Victor Ezeja
Nigeria’s pension fund assets have increased to N19.787 trillion as of 30 April 2024.
This reflects about a 0.6 per cent increase from the previous net asset value of N19.669 trillion recorded in March 2024.
Join our WhatsApp ChannelThis was revealed in the monthly report published by the National Pension Commission (PenCom) for April 2024, seen by Prime Business Africa on the PenCom website.
The increase is attributed to a combination of factors such as a surge in pension fund contributions and a rise in portfolio values.
Portfolio Allocation
The report showed allocation to various asset classes. The allocation to the Federal Government of Nigeria (FGN) securities, maintains the lead in the investment landscape with N12.396 trillion, which represents 62.65 per cent of the total net asset value.
This is followed by Federal Government Bonds, which rose to N11.709 trillion approximately 59.2 per cent of the total net asset value.
The report also shows that Pension funds have invested N1.952 trillion in money market instruments and N2.095 trillion in corporate debt securities. In order to balance risk and return, these allocations show a diverse strategy for pension asset management.
But the report also notes a significant drop in investments in ordinary shares of local companies. These investments’ value decreased from N2.082 trillion in March to N1.822 trillion in April, a 12.49 per cent decrease.
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These allocations show how pension fund assets are managed using a diversified strategy that aims to balance risks and returns.
Further analysis of the report shows that Fund II, which is the default Retirement Savings Account (RSA) Fund under the Multi-Fund Structure, remained the highest allocation to the Active RSA Funds, with N8.303 trillion, representing 41.96 per cent of the overall net asset value.
Fund III experienced growth as well, moving from N5.173 trillion in March 2024 to N5.216 trillion in April 2024, an increase of 0.83 per cent, which allowed it to remain the second-largest allocation.
Fund IV reported N1.447 trillion in April 2024, which is 1.18 per cent more than what was reported in March 2024.
With 10,280,956 members in March 2024 and 10,315,034 in April 2024, there was a minor rise of 0.33 per cent in RSA membership.
The number of members of the RSA increased slightly by 0.33 per cent, from 10,280,956 in March 2024 to 10,315,034 in April of the same year.
The pension industry’s vital role in encouraging savings and investments has significantly impacted Nigeria’s economic growth.
The Pension fund assets have continued to witness significant surge since 2022 jumping from N14.9 trillion to approximately N19.8 trillion as of April 2024. This is an increase of N4.9 trillion or 3.9 per cent.
Victor Ezeja is a passionate journalist with seven years of experience writing on economy, politics and energy. He holds a Master's degree in Mass Communication.
