The acting Chief Executive Officer of the Nigerian Exchange Limited, Jude Chiemeka, has lauded the collaboration with the National Pension Commission which birthed the NGX Pension Broad Index.
In a statement issued on Thursday, Chiemeka, who was days back appointed to his new role said that the index could serve as a measure of investments of the pension industry on the local exchange.
He said, “The collaboration between NGX and PenCom underscores a shared commitment to fostering transparency, compliance, and growth within the Nigerian capital market. I am pleased with the approval granted by the National Pension Commission for the NGX Pension Broad Index to serve as the benchmark index for Nigeria’s Pension industry equity investment portfolios.
“This further solidifies the credibility of the index as a reliable yardstick for evaluating the equity performance of pension industry investments.”
The NGX and PenCom launched the NGX Pension Broad Index in June 2023, to provide a broader benchmark for equities investment by the pension industry.
The Index was designed to track the performance of equity securities that adhere strictly to the profitability and dividend payment criteria, along with other parameters specifically tailored to the pension industry.
The NGX said that with its all-encompassing approach, the index imposes no limits or caps on the number of stocks it can include as constituents. It currently features 84 equities and aligns with the provisions of the Pension Reform Act of 2014 and the Amended Regulation on the Investment of Pension Fund Assets proposed by PenCom.
“The Pension Broad Index has exhibited robust performance since its launch last year. The index stands out for its well-diversified composition, encompassing high-quality stocks across key sectors, including Banking, Insurance, Oil & Gas, Consumer Goods, and Industrial Goods,” the local bourse said in the statement.
It added that the NGX Pension Broad Index is poised to play a pivotal role in guiding investment decisions and enhancing the overall stability of Nigeria’s pension industry.
On Tuesday, the NGX had rebalanced the index, a move which affected the NGX Pension Broad Index. The Pension Broad Index will welcome Geregu Power Plc and say goodbye to Glaxo Smithkline Consumer Nigeria Plc, one of the multinationals who have announced plans to shut down operations in Nigeria.
At the 2023 Made of Africa Awards organised by the NGX, the Group CEO/MD-designate of the NGX Group, Temi Popoola, affirmed that pension funds were big investors in the capital market.
Speaking within the context of the performance of the market in 2023, Popoola said, “Some people may say that in dollar terms, the returns are not quite as strong, but the reality as you all is that a lot of the capital that was in our market this year was local capital. Foreign investors left our market and pension funds are the big investors.”
SOURCE: PUNCHNG
