The irregular investments of monies of the Employees Provident Fund (EPF) in the stock exchange had resulted in the loss of a whopping Rs.8.1 billion, as per the present market prices, Parliament was informed yesterday.
Making his remarks during the committee stage of the budget debate, United National Party (UNP) MP Dr. Harsha de Silva said the Central Bank had invested EPF money in 65 companies despite some of them making huge losses.
Of these companies where EPF money was invested, he said, Grain Elevators purchased 5,350,549 shares by June 20, 2012 at Rs.187. The market price had dropped to 35.70 percent per share by December 10, 2013, causing a loss of Rs.814 million. Also, 6,449,645 shares of Browns PLC had been purchased at 266.41 each. The market price had dropped to Rs.81.70 by December 10, 2013, leading to a loss of Rs.1.1 billion. Dipped Products, Laugfs Gas Co., Lanka Indian Oil Company and Galadari Hotel were among other companies with low investment portfolios where EPF money was invested.
Dr. de Silva tabled the necessary documents outlining the total losses. He charged that these investments had been made regardless of guidelines set out for it by the EPF. Though it is clearly stipulated that EPF money should not be invested in financial institutions and banks, that principle had been violated by the Central Bank this time. He said the EPF should invest only in the optional shares of Blue Chips.
“It means they cannot invest in the optional shares of other companies,” he said. (Kelum Bandara and Yohan Perera)