NFO – Birla SL Banking & Finance Sector Fund
Birla SL has launched the new fund offer of Birla SL Banking & Financial Services Fund, an open ended scheme. The NFO opens for subscription on 25 Nov 2013 & closes on 9 Dec., 2013. No entry load will be applicable for the scheme.
The financial sector consists of Banks, Non Banking Financial Services companies, Housing Finance Companies, Stock Broking Companies & Credit Rating Agencies etc.
The well developed sector yet under-penetrated financial sector is managed through a sound regulatory framework by the RBI, SEBI, and IRDA & PFRDA under the Ministry of Finance.
Why Banking & Finance Sector?
High Growth Sector
The banking sector was witnessed study growth, with 19% increased in Bank Deposits, 23% increase in Credit in the last 8 years. Non Banking Finance Companies have also shown a strong 26% growth in their asset base in the same period.
Driven by Recent Reform Measures
Area of Reform
Banking & Financial Services
|Issue of Bank licenses by Jan 2014||Financial inclusion & growth of an underpenetrated & underserved non-urban market.|
|Allow foreign banks to enter India & even take over domestic lenders.||The sector is expected to benefit from large global players’ transfer of technologies & best practices, & lead to healthy competition.|
|NHB allowed risk weightage on loans > Rs 75 Lakh, to be reduced from 125% to 75%||This would free up capital requirements & allow HFCs to lend more.|
|49% FDI in Insurance (from current 26%)||Help boost investments in the sector & attract more serious global players.|
|IRDA increased exposure limits to HFCs (for insurance co. investing in these)||This would allow insurers lend more to the sector, thereby providing access to valuable capital from the insurance sector to the HFCs.|
|Infrastructure||Cabinet committee on Investment for Fast tracking infra projects.||Already cleared over 171 projects worth Rs. 1.5 Lakh Cr. in order to kick-start the investment cycle, which is the need of the hour|
|Fiscal Consolidation||Reduce deficit to 3% by FY 17, through expenditure cuts, hike in railway fare, Diesel price deregulation & PSU Disinvestment.||Improved economic growth which would directly impact the growth of the sector, & throw up multiple opportunities for companies engaged in Infra Finance, Mortgages, CV finance, etc.|Issue Details Birla SL Banking & Financial Sector Fund Issue Open 25 Nov 2013 Issue Close 9 Dec 2013 Issue Type An Open Ended Banking & Financial Sector Scheme Face Value Rs 10 Entry Load Nil Minimum Application Amt 5000 Benchmark CNX Finance Fund Manager Mr. Satyabrata Mohanty