MANILA, Philippines —Earnings of the Government Service Insurance System (GSIS) nearly doubled in 2023 on the back of its “astute” investments that are expected to extend the state pension fund’s life and ensure timely pension payments.
The GSIS netted P113.3 billion in 2023, up 70 percent compared with the previous year, figures released on Monday showed.
Revenues jumped 33 percent to P311.3 billion last year. Of that amount, P177 billion came from contributions from GSIS members, marking a 17-percent increase year-on-year.
But GSIS also paid P166 billion in pension and other benefits last year, higher than P157 billion it settled in 2022.
Financial results also showed GSIS collected P9.8 billion in gross premiums written for its nonlife insurance business in 2023, up by 44 percent and the highest ever in the state-run firm’s history.
Boost from investments
Beyond the usual cash flows from contributions and insurance premiums, GSIS president and general manager Wick Veloso said the company’s topline also got a significant boost from its investments.
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“GSIS remains to be strong as we continue to search for yield to boost its generation of revenue,” Veloso said in a statement.
Figures showed GSIS’ investments in equities posted a market-to-market gain of P8.2 billion last year, a reversal from the 2022’s loss of P37.4 billion, due to “stabilization of interest rates” and “accumulation of strong local equity names.”
At this point, GSIS said it was looking for more investment opportunities in the private equity market to further diversify its portfolio and generate bigger long-term returns. This year, the company invested an additional $300 million in New York-based Global Infrastructure Partners Emerging Market Fund.
Gov’t bond holdings
In terms of fixed-income investments, income from GSIS’ government bond holdings amounted to P57 billion amid “favorable market conditions.”
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Moving forward, GSIS said gains were expected from the company’s decision to participate in the state’s first-ever sale of tokenized treasury bonds.
“Our risk profile has remained balanced with our fixed income having extended its average tenor to 7.8 yrs while maintaining average yield at 7.3 percent in a climate of declining rates,” Veloso said.
At the same time, GSIS also ramped up its lending activities, after credit, particularly in the multipurpose loan segment, soared to P209.6 billion last year from P157.7 billion in 2022.. —Ian Nicolas P. Cigaral INQ