The New Fund Offer opens for subscription on 9th May and closes on 19th May. No entry and exit load is applicable
Kotak Mutual Fund will open the New Fund Offer (NFO) Kotak FMP Series 46, a close ended debt scheme with the duration of 370 days from the date of allotment of units.
The NFO opens for subscription on 9 May 2011 and closes on 19 May 2011. No entry and exit load is applicable. The scheme will allocate 100% of assets in debt, money market instruments and government securities with low to medium risk profile.
The scheme will be benchmarked against the CRISIL Short Term Bond Index.
The minimum application amount will be Rs5,000 and in multiples of Rs10 thereafter.
The scheme will be managed by Deepak Agrawal and Abhishek Bisen.
The investment objective of the scheme is to try to generate returns through investments in debt and money market instruments with a view to reduce interest rate risk. The scheme will invest in debt and money market securities, maturing on or before maturity of the scheme.
However, RBI’s move will raise the cost of borrowing for banks which leverage high on their CASA funds
Interest rates on money lying in savings bank (SB) accounts will go up by half a percentage point, with the Reserve Bank of India deciding to hike rates to 4%. Deposit-holders in SB accounts were receiving the rate fixed eight years ago.
However, the move will raise the cost of borrowing for banks which leverage high on the 'Current Account, Savings Account' (CASA) funds. These CASA deposits are much cheaper than the time deposits, where the going rate for 6 months and above is about 8%.
Unlike the time deposits, the SB account interest rates are still regulated even as the central bank has put out a discussion paper for freeing the same. Interest rates on fixed deposit schemes were deregulated in 1997.
The bank is scouting for a strategic partner, and will enter the business by January next year
The country's fourth-largest public sector lender, Bank of India (BOI), is planning to re-enter the mutual fund (MF) business by January 2012. The bank has already started scouting for a strategic partner for the venture and is likely to finalise its partner by the end of the second quarter and will hold a majority stake in the business.
Earlier, in 1990, the bank had entered the MF business by launching six schemes, but subsequently exited the business. Presently, it is selling other mutual funds through its network of more than 2,000 branches which will be the added advantage for its mutual fund business foray.
The wide branch network that state-run banks have, translates into a valuable distribution system for asset management firms after last year's regulatory moves that barred them from incentivising agents through investors' money. That has made public sector banks attractive to asset management firms, both as joint venture partners as well as third-party distributors.