CMA finally grants Cytonn licence for fund management

Cytonn Investment analyst Caleb Mugendi speaks during the release of the firm’s 2O18 market outlook in Nairobi in February. PHOTO | salaton njau 

By JAMES NGUNJIRI

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Summary

• The move brings the number of licensed fund managers in the country to 27 with nominal total assets under management of Sh1.13 trillion as at December 31, 2017.
• According to Cytonn, the fund management unit is expected to attract resources from high-net worth investors and pension schemes to real estate and private equity, which offer higher returns than bonds, equities and fixed income.

The Capital Markets Authority (CMA) has finally granted a fund manager’s licence to Cytonn Asset Managers Ltd after a one-and-a-half year wait.

This brings the number of licensed fund managers in the country to 27 with nominal total assets under management of Sh1.13 trillion as at December 31, 2017.

The real estate-focused private equity firm had disclosed its application way back in September 2016.

CMA, in a statement, said the licensing of Cytonn Asset Managers Ltd is the first step in the move by the holding company towards bringing certain activities of Cytonn Investments Management Plc within the authority’s regulatory ambit.

Cytonn has been managing wealth outside the CMA regulation.

“This follows Cytonn Investments Management Plc’s commitment to provide requisite disclosures and take steps to reorganise its business lines. The authority will continue to work with the group to facilitate effective supervision of relevant activities of the company,” the regulator said.

READ: Cytonn converts into a public company

Cytonn Asset Managers Ltd was incorporated in August 2016 and is a subsidiary of Cytonn Investments Management Plc.

A fund manager is an administrator of a collective investment scheme — such as a unit trust, registered venture capital company or an investment adviser who manages a portfolio of securities in excess of an amount prescribed by the authority from time to time.

According to Cytonn, the fund management unit is expected to attract resources from high-net worth investors and pension schemes to real estate and private equity, which offer higher returns than bonds, equities and fixed income.