Retirement fund body EPFO will not take into account the past performance of previously engaged ICICI Pru, HSBC AMC, SBI and Reliance Capital while finalising the new asset management companies (AMCs) for managing its Rs 3 lakh crore corpus.  Since the returns on investment provided by four fund managers was above the bench mark level of 8.52 per cent, past performance as EPFO’s fund manager would not be given any weightage while making fresh appointments,” a source privy to the development told PTI.

EPFO is in the process of appointing multiple fund managers for manging its funds for a three year period beginning July 1.

The meeting of the committee to recommend the appointment of the fund managers for EPFO to its trustees is likely to be held next week where the panel would shortlist eligible AMCs.

These four fund managers are among the 11 AMCs which are in the race to bag the contract for managing EPFO funds for another term of three years.

Besides, existing fund managers, seven new firms, including Kotak Securities , Securities Trading Corporation of India , UTI Securities and ICICI Securities , had shown interest in managing EPFO funds.

The body had engaged the four assets management firms from September 17, 2008 to March 31, 2011, with a view to improve the yield on its investments so that it could provide better returns on PF deposits to its over 4.72 crore subscribers.

ICICI Pru provided the best yield on investments made on behalf of the retirement fund body EPFO during the two-and -half year period ended March 31, 2011, while Reliance Capital gave lowest rate of returns.

The investments made by ICICI Pru yielded returns of 8.72 per cent followed by HSBC AMC (8.64 per cent) and SBI (8.61 per cent).

The lowest return of 8.57 per cent was provided by Reliance Capital, though it was slightly higher than the EPFO’s benchmark yield of 8.52 per cent.

Prior to the appointment of these four AMCs in September 2008, SBI was the sole fund manager for the EPFO since the retirement fund body’s inception in 1952.

Source –  PTI


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January 2021