Gertrude’s Garden Children Hospital Staff Retirement Benefits Scheme has accused fund manager Stanlib Kenya of negligently investing more than Sh53 million of its assets in the bonds of two collapsed banks.
The retirement scheme said in a court hearing that it is staring at a loss from the 2015 purchase of corporate bonds issued by Chase Bank and Imperial Bank.
It added that it was also apprehensive of plans by Stanlib to divest and exit the Kenyan market. The asset manager is set to be acquired by rival ICEA Lion Asset Management.
In the case to be heard on February 20, the scheme wants the court to compel Stanlib to deposit Sh53.4 million in court, pending arbitration.
Alternatively, the amount should be deposited with NCBA Bank in an interest-earning account, the scheme trustees suggested.
In reply, Stanlib said the subject matter was not under threat or at risk and the move amounts to condemning it unheard.
“The application is an abuse of the court process in that there is no urgency in bringing the application and none has been demonstrated. No arbitration has been notified or commenced,” said Ms Evelyne Kinara, the risk and compliance manager at Stanlib.
Part of the clause in the agreement signed in July 2004 was that in case there is a dispute between them, it should be settled through arbitration.
The trustees of the scheme appointed Stanlib as the fund manager through an investment management agreement, which was signed on July 23, 2004.
And in breach of the Retirement Benefits Act, the agreement and investment policy statement, the trustees of the scheme said Stanlib invested Sh33.4 million and Sh20 million in Imperial and Chase bonds.