Breaking news: PenCom Increases Equity Investment Limits for RSA Funds to Boost Liquidity

Nigeria’s National Pension Commission (PenCom) has announced an increase in the allowable equity investment limits for key Retirement Savings Account (RSA) fund categories. The decision, outlined in an addendum released on February 9, 2026, to the 2025 Revised Regulation on Investment of Pension Fund Assets, takes immediate effect and is aimed at easing liquidity pressures within the pension system.

The regulator highlighted that the adjustment responds to challenges faced by Pension Fund Administrators (PFAs) following last year’s regulatory overhaul. With a notable shortage of qualifying alternative assets, PFAs were struggling to fully deploy pension funds within the prescribed asset classes, leading to underutilization of investment limits and persistent excess liquidity.

Under the revised rules, the equity exposure caps for RSA funds have been increased across multiple categories: RSA Fund I moves from 30% to 35%, RSA Fund II from 25% to 33%, RSA Fund III from 10% to 15%, and RSA Fund VI (Active) from 25% to 33%. PenCom confirmed that the changes apply to all licensed PFAs and custodians immediately.

Experts welcomed the revision, noting its potential impact on Nigeria’s equities market. “Pension funds remain one of the largest pools of investable capital in Nigeria, and these incremental adjustments can significantly influence capital market liquidity and price discovery,” said Tajudeen Olayinka, CEO of Wyoming Capital Partners. Analysts expect the move to support domestic equity demand, improve portfolio yields, and potentially trigger higher turnover on the Nigerian Exchange (NGX).

This update is part of PenCom’s broader strategy to diversify pension fund portfolios beyond traditional government securities. Since September 2025, the regulator has gradually expanded allocations to equities, infrastructure, and private equity, aiming to boost returns amid high inflation and provide long-term growth for retirees. With pension-fund assets exceeding N26 trillion as of October 2025, the latest equity limits are expected to give PFAs more flexibility to optimize portfolios and strengthen the financial system.

source: nairametrics