MF ASSETS RECORD NEW HIGH

The Indian mutual fund industry's assets under management jumped 9.4 per cent to a record high of Rs 9.03 lakh crore in January on the back of strong inflows into liquid funds. According a report by Crisil, the mutual fund industry's assets under management (AUM) was at Rs 8.25 lakh crore in December 2013. The figure stood at Rs 8.90 lakh crore in November 2013. There are about 45 fund houses in the country. The rise in monthly AUM in January 2014 was primarily on account of Rs 83,500 crore inflows -- the highest since April 2013. "Bulk of the inflows during the month was into money market/ liquid funds," the Crisil report said. As per the report, liquid funds saw net inflows worth Rs 77,500 crore, the highest in nine months, leading to a 43 per cent rise in the segment's AUM to Rs 2.59 lakh crore. This was chiefly due to periodical inflows in the banking system – quarter-end outflows (December) in the category are typically reversed in the subsequent month (January). Besides, income funds (long-term, short-term and ultra short-term debt funds, and fixed maturity plans, or FMPs) reported net inflows of Rs 5,900 crore after two consecutive months of outflows in November and December. Inflows were primarily into short-term maturity debt funds and FMPs due to the attractive short-term rates caused by the RBI's monetary tightening measures. Equity funds' recorded inflows for the third consecutive month in January at Rs 427 crore. However, the amount was less than Rs 699 crore in November and Rs 857 crore in December. The category's assets, however, declined four per cent to Rs 1.75 lakh crore during the month, dragged lower by weakness in the underlying market. Meanwhile, investors continued to exit gold exchange traded funds (ETFs) and gilt funds. 

FORIEGN ASSETS DOWN BY 19%

Foreign Assets of mutual fund (MF) companies declined by 18.8 per cent to about Rs 3,190 crore in 2012-13, data from the Reserve Bank showed today. "Foreign assets of MFs declined from Rs 39.3 billion in March 2012 to Rs 31.9 billion as at end-March 2013; as a consequence, net liabilities of MFs declined by Rs 46.4 billion to Rs 351.4 billion in March 2013," said RBI data on Survey of India’s Foreign Liabilities and Assets for the Mutual Fund Companies – 2012-13. Equity holdings were the major component of MFs' foreign assets which declined from Rs 38 billion in 2011-12 to Rs 30.8 billion in 2012-13. None of the MF companies invested in debt securities abroad, it said. Also, the foreign liabilities of the 45 MFs in the list declined by 12.3 per cent from a year ago to Rs 383.4 billion in FY13. "Units issued to non-residents, the major component of foreign liabilities at face value, declined from Rs 256.6 billion in March 2012 to Rs 217.4 billion in March 2013." Country-wise, Luxembourg (58.4 per cent) was the major country with respect to foreign assets of MFs, followed by USA (15.6 per cent) and Hong Kong (5.9 per cent). UAE, USA, UK, Singapore, Mauritius, Canada and Hong Kong were the other major countries which together accounted for nearly 35 per cent of total foreign liabilities in FY13. In terms of Asset Management Companies, their foreign liabilities rose by 15.7 per cent to Rs 32.9 billion and foreign assets increased by 7.4 per cent to Rs 1.7 billion.
"As a consequence, net liabilities increased from Rs 26.9 billion in March 2012 to Rs 31.2 billion in March 2013." Country-wise, Mauritius accounted for the maximum share of foreign liabilities (29 per cent), followed by UK (19.5 per cent) and Japan (15.8 per cent) for AMCs. Singapore and Guernsey accounted for more than two-thirds share in foreign assets of AMCs in March 2013, it added. RBI data was based on 45 companies which held foreign assets and/or liabilities for FY13 and FY12.