Tuesday, November 19

EPF expects 5.5 pct pa from special funding scheme

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KUALA LUMPUR: The Employees Provident Fund (EPF) is expected to gain a 5.5 per cent profit from its RM1.5 billion funding of the Special Funding Scheme for eligible tenants to purchase Kuala Lumpur City Hall (DBKL) houses.

Therefore, EPF would not lose money in the scheme, said Federal territories and Urban Well-being Minister Datuk Seri Raja Nong Chik Raja Zainal Abidin yesterday.

“The loan is very secure and EPF is getting a 5.5 per cent clean return per annum.

“At the same time, it can help the people who need it,” he said during a briefing on the scheme at the DBKL headquarters here, yesterday.

The People’s Housing Programme-National Economic Action Council and DBKL Public Housing special scheme, announced by Prime Minister Datuk Seri Najib Tun Razak last Tuesday, is aimed at helping existing tenants to obtain funding to purchase the houses for sale.

The scheme would commence this March and buyers are expected to sign the sale and purchase agreements in May.

Raja Nong Chik said the houses would be mortgaged to EPF and DBKL had the power to foreclose on buyers who had instalments in arrears of six months.

“DBKL would then resell the properties to those on the waiting list, which now numbers 27,000 people,” he said.

To ensure DBKL had sufficient funds to buy back the properties, EPF has placed a condition that it set up a Redemption Reserve Account with 20 per cent of profits allocated under the scheme. — Bernama