Chief executive Arthur Oginga said the firm is in talks with different companies to sell off the market intermediary business.
Old Mutual will continue with other businesses including managing pension fund assets, wealth units, and the collective investment schemes.
The financial services group has been operating Old Mutual Securities Limited licensed by the Capital Markets Authority (CMA) as part of the group’s investment banking business unit.
Old Mutual is exiting the stock brokerage business in the country to concentrate on its asset management unit.
Chief executive Arthur Oginga said the firm is in talks with different companies to sell off the market intermediary business.
Old Mutual will continue with other businesses including managing pension fund assets, wealth units, and the collective investment schemes.
The financial services group has been operating Old Mutual Securities Limited licensed by the Capital Markets Authority (CMA) as part of the group’s investment banking business unit.
The firm said the exit from the stockbroking business will see the existing clients moved to another stock brokerage firm.
“As part of the reorganisation of the group, we have carried out a review of the business that we will choose to stay on. The stock brokerage business fell outside our perimeter in the sense of synergies between the different businesses that we got,” said Mr Oginga.
“We are talking to different parties about a possible sale and nothing at this stage is signed. We hope before the end of the year we will exit that business.”
The group has other businesses, which include life insurance and property and casualty insurance.
Old Mutual joined the brokerage industry in 2010 after the acquisition of 70 percent of the Kenyan stock brokerage firm, Reliable Securities, allowing it to trade securities for individuals and institutions at the Nairobi Securities Exchange (NSE).
The entry into NSE trading model was to focus on the retail sector, at a time when the market was dominated by foreign investors.
Stockbrokers and investment banks are facing reduced fees and commissions amid the prolonged bear market and a decline in trading activity.
Old Mutual says the exit from stockbroking will also benefit the remaining businesses.
“When you are in the asset management business sometimes you want that separation in broking and asset management because you want to be seen doing things at arm’s length,” said Clement Chinaka, managing director at Old Mutual Africa.
“You also don’t want your asset manager trading via your stockbroking. Also, people may not know whether they are doing trading to raise brokerage fees. You must make sure those things are separate.”
