Private sector lender Yes Bank Ltd on Wednesday said it has got an in-principle approval from capital markets regulator Securities and Exchange Board of India or Sebi to get into the asset management and mutual funds business in India.
“Yes Bank receives in-principle approval from Sebi for setting up of Mutual Fund, Asset Management and Trustee Co,” the bank said in a filing on stock exchanges.
In October 2015, the Reserve Bank of India (RBI) had given a go-ahead to Yes Bank to set up a mutual fund, asset management company (AMC) and a trustee company.
Once Yes Bank secures Sebi’s final approval, it will become the 44th mutual fund company in the country, provided the bank chooses to launch its own MF business rather than acquiring the MF assets of any other existing fund house.
During 2015, the bank was indeed in talks with some of the existing AMCs to acquire their MF assets and get a ready-made portfolio to start AMC operations.
According to a Mint report on 15 January 2015, Yes Bank managing director and chief executive officer Rana Kapoor had confirmed that the bank was open to acquiring an asset management business, but declined to disclose names, citing confidentiality agreements.
The Mint report had mentioned that Yes Bank was in talks with at least three AMCs to establish a mutual fund business in India and Deutsche Mutual Fund was one of them.
According to industry lobby group Association of Mutual Funds in India (Amfi), for the quarter ended 30 June, the industry had average assets under management worthRs.14.4 trillion.
When it got RBI’s nod in October, the lender had said in an exchange filing that its AMC will channelize savings of retail and institutional investors in equity and debt capital markets. “This will complement Yes Bank’s retail liabilities strategy and also allow the AMC to leverage the Bank’s distribution network for customer acquisition,” Yes Bank had said.
This story was first published on Livemint