Kenya’s retirement schemes recorded a median return of 5.4% over the quarter ended 30th June 2021, compared to 2.5% in March 2021- attributed to solid performance in the equities and offshore investment markets.
This is according to Zamara Consulting Actuaries Schemes(Z-CASS) Survey June 2021, which covered 424 retirement schemes with a total of KSh 976.8 Billion of Assets Under Management.
Over the one year to 30 June 2021, the median return of the participating retirement benefit schemes was 15.9% compared to 7.6% over a similar period in 2020.
This performance is due to resilience in the equities market and offshore investments.
Moderate retirement benefit schemes dominate this Survey; they comprise 70.8% of participating schemes and manage 75.0% of assets in this Survey.
Conservative schemes make up 19.8% of the participating schemes, with 12.2% of assets under management. Aggressive schemes make up 9.4% of the participating schemes, with 12.8% of assets under management.
Aggressive schemes had the most robust performance median return over the three months and one year; on the background of better performance from the equities and offshore asset classes over these periods.
Aggressive schemes have a higher allocation towards equities and offshore markets.
Conservative schemes posted the highest median returns over the three-year and five-year periods, aided by a higher allocation towards Fixed Income that performed strongly over these periods.
21.2% of the Schemes participating in the Survey had an allocation to property. 33.5% of the Schemes participating in the Survey had an allocation to offshore assets.
This Survey shows that the average scheme’s exposure to equity and offshore increased with allocations to fixed income and property decreasing over the quarter.
Some schemes did not qualify to be included in the Survey. This was due to incomplete data; data received did not pass sense checks, or responses to queries were not received as of the date of issuing this report.
424 Schemes qualified for inclusion in the Survey on the basis of being segregated arrangements with at least three months return periods.
The Z – CASS Survey is an industry-first initiative of Zamara Actuaries, Administrators and Consultants Limited and analyses the returns of retirement schemes invested in segregated vehicles with both discretionary and non-discretionary mandates.
ALSO READ: Pension Scheme Members to Buy Residential Houses Using a Portion of Their Benefits
