GEPFBL Premium reports that SA’s sluggish economy and the Covid-19 outbreak and associated lockdowns had a devastating effect on the Government Employees Pension Fund (GEPF).  

The fund said its portfolio declined nearly 12% for the year ending March 2020.  Despite the lockdown only being announced towards the end of that month, it cited market turmoil due to Covid-19 among the main drivers of the performance.  The pension fund of SA’s more than 1.2-million public servants saw its value fall by R243bn to R1.64-trillion “as a result of the impact of Covid-19, the downgrade in credit ratings and a persisting low growth environment”, the fund advised in a statement on Monday.  SA’s lockdown was among the most stringent globally, which had severe consequences for the GEPF which has more than half its portfolio invested in local equities.  Even before Covid-19, a deterioration in SA’s economy led to a loss of its last remaining investment grade credit rating at the end of March, leading to international bondholders reducing their holdings of SA assets.  The GEPF said its portfolio has been recovering since, as economic activity gradually rose and markets calmed.  It now stands at an unaudited value of R1.9-trillion.

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