The total assets under the Contributory Pension Scheme rose to N9.58tn as of the end of September, according to the National Pension Commission. A total of N6.84tn or 71.43 per cent of the funds have been invested by the Pension Fund Administrators in the Federal Government of Nigeria’s securities, including FGN bonds, treasury bills, agency bonds, Sukuk bonds and green bonds.
A total of N125.24bn or 1.31 per cent of the funds was invested in state government securities, while N492.08bn and N65.14bn went to domestic ordinary shares and foreign ordinary shares, respectively.
A sum of N621.95bn or 6.49 per cent of the funds was invested in corporate debt securities including corporate bonds, corporate infrastructure bonds and corporate green bonds, the commission said. The pension operators invested N4.03bn or 0.04 per cent in supra-national bonds, while N8.4bn or 0.09 per cent of the funds was invested in foreign money market securities, it added.
According to the commission, N21.81bn or 0.23 per cent of the funds was invested in mutual funds, including open/close end funds and REITS. It said a total of N231.48bn or 2.24 per cent was invested in real estate, while N32.05bn or 0.33 per cent was invested in private equity fund. The operators invested N34.89bn or 0.36 per cent in infrastructure funds, while N26.47tn or 0.28 per cent of the funds was invested in cash and other assets.
The Pension Reform Act, which introduced the CPS, was inaugurated in 2004, providing a contributory arrangement in which the employer and employee could contribute to the workers’ RSAs.
The President, Pension Funds Operators Association of Nigeria, Mrs Aderonke Adedeji, said the role of pension funds in economic development had moved into the focus of public attention, particularly with regard to Nigeria’s growing need for long-term capital.
She explained that successful mobilisation of pension fund assets and its contributions to the economic growth of any nation had become essential policy objectives. “For the first time, our country can now boast a long-term funding base and the impact to date has included the funding of the government projects, development of the capital market as well as increased foreign development inflows,” she said.