Punjab & Sind Bank plans to foray into mutual fund space; to finalise partner by Sep

New Delhi: In a bid to expand fee-based income, state-owned Punjab & Sind Bank is planning to foray into mutual fund space and hopes to find a partner by September, a senior official has said.

"The bank has already floated a Request for Proposal to finalise a partner in the Fintech space, and we hope to conclude the process soon," Punjab & Sind Bank managing director Swarup Kumar Saha told PTI.

He expressed hope that the bank would be able to zero in on a partner by the end of the second quarter and start operations during the current financial year.

The asset management business would help the bank in increasing fee income by cross-selling products, he noted.

There are 44 asset management companies operating in India. Assets Under Management (AUM) management by these companies stood at Rs 44,39,187 crore as of June 30, 2023.

The AUM of the Indian MF Industry has grown from Rs 8.11 lakh crore at June-end 2013 to Rs 44.39 lakh crore as of June 30, 2023, more than a five-fold increase in a span of 10 years.

Many public sector lenders, including the State Bank of India (SBI), have their mutual fund subsidiaries.

Talking about the growth plan for the current financial year, Saha said credit growth is expected to be 13-14 per cent, while deposit mobilisation would witness a growth of 8-10 per cent during the current fiscal.

With regard to recovery, he said the bank expects a recovery of Rs 1,500 crore and aims to keep fresh slippages under Rs 1,500 crore in the current financial year.

He further said that the provision coverage ratio should increase to 90 per cent from the present level of 88.58 per cent.

In terms of asset quality, he said, the bank aims to bring down gross NPA to 6 per cent while net NPA below 1.5 per cent during the year.