Executive summary for the week of 31-May-16 to 07-Jun-16 (week 23)
SEC and Pencom want more of US$27 billion Nigerian pension fund in capital market.
Securities and Exchange Commission, Pension Commission and industry operators last week agreed Nigeria must begin to invest more of its N5.4 trillion (US$27 billion) pension asset in the capital market to harness domestic potential for growth.
In the booming pension fund sector, there are concerns about constraints on the capital market’s ability to attract additional pension fund asset allocations due mainly to lack instruments that could be invested in.
Data from PenCom shows that Nigerian PFAs invest only 8.16% of their assets in the domestic listed equities market and 1.24% of their assets in foreign equities, the Director-General expressed confidence that all funds mobilised under the contributory pension scheme when invested by the PFAs is guaranteed with the objectives of safety and maintenance of fair returns on the amount invested.
Pencom hopes to unlock up to N1 trillion over the next two to three years to deepen the financial system, create employment and boost market knowledge.