and global exposure," he said after announcing the the financial year 2023 results here today.

The public services pension fund reported a total fund investment return of 8.2 per cent in 2023.

KWAP's fund size grew 7.4 per cent to RM169.8 billion in the financial year ended December 31, 2023 from RM158.1 billion in 2022. 

Chief executive office Datuk Nik Amlizan said a large portion of KWAP's fund is still invested in the public equitymarket.

As at December 2023, KWAP remained a key investor in Malaysia with a total of 75.6 per cent of assets invested in Malaysia, while only 24.4 per cent divested in international market.

The total investment assets comprising 87.7 per cent or RM149 billion of public investment and the remaining 12.3 per cent or RM20.8 billion in private investment.

For the fiscal year 2023, the asset allocation (AA) of KWAP outlined a distribution encompassing 47.9 per cent in public equity, 35.5 per cent in fixed income, 5.3 per cent in real estate, 4.8 per cent in private equity, 2.1 per cent in infrastructure, and the remaining 4.4 per cent in money market.

"Bulk of that investment belongs to the public market, mainly equity which performed quite well last year compared to negative performance in previous year," she said.

Moving forward, Hazman said KWAP aims to increase its foreign investment to 30 per cent and also to double private market exposure to slightly above 20 per cent.

He also expects net income to moderate to around RM5 billion to RM6 billion as per its track record, and targets a long-term sustainable investment return of 7.0 per cent annually.

"Given the current sentiment improvement in forex (foreign exchange) market, we do think that we can only achieve that in the next one or two years. We hope that this year will be better compared to 2023, mainly driven by the domestic market.But having said that, in the long run, I think our strategy remains that we want to have a balanced exposure," he added.

https://www.nst.com.my/business/corporate/2024/07/1084328/kwap-reports-rm97b-net-income-2023-second-highest-inception