VR Logo

Union Bank to launch Mutual Fund

SEBI has given the bank and its partner an in-principle nod

The Union Bank of India just got the nod to jump on the mutual fund business bandwagon, courtesy market regulator, the Securities and Exchange Board of India (SEBI).

The industry, already has a strength of 37 asset management companies (AMCs) after Axis Bank got the approval from SEBI recently.

The Union Bank of India-led AMC would be a joint venture with Belgium-based KBC group. Union Bank of India will have a 51 per cent stake in the joint venture, while KBC will hold 49 per cent stake. The bank intends to invest Rs 48.07 crore in the JV by the end of this year while on the other hand, KBC will contribute Rs 46.93-crore.

The joint venture, Union KBC Asset Management Company, which is still designing the product-portfolio, is expected to bring out its first mutual fund product into the markets sometime in February next year.

The AMC’s hunt for a suitable chief executive officer (CEO) is underway.

Axis MF has already filed offer documents for four funds namely, Axis Equity Fund, Axis Liquid Fund, Axis Treasury Advantage Fund and Axis Tax Saver Fund.

Recently, non-banking finance company, SREI Infrastructure too had got an in-principal approval from SEBI to set up a fund house on its own.

The mutual fund industry is all set to grow even bigger as others are waiting in the wings to get approval from the market regulator. Some of them are Motilal Oswal, ASK Investment Holding, Indiabulls, and Mahindra and Mahindra Financial Services.