Pension funds have raised their holding in government debt past the Sh1 trillion mark for the first time ever, new data shows, on the back of volatility in the securities market.

The returns-chasing funds doubled their investments in government securities in the six months to December 31, stashing in Sh133.33 billion compared to Sh52.29 billion in a similar period of the previous year — an equivalent of a 154.98 percent jump.

Also Read: OECD launches MENA Pension Oultook report for the fisrt time

The aggressive investment lifted retirement schemes’ holding to nearly Sh1.04 trillion as at end of last month from about Sh923.17 billion in June, the Central Bank of Kenya (CBK) statistics show.

Also Read: Nigeria: Old Soldiers At War Over Unpaid 20-Month Pension Arrears

This came at a time the Treasury tapped Sh309.57 billion through bonds and bills in the six-month period through last December, a climb of Sh147.72 billion, or 91.27 percent, compared with Sh161.85 billion in the July-December 2019 period.

Pension funds are normally the biggest subscribers to long-term government bonds given the need for assured stable returns in the long-term to service the payment of pensioners.

Also Read: Nordic pension giant picks Nordea to run $240m EM strategy

The Treasury borrowed heavily from domestic investors amid gaping shortfalls in tax collections in a depressed economy largely as a result of Covid-19 crisis that prompted tax reliefs which have were terminated last month.

Read more @Business Daily Africa