PenCom Extends Investment Window for PFAs by 24 Months

The Pension Commission (PenCom) has announced a 24-month extension of regulatory forbearance allowing Pension Fund Administrators (PFAs) to invest pension assets in a broader range of securities issued by parent companies. This decision, effective from July 3, 2026, reflects prevailing market realities and operational constraints limiting the availability of quality investment instruments in the domestic market.

The extension aims to expand investment opportunities while ensuring stringent safeguards to protect contributors' funds. PenCom emphasizes that this forbearance does not relax investment discipline and insists that all investments involving custodians must meet fiduciary standards.

The commission has introduced exposure limits across various RSA fund categories, including caps on equity and bond investments in parent companies. Additionally, no PFA may subscribe to more than 20% of bond issues rated above a certain threshold.

The regulatory framework aims to prevent excessive concentration of pension assets and mitigate risks associated with related-party transactions.