Amana client funds shrink to Ksh.75.6 million
Amana Capital assets under management represented by the Amana Unit Trust Funds have shrunk to Ksh.75.6 million as of the end of March this year.
This to represent a 44.2 per cent dip in the fund’s value from a higher Ksh.135.4 million at the end of December last year.
In a wider comparison, Amana Unit Trust Funds held a greater Ksh.590 million at the end of 2019.
The more than 87 per cent decline in clientele funds is largely attributable to investor flight following a tumultuous year for the fund.
Amana Capital for instance lost Ksh.255 million in the collapse of giant retailer Nakumatt while another Ksh.185 million was stuck in Jamii Bora Bank, which is now a Cooperative bank subsidiary under the name Kingdom Bank after a 2020 buy out.
The losses had previously forced Amana Capital to freeze withdrawals from clients for the better part of 2020.
In December however, Amana Capital made available 68 per cent of client funds or an equivalent Ksh.122 million in deposits at the Kingdom Bank, the Co-operative Bank and I&M.
In the same month, the firm brought back former Chief Financial Officer Reginald Kadzutu as its interim Chief Executive Officer (CEO) to guide a new turnaround strategy for the fund manager.
The initial phase of three step-turnaround process running to the end of June this year has involved a rebuild of internal capacities to include the recruitment of new staff, re-purposing internal processes & procedures and digitization.
The continued bleed out of client funds will however serve to dent the turnaround process by reducing income from management fees which is traditional calculated as a percentage of assets under management (AUM).
Local collective investment schemes (CISs) now have Ksh.111.09 billion after crossing Ksh.100 billion in client funds in December last year.
Like Amana however, other collective scheme stare as client/investor flight in the event of uncertainty including loss of funds or the poor management of pooled resources.