SINPF pays out 10% interest to members

THE Solomon Islands National Provident Fund (SINPF) is paying out another 10 per cent interest rates to its members.

This was the same rate it paid to its members at the end of the last financial year.

Yesterday, Finance minister Snyder Rini announced another 10 per cent pay-out, while declaring a profit of $276 million.

At the same time, the NPF board agreed for the Special Death Benefit (SDB) to be paid to any deceased members will be at $3,000 as an interim measure until the NPF Act Review is passed by Parliament.

Mr Rini said in monetary terms, the crediting rate just announced is equivalent to $209 million in interest, allowing $67.1 million to be ploughed back to the General Reserve to $516.6 million from $450 million last year.

In 2015, NPF had also declared 10% to members’ contribution which totaled $187.5 million.

“This interest amount will be distributed to members with credit balances commencing next week,” Mr Rini said.

“The interest amounts earned will be credited to members’ Contribution Accounts being held and managed by the Fund,” he added.

Mr Rini said the result of crediting interests will bring the members’ total accumulated contribution balance to approximately $2.6 billion from $2.3 billion in the last financial year ending 30 June 2015.

“This is an increase by 8%,” he explained.

 “To illustrate how a member calculates how much will be credited to his or her Contribution Account with the Fund: if a member has a contribution balance of $100,000 at the end of the previous year 30th June 2015 and at 10% interest declared today, that member has earned $10,000,” he said.

Mr Rini said that amount will be credited to his or her account as from 1st July 2016.

“Thus, the member’s total contribution balance with the Fund will reach $110,000,” he added.

Moreover, Mr Rini said the overall financial performance of the Fund during the year is above expectation but at the same time it was a challenging period.

He said the improved financial performance by the Fund during the period was driven on the back of its domestic investment assets which include: equities, commercial properties, loans, and government securities.

“On the downside however, the Fund has experienced low performance outcomes from its offshore investments as a result of the general weakness in the global economy which has prevailed over the period,” he said.

Mr Rini said in this connection, the Fund has achieved a profit of $276 million from $98 million in year 2015.

He said despite of the challenging economic environment, this is an increase of about 64% that led the Fund to the financial outcomes during the financial year ending 30th June 2016.

In 2013, the crediting rate added to members’ contribution balance was 20 percent, the highest interest NPF has ever paid.

In 2014 it dropped to 15 percent, and reduced again to 10 percent in 2015.

Source: Solomon Star/Solomon Today Post