Nine percent interest for PNG National Superannuation Fund members

(L-R) Chief Financial Officer Debbie Oli, Chairwoman Tamzin Wardley and Chief Executive Officer, Rajeev Sharma (PHOTO: Nasfund)

Papua New Guinea’s National Superannuation Fund (Nasfund) Trustee Board has approved a nine percent increase on members crediting rate for the financial year of 2023.

This will result in a distribution of more than K584 million (US$115 million) into the accounts of more than 680,000 members’ accounts on the weekend.

The fund have also allocated an interim credit rate amounting to K9.4 million (US$2.49 million) to members that have exited the fund during the year.

Nasfund chairman Tamzin Wardley said that despite the difficult time that the country was going through, the fund’s resilience and ability to surpass expected levels in contribution, cash income and drive operational cost management were the highlight of the fund.

“It is wonderful to announce this positive news, in what has been a difficult time for many,” she said.

“The positive financial outcomes were significantly influenced by key factors such as above budget performance in cash income, and valuation gains of K180 million (US$47.83 million), a substantial improvement compared to the loss of K44 million (US$11.69 million) last year.

“Additionally, a net foreign exchange gain of K85 million was recorded, in contrast to a loss of K40 million (US$10.6 million) in prior year (2023),” Wardley said.

She added that these factors had contributed to a total valuation gain of about K265 million (US$70 million) which equates to 4.08 per cent of the nine per cent rate to the members this year.

Wardley said that this crediting rate of 9 percent in 2023 underscores the fund’s commitment to providing strong and stable returns for its members above the consumer price index (CPI) in the next five years, which average is 6.12 percent compared to 4.92 percent CPI average over the same time from 2019 to 2023.

Meanwhile, chief executive officer Rajeev Sharma said the decision was done to ensure the financial well-being and confidence of members as the fund was looking forward to a positive trajectory over the long term.

He said the 9 per cent result this year comes from overall gross return of 11.2 percent.

Out of this expenses and tax account for two percent, 4.08 percent came from international equity, BSP dividend and growth contributed 2 per cent and the rest came from interest on Government securities and property rentals.