By Peter Egwuatu
Nigeria’s pension industry Net Asset Value, NAV, has increased significantly by 24.6% on the back of rising yield on investments in Federal Government of Nigeria (FGN) securities, according to data from the National Pension Commission (PenCom).
The latest report from PenCom shows that total Assets under Management (AuM) rose Year-on-Year, Y-o-Y, to N28.04 trillion in January 2026 from N22.51 trillion in January 2025, while pension funds’ investment in FGN securities grew by 16.7 % Year-on-Year, YoY, to N16.695 trillion in January 2026 from N14.309 trillion in January 2025.
The FGN Bonds are also driving the asset concentration in government securities, constituting about 59.5 % of total pension asset.
According to PenCom, the considerable proportion of government securities in the overall AuM portfolio can primarily be attributed to PenCom regulatory limits on investments.
To further illustrate the renewed interest in government assets, pension holdings in treasury bills increased by 12.6 % YoY to N894.1 billion from N794.3 billion in January 2025.
However, the Sukuk Bonds, which comprises Hold Till Maturity, HTM, and Available for Sale, AfS, declined YoY by 9.2 % to N85.02 billion from N93.7 billion in December 2024.
Commenting on the report, analysts at InvestData Consulting Limited stated: “The high interest rate environment in 2025 and the government’s increased borrowing need to plug the 2025 budget deficit also drove the YoY growth in investments in fixed-income securities”.
Commenting as well, David Adonri, analyst and Executive Vice Chairman at Highcap Securities Limited, stated: “The rise in demand for government securities is driven by their reputation as safe-haven assets, high liquidity, attractive yields compared to other low-risk options, and increased participation from both institutional and retail. As the size of pension funds grows, obviously more of their investments will flow to FGNs. This trend is expected to continue as the investment guidelines from PENCOM mandate PFAs to channel the lion share of their funds to FGNs.”
