The National Pension Commission, PenCom, has said that only 10 out of 22 PFAs in Nigeria have met the N5 billion requirement by the pension industry regulator.
PenCom had recently directed PFAs to increase their minimum share capital base from the existing N1 billion to N5billion by April 12, 2022.
Speaking on the sideline of the 2021media parley organized by the Pension Fund Operators Association of Nigeria (PenOp), Head, Surveillance PenCom, Ehimeme Ohioma, opined that the recapitalization exercise is important to consolidate the PFAs in Nigeria.
He said the objective of the recapitalisation was to improve the financial stability and operational efficiency in the industry, whilst also explaining that the directive was right, as the last recapitalisation in the industry was done in 2011.
“This is the second recapitalisation done in the industry since the inception of the current Contributory Pension Scheme (CPS). It is obvious that the industry has grown, assets and contributions have increased.
“There is a need for this. They need to retain the real skilled workers. We need to attract talent. There is a need for digitalization. This will cost money too and ensure efficiency, especially with the COVID-19.
“There has been ongoing consolidation within the industry, so we do not expect any challenges in the industry, as regards the recapitalization. On or before February 2022, we expect a picture of what the industry is going to look like before the April deadline.”
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