Financial Daily from THE HINDU group of publications
Friday, Aug 16, 2002
Financial Daily from THE HINDU group of publications Friday, Aug 16, 2002 |
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Money & Banking
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RBI & Other Central Banks Markets - Asset Management Companies PNB allowed to continue operations of MF arm Sarbajeet K. Sen
NEW DELHI, Aug. 15 THE Reserve Bank of India (RBI) has allowed Punjab National Bank (PNB) to continue the operations of its mutual fund subsidiary, PNB Asset Management Co Ltd (PNB AMC). The RBI had earlier asked PNB to close down PNB AMC along with another subsidiary - PNB Capital Services Ltd (PNB Caps) - in view of the continued losses shown by both. However, while agreeing with the RBI diktat to close down operations of PNB Caps, PNB had requested the central bank to permit it to continue with the AMC in view of the resurgence in its fortunes. "We have got approval of the RBI to continue with our mutual fund subsidiary a couple of days back,'' the PNB Chairman and Managing Director, Mr S.S. Kohli, said. He said that PNB's desire to retain the mutual fund subsidiary was on account of the improved performance shown by it during fiscal 2001-02. For the nine-month ended December 2001, PNB AMC had registered net profit of Rs 1.27 crore against continued losses in the preceding five years, including a loss of Rs 73 lakh during 1999-2000. Mr Kohli, however, said that the operations of PNB Caps would be merged with the parent bank thereby extinguishing the existence of the capital market outfit. He said that plans were being worked out for improvement of the functioning of the AMC. He, however, did not comment on the possibility of the induction of a partner for it. "We plan to drastically improve the functioning of the AMC. We would also launch some new funds in the coming months,'' Mr Kohli said. PNB MF, run by PNB AMC, currently has five schemes under management, including three closed-ended scheme and two open-ended ones. The net asset value of the three Equity Growth Funds on - EGF-93, EGF-95 and EGF-96 - are all ruling below par at Rs 6.98, Rs 7.77 and Rs 9.91 respectively on August 12. However, the two close-ended funds - PNB Debt Fund and PNB Balanced Growth Fund (BGF) are doing better. The repurchase price of PNB Debt (Growth) is currently Rs 16.39, while that of PNB Debt (Income) Fund is Rs 12.31. For the BGF, the repurchase for the growth scheme is Rs 11.09, while that for the income scheme is Rs 8.72. PNB has two other subsidiaries, PNB Housing Finance Ltd and PNB Gilts, both of which are doing well and have been showing sustained profits.
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