How to Invest

Investments of Maldives Retirement Pension Scheme

The Maldives Retirement Pension Scheme (MRPS) is administered by the Maldives Pension Administration Office (MPAO).

The Investment Committee of the MPAO Board is responsible for issuing investment guidelines regarding the investment of pension contributions. The Statement of Investment Principles (SOIP) issued by the Investment Committee states the objectives, risk management and governance aspects of the investment regime. The day to day Investment operations are managed in-house by the Investments and Financial Management Division of MPAO.



Investment Philosophy

MRPS Investment philosophy is to generally preserve the capital value of member contributions and grow in line with the Maldivian economy at a rate higher than domestic inflation by investing in assets allowed in the Pension Act.

MRPS Investments can be made in the following asset classes in Maldives:

  1. Bank accounts and monetary funds licensed by relevant regulatory authorities.
  2. Securities issued by a Government of Maldives
  3. Securities issued by business entities listed on a licensed stock exchange
  4. Mutual and investment funds licensed by relevant regulatory authorities

MRPS assets can also be invested in overseers in the asset classes listed above.



Investment Process

Due Diligence

All MRPS investments undergo a due diligence process. For public sector investments the investment committee monitors government debt position and MRPS exposure to the debt on a case by case basis before the investments are made. Investments in public sector are placed in securities issued by GoM or a body of GoM, to extent such a security is guaranteed by the GoM.

Private sector investments undergo a separate investment due diligence process where the appropriateness investee companies are generally assessed based on the factors outlined below.




Investment Risk Management

Any investment is subject to a level of risk as investment returns and capital preservation of assets depends on market performance and macroeconomic conditions. MRPS has a robust risk management regime to monitor investment risks and adopt best practices to minimize investment risks.

Internal control

MPAO’s independent internal Audit and Investment Compliance Division monitor the investment operations on a routine basis and reports directly to the Board and regulatory authorities. In addition, MPAO board also conducts frequent MRPS audits using third party independent auditors and publishes MRPS annual accounts on an annual basis as required by the Pension Act.

External controls

The market regulator, CMDA also conducts offsite and on-site inspections frequently and recommend best practices to improve operations. Moreover, the market regulator can proactively initiate special audits and can issue directives restricting investments made in certain classes of assets.



Member Choices

Members contributing to MRPS has two funds to deposit their pension contributions for investments.

MRPS Investment Fund

The Investment Fund is the default fund of MRPS and focus on diversifying investments in assets allowed under the pension act and available locally to achieve a return above the local inflation rate. Fund investments are diversified across a range of multi-asset classes which are currently, Treasury Bills, Treasury Bonds, Corporate Bonds, Equities and Bank Deposits.


MRPS Sharia Fund

The Sharia Fund can be chosen by members wishing to invest pension contributions in Sharia compliant assets. MPAO regards assets as sharia compliant if those assets are considered as sharia compliant by competent sharia authority approved in Maldives. This fund also targets to beat the local inflation rate and perverse capital value by investing in sharia compliant assets allowed under the pension act and available for investments in the Maldives. Investments are currently made in GIAs (Fixed Deposit) and Corporate Sukuk (Sharia Bonds).


Funds of members who have retired are moved into separate two Funds during the payout phase which invests in short term investments to maintain liquidity.

Funds of retiring Investment Fund members are moved to the Conservative fund which typically keeps a set portion as cash and typically invests in Treasury bills and Fixed Deposits. Funds of members retiring from the Sharia fund are moved to the Sharia Retirees Fund which also keeps a set portion as cash and typically invests in GIA.



MRPS Strategic Asset Allocation (SAA)

History of SAA

Diversification of investments and achieving the best possible risk-adjusted returns have been the top priority of MPAO. During the initial years of the scheme, more than 90% of the investments were placed in assets maturing in one year or less, typically as one year treasury bills. This meant that a significant portion of the scheme assets remained exposed to any changes in the Treasury bill rates. During this this time MPAO has strived hard to engage market participants in both private and public sector to issue longer term investments to shift fund investments into longer term maturities.

During the year 2015, the GoM started issuing Treasury bonds targeting MRPS and subsequently significant changes have been brought by the Investment Committee to accommodate investments of longer maturities. These changes are expected to lock in investment returns into the long term and reduce the volatility of returns.

Current Strategic Asset Allocation

The current strategic asset allocation was issued by the Investment Committee for a period of five years targeting to place 85% of the fund assets into Growth Assets (Equities and Bonds) and the remaining as Cash or Cash Equivalents (CCE) by 2020.

The Sharia fund is required to keep a minimum of 40% invested as Cash or Cash Equivalents (CCE) and has a maximum cap of 55% for Growth Assets (Sharia Equity and Sukuk).


The retiree funds (conservative and sharia retirees fund) are required to keep 100% of their assets invested as CCE investments.


Performance of Funds

All MRPS funds are unitized funds. Member interest in the fund is represented by units and members are allocated additional units when contributions are made and units are redeemed on transfer of funds and on exit. Individual member balances are valued based on fund price.



Latest Update