The chairman of India`s largest mutual fund manager, the Unit Trust of India (UTI), P S Subramanyam, has resigned, a government official said on Wednesday. His resignation followed in the wake of suspension of UTI’s flagship US64 scheme. K G Vassal has taken over as the interim chairman. According to finance ministry sources his resignation has been accepted.
Subramanyam confirmed he had quit. "I have put in my papers and the government has accepted my resignation," he told Reuters in Bombay.
Finance Minister Yashwant Sinha on Tuesday assured investors that his ministry will scrutinise the freeze on sale and repurchase of US-64. “We normally like financial institutions to function on their own without interference in day to day working. But the results announced on Monday are distressing,” he said adding the entire issue will be closely scrutinised.
“We will go into all aspects regarding the issue of freeze of sale of US-64 for six months and the issue of sale of strategic holdings by UTI,” said Sinha. Meanwhile, Confederation of Indian Industries (CII), on Tuesday, expressed its `strong reservation` against UTI`s decision to unilaterally suspend trading in US-64 units for the next six months saying the move amounted to `breach of faith` for unit holders.
“This virtually amounts to breach of faith...No different from a bank suddenly deciding to shut its windows and leaving depositors in the lurch,” CII president Sanjiv Goenka said in a statement in New Delhi.
Bureau Report