Strategic Collaboration to Expand Investment Opportunities in Gold-Backed Securities
The Lagos Commodities and Futures Exchange (LCFE) has taken a significant step in collaboration with the National Pension Commission (PenCom) to explore new investment opportunities in gold-backed securities through Nigeria’s commodities exchanges. This partnership is aimed at creating innovative financial instruments that can attract long-term capital and contribute to economic growth.
Regulatory Milestone and Market Implications
A landmark forum was recently held, marking a pivotal moment in Nigeria’s financial landscape. The event followed the release of the revised Regulation on Investment of Pension Fund Assets by PenCom in September 2025. This regulation now officially includes gold-backed instruments as approved options for pension fund investments. This development is seen as a major milestone in deepening capital market participation and fostering sustainable economic growth.
The forum brought together key stakeholders from various sectors, including pension, financial, and commodities industries. Discussions focused on the implications of the revised regulations and practical strategies for leveraging these changes to enhance market participation.
Key Tools for Market Growth
During the forum, Gold-Backed Exchange-Traded Funds (ETFs) and other regulated commodities instruments were highlighted as essential tools for boosting pension fund participation. These instruments are expected to strengthen market liquidity and promote transparency and good governance across the commodities ecosystem.
Akin Akeredolu-Ale, the managing director and CEO of LCFE, emphasized the transformative potential of the revised Section 5.9 of the PenCom Investment Regulation. He stated that this revision allows Pension Fund Administrators (PFAs) to invest in gold-backed ETFs and other regulated commodities instruments listed on recognized exchanges such as LCFE.
“This progressive development aligns perfectly with our mission to unlock new investment opportunities that connect long-term funds to Nigeria’s real sector — while promoting transparency, value creation, and financial innovation,” Akeredolu-Ale said.
Strengthening Partnerships and Innovation
Representing the director-general of PenCom, Omolola Oloworaran, Abdulqadir Dahiru, head of the Investment Supervision Department at PenCom, praised the strategic collaboration between LCFE and PenCom. He emphasized that the partnership reinforces PENCOM’s commitment to driving innovation and plays a critical role in deepening Nigeria’s investment markets while creating new opportunities for pension fund growth.
“Pension funds represent the largest single pool of patient capital in Nigeria, and our revised regulation, which now recognizes gold-backed instruments as eligible for pension fund investment, underscores the Commission’s confidence in the emerging commodities market framework,” Dahiru said.
Role of the Securities and Exchange Commission
John Abutu, head of Legal at the Securities and Exchange Commission (SEC), representing the Commission’s director-general, Dr Emomotimi Agama, highlighted the SEC’s proactive and innovative approach. He noted that the commission has established a dedicated committee to oversee derivative trading in the Nigerian capital market. This includes developing regulatory frameworks, ensuring market integrity, monitoring risk management practices, and fostering investor confidence to support the growth of Nigeria’s derivatives and commodities markets.
Expert Insights and Future Prospects
Panellists, including Gbenga Awe, acting chairman of Commodities Tradenet Limited, and Akinbola Akintola, head of Investment and Research at Pension Operators of Nigeria, discussed the potential and strategies for gold-backed securities as a vehicle for portfolio diversification and long-term wealth creation.
The forum highlighted the increasing synergy between Nigeria’s pension industry and commodities market, underscoring the role of gold-backed investments as a stable and profitable asset class for institutional investors.