Investment Guidelines
Retirement Benefits Authority has provided investment guidelines on which asset classes retirement benefits schemes can invest in and the maximum limits. The Authority has set the asset classes and limits to:
- ensure safety of retirement savings.
- ensure return on investment through income generating investments.
- diversify investments to reduce risks.
- ensure retirement benefits schemes can pay benefits.
In addition, each scheme has its own Investment Policy Statement (IPS) that outlines the investment principles and guidelines it has adopted on the asset allocation targets.
| Investment Regulations & Policies | ||
| Item | Categories of Assets | Maximum percentage of aggregate market value of total assets of scheme or pooled fund |
| 1 | Cash and Demand Deposits in institutions licensed under the Banking Act of the Republic of Kenya. | 5% |
| 2 | Fixed Deposits, Time Deposits and Certificate of Deposits in institutions licensed under the Banking Act of the Republic of Kenya. | 30% |
| 3 | Listed Corporate Bonds, Mortgage Bonds and Fixed Income Instruments; loan stocks approved by the Capital Markets Authority; collective investment schemes incorporated in Kenya and approved by the Capital Markets Authority reflecting this category; and global depository receipts. | 20% |
| 4 | Commercial Paper, Nonlisted bonds and other debt instruments issued by private companies provided that the bond or the instrument has been given investment-grade rating by a credit rating agency registered by the Capital Markets Authority, and collective investment schemes incorporated in Kenya and approved by the Capital Markets Authority reflecting this category. | 10% |
| 5 | East African Community Government Securities and infrastructure bonds issued by public institutions and collective investment schemes incorporated in East African Community (EAC) and approved by an EAC Capital Markets regulator reflecting this category. | 90% , or 100% in the case of scheme receiving statutory contributions |
| 6 | Preference shares and ordinary shares of companies listed in a securities exchange in the East African Community and collective investment schemes incorporated in Kenya and approved by the Capital Markets Authority reflecting this category; Exchange Traded Funds; and global depositary receipts. | 70% |
| 7 | Unlisted shares and equity instruments of companies incorporated in Kenya and collective investment schemes incorporated in Kenya and approved by the Capital Markets Authority reflecting this category. | 5% |
| 8 | Offshore investments in bank deposits, government securities, listed equities and rated Corporate Bonds and offshore collective investment schemes reflecting these assets. | 15% |
| 9 | Immovable property in Kenya. | 30% |
| 10 | Guaranteed Funds. | 100% |
| 11 | All exchange traded derivatives contracts approved by the Capital Markets Authority. | 5% |
| 12 | All listed Real Estate Investment Trusts incorporated in Kenya and approved by the Capital Markets Authority. | 30% |
| 13 | Private Equity & Venture Capital. | 10% |
| 14 | Debt instruments for the financing of infrastructure or affordable housing projects approved under the Public Private Partnerships Act, 2013 or as may be prescribed by the Cabinet Secretary responsible for matters relating to housing. | 10% |
| 15 | Any other assets. | 10% |
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