The Hindu Business Line : Andhra Bank to vend UTI Mutual products

Mr Ashutosh Bishnoi (left), Chief Marketing Officer, UTI Mutual Fund, with Mr T.S. Narayanasami, CMD of Andhra Bank; Mr R. Balakrishnan, Executive Director; and Mr A.L. Nageswara Rao, General Manager of the bank, at a press conference in Hyderabad on Thursday. — A. Roy Chowdhury

Hyderabad , Dec. 2

BUOYED by the strategic alliance entered into with UTI Mutual Fund for the distribution of its schemes, Andhra Bank now expects to record substantial rise in business volumes.

It expects to record sales of around Rs 500 crore from selling mutual fund (MF) products of leading institutions during this fiscal, the bank's Chairman and Managing Director, Mr T.S. Narayanasami, said.

Addressing newspersons here on Thursday to announce the tie-up with UTI MF, he said the bank finds vast potential for mutual funds in the country. Citing a study, he said the investments of Indian households in mutual funds continued to be only around 6 per cent as against 50 per cent in the US and 17 per cent in the UK.

He was of the view that banks such as Andhra Bank, with vast network, core strength in payment systems and historical long-term relationship with large customers base, were in a position to personally sell variety of financial products such as deposits, insurance policies and mutual fund products.

Stating that the time has arisen for banks to reposition themselves as one-stop supermarkets for financial services, he said such a process would enable banks survive the competition and evolve into better financial intermediaries.

The Andhra Bank Executive Director, Mr R. Balakrishnan, said, "This is the reason why our bank is entering into arrangement with insurance companies and mutual funds. We had earlier set an internal target of achieving Rs 500 crore of business volumes from mutual funds and earn a net profit of Rs 20 crore for the current fiscal. But going by the encouraging results in selling MFs, we now plan to upwardly revise our targets."

Commenting on the alliance with Andhra Bank, the UTI MF Chief Marketing Officer, Mr Ashutosh Bishnoi, said the initiative reflects UTI MF's strategy to rapidly expand and value-add its access network to complement the MF's growth strategy in the Indian mutual fund sector.

"With this tie-up, around 11.5-million customers of Andhra Bank will get an opportunity to invest in various schemes of UTI MF," he said.

Stating that UTI MF was planning to open few more branches in Andhra Pradesh and two in the twin cities of Hyderabad and Secunderabad shortly, Mr Bishnoi said Andhra Pradesh has been one of the fastest growing States for UTI MF.

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