Pension funds increase to N5.7tn
The total assets under the Contributory Pension Scheme rose from N5.3tn in December last year to N5.729tn at the end of June.
The funds, which stood at N4.6tn in
December 2014, include the total amount contributed by the subscribers,
the investments and profits generated.
Figures obtained from the National
Pension Commission on Friday showed that about N3.86tn, which was 67.48
per cent of the funds was invested in the FGN securities.
The pension operators invested N561.44bn
and N494.5bn, which represent 9.8 per cent and 8.6 per cent of the
total pension funds in domestic ordinary shares and local money market
securities, respectively.
According to the PenCom report, N269.8bn
was invested in corporate debt securities and N212.83bn went into real
estate properties, amounting to 4.71 per cent and 3.71 per cent of the
total assets, respectively.
The operators invested N139.58bn and
N99.49bn in state government securities and foreign ordinary shares,
representing 2.44 per cent and 1.74 per cent of the total funds
respectively.
The report also showed that the rest of
the funds had been invested in supra-national bonds, foreign money
market securities, open/close-end funds, private equity funds,
infrastructure funds, cash and other assets.
PenCom said that as of March ending, over seven million workers had registered under the CPS.
Operators of the CPS made a profit of
about N2.2tn from the investment of the rising funds in their custody
from inception of the scheme.
The Director-General, PenCom, Mrs.
Chinelo Anohu-Amazu, said the investment of the pension funds must
follow the laid down guidelines.
“The pension funds are not idle but we
don’t just give out money arbitrarily.
The Pension Funds Administrators
are the investors of the funds and PenCom regulates the investment,” she
said.
She said if any PFA invested the funds
in assets not approved, the commission would know and could withdraw the
operator’s licence or apply some other forms of punishment.
More than a decade after the CPS commenced, the director-general said no fraud had been recorded in the scheme.
The commission said it had continued its consultative philosophy in regulating and supervising the industry.
“The risk-based examination approach was
implemented as a way of promoting transparency and providing early
warning signals as well as encouraging pension operators to regularly
self-evaluate their positions,” it stated.
PenCom gave the major issues observed
from the review of the compliance reports forwarded by the operators
during the first quarter of the financial period as un-credited pension
contributions and delays in the payment of retirement benefits to the
retirees.
It also identified the failure to fill vacant top management positions by operators as an emerging issue.
The commission said it had sent letters
to the affected operators concerening the issues and it was already
receiving responses from them.
It added that some of the issues were raised with the operators during its site examinations.
The Chairman, Pension Fund Operators
Association of Nigeria, Mr. Eguarehide Longe, also said the increasing
pension funds were not idle in the bank.
According to him, the funds are active in different investment portfolios.
He said, “We need to disabuse the minds
of politicians that there are sharp practices in the industry that the
money is in a bank account somewhere and just waiting to be taken.
We
constantly have to explain that the money is not in a bank account
anywhere; it has been invested.”
The chairman also said the industry was targeting N20tn from the scheme and 30 million subscribers in the next eight years.
He said there were ample provisions in
the investment guidelines that allowed the funds to be invested in
projects such as infrastructure, private equity and real estate.
Post a Comment