Banks seem to be taking away all the cream when it comes to earning commissions from sale of mutual funds,as there are as many as seven banks among the top-ten mutual fund distributors in terms of commissions paid to them.
As per the latest disclosure of commission and expenses paid by various fund houses to their distributors,HSBC,HDFC Bank and Citibank top the chart for the last fiscal ended March 31,2012.
Besides,there are four other banks among the top-ten commission earners — Standard Chartered Bank,Axis Bank,ICICI Bank and Kotak Mahindra Bank.
According to the distribution commission disclosure made by the industry body AMFI (Association of Mutual Funds in India),there were seven banks among the top-ten distributors on this parameter in the previous fiscal 2010-11 as well.
Besides,all these seven banks recorded an increase in the payments paid to them by the fund houses for distribution of mutual fund products,even as the industry had been raising concerns till recently about their businesses being hurt by the regulations regarding lack of sufficient incentives for sale of mutual fund products.
There has been only one change among these seven banks with ICICI Bank replacing public sector giant SBI in the top-ten. SBI is the only major bank to have witnessed a
decline in the mutual fund distribution payments made to it during the last fiscal,pushing it out of the top ten.
AMFI has listed out a total of 269 mutual fund distributors,who were collectively paid about Rs 1,860 crore during 2011-12 towards commission and expenses towards sale of MF products. These distributors recorded an increase of about Rs 163 crore in such payments from Rs 1,697 crore in the previous fiscal 2010-11.
The list for 2011-12 only includes those distributors who are operating from more than 20 locations.