KARACHI, Feb 12: The Employees' Old Age Benefit Institution (EOBI) has recorded fabulous increase of Rs13.411 billion in investment portfolio during first seven months (July to Jan) of the current fiscal year , showing a rise of 17.78 per cent over Rs75.413 billion held by the institution last fiscal.

Despite the fact that the EOBI during last three years diversified its investment and moved into capital market but government securities continue to dominate its investment source.

With investment portfolio at Rs88.825 billion the EOBI has become second largest, after SLIC, institution nearing Rs100 billion investment holding. The recent pace of enlargement in investment portfolio helped by rapid rise in income out of equity and other investments is making the institution to expand its investment base.

Besides, recover of huge embezzled amount by former head of the institution through NAB and introduction of new methods of running the affairs by adopting pragmatic strategy such as 'participative management,' improving upon 'risk management' are such few example which has totally transformed a government-run body into dynamic and forward looking institution.

However, it would be difficult to maintain these achievements if there was interruption and it was left half way because consistency was one of the basic requirements for achieving long term goals for any institution or a nation. A sizeable amount on account of recoveries was also, particularly from government owned bodies.

The EOBI is holding 12.04 per cent more government securities at Rs77.779 billion against Rs69.423 billion held on January 31, 2004. Similarly, investment in equity also rose by 232.50 per cent at Rs3.958 billion from 1.190 billion in the same period last year. Investment in other instruments also stood higher by 47.65 per cent at Rs7.087 billion from Rs4.800 billion held on January 31, 2004.

Consequently, there was remarkable increase of 21.54 per cent in investment income at Rs8.578 billion during first seven months of current fiscal (July-Jan) as against Rs7.058 billion recorded in the same period of last fiscal showing an increase of Rs1.520 billion.

According to official figures investment income out of government securities was higher by 28.58 per cent at Rs7.775 billion from Rs6.047 billion in the same period of last fiscal. Income from other investments stood higher by 10.05 per cent at Rs81.002 million from Rs73.602 million of the corresponding period last fiscal.

Nevertheless, income out of equity investment declined by 22.97 per cent at Rs721.655 million from Rs936.905 million achieved in the same period last fiscal. However, income from total investment of the EOBI stood higher at Rs8.578 billion from Rs7.058 billion in the corresponding period last fiscal.

It is worth mentioning that the EOBI has made fabulous 295 per cent dividend income during period under review at Rs230.568 million from Rs58.291 million in the corresponding period last fiscal. However, there was a fall of 44.11 per cent in realized capital gain at Rs491.087 million from Rs878.614 million showing a decline of Rs387.527 million. But it is equally important to note that there was huge unrealized capital gain of 106.66 per cent at Rs229.661 million as against Rs111.131 recorded in the same period last fiscal.

The institution collected Rs1,413 billion as contribution from employers during first seven months of current fiscal showing an increase of Rs112.56 million or 8.65 per cent over the corresponding period of last fiscal.

The adoption of Accrual Accounting system by the EOBI from current fiscal has facilitated payment of contribution through automation and resulted in increase by 9 per cent in contribution from employers as it also ensured regular collection.