NSSF Kenya Doubles Investment in State's Debt Securities
The National Social Security Fund (NSSF) more than doubled its holding in government securities in five years, signalling a leaning towards higher guaranteed returns in a market where listed equities have generated lower returns and increased volatility.
Latest industry statistics show the State-owned pension fund has grown its stake in Treasury bonds and bills to Sh170.9 billion last year from Sh83.2 billion in 2017.
The government debt instruments have fixed cash returns ranging from 7.4 percent to 15 percent depending on the duration.
Government securities made up 58.86 percent of NSSF's Sh290.3 billion assets in the review period, a sharp rise from 39.76 percent of the Sh209.26 billion portfolio in 2017, according to the report by the Retirement Benefits Authority.
NSSF–which has hired six privately-held asset managers to oversee the investment of 82.9 percent of its portfolio –increased its allocation to government securities last year by Sh20.39 billion from an average of Sh25.93 billion in the prior two years.
This came in the year pension funds recorded the biggest growth in lending to government among the major investor groupings like banks and insurers as they searched for guaranteed returns in the wake of Covid-19 shocks on earnings.
(Source: Business Daily Africa)
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