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UTI
informed ministry of US-64 crisis very late: JPC
Our
Economic Bureau
New Delhi, Sept 12: The Joint Parlia- mentary Comm-
ittee (JPC) descri- bed the decision of the Unit Trust of
India (UTI) to apprise the finance ministry of the imminent
US-64 crisis just prior to its board meeting as an “unusual
step.”
| UTI redemptions
4 times higher than sales |
Mumbai, Sept 12: Unit Trust of
India’s redemptions were nearly four times higher than
its sales at Rs 633 crore for August.
The total sales of UTI for all the schemes stood at Rs
167 crore in the reporting month, according to Association
of Mutual Funds in India (Amfi) here. The sales of all
the mutual funds aggregated Rs 10,393 crore while redemptions
were Rs 9,490 crore, it said.
Predominantly foreign mutual funds raised Rs 4,445 crore,
which included Rs 72 crore from three new schemes. Redemptions
stood at Rs 3,818 crore. |
Briefing reporters about the JPC meeting
on Tuesday, committee chairman SPM Tripathi said it was generally
felt that UTI informed about the crisis to the finance ministry
very late.
Mr Tripathi said two days prior to the July 2 board meeting,
the then UTI chairman PS Subramanyan had met joint secretary
J Bhagwati and informed about the decision to freeze the sale
of US-64 units. Mr Bhagwati, however, asked the UTI chairman
to give all the matter in writing to the finance secretary
Ajit Kumar.
When Mr Subramanyan met finance minister Yashwant Sinha a
few hours before the commencement of the UTI board meeting,
it was felt by the minister that any intervention by the finance
ministry at that time would have looked like superseding the
UTI board and the meeting was allowed to proceed in the manner
that had been scheduled.
The finance ministry was also quizzed by the JPC members on
whether there was regular monitoring of the stock market even
when the stock prices were at the peak. The JPC members were
told that warnings were issued on the behaviour of the stock
market at that time through the press and other means.
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