Nigerian PFAs invest 71.28% of pension assets in govt securities in 2016  as funds grew 16.4% to N6trn

Nigerian pension fund administrators in 2016 invested 71.28 percent of total pension fund assets in government securities, according to the Nigerian Pension Fund Administration Data for 2016 released by the National Bureau of Statistics (NBS).

The statistics agency noted that investments in ordinary shares were 9.48 percent, closely followed by investments in money market securities (6.51%) while investment in infrastructure funds was the least with 0.03 percent weight.

“FGN debt securities has the highest weight percentage of 71.28% of the total pension fund assets and closely followed by ordinary shares with 9.48% weight and money market securities with 6.51% weight while infrastructure funds has the least with 0.03% weight,” the report stated.

The investment profile as outlined therefore follows the general principles on investment as specified by the pension regulator PENCOM that PFAs shall invest pension fund assets with the objectives of ensuring safety and maintenance of fair returns.

The data reflected that the Pension fund asset under management as at 31 December 2016 stood at N6.17 trillion as against N5.30 trillion in 2015.

“The total asset as at the period under review represents 6 percent of the GDP as against 5.57 percent in 2015, the NBS said, adding that 98.56 percent of the funds were invested in domestic market while the remaining 1.44 percent were invested in foreign market.

Demographics on participation in the contributory pension scheme indicate that participants within the age distribution below 40 years have the highest percentage composition by sector and gender, closely followed by participants within the age brackets of 40-49 years and 50-59 years respectively while participants above 60 years has the least percentage composition by sector and gender