This archive report was first published on 25 October 2021.
Kenya's pension fund sector, the largest in the region, has been hit hard by the Covid-19 pandemic, with over 1.4 trillion shillings worth of savings invested in various asset classes.
Speaking at the Sanlam Investments East Africa conference in Malindi, Capital Markets Authority Chief Executive Wycliffe Shamiah urged pension scheme Trustees to diversify their investments to maximize returns.
"As a regulator, we support this diversification of investments, and our role is to bring back investor confidence," Shamiah said. "I urge the industry stakeholders to come up with products or innovations that are attractive to our youth so that we prepare them to prefer capital markets as an investment option offering plausible returns on investments," he added.
Shamiah's call comes as the sector struggles to recover from losses incurred during the pandemic. The conference, which brings together over 100 pension funds from the East Africa region, aims to explore new investment opportunities beyond traditional asset classes.
"The sector is yet to recover from losses incurred during the pandemic, hence the need to make sustainable investments in the proposed new asset classes," said Sanlam Investments Chief Executive Officer Jonathan Stichbury. "We are looking at diversifying client funds to new investment areas like property, infrastructure bonds, and sustainable developments projects," he added.
The Kenyan government has lifted the 10 PM to 4 AM curfew, which is expected to inject more impetus to the business recovery in Kenya. The reopening of the economy and new COVID-19 mitigation measures are expected to aid in the recovery of the pension industry.
