SBI ties up with UTI Mutual Fund
Mumbai, Mar 25 (UNI) For the first time in its history, India's premier banking major, State Bank of India (SBI), has entered into a tie-up with another institution, UTI Mutual Fund, to market the latter's mutual funds products.
This, therefore, marks the first time that SBI will be vending a third party's MF products. Till now, State Bank of India used to only market its own mutual fund subsidiary's (SBI MF) products.
Announcing the tie-up to the media here today, SBI Chairman and Managing Director A. K Purwar, said that his bank had identified 48 centres across the country in the initial phase from where UTI MF products would be sold.
By virtue of this tie-up, SBI will offer the entire bouquet of UTI MF's schemes across the bank's selected branches.
''This tie-up between the two largest players in their respective fields will enable SBI to leverage its unmatched branch network and customer base to cross-sell a range of mutual fund products and thus open up a new revenue stream,'' Mr Purwar said.
For UTI MF, the tie-up opens up a new marketing vista in the form of SBI's 9,000 branches across the country, thereby tremendously augmenting its products' marketing reach.
''In today's dynamic market scenario, one has to constantly scout around for alternative and innovative marketing channels and we feel the tie-up with SBI will help us tremendously,'' said UTI AMC Chairman and Managing Director U K Sinha.
State Bank of India will get distribution commission from marketing UTI MF's products and while Mr Purwar admitted that there could be a drop in SBI MF's sales as a result of the tie-up, he pointed out that it would only be ''temporary.'' ''We at SBI are looking at the larger picture. It is important to give the customer not just one product but a variety of products and let him choose what he wants,'' he said.
This would constitute an important non-fund based income stream for not only SBI but also other banks in the future, he averred, adding that last year, SBI earned a revenue of Rs 3,000-crore from distributing its own mutual funds products.
UNI JJ KU AG1543