The total value of pension assets in the country dropped by N51.30 billion in the month of February 2021 and that is according to the National Pension Commission (PENCOM). According to the report, the pension assets dropped from N12.299 trillion in January to N12.247 trillion in February.
The figure was N12.306 trillion in December last year. However, PENCOM blamed the development on the depreciation in the prices of Fixed Income Securities (FISs). Fixed-income securities provide investors a return in the form of fixed periodic payments and the eventual return of principal at maturity.
The regulator pointed out that the trading portfolios of the Approved Existing Schemes (AES), Retirement Savings Account (RSA) Funds II & IV and Closed Pension Fund Administrators (CPFA) fluctuated based on the supply and demand of the underlying securities.
It said: “The values of the bonds in the trading portfolios fluctuate based on the supply and demand of the underlying securities as well as the outlook of the financial market.”
Analysis of the fund showed that the bulk of PENCOM’s investment continued to be invested in the Federal Government’s securities. Despite the decline, the regulator revealed that there was an increase in the number of registered contributors from 9.237 million in January to 9.265 at the end of February.