The Financial Services Commision (FSC) indicates that assets held within the Jamaican private pensions industry increased by 3.23 per cent during 2021 Q2, the second-largest percentage growth experienced since the beginning of the novel coronavirus pandemic (December 2020 – 3.74 per cent).

As at June 30, 2021, the total value of assets in the industry amounted to $695.74 billion. Comparatively, industry assets increased by 1.74 per cent to $673.97 billion in March 2021 quarter.

In comments on growth in the June quarter, the FSC stated, “The private pension industry has almost recovered to the pre-COVID levels.”

The industry experienced an average growth of 2.77 per cent per quarter over the past five years. During the quarter, total membership reported for private pension plans also increased by 0.88 per cent.

The Jamaican employed labour force also saw a 0.56 per cent increase during the period, so private pension coverage is active and all plans ultimately remain the same (11.56 per cent and 11.74 per cent, respectively).

The FSC stated that during the June 2021 quarter, monies invested in the top three asset classes — pooled investment arrangements (PIAs) , stocks and shares and Government of Jamaica securities — grew by 3.61 per cent, 6.22 per cent and 2.24 per cent, respectively.

Consequently, assets invested in PIAs were valued at $260.59 billion as at June 30, 2021, representing 37.36 per cent of total private pension assets.

Direct investments in stocks and shares, which accounted for 23.21 per cent of total private pension assets, valued $161.89 billion.

Investments in GOJ securities closed out the quarter at $149.53 billion (21.44 per cent), which is the largest dollar value for the asset class that has ever been reported, the FSC noted.

Similarly, investments in real estate and repurchase agreements were at their highest ever reported as at the end of the quarter.

Notably, deposits experienced the largest quarterly (14.11 per cent) and annual (79.15 cent) growth.

On the other hand, the value of promissory notes contracted by 38.36 per cent during the quarter. Total assets reported for the majority of the remaining asset classes increased during the period.

The FSC noted that commensurate with the positive performance reported for Jamaica’s economy during April to June 2021 by the Planning Institute of Jamaica (PIOJ), all industries saw an average increase of 3.27 per cent in private pension assets by the end of the quarter.

The tourism industry experienced the largest growth (4.98 per cent) in assets during the period, and a contraction in membership of 1.17 per cent which was partially due to the termination of a tourism-related plan.

The construction industry experienced the largest growth in membership (20.78 per cent) while the

Media/communication industry saw the largest contraction in membership (1.98 per cent), which was also partially due to the commencement of wind-up proceedings for a pension plan.