Pension industry has registered an annual increase of 24.6pc in assets under management which grew to Ksh 2.8 trillion by close of December last year from Ksh 2.3 trillion recorded during the previous year.
According to the latest brief by the Retirement Benefits Authority (RBA), the additional Ksh 554 billion to total pension assets was powered by the rise in contributions as a result of the implementation of the National Social Security Fund (NSSF) Act, which helped boost contributions by Ksh 156.1 billion over the period.
“The transition into the third year of the NSSF Act (2013) implementation provided an increase in contributions. With the lower and upper contribution limits rising to Ksh 8,000 and Ksh 72,000, respectively,” said RBA.
In the half year period between June and December 2025, AUM rose by 11.1pc powered by strong returns on investment income and valuation gains which increased by Ksh 122.9 billion.
“Pension portfolios benefited from a stabilized macroeconomic environment. A steady exchange rate and a favourable interest rate environment supported investment growth, while mild inflationary pressures protected the real value of member benefits,” the authority stated.
RBA says industry’s core portfolio remains heavily concentrated in four primary asset classes, which account for 90.43% of total AUM. They include government securities, quoted equities, immovable property, guaranteed funds, and fixed deposits, while the rest the invesment assets are categorized as alternative assets.
In half year to December 2025, total AUM by fund managers increased by 12.7pc, to hit Ksh 2.2 trillion from Ksh. 1.97 trillion reported in June.
Government securities remain the top asset class for pension fund managers, accounting for 52.1pc of total investment portfolio, equivalent to Ksh 1.47 trillion. During the full year period, investment in government securities rose by 10pc.
Listed corporate bonds posted the fastest growth rate of 638.6pc after rising from Ksh 3.8 billion in June 2025 to close at Ksh 283 billion although accounted for 1pc
“The growth in this asset class was underpinned by the listing of several new corporate and infrastructure-backed notes between July and December 2025.”
The listings include issuance of LINZI 003 Infrastructure Asset Backed Security (IABS) for the development of Talanta Sports Stadium where schemes invested a total of Ksh 18.12 billion, East African Breweries Ltd (EABL)
Medium Term Note and Safaricom Ltd Medium-Term Notes.
