SBI Pension yields 16.68% on NPS for govt employees

A year after the launch of the New System Pension for central government employees,SBI Pension...

A year after the launch of the New System Pension (NPS) for central government employees,SBI Pension,the pension fund arm of State Bank of India,has generated highest return for investments made by Central government employees. The fund manager has given 16.68 per cent returns,followed by UTI MF at 13.12 per cent and LIC MF at 11.6 per cent respectively. These returns are calculated on mark-to-market basis.

The NPS corpus for the central government employees has about Rs 2,100 crore till date. SBI had the largest share of this corpus at 55 per cent amounting to Rs 1,155 crore,UTI had 40 per cent (Rs 840 crore) and LIC had only with Rs 105 crore 5 per cent of the corpus amount. The Pension Fund Regulatory and Development Authority (PFRDA) will be publishing the net asset values (NAVs) of the schemes in about three to four weeks. The PFRDA Trust is evaluating the performance of the fund managers. After that it will appoint third-party evaluators to review the performance. Once that is done,we will publish the NAVs (net asset values) on our website, said D Swarup,chairman,PFRDA.

As per the earlier mandate,PFRDA was to redistribute the corpus after one year on the basis of the cost and performance of the fund managers. But now,since all the fund managers have agreed to charge the same 90 paisa for every Rs 10 lakh the decision will be made on performance alone. The regulator should consider a longer time frame before taking any decision to redistribute the corpus. One year is too short to form opinion on performance, said Jaideep Bhattacharya,chief marketing officer (CMO),UTI Mutual Fund. When asked whether UTI MF will approach the regulator to get a larger slice of pension corpus,as the cost structure has become same for all the players,he denied comment.

The NPS for central government employees was launched from January 1,2004. However,the money was transferred to the pension fund managers on April 1,2008. At present,nearly 2.86 lakh central government employees have subscribed to the scheme. Apart from this,22 states have also agreed to join the system. However,none of them has transferred the money yet. Once they formally join in,the number of accounts will increase to 6-7 lakh.

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