Zimbabwe’s pensions industry significantly increased its investments in equities in the fourth quarter of 2025, buoyed by strong gains on the Victoria Falls Stock Exchange and stability on the Zimbabwe Stock Exchange.Zimbabwe trade fair
This comes as retirement funds sought to preserve value and improve long-term returns.
According to the Insurance and Pensions Commission (Ipec) pensions industry report for the 12 months ended December 31, 2025, quoted equity investments rose 32 percent to US$698.73 million from US$528.85 million in the previous quarter.
The asset class’s share of total pension sector assets also climbed to 23 percent from 19 percent in September, reflecting growing confidence in listed securities.
In its report, Ipec said the increase in quoted equity holdings was a reflection of the good performance of the VFEX and the stability of the ZSE, as pension funds adjusted portfolios in response to market conditions.
Ipec said the VFEX’s market capitalisation surged by 64 percent during 2025 to US$2.1 billion, up from US$1.28 billion in December 2024, driven by price gains in key counters and sustained demand for hard currency-denominated assets.
Turnover value on the bourse almost doubled to US$111.05 million during the year from US$56.94 million in 2024, while trading volumes jumped to 1.46 billion shares, signalling broader participation and improved market depth.
“The VFEX maintained a positive performance trajectory up to the end of December 2025, supported by continued foreign currency-denominated listings and sustained investor interest in offshore-facing assets,” Ipec said.
On the ZSE, the market also remained resilient despite signs of tighter liquidity toward year-end.
Market capitalisation rose 32 percent to ZiG87.26 billion in December 2025 from ZiG66.24 billion a year earlier, while turnover value increased 147 percent to ZiG5.43 billion from ZiG2.28 billion.
Ipec said the ZSE’s performance reflected continued investor reliance on equities as a store of value, reinforcing the role of listed stocks in pension fund strategies.
According to the report, despite the stronger allocation to quoted equities, property remained the dominant asset class in the pensions sector.
The value of investment properties, including property units, increased 3 percent to US$1.34 billion from US$1.30 billion in the previous quarter, accounting for 43 percent of total assets.
Ipec said this highlights the sector’s continued preference for real assets that generate steady income while offering some protection against macroeconomic volatility.
Meanwhile, investments in unquoted equities fell 24 percent to US$204 million from US$269.17 million in September, reducing their share of total assets to 7 percent from 10 percent.
Ipec attributed the decline to valuation adjustments and reduced exposure to less liquid instruments.
“This contraction reflects valuation adjustments and reduced exposure to instruments with limited liquidity and pricing transparency,” the regulator said.
Overall, the pensions industry’s asset mix remained concentrated in property, quoted and unquoted equities and pooled investment vehicles, which together accounted for 82 percent of total assets.
The regulator said this concentration underscores the sector’s preference for long-term growth and income-generating investments.
However, Ipec also flagged rising contribution arrears as an area of concern highlighting that pension contribution arrears stood at US$126 million at the end of December, a 26 percent increase from US$100.18 million in the previous quarter, though they remained at 4 percent of total assets.
The commission said it was intensifying engagement with defaulting employers to ensure timely remittances.
“The commission continues to encourage sponsoring employers to remit pension contributions timeously to the respective funds,” Ipec said, adding that the commission is also engaging with defaulting sponsors in line with section 16 of the Pensions and Provident Funds Act [Chapter 24:32], prior to invoking garnishing powers where necessary.-herald
