The country’s largest pension fund has got decidedly bigger and richer in the last year.
Addressing local media this week, Botswana Public Officers Pension Fund (BPOPF) Board Chairman, Solomon Mantswe described the organisation’s recent growth as phenomenal.
Beaming with pride, Mantswe revealed BPOPF has declared interest rates on its member portfolio of 23.2 percent on active member and deferred pensioner portfolio.
“This is indeed a strong performance compared to the -1 percent that we declared in the prior year. We have had a phenomenal growth in the bonus declaration interest,” he declared.
Considering the cyclic nature of the investment world, Mantswe stressed BPOPF is moving at full-speed to deliver desired investment returns for members.
“The market remains volatile with less predictability, but we are in a much better position than when the pandemic started,” said the board chair, adding the Fund remains fully diversified.
Mantswe also expressed excitement that the Fund has been managed at the lowest possible cost, explaining that for every P100 under management, BPOPF used P0.72 to deliver the services.
“The remaining P99.28 was used to create value for a member for their retirement. Our target as the board is to ensure that total expenses as a function of assets under management do not exceed P1.25 for every P100 invested by the shareholder,” explained Mantswe.
Meanwhile, BPOPF Chief Executive Officer (CEO), Moemedi Malindah stated that the Fund’s total portfolio has registered a 24.4 percent growth in the prior year, from P61.2 billion to P83.5 billion.
Painting a picture of how the Fund has been performing, Malindah said from 2011 to 2016, the annualized return was 4.66 percent, over performing benchmark of 3.87 percent.
“However, take 2011 to 2020 the annualized return was 2.88 percent versus benchmark of 3.31 percent, this was a painful experience for our members.”
Malindah said now the tables have changed and the annualized return for 2019/2020 is 3.26 percent against the benchmark of 3.25 percent.
“We are happy with this but not comfortable because we really need to do more so that members can have a wonderful experience in terms of investment returns.”