NSSF portfolio grows to Sh135 billion

The National Social Security Fund (NSSF) recorded a 22 per cent jump in the value of its investment portfolio in 2013 as its total net assets grew from Sh110 billion to Sh135 billion.

The latest financial figures for the year ended June 2013 and certified by the Auditor-General show that the value of NSSF’s investment portfolio now stands at over Sh135 billion compared to Sh110 billion in 2012 and according to NSSF chairman Adan Mohamed, the growth is attributable to governance and financial reforms the Fund has been carrying out over the last five years including outsourcing investment of workers’ contributions.

“The reforms we are currently undertaking have set the NSSF on a firm growth trajectory. The ongoing implementation of the NSSF Act 2013 is the most significant of a raft of reforms that commenced in 2009,” said Mohamed.

The NSSF Act 2013 replaced the old NSSF Provident Fund and created two new funds, the NSSF Pension Fund targeting mostly employees in the formal sector and civil servants, and the NSSF Provident Fund to cater mainly for the self-employed and informal sector workers.
Mohamed announced that contributors to the Fund will now earn 12.5 per cent interest on savings, up from the current 7.5 per cent.

“Our contributors will be the biggest beneficiaries of this stellar performance,” said Mohamed.

Besides implementing the NSSF Act 2013, which sets strict governance and financial management rules, the Fund has now appointed independent fund managers to manage its asset portfolio unlike in the past when this was a function of the management.

“Our investment returns have grown by between 17-20 per cent since the fund managers came on board,” said NSSF Managing Trustee Richard Langat.

Re-alignment of its portfolio to comply with legal provisions capping investment in land and property at 25 per cent has seen NSSF shift focus to other asset classes such as Quoted, Unquoted Stocks, Government Securities and Commercial Paper with a combined value of over Sh87 billion or 67 per cent of the Fund’s total portfolio as at June 2013 up from Sh64 billion the previous year.