News That Matters

Tag: Mutual

Wary mutual funds still refuse to buy all but the safest debt

Wary mutual funds still refuse to buy all but the safest debt

Finance
By Subhadip SircarMoney managers in India have become so concerned about credit risk that even guarantees from policymakers for lower-rated debt is failing to entice them. Sentiment soured after Franklin Templeton, a big buyer of high-yield Indian notes, shut six debt funds in April. And this week, the market regulator allowed some bond funds to hold more government paper and treasury bills, underlining the flight to safety triggered by Franklin’s shock decision. “We continue focusing on quality within fixed income,” said Suyash Choudhary, head of fixed income at IDFC Asset Management in Mumbai. “A big part of this is due to drivers like lack of adequate liquidity and price discovery” in lower-rated papers, he said. Finance Minister Nirmala Sitharaman earlier this month announced a 300 bil
Sebi gives exit route to mutual fund investors in wound up schemes

Sebi gives exit route to mutual fund investors in wound up schemes

Finance
The Securities and Exchange Board of India has said that the units of schemes in the process of winding up will have to be listed on recognised stock exchanges. This rule will have to be followed by all open and close-ended schemes. This move by the market watchdog comes after Franklin Templeton Mutual Fund decided to wind up 6 of its debt mutual fund schemes. In a circular issued on Wednesday, Sebi said: "In terms of Regulation 31B(1) of the MF Regulations, the units of Mutual Fund schemes can be listed in the recognized stock exchange. Accordingly, the units of Mutual Fund schemes which are in the process of winding-up in terms of Regulation 39(2)(a) of MF Regulations, shall be listed on recognized stock exchange, subject to compliance with listing formalities as stipulated by the stoc...
RBI announces Rs 50,000 crore liquidity support to Mutual Funds

RBI announces Rs 50,000 crore liquidity support to Mutual Funds

Finance
The Reserve Bank of India on Monday announced Rs 50,000-crore liquidity support for mutual funds. Under the special liquidity facility scheme effective today, the RBI will conduct repo operations of 90 days tenor at the fixed repo rate. The facility will be on-tap and open-ended, and banks can submit their bids to avail funding on any day from Monday to Friday, RBI said. Funds availed under the scheme can be used by banks exclusively for meeting the liquidity requirements of MFs by extending loans, and undertaking outright purchase of and/or repos against the collateral of investment grade corporate bonds, commercial papers (CPs), debentures and certificates of Deposit (CDs) held by MFs. The central bank’s move has come following Franklin Templeton’s decision to close six debt funds and pu
Rs 4,500 crore mutual fund money at stake in Voda Idea; Templeton markdown hits 6 schemes

Rs 4,500 crore mutual fund money at stake in Voda Idea; Templeton markdown hits 6 schemes

Finance
Mutual funds having exposure to Vodafone Idea’s corporate papers and shares are staring at possible losses as an adverse judgment from the Supreme Court threatens to down the curtains on the business. The telco’s survival will now depend on its ability to garner funds to pay the statutory dues and repay what it had borrowed from the market. The government has estimated Vodafone Idea’s dues at over Rs 53,000 crore, including over Rs 28,000 crore in licence fee, interest and penalties and the rest on spectrum usage charges. Besides, the company’s total debt stood at Rs 1.15 lakh crore at the end of FY2019, shows available data. Mutual fund investors have already taken the first hit from this, after Franklin Templeton India marked down its Vodafone Idea debt exposure to zero as a pre-emptive
Mutual funds add Rs 3.15 lakh crore to asset base in 2019

Mutual funds add Rs 3.15 lakh crore to asset base in 2019

Finance
Mutual funds have added a whopping Rs 3.15 lakh crore to their asset base in 2019 on the back of robust inflows in debt schemes and measures taken by regulator Sebi for boosting investor confidence. The asset under management (AUM) of the industry rose by over 13 per cent (Rs 3.15 lakh crore) to Rs 26.77 lakh crore at the end of last month, up from Rs 23.62 lakh crore at the end of December 2018, as per the latest data available with the Association of Mutual Funds in India (Amfi). The AUM growth seen by the 44-member mutual fund industry in 2019 is significantly higher than 7.5% witnessed in 2018. However, the growth was much more higher at 32% in 2017, when the asset base expanded by over Rs 5.4 lakh crore. Industry experts said the double-digit growth is a positive sign given the negati...