PENSION FUND REGULATORY AND DEVELOPMENT AUTHORITY
File No: PFRDA/2013/16/PFM/4 Date: 15 Oct 2013
All Pension Funds
Subject: Investment Guidelines
1. Changes in Investment Guidelines for the Government Sector
The following changes in the investment guidelines have been made:-
1.1 Debt securities selected for investments should have a minimum residual maturity period of three years from the date of investment by the Pension Fund.
1.2 Debt securities must have in investment grade rating from at least two credit rating agencies. Apart from rating by agencies, PF shall undertake their own due diligence for assessment of risks associated with the securities before investments.
1.3 Credit Default Swaps (CDS) on Corporate Bonds are eligible derivative instruments.
1.4 Rated asset backed securities (ABS) are eligible securities for investment provided they have a residual maturity of not less than three years and have an investment grade from at least two rating agencies.
2. Guidelines for Private Sector – Corporate CG and NPS Lite
Please note that both Corporate CG NPS Lite Schemes follow the Government pattern of investment and hence investment guidelines as applicable to the Government sector and any subsequent amendments to investment guidelines of Government sector will also be applicable to Corporate CG and NPS Lite Schemes. Investment guidelines, and any subsequent change thereto as applicable to the Government sector, therefore should be adopted simultaneously for Corporate CG and NPS Lite Scheme.
Chief General Manager