The Hindu Business Line : UTI-I to foreclose two monthly income plans

THE Administrator of the Specified Undertaking of the Unit Trust of India (UTI-I) has announced the foreclosure of two monthly income plans - MIP 99 (II) and MIP 2000. The decision will be effective from August 1.

The "changed economic scenario and falling interest rates" are the two reasons why the income generated under the MIPs has gone down in recent times, a note circulated by UTI has mentioned.

This has led to a declaration of a mere 3.5 per cent income distribution for the four-month period ended July 31, 2004. The decision on foreclosure is in keeping in mind the interests of the unitholders of the two MIPs.

The maturity dates for MIP 99 (II) and MIP 2000 are October 31, 2004, and March 31, 2005, respectively.

In case of the former, investors who chose the monthly option will be paid Rs 10 per unit. Those who have chosen the annual and cumulative options will be paid Rs 10 per unit as well as the accrued income for the period April 1-July 31, 2004. Similar arrangements have been worked out for unitholders of MIP 2000.

All the assured return schemes of UTI have been transferred and vested in the Administrator of the Specified Undertaking of the Unit Trust of India (SUUTI).

Pursuant to the UTI (Transfer and Repeal) Act, 2002, UTI was divided into two entities - SUUTI (UTI-I) and UTI MF (UTI-II). The latter now manages a number of open-end mutual funds.