The National Pension Commission (PenCom) has introduced new guidelines to enhance the reporting of pension fund performance, effective July 1, 2025. The updates aim to improve transparency, comparability, and accountability in managing Retirement Savings Accounts (RSAs).
Key points include:
- Standardized Reporting: Pension Fund Administrators (PFAs) must calculate returns on a rolling 36-month basis, reporting them as an equivalent annual rate to four decimal places. Non-unitized funds must use the Time-Weighted Return (TWR) method.
- Performance Benchmarking: PFAs are required to publish the Sharpe Ratio for each fund, comparing it to the three-year average yield of the 10-year FGN bond.
- Quarterly and Monthly Disclosures: PFAs must provide quarterly reports and monthly updates on their websites by the 10th day of each month.
- Enhanced Oversight: PenCom will ensure compliance and has revised relevant sections of its regulations.
These changes will allow workers to effectively compare PFAs, fostering competition and improving returns for retirees. Additionally, PenCom has recovered ₦4.57 billion from defaulting employers between Q1 2024 and Q1 2025, reinforcing its dedication to protecting contributors.
