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Retirement Benefits Authority CEO Nzomo Mutuku (left) poses for a group photograph with Sanlam Investments East Africa CEO Jonathan Stichbury (centre) who recently won the Paul Sigsworth Award as Capital Markets Authority CEO Mr Paul Muthaura looks on. The Paul Sigworth Award is organised by the Fund Management Association (FMA) of Kenya in memory of former ICEA Lion Asset Management CEO the late Paul Sigsworth, who until his untimely demise in May 2015, was well known for being straightforward, upstanding and not willing to accept lower standards when it came to ethical behavior.

Kenya

Sanlam investments E.A maintains pension fund management market share lead

NAIROBI, May 16 – The Retirement Benefits Authority has announced an 8 percent year-on-year increase in the total assets under management by fund managers and approved issuers in Kenya.

According to the recently released RBA Retirement Benefits Industry report for December 2018, 16 fund managers and 15 approved issuers, submitted 1,236 scheme reports with a total fund value of Ksh. 980 billion representing an 8 percent increase compared to the December 2017 values.

The report further confirms that the total assets managed by fund managers amounted to Sh813 billion while the approved issuers managed Sh167 billion at the end of December 2018.

In terms of investments by fund managers and approved issuers, Sanlam Investments East Africa Company Limited (SIEAL) maintained its industry lead as the fund manager with the largest pension scheme assets under management, totaling Sh202 billion which constitutes 20.6 percent of Kenyan pension sector assets.

The RBA report states that “the retirement benefits sector is expected to grow this year given the relatively stable political environment and the gradual recovery of the stock market.”

While commenting on the report, Sanlam Investments East Africa Limited, Chief Executive officer, Jonathan Stichbury, said the firm is also “forecasting pension sector growth this year despite the potential challenges arising from the delayed long rains”.

“Increased food imports and reduced cash crop exports would normally be expected to exert pressure on the Kenya Shilling. However, this is likely to be mitigated by the high levels of forex reserves held by the Central Bank, strong diaspora remittances and proceeds from the recent Eurobond issue,” he noted.

According to the RBA report, schemes are also expected to venture into alternative assets given the broadening of the allowable investment categories and take advantage of the public infrastructural projects and more so under the big four agenda.”

The RBA report further indicates that government securities still accounted for the biggest share of the industry assets at 39.4 percent, followed by immovable property at 19.7 percent and then investments in quoted equities at 17.3 percent and investments in guaranteed funds at 14.4 percent.

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Investment in private equity and venture capital increased to Sh864 million in December 2018 to account for 0.07 percent of the total pension sector assets, while investments in Commercial Paper and non-listed bonds decreased by 297 percent to Sh60 million.

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