SBI now in sole charge of EPFO funds, private managers axed

In an interim arrangement, the State Bank of India, the country's largest lender, will alone manage the Rs3.5 lakh crore funds with the Employees Provident Fund Organisation (EPFO) for the next three months.

The interim arrangement was announced after the Central Board of Trustees (CBT) of the EPFO turned down the proposal to extend the tenure of the three existing private fund managers - ICICI Prudential Asset Management Co Ltd, HSBC Asset Management (India) Pvt Ltd, and Reliance Capital Asset Management Ltd.
 
These along with the SBI have been managing the pension fund for the past two-and-half-years, but their contract with the labour ministry-controlled EPFO ends today.

''SBI alone will manage the entire retirement fund for the interim period of three months beginning 1 April,'' labour minister Mallikarjun Kharge said after the CBT meeting in New Delhi on Wednesday.

''We are in the process of selecting new fund managers within the next three months'' (by the end of June), said Kharge, who is also the head of CBT, which comprises representatives from the government, employees and employers.

The EPFO – the largest social security fund in the country - had engaged private fund mangers for the first time in July 2008. The three were managing close to Rs3 lakh crore of the total corpus, but trade unions saw this as a move to use ''workers' money for private speculative interests''. Prior to that, SBI alone used to manage the fund.

''The decision not to extend the tenure of these three private fund managers was almost unanimous,'' said Dipankar Mukherjee of the Centre of Indian Trade Unions.