JACK ZIMBA
Lusaka
NATIONAL Pension Scheme Authority (NAPSA), which manages the largest pension fund portfolio in the country, has signed a memorandum of understanding with credit rating agency ICRA Zambia.
The deal is viewed as a bold initiative by the pension scheme to enhance transparency in its future investment activities.
ICRA, a multinational credit rating agency based in Dubai, United Arab Emirates, serves over 200 global investors and funders who subscribe to its reports.
NAPSA director general Muyangwa Muyangwa signed on behalf of the authority, while ICRA Zambia chief executive officer and Africa head of operations David Mwambazi signed on behalf of the rating agency.
NAPSA said the MoU will help the authority to make informed decisions.
“The MoU is significant in that the credit rating information to be shared by the parties will aid the authority in making informed decisions that relate to the nature of business provided by the named institution. The bigger picture is informed decision-making,” said Cephas Sinyangwe, who is NAPSA’s head of corporate affairs.
Mr Mwambazi hailed the deal as a game-changer that will revolutionise investment oversight in the country.
“We are thrilled to announce our strategic partnership with the National Pension Scheme Authority to revolutionise investment oversight in Zambia.
This landmark MoU integrates independent credit ratings into public pension investment governance, empowering NAPSA to make informed, riskadjusted decisions,” he said.
The signing of the MoU implies that for future investments, NAPSA will have to get a second opinion before committing.
“We are excited about this milestone partnership because it brings independent credit ratings into the heart of public pension investment governance.
What this means is that NAPSA, one of Zambia’s largest institutional investors with substantial equity stakes in listed companies and fixed deposits across commercial banks, will now use ICRA’s credit ratings to evaluate corporate equity and bond issuers, assess bank creditworthiness for deposits,” Mr Mwambazi said.
He outlined other benefits of subscribing to a rating agency as: strengthened oversight in infrastructure, real estate, and private equity investments and sustainable returns with reduced risk exposure.
He said the agreement will result in increased transparency and accountability in pension fund management, and boost trust with contributors and stakeholders.
Mr Mwambazi commended NAPSA for taking the bold step, saying it shows the willingness of management to promote transparency.
“A new era of smart, secure, and sustainable investing has begun in Zambia,” he said.
Earlier this year, ICRA by Securities Exchange Commission, rated four companies for their creditworthiness. These were Zambia Reinsurance Plc, Zambeef Products, Zanaco Bank Plc and Airtel Networks Zambia Limited….https://enews.daily-mail.co.zm/welcome/home
