Pension funds continue to hold Namibia’s capital markets

Namibia’s investment management sector’s total assets under management stand at N$284 billion as of 31 December.

Pension funds accounted for N$119.6 billion of this amount, according to a Namibia Financial Institutions Supervisory Authority quarterly report.

“Pension funds continue to be the dominant source of capital for investment managers, representing a substantial 42.1% of the total assets under management,” says the report.

Unit trust schemes and long-term insurers accounted for 34.5% and 12.8% of the managed assets, respectively.

The remaining 10.6% of funds originate from natural persons, short-term insurers, medical aid funds, companies, and other entities.

The N$284 billion represents a 2.4% increase in managed assets which was attributed to fresh capital inflows, accrued interest and dividend income generated from existing investment portfolios.

By location, 52.1% (N$147.9 billion) of the investments remained in Namibia.

“The Majority of investments remain within Namibia.

This reflects a healthy 0.9% quarter-on-quarter rise and an 11.2% increase compared to the previous year,” reads the report.

Meanwhile, N$87.2 billion was invested within the Common Monetary Area (CMA).

“While this represents a quarterly contraction of 8.1%, it still shows a modest year-on-year growth of 2.7%,” reads the report.

Offshore investments made up 17% of the total portfolio, with the remaining 0.2% allocated to other African markets outside the CMA.

Listed equities, unit trust schemes, and listed debt continue to be the primary choices for investment managers.

These categories accounted for 30.9%, 27.7% and 24% of the total assets, respectively.

“Listed equity investments stood at N$87.8 billion in the fourth quarter of 2024,” reads the report.

Unit trust schemes grew by 11.2% quarter on quarter, while listed debt declined quarterly by 1.4% and a year-on-year decrease of 4.1%, settling at N$68 billion.

Money market instruments closed off the quarter with N$45.8 billion, which was an annual increase of 37%.

“The remaining 1.3% of assets were allocated to unlisted equity, unlisted debt, and unlisted property,” says the report.