$1.7bn Solvency Reserve Account for ‘rainy days’
1 February, 2023, 12:30 pm
The Fiji National Provident Fund has undistributed profits amounting to $1.7 billion.
Fund CEO Viliame Vodonaivalu said this was part of their Solvency Reserve Account.
“Solvency is your ability to pay for your obligations at any time,” he said while speaking in Lautoka recently.
“In other words, if you apply it in a personal setting, you have enough funds to cater for your expenses at any particular time.
“We brought our Solvency Reserve Account to a total of $1.7billion.
“In simple terms, it’s more like undistributed profit over the years. It’s one of the biggest and if you had to compare us to others, they don’t do this.”
He said the intention of the Fund was to cater for the risk factor for every investment that FNPF had committed to.
“If anything of these risks happen, we will be able to buffer that. This is a buffer fund to cater for any adverse condition that happens.”
He said FNPF’s reserve funds were made up of two accounts, Investment and Solvency.
“We are required by law to have the Solvency account and that we maintain 10 per cent above our liability which is our members’ funds.
“Our Solvency account is around $810 million and our Investment Reserve Account is around $920 million which makes up the $1.7 billion.
“That is the biggest distinction with FNPF’s Super Fund compared to any other investment outlet in the country. We keep the reserve for rainy days.”