SINPF Records 6.2 Percent Decline in Membership

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BY ALEX DADAMU

THE Solomon Islands National Provident Fund (SINPF), has recorded a decline in its membership this year.

According to the June 2020 Central Bank of Solomon Islands (CBSI) Financial Stability Report (June 2020 FSR) which was released recently, the SINPF has a total membership of 148,776 in June 2020.

2020 CBSI Financial Stability Report noted that this was a decline of 6.2 percent against December 2019.

This was largely due to a rise in loss of formal employment and a sudden increase in the number of formerly retiring members that withdrew all their savings during the Fund’s COVID-19 relief payment program,” the report stated.

The June 2020 FSR further noted that regarding profitability, the COVID-19 pandemic, coupled with the subdued market conditions, have suppressed the ability of the earning assets to generate adequate income for the Fund to sustain its operations.

This resulted in the Fund recording a return on assets before extraordinary items and tax ratio (ROABEIT) of zero percent in June 2020, compared to 8.6 percent in December 2019 and 19.4 percent in June 2019,” June 2020 FSR revealed.

The zero percent growth in ROABEIT according to the 2020 CBSI Financial Stability Report, indicates a significant fall in noninterest income while personal and administration expenses continue to grow. Unfavourable outcome in both the former and latter stemmed from the impact of COVID-19.

According to CBSI the superannuation sector, in which the SINPF remained as the only superannuation fund in the country, constitutes 37.2 percent of the total assets of the Solomon Islands financial system, second only to the banking sector.