Ikechukwu O. Ikechukwu |
Analysts have forecasted that the total savings of the National Pension Fund will hit the N9 trillion mark by year-end and grow to over N10 trillion by 2019 business year-end.
This will be in excess of the Federal government projected budget for next business year and the projected combined budgets for the governments of Ghana, Gambia and Sierra Leon.
With proper financial management, analysts are projecting that the aggregate savings and interest accruals plus returns on investments may leapfrog to about N15 trillion by 2020 business year-end.
In the first half of the current business year, the assets of the pension fund grew by over N500 billion with the aggregate assets standing at N8.14 trillion as at the end of May.
According to PenCom chief spokesperson, Peter Aghahowa, the assets rose from N7.52 trillion in December 2017 to over N8 trillion before the end of H1, adding that a large chunk of the savings have been invested in bonds and other low risk assets.
”The pension assets as at December 2017 stood at N7.52tr, it moved up to N7.8 trillion as at February and soared to N7.94 trillion in March, then to N8.14 trillion in May.”
Aghahowa pointed that N5.2 trillion, representing 70.08 per cent of the aggregate pension assets was invested in Federal Government Securities by the Pension Fund Administrators (PFAs), adding that the remainder is kept to meet the obligation of the commission to retirees
A breakdown of the investment show that FGN bonds got N3.96 trillion; treasury bills N1.68 trillion while agency bond, which include the Nigeria Mortgage Refinancing Company (NMRC) and the Federal Mortgage Bank of Nigeria (FMBN) got N6.54 billion, Sukuk bonds got N51.98 billion and green bond got N8.26 billion.
In addition, N154.02 billion was invested in state government securities while N393.27 billion was invested in corporate bonds. N8.36 billion was invested in corporate infrastructure bonds while investment in banks gulped N662.80 billion; N71.75 billion was invested in commercial papers with estate properties receiving N228.86 billion in investment.
Information extracted from the commission’s website show that other classes of assets include, “supra-national bonds, N8.21 billion; open/close end funds, N10.16 billion; mutual funds, N1987 billion; private equity fund N3727 billion; infrastructure fund, N8.95 billion and cash & other assets N96.13 billion.”