The National Pension Commission (PenCom) has issued new guidelines banning significant cross-shareholding in multiple licensed Pension Fund Operators (LPFOs), with immediate effect.
The regulator announced the move on Friday, explaining that it is designed to promote transparency, good governance, and stronger protection of pension assets.
According to the guidelines, significant cross-shareholding occurs when a major shareholder in one LPFO acquires, or seeks to acquire, a significant stake in another LPFO. It may also arise through indirect means such as conversion of debt to equity, transfer by law (including inheritance), or other forms of vesting.
PenCom further clarified that mergers and acquisitions outside the pension sector could also trigger significant cross-shareholding if they result in individuals or entities holding five per cent or more in multiple LPFOs.
The regulator, therefore, prohibited such practices:
“No person shall hold, or continue to hold, or otherwise enter into any arrangement or agreement that would result in holding or continuing to hold a significant cross-shareholding,” the commission stated.
The enforcement of this policy is expected to reduce conflicts of interest and safeguard the integrity of Nigeria’s pension industry.
