Economy
Pension Fund Managers Ease Exposure to Equities
By Quantitative Financial Analytics
In a bid to bolster their performance, strengthen their risk management strategies and in response to the lacklustre performance of the Nigerian stock market, pension fund managers in Nigeria have increasingly been reducing their exposure to the stock market by allocating less and less of their assets to domestic ordinary shares and more and more to FGN bonds and other fixed income securities.
Analysis of available information conducted by Quantitative Financial Analytics indicates that allocation to domestic ordinary shares has been suffering some reductions month after month since 2013.
As at December 2013, 14.58 percent of pension funds’ assets were invested in domestic ordinary shares, by the same period in 2014, investment in domestic ordinary shares had fallen to 11.79 percent.
As if that was not enough, by December 2015, pension fund managers reduced their exposure to the stock market by a further 2 percent, allocating only 9.76 percent to domestic stock market.
The downward spiral continued in December 2016 when just 8.13 percent of pension fund assets were allocated to domestic ordinary shares only for the sorry allocation to still suffer further reduction in January 2017 to stand at 7.79 percent.
As at February 28, 2017, only 7.45 percent of pension fund assets were in domestic ordinary shares showing that over the last five years or so, pension funds have reduced their exposure to the domestic stock market by 7.13 percent and it looks like they are not done yet.
At the other end of the asset allocation spectrum is the tendency for the pension funds to overweight their asset allocation to fixed income securities especially FGN Bonds.
As at December 2013, FGN Bonds and Treasury Bills accounted for 58.75 percent of pension fund assets, but by February 2017, allocation to FGN Bonds and Treasury bills has increased to 72.36 percent, an increase of 13.61 percent.
Although pension funds have been recording positive returns month after month, (in trickles though), their asset allocation as indicated above is not reminiscent of diversified portfolios and may therefore be suboptimal.
Optimal asset allocation is built on the premise that different asset classes offer returns that are not perfectly correlated and diversifying portfolios across such asset classes helps to optimize risk-adjusted returns.
It does appear however that Nigerian pension fund managers’ ability or willingness to diversify is being stymied or fettered by regulatory impediments which specify, among other things, the required maximum allocation to a given asset class.
The importance of asset allocation as a major source of investment returns has been highlighted by researchers and analysts alike.
A widely-cited study of pension plan managers has found out that 91.5 percent of the difference between one portfolio’s performance and another’s are explained by asset allocation.
Specifically, in 1986, Gary P. Brinson, CFA, Randolph Hood, and Gilbert L. Beebower posited that asset allocation is the primary determinant of a portfolio’s return variability, with security selection and market timing playing minor roles.
Subsequent research results have come to support that assertion and it is hoped that in the near future and subject to the availability of asset classes and within limits of regulatory entanglements, Nigerian pension fund managers will diversify their portfolios optimally.
By Aduragbemi Omiyale
The pre-registration training and examination for capital market operators (CMOs) for the second quarter of 2026 has been postponed.
Business Post gathered that the new date for the exercise is now Monday, June 15, 2026.
This information was disclosed by the Securities and Exchange Commission (SEC) through a circular on Monday, June 8, 2026.
The Nigerian capital market regulator stated that this postponement has also resulted in the extension of the deadline for registration to Friday, June 12, 2026.
In the notice today, the SEC expressed its regret for the inconvenience this action may cause operators, who had prepared for the initial date of the training and examination.
“Further to the recent circular on Q2 2026 Pre-registration Training and Examination, the Securities and Exchange Commission (SEC) hereby informs all eligible applicants for the Q2 2026 Pre-registration Training and Examination that the commencement date has been postponed to Monday, June 15, 2026.
“Registration on the designated portal has also been extended to Friday, June 12, 2026. All other conditions contained in the circular remain unchanged.
“The commission regrets any inconvenience this postponement may cause and appreciates the understanding of all applicants,” the disclosure noted.
By Aduragbemi Omiyale
One of the leading healthcare firms in Nigeria, Fidson Healthcare Plc, has listed additional shares on the Nigerian Exchange (NGX) Limited.
The new stocks absorbed into the stock market were 600 million units, raising the total issued and fully paid-up shares of Fidson to 3,000,000,000 ordinary shares of 50 Kobo each from 2,400,000,000 ordinary shares of 50 Kobo each.
The fresh equities came from the company’s rights issue of 600,000,000 ordinary shares of 50 Kobo each at N35.00 per share.
They were issued to existing investors on the basis of one new ordinary share for every existing four ordinary shares held as of the close of business on Wednesday, November 12, 2025.
Confirming the development, the regulator in a notice said, “Trading licence holders are hereby notified that an additional 600,000,000 ordinary shares of 50 Kobo each of Fidson Healthcare Plc were on Tuesday, June 2, 2026, listed on the daily official list of Nigerian Exchange Limited.
“The additional shares arose from the company’s rights issue of 600,000,000 ordinary shares of 50 Kobo each at N35.00 per share on the basis of one new ordinary share for every existing four ordinary shares held as at the close of business on Wednesday, November 12, 2025.
“With the listing of the additional 600,000,000 ordinary shares, the total issued and fully paid-up shares of Fidson Healthcare Plc have now increased from 2,400,000,000 to 3,000,000,000 ordinary shares of 50 Kobo each.”
By Modupe Gbadeyanka
This news will surely excite local contractors with verified claims of N100 million or less, as the federal government has approved their payments.
This approval for the disbursement was given by the Minister of Finance and Coordinating Minister of the Economy, Mr Taiwo Oyedele.
This followed a verification and reconciliation exercise designed to ensure only validated claims qualify for payment.
The beneficiaries cover contractors across multiple ministries, departments and agencies. The release of the funds is expected to enable contractors to return to project sites, pay workers, settle suppliers and meet outstanding financial commitments.
In an announcement on Monday, the Federal Ministry of Finance also said this latest batch of payments would ease liquidity pressure on small businesses and accelerate economic activity nationwide.
It was noted that the payments for verified claims of N100 million below were strategically done to spread economic impact broadly rather than concentrate disbursements among a handful of large firms.
The payments form part of a broader push to clear inherited contractor obligations, with over N700 billion verified in recent months.
“For many beneficiaries, the release of funds represents more than a financial transaction. It provides the certainty needed to sustain operations, preserve jobs, complete ongoing projects, and contribute to economic recovery and growth,” the ministry said in a statement.
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