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CAUTION ON CURRENT NEGATIVE MARKET ENVIRONMENT
The global markets have experienced a significant drawdown for the year to date (31 May 2022). The MSCI World Equity Index in Rand terms is down -15.3%, the FTSE JSE ALSI Equity Index is down -0.4%, the FTSE/JSE SAPY Property Index is down -2.6% and only the FTSE/JSE All Bond Index is up 1.2%. Based on the above, the outlook for 2022 is therefore largely negative. The following is a summary of the key factors driving the current markets and our view in this regard.
WHAT THE PROPOSED “TWO-POT” SYSTEM MEANS FOR YOUR RETIREMENT FUND SAVINGS
What is the Two-Pot system?
National Treasury has proposed the Two-Pot system which allows you to save one-third of your retirement contributions in a “pot” that you can access over a 12- month cycle, the compromise is the remaining 2/3rds of your accumulated savings will need to be preserved, from a prescribed date.
NBC ICS MANAGER RESEARCH UPDATE: STEINHOFF AND THE PROCESS OF RECOVERING INVESTMENT LOSSES
At the beginning of February 2022, the Western Cape High Court approved Steinhoff’s bid to have its €1.43 billion (R25 billion) settlement proposal made final and binding. The date in which settlement will commence was set as 15 February 2022 and the distribution of these settlement funds is expected to be sometime late in May 2022.
THE IMPACT OF THE AMENDMENTS TO REGULATION 28 OF THE PENSION FUNDS ACT
The Minister of Finance Enoch Godongwana during his 2022 Budget speech announced that changes to Regulation 28 of the Pension Funds Act, will allow for an increase in total offshore investment allowance up to 45%.
UPDATE ON CHANGES TO REGULATION 28 AND THE IMPACT ON RETIREMENT FUNDS
A draft version of an updated Regulation 28 has been released for comment. We have
summarized the proposed changes in the points listed below:
