Mumbai: The Securities and Exchange Board of India (SEBI) has convened a meeting here today of industry stakeholders, including chief executives of mutual fund (MF) houses, to discuss larger policy issues, current market situation and preparation for the ensuing Budget.
SEBI Chairman UK Sinha will be attending the meeting, as per the invite sent to CEOs of all 45 MF houses.
"SEBI has always, in collaboration of industry stakeholders, discussed various views and outlines the way forward for the mutual fund industry," it said.
"The exercise is mainly intended to help us assess the current market situation, contribute to our policy agenda in the coming year and also prepare for the ensuing Budget."
It is learnt that such a meeting is being organised for the first time after several years. The outcome will be shared shortly after the meeting.
"It is admirable that the regulator is trying to get information from the stakeholders about the current market situation and also discuss the industry's recommendations for the Budget," LIC Nomura AMC Chief Executive Nilesh Sathe said.
Though fund house CEOs have dubbed the conclave as a routine annual interaction, they privately believe the contentious issue of payment of high upfront commission by some large MFs in a bid to retain their independent financial advisors and simplification of rules relating to the existing Rajiv Gandhi Equity Scheme may come up for discussion.
Some large MF houses are paying upfront commission to the tune of 9 per cent in violation of the 3 per cent cap set by the regulator during the first year of investment in a scheme. This was a matter of concern for mid and small-sized players, said the CEO of a MF house.
The MF houses are of the view that the structure of Rajiv Gandhi Equity Scheme, designed exclusively for the first time retail individual investors, needs to be simplified so as to make it more popular.
The scheme is very good, but it needs some structural changes to make it more popular among the first time investors in mutual fund, head of another MF house said.
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