Nigeria’s pension industry continued its steady march upward in October 2025, with total pension assets climbing to N26.66 trillion, representing a 2.19% month-on-month increase from N26.09 trillion recorded in September, and a strong 21.63% surge year-on-year.
The pension industry demonstrated sustained resilience, supported by cautious rebalancing into safer, liquid assets and sustained confidence in Federal Government securities, despite a challenging macroeconomic environment, marked by sticky inflation, FX volatility, and uncertain capital market sentiment.
The data showed that RSA enrollments grew from 10.93 million in September to 10.97 million in October, a 0.39% increase—reflecting ongoing onboarding of new entrants into the formal workforce and micro-pension participants.
FGN Securities remain the anchor, now 59.86% of total Assets
FGN instruments remain the backbone of Nigeria’s pension portfolio, expanding marginally by 1.35% MoM to N15.96 trillion. These securities now account for 59.86% of total pension assets. Key movements within FGN Securities are:
- Treasury Bills, up 11.34%, due to attractive short-term yields, prompted stronger inflows.
- Fed Govt Bonds (HTM), up 8.14%, still the largest component at N13.88 trillion, representing 52% of total pension assets alone.
- Sukuk Bonds, up 5.33%, because of the move to diversify portfolios with instruments offering attractive returns and lower risk.
- Green Bonds, up 1.68%, reflecting renewed interest in sustainability-linked instruments.
- Government securities, up 1.28% reinforce the market-wide risk-off posture as fund managers seek to safeguard value amid volatile equity and FX markets.
Money Market Instruments surge 18.85% as PFAs chase liquidity
Money market allocation recorded one of the strongest movements in October, rising from N2.42 trillion to N2.88 trillion—an 18.85% MoM increase. The category now accounts for 10.80% of total pension assets.
- Fixed deposits and bank acceptances drove the rally, surging 24.89% to N2.48 trillion, as PFAs sought higher short-term yields and liquidity buffers.
- However, foreign money market instruments plunged 44.80%, due to FX repricing and valuation impacts tied to continued naira volatility.
- While commercial papers rose by 5.61% to N328.65 billion.
Corporate Debt Instruments slip 3.41%
Corporate bonds dipped from N2.24 trillion in September to N2.16 trillion in October, contributing 8.11% to the total assets. The decline was broad-based:
- Corporate Bonds (HTM): down 3.70%
- Corporate Bonds (AFS): down 2.67%
- Infrastructure Bonds: down 7.61%
This cooling in appetite aligns with continued credit risk concerns in the private sector, elevated borrowing costs, and recent downgrades affecting select issuers.
Equities see mixed movements
Domestic equities grew 5.01%, increasing to N3.84 trillion, and accounting for 14.42% of the total assets. This is supported by bargain-hunting as investors priced in potential year-end rallies.
Foreign equity exposure, on the other hand, fell 6.45%, echoing valuation pressures and conservative FX repositioning.
Total allocation to equities (domestic + foreign) represents about 15.39% of total pension assets.
Alternative assets
The alternatives segment delivered mixed outcomes:
Mutual funds advanced 1.32% to N221.88 billion, buoyed by moderate growth of 2.22% and 0.21% in open/close-ended funds and Real Estate Investment Trusts (REITs), respectively.
- Infrastructure Funds, likewise, increased by 9.23% to N262.57 billion, signaling renewed PFA interest in real-sector diversification
- Private Equities declined by 10.53% to N233.10 billion, reflecting valuation adjustments and cautious commitments.
- Real Estate dropped sharply by 40.19% from N243.35 billion to N145.56 billion, possibly due to portfolio restructuring or markdowns.
- Supra-national Bonds retreated by 10.44% to N19.70 billion.
Cash & other assets declined sharply by 16.79% from N518.95 billion to N431.84 billion in October, reallocating into higher-yielding money-market and government securities.
Breakdown by fund category
Across the Retirement Savings Account (RSA) structure, the distribution remained consistent with historical trends, as Fund II remains the largest and most actively managed segment of the industry:
- Fund II, the default fund for active RSA contributors aged 49 and below, rose to N11.25 trillion, increasing by 2.68%. This fund contributed 42.18% to the total assets, highlighting strong inflows and solid investment returns.
- Fund III (Pre-Retiree), the default Retirement Savings Account (RSA) fund for active Nigerian contributors aged 50 and above, also increased modesty by 1.89% to N6.85 trillion, accounting for 25.71% of the total assets.
- Fund I (Aggressive), recorded a significant growth of 6.99%, to N424.11 billion.
- Fund IV (Retiree Fund), and Fund V (Micro-Pension) posted growth of 3.65% and 4.42%, respectively, while Fund IV contributed 7.58% to the total assets.
- Fund VI (Shariah), increased by 7.16% to N205.39 billion.
- Fund VI (Retiree Shariah), N21.52 billion, +4.16%, 0.08%
- Existing schemes and CPFAs contributed by 12% and 10.10% to the total asset funds, respectively, reinforcing the growth trajectory across legacy and institutional schemes.
What this means for you
October 2025 reinforced the pension industry’s steady resilience, even amid macroeconomic turbulence. The asset mix shows a sector leaning heavily into safety, liquidity, and predictable returns—evident in strong flows into FGN securities and money market instruments.
At over N26.66 trillion, Nigeria’s pension industry remains a major stabilizing force in the financial markets, with PFAs continuing to navigate the tightrope between risk management and return optimization.
