The Hindu Business Line : BoI sells two MF schemes to Taurus

The `Boinanza equity linked saving on tax scheme' and the `Boinanza Exclusive growth scheme' have a total corpus of Rs 22 crore, and have been sold on an asset liability basis to Taurus whereby Bank of India will get a commission of around 2 per cent over the NAV.

The third scheme that remains with the bank, matured on March 31, 2002. The bank is expecting an outgo of around Rs 20 crore when the `80ccb growth-cum-tax saving scheme is redeemed'.

Bank of India started the mutual fund business with a total of six schemes. Its biggest scheme was an assured returns scheme, `D2 plus' where investors were promised Rs 400 for every Rs 100 invested, in 10 years' time. The total outgo towards these redemptions were to the tune of Rs 1,000 crore and the bank had to help the asset management company in meeting a shortfall of around Rs 50 crore, according to sources.

According to bank officials, the deal with Taurus is a mutually beneficial one as it is the right time for the bank to exit the mutual fund business and Taurus gets a readymade investor base.

The Reserve Bank of India has been nudging public sector banks in the direction of rationalising their subsidiaries that were considered a `drag' on the bank. Bank of India is also in the process of merging its merchant banking subsidiary, `Bank of India Finance Ltd' with the bank.

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