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Tuesday, 10 January 2017

(The Edge Financial Daily) PNB sticks to domestic investment in 2017

(Subtitle) Nevertheless, the scale of its international ventures is likely to grow in time
BY ADAM AZIZ

KUALA LUMPUR: Permodalan Nasional Bhd (PNB) will continue to focus on domestic investment in 2017 particularly in equities, on the back of expectation of stability returning to the market this year.

Nevertheless, the scale of its international ventures is likely to grow in time, PNB chairman Tan Sri Abdul Wahid Omar said.

“At the moment our investment in international property and equity accounts for only 2% of our total portfolio. From time to time, we do look into diversifying our overseas investment.

“I think in time the number will increase, but the bulk of our investment will remain in Malaysia. Our unitholders would like to see more investment in the Malaysian econ-
omy,” Abdul Wahid said.

Abdul Wahid spoke to the press yesterday after a ceremony to appoint AmBank Group Bhd as an official agent of Amanah Saham Nasional Bhd (ASNB).

Currently, the nation’s biggest unit trust fund is highly dependent on the local economy, with 98% of its funds invested in the domestic market, most of which is funnelled into the nation’s stock market.

One of ASNB’s core products, Amanah Saham Bumiputera (ASB), paid its unitholders a 6.75 sen dividend and a bonus of 0.5 sen per unit for the financial year ended Dec 31, 2016 (FY16), the lowest since FY09.

Nevertheless, ASB outperformed the country’s equity market which recorded a negative total return of 1.7% in the same period.

“2016 was challenging for Malaysia’s equities market, but we expect corporate earnings to recover in 2017,” he added.

“We are currently managing more than 212 billion units in circulation owned by some 12.9 million unitholders. Last year alone, we paid a total of RM13.86 billion worth of income distribution. That’s actually the challenge that we have to follow through.”

“We have currently some RM260 billion under our management, which is made up of RM220 billion worth of public money and another RM40 billion ringgit of our own fund,” Abdul Wahid said.

With the appointment of AmBank as ASNB’s eighth official agent, the unit trust fund said it does not plan to add more agents in the near term. The collaboration will bring the number of ASNB’s agent branches to 2,200, which Abdul Wahid said should be sufficient.

Under the collaboration, AmBank will offer all 12 of ASNB’s products through its 175 branches nationwide.

The bank is also only the third agent to offer ASNB-related investment through the Employees Provident Fund (EPF).

“With this appointment, AmBank is poised to expand a range of wealth and financial management products. This marks our first collaboration with ASNB and we hope to achieve more collaboration in the future with PNB and ASNB,” AmBank Group chairman Tan Sri Azman Hashim said.

“With AmBank, EPF Account 1 owners can invest up to 30% the existing amount in Account 1 into ASNB products,” AmBank retail banking managing director Jade Lee added.

Meanwhile, Azman declined to comment on the Australia and New Zealand Banking Group Ltd’s (ANZ) planned disposal of its stake in AmBank.

ANZ announced in November last year that it was en route to cease its retail and wealth operations in Asia to focus on institutional banking operations in the region.

The group was said to be weighing the sale of its 24% stake in AmBank after it was linked to financial irregularities found in 1Malaysia Development Bhd last year.

AmBank chief executive officer Datuk Sulaiman Mohd Tahir said in December that the group had not received anything official from ANZ regarding the rumoured disposal.