By Peter Egwuatu
Investments in fixed income securities rose by 17.7% Year-on-Year, YoY, in eight months, ended August 2025 to N2,405 trillion from N2.043 trillion recorded in the corresponding period of 2024.
This was disclosed in the latest pension funds industry portfolio report from the National Pension Commission, PenCom, detailing activities in the sector for the eight months ended August 31, 2025.
The fixed income or money market securities are fixed deposit /bank acceptance, commercial papers, and foreign money market instruments.
Market operators attributed the rise in the investments in money market securities to the high Monetary Policy Rate, MPR, regime established by the Central Bank of Nigeria, CBN, over the last two years.
MPR is the bench mark interest rate for government and other corporate securities in the country. The upswing in money market investments is also attributable to the relatively low risk factor in the money market securities.
Notably, due to the rising inflationary trend, the CBN had maintained high MPR, driving it up to 27.5% before a marginal drop last month to 27%.
The slight reduction in MPR, according to the market operators, was intended to support economic growth while balancing inflation control, following a period of sustained disinflation.
Vanguard’s findings revealed that the money market securities accounted for 9.28% of the total pension fund assets worth N25.895 trillion.
In the review period, the fixed income securities accounted for 77.8% of the total value of the money market securities, which stood at N2.405 trillion.
It is trailed by commercial papers which recorded N226 billion and accounted for 9.4% of the total value of money market securities.
The foreign money market instruments occupied the third position recording N102 billion, which represents 4.2% of the total value of money market securities.
Reacting to the development in pension sector, David Adonri, Analyst/Vice Chairman, said: “The Investment in Money Market Securities by the Pension Funds Administrators, PFAs is necessary because of the attractive interest rate and also, the less risky nature of the securities”.
He also said that the PFAs need to diversify their investment portfolio in order to make higher return for the investors.
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