MFs' foreign liabilities rise by Rs 2,310 cr in FY16

Foreign liabilities of mutual funds (MFs) increased by Rs 2,310 crore to Rs 58,170 crore at market value during 2015-16 financial year.
Units issued to non-residents, which had a dominant share within liabilities, increased from Rs 55,810 crore in March 2015 to Rs 58,120 crore in March 2016, though the increase in terms of face value was much lower, from Rs 23,540 crore to Rs 25,940 crore, over the same period, the RBI data showed.
Other foreign liabilities arising out of unpaid income / dividends to non-residents, sale proceeds pending repatriation, marginally declined.
On the contrary to the movements in foreign liabilities of MFs, their foreign assets declined by Rs 210 crore during 2015-16 to Rs 3,850 crore in March 2016, where equity securities had an overwhelming share of Rs 3,830 crore.

"As a consequence, net foreign liabilities of MFs increased by Rs 2,530 crore during 2015-16 to Rs 54,320 crore (USD 8.2 billion) in March 2016," RBI said.
In case of foreign liabilities, the UAE, Singapore, the UK, Mauritius and the US together accounted for 47.7 per cent and 46.7 per cent share at face value and market value, respectively.

In regards to foreign assets, Luxembourg continued to be the major overseas investment destination (equity securities held abroad) of MFs, followed by the US.
In case of asset management companies (AMCs), foreign liabilities increased by Rs 550 crore during 2015-16 to Rs 4,380 crore in March 2016.

Foreign assets of AMCs increased from Rs 220 crore to Rs 390 crore during the year and, as a consequence, their net foreign liabilities increased by Rs 390 crore during 2015-16 to around Rs 4000 crore in March 2016.
The UK accounted for the maximum share in foreign liabilities, followed by Mauritius and Japan. Guernsey and Singapore together accounted for around 73 per cent of total foreign assets of AMCs in March 2016.
Foreign Direct Investors' reinvested earnings in the AMCs, estimated from their share in the difference between company's net profit and distributed dividends, increased from Rs 350 crore in 2014-15 to Rs 540 crore in 2015-16.