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Pension Fund Administrators (PFAs) have invested a total of N130.18 billion funds from the Contributory Pension Scheme (CPS) in infrastructure projects as of the end of September 2023, according to figures from the National Pension Commission (PenCom). The total assets under the CPS reached N17.35 trillion during the same period.
PenCom’s figures also indicate that pension funds were invested in various instruments, including domestic and foreign ordinary shares, federal and state governments’ securities, and money market instruments.
The investment in infrastructure aligns with the amended investment regulation set by PenCom, outlining requirements for investing pension fund assets in accordance with the provisions of the Pension Reform Act, 2014. The regulation emphasizes the need for uniform rules and standards for pension fund asset investment.
Furthermore, the regulation stipulates that pension fund custodians must only act on written instructions from licensed PFAs regarding the investment and management of pension fund assets. It also highlights conditions for engaging global custodians for allowable foreign investments, requiring prior approval from PenCom.
Additionally, the regulation prohibits PFAs from outsourcing the investment/management of pension fund assets to third parties, except for specific cases allowed by the regulation, such as open/close-end/hybrid funds and specialist investment funds.
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