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S. Vaidya Nathan

THE new asset management company for UTI-II will be formed by Punjab National Bank, State Bank of India, Bank of Baroda and Life Insurance Corporation. UTI-II will comprise the assets of the UTI's NAV-based schemes. The move to float the AMC follows the promulgation of the ordinance seeking to repeal the UTI Act of 1963.

The banks and LIC will also form a trustee company to create a SEBI compliant structure for UTI-II. The banks and LIC will contribute equally to the capital requirements of the AMC and the trustee company.

UTI Bond Fund dividend: The Unit Trust of India (UTI) has announced a dividend of 3 per cent for the UTI Bond Fund. Investors in the income option as of November 15 will be eligible for the dividend. There is no book closure for this purpose. The fund had earlier announced a 4 per cent dividend in August.

IDBI Principal Plan: IDBI Principal Mutual Fund has introduced a recurring investment scheme (RIS) under its systematic investment plan. An RIS account is to be started with a minimum deposit of Rs 500 with two post-dated cheques of Rs 500 each. Thereafter, an investor can invest additional amounts. The fund has tied up with Bluechip Corporate Investment Centre and Geojit Securities to market this plan in India, and with Barjeel Securities to do likewise in the UAE.

HSBC's foray: HSBC Mutual Fund has entered the market with IPOs of four products — HSBC Income Fund , HSBC Equity Fund, HSBC Cash Fund and HSBC Institutional Income Fund. The initial offer is open till December 3.

Zurich AMC changes: Zurich India Asset Management Company has sought permission from the Foreign Investment and Promotion Board for the following changes in its ownership structure:

Conversion of 223.2 lakh equity shares of Rs 10 each held by Zurich Finance (Mauritius) Ltd (ZFML) to non convertible redeemable, cumulative, non-participating preference shares of Rs 10 each.

Transfer of 5.81 lakh equity shares of Zurich AMC held by the Indian shareholders to ZMFL for a consideration of Rs 20.7 crore subject to compliance with RBI norms

The preference shares will have a coupon rate of 10 per cent and tenure of 20 years.

The move follows the decision of Indian shareholders to sell their stake in the company and the restructuring of the capital structure is designed to facilitate their exit according to the fund.

ZMFL will surrender existing equity and take fresh equity leaving the overall foreign equity holding unchanged at 75 per cent. Raymond Apparel will hold 24.03 per cent, JK Invest Trade 0.96 per cent and S. V. Prasad 0.01 per cent.

US 2002: US 2002, the scheme craved out from the UTI's US-64, will start off with an initial corpus of Rs 50 crore. The scheme offers income and growth options. The minimum and maximum debt limits are 45 per cent and 75 per cent respectively while, for equity, the limits are 25 per cent and 55 per cent respectively.

UTI satellite offices: UTI plans to strengthen its distribution network in potential towns and districts with satellite offices that will complement the work of Chief Representatives and agents. It plans to start with such offices in 17 districts, beginning with Kota, in Rajasthan.

HDFC's anytime fund: HDCF Mutual Fund has launched Any Time Mutual Fund — a service through which investors will be able to buy and sell units through ATMs even on weekends and bank holidays. The fund has tied up with HDFC Bank and ICICI Bank for this service, which has been introduced in Mumbai and will be rolled out throughout India over time.

The fund will launch an ATMF card along with HDFC Bank, which will allow investors withdraw money instantly at an HDFC Bank ATM across India. The facility will be available for HDFC Liquid Fund, HDFC Short Term Fund and HDFC Income Fund through HDFC Bank.

Funds withdrawn would be redeemed from these schemes in the same order. The maximum daily withdrawal permissible is Rs 5,000 and a minimum balance of Rs 15,000 has to be maintained.

US-64 prices: The repurchase price for unit holdings of up to 5,000 units (enhanced from 3,000 units) is Rs 11.40 per unit in November 2002 under the Special Liquidity Package. The package was offered from August 2001 at Rs 10 per unit and is due to end in May 2003 at Rs 12 per unit.

The price for October was Rs 11.30 per unit. For holdings in excess of 50,00 units, a repurchase facility linked to the NAV is available from January 2, 2001.

For such holdings, an assured repurchase price of Rs 10 per unit or NAV, whichever is higher, is available on May 31, 2003, if the units are held till then. The redemption will be at NAV-based prices if it carried out before May 31, 2003.

For less than 5,000 units, the assured repurchase price for May 2003 is Rs 12 per unit. These special repurchase prices will also be available beyond May 2003.

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