The National Pension Commission (PenCom) has reiterated that the June 30, 2012 deadline day set for the Pension Fund Administrators (PFAs) to shore up their capital base from N150million to N1billion would not be extended as earlier speculated. However, Pension Fund Operators Association of Nigeria (Penop) has expressed satisfaction in the process of the recapitalisation exercise, stating that the association was optimistic that the exercise would achieve its desirable outcome The exercise which started last year, according to the commission, would ensure that fewer but stronger operators are left in the pension business in Nigeria to guarantee safety of contributors’ fund, stressing that the PFAs had submitted evidence of compliance with the minimum capital requirement. Although, for a long period, the commission kept sealed lips over the recapitalisation update, but information from the commission stipulated that the commission had commenced the process of verifying the claims and would, within four weeks, issue a formal statement presenting the list of successful PFAs. However, companies like Crib Pension Fund Managers Limited and Evergreen pensions Limited were in the process of being acquired by another PFA, while Amana Capital Pensions Limited had since been acquired by Sigma Pensions Limited. There are indications that PFAs that are unable to meet up with the requirement before the deadline may lose their operational licence or be acquired by others. The Director-General, PenCom, Mr Mohammad Ahmad, noted. According to him, the present minimum paid up capital of N150m is no longer adequate to meet the operational requirements of the pension management business, given its huge infrastructural requirements and long development period. He said that the PFAs that might not meet the recapitalisation deadline had the option of either merging with others or be acquired by stronger ones. The PenCom boss, however, assured that such regulatory action would not affect the safety of the pension assets, saying that the increase in the capital requirement of the PFAs would encourage healthy mergers and acquisitions and promote stability in the industry. Ahmad said, “It is expected that the improved financial conditions of the PFAs, after the implementation of the reviewed capital requirement, will lead to improved service delivery, product development, improved capacity building, employment of qualified personnel and development of adequate IT infrastructure for improved business process. “The new capital will become effective from June 30, 2012 and subsequently be monitored by the commission on an annual basis at the financial year end of each PFA. Any shortfall shall be made up within 90 days.”Share