THE Special Administrative Region's fiscal strength was given a hefty boost yesterday with the announcement that the SAR Land Fund had grown a record 48 per cent in the last financial year to a total of $65.5 billion. The China-appointed trustees said the balance sheet at March 31 this year reflected a net increase of $21.2 billion. Of that, about $17 billion was derived from enthusiastic bidding at land auctions, bringing the SAR's income from land premiums to $52.3 billion. Another $4.3 billion came from a wide range of investments by the Land Fund's six-man investment committee, which includes the Chief Executive of the Hong Kong Monetary Authority, Joseph Yam Chi-kong. Earnings for the year brought the accumulated surplus to $13.22 billion. The Land Fund, set up in 1986, handles the SAR's 50 per cent share of land premiums in the run-up to 1997. Chief executive Tim Chung Shui-ming said the impressive result came from the good yield from land sales, as well as the diversified investment strategy adopted by the investment committee. Under current trends, Mr Chung said it would be likely that the Land Fund would reach $100 billion by 1997, as predicted earlier this year by the Director of Hong Kong and Macau Affairs Office, Lu Ping. 'Because of our diversified and stable investment strategy, the return rate was still satisfactory despite the very poor performance in the securities market,' Mr Chung said. Stock markets in Southeast Asia and Hong Kong had dropped 25 per cent in the first three months, he said. In response to this, the Land Fund has increased its share of bank deposits from 17.6 per cent, or $7.8 billion, to 22.3 per cent, or $14.7 billion. The remaining 77.7 per cent - $50.9 billion - was invested in securities. This was accompanied by an increase of its Hong Kong dollar net assets from 19.7 per cent, or $8.7 billion, of the previous year to 26 per cent, or $17 billion. 'Because the Hong Kong dollar offers a better yield than the United States dollar, we decided to deposit in the Hong Kong dollar,' Mr Chung said. Chinese stock, H and B shares, was less than one per cent of the investment. he said. He refused to speculate on the performance of the fund this financial year, saying land prices were difficult to predict. But William Wong Wing-lam, partner (valuation) of Brooke Hillier Parker, said this year would see a decline in the amount yielded from land premiums. 'Compared with last year, there are fewer prime sites for sale this year,' he said. Citing the record low bidding price of a land auction last week, Mr Wong said the continuation of the trend would add negative factors to the land premium income this financial year.