Pension Schemes Earn Highest From Equities – Survey

By James Waithaka

Retirement funds earned the highest returns from equity investments over the three months to September compared to other asset categories, according to a survey by an actuarial services firm.

Actuarial Services (EA) Ltds third quarter report shows pension schemes on average earned returns of 10.1 per cent from investments in stocks listed on the Nairobi Securities Exchange.

Fixed income investments, such as bonds and Treasury bills, were the second best asset class in the period with returns of 5.8 per cent. The survey shows pension schemes made average losses of 0.01 per cent from offshore investments.

While some of the 68 schemes polled have invested in property, Actserv excludes the asset class from the survey owing to its illiquidity. The pensions schemes had a cumulative fund value of Sh85 billion.

Actserv said overall average returns for pension schemes rose to 5.8 per cent between July and September, outpacing the previous quarters 2.6 per cent average yield.