Pension fund assets rise 1.4% to a record high
By Jeph Ajobaju, Chief Copy Editor
Pension fund assets rose to a historic N14.59 trillion in October, notching up 1.14 per cent on N14.42 trillion in September, an increase of N164.4 billion.
The latest monthly pension fund industry report of the National Pension Commission (PenCom) said the fund swelled by N1.16 trillion between January and October.
Retirement Savings Account (RSA) registrations jumped to 9.85 million in October, up from 9.79 million in September.
Investments in corporate debt securities by Pension Fund Administrators (PFAs) rose 2.64 per cent month-on-month (MoM) from N1.49 trillion in September to N1.53 trillion in October.
PFAs reduced their investments in real estate 4.93 per cent to N218.1 billion in October, from N229.4 billion at the beginning of the month, according to the report.
RSA fund II still accounted for most of the fund contribution with N6.35 trillion, representing 43.5 per cent of total funds, followed by RSA Fund III with N4.05 trillion or 27.8 per cent.
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Bearish stock market sentiments
Existing schemes accounted for 9.9 per cent of total funds, rising by N2.41 billion to N1.44 trillion in October, CPFAs accounted for 10.2 per cent to stand at N1.48 trillion, as reported by Nairametrics.
Investment in the local equities market dropped by N40.41 billion to N828.17 billion in October.
Bearish sentiments in the stock market induced the All-Share index to fall 10.6 per cent to 43,839.08 points from 49,029.16 in September. The market regained 8.7 per cent in November as the all-share index topped 47,660 points.
Investment in federal government debt securities continue to increase as the Central Bank of Nigeria (CBN) raised monetary policy rate to 16.5 per cent, which translates to higher returns in the fixed-income market.
Total allocation in FGN securities by the pension industry was N9.23 trillion in October, accounting for 63.2 per cent of total funds. Up to N8.84 trillion is being invested in federal government bonds.
RSA holders
A total 30,973 RSA holders switched PFAs in the third quarter of the year (Q3 2022), an increase of 109 per cent against 14,821 who switched in Q2 2022.
Increased competition reduced PFAs from 22 to 20 through mergers and acquisitions as PFAs tried to meet minimum capital of N5 billion, an increase from N1 billion imposed by tPenCom.
Total pension fund gained N156.74 billion in Q3 2022 to stand at N14.42 trillion.
First Guarantee Pension led the best-performing PFAs in Q3 2022 with an average return on investment (ROI) of 2.38 per cent, followed by Premium Pensions (2.06 per cent) and Veritas Glanvills Pensions (2.01 per cent).