EPFO to appoint fund managers by July-end

EPFO to appoint fund managers by July-end

New Delhi: Retirement fund body EPFO will appoint the multiple fund managers to manage its huge corpus of 3.5 lakh crore by 31 July, a month ahead of its latest deadline.

“Employees’ Provident Fund Organisation (EPFO) will be able to wind up the process of appointment of fund managers by 31 July," a Labour Ministry official said.

EPFO’s apex decision making body Central Board of Trustees, headed by labour minister, had decided to extend the timeline for appointment of fund managers to 31 August, on Friday.

The official said, “EPFO engaged consultant firm CRISIL, for appointment of fund managers, will open the financial bids on 8 July, and the process of shortlisting would not take more than a week."

Once shortlisting is done, the proposal would be placed before the CBT to take a final call. However, the next meeting of the trustees has not been scheduled so far.

The official said, “Since the Parliament’s monsoon session would start on 1 August, EPFO will try to appoint fund managers by 31 July."

CRISIL has already started processing technical bids on 24 June, and will not take more than 10 days to process bids, he added.

On 6 June, giving reasonable time for submitting technical and financial bids, the EPFO had asked the 10 AMCs who had earlier evinced an interest in managing its funds to submit their bids by 24 June.

EPFO had to appoint multiple AMCs by 30 June, so that the newly appointed managers could take over its fund by 1 July, for a three-year period, as desired by the CBT.

EPFO had also missed a deadline of 31 March, this year, the day on which the term of four fund managers, including ICICI Pru, HSBC AMC, Reliance Capital and SBI expired. It had planned to appoint new fund managers for next three financial yeas beginning 1 April.

Besides the four AMCs who had managed EPFO corpus, seven new firms, including Kotak Securities, Securities Trading Corporation of India, UTI Securities and ICICI Securities, have expressed interest in managing the retirement fund corpus.

The EPFO had appointed the multiple fund managers for the first time in July, 2008, with the objective of providing a better rate of return on deposits to its 4.72 crore subscribers.

Prior to this, SBI was the sole fund manager for it since its inception in 1952.