MUMBAI: Seeking urgent steps to safeguard investors' interest due to Franklin Templeton Mutual Fund's decision to shut down six debt schemes, stock brokers' association ANMI has asked the government and capital markets regulator Sebi to appoint a high-powered committee to take over the management of the fund house and examine its investment decision.
In a letter dated April 26 the Finance Ministry and Sebi, the Association of National Exchanges Members of India (ANMI), which represents 900 stock brokers, has also requested for steps to safeguard further erosion of investor wealth and to inform the investors of these six schemes in a timebound manner about modalities for them getting back their investments. Franklin Templeton Mutual Fund closed six of its debt funds on Thursday, citing redemption pressures and lack of liquidity in the bond markets.
These schemes are Franklin India Low Duration Fund, Franklin India Dynamic Accrual Fund, Franklin India Credit Risk Fund, Franklin India Short Term Income Plan, Franklin India Ultra Short Bond Fund and Franklin India Income Opportunities Fund. The decision has led to concerns about the fate of investments and mutual fund industry body AMFI (Association of Mutual Funds in India) rushed in to assuage the same.
In its letter dated April 26, ANMI said that closure of the six schemes by the fund house has sent shock waves to the entire mutual fund investing community. The association alleged that Franklin Templeton MF had heavily invested in low rated papers in the debt market and had also put money into several lesser known companies.
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