Thursday, March 28th, 2019
WASHINGTON, March 28 — US economic growth was revised sharply lower for the final three months of 2018, down to 2.2 per cent rather than the 2.6 per cent originally reported, the government said today. The Commerce Department said the revision of…
KUALA LUMPUR: Permodalan Nasional Bhd (PNB) has identified six global fund managers for its international private equity investments and expects to begin deploying some of these investments by year-end.
“Selection has been approved by the board. As you know under equity investment, actual investment deployment takes between three and three-and-a-half years. We expect some of the deployment to start happening at the end of year,” said PNB president and group chief executive Datuk Abdul Rahman Ahmad.
Speaking to reporters at the announcement of PNB’s results today, Abdul Rahman declined to name the six global fund managers but assured investors that they are global private equity firms that are renowned to be best in their class and were chosen via a rigorous selection process.
The move is part of PNB’s strategic plan aimed at enhancing sustainable returns, which includes optimising asset allocation, boosting domestic public equity performance, increasing exposure in private equity and fixed income, rationalising and enhancing property investments, and diversifying into global assets.
“It is part of our strategy to increase asset diversification, not just geographically but also across other asset classes … part of the strategy to diversify our investments is to increase our exposure in private equity, fixed income and real estate. That is going to continue. Our investment in fixed income went up to 6.6% (as of February 2019) from 5.8% (as of February 2018),” he said.
Abdul Rahman said there is no particular target for each of the asset class, as it would depend on the opportunities available, market conditions and timing of investment but the asset diversification will be done gradually.
In terms of overseas investments, group chairman Tan Sri Dr Zeti Akhtar Aziz said, PNB will venture into international financial markets in developed economies as well as emerging economies that show potential for PNB.
“We will look at all these options to try and enhance our returns and also mitigate some of the risks that happens in different financial markets,” she said, adding that these markets include the US, Europe, the UK Australia, Japan and emerging economies within Asia and Europe.
Zeti noted that PNB has started diversifying into the domestic bond market, which has gained significant maturity.
“We will look at other asset classes, including Reits (real estate investment trusts) and so on in the domestic market. We have an investment committee that assess the proposals for investments in these different asset classes in a very rigorous and robust manner. We also apply very significant risk management practices on all the investment decisions,” she added.
In terms of engagement with its core companies and whether PNB will consider shedding some of these assets, Zeti said PNB as a responsible investor will not contribute to any disruptive movements in the domestic market or to its strategic investments.
For the financial year ended Dec 31, 2018 (FY18), PNB’s net income fell 4% to RM17.01 billion from RM17.71 billion in the previous year while gross income remained flat at RM20.31 billion from RM20.35 billion recorded in FY17.
Assets under management grew 6.9% to RM298.52 billion from RM279.23 billion in FY17 while return on assets stood at 6%, lower than the 6.7% achieved in FY17. Unit trust funds expanded to 13.8 million accounts across 14 funds while units in circulation rose 7.9% to 236.6 billion in FY18 from 219.3 billion in FY17.
PNB’s annual income distribution pay-out amounted to RM15 billion in FY18. It announced an income distribution of 6 sen per unit for Amanah Saham Bumiputera 2 and 5.50 sen per unit for Amanah Saham Malaysia.
The fund manager also announced an income distribution of 4.10 sen for ASN Equity 3, 4.20 sen for ASN Imbang 2 and 5 sen for ASN Sara 1.
KUALA LUMPUR: Efforts must be stepped up to address the issue of low wages faced by Malaysians workers, such as attracting the right investments to the country, upskilling the local workforce and reducing the reliance on foreign workers, Bank Negara Malaysia assistant governor Marzunisham Omar (pix) said today.
Clarifying that Malaysia did not experience a decline in productivity but is seeing slower growth in productivity, he said Malaysian workers have to increase their productivity and, at the same time, the country needs to ensure that its workers are paid fairly.
“We need to address this issue from several perspectives. First, the need to get our act together to attract the right kind of investments into our economy, both foreign and domestic, so that we can create jobs for Malaysians. In the past six to seven years, we’ve not been able to create the necessary number of high-skilled jobs to absorb the graduates coming into our economy every year,” he told reporters after a panel discussion at the Bank Negara Malaysia Governor’s Address on the Malaysian economy organised by the Malaysian Economic Association here.
“Second, we need to strengthen our education and the industry has to come together to assist in upskilling and reskilling our labour. Our industry must be committed to adopting more automation and reduce the reliance on low cost labour.
“As long as we have an unlimited supply of cheap foreign labour, we will continue to be reliant on the low cost model and this is not sustainable. This will not help us move to the higher value-added economy that we want. This will not help our workers to earn higher wages,” Marzunisham said.
He said reforms in the labour market in terms of law and rules and regulations are needed, and to encourage adoption of a more productivity-linked wage system. “The government is looking at making sure incentives are more targeted. No longer giving emphasis on blanket incentives.”
Alliance Bank Malaysia Bhd chief economist Manokaran Mottain concurred, saying that more concrete measures should be aimed at tackling the issue of foreign workers.
At almost full employment in Malaysia, wages should go up but this appears otherwise, he said, citing reasons of easy access to foreign labour. He suggested firms be given incentives to employ more locals.
Philip Capital Management senior vice-president (investment) Datuk Dr Mohd Nazri Khan said: “It’s an embarrassment for Malaysia. We have six million foreign workers and most of these foreign workers are not high skilled, unlike in Singapore where they are high end.”
NEW YORK, March 28 — Wall Street rose modestly today, as US-China trade talks made headway, but a cut in quarterly GDP growth exacerbated fears of an economic slowdown and kept a lid on gains. The domestic economy slowed more than initially…
KUALA LUMPUR, March 28 — PLUS Malaysia Berhad (PLUS) managing director Datuk Azman Ismail has been elected as president of the Association of Highway Concessionaires Malaysia (PSKLM) for the 2019-2021 term. In a statement today, PSKLM said East…
BEIJING, March 28 — The United States and China open the latest round of their trade talks today as the economic superpowers edge towards a deal to resolve a months-long spat that has rattled the global economy. The two-day meetings between US…
ANKARA, March 28 — Turkish President Tayyip Erdogan said today the central bank must cut interest rates or inflation will remain high, and he blamed the recent volatility in the lira on “attacks” by the United States and other Western…
LONDON, March 28 — Oil fell today after US President Donald Trump called for the Organization of the Petroleum Exporting Countries (Opec) to boost crude production to lower the price of the commodity. International Brent crude oil futures slid…
REYKJAVIK, March 28 — Iceland’s budget carrier WOW Air said it had ceased operations and cancelled all flights today, stranding thousands of passengers. The collapse of the troubled airline, which transports more than a third of those travelling…
PETALING JAYA: Berjaya Corp Bhd’s (BCorp) pre-tax profit for the third quarter ended Jan 31 surged more than sixfold to RM39.05 million from RM6.35 million a year ago underpinned by improved performances from the marketing of consumer products and services segment.
In a filing with Bursa Malaysia, the group said that the previous year’s corresponding quarter also recorded substantial foreign exchange losses and a loss on disposal of a subsidiary company.
BCorp said the improved performance in the marketing of consumer products and services segment was due to lower operating expenses recorded by the retail distribution business, following the closure of non-performing stores and reduction in operating expenses.
The motor distribution business also saw a higher pre-tax profit mainly from H.R. Owen Plc, which recorded higher sales in the new car sector.
The restaurants and cafes segment contributed higher profit during the quarter, driven by Starbucks and Kenny Rogers Roasters Malaysia’s operations.
BCorp’s revenue for the quarter fell 7.39% to RM2.01 billion from RM2.17 billion a year ago.
For the nine-month period ended Jan 31, the group recorded a pre-tax profit of RM232.5 million compared with a pre-tax loss of RM84.86 million a year ago due to higher operating profit and gain on disposal of DSG Holdings Ltd.
The pre-tax loss recorded a year ago was due to the provision for impairment of a portion of the balance sale proceeds for the sale of Great Mall of China Project, and loss on partial disposal of an associated company, which amounted to RM155.08 million and RM39.94 million respectively.
The group is expected to recognise an exceptional gain in the remaining quarter with the completion of the disposal of TPC Nghi Tam Village Ltd on March 1.