THE pension funds regulator has said while the effect of Covid-19 on individuals’ retirement savings is yet to be determined, funds remain solid.
“The pension fund industry remained financially sound during the period under review, with funding levels above the required limit,” said the regulator.
The Namibia Financial Institutions Supervisory Authority and the Bank of Namibia issued a stability assessment report, saying Namibian financial institutions are still safe. The stability report covers banks, pension funds, medical aid providers and insurance companies.
The conclusion on all the above institutions is: “Financial systems remained sound and resilient in 2019, despite unfavourable domestic and global economic conditions.”
As of 2019, pension funds had assets worth N$173,4 billion.
While the asset base of the funds is still solid, their significant exposure to equities has raised concerns.
“Looking ahead, circumstances in 2020 are unfavourable with investment income likely to decline,” the report said.
The pension funds industry still invested most of its assets outside of Namibia, with geographical exposure at 41% in Namibia, 35,5% offshore and 23,5% in the Common Monetary Area countries.
Email: bottomline@namibian.com.na
