Ultimate Guide to Amanah Saham Bumiputera (ASB): Dividend Rates, Investment Strategies and Financing Explained

What exactly is Amanah Saham Bumiputera (ASB)?

ASB is a trust fund unit that was launched and established on January 2,1990 by Amanah Saham Nasional Berhad (ASNB), a subsidiary of and wholly-owned by the unit trust management company of Permodalan Nasional Bhd (PNB). 

As a trust funds unit, ASNB’s objectives are mainly to provide alternative saving vehicles as well as for generating long-term consistent and competitive returns whilst ensuring the preservation of capital at minimal risk tolerance for investors.

Hence, ASB was designed as a fixed price equity income fund. The price per unit of the fund is fixed at RM1.00, without any additional charges such as sales charges and fees for redemption of units.

While investors can continue adding to their ASB accounts, they are subject to a maximum investment limit of 300,000 units or RM300,000. The dividend is distributed on an annual basis but calculated monthly based on the minimum or available amount of the month.

Why buy into ASB?

There are 9 benefits that make ASB a compelling choice for eligible Bumiputera investors looking for a secure, hassle-free way to build wealth. With its combination of stability, reliable returns, and flexibility, ASB stands out as a prime investment option for those seeking a dependable financial growth strategy.

1. Low-Risk Investment
   ASB is widely considered a low-risk investment. With a fixed unit price of RM1, there’s no risk of your capital depreciating, making it a stable choice even for conservative investors.
2. Competitive and Consistent Returns
   ASB has a strong track record of delivering competitive annual dividends of more than 5% since inception in 1990. Even during economic downturns, ASB has maintained attractive yields, making it a reliable source of passive income.
3. No Upfront Fees
   Unlike many investment products, ASB does not impose upfront fees. 
4. Low Management Fees
   ASB charges a nominal 0.35% annual management fee, significantly lower than the typical 1.5% charged by other equity unit trust funds.
5. High Liquidity
   ASB provides high liquidity, allowing you to access your funds quickly. Investors can withdraw up to RM500 monthly online, with larger withdrawals available through ASNB counters, ensuring ready access to cash when needed.
6. Collateral for Financing
   ASB investments can be pledged as collateral for overdraft facilities, adding flexibility for those who may require financing options without liquidating their investments.
7. Tax-Free Dividends
   Dividends earned from ASB are exempt from taxes, which means investors receive the full benefit of their returns without additional deductions.
8. Managed by a Trusted Institution
   ASB is managed by PNB, Malaysia’s leading asset management company with a reputation for prudent investment strategies and a history of strong performance. 
9. Easy to Access and Invest
   With numerous ASNB branches, agent networks, and digital platforms, investing in ASB is simple and accessible. 

Historical investment returns of ASB

Of course, just like any other investments, it is vital for investors to know the dividend history of the company they want to invest in. A company’s dividend history provides good insight into the said company’s financial health, performance, risks, and returns.

As such, ASB’s dividend history would provide insights into their financial health and performance over the last few years.

Despite the downward trend and at the lowest in 2020 due to market downturn caused by a global pandemic, ASB is still able to give a dividend payout of 5%. Although 5% may seem low, it still outpaces the inflation rates in Malaysia at that time, which was 3.8%. 

Investment Strategies of ASB: Asset Allocation and Focus

Amanah Saham Bumiputera (ASB) employs a carefully designed investment strategy to achieve stable and consistent returns for its Bumiputera investors. Managed by Amanah Saham Nasional Berhad (ASNB), ASB’s portfolio is diversified across high-quality equities, fixed-income securities, and other assets to provide a balance of growth and risk mitigation. 

ASB Asset Allocation (As of End 2023)

Top Equities in ASB’s Portfolio (as of 2023)

How to buy into ASB?

Step 1: Opening an ASNB Account

The first step is to open an ASNB account, either in person at a branch or through ASNB’s myASNB mobile app. There are two account types:

There are two ways to open an ASNB account:

In-Person Registration

• Visit an ASNB branch or ASNB agent.
• Fill out the required forms and submit the documents.

Online Registration via myASNB Mobile App

• Download the myASNB app from your app store.
• Sign Up with your personal information.
• Set Up your username and password to secure your account.

Note: Online registration is available for Malaysian citizens aged 18 and above with a MyKad. Foreign or U.S. tax residents must open accounts in person.

Step 2: Making Your Investment

Once your ASNB account is active, you can begin investing in ASB with a RM10 minimum investment. Here are the available options:

Financing options for ASB

If you’re eager to invest in Amanah Saham Bumiputera (ASB) but haven’t yet saved enough funds, there are several financing options available to help you get started.

EPF Members’ Investment Scheme

Employees Provident Fund (EPF) members can utilize their retirement savings to invest in select ASNB funds. This scheme permits EPF members to allocate up to 30% of their excess savings from Account 1 through the EPF i-Invest platform.

Although EPF funds cannot be used directly for ASB investments, they are eligible for other ASNB funds, such as:

• Fixed-Price Funds: ASB2, ASB3 Didik, ASM3, ASM2 Wawasan
• Variable-Price Funds: ASN Equity 2, ASN Equity 3, ASN Imbang 1, ASN Imbang 2, ASN Sara 1

Salary Deduction Scheme

The Salary Deduction Scheme offers a convenient way to invest in ASB or ASB2 by automatically deducting a portion of your monthly salary. This scheme is available for both public and private sector employees, making it easy to invest on a regular basis.

• Public Sector Employees: Fill out an Authorisation Letter for Salary Deduction, get it verified by your employer, and submit it at an ASNB branch.
• Private Sector Employees: Complete the authorisation letter and apply through your employer.

ASB Loan Financing

ASB Loan Financing is a unique offering by local banks for Bumiputera investors interested in leveraging an ASB investment but lacking the initial capital.

Typical ASB Loan Terms:

• Maximum Tenure: Up to 40 years or until age 70.
• Interest Rate: Base Rate + as low as 1.40% (rates vary by bank).
• Maximum Loan Amount: RM200,000.

Choosing the right ASB Financing option

When choosing a bank, compare their interest rates, loan tenure, and whether they offer conventional or Islamic financing. Additional features like insurance or takaful coverage can be valuable for safeguarding your investment against unforeseen circumstances.

Step-by-Step guide to applying for ASB Financing

1. Choose a Bank
   Begin by selecting a bank that offers ASB financing packages suited to your needs. Look for favorable terms, competitive rates, and added benefits like takaful coverage for extra security.
2. Check Eligibility and Prepare Documents
   ASB financing is exclusively available to Bumiputeras in Malaysia. Most banks require applicants to be at least 18 years old and have stable employment and income
3. Documents Required:
   MyKad; latest salary skips or proof of income; bank statements, existing ASB account details
4. Submit the Application
   Submit your completed application at a bank branch or online, if the bank supports electronic applications. The application includes forms for identification and income verification. Some banks offer online processing to accelerate the approval process.
5. Loan Approval Process
   After submission, the bank assesses your financial health, stability of income, and credit score. This review period can range from a few days to a couple of weeks, depending on the bank’s processing speed.
6. Loan Disbursement and Unit Purchase
   Upon approval, the loan amount is disbursed directly into your ASB account, enabling you to purchase ASB units immediately. This approach allows you to start earning dividends on the full loan amount right away, maximizing early returns.
7. Begin Loan Repayments
   Monthly loan repayments begin according to the terms agreed with the bank, covering both the principal and interest (or profit in Islamic financing). Budget carefully to ensure that these payments fit within your overall financial plan, avoiding sole reliance on dividends to cover them since dividends can fluctuate.
8. Monitor and Reinvest Dividends
   Regularly monitor your ASB investment and loan status through ASNB’s online platform or your bank’s app. Many investors choose to reinvest dividends to capitalize on compounding returns, a strategy that enhances long-term growth potential.

Differences between ASB and ASB2

Amanah Saham Bumiputera (ASB), launched in 1990, and Amanah Saham Bumiputera 2 (ASB2), introduced in 2014, are both fixed-price unit trust funds managed by Amanah Saham Nasional Berhad (ASNB).

ASB2 was created to meet the increasing demand for investment opportunities among Bumiputera investors, allowing them to invest an additional RM300,000, bringing the combined limit for both funds to RM600,000.

While both funds share a fixed price of RM1 per unit, their asset allocation differs. ASB focuses primarily on equities for long-term growth, while ASB2 adopts a mixed-asset strategy, balancing equities with fixed-income securities for a more moderate risk profile.

Dividend performance also varies slightly. In 2023, ASB declared 5.35 sen per unit, compared to ASB2’s 5.00 sen. By 2024, ASB2’s dividend improved to 5.25 sen per unit. 

Amanah Saham Bumiputera 2 (ASB2) dividend history

Can Non-Bumiputera invest in ASB?

Amanah Saham Bumiputera (ASB) is primarily designed for Bumiputera investors in Malaysia. However, certain non-Bumiputera individuals are also eligible to invest in ASB under specific conditions.

Eligibility for Non-Bumiputera Investors:

Non-Bumiputera Malaysian citizens can invest in ASB if they belong to one of the following categories:

• Siamese/Thai Descent
• Portuguese/Eurasian Descent
• Non-Bumiputera Muslim Converts

These eligibility criteria are outlined in the ASB Product Highlights Sheet.

Alternative Investment Option: Amanah Saham Malaysia (ASM):

For non-Bumiputera individuals who do not meet the above criteria, Amanah Saham Malaysia (ASM) offers a viable alternative. ASM is a unit trust fund managed by Amanah Saham Nasional Berhad (ASNB) and is open to all Malaysian citizens, regardless of ethnicity.

It shares similarities with ASB in terms of investment strategy and is considered a low-risk investment with consistent returns.

Key Features of ASM:

• Open to All Malaysians: Unlike ASB, ASM does not have ethnic-based eligibility restrictions.
• Investment Strategy: ASM invests in a diversified portfolio, including equities, fixed-income securities, and money market instruments, aiming for steady growth and income generation.
• Dividend History: ASM has a track record of providing stable dividends, though historically, its dividend rates have been slightly lower than those of ASB.
• Management Fees: ASM charges an annual management fee of 1%, which is higher than ASB's 0.35%.
• Unit Availability: Securing ASM units can be challenging due to high demand and limited availability. Prospective investors may need to check with ASNB agents or frequently monitor the myASNB portal to acquire units.

In line with the Malaysia Madani Budget 2023, the ASM fund size was increased by RM5 billion starting May 1, 2023, to accommodate more investors.

Amanah Saham Malaysia (ASM) dividend history

Even at its lowest rate of 4.25%, ASM dividends remain competitive when compared to other low-risk, long-term investment options in Malaysia such as Fixed Deposits, making it a reliable choice for steady growth.

Invest without limit with StashAway Simple

While Amanah Saham Bumiputera (ASB) and Amanah Saham Malaysia (ASM) are great investment tools for many, they come with investment limits. If you're looking to diversify your portfolio or grow your idle cash without restrictions, StashAway Simple offers an excellent alternative.

StashAway Simple provides a projected return of 3.6% per annum, making it a competitive option compared to other low-risk investment products. What sets it apart is that it does not impose lock in period, and there's no minimum and maximum investment required. 

By combining ASB with StashAway Simple, you can balance your investments for steady returns while taking advantage of unlimited growth potential. Don’t let limits hold you back—explore flexible options to make the most of your financial strategy.

Should you invest in ASB?

Investing in Amanah Saham Bumiputera (ASB) is more than just a financial decision—it’s a step towards building a secure and prosperous future. With its low-risk structure, consistent dividends, and flexible financing options, ASB provides a reliable pathway for Bumiputera investors to grow their wealth effectively. Whether you're starting with a modest savings amount or leveraging financing to maximize your investment, ASB’s structure is designed to cater to diverse financial needs.

However, success in any investment depends on informed decisions and disciplined financial management. By understanding ASB’s strategies, benefits, and limitations, you can take full advantage of this fund to meet your financial goals. Start investing today and let your money work harder for you, ensuring long-term stability and growth.