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Rediff News  All News  » Business » HSBC, ICICI Pru, SBI to manage PF

HSBC, ICICI Pru, SBI to manage PF

July 25, 2008 18:48 IST
Leading private financial players HSBC and ICICI Prudential along with country's largest bank SBI have been shortlisted to manage about Rs 25,000 crore (Rs 250 billion) in provident fund of about four crore employees annually.

"Three asset management companies, including HSBC, ICICI Prudential and SBI have qualified in the financial bid round," a member of the Finance and Investment Committee (FIC) of Employees Provident Fund Organisation (EPFO) told PTI.

Earlier, 10 companies, including Reliance, Birla Sun Life, HDFC, had qualified in the technical round, and later seven companies submitted financial bids.

He said HSBC and ICICI Prudential have been selected as they quoted the lowest fee of one basis point, or 0.01 per cent, of the fund to be managed.

Though, the fee quoted by SBI and Reliance were almost same, but SBI qualified the financial bid round as it had scored more points on technical grounds.

Three players shortlisted by the FIC could be appointed to manage funds after Central Board of Trustees (CBT) gives its nod. It is scheduled to meet here on July 29.

The total corpus of EPFO is around Rs 2,40,000 crore (Rs 2400 billion) with incremental deposits to the tune of Rs 25,000 crore (Rs 250 billion) every year. Initially, the EPFO would ask the fund managers to manage the incremental deposits only.

Sources said once the private players succeed to offer better returns, they could be asked to manage additional funds. It would help the EPFO to offer high interest rate to its subscribers as against 8.5 per cent at present.

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