Absa Bank Kenya PLC has officially launched its custody services business in Kenya as part of its corporate business offering. The Absa custody business will offer safekeeping and servicing of assets, settlement of instructions for both local and cross-border investments, compliance and statutory reporting, track and execute corporate actions, portfolio reconciliations and provide customers with timely reports.
The niche segments for this service will include fund managers (collective investment schemes and gratuity funds), pension fund trustees (occupational pension funds). It will also cover life insurance companies (commercial pension funds, including umbrella, individual pension funds, income drawdown funds, and post-retirement medical schemes), as well as Saccos, Shariah backed investments and other institutional investors.
The custody business was officially unveiled during a stakeholder engagement forum held in Nairobi. Themed “Aligning to the Future of Investments,” the event gathered industry stakeholders from both pensions and capital markets including pension administrators, fund trustees, fund managers, insurance companies, saccos, industry associations and regulatory bodies. The forum provided a platform for dialogue on advancing investor needs, trends, cutting-edge innovations and technologies, opportunities within alternative investments, and the custody of virtual assets.
“Custody services have taken a back seat in the financial sector for a long time, rather than serving as a strategic lever and a bridge that connects investors with a trusted partner,” Absa Bank Kenya Corporate and Investment Banking Managing Executive, Mr James Agin said. “Today, custody services are taking the lead in strategic solutions offered by financial institutions, and Absa Bank has not been left behind because we are keen on investing in our customers’ stories and providing the necessary solutions that support their growth story.”
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Absa Bank’s Euroclear infrastructure licence will enable its clients seeking higher returns to tap into the massive alternative investments space such as Eurobonds, offshore securities and commodity trading including the Absa sponsored Golf ETF that is currently the only listed commodity at the Nairobi Securities Exchange. The bank is aligning with the Kenya’s draft Virtual Assets Policy and the proposed Virtual Assets Service Providers (VASP) Bill in preparation to support custody for virtual assets.
“We have made significant investments in technology to provide a tech-driven solution and are keen to continue leveraging the latest technology to align with the future business demands for seamless execution and efficiency,” Mr Agin added.
Mr. Agin confirmed that Absa Bank is partnering with global custodians such as BNY Mellon, State Street and Societe Generale to expand its clients’ access to international markets. The Bank is also collaborating with regulators and stakeholders like the Capital Markets Authority, Retirement Benefits Authority, Nairobi Securities Exchange and the Central Depository & Settlement Corporation to align with best practices to cater for the emerging market demands.
With custody services now live in Kenya, South Africa and Mauritius, there are plans to roll out similar services in Uganda and Ghana this year.
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