The Director General of the National Pension Commission (PenCom), Omolola Oloworaran, has affirmed that pension assets amounting to N5.51 trillion are being strategically invested to catalyze the development of Nigeria’s real economy.
This revelation was contained in an official statement issued by the Commission on Tuesday in Abuja. According to Oloworaran, the funds are channelled into various investment classes including infrastructure, private equity, real estate, and subnational development initiatives.
She disclosed this during a high-level engagement with a visiting delegation from the International Monetary Fund (IMF), where discussions focused on the evolution of Nigeria’s pension industry and broader financial sector dynamics.
Oloworaran highlighted that the involvement of pension funds in real sector financing underscores the industry’s critical role in driving national economic growth and development. She revealed that the total Net Asset Value (NAV) of the pension fund industry rose by 22.65%, growing from N18.36 trillion as of December 2023 to N22.51 trillion by December 2024. She attributed this increase to consistent contributions and robust investment returns.
However, the PenCom boss lamented the limited availability of high-quality investable instruments that meet regulatory standards for pension investments. Presently, only 86 securities on the market satisfy the eligibility criteria outlined in the pension fund’s investment framework, including liquidity and minimum free float requirements.
This, she noted, persists despite several provisions within the Commission’s investment guidelines designed to broaden the universe of eligible instruments.
To address this shortfall, PenCom intends to deepen collaboration with capital market stakeholders with a view to expanding the range of acceptable financial instruments. The objective, she said, is to diversify investment portfolios and enhance real returns for contributors.
Oloworaran stated that the Commission is committed to bolstering alternative investment avenues, such as infrastructure and private equity, to ensure the long-term viability of the Contributory Pension Scheme (CPS).
During the meeting, PenCom provided the IMF team with detailed insights into recent industry developments, including investment strategies, asset quality concerns, funding mechanisms, and regulatory constraints. She reiterated PenCom’s strategic focus on enhancing the diversity of asset classes and ensuring regulatory compliance through partnerships with key institutions like the Securities and Exchange Commission (SEC), the Debt Management Office (DMO), and the Pension Fund Operators Association of Nigeria (PenOp).
The IMF delegation, led by Senior Financial Sector Expert, Mr. Jose Luna, expressed satisfaction with PenCom’s regulatory framework and its efforts to diversify pension fund investment. Luna commended the Commission for sustaining momentum in pension fund management and for its contribution to the resilience and growth of Nigeria’s financial sector.
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