Since 1 January 2008, interest rate for savings in the Special, Medisave and Retirement Accounts (SMRA) has been pegged to the 12-month average yield of the 10-year Singapore Government Security (10YSGS) plus 1%. The average yield of the 10YSGS over one year, from 1 September 2008 to 31 August 2009, plus 1% worked out to be 3.40%.

To help CPF members adjust to the floating SMRA rate, the Government will maintain the 4% floor rate for two years, from 1 January 2008 to 31 December 2009, if the 10YSGS yield plus 1% is below 4%. After 31 December 2009, the 2.5% floor rate will apply for all CPF accounts.

Hence, the SMRA interest rate from 1 October 2009 to 31 December 2009 will be 4% (floor rate).

Additional Interest of 1%

An additional 1% interest will be paid on the first $60,000 of a member’s combined balances, with up to $20,000 from the Ordinary Account (OA). The additional interest received on the OA will go into the member’s Special or Retirement Account to enhance his retirement savings.

The CPF interest rate will continue to be reviewed quarterly. Improving returns on CPF savings is one of the key changes introduced to help Singaporeans improve their retirement adequacy.

For the computation of the CPF interest rate for SMRA and the 10-year SGS
yield, please refer to Annex A.

Public Enquiries

For more information, please visit www.cpf.gov.sg or call the CPF Call Centre at 1800-227-1188.

Annex A

Computation of Special, Medisave and Retirement Accounts (SMRA)
Interest Rates for October to December 2009

Average yield of 10-Year SGS from Sep 08 to Aug 09       2.40% (Note 1)
Plus 1%                                                                        1.00%
Computed SMRA Interest Rate for Oct 09 to Dec 09          3.40%

SMRA Interest Rate (Oct 09 to Dec 09)                            4.00% (Note 2)

Note
1. Source: Yields of 10-Year Singapore Government Securities are obtained from www.sgs.gov.sg

2. A floor of 4% for the SMRA rate will be maintained for two years from
1 January 2008 to 31 December 2009. After 31 December 2009, the
2.5% floor rate will apply for all CPF accounts.

Name	Christine Seow-Yeo
Tel	62293269
Other	98747753
Email	christine.seow@cpf.gov.sg