Owing to an elevated interest environment, recent data from the National Pension Commission (PenCom) revealed that PFAs’ asset allocation to money market instruments improved, with a robust year-on-year (y/y) growth of 33 per cent to N2.2 trillion.
This is even as the total assets under management (AUM) of the pension industry increased by 23 per cent y/y to N22.5 trillion in December 2024.
This represents an increase of N4.2 trillion from the previous year. The industry’s performance has been consistently strong, with only a brief moderation in March 2024.
Analysing the data, total pension assets accounted for approximately 8 per cent of Nigeria’s GDP in 2024, indicating the industry’s potential for further growth.
Underpinning the improved y/y gain in total AUM was pension funds’ investment in FGN securities, with a robust growth of 18 per cent y/y to about N14.1 trillion in Dec 2024.
Driving the asset concentration in government assets was the FGN Bonds, which constitute about 53 per cent of pension AUM. In terms of value, PFA’s holding of FGN paper increased by 5 per cent y/y to N12.0 trillion.
