THE Government Service Insurance System (GSIS) is set to invest more in publicly listed companies in the banking, energy and power, and other utilities sectors at the Philippine Stock Exchange (PSE) starting next month.
Robert Vergara, the pension fund president and general manager, told reporters that after the GSIS completes its recall of funds meant for its Global Investment Program in June, the agency will become aggressive in investing in the equities market.
“Banks are great proxy to determine [the health of] your local economy,” Vergara said. He did not give specifics on which of the listed companies’ shares the state-owned pension fund plans to buy, but it will be in the heavy industries, such as those in power generation and energy, utilities such as the telecommunications companies, and, possibly, in the property sector but through real-estate investment trust (REIT).
At the moment, Vergara said around 6 percent of its P580-billion total funds meant for investments were in the stock market.
When the total funds of about P32 billion from its investments overseas arrive in full by June, it will push its investible funds to around P612 billion.
“Too much cash strains your returns too much,” Vergara said. “I want equities to be in about 8 percent to 9 percent [of GSIS’s investible funds].”
Currently, GSIS’s placements in the equities market is around P45 billion. Increasing the share of its investments in the equities market to 9 percent could mean an additional cash of around P10 billion to be poured into the stock market.
Vergara said the amount could be more since he also wants to be active in REIT, but the Securities and Exchange Commission and the Bureau of Internal Revenue still have to resolve their differences on the various issues for its implementation.
The GSIS earlier said its net income for the first quarter this year was flat at P14.6 billion or around the same level as last year’s.
“Last year, there were equity transactions. But this year, there were not as many equity transactions but there was an increase in premium [payments] as a result of the salary increases [of government workers] last June,” Vergara said.
He said it was easy for the pension fund to project is growth for the year, as it was only looking at the premium payments of the members and investment income.
“I think were looking at around P50 billion to P55 billion in net income this year. Were on track [on net income for the first quarter],” Vergara said.
“We’re slightly not on track on the equity returns because the [stock] market was not doing well in the first quarter, and bounced sharply only in April,” he added.
