NEW DELHI, Nov 16: Retirement fund body EPFO will float tenders next week to appoint new fund managers for a term of three years beginning April 1, 2015.
EPFO has a subscriber base of over five crore. It manages a huge corpus of Rs six lakh crore with annual incremental deposits of over Rs 70,000 crore.
At present, Employees’ Provident Fund Organisation’s funds are being managed by asset management firms—SBI, HSBC AMC, Reliance Capital and ICICI Securities Primary Dealership. The term of these fund managers would end on March 31, 2015.
“EPFO will float tenders for appointment of fund managers next week. The process of appointment will take two to three months,” a senior official said.
The EPFO would have to complete the process for appointment of new asset managers before March 31, 2015 as the term of existing fund managers would end on that day.
In the November 11 meeting of the EPFO’s advisory body Finance Audit and Investment Committee (FAIC), the terms and conditions of the tender were discussed and firmed up.
The EPFO’s apex decision making body had decided to appoint credit rating agency CRISIL as consultant for the third time for engaging new fund managers and evaluating their performance at its meeting held on August 26.
CRISIL is expected to complete the process of appointment of new fund managers within three months.
In view of the delay in appointment of new fund managers, the EPFO trustees had extended the term of existing portfolio managers, custodian and external concurrent auditor up to March 31, 2015.
During the meeting, a source said, FAIC was unanimous on retaining the existing custodian, Standard Chartered Bank which is charging a ‘reasonable’ fee of Rs 72,000 per annum.
According to him, EPFO may decide to retain the services of Standard Chartered Bank as custodian.
The members of the FAIC were of the view of that custodian and auditors are appointed for a period of 10 years as per prevailing practice. Thus, they should be retained as their services are up to the mark and charges are also reasonable.
EPFO had appointed Standard Chartered Bank as custodian in July 2011. The body had appointed the four fund managers SBI, HSBC AMC, Reliance Capital and ICICI Securities Primary Dealership for managing its huge corpus in July 2011 for a three year term which began on November 1, 2011. (PTI)
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