Unpacking Q1’24 pension industry performance
Data from the National Pension Commission shows Nigeria’s pension fund recorded its first dip in 18 months dropping by 0.47 per cent to 19.7 trillion naira as at March this year. Analysts say this is on the back of rebalancing by Pension Fund Administrators and higher interest rate environment. Meanwhile, the Pension Fund Operators Association of Nigeria says the slight improvement in the appetite for equities, which rose 5.94 per cent to 2.32 trillion naira reflects growing confidence in the equity market among pension fund players. Oguche Agudah, CEO of Pension Fund Operators of Nigeria spoke to CNBC Africa for more.
Tue, 07 May 2024 12:33:20 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- The Nigerian pension fund industry experienced a slight decline in Q1 2024 after 18 months of growth, largely attributed to rebalancing by Pension Fund Administrators and a higher interest rate environment.
- There has been an increase in the appetite for equities among pension fund players, reflecting a growing confidence in the equity market despite the overall dip in performance.
- The asset allocation strategy for Pension Fund Administrators will continue to prioritize fixed income securities, with a significant portion invested in government bonds and bills.
The Nigerian pension fund industry recently experienced a slight dip after 18 months of growth, with data from the National Pension Commission showing a decrease of 0.47 percent to 19.7 trillion naira as of March this year. Analysts attribute this decline to a rebalancing by Pension Fund Administrators and a higher interest rate environment. Despite this, there has been a positive shift in the appetite for equities, which rose by 5.94 percent to 2.32 trillion naira, indicating a growing confidence in the equity market among pension fund players. In a recent interview, Oguche Agudah, the CEO of the Pension Fund Operators Association of Nigeria, discussed the industry's performance and outlook for the future. According to Agudah, the spike in assets observed in December and January was driven by economic factors and currency conversions. However, as interest rates climbed throughout the year, investors began reallocating their assets from equities to fixed income securities, leading to a dip in performance in March. Despite this, Agudah highlighted overall strong growth from the previous year to the current year, with a slight setback in the first quarter.
Get this delivered to your inbox, and more info about about our products and services. By signing up for newsletters, you are agreeing to our Terms of Use and Privacy Policy.
