Government bank is going to step into Mutual Fund business, expected to start service in this financial year
Swaroop Kumar Saha, MD, Punjab Sind Bank said that the bank is working on a plan to enter the AMC business. Bank's profits are expected to increase due to the foray into the AMC business. The AMC business in the country has witnessed a boom in the recent past and has grown five times in the last 10 years.
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Public sector Punjab and Sind Bank are preparing to enter the mutual fund category so that the bank can increase the fee-based income. However, the bank is looking for a partner for this. Information was given by a senior officer.
On behalf of Punjab and Sind Bank MD Swaroop Kumar Saha, PTI was told that a proposal has been brought by the bank that the fintech partner will be finalized soon. We hope that this process will be completed as soon as possible.
He expressed hope that the bank would be able to finalize a partner by the end of the second quarter and start operations during the current financial year.
The foray into the asset management business will help the bank to generate income through cross-selling of products. At present, there are 44 asset management companies in the country, which manage assets worth Rs 44,39,187 crore.
This industry is growing rapidly. The AUM of the mutual fund industry was Rs 8.11 lakh crore in June 2013, which has grown five times in the last 10 years to Rs 44.39 lakh crore.
In the June quarter results of Punjab and Sind Bank, there has been a 25 percent decline in profit on an annual basis. The bank's profit fell to Rs 152.6 crore from Rs 204.7 crore on an annual basis. However, there has been an improvement in asset quality and NPA has come down to 1.5 percent. At the same time, the gross NPA has come down to 6 percent.
