Board Appoints Damodaran As UTI AMC Head

Mumbai, January 28: | Updated: Jan 29 2003, 05:30am hrs
The board of directors of UTI Trustees Company (P) Ltd and UTI Asset Management Company (Pvt) Ltd on Tuesday appointed M Damodaran as the chairman & managing director of UTI AMC (P) Ltd.

We are in a state of complete readiness as UTI MF from February 1, 2003. From February 3, 2003 (being the first working day), UTI AMC will be fully operational, Mr Damodaran, chairman, UTI, told a press conference.

As on December 31, 2002, the corpus of UTI AMC was at Rs 15,179.64 crore with 47 schemes under its belt, while UTI-Is corpus was at Rs 30,591.19 crore with 22 schemes. UTIs flagship scheme US-64 has a share of Rs 9,555.54 crore in UTI.

UTI will be formally split on February 1, 2003, wherein UTI-I will give shelter to US-64 and all assured-return schemes, while UTI Mutual Fund will have all net asset value(NAV)-related schemes. With regard to managing the funds of UTI-I, Mr Damodaran said: If approached, we are willing to manage the assets of UTI-I.

If we are approached by UTI-I for managing their assets, the fee charged would be very competitive and in line with the industry standards, he added.

The advisory board of UTI-I will meet on January 29, 2003, and decide the future course of action with regard to managing its funds. The issue of fee for managing UTI-I will also be decided on Wednesday in the meeting of the advisory board, which will also assign a name to UTI-I. The advisory board consists of Mr UK Sinha, joint secretary, capital markets, the finance ministry; Mr D Swarup, additional secretary (budget) the finance ministry; banking expert MG Bhide and finance expert AN Shanbhag besides Mr Damodaran as the administrator.

Along with Mr M Damodaran, the other board members of UTI AMC are: SH Bhojani, partner, Amarchand Mangaldas; JS Mathur, former deputy comptroller and auditor general of India; BD Sumitra, deputy managing director and chief financial officer, State Bank of India (SBI).

The UTI Trustee comprises C Ramachandran, Pritam Singh, ID Agarwal, Dr (Mrs) Kanta Ahuja and MP Radhakrishnan. Mr Ramachandran was also appointed as chairman of UTI Trustee Co. (P) Ltd.

Addressing the media, Mr Damodaran said: We are soon expecting a notification from the government with regard to UTI (especially UTI-I) to be covered under the securitisation Act.

Currently, UTI is not covered under securitisation Act.

UTI AMCs staff strength would be around 2,400, out of which 300 are on deputation with UTI Investor Services Ltd and around 25 to 30 in UTI-I, Mr Damodaran said.

The four sponsors of UTI Mutual Fund are: Life Insurance Corporation (LIC), SBI, Punjab National Bank (PNB) and Bank of Baroda (BoB). All these four sponsors hold 25 per cent each in UTI AMC.

On Monday, in a major step the government had decided that US-64 units issued on or before June 30, 2001 either held by the original unitholders or by the buyers of these units in the secondary market would be treated as five-year, tax-free, tradeable bonds with effect from June 1, 2003.

The bonds will mature on May 31, 2008, and bondholders would be paid interest on their holding at such rate and frequency (that is, half-yearly, yearly), which would be announced later.