Kuala Lumpur, Mar 5 (IANS): Malaysia's pension fund, the Employee Provident Fund (EPF), recorded a lower total gross investment income in 2022, due to high market volatility and lower valuations across equity and fixed income markets.

The EPF said in a statement on Saturday that its total gross income in 2022 fell 19.68 per cent to 55.33 billion ringgit ($12.36 billion) from 68.89 billion ringgit in 2021, Xinhua news agency reported.

The equities asset class contributed 30.54 billion ringgit or 55 per cent of the EPF's total gross income, compared to the 41.06 billion ringgit recorded in 2021. Foreign listed equities, which yielded a return on investment (ROI) of 9.27 per cent, continued to be the driver of returns for this asset class.

Income from its fixed income portfolio contributed 18.19 billion ringgit or 33 per cent of the EPF's total gross income. The lower income compared to 2021 can be attributed to lower capital gains driven by increasing yields.

The real estate and infrastructure portfolio's income of 5.56 billion ringgit continued to play a role as a hedge against inflation, recording an ROI of 10.5 per cent.

According to the EPF, the financial year 2022 was marked by both slower global growth and high inflation rates, compounded by the tightening of monetary policies by major central banks to reel in inflationary pressure.

"We anticipate that the 2023 investment climate will continue to be challenging in the short and medium-term. The continuing uncertainty underscores the need for a thoughtful approach that focusses on building resilience while aligning with EPF's long-term investment objectives in accordance with our strategic asset allocation," said its Chairman Ahmad Badri Mohd Zahir. (1 ringgit equals 0.22 US dollar)