BY NKECHI NAECHE-ESEZOBOR-The total value of pension fund assets based on unaudited valuation reports grew from N10.33 trillion as at March 2020 to N11.09 trillion as at June, 2020, representing a growth of 7.36% in the second quarter (Q2) of 2020, the National Pension Commission (PenCom), has said.
PenCom stated this in its second quarter report, adding that the growth was mainly due to market valuation of quoted equities.
According to PenCom, the Pension Fund Portfolio by Fund type in quarter shows that the RSA funds (Funds I – V) had the largest portfolio, accounting for N8.56 trillion (77.18%) of the total assets under management.
While CPFAs and AESs assets stood at N1.37 trillion and N1.16 trillion representing 12.37% and 10.45% of the total assets under management respectively.
The commission added that RSA Fund (I) constituted 0.24% (N26.88 billion) of the total AUM, RSA Fund (II) constituted 43.01% (N4.77 trillion); Fund (III) 25.93% (N2.87 trillion); Fund (IV) i.e. the ‘Retiree’ Fund accounted for 8.00% (N886.47 billion) while RSA Fund (V) accounted for less than 1% (N32.32 million) of the Fund.
A breakdown of the pension industry portfolio indicated that the pension funds were mainly invested in Federal Government Securities, with an allocation of about 67% of the total pension assets (FGN Bonds: 57%, Treasury Bills: 9%, Sukuk Bonds: 1% while Agency Bonds and Green Bonds: less than 1%).
PenCom noted that during the quarter, the value of investments in domestic quoted ordinary shares was N524.77 billion (5% of Total Assets under Management) as at 30 June 2020, an increase of N82.82 billion (18.74%) compared to the value of N441.94 billion as at 31 March, 2020.
The increase the commission said is in the value of investments in domestic quoted equities, was primarily due to the appreciation of some stocks prices during the reporting period, as the Nigerian Stock Exchange All Share Index (NSE-ASI) appreciated by 15.05% from 21,300.47 basis points as at 31st March 2020 to 24,479.22 bps as at 30 June, 2020.
The Commission said value of investments in FGN Bonds increased by N706.41 billion (12.60%), FGN Sukuk by N27.43 billion and Agency Bonds by N0.52 billion, while investments in Treasury Bills decreased by N297.53 billion (22.58%).
Ii added that the reduction in the value of the Treasury Bills was due to maturities and reallocation to other asset classes, mainly FGN Bonds and other Money Market Securities.
