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PNB open to shedding stake in UTI MF

Our Bureau

Kolkata , July 8

CLOSE on the heels of State Bank of India expressing its willingness to consider taking over UTI Mutual Fund, another sponsor — Punjab National Bank — has expressed a willingness to scrutinise proposals to offload its holdings in the asset management company in favour of SBI.

Mr S.C. Gupta, PNB's Chairman and Managing Director, addressing media persons at a FICCI-organised meeting in Kolkata, said there was no concrete proposal at present to offload its holdings in UTI MF. Other sponsors of UTI MF are Life Insurance Corporation and Bank of Baroda. Incidentally, like SBI, LIC too has its own asset management business.

PNB recently reorganised its asset management business in association with Principal Mutual Fund. In May last year, it (along with Vijaya Bank), bought a critical stake in Principal MF.

Mr Gupta added that the bank was looking at a 20 per cent growth this year, to be triggered by an increase in advances and deposits. It will soon work out a reorganisation programme with the help of the Boston Consulting Group. PNB is also examining the possibility of performance-linked payment to its staffers.

The bank, which has a capital adequacy of nearly 15 per cent, is not willing to dilute the Government's stake further. The Government now holds 57 per cent, following two public issues, the last of which was floated earlier this year.

PNB Gilts to turn around

PNB Gilts, the primary dealer promoted by the bank, is set to turn in a positive performance this quarter — which will be an improvement over the last year. The company, a listed entity, is expected to announce its quarterly results on July 21.

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