Effective 1 May 2009, the first $30,000 of CPF members’ Special Account balances will no longer be allowed to be used for investments. The current restriction for CPFIS-SA is $20,000.
You are not required to liquidate your CPF-SA investments if you had purchased them before 1 May 2009.
There is no change to the current requirement for CPF members to set aside $20,000 in the Ordinary Account before they can invest Ordinary Account monies.
This announcement is also available on CPF Board’s website:
Here is a summary of how the CPFIS restrictions may affect your transactions.
From 01 May 2009, CPF members will not be able to invest the first $30,000 in their CPF Special Account (CPF-SA) and the first $20,000 in their CPF Ordinary Account (CPF-OA).
If you make a CPF investment and there are insufficient monies available to be withdrawn, the purchase order will result in a failed trade.
Please check your CPF balances before any CPF purchase and make sure that there are sufficient monies to pay for your investment.
CPF-SA redemption proceeds that go back to the CPF board will be subject to the $30,000 restriction. In other words, if you sell and an amount of $30,000 is returned back to the CPF board, assuming your previous CPF balance was zero, you will no longer be able to invest this amount of $30,000.
CPF-OA redemption proceeds will be credited back to your CPF Investment Account with your agent bank. These CPF-OA monies at the CPF agent bank are not affected by the restriction. You may re-invest the sales proceeds in your CPF Investment Account, even if your CPF-OA balance is below $20,000. Typically, CPF-OA monies at the agent bank will be transferred to the CPF-OA account two months after redemption if there are no further investments made.
Funds switching for your CPF holdings under IA status will NOT be affected (except for Non-IA to IA switches for CPF-SA Non-IA holdings. You may check your “view holdings page” under the column “IA Status” to determine if your CPF holdings are under Non-IA status).
Do note that for CPF-SA Non-IA to IA switches, the switch-sell proceeds may be credited to your CPF-SA account. You may not re-invest the balance if your SA balance is below $30,000, and we may not be able to proceed with the switch-buy order.
Regular Savings Plan (RSP)
RSP deductions will fail if your CPF balances fall short of the above-mentioned restrictions, and after 3 failed deductions, your RSP will be automatically terminated. You can re-apply for RSP after you have built up CPF balances in excess of $20,000 in your CPF- OA or $30,000 in your CPF-SA.
If you have any further queries, please do not hesitate to call up our client services hotline at 65572853 or email to email@example.com.