By RONALD TOITO’ONA
The Solomon Islands National Provident Fund (SINPF) has revealed a mixed financial performance for the 2023-2024 financial year, when the Chief Executive Officer (CEO) and General Manager, Michael Wate provided an in-depth overview of the fund’s financial and operational performance for the fiscal year ending 30 June 2024.
Speaking during the occasion to announce the crediting rate for all NPF members this week in Honiara, Wate said the fund reported a significant gross income of $252.2 million.
However, he added this was a notable decrease from the previous year’s income of $354.7 million.
Wate’s presentation also emphasized several key financial aspects that contributed to the fund’s performance outcomes for the 2023-2024 financial year.
Key Financial Highlights
1. Gross Income Decline:
– The fund’s gross income fell primarily due to a sharp reduction in equity fair value revaluation gains, dropping from $147.3 million in 2023 to just $35.8 million in 2024.
2. Operating Surplus:
– After accounting for operating and member expenses of $108.8 million, the fund reported an operating surplus of $143.4 million available for member crediting.
3. Dividend Income:
– Total dividends received decreased to over $114 million, down from $123.2 million in 2023, attributed to foreign exchange fluctuations and policy changes among equity investment companies.
4. Interest Income Surge:
– Interest income from government debts rose by 47%, totaling $25.8 million. This growth indicates the increasing importance of government securities in the fund’s investment strategy.
5. Property Income:
– Rental income remained stable at around $34 million, with key property earners being the ASB and executive apartments.
Membership Growth and Contributions
Formal Membership Increase: The fund welcomed 6,644 new formal members, marking a 13% increase from the previous year. The total membership now stands at 152,047.
Contribution Growth: Contributions from employers and formal members rose slightly to $382 million, reflecting the ongoing economic recovery.
Member Benefit Payments
Payouts: A total of 7,554 benefits were paid out, amounting to $342.2 million. This is a slight decrease in both the number and value of payouts compared to the previous year.
Informal Sector: youSave Program
The youSave Membership: The informal sector program saw 6,132 new members, bringing the total to 43,768. Gross savings reached $88 million, indicating strong growth in this area.
Investments and Asset Management
Liquidity Position: The fund’s cash and equivalents rose to $213.7 million, earmarked for potential new investments.
New Investments: Significant investments were made, including a $10 million term deposit for Solomon Finance and a $25 million loan for Solomon Airlines to support tourism.
Asset Value: The fund’s net asset value increased by 5.5%, reaching $4.2 billion, driven by positive investment performance.
Future Outlook
Meanwhile, Wate expressed optimism about the Solomon Islands’ economic recovery, noting improvements in the Sovereign Credit Risk Rating, which is expected to benefit the fund’s future performance.
However, he acknowledged ongoing global economic volatility and emphasized the board’s commitment to maintaining strong crediting rates for members.
He also thanked various stakeholders, including government officials, board members, and international partners, for their support in navigating the challenges faced by the fund.
The SINPF’s financial performance in 2024 shows a mix of challenges and growth prospects within a changing economic environment.
According to Wate, as the fund strategically adapts and invests, it seeks to ensure a stable financial future for its members and support the wider economic recovery of the Solomon Islands.
Click here to read the Overview Of The Funds Financial And Operational Performance For The 12 Months Period Ending 30 June 2024 by Mr Michael Wate.