By NIyi Jacobs
Nigeria’s pension industry achieved unprecedented growth in 2024, with total pension assets soaring to an all-time high of N22.51 trillion, marking a N4.16 trillion increase from N18.36 trillion in the previous year. This represents a 22.65% year-on-year rise, according to the unaudited pension fund portfolio report released by the National Pension Commission (PenCom).
The number of Retirement Savings Accounts (RSAs) also grew by 3.84%, reaching 10.58 million by the end of December 2024, with 390,899 new registrations recorded within the year.
Fixed Income Investments Dominate Portfolio
Pension Fund Administrators (PFAs) continued to favor fixed-income securities, which accounted for N18.85 trillion or 83.72% of total pension assets. Federal government securities remained the largest investment vehicle, representing N14.11 trillion (62.70%), while corporate debt securities stood at N2.25 trillion (9.98%).
Investments in commercial papers, however, declined sharply by 38.67% to N161.16 billion, following a temporary suspension in October 2024 due to regulatory concerns over non-bank capital market operators.
Equities and Alternative Investments
Total equity investments amounted to N2.66 trillion, accounting for 11.81% of total pension assets, with domestic ordinary shares leading at N2.24 trillion (9.96%) and foreign equities at N267.99 billion (1.19%). PFAs also diversified into mutual funds (N80.72 billion), infrastructure (N214.33 billion), and real estate (N283.62 billion) to mitigate risk.
Fund Breakdown: Fund II Leads with Over N9 Trillion
Fund II remained dominant with N9.24 trillion, representing 41.02% of total pension assets, serving contributors under 49 years.
Fund III followed with N5.92 trillion in assets, while Fund V recorded the lowest at N731.4 million.
Retiree Fund (Fund VI) stood at N10.48 billion, emphasizing capital preservation strategies.
Key Developments in the Pension Sector
- Lifting of Commercial Paper Suspension – PenCom reinstated pension investments in commercial papers following regulatory adjustments by the Securities and Exchange Commission (SEC).
- BVN Requirement for RSAs – From February 1, 2025, all RSA registrations and data recaptures require Bank Verification Numbers (BVN) to enhance security and transparency.
- New Leadership at PenCom – Omolola Oloworaran was appointed Acting Director-General in 2024, focusing on asset growth, expanded CPS membership, and improved pension coverage.
With sustained regulatory oversight and strategic investments, Nigeria’s pension sector remains a critical pillar for long-term financial security and economic stability.
