Capital Markets

Unit trust schemes funds cross Sh100 billion mark

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Capital Markets Authority CEO Wycliffe Shamiah. FILE PHOTO | NMG

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Summary

  • Collective investment schemes in Kenya grew their assets under management by 38 per cent last year, taking advantage of the rising preference for investment plans handled by professional advisers.
  • Industry data compiled by the Capital Markets Authority (CMA) shows that the unit trust sector handled Sh104.7 billion assets by the end of last year, up from Sh76.1 billion in December 2019.

Collective investment schemes in Kenya grew their assets under management by 38 per cent last year, taking advantage of the rising preference for investment plans handled by professional advisers.

Industry data compiled by the Capital Markets Authority (CMA) shows that the unit trust sector handled Sh104.7 billion assets by the end of last year, up from Sh76.1 billion in December 2019.

The bulk of these assets were held in government securities and fixed deposits in banks, with a sizeable portion also in form of cash and demand deposits.

“In the quarter ended December 2020, 43.99 per cent of the total assets under management(AUM) was invested in government securities. The least amount of the AUM at 0.37 per cent was invested in immovable property,” said CMA in its first quarter 2021 bulletin.

CMA said assets invested in Treasury bills and bonds accounted for 43.9 percent of the total, equivalent to Sh46.1 billion. This was, however a drop from the 52.1 per cent share these securities accounted for in 2019, which was equivalent to Sh39.5 billion at the time.

The unit trust managers instead put their faith in banks, pumping in billions more into fixed deposits, cash and call deposits during the year.

Fixed deposits rose from Sh19.95 billion in 2019, equivalent to 26.3 per cent of total assets, to Sh36.2 billion (34.5 per cent) by the end of 2020. Cash and demand deposits rose from Sh2 billion (2.7 per cent) to Sh11.4 billion (10.9 per cent) in the review period.

Due to the bearish equities market, however, they cut their investment in listed shares from Sh9.2 billion to Sh5.6 billion.

Among the individual schemes, CIC Unit Trust managed the largest portion of the funds at Sh42.99 billion, followed by NCBA Unit Trust Scheme which managed Sh12.54 billion as at December 2020.

Britam Unit Trust Scheme dropped one place into third position with Sh12.3 billion assets under management, followed by ICEA Unit Trust at Sh11.5 billion, Sanlam Unit Trust at Sh6.28 billion and Old Mutual Unit Trust at Sh6.13 billion to round of the top six out of the 19 active schemes.