Taspen shifts investment to stocks

JAKARTA. State-owned pension insurance firm PT Taspen expects its old-age savings (THT) program to generate Rp 4.6 trillion (US$474.23 million) in investment yields this year, supported by a higher portion of investment in stocks in the capital market.

In 2013, Taspen is looking to invest up to Rp 48 trillion in THT funds, a 6.7 percent increase from 2012, according to Taspen investment director Taufik Hidayat. “This year’s YOI [yield-on-investment rate] is expected to stand at 10.1 percent. Last year, the rate was 10.14 percent,” he said.

The THT investment will remain dominated by bonds at 68 percent, followed by stocks at 25 percent and time deposits at 7 percent. In bonds, the firm will continue to focus on corporate bonds, while in stocks, it will invest only in the stocks of big cap firms.

This year Taspen decided to increase its portion of investment in stocks and reduce those of bonds and time deposits. In 2012, the THT investment portfolio was made up of bonds at 73 percent, time deposits at 16 percent and stocks at 11 percent. The investment shift was caused by the current low yields offered by bonds and time deposits, according to Taufik.

Taspen hopes to gain Rp 3.8 trillion in yields from its pension funds investment this year. It is estimated that the investment figure will climb 17 percent to Rp 62 trillion from 2012.

Contrary to THT, Taspen was only able to invest the pension funds in government bonds and state banks’ time deposits, Taufik said.

Taspen collects both the THT and pension funds from state workers’ salaries. Every month, 3.25 percent and 4.75 percent of their paychecks are deducted for the THT and pension funds, respectively.

Taspen finance director Tri Lestari said the firm planned to disburse around Rp 64.7 trillion of retirement funds in 2013. Last year, it channeled Rp 59.5 trillion to 2.5 million beneficiaries across the country. “The beneficiary number grows by between 50,000 and 100,000 people every year,” she said.

According to Tri, the firm’s profits declined 10.8 percent to Rp 446 billion in 2012, based on its unaudited financial report. The decrease was attributed to its lower actuarial rate.

“Last year, we reduced the rate to 9.8 percent from 10 percent in 2011. We will continue to reduce it gradually to reach the market’s rate,” she said.

Actuarial rates are an estimate of the possible future loss to a pension fund. It is based on previous losses under similar circumstance. The market’s average rate is above 7 percent.

As of December 2012, Taspen’s total assets amounted to Rp 123 trillion. Its liabilities reached Rp 117 trillion and its equities stood at Rp 6 trillion. (Tassia Sipahutar/ The Jakarta Post)