The Government Insurance Service System (GSIS) reported a double-digit drop in its net income in the first half of the year from a year ago as earnings were pressured by the unfavorable equity and bond market conditions.
At a press briefing on Thursday, the state pension fund said net income in the first six months of 2015 amounted to P29.6 billion, down 68 percent from the P94 billion recorded in the first half of 2014.
“As we follow the markets after 2014’s very favorable market conditions, we’re sort of struggling in 2015, both with the equity market having hit a high in April and then come off, and similarly for bonds, rates actually first dropped in the first quarter,” GSIS president and general manager Robert Vergara explained.
Total revenue from January to June fell 48 percent to P70 billion from P135 billion in the first half last year, while expenses remained flat at P41.4 billion.
Of the P41.4 billion expenses for the period, claims and benefits paid to GSIS members and pensioners reached P38 billion, while the remainder went to operating costs.
GSIS added that for the first half, it has investible assets of P874 billion, divided into fixed income instruments, member loans, equities, real estate and cash.
“When projected for 2015, we are saying we should be making something like P65 billion, so the current P29.6 billion is slightly below target,” Vergara said.
“I think there might be some improvement in the second half period because we unveiled a new loan program for our members which allows them to borrow a little bit more than their previous limits,” he said.