Petronas Gas Bhd is one of the Employees Provident Funds largest investment companies, the Dewan Rakyat heard today.

Deputy Finance Minister Chan Kong Choy said nine others are Sime Darby Berhad, Telekom Malaysia Bhd, YTL Corporation Bhd (YTL Corp), RHB Capital Bhd, Malayan Banking Bhd, British American Tobacco, Commerce Asset-Holdings Bhd, Tenaga Nasional Bhd and Malaysia International Shipping Corporation Bhd (MISC).

Chan was answering a question by Wan Nik Wan Yusoff (PAS-Bachok) who asked the ministry to state EPFs 10 biggest investment portfolios.

Wan Nik also wanted to know whether EPFs involvement in the KLSE has somehow influenced the investment climate through the stock market.

Chan conceded that there is an effect, and a positive one at that.

EPF as one of the biggest funds in the country with about eight percent market capitalisation in the Kuala Lumpur Stock Exchange, will definitely influence the local share market.

The existence of long-term investors such as EPF has a positive effect to strengthen market sentiments to attract more local and foreign investors, he said.

Lowest in 38 years

The fund has recently come under fire from various political, labour and consumer groups for its recently announced five percent dividend  the lowest in 38 years. The gross income for 2001 was also lower at RM9.01 billion compared with RM10.2 billion for 2000.

The Malaysian Trades Union Congress (MTUC) demanded an explanation for the categorising of RM1.141 billion of the funds investments as doubtful loans.

MTUC secretary-general G Rajasekaran said this category, which has increased from the RM754 million for 2000, had contributed to the poor performance over the past few years.

For 2000, it was a six percent dividend, the lowest ever in 25 years. More than a quarter of the total doubtful loans, estimated around RM500 million, was used to rescue the ailing telecommunications company Time dotCom Bhd through a purchase of 78.7 million shares, said Rajasekaran.

In a report by The Sun last April, the government explained that the RM500 million was the unpaid portion of the companys borrowings of half a billion ringgit from EPF in 1996.

When contacted today, Rajasekaran said the decision was not prudent at all, especially since EPF went in knowing that it was lending contributors money to a loss-making company.

ERA Consumer Malaysia president N Marimuthu, exasperated by the declining dividends and lame excuses offered by the EPF, wants the entire investment panel replaced with a new team.

N Siva Subramaniam, president of Cuepacs, the largest public sector union, called for EPFs investment policies to be reviewed with focus on overseas investment opportunities.

He said if EPFs investment policies were not reviewed, the dividend will go down next year, too.

On Jan 27, Abdul Halim announced that EPF will invest more in the local share and bond markets from the current RM42 billion to about RM50 billion to enhance yield on the savings for its 10 million contributors.