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Union Bank forms mutual fund venture

MUMBAI: Union Bank of India has formed a joint venture with leading Belgian financial player KBC Group to launch mutual fund business. Bank Chairman M. V. Nair and KBC Group CEO Andre Bergen signed the shareholders agreement to the effect in the presence of King Abert II of Belgium in Mumbai on Friday. Union Bank will have 51 per cent stake in the joint venture, while the remaining will be held by the Belgian group.

The initial capital of the new company will be Rs. 50 crore which would increase as the business expands, bank officials said. When asked about the timing of entering the MF business when the markets are in turmoil, he said it was the right time to enter the market. He, however, pointed out that he would apply for SEBI licence to launch the mutual fund the and operations might commence about a year from now.

Erwin Schoeters, Managing Director of KBC Asset Management, the mutual fund arm of the KBC group, said one could break even in the mutual fund industry at an asset under management (AUM) of about Rs. 6,000 crore. — PTI

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