N17.35trn pension assets to grow as operators eye offshore investments

From Uche Usim, Abuja

Pension assets in Nigeria currently at N17.35 trillion as at the third quarter (Q3) of 2023 is set to grow further with pension operators gearing up for overseas investments.

Data from the National Pension Commission (PenCom) has revealed that pension assets grew to N17.35 trillion from N815.18 billion in 2007 as more contributors  joined the fray.

A breakdown of contributors shows that the public sector contributed N4.87 trillion while the private sector’s contribution stood at N4.5 trillion, totalling N9.37 trillion. An estimated N7.98 trillion came from accruals to the pension fund investment by the 19 Pension Fund Administrators (PFAs) under the Contributory Pension Scheme (CPS).

The operators on the platform of Pension Fund Operators Association of Nigeria (PenOp) said they would not rest on their oars as modalities were being fine-tuned with necessary regulatory bodies like the National Pension Commission (PenCom) and the Central Bank of Nigeria (CBN) to explore offshore investments.

Chief Executive Officer of PenoP, Oguche Agudah, at a recent interface with journalists, also disclosed that N964,239.47 billion was paid to 330.201 applicants as of Q2 2023, while N665.13 billion was paid to 11,708 applicants as a lump sum paid on life annuity.

According to Agudah, PenCom has since recovered N24.8 billion in outstanding pensions within the same period.

He added that N1.54 trillion representing 10 per cent of total pension assets have been invested in corporate debt securities across sectors of the economy, including corporate bonds, telecommunications, flour mills, power and industries.

The value of investments in corporate debt is now N1.86 trillion, while the value of assets in the equity market is put at N1.54 trillion or 8.88 percent of the total assets.

On worries that the federal government’s plans to borrow from pension funds could destabilize the industry, Agudah allayed such fears, assuring that pension fund administrators would insist on due diligence before investing pension funds in any government project. He added that pension funds are insulated from abuse and waste.

More so, N1. 63 trillion has been paid as lump sum to retirees on programmed withdrawals and annuity as at June 2023 and over N208 billion representing 25% RSA balance has been paid to eligible workers who lost their jobs. The Penop CEO said in 2024, operators would deepen collaboration with the Governors’ Forum to ensure that more states benefit from the Contributory Pension Scheme.

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