The Capital Markets Authority has given the nod to seven new collective schemes, including Kenya's first alternative investment fund with a primary focus on the SACCO industry, signaling an expansion of regulated savings offerings seeking to channel both institutional and retail capital into the formal market.

In a statement on Tuesday, the CMA announced record batch of approvals cutting across unit trusts, special funds and an alternative investment vehicle.

CMA's approvals come amid increased push by East Africa's largest economy to further deepen the capital markets and draw in retail savings currently held in fragmented informal arrangements and or bank deposits.

One of the most significant approvals was the KETSA Alternative Investment Fund, which is registered by Faida Investment Bank. 

Established as a trust under the Capital Markets (Alternative Investment Funds) Regulations 2023, KETSA Alternative Investment Fund is tailored to channel investments in private debt, equities, money market instruments and fixed income securities, with a specific mandate to intermediate institutional capital into the SACCO ecosystem. 

Currently, Kenya's network of savings and credit cooperative organisations hold billions of shillings in member deposits, but have historically faced limited access to structured liquidity and investment opportunities.

CMA also approved Capital A Investment Bank to register two new sub-funds under its existing unit trust umbrella: the Capital A Multi Asset Strategy Special Fund in Kenyan shillings and a US dollar-denominated version. 

According to the regulator, both will pursue an actively managed, event-driven multi-asset strategy, targeting investors seeking diversified exposure across asset classes.

At the same time, EDC Asset Management (Kenya) received approval to launch an entirely new umbrella scheme, the EDC Kenya Unit Trust Funds, comprising five sub-funds: a money market fund, a fixed income fund, a dollar income fund, a balanced fund and an equity fund. 

This structure is designed to offer a spectrum of risk-return profiles, from capital preservation to long-term growth, allowing investors to switch between sub-funds as their risk appetite changes.

Additionally, Pergamon Investment Bank was authorised to register the Pergamon Unit Trust Scheme, which will include six sub-funds: two money market funds (Kenyan shilling and US dollar), an equity fund, a fixed income fund, a balanced fund and a special diversified income fund in shillings. 

The scheme adds to a crowded but rapidly growing unit trust industry that has seen assets under management swell in recent years as retail investors seek higher yields than traditional bank deposits.

Meridian Asset Management was approved to launch the Meridian Asset Management Scheme, an umbrella trust starting with a single sub-fund, the Meridian Kenya Shilling Total Return Special Fund. That vehicle will seek to maximise absolute returns while preserving capital through a combination of capital appreciation and income generation.

Finally, Nabo Capital was permitted to convert its existing Nabo Africa Balanced Fund (USD) into a special fund renamed the Nabo Ubuntu Special Fund. 

Nabo Capital's new vehicle will pursue long-term capital appreciation through dynamic multi-asset allocation across equities, fixed income, derivatives, commodities, currencies and fund-of-funds strategies. 

The conversion allows Nabo to take advantage of the broader investable universe permitted under the special fund framework, including opportunistic alpha-generation strategies not available to conventional unit trusts.

The approvals come as the CMA steps up efforts to expand investor choice and deepen liquidity in Kenya’s capital markets. In a statement, the authority said the new schemes aligned with its ongoing push to enhance innovation and expand access to investment services across diverse investor segments.

“Investors are reminded to familiarise themselves with any scheme before investing and to deal only with licensed and approved capital markets intermediaries,” the regulator said.

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