Pension funds experience a notable 22% increase, reaching N18 trillion, according to NAICOM

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The National Pension Commission reported that the Contributory Pension Scheme’s total assets reached N18.36tn by the close of 2023, marking a 22.43% appreciation in pension funds during the year.

The net assets increased from N14.99tn in 2022 to N18.36tn, with a monthly growth of 2.39% in December alone.

The report highlighted that N11.92tn of the assets was invested in Federal Government securities, constituting 64.9% of total assets.

Despite this growth, industry observers note the underpenetration, as the AUM accounts for only nine percent of Nigeria’s 2022 GDP, below the global average.

The dominance of FGN securities, especially bonds, and the positive performance of the equities market, contribute to the sector’s positive trajectory, according to analysts at Cowry Asset Management.

However, the value of pension funds declined by 45.18% in dollars due to the naira’s devaluation, impacting both pension funds and the broader economy.

PenCom emphasized that the devaluation and inflation are twin challenges affecting the purchasing power of currency.

 

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