Pension fund assets hit N14.5 trillion in October 2022

At the end of October 2022, Nigeria’s total pension fund assets reached a record high of N14.59 trillion, up 1.14% (or N164.4 billion) from the N14.42 trillion totaled the previous month.

This information can be found in the National Pension Commission’s monthly report on the pension fund business (PenCom). The fund grew enormously between January and October 2022, by a stunning N1.16 trillion.

In a similar vein, the number of Retirement Savings Account (RSA) registrations increased significantly in the review month from the 9.79 million registrations recorded at the end of the preceding month to 9.85 million.

The PFAs’ investments in corporate debt securities increased by 2.64% from the previous month to N1.53 trillion, up from N1.49 trillion.

On the other hand, PFAs decreased their real estate holdings by 4.93% from the N229.4 billion reported at the beginning of the month to N218.1 billion as of October 2022.
With N6.35 trillion, or 43.5% of all pension funds, RSA Fund II continues to make up the majority of the fund contribution, followed by RSA Fund III with N4.05 trillion, or 27.8% of all assets.

The CPFAs accounted for 10.2% of the total funds, standing at N1.48 trillion as of the review period, while existing schemes accounted for 9.9% of the total funds, increasing by N2.41 billion in October 2022 to stand at N1.44 trillion.

Following the pessimistic emotions hitting the Nigerian stock market, investments in the local stocks market decreased by N40.41 billion to stand at N828.17 billion as of the end of October 2022. The All-Share index dropped from 49,029.16 points in the prior months to 43,839.08 points in October, a 10.6% decrease.

But in November 2022, when the all-share index reached 47,660 points at the end of the month, the market recovered 8.7%.

On the other hand, as a result of the CBN raising the monetary policy rate to 16.5% at the most recent MPC meeting, which increased returns in the fixed-income market, investments in federal government debt securities have continued to rise.

Particularly, as of the review month, the pension industry’s overall allocation in FGN securities was N9.23 trillion, or 63.2% of the total funds. Additional research revealed that N8.84 trillion was invested in federal government bonds.

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In the third quarter of 2022, 30,973 RSA holders changed pension fund administrators in total, an increase of 109% over the 14,821 holders who did so in the previous quarter.

As a result of some mergers and acquisitions as PFAs attempted to reach the required minimum regulatory capital of N5 billion, which was increased from N1 billion by the Nigerian Pension Commission, the number of registered PFAs decreased from 22 to 20 as a result of the industry’s increased competition.

In addition, the whole pension fund increased by N156.74 billion in the third quarter of 2022, reaching N14.42 trillion by September 2022.

First Guarantee Pension, Premium Pensions, and Veritas Glanvills Pensions, with average returns of 2.06% and 2.01%, respectively, followed First Guarantee Pension at the top of the list of best-performing PFAs in Q3 2022.