There is 20% of total pension assets, which translates to about N2.3 trillion of pension funds, available for investment in the real sector, the Director-General, National Pension Commission (PenCom), Mrs Aisha Dahir-Umar, has said. This, she said, is available via asset classes such as infrastructure funds, infrastructure bond and corporate infrastructure bond. The PenCom boss, who was represented by Deputy Zonal Head, National Pension Commission (PenCom), Sola Adeseun, spoke at the Annual Conference of Insurance and Pension Journalists at the Four Points in Lagos.
She stated that the N2.3 trillion represents 20 per cent of portfolio limit out of the total pension fund, which stands at N11.3 trillion as at August 31, 2020. Speaking on the theme: Promoting Bankable Investments Portfolio for Insurance and Pension Sectors, she noted that the Commission along with pension operators are desirous of ploughing some of these funds into the real sector. She noted that investment of the funds in the real sector will create more job which means more people will be employed and come under the Contributory Pension Scheme (CPS) and will further grow the asset under management.
She said “The Commission itself is desirous of ploughing some of these funds into the real sector because we believe it will be a win-win situation for everybody. It will create more jobs. This means that more people will come under the scheme as contributors and will further grow the asset under management.
“PenCom as the regulator in the pension space in Nigeria has a guiding regulatory philosophy. Our primary objective in our oversight function is that the safety of funds is very key while fair returns on the investment is also something we look at. So, it’s from this perspective that we came up with regulations that guide the investment of pension funds in the investment space. These regulations are always looked at in conjunction with stakeholders. She, however, disclosed that the Commission is working with stakeholders at how they can work with the investment regulation to suit the peculiarities of our time.
“But of course, we know this uncertain time where investment rate is going down but historically; we know that those are safe havens for pension assets. We hope to involve more instruments. I can say that we have reliable investment classes that tilts towards the real sector in the investment regulations of the Commission but they have not been accessed because investors have not been able to meet the criteria that the pension funds require in terms of safety.
“..We have up to 20 percent of the total asset under management that can be accessed via investment in this critical real sector but we don’t have instrument that will be able to make us access such”, she added.
Source: The Nation