Nigeria’s pension assets hit N10.8trn mark in May 2020

Nigeria Pension Commission (PenCom) said that the nation’s total pension assets rose to N10.8 trillion at the end of May 2020, an increase of N200billion from N10.6 trillion in April.

The data on the PenCom website, also said that the total number of Retirement Savings Account (RSA) holders had increased from N8.8 million as it was last reported, to more than 9 million as of May.

A break down of the data showed the various assets the funds have been invested in. According to the data bulk of the funds, about N7.2 trillion representing 66.7%, was invested in Federal Government’s Securities. PenCom’s Acting Director-General, Aisha Dahir-Umar, said pension fund managers have been very cautious about where they invest. She further said “Since the introduction of the Multi-Fund Structure that created four different funds, the investment of the funds has varied from one another. Fund 1 has a maximum limit of 30 percent, Fund II has a maximum of 25 percent and Fund IV allows maximum of five percent. 

The allowable exposures to variable income instruments have been designed such that Fund I has the highest allowable limit, followed by Fund II, III and IV. This reduces the risk and uncertainty of contributors in line with their ages.’’ Apparently, many companies have been unable to recruit new employees since the pandemic hit Nigeria and wrought economic challenges on different sectors. Unfortunately, PFAs’ failure to open sign up new RSA accounts could affect the total pension assets in the long run.