The National Pension Commission (PenCom) says it is reviewing the share of funds that can be invested in infrastructure and private equity.
The move is to boost returns on retirement savings, Ibrahim Buwai, the commission’s spokesperson, told Bloomberg on Tuesday.
Buwai said PenCom is in the final stages of reviewing the limit on pension fund investments in the aforementioned asset classes, currently capped at 5 percent.
“We are not really okay with returns the way they are because inflation is having significant negative impact,” the PenCom official said.
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He said the limit being considered could be released before the end of the third quarter (Q3) of the year.
In a phone conversation with Bloomberg, Buwai said the review will significantly cut a requirement that pension fund administrators can only invest in infrastructure funds, devoting at least 60 percent of their portfolio to projects domiciled in Nigeria.
He said Nigerian pension fund managers had asked PenCom to grant them greater flexibility to invest beyond fixed-income securities, which account for 62 percent of their assets.
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The spokesperson added that the commission wants to see traction in those alternative assets to complement returns from the fixed income and the traditional assets.
