Mumbai, Nov 7: Union Bank of India (UBI) and KBC Asset Management, the globally active asset manager of the Belgian KBC group has formally signed the shareholders agreement to set up a joint venture asset management company in India, in which they will take a stake of 51 per cent and 49 per cent respectively.
UBI Chairman and Managing Director Mr M V Nair and KBC group Chief Executive Officer (CEO) Mr Andre Bergen, in the presence of His Royal Highness King Albert II of Belgium and Belgian Foreign Affairs Minister Mr Karel De Gucht, signed the shareholders agreement. After signing the agreement, Mr Nair told mediapersons,''The Indian mutual fund industry has been growing at a rapid pace of 47 per cent year on year over the last five years. however, current penetration levels are just three to four per cent clearly indicating the vast untapped potential.
The Capital Adequacy Ratio (CAR) for the bank stood at 12.53 per cent at the end of September 2008. Union Bank is one of the first public sector banks in india to set up a separate division to undertake distribution of third party products such as mutual funds and insurance and has in the last six years developed considerable marketing and cross selling capabilites in this area. Union Bank will shortly open in Belgian.
Meanwhile, Mr Andre Bergen said, ''The joint venture is KBC Asset Management's first step into the Indian asset management market. Their knowledge of local investors and their extensive network of branches and points of services, combined with expertise of KBC's, especially in capital-protected investment funds for retail customers, represent for us the perfect blend of ingredients to create a joint top asset management company for retail and corporate investors in India.'' He further stated, ''It is mainly active on KBC's home markets of Belgium and Central and Eastern Europe, but it is also stepping up its activities in other growth markets like China, Taiwan, Hong Kong, South Korea, New Zealand, Spain, Netherland, US, Switzerland, Germany and Austria.