Business

LIC, SBI, BoB get time to pare stake in UTI AMC

SEBI sets December 2020 deadline

The Securities and Exchange Board of India (SEBI) has directed Life Insurance Corporation of India (LIC), State Bank of India (SBI) and Bank of Baroda (BoB) to bring down their respective holdings in UTI Asset Management Company (UTI AMC) to below 10% by December 31, 2020.

Further, the capital markets regulator has said that in case the entities fail to reduce their holdings, then their shareholding and voting rights in excess of 9.99% would be frozen.

“In the event of non-compliance... the shareholding and voting rights of the noticees in UTI AMC and UTI Trustee in excess of 9.99% and corporate benefits thereon shall stand frozen till such time the noticees comply,” stated the SEBI order issued on Friday.

The three entities have to reduce their holding in UTI AMC since the regulatory framework does not allow the sponsor of a mutual fund entity to hold more than 10% in another fund house. All the three entities — LIC, SBI and BoB — have their own fund houses and so, have to reduce their stake in UTI AMC.

Currently, LIC, SBI and BoB each have a 18.24% stake in UTI AMC. Incidentally, the earlier deadline for the three entities to bring down their holding in the mutual fund entity was March 12, 2019.

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Printable version | Feb 19, 2020 11:44:26 PM | https://www.thehindu.com/business/lic-sbi-bob-get-time-to-pare-stake-in-uti-amc/article30220623.ece

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