SBI gives top rate of 9.7 per cent among PF fund managers
06 Apr 2009
State-owned lender State Bank of India has given a return of 9.7 per cent on provident fund deposits, which is over 50 basis above the top rate of 9.1 per cent offered by private sector provident fund managers for the quarter ended December 2008.
The other three fund mangers – all from the private sector - including Reliance AMC (9.1 per cent), ICICI Pru AMC (9.0 Per cent) and HSBC AMC (8.5 per cent) offered returns below the SBI's payout during the 17 September to 31 December 2008 period, an Employees' Provident Fund Organisation (EPFO) source said.
The EPFO, managing about 4.4 crore provident fund depositors, allowed the three private fund managers to manage its incremental deposits of about Rs25,000 crore per annum in July last year.
The aim was to improve the returns on EPFO's investments, which was earlier confined mostly to government securities and special deposit schemes.
The EPFO has invested Rs30,461 crore in central government securities, which earns a return of 7.25 per cent, and Rs20,000 crore in state government securities and loans, which fetches 7.5 per cent return.
Meanwhile, an advisory committee of the EPFO had, last month, rejected a finance ministry proposal to invest up to 15 per cent of its funds totaling around Rs1,82,000 crore in the stock markets.
The rejection of a proposal to park this corpus amount in publically-listed companies and mutual funds for higher returns came in the wake of continuing volatility in the stock markets.