Business Daily from THE HINDU group of publications
Thursday, Aug 03, 2006
Business Daily from THE HINDU group of publications Thursday, Aug 03, 2006 |
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Markets
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Mutual Funds Money & Banking - Private Banks Our Bureau
MR VIVEK KUDVA (left), President, Franklin Templeton India, with Mr Ananthakrishna, Chairman & CEO, Karnataka Bank, at a press conference held in Mumbai on Wednesday. — Paul Noronha
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Mumbai , Aug 2 Franklin Templeton Investments, on Wednesday, entered into an agreement with Karnataka Bank for distribution of its investment products. Karnataka Bank will initially distribute the entire range of Franklin Templeton funds through its 100 branches. This would later be expanded to the remaining branches. "The tie-up will make us a one-stop-shop for financial solutions. It will open up further opportunities to provide our vast client base with a wider choice of products to meet their diverse financial requirements and bolster our fee-based income,'' said Mr Ananthakrishna, Chairman, Karnataka Bank. The bank has already imparted training to its employees for advising MFs to clients. The deal is expected to help the bank to diversify its income schemes given that it would get a commission income of 2.5-3.0 per cent. "Currently, fee-based income contributes to 8 per cent of the total income and with this tie-up the fee-based income should increase marginally," said Mr Ananthakrishna. Speaking on the occasion Mr Vivek Kudva, President, Franklin Templeton Investments said, "Mutual Funds (MF) still constitute a very minor portion of the household savings pie. MF penetration is notched up at a petty 10 per cent in India.
Widen scope of co
The tie-up with Karnataka Bank will widen the reach of our MF products.'' He said that the investment company is on the lookout for similar tie-ups with other banks to foray into the rural market. Franklin Templeton is one of the largest fund houses in the country with over Rs 21,649 crore of assets under management and an investor account of over 18 lakh. It has offices in 33 cities and collection centres in another 45 locations across the country. Karnataka Bank, with immediate future plans to add 17 more branches next year, has a deposit base of Rs 13,243 crore and advances worth Rs 7791 crore. The bank is aiming for a business turnover of around Rs 25,000 crore in the current fiscal.
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