Equity Group Holdings secured a Capital Markets Authority (CMA) licence to run an independent asset-management division, placing Kenya’s most-populated bank in a stronger position in the market to vie for investor funds that are currently shifting away from conventional savings accounts.
Group CEO James Mwangi said the lender is responding to a market shift, noting that savers now want high-earning assets rather than conventional savings products. The venture will leverage Equity’s brand strength, distribution infrastructure, and IT backbone to build a formidable business capable of distributing globally manufactured assets.
The move marks a structural change, as Equity’s collective investment schemes (CIS) have until now been run under its Equity Investment Bank subsidiary. A dedicated asset management arm will let the group market money market, balanced, equity, and other funds more aggressively, joining rivals Absa, Standard Chartered Kenya, Ecobank Kenya, KCB, and I&M Group.
The numbers explain the urgency, with commercial banks’ average return on ordinary savings accounts standing at 3.32 percent in June, against 6.84 percent for fixed deposits. Money market funds are yielding an average of 8.4 percent, well above what Equity’s own unit trust currently offers at 5.22 percent.
For Equity, the license is as much defensive as offensive, allowing the bank to capture that migration internally while diversifying revenue beyond lending, insurance, and fintech. The entry of a bank with Equity’s reach could mean easier access to higher-yielding, professionally managed products for ordinary savers, though such funds carry market risk that plain savings accounts do not.
The license will enable Equity to diversify its revenue streams.
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