Pension Funds Assets hit N7.5trn

Despite several arrears of pension owed by federal and state governments, pension funds have risen to N7.5 trillion as at the end of December, 2017, up from N7.41 trillion it was at the end of November 2017.
Although, the National Pension Commission (PenCom) is yet to release the December pension funds’ performance figure, credible sources in the pension sector disclosed that the pension assets grew significantly in the last month of 2017. It was revealed that N90 billion was added to the pension assets in December, 2017, bringing the figure to N7.5 trillion.
This means that pension contributors remitted N1.4 trillion to the pension pool in the last one year, translating to about 15 per cent of the pension assets. 
From N6.1 trillion the pension assets was in December, 2016, it soared to N6.25 trillion in January, 2017, moved to N6.29 trillion in February, leaped to N6.41 trillion in March, even as the pension fund grew to N6.49 trillion in April, 2017.
By May 2017, the pension asset rose to N6.72 trillion, jumped to N6.83 trillion in June, soared to N6.94 trillion in July, increased to N7.09 trillion in August, while in September, it stood at N7.16 trillion. The findings were to the effect that the pension funds rose to N7.29 trillion in October, moving up to N7. 41 trillion at the end of November.
Meanwhile, information obtained from the PenCom stated that 70.67 per cent of the pension funds translating to N6.28 trillion had been invested in the Federal Government of Nigeria’s securities as at the end of November, 2017.
These investments in FGN securities included N4.02 trillion amounting to 54.30 per cent in bonds; N1.21trillion in Treasury Bills (16.29 per cent); N5.99 billion in Agency Bonds (NMRC & FMBN), (0.08 per cent) and N55.69 billion in Sukuk.
The data revealed that N662.72 billion, which is 8.95 per cent of the funds, was invested in domestic ordinary shares; while N102.89 billion, amounting to 1.39 per cent in foreign ordinary shares.
Pension operators invested N148.21 billion (2.00 per cent) in State Government’s Securities; Corporate Debt Securities got N255.21 billion (3.44 per cent); Supra-National Bonds got N11.33 billion (0.15 per cent); commercial papers, N44.59 billion (0.60 per cent); Banks, N564.68 billion (7.62 per cent).
Others areForeign Money Market Securities, N31.77 billion, (0.43 per cent); private equity fund, N23.99 billion, (0.32 per cent), Real Estate Properties, N224.72 billion, (3.03 per cent); infrastructure funds, N6.07billion, (0.08 per cent) and cash & other assets, N15.35 billion, (0.21 per cent).
The reason for the constant growth in pension assets, it was learnt was the fact that pension contributions are made on a monthly basis to the Retirement Savings Account (RSAs) of employees, while the Pension Fund Administrators (PFAs) also make a lot of profits from investment of these funds into Federal Government Bonds, stock market and other less risky investment windows, which also goes into the pension funds pool.
Moreover, with some states now ready to join the Contributory Pension Scheme (CPS), as well as the readiness of the FG to settle some of its arrears, and PenCom going after defaulting employers, experts said, these indicators would continue to push the fund even beyond the current figure.
The consistent increase in the volume of pension funds has allowed pension fund operators invest more in the nation’s economy, while accruing about N2.9 trillion as income from the investment of the pension assets.

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