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Pension trustees asked to be alert

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NBM Capital, an investment management subsidiary of National Bank of Malawi, has advised pension fund trustees to ensure that they engage modern and best practices of managing a pension fund to overcome shortterm uncertainties in the Malawi economy.

Economic analysts have forecast that 2016 will be a year of uncertainty in key macroeconomic indicators.

NBM Capi tal Business Development Officer, Innocent Mapwetekere, said if pension funds are properly managed by expert fund managers, any shortterm market fluctuations may not bring adverse impacts on the overall long-term objectives of the fund.

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“Short – term market fluctuations need to be managed not to cause major negative impacts to the pension fund unless the unfriendly environment persists in the long-term.

“A good fund manager must expertly design strategies that mitigate such negative effects to the Fund in the short-term while at the same time, the Fund is being repositioned to pursue its long-term objectives of providing sustainable income to the pensioners or their dependents,” said Mapwetekere.

He said trustees are required to approve the investment policy and guidelines together with their fund managers and thereafter ensure adherence to the guidelines.

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Mapwetekere said it is no longer relevant for fund managers to monitor and evaluate trustees.

“Fund Managers must be challenged to demonstrate that their engagement as pension fund managers is indeed valuable and meant for value creation and enhancement to the Fund.

“NBM Capital always advocates for a stand-alone pension fund setup in order to help members of pension schemes to realise full investment benefits from their pension fund savings. The setup provides full coverage of corporate governance principles that include accountability and transparency in the dealing of pension fund affairs,” he said.

NBM Capital offers specialised investment services at highly market competitive rates to private wealth portfolios, treasury management for individuals and organisations.

The company also has endowed expertise and experience in corporate finance & transaction advisory services.

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