FINANCIAL SERVICES BOARD REGULATIONS
Pension funds will ‘up private equity allocation if rules changed’
Private equity in Africa an attractive option for pension funds if FSB rules are changed, says investment director
Pension funds would increase their participation in private equity in Africa if the Financial Services Board (FSB) relaxed regulations, an industry player said on Wednesday. Local participation in private equity had been somewhat crowded out by international investors and development finance institutions, said Vuyo Ntoi, an investment director at African Infrastructure Investment Managers. Regulation 28, which regulated retirement funds, was amended in 2011 to raise limits on allocations to alternative investments, such as private equity and hedge funds, from 2.5% to 15% of funds under management. Retirement funds can allocate 10% to private equity, but only 2.5% to any single private-equity investment. Infrastructure assets were ideal matches for pension fund liabilities, due to cash flow stability after construction, said Ntoi. Private equity in emerging markets also boosted economic growth and job creation, said David Cooke, a partner at Actis. "There is not as much financial eng...
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