MANILA, Philippines - The Government Service Insurance System (GSIS) sees its net income slipping by at least 17 percent this year due to the absence of non-recurring income from the sale of its shareholdings in blue chip companies.
GSIS president and general manager Winston Garcia said in an interview with reporters that the pension fund’s net income would reach between P40 billion and P42 billion this year from P51 billion last year.
Garcia said that 2008 was “extra-ordinary” since its earnings were boosted by the sale of the pension fund’s shareholdings in electricity giant Manila Electric Co. (Meralco) to diversified conglomerate San Miguel Corp. (SMC) for P27 billion.
In all, the income from loans and investments of GSIS jumped 30 percent to P46.42 billion last year or P10.8 billion higher than the previous year’s P35.6 billion.
Statistics showed that the agency’s earnings from investments almost doubled to P28.6 billion while income from loans stood at P14.2 billion last year.
The net assets of the GSIS’s Social Insurance Fund went up by 9.5 percent to P442.02 billion last year from P403.78 billion in 2007. These funds are held in trust for social insurance benefits.
GSIS said its actuarial life is until 2055 as of end-December 2007.
The state pension fund manager has earlier expected to book a net income of at least P50 billion for this year. In 2007, it booked a net income of P41.2 billion.
Garcia said the agency would continue to look for investment opportunities to improve its financial standing.
He said the company’s earnings from investments in government securities continue to suffer from low interest rate regime.
GSIS data showed that from January to October 2008, the agency had already disbursed P28.6-billion worth of claims and benefits to pensioners, 12 percent higher than the P25.5 billion released during the same period the previous year.