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Chuks Udo Okonta
Pension Fund Administrators (PFAs) generated total earnings of N125.39 billion in the financial year ended 31 December 2021, National Pension Commission (PenCom) has said.
PenCom disclosed this it its 2021 annual report, stating that this indicated an increase of 14.33 per cent, when compared with total income of N109.68 billion earned in 2020.
According to the pension sector regulator, total operating expenses amounted to N65.58 billion as against N55.20 billion recorded in 2020, adding that thus, gross operating profits in the industry increased from N54.78 billion in 2020 to N59.52 billion in 2021.
PenCom noted that the major source of income for the PFAs was fund management fees, which accounted for over 90 per cent of total income, adding that the PFAs recorded combined Return on Assets of 19.68 per cent and Return on Equity of 25.44 per cent. This indicated that the PFAs sustained their profitability in the year under review, it submitted.
PenCom noted that the six Closed Pension Fund Administrators (CPFAs) generated total revenue of N3.65 billion, which was an increase of 19.67 per cent, when compared with the total inflow of N3.05 billion generated in 2020.
It maintained that the major source of inflows for the CPFAs were receipts from their sponsor companies, which constituted 65 per cent of their total revenue, while management fees and investment income accounted for 32 per cent and three per cent respectively.
It said the CPFAs incurred total expenditure of N3.55 billion and a net gain of N92.44 million for the year ended 31 December 2021, adding that the operating expenses comprised mainly of staff costs, which accounted for over 65 per cent of operating expenses.