UTI Asset Management Company, which runs one of the leading mutual funds of the country, has begun a fresh search process to find a full-time chief — a position lying vacant for over 21 months now.
The fund house today released an advertisement inviting applications for the position of Chairman and Managing Director, after its board last month agreed to initiate a fresh process to fill the position.
The decision has been taken after a previous search process failed to fill the post, as two of the short-listed candidates for the position of Chairman and Managing Director (CMD) could not muster the required support of either the board members or the shareholders.
An advertisement was issued last time in June 2012, but no candidate could be finalised for the position.
In its new advertisement, UTI AMC has said it is seeking further applications for the post of CMD to “realise the mission of becoming a world class asset manager“.
A pioneer in the Indian mutual fund industry and once the country’s top fund house, UTI MF has been relegated to fifth position for many months now below its newer rivals such as HDFC, Reliance, ICICI Prudential and Birla Sun Life.
However, it recorded the largest increase in assets under management for any fund house during the last quarter ended September 30, when its average AUM rose by Rs 9,860 crore to grow beyond Rs 70,700 crore.
The surge of over 16 per cent in UTI MF’s asset size was double the entire industry’s growth of about eight per cent.
Still, UTI AMC has lost considerable ground to its rivals, for which one of the often-cited reasons has been absence of a full-time chief to head the company.
The fund house became headless in February 2011, when its then chief U. K. Sinha left to become capital market regulator SEBI’s Chairman. It has been trying to appoint a full-time chief since then, but has not been able to do so for one or other reasons.
In its last attempt, the board proposed the name of Sunil Mehta, global insurance giant AIG’s India country head, as the new chief of UTI AMC, but his nomination was shot down by some of the shareholders.
Prior to that, another short-listed name, Leo Puri, consultancy major McKinsey’s senior adviser in India, was also red-flagged after complaints about his qualifications not meeting certain criteria mentioned in the job advertisement.
UTI AMC shareholders include four public sector financial institutions — LIC, State Bank of India, Punjab National Bank and Bank of Baroda with 18.5 per cent stake each, while 26 per cent holding is with US-based fund house T. Rowe Price.
In January this year, the board of UTI AMC appointed its Chief Finance Officer Imtaiyazur Rahman as an acting CEO till the appointment of a new full-time CMD.