Photo: NSL CEO and Deputy CEO in a recent radio interview. Credit: NSL
Nambawan Super Limited is expecting a negative outcome on its 2022 returns as some of its investments have come under pressure due to the combination of high inflation, supply chain disruption, and the rise in fuel and energy prices.
This also includes the introduction of the additional company tax on the BSP Financial Group, among other global economic issues that have slowed the growth of the world economy.
Nambawan Super Limited's Chief Executive Officer Paul Sayer said although the fund has tried to balance out its investment portfolio both offshore and locally, it has still experienced challenges on both sides.
"NSL employs an investment strategy that aims to diversify risks by running a balanced investment portfolio with about 20% of its investments deployed offshore and about 80% locally. This is done to de-risk the Fund when either the global or local markets perform poorly. However, last year NSL experienced challenges on both fronts, which we expect will negatively affect our returns for 2022," Sayer said.
Following the recent announcement of Bank South Pacific's (BSP) 2022 results, the largest superannuation fund in the country is expecting at least a reduction of K50 million in its 2022 returns.
Sayer outlined in a statement that this is also owing to the additional company tax that the government has imposed on the banking sector, and particularly BSP.
"Locally the Fund had been contending with the reduction of yields from State securities, which make up nearly 50% of the Fund’s Investment Portfolio. Most of the impact of the reduction in interest rates for State securities will be seen in 2023, but we are expecting at least K50m in reduced interest income for 2022 as a result," Sayer said.
Amidst the challenges, he said the fund has also managed to deliver some positive outcomes, such as the injection of over K700 million into the country through employee exits from the public sector, which included resignations, retirement and death benefit payments, and monthly unemployed benefit payments to over 12,000 members and beneficiaries of the superannuation fund.
In terms of how NSL has worked hard to ensure its members accounts were maintained and conveniently accessed for their retirement purposes, Sayer said the fund will continue to progress investments for a longer term.
“The Board aims to approve our financials and make a decision on the annual crediting rate by March 2023, which may be less than previous years but will help in continuing to grow our Members’ savings over the long term," Sayer ended.
