EPFO likely to retain Crisil as consultant for third time

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Retirement fund body EPFO is likely to retain Crisil as consultant for the third time to engage new fund managers and evaluate their performance for three-year term beginning April 1, 2015.

The EPFO's advisory body Finance, Investment and Audit Committee (FIAC) has recommended the name of Crisil Ltd for appointment as consultant to its apex decision making body, the Central Board of Trustee (CBT), as per the agenda of trustees' meet scheduled on August 26.

The FIAC's suggestion is based on recommendations of a panel for the purpose, which was constituted by CBT in January.

Among three bids received by the EPFO's selection committee, CARE and Brickwork Ratings were in the race to grab the contract. But Crisil was selected based on its lowest bid.

Once the CBT approves the appointment of Crisil as consultant, the rating agency would take at least three months time to appoint fund managers for EPFO.

The Crisil will be responsible for selection of fund managers, custodian and concurrent auditor and performance evaluation of selected portfolio managers.

Crisil was appointed by EPFO as consultant for the first time in 2008 for appointing as well as monitoring fund managers' performance.

EPFO had appointed four fund managers in August 2008 - HSBC AMC, ICICI Pru, Reliance and SBI - for managing its huge corpus over Rs 3 lakh crore for a three term expiring on March 31, 2011.

The Crisil was engaged again in December, 2010 by the EPFO as consultant for the purpose.

The credit rating agency assisted the EPFO in appointing four fund managers -- SBI, HSBC AMC, Reliance Capital and ICICI Securities Primary Dealership for a term of three years beginning November 1, 2011.

In view of the delay in appointment of new fund managers, the EPFO has also recommended to extend the term of existing portfolio managers, custodian and external concurrent auditor up to March 31, 2015.

Among the existing fund managers, SBI remained at the top by providing 9.22 per cent return on investments against the benchmark yield of 9.11 per cent for a cumulative period from November 1, 2011 to March 31, 2014.

During the period under review, HSBC AMC provided an yield of 9.2 per cent followed by Reliance Captial AML at 9.19 per cent and ICICI Securities Primary Dealership at 9.18 per cent.

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