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 Ksh. 813 billion while the approved issuers managed Ksh. 167 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 Ksh. 202 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, Mr. 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.
anlam Investments East Africa (SIEAL) is a leading fund manager in the region and has a strong record of accomplishment in service delivery and investment performance. As of 31 December 2018, SIEAL had over KShs 277 billion (approximately US$ 2.7 billion) in assets under management. SIEAL is part of Sanlam Ltd which is a leading financial services group with operations in more than 30 African countries and a primary listing on the Johannesburg Stock Exchange.
SIEAL has been fully operational in Kenya since 1998 and in Uganda since 2004. The firm is licensed by the Capital Markets Authority in Kenya and Uganda and duly registered with the Retirement Benefits Authority in Kenya to provide investment advisory and management services. The firm is also licensed by the Uganda Retirement Benefits Regulatory Authority.
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.
Investment in private equity and venture capital increased to Ksh. 864 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 Ksh 60 million.