Franklin India May Take Over 5 Years to Return Some Funds: 10 Things To Know
- According to an email from the asset manager to investors, while investments in two of the six funds may be returned within five years, it may take the company more than five years to return the entire amount invested in the other four, Bloomberg reported citing documents confirmed by Franklin Templeton Mutual Fund.
- The timing could wind up being sooner, as any sale of the underlying assets in the frozen funds in the secondary market and prepayments or accelerated payments made by issuers of debt in the funds would quicken the payout.
- The fund manager had previously said it is seeking investor approval to liquidate the six debt schemes, according to Bloomberg.
- The combined assets of the six fixed-income and credit-risk funds, which had large exposures to higher-yielding, lower-rated credit securities, were worth about Rs 28,000 crore.Â
- These funds are: Franklin India Low Duration Fund, Franklin India Dynamic Accrual Fund, Franklin India Credit Risk Fund, Franklin India Short Term Income Plan, Franklin India Ultra Short Bond Fund and Franklin India Income Opportunities Fund.
- Days after Franklin Templeton's move on the six debt fund schemes, the Reserve Bank of India (RBI) announced a special liquidity facility worth Rs 50,000 crore for mutual funds in a bid to ease liquidity pressures in the sector as well as lift investors' confidence.
- Traditional bank deposits gained while spooked investors called for government intervention and debt mutual funds saw record withdrawals.Â
- Retail investors have for long been flocking to tax-friendly debt mutual fund schemes on the promise that they are as safe as bank deposits and with little concern for potential credit risks in case of a default.
- Meanwhile, the country's debt markets have been reeling since the pandemic prompted authorities to institute the world's biggest stay-at-home restrictions, which worsened liquidity in some corporate bonds. High net-worth individuals, corporate investors and retail investors usually park their funds in debt funds, due to higher returns compared to bank deposits, and easy liquidity.
- Already under stress since the collapse of infrastructure financier IL&FS in 2018, the country's credit markets are still under pressure as the economy has been hit hard by the strict lockdown meant to curb the deadly coronavirus outbreak.
-
Unhedged Position | Blue Wave Will Derail the AI Trade but Won't Dismantle the AI Era
The Democrats' sweep of the US Congress will see politics collide with economic forces both over the long and short term.
-
It's Time To Take The GST Council's Bet On Trust Global
Payment records can prove India's services exports, and clear, proportionate rules can bring foreign digital sellers into the tax net.
-
Opinion | India at 38: From Innovation Overperformer to Innovation Powerhouse
India now has 453 VC-backed deep science startups, 18 of them late-stage, after 117 percent growth since 2020. Laurus Labs, at USD 9.3 billion, is the most valuable deep science company in any middle-income economy outside China.
-
Navigating Energy Crossroads: S Jaishankar's Call For Diversified Supply Chains At G20 Ministerial Meeting
As geopolitical fault lines continue to test maritime trade routes and commodity flows, Jaishankar's message remains pertinent: true economic resilience requires open markets, protected transit lines, and a genuine commitment to multilateral cooperation rather than coercion.
-
Indians Are Travelling, But Not Every Journey Is A Holiday | The Week In Whys
Pilgrims, patients and working women are the real travellers, and the system hasn't quite caught up with them.
-
Getting To Work Costs Women More | The Reason Why
It is not just about women paying more than men. It is about women paying much more in cities than in villages.
-
AI Bias In Investing Cannot Be Eliminated, But It Can Be Governed
Framing is a particularly important example as identical financial information presented in terms of gains rather than losses can lead an LLM to reach a different assessment.
-
Joining The Dots | Dark Skies, Steady Diya: Why Hope Holds This Diwali
With war, a weak rupee and foreign outflows weighing on sentiment, policymakers at the NDTV World Summit and market veterans at NDTV Profit Ignite: Diwali Edition offered the same advice: stay invested and filter out the noise.
-
The Curious Case of Equitas Small Finance Bank And A CEO Who Quit For Stock
PN Vasudevan believes persistent investor concerns over a perceived conflict of interest had become a governance overhang on Equitas Small Finance Bank's stock, even as the lender improved profitability and asset quality.
