Pension funds achieve impressive growth, reaches N17.7trn on diversified investment strategy

Nigeria’s pension net asset value rose to N17.7 trillion at the end of October 2023, from N15 trillion in January 2022, and this was driven by diversified investment strategy, the Pension Fund Operators Association of Nigeria (PenOp) said.

According to PenOp, 2023 was a good year for pension fund investments, represented by some of the asset classes in pension fund portfolios.

“From the commencement of the year until October 2023, ordinary shares witnessed a noteworthy increase of N58 billion, underscoring their robust performance. Simultaneously, Federal Government bonds exhibited substantial growth, marking an impressive uptick of 1.94 trillion.”

According to the Association, in contrast, there was a slight reduction of N19 billion in investments in the money market during October.

“This suggests a strategic reallocation of pension fund assets to other classes. Notably, investments in infrastructure experienced a positive surge, showing an increase of N17 billion during this period.

“These shifts in asset values signify a responsive and diversified investment strategy, optimizing the portfolio to capitalise on varying market conditions and opportunities.”

Quoting the data from the National Pension Commission (PenCom), investment in ordinary shares grew from N1.1 trillion in 2023 to N1.59 trillion at the end of October 2023, while investment in Federal Government Bond grew from N9.48 trillion in January to N11.42 trillion in October.

Whereas investment in the Money Market dropped from N1.88 trillion in January to N1.69 trillion in October 2023, infrastructure fund investment gained, rising from N113.49 billion in January to N130 billion in October last year.