Pensions fund asset base grows 452%
THE pensions industry’s asset base for the quarter to March 2023 increased by 299 percent to $488 billion mainly driven by growth in the value of quoted equities and investment property.
The Insurance and Pensions Commission of Zimbabwe (Ipec), in its quarterly report to March 2023, said the real increase in industry assets was 113 percent.
Investment properties accounted for $924 billion of the total value as of March 2023 compared to $163 billion during the comparative period last year, which was a nominal increase of 467 percent.
Equities nominally increased by 375 percent from $261 billion in March 2022 to $626 billion as of 31 March 2023. “This was mainly attributable to fair value gains and additional investments in equities from the contributions received by pension funds,” Ipec said.
During the quarter under review, prescribed assets amounting to $115 billion, constituted six percent of the industry’s total assets.
Ipec said this was a nominal increase of 541 percent from the prescribed assets investments of $18 billion, which constituted five percent of total assets as at 31 March 2022.
The increase was attributed to the additional investments, returns, and fair value gains in prescribed assets investments towards achieving the regulatory minimum compliance level of 20 percent.
The commission said it continues to enforce industry compliance with the approved instruments. The total income for the year to 31 March 2023 was $387 billion compared to $136 billion for the year to 31 March 2022. This translates to a nominal increase of 185 percent and a real increase of 52 percent.
Ipec said total income was mainly driven by fair value gains on investments, contributions, and profit on disposals, which constituted 68 percent, 11 percent, and six percent of total income, respectively.
“The remaining 15 percent comprises interest from investments and other income,” reads the report.
The industry’s total expenditure was $28 billion, with 75 percent of the total amount going towards benefits payments. The commission said total expenditure growth reflected a nominal increase of 261 percent from $8 billion for the same period during the prior year.
Total expenditure increased by 92 percent in real terms. During the quarter under review, the industry’s total membership including beneficiaries, decreased to 952,444 from 954,403 as at March 2022.
According to Ipec, the decrease was mainly attributable to dissolutions and exits by fund members during the period under review.
-BH24
