Old Mutual Unit Trust ventures into offshore investment

Old Mutual Unit Trust has approved a proposal by its shareholders to start offshore investments, which is the keeping of money in a jurisdiction other than one’s country.

Speaking at the trust’s annual general meeting in Blantyre on Monday, the firm’s managing director James Mhura said the proposal followed requests from unit holders to benefit from its global reach by tapping from much larger markets outside Malawi.

He said following the no-objection from Reserve Bank of Malawi (RBM), which has allowed the firm an allocation of 10 percent, it will now roll out the offshore investments.  

“After eight years of operation, we looked at our balanced fund and we thought that it had reached a stage where we can start looking for markets outside Malawi.

“We proposed to the trustees of the fund that we take a portion off the fund to invest in other developed markets through our Old Mutual Investment Group in South Africa,” said Mhura.

He said going forward, they will invest 10 percent of their balanced fund in developed markets outside Malawi, mainly in South Africa.

“There are various angles that unit holders can benefit from this arrangement. We know that our investment market is narrow. If we look at the stock market, we only have 14 companies listed,” said Mhura.

He said by investing abroad, unit holders will have the opportunity to participate in developed countries markets where they have many companies listed on the stock exchange.

Mhura said 2018 was good in terms of return on investment and the growth in funds under their management. The unit chairperson Edith Jiya, who is also chief executive officer of Old Mutual Malawi, said there is need for policies to ensure that the country is not dependent on how good or bad the agriculture sector has performed