UTI AMC turns private; is largest Mutual Fund

New Delhi, Nov 18 | Updated: Nov 19 2005, 06:02am hrs
UTI AMC has become a private company with four sponsors - State Bank of India, Life Insurance Corporation, Punjab National Bank and Bank of Baroda - paying Rs 1,236.95 crore to the government.

Addressing mediapersons, finance minister P Chidambaram said, UTI AMC will run as a private mutual fund competing with the rest of the industry under the regulations and supervision of the Securities and Exchange Board of India.

The assets under management of UTI AMC would be Rs 25,000 crore, making it the largest in the country with 67 lakh investors. Each of the sponsors, which paid Rs 309 crore, will own 25% stake in the mutual fund. Chairmen of all four sponsors AK Shukla of LIC, AK Purwar of SBI, SC Gupta of PNB and AK Khandelwal of BoB were present on the occasion.

The four sponsors will own 25% stake each in the mutual fund that manages Rs 25,000 crore in assets.

UTI was set up to function as a vehicle for mobilising domestic savings needed for the growth of the Indian economy and channelising the benefits of economic growth to households, Mr Chidambaram said. He also pointed out that the government has transferred assured return schemes under SUUTI and issued bonds totalling Rs 14,500 crore.