New Delhi: The Pension Fund Regulatory and Development Authority of India has come out with a discussion paper proposing a dual valuation approach for the securities held in scheme portfolios of National Pension System (NPS) and Atal Pension Yojana (APY).
The framework aims to present pension wealth accumulation more clearly to subscribers while ensuring long-term financial stability and economic relevance, the regulator said in the discussion paper titled 'Alignment of Valuation Guidelines with the core objectives of Long-only Funds when investing in government securities and calculation of net asset value (NAV)'.
The combined assets under management (AUM) of the NPS and APY crossed ₹16 lakh crore in September and there were 90 million subscribers. The NPS was launched in 2004 while the APY was introduced in 2015.
In the consultation paper the regulator proposed to value a portion of the government securities (G-Sec) portfolio in the NPS on "accrual basis and remaining as mark-to-market".
The paper said that "dual valuation balances prudence and realism that reflects the economic purpose of the investments and simultaneously would depict stable accumulation of pension wealth in a simplified manner to subscribe". This would align pension fund investments with long-term capital formation, boosting stakeholder confidence by funding productive, long-gestation infrastructure assets, the regulator said, seeking comments till November 30.
The framework aims to present pension wealth accumulation more clearly to subscribers while ensuring long-term financial stability and economic relevance, the regulator said in the discussion paper titled 'Alignment of Valuation Guidelines with the core objectives of Long-only Funds when investing in government securities and calculation of net asset value (NAV)'.
The combined assets under management (AUM) of the NPS and APY crossed ₹16 lakh crore in September and there were 90 million subscribers. The NPS was launched in 2004 while the APY was introduced in 2015.
In the consultation paper the regulator proposed to value a portion of the government securities (G-Sec) portfolio in the NPS on "accrual basis and remaining as mark-to-market".
The paper said that "dual valuation balances prudence and realism that reflects the economic purpose of the investments and simultaneously would depict stable accumulation of pension wealth in a simplified manner to subscribe". This would align pension fund investments with long-term capital formation, boosting stakeholder confidence by funding productive, long-gestation infrastructure assets, the regulator said, seeking comments till November 30.
