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Hong Kong Pension Fund MPF Total Assets Grew to $156 Billion, Annualised Return of 5.1%

10th September 2021 | Hong Kong

Hong Kong retirement fund MPF (Mandatory Provident Fund) total assets had grew to $156.9 billion (HKD 1.22 trillion) at the end of June 2021, representing a year-on-year increase of 26%.  The Hong Kong Mandatory Provident Fund (MPF) annualised net return is 5.1% p.a. since the inception of the MPF System in 2000, outperforming the inflation rate of 1.8%.  The total MPF assets have also increased 101% over the last 5 years.  The MPF System was set up to help Hong Kong’s workforce save up for their retirement.  Except for exempt persons, employees and self-employed persons aged 18 to 64 are required to join an MPF scheme, contributing 5% each from employee’s income and employer subject income tier (Min. HKD 7100 and Max HKD 30,000).  View: Hong Kong MPF June 2021 Report

” Hong Kong Pension Fund MPF Total Assets Grew to $156 Billion, Annualised Return of 5.1% “

 


Hong Kong MPF June 2021 Report

Hong Kong 4
Hong Kong, Asia’s leading financial centre

Key findings in the June 2021 issue of the Hong Kong MPF Statistical Digest Quarterly Report:

As at the end of June 2021, total MPF assets amounted to HKD 1.22 trillion, representing a year-on-year increase of 26%. Over HKD 460 billion of the total MPF assets was investment returns, net of fees and charges. Total MPF assets have increased 101% over the past five years. The annualized net return was 5.1% since the inception of the MPF System in 2000, outperforming the inflation rate of 1.8% over the same period. All MPF fund types posted positive annualized net returns.

In the second quarter of 2021, a total of HKD 3,789 million in voluntary contributions (VCs) was received, which was the highest level of VCs received on a quarterly basis. Compared with the second quarter of 2016, the quarterly amount of VCs received increased by HKD 1,421 million (or 60%) in the past five years. In terms of the share of total MPF contributions received in a quarter, VCs rose from 13.5% to 18.7% during this period, indicating an increasing recognition among employers and scheme members in making VCs on top of mandatory contributions to enhance the retirement protection of scheme members.

As at the end of June 2021, about 2.49 million MPF accounts had invested all or part of their assets according to the default investment strategy (DIS) or in the two constituent funds under the DIS, accounting for 24% of a total number of 10.35 million MPF accounts at the time. The total assets invested in the DIS amounted to about $77.8 billion, accounting for 6% of total MPF assets. Over the past year, the Core Accumulation Fund and the Age 65 Plus Fund, the two constituent funds under the DIS, registered net investment returns of 21.7% and 5.8% respectively.

In the second quarter of 2021, the total number of withdrawal claims for MPF on various grounds (including retirement and early retirement) was 60,200, a decrease of 10% compared to 66,600 in the first quarter of 2021. The number of claims for MPF on the grounds of permanent departure (PD) from Hong Kong in the second quarter of 2021 rose 4% to 8,000, compared to 7,700 in the previous quarter.

View: Hong Kong MPF June 2021 Report

 

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