PIC assets under management exceed R2.5trn

Africa’s largest asset manager, the Public Investment Corporation (PIC), increased its assets under management (AuM) by 8.9% to R2.548 trillion in the 2021/22 financial year, up from R2.339 trillion, despite facing external challenges in the operating environment. 

Tabling its annual report on Thursday, the PIC noted that investments in listed assets – which make up 86.78% of its portfolio – delivered returns of R1.227 billion during the period. 

“The PIC’s growth and performance is grounded in a disciplined investment approach focused on delivering positive, risk-adjusted returns to client portfolios over their desired time horizon,” CEO Abel Sithole said in a statement.

Read: PIC to invest $100m in Africa Finance Corporation

Unlisted investments slump

The value of the asset manager’s unlisted investments portfolio – which makes up less than 5% of the manager’s total portfolio – took a knock, slumping 7.79% to R75.15 billion because of impairments raised during the period. 

“Disbursements for the year decreased by 60.52% to R2.25 billion compared to the previous year,” it said.

Fewer unlisted investments were carried out by the asset manager during the period, mainly due to its largest client, the Government Employees Pension Fund (GEPF), placing its unlisted investment mandate under review.

Read: GEPF investment portfolio grows 27.5%

“The target of developmental investments for South African is between R300 million and R500 million per entity although attractive investments starting at R100 million will be considered per entity. The Rest of Africa developmental investment portfolio shall mainly comprise of investments between US$20 million and US$40 million.”

The performance of its unlisted properties portfolio remains muted as the property market’s performance aligns largely with economic growth.

This portfolio, which is currently valued at R52.62 billion, is undergoing several interventions that will better position it for growth.

“Given its developmental mandate, the PIC, on behalf of its clients, has invested alongside other property developers to roll out 10 000 beds for student accommodation. At 31 March 2022, the portfolio had 1 579 student accommodation beds under its management.” 

Mpati Commission

The PIC said that as at the end of its financial year 70% of the recommendations made by the Mpati Commission of Inquiry into allegations of impropriety at the state-owned company had been implemented.

The commission, which was chaired by Judge Lex Mpati, made several recommendations related to strengthening governance and accountability processes at the PIC.

The remaining unimplemented recommendations are set to be actioned during its current financial year.

“The remaining 30% comprised matters still under investigation by, or having been referred to law enforcement agencies and, in some instances, due for implementation by third parties.”