11 AMCs in race to manage EPFO funds for next 3 years

As many as 11 asset management companies, including HSBC, UTI and ICICI Securities, are in the fray to manage EPFO's huge provident fund corpus of Rs 3 lakh crore for three years beginning April.

ICICI Pru, HSBC, Reliance Capital and SBI are existing fund managers, which were appointed in July 2008 and their tenure will end in March this year.

Besides, existing fund managers, seven new firms, including Kotak Securities, Securities Trading Corporation of India, UTI Securities and ICICI Securities, have sent their expression of interest (EoI), a source said.

The Employees' Provident Fund Organisation (EPFO) had invited expression of interest or request for qualification which were to be submitted by last evening.

Source said that by February 25, EPFO would request for proposal or bids for managing its Rs 3 lakh crore corpus for a period of three years starting April 1, 2011.

The shortlisted asset management companies would be given about 10 days time to submit their bids, sources said, adding that 15-20 more days would be required to prepare the list of successful bidders.

The list of qualified bidders would be placed before the EPFO's apex policy making body Central Board of Trustees for taking the final call.

The decision of the CBT headed by the Labour Minister regarding appointment of fund managers would be final.

The EPFO trustees are likely to meeting on the second of the next month when this matter would be placed before them.

EPFO had appointed four fund managers for the first time in July 2008 for managing its corpus with an idea of improving yields on investments.

Prior to the appointment of fund mangers, SBI was the sole fund manager for the EPFO.

EPFO has engaged credit rating agency CRISIL for appointment of the fund managers as well as monitoring their performance for the next three fiscals on quarterly basis.