Unpacking Q1’24 pension industry performance

The Nigerian pension fund industry recently experienced a slight dip after 18 months of growth, with data from the National Pension Commission showing a decrease of 0.47 percent to 19.7 trillion naira as of March this year. Analysts attribute this decline to a rebalancing by Pension Fund Administrators and a higher interest rate environment. Despite this, there has been a positive shift in the appetite for equities, which rose by 5.94 percent to 2.32 trillion naira, indicating a growing confidence in the equity market among pension fund players. In a recent interview, Oguche Agudah, the CEO of the Pension Fund Operators Association of Nigeria, discussed the industry's performance and outlook for the future. According to Agudah, the spike in assets observed in December and January was driven by economic factors and currency conversions. However, as interest rates climbed throughout the year, investors began reallocating their assets from equities to fixed income securities, leading to a dip in performance in March. Despite this, Agudah highlighted overall strong growth from the previous year to the current year, with a slight setback in the first quarter.