SBI Mutual eyes buyouts

SBI Mutual Fund (MF) may take over some small mutual funds in the next financial year. It is also in talks with a few national and regional banks to increase its cross-selling business.

P G R Prasad, managing director, SBI Funds Management, said: "Although we have had an organic growth so far, we are not averse to taking over some small mutual funds in the future."

"It is possible that in the next financial year, some acquisition may take place," he added.

Prasad also said that they are looking at mutual funds that may be of the size of "Rs 2,500 crore and above, as we need to ensure that our economies of scale are maintained."

SBI Mutual Fund recently entered into a tie-up with Paris-based Societe Generale Asset Management, through which the latter holds a 37 per cent stake in the former.

"We are, however, not looking at any similar tie-ups in the future as this would mean that we reduce our stake from the present 63 per cent as well," Prasad said.

"This is a comprehensive tie-up and we are looking at sharing the international best practices and skill in product design from Societe through this alliance," N Sethuram, chief investment officer, SBI Funds Management, said.

"This apart, we are in talks with a few national and regional banks to increase our cross-selling business," Sethuram said.

SBI MF has tie-ups with around seven banks like Andhra Bank, Catholic Syrian Bank, Lord Krishna Bank and Federal Bank, apart from the vast network of the State Bank of India that it has access to.

SBI MF is also looking for clearances for two new schemes from the Securities Exchange Board of India (Sebi). The mutual fund company has around 17 schemes and is likely to come up with around "three or four new schemes in the next few months".

SBI MF has Rs 6,200 crore worth assets under management, with an investment base of around eight lakh.

"By March 31, we are expecting the value of our assets under management to grow to Rs 7,500 crore," Prasad said. "This is mainly because of the new Magnum MidCap Scheme that we launched recently," he added.

Magnum MidCap scheme is an open-ended scheme that involves investment options in both stocks and bonds.

Takeover plans

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• SBI MF is also in talks with a few national and regional banks to increase its cross-selling business
  
  
• It is looking at mutual funds that may be of the size of Rs 2,500 crore and above
  
  
• SBI Mutual Fund recently entered into a tie-up with Paris-based Societe Generale Asset Management through which the latter holds a 37 per cent stake in the former
  
  
• SBI MF has tie-ups with around seven banks like Andhra Bank, Catholic Syrian Bank, Lord Krishna Bank and Federal Bank, apart from the vast network of the SBI that it has access to