KEPFIC & FMA sign MOU to foster Pension Investment in Alternative Assets

The Kenya Pension Funds Investment Consortium (KEPFIC) and the Fund Managers Association (FMA) have agreed to share expertise in pursuing diversified investment opportunities for local pension schemes. The Memorandum of Understanding (MOU), signed during the KEPFIC 2023 Investment Conference on Friday, formalizes collaborative efforts between KEPFIC and FMA. The purpose of the MoU is to promote pension investments in infrastructure and alternative assets to achieve diversification and higher returns for a sustainable future for pension beneficiaries.

KEPFIC is a pension industry initiative supported by USAID and the World Bank Group, formed to support Kenyan retirement funds to make long-term infrastructure and alternative asset investments to diversify their portfolios and seek higher returns. KEPFIC works with pension schemes to overcome challenges such as limited visibility on alternative investment opportunities, large capital requirements, and a lack of specialized investment expertise.

KEPFIC and FMA will work together to develop an alternative asset investment pipeline for schemes. KEPFIC will lead in scouting and screening viable prospects, collaborate with the FMA to conduct independent assessments of shortlisted opportunities and showcase these investment prospects to pension funds.

Mr Ngatia Kirungie, Head of the KEPFIC Secretariat and CEO of Spearhead Africa said during the MOU signing:

“The need for portfolio diversification has never been stronger, and we are pleased to formalize the relationship between KEPFIC and the FMA as we both work towards the common goal of ensuring optimal returns for our local pension schemes.

We are keen to work with the FMA member fund managers, leverage their investment management expertise on commercially viable opportunities, and work closely in promoting the uptake of alternative assets investments in pension portfolios.’’.

Mr Patrick Kariuki, Chairman of FMA, remarked:

“Fund managers have a responsibility to be good stewards of retirement funds for millions of individuals. Working with KEPFIC will allow us to explore investment opportunities that have the potential to enhance investment portfolios for our pension schemes. We look forward to harnessing our collective expertise; contribute further towards diversification and responsible stewardship of pension funds”.

Last week, pension schemes were presented with deals worth 700bn in alternative investment assets spanning different sectors: energy, affordable housing, healthcare, water and sanitation, transport and logistics, agriculture, telecoms, and ICT.