Monday, September 20, 2021

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Pandemic knocks over 14% off value of Social Security Fund


The Covid-19 crisis has wiped more than 14 per cent off the value of the Social Security Fund (SSF)'s investment portfolio. The fund plays an important role in the Thai stock market, investing over Bt2 trillion in 69 companies.

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However, since July its portfolio has dropped 14.9 per cent to Bt2.19 trillion, according to the fund’s latest financial report on Monday (September 21).

Meanwhile, the SFF is also being criticised by netizens for holding a large stake in Phuket’s Sri Panwa Hotel amid claims it encroaches on forest reserves, and public anger at hotel owner Vorasit Issara for criticising pro-democracy protesters.

On June 30, 68 per cent of the SFF was in government bonds and 12.09 per cent in Thai stocks. The fund has a policy to invest 80 per cent in safe-haven assets and 20 per cent in volatile assets.

The fund realised gains of Bt23 billion in the first half of this year – Bt21 billion from interest, debt instrument sales and asset borrowing fees, and Bt2.7 billion from dividends and equities and investment unit sales.

Of the SSF’s stock investment, 8.08 per cent is in PTT (worth Bt19.1 billion), 7.76 per cent in Siam Cement (Bt18.3 billion), 6.16 per cent in Advanced Info Services (Bt14.5 billion), 5.45 per cent in CP All (Bt12.9 billion) and 5.25 per cent in Airports of Thailand (Bt12.4 billion).

The fund also recently invested Bt5.57 billion in other five companies – Central Retail Corp, Srisawad Corp, CH-Karnchang, Amata Corp and CPN Retail Growth Leasehold REIT.

The SSF focuses on Thai holdings, investing just 3.28 per cent in foreign equities.

Passakorn Linmaneechote, deputy managing director of Kasikorn Securities, explained SSF’s investments had dropped partly because the fund had to sell assets to pay unemployment compensation to people who lost jobs during the pandemic.

It was also driven down because the price of Thai stocks was high compared to foreign stocks, he said.

He considers the fund’s 3 per cent foreign investment level to be low.

“If they want to increase investment in foreign assets, they have to set up a team to manage risks from foreign investment which may take a long time," he said.

In Malaysia, some funds took five to 10 years to set up a team to monitor foreign investments, he added.

Published : September 23, 2020

By : The Nation