By IAN M.KAUKUI
THE Solomon Islands National Provident Fund (SINPF) on Wednesday announced a credit rate of 3.7% to its members’ contribution for the 2020 financial year, a less of 2.1% from last year which is 8.5%.
This means a total of $95million will be credited to members’ accounts after Wednesday’s announcement.
SINPF Board Chairperson Dr. Jimmy Rogers when announcing the interest rate said the Board when considering the 2020 appropriate interest rate took into account the Board’s crediting and reserving policies.
Dr. Rogers said the crediting policy requires the Board to consider the following;
- The investment return after deducting for all board and operational costs;
- The Board’s investment objectives;
- The reserving requirement of the Fund;
- The Fund’s code of conduct; and
- The minimum statutory 2.5% crediting rate as specified in section 8 of the NPF Act.
He said it has been difficult determination for my Board to consider the 2020 members crediting rate in light of the ongoing uncertainty and risks surrounding COVID-19 and how long the pandemic will take to resolve.
“But with care, prudence and fairness to members, my Board today (yesterday) has considered and agreed to declare a crediting rate of 3.7% for its members. This means a total of $95million will be credited to members’ accounts after today’s (yesterday) announcement,” he said.
Dr. Rogers said after this crediting the Fund’s required reserving levels are still maintained above the Board’s minimum policy thresholds of CBSI 7.5% tier 1 capital ratio and at least 3 years of 2.5% crediting interest guarantee.
He said though the crediting rate has already been made, the SINPF accounts are still in the process of being audited.
“Furthermore, the financial overview of the Fund’s performance draft financial accounts showed that this year’s crediting rate determination has been challenging due to the potential large unrealized losses arising from unlisted equities,” he said.
Meanwhile, in his declaration speech yesterday, he also announced an increase Special death Benefit (SDB) amount of $7,500 for the current financial year, an increase of $1,500 compared to last year which was only $6,000.
“This is to at least contribute to meeting part of the funeral expense of members who have passed on,” he said.