Octagon Umbrella fund grows to Ksh.3.2 billion after 19.1% investment return

The Octagon Umbrella Retirement Benefits Scheme has grown its fund value to Ksh.3.2 billion, buoyed by strong investment returns and a rise in membership.

The scheme’s aggressive investment portfolio recorded a 19.1 per cent return in 2025, outperforming the umbrella fund market average of 12.37 per cent.

Its balanced fund posted a 14.8 per cent return, while the conservative fund returned 11.6 per cent, with all three investment options recording positive performance during the year.

The scheme’s fund value rose from Ksh.2.9 billion in 2025 to Ksh.3.2 billion by March 2026, while membership increased by 22 per cent, with more than 200 employers participating in the scheme.

Octagon Africa Head of Retail Michael Komen attributed the growth to increased demand for professionally managed retirement arrangements that give members greater investment choice and access to information.

“The growth of the Octagon Umbrella reflects the increasing importance of professionally managed retirement arrangements that give employers efficiency while providing members with investment choice and access to their retirement information,” said Komen.

He said members were increasingly looking for retirement solutions that combine investment discipline with transparency and effective risk management.

“Members now need solutions that combine disciplined investment, appropriate risk management, transparency and easy access to information. Our focus is to ensure that the growth of the Scheme translates into long-term value and greater financial security for members,” said Komen.

The scheme offers three investment options tailored to different risk appetites and investment horizons.

The conservative fund focuses on stability through investments in guaranteed funds, fixed-income securities and Treasury bills. The balanced fund spreads investments across equities, bonds, cash equivalents and guaranteed funds, while the aggressive fund has greater exposure to equities, real estate investment trusts and private equity.

The performance comes amid a strong run for Kenyan equities, which generated a 104 per cent return over the two years to June 2026, according to the statement.

The scheme has also expanded digital access to pension services through its Octagon Pension Administration System (OPAS), allowing members to access statements and update beneficiary details online, while employers can submit contributions and approve member requests digitally.

The growth of umbrella schemes comes as Kenya’s retirement benefits sector continues to expand.

According to the Retirement Benefits Authority’s June 2026 Industry Brief, pension assets under management rose by 12.66 per cent in the six months to June 2026, from Ksh.2.811 trillion in December 2025 to Ksh.3.167 trillion.

Over the 12 months from June 2025, total pension assets increased by 25.13 per cent, equivalent to Ksh.636 billion.

The RBA has attributed part of the growth to smaller standalone corporate schemes shifting to umbrella arrangements, which can reduce administrative demands and costs while allowing employers and members to benefit from pooled services and investment management.