The Solomon Islands National Provident Fund (SINPF) members can expect an increase in their balance as of yesterday after the declaration of a 20-percent interest rate to members’ contribution worth $246.2 million (US$33.7 million).
This was a highest payout ever made by the fund.
Minister of finance and treasury Rick Hou officially made the announcement on Friday saying the crediting rate of 20% is equivalent to $246,119,460 in interest which will be credited to each member’s contribution balances as of July 1st. .
This payout will also expand members total contribution balance with the fund from $1.3 billion to just under $1.6 billion, he said.
“To illustrate this, if a member has a contribution balance of $50,000 recorded in his or her account at the end of the previous year on 30 June 2012, at 20% interest his or her account will increase by $10,000 as from 1 July, 2013.”
Minister Hou also announced that the special death benefit (SDB) will also increase from $6,000 to $10,000 as of yesterday.
Hou highlighted that the 20% crediting rate is yet another milestone in the Fund’s performance surpassing the previous highest crediting rates of 18% in 2007 and 2008.
He congratulated the NPF chairman, his board, management and staff of the fund for the impressive achievement of crediting members’ contribution balances at 20% for this financial year.
The finance minister also assured the SINPF board and management that his ministry and the national government will continue to defend the independence of the fund as the government recognizes the importance of the fund to the stability of the country’s financial system and economy.
“The reform of the SINPF Act is absolutely necessary with the government strongly supporting the reform.
“It will be a new standalone act placing the Central Bank of Solomon Islands to regulate and supervise the fund, improving governance and transparency of the fund’s administration and operations.
“The investment decision making process will be removed from my (Minister’s) powers and placed on the board of trustees of the fund with oversight from the Central Bank of Solomon Islands,” Mr Hou said.
Chairman of the SINPF board, Baoro Laxton Koraua described the 2013 financial year as simply ‘outstanding.’
“The 2013 financial year has been an outstanding one for the fund as our members’ investments portfolio is expected to reach more than $2.5 billion at the end of 30 June 2013.
“This significant increase is driven by the large revaluation gains of our two large equity investments in South Pacific Oil Limited (SPOL) and Solomon Telekom Company Limited and other investment properties.
“As a result of these positive unrealized capital gains, the board has reflected part of these gains in this year’s crediting rate of 20% translating to a total of more than $246 million in interest.
“These will be applied to our members contribution balance as from 1 July, 2013,” Koraua explained.
Koraua summed up by thanking all important stakeholders, the government, employers and unions and all service providers for the continuous support rendered to the Fund during the year.