Global Financial Crisis: Pencom Moves to Safeguard Pension Assets

By Emma Ujah, The Vanguard 

November 7, 2008

Nigeria

The Director-General (D-G) of the National Pension Commission (PenCom), Mr Muhammad K. Ahmad has initiated moves to protect pension assets being managed by various players in the pension industry following the unabating global financial crisis. 

Officials of the commission held a critical meeting with Compliance Officers of Pension Fund Administrators (PFAs), in Abuja, Wednesday, to impress it on them that all measures should be taken to safeguard pension assets in their custodies, according to a statement in Abuja, yesterday.

As at the end of August, the pension assets stood at N970 billion, comprising N300 billion Retirement Savings Account (RSA), contributed by about three and half million Nigerians and the remaining comprised inherited pension assets, known as Legacy Fund.

Mr. Ahmad was quoted as saying that 80 per cent of the RSA fund had been invested in secured fixed instruments, while only 19 per cent was invested in the capital market as long term fund.

He told the officers that they had critical roles to play in ensuring an efficient pension industry that was capable of achieving the set goals of providing sustainable cushion for retirees.

Mr Ahmad said the provisions of section 68 of the Pension Reform Act of 2004 specifically required every PFA, CPFA and PFC to employ a Compliance Officer who shall be responsible for ensuring compliance with the Pension Act, rules and regulations of PenCom.

He also said the requirement of Compliance Officers was put in the Pension Act as a result of gained experience of the nation’s financial system as well as to safeguard the pension scheme, since safety of pension funds was one of the cardinal objectives of the pension reform and the National Pension Commission.

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