Updated on July 11, 2024: Expanded content to include compliance obligations for fund managers, a regulatory framework overview, and detailed steps to obtain a fund manager license in Kenya, ensuring comprehensive guidance for potential investors and fund management entities.
There are over 20 fund managers in Kenya. They include banks and insurance firms that oversee mutual funds, conduct research and make investment decisions on your behalf.
A fund manager is typically a firm involved in the management of funds or assets on behalf of individuals, investors, or an organization.
In most situations, the fund managers manage funds from retirement benefit schemes.
Fund management covers all functions that maintain the value of any entity.
They can include tangible assets like real estate or intellectual property and goodwill.
The firms are controlled and regulated by the Fund Managers Association (FMA) of Kenya and the Capital Markets Authority.
Top Fund managers in Kenya
Here is a list of top Fund managers in Kenya:
1. CIC Asset Management
CIC asset management is an arm of the CIC Insurance limited. The income fund is a moderate to medium risk investment.
It invests in income securities issued by the Kenyan government.
The Capital Markets Authority also controls it. The fund is suitable for investors seeking a reasonable current income as well as steady capital growth.
CIC ranks among the most successful asset management firms in Kenya. The Group boasts of the capital of about 2.1billion and 3.1 million across the East African Region with a vision to expand its footprints to Central Africa.
Yearly return projections for investors range between 10 to 12 per cent with a possible investment of 1.15M cash above investment.
2. Britam Asset Management
Part of Britam Investments Limited, the fund was launched in 2004 to fill the gap in the fund management and investment advisory services and licensed by the CMA and the Retirement Benefits Authority (RBA).
Britam asset management arm operates as a diversified financial service group.
The asset management arm has interests across Eastern and Southern Africa region with full operations in Kenya, Uganda, Rwanda, South Sudan, Tanzania, Malawi, and Mozambique.
The Group offers insurance, asset management, wealth management, discretionary portfolio management banking, and property investment products.
Currently, the fund has over 158 billion in assets in management for institutions and retail clients. Some of them include pension schemes.
The company is entrusted with over $1 billion in assets under its management by major clients it serves.
Read: Hedge Funds in Kenya
3. ICEA Lion Asset Management
ICEA Lion is one of the largest fund managers firms with assets estimated to over Ksh100 billion.
The fund is a one-stop financial service provider offering a range of insurance products, including pensions, trusts, and investments.
ICEA Lion fund manager boasts as the only fund manager in Kenya that has a 30-year track record of property development and investment in Kenya.
It also bolsters as one of the asset managers with a property portfolio valued at Ksh 12billion.
Besides that, the company actively engages in seeking to provide alternative investment opportunities for its clients that include private equities with a Ksh 106 billion assets already under management.
With the product, you can choose to invest in money markets, bonds, fixed income portfolios, equities, balanced portfolio, and offshore investments.
The fund focuses on meeting the specific needs and goals of high net worth individuals, trusts, foundations, and institutions.
4. Old Mutual Fund Management
The UAP Old Mutual Group is an integrated Financial Service business comprising Faulu Microfinance Bank, UAP, and Old Mutual.
The Group, which is operational in East Africa services to more than 1.2 million customers across Kenya, Uganda, Tanzania, Rwanda, and South Sudan.
The UAP Old Mutual Group operates as an integrated financial service provider firm comprising UAP and Old Mutual and Faulu Microfinance banks.
The Group has over 1.2 million customers in Kenya, Uganda, Rwanda, South Sudan, and Tanzania.
The UPA Old Mutual fund manager is an arm of the UAP Old Mutual group. It offers a diversified choice of financial solutions to investors, individuals, and institutions.
The asset manager has footprints across 17 African in East, Central, and Southern Africa countries, including Kenya and South Africa.
The company plays a significant role in the investment industry.
The firm is an asset passionate about helping its customers achieve their financial goals through the vast experience it has acquired over the years serving in insurance.
It is part of 16 market-leading fund groups that continue to meet higher standards of service.
In addition to that, investing with Old Mutual fund manager gives you access to 1,700 investment funds and more than 120 fund managers.
5. Alpha Africa Fund Management
Alpha Africa Asset Managers Limited operates as an asset management firm based in Kenya, officially incorporated in the year 2012 to offer a wide range of investment services to investors and corporations.
It is licensed by the Capital Markets Authority (CMA) and the Retirement Benefits Authority (RBA).
The firm is committed to creating investment opportunities for the African continent. Alpha Africa invests in short term liquid funds with a maturity of not more than 12 months.
Alpha group also offers knowledge and access to high-yielding markets to its clients. It also provides extensive wealth creation and financial service to its customers.
The Group also includes asset classes that are tailored to create wealth for its clients that ensure the safeguarding of their assets.
6. African Alliance Kenya Investment Bank
The Group is an investment bank headquartered in South Africa. The Group has operations across Africa, majorly in Kenya and South Africa.
The bank offers brokerage services, wealth management services, privates equities, third party administration, economic research, among others.
African Alliance Kenya is a subsidiary of the African Alliance group and is listed by NSE and also a member of the Capital Markets Authority (CMA) and the Retirement Benefits Authority (RBA). The firm prides itself on investment interests across Africa.
Africa Alliance has over 1 billion of assets under management. Some of its major clients include government institutions, parastatals, pension and endowment funds and among others.
7. Sanlam Investments
Sanlam investment is an arm of the Sanlam Group formerly Pan African Life Insurance. The Group is a licensed life insurance and credit provider.
It has active operations in Uganda and Kenya with interests across Africa.
The Sanlam Asset Management arm launched in Kenya in 2006 to compete with then slowly growing asset management segment in the country.
The Asset Management arm has a record of tremendous experience in managing investment assets in the African continent since 1954.
Sanlam is a global asset manager with clients assets in over $79 billion. The investment firm offers a wide range of investment products, including asset management, to help clients grow.
Their main goal is to meet your dreams while allowing you to enjoy the lifestyle you want. Their products typically accommodate different investor risk and return preferences.
Read: Mutual Funds in Kenya
8. Madison Asset Management
Madison Fund Management services operate separately as an of Madison Insurance Limited.
It is fully licensed by the Capital Markets Authority and the Retirement Benefits Authority. It offers investment services to institutions and high net worth individuals.
As of 31st December 2014, Madison managed investment assets amounting to over Ksh3.5 billion and pension investments amounting to over 2.0 billion.
The fund works to achieve long-term capital growth for investors through investing in a diversified portfolio of various asset classes for both local and international markets.
9. Apollo Fund Management
Apollo fund manager has been in operation since 1990. It is one of the largest fund managers in Kenya. A subsidiary of Apollo Investments Limited, a Kenyan based insurance, and property management company.
Apollo fund manager uniquely sorts to create opportunities for investors through the market cycles. Their investment plan revolves around superior readjusted results to meet the clients’ needs.
The fund management arm focuses on meeting the needs of individual investors and institutions, among them pension schemes, SACCOs, and collective investment funds.
10. Amana Capital Limited
Amana Capital operates as an asset management firm licensed and regulated by the Capital Markets Authority. The firm has been actively working since 2003.
Amana prides in giving clients moderate means of investment while promising total security over investor’s funds. They manage money on behalf of individuals, families, and corporate organizations.
With Amana Capital, you get flexible opportunities as an investor. For instance, you can manage multiple accounts from a single master account. They also help you achieve your accounts quickly through the access of the international partners and financial institutions.
Read: Money Market Funds in Kenya
Other Fund Managers
- Zimele Asset Management
- Fusion Investment Management Ltd
- Cannon Asset managers Ltd
- Dry Associates Ltd.
- Co-op Trust Investment services Ltd
- Nabo Capital Investment service
Key Responsibilities of a Fund Manager
Fund managers have several essential responsibilities to ensure effective fund management and growth:
- Investment Strategy Development: Crafting and implementing prudent investment policies to manage the fund’s assets.
- Fund Valuation and Pricing: Regularly assessing the value of the fund and setting transaction prices in line with the information memorandum. Prices should be published daily or, if not dealing daily, at least monthly and three days before the transaction day.
- Handling Investor Transactions: Managing investments and redemptions for investors and providing transaction confirmations. Funds received should be transferred to the trustees within 30 days.
- Issuing Ownership Certificates: Distributing certificates of entitlement every 30 days to confirm holders’ ownership of units or shares.
- Dividends and Financial Reporting: Preparing and distributing dividend payments and financial statements to investors.
- Price Disclosure: Conducting regular fund valuations and publishing the buy and sell prices for unit trust investors.
Why Fund Managers Are Important
Fund managers are essential because they help the company monitor their assets in a more systematic approach.
Fund managers can assess the companies productivity from time to time and also can advise the company on the new market developments.
They help the company, individual keep track of all assets if they are many and unmanageable.
They create an efficient operation with the ability to track performance while also providing an opportunity to plan against future risks.
Compliance Obligations for Fund Managers
Fund managers must meet several compliance requirements to ensure transparency and protect investor interests:
- Appointment of a Custodian: Fund managers managing discretionary funds must appoint a custodian for the assets.
- Financial Statement Publication: Financial statements must be published in at least two nationally circulated newspapers.
- Financial Information Display: Display audited balance sheets, profit and loss statements, auditor’s reports, and a list of directors.
- Professional Indemnity Insurance: Maintain insurance coverage based on the funds under management.
- Financial Standards: Maintain shareholder funds of Kshs 10 million and the higher of Kshs 5 million or 8% of liabilities in liquid capital.
- Conflict of Interest: Act in the fund’s and investors’ best interests, avoiding conflicts of interest.
- Independent Auditor: Appoint an independent auditor with a valid practicing certificate from the Institute of Certified Public Accountants of Kenya (ICPAK).
Regulatory Framework in Kenya
Fund managers must operate within the framework of various laws and regulations:
- Capital Markets Act
- Investments and Financial Analysis Act No.13 of 2015
- Capital Markets (Licensing Requirements) (General) Regulations, 2002
- Capital Markets (Corporate Governance) (Market Intermediaries) Regulations, 2011
A valid license from the Capital Markets Authority (CMA) is required to operate as a fund manager.
Steps to Obtain a Fund Manager License in Kenya (CMA Checklist)
To apply for a fund manager license, the following documents and steps are necessary:
- Application Form: Fully completed and submitted in duplicate (Form 1).
- Certificate of Incorporation: Certified copy.
- Memorandum and Articles of Association: Certified copy with authorization for the business activities.
- Financial Records: Six months of unaudited accounts plus two years of audited accounts, if available.
- Paid-Up Capital: Evidence of at least Kshs 2,500,000 in paid-up share capital.
- Shareholders’ Funds: Evidence of at least Kshs 2,500,000 in shareholders’ funds.
- Liquid Capital: Evidence of the higher of Kshs 1,000,000 or 8% of total liabilities in liquid capital.
- Business Plan: Detailed description.
- Board of Directors: Minimum of three directors, with at least one-third being independent and non-executive. The Chairman must be a non-executive director.
- Company Secretary: Provide the name and ICPSK number.
- Shareholding Structure: Details of shares, percentage holding, and beneficial shareholding of all corporate shareholders and existing trusts, if applicable.
- Chief Executive: Name and competencies.
- Financial Projections: For three years.
- Operating and IT Systems: Description of current or planned systems.
- External Auditor: Details of the appointed auditor.
- Business Premises: Description.
- Staff Details: Including risk management, compliance officer, and internal audit functions as required by Corporate Governance Regulations.
- Directors’ Declaration: As required under paragraph 1(e) of the application form.
- Board Charter: Confirming responsibilities for strategic plans, risk management, and internal controls, addressing conflicts of interest, and identifying key risk areas for monitoring.
- Separation of Roles: Clear delineation of responsibilities between the chairman and chief executive.
- Employee Policy: Policy for employee appointments.
- Risk Management Framework: Comprehensive framework.
- Business References: Two letters of business reference and one letter of bank reference.
- Curriculum Vitae: For directors and key personnel.
- Fit & Proper Form: Completed and signed for directors and key personnel.
- Police Clearance Certificates: Valid certified copies for directors and key personnel.
- Application Fee: Kshs 2,500.
FAQs – List Fund Managers in Kenya
How do fund managers raise money?
Sometimes fund managers offer “seed investment arrangements” to initial investors. In exchange for a substantial investment in the fund, the investor receives a discount on fund management fees or a partial ownership interest in the fund. These initial investors often do their own networking to solicit other investors.
How do I find a good fund manager?
A good rule of thumb is to search out managers who have logged at least 10 years as an analyst or manager and 5 years as a portfolio manager. If the fund manager previously ran other funds, take a good look at the records of those funds to see how they fared against others in their peer group.
How much does a fund manager cost?
On average, expense ratios for mutual funds can range from around 0.5% to 2% of assets under management. Hey, the average cost of having a professional portfolio management company like a mutual fund manage your money per year typically ranges from 0.5% to 2% of your total assets under management.
Conclusion
Fund managers offer simplified services, especially for large operations and industries. They allow companies and individuals to set achievable goals and long-term plans that are beneficial to the business.
However, before investing in one, assess the available opportunities each fund manager can offer and pick the best out of it.
Also, create a strategy and a target list of what you want to achieve from it before going ahead with the opportunity. Put into consideration such questions like:
- The economic value of the funds
- The remaining lifespan
- Condition the assets are in
