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Business Reporter
Projects worth nearly US$187 million and $8,5 billion were accorded the prescribed asset status by the Government during the first half of the year, latest official figures show.
At law, pension funds and insurance firms are required to have at least 20 percent of their investment portfolio in prescribed assets.
The Insurance and Pensions Commission (IPEC) said the companies that were given the prescribed asset status include African Century, US$15 million for onward lending, Pure Oil, US$5 million for the import of soya beans and Crude oil to 20 March 2023, Centra West US$42,5 million for power generation, Zimbabwe Electricity Industry Pension Fund US$6,5 million for the construction of Marondera Shopping Mall and Datvest U$7,5 million for the development of residential stands.
“The industry is urged to invest in projects or financial instruments that suit their investment objectives to comply with the prescribed asset threshold,” said IPEC. “Furthermore the approved prescribed asset presents an opportunity to diversify its portfolio.”
The investments in prescribed assets by pension funds represented 8 percent of total investment in foreign currency-denominated instruments.
According to the IPEC report, foreign currency-denominated assets amounted to US$288 million, constituting 18 percent of total industry assets. This reflects a slight growth in forex business from a proportion of 16 percent in the same period last year, the report added.
The foreign currency-denominated assets of the industry were mainly invested in equities, prescribed assets, and money market investments, which constituted 72 percent.
The quoted equity investments are mainly on the Victoria Falls Stock Exchange.
The investments made by the industry in the gold-backed tokens show that self-administered funds invested 83 percent of the industry’s total investment with the remaining 13 percent put under the standalone funds. The insurance sector is yet to tread the digital gold path.
Meanwhile, IPEC said unclaimed benefits for the quarter ended June 30, 2023 amounted to $27 billion compared to $4,3 billion reported during the same quarter in 2022.
The increase in the value of unclaimed benefits was on account of investment returns on the asset supporting the unclaimed benefits. The number of members with unclaimed benefits was 98 076 compared to 106 000 recorded as of June 30, 2022.
However, the figure excludes the Catering Industry Pension Fund which had no data at the time of the report.
Standalone funds had the largest membership with unclaimed benefits at 86 percent, followed by insured funds accounting for 11 percent and self-administered at 3 percent.
It was observed that unclaimed benefits with more than 10 years accounted for 78 percent, followed by six to 10 years at 8 percent.
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