House Committee proposes 20% investment cap for trusts

The House of Representatives Committee on Capital Market and Institutions has proposed a 20% cap on investments in a single issuer to prevent excessive concentration of trust assets and strengthen beneficiary protections. This proposal is part of the Trustee Investment Bill, 2026 (HB 2762), which seeks to repeal and re-enact the Trustee Investment Act of 1957.

During a public hearing at the National Assembly in Abuja, committee chairman Hon. Solomon T. Bob stated that the existing law is inadequate due to the growth of Nigeria’s capital market, valued at over N80 trillion, and pension assets exceeding N30 trillion. The bill allows trustees to invest in various assets, including corporate bonds and equities, but imposes stricter controls.

It mandates adherence to principles of loyalty and prudence and allows for professional delegation of investment functions. Speaker Hon. Abbas Tajudeen emphasized the need for reform to protect trust assets while warning against overly restrictive regulations that could hinder wealth creation.