Pakistan: Call for insurers to be allowed to invest in private equity funds
Source: Asia Insurance Review | Feb 2018
The financial regulator should allow insurers, pension funds and provident funds to invest in private equity funds, said speakers at a workshop organised by USAID in collaboration with the Securities and Exchange Commission of Pakistan (SECP) in December 2017.
Pakistan-based private equity funds are far from playing their role of supporting and growing companies in different sectors of the economy. The funds are estimated to have held assets totalling US$200 million at end-2016.
The reason for this is that the SECP and State Bank of Pakistan (SBP) have framed tight regulations that have barred potential local and foreign investors from pooling into private equity funds, reported The Express Tribune.
SECP Executive Director Imran Inayat Butt said that the regulator does not allow insurers, pension funds and provident funds to invest in private equity funds as they are highly risky.
“We cannot put the public’s money at stake in private equity funds as there are people who have invested their life savings in pension funds, provident funds and insurance companies. People invest in such funds to have a peaceful life while private equity funds do not guarantee protection,” he said. A