N1.5trn Equity Revaluation Drives N2.07trn Pension Asset Growth — PenCom

Nigeria’s pension assets rose by N2.07tn to N29.52tn in the first quarter of 2026, with a N1.50tn increase in the value of domestic quoted equities emerging as the principal driver of growth, according to the National Pension Commission’s Q1 2026 Quarterly Industry Report.

The industry’s total pension assets rose from N27.45tn at the end of December 2025 to N29.52tn by March 2026, representing a 7.53 per cent increase during the quarter. 

PenCom said the growth was concentrated in the RSA Active Funds, whose combined balance increased by N1.78tn, or 9.27 per cent, to N20.97tn.

The commission attributed the expansion largely to a strong equity revaluation cycle, with the value of domestic quoted equities alone increasing by N1.50tn during the quarter. 

Domestic equities became a major contributor to the increase in pension assets during the quarter as the value of holdings rose strongly.

PenCom reported that domestic equities accounted for 18.50 per cent of industry net asset value, with holdings valued at N5.46tn at the end of March.

Domestic and foreign equities jointly accounted for 19.34 per cent of pension assets, while Federal Government securities remained the largest asset class at 58.07 per cent. 

The increase in equity values was significant relative to the overall quarterly increase in pension assets, underscoring the contribution of market valuation gains to the industry’s asset growth.

Investment gains were accompanied by continued contribution inflows into the pension system.

Monthly contributions into the RSA Active Funds amounted to N1.18tn in Q1 2026, representing an increase of 7.99 per cent from N1.09tn in the fourth quarter of 2025.

The RSA Retiree Funds received N230.36bn in monthly contributions during the quarter, while benefits paid from the Retiree Funds stood at N237.08bn. 

PenCom identified investment performance as another source of portfolio growth during the quarter, with equity revaluation described as the principal driver.

Despite the strong equity-market performance, pension fund managers continued to hold the majority of pension assets in Federal Government securities.

FGN securities accounted for 58.07 per cent of industry NAV at March 31, comprising FGN bonds, Treasury bills, agency securities, Sukuk and green bonds. 

Domestic and foreign equities accounted for 19.34 per cent, while money-market instruments represented 8.83 per cent and corporate debt securities 7.62 per cent.

PenCom said the allocation to Federal Government securities continued to support capital preservation and stable carry, while the industry had begun increasing exposure to a wider range of investment instruments.

PenCom said investment returns in the first quarter were strong in nominal terms and that some RSA Active Fund categories recorded positive real returns for the first time in seven quarters on the rolling 36-month window

Funds I, II and VI Active moved above the 15.38 per cent headline inflation rate over the 36-month period, supported by their relatively higher equity exposure and the sustained rally in domestic equities. 

The commission said the next challenge was to close the gap between the returns generated across the industry and inflation, with disciplined investment execution at PFA level becoming increasingly important.

The RSA Active Funds remained the largest component of the pension industry, accounting for 71.03 per cent of total assets at the end of March.

The RSA Retiree Funds increased by N100.43bn, or 4.43 per cent, to N2.37tn, while Approved Existing Schemes increased by N147.51bn, or 4.49 per cent, to N3.43tn.

Closed Pension Fund Administrators’ assets rose by N45.83bn, or 1.70 per cent, to N2.74tn. The broad-based increase left total industry pension assets at N29.52tn at the end of Q1 2026.