ENPF INVESTMENT INCOME UP BY 85.9 %

MBABANE – During the financial year 2022/23, the Eswatini National Provident Fund (ENPF) saw a healthy year-on-year increase in investment income after the payment of investment management fees.

As such, the fund’s investment income increased from E319.8 million in 2022 to E594.6 million in 2023, which translates to an increase of 85.9 per cent. According to the ENPF annual report for the said year, this led to the fund’s overall performance in 2023 being favourable compared to the previous year.

As such, the operating surplus for the year was E446.4 million compared to the E192.8 million recorded last year. This was the highest surplus to have been recorded by the fund in six years. “This performance can be attributed to a better economic recovery post the COVID-19 pandemic, with the investment climate better than in the previous year and business recovery is also on the upward trend,” read the report in part.

The fund’s primary investment objective is to achieve a one-year growth rate that exceeds CPI and over periods of three years and longer to earn a return of CPl + 5 per cent as inflation was brought under control during the second half of the reporting period, these targets became achievable.

Equities

The fund ended 2023 with a year-on-year growth of 10 per cent against an annual average CPI rate of 5.69 per cent. Local and global equities outperformed the target of CPl + 5 per cent and contributed to this positive trend. Due to tight expense control, diligent debtor compliance management and significant sector diversification, the fund’s investment properties have performed much better than most investment properties in Eswatini and the region.

ENPF’s gross rental revenue increased by 1.6 per cent from E50.9 million in 2022 to E51,8 million in 2023, on the back of an improved average occupancy rate, especially in residential properties. The fund reported that it has continuously ensured that its resources  were used effectively, efficiently and economically despite its continuing growth.

The fund has constantly kept its operating expenses below 5 per cent of members’ funds. Total expenditure has been continually kept stable across the five-year period. There was a slight increase noted in 2020 when the fund engaged in a voluntary exit exercise and further donated towards the government COVID-19 laid-off relief fund.

The fund’s operating costs refer to a wide range of functions; investment management fees, fund operational and member-related activities, Board expenses and support services such as human resources, IT, legal, risk and compliance and property expenses.

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