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Nilanjan Dey

SBI had not taken a decision as to final shape of the arrangement. The extent to which it will dilute its holding in the company, if any, is therefore not known.

Kolkata , May 31

STATE Bank of India will go ahead with a plan to rope in a partner for its mutual fund venture, SBI Fund Management Co. The proposal has been pending for a long time.

The bank has been in talks with a few foreign asset management companies and expects to home in on one of them to carry out its plan. While their identities are not being revealed at the moment, the bank claims that these are some of the best-known names in the industry.

The Chairman, Mr A.K. Purwar, said that SBI had not taken a decision as to final shape of the arrangement. The extent to which it will dilute its holding in the company, if any, is therefore not known.

"We have been in discussions with these parties. The matter (of offering equity) has not been settled", he stated, adding that fresh talks could lead to a number of possibilities.

SBI MF, it may be mentioned here, was earlier linked to at least one other overseas player, BNP, on the same count. However, the negotiations did not materialise into anything substantial. The bank had in recent times brought in joint venture partners, leading names in their respective areas of operation, for a couple of other businesses: insurance and credit cards. Its two allies are Cardiff and GE, respectively.

The fund, Mr Purwar conceded, had "not been a very aggressive" player in the domestic asset management industry in recent times. Its asset base stood at over Rs 5,200 crore at the end of the last quarter. That made the MF the second largest fund house in the category of `bank sponsored' outfits. While UTI MF (Rs 20,600 crore) was obviously the leader, the others in the category were funds promoted by Bank of Baroda (Rs 450 crore), Canara Bank (Rs 1,600 crore) and Punjab National Bank (Rs 100 crore).

More Stories on : Public Sector Banks | Mutual Funds

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