Business Report :
The assets under management of RACE, one of the country’s largest mutual fund companies, are intact and have no gaps.
It has been found in the reports submitted to the Bangladesh Securities Exchange Commission (BSEC) of two independent custodians of the mutual funds, the Investment Corporation of Bangladesh (ICB) from the government sector and Brac Bank from the private sector.
ICB the trustee and custodian of 6 RACE-managed funds, including EBL1STMF, TBL1STMF, 1STJANATAMF, IFIC1STMF, FIRST BANGLADESH FIXED INCOME FUND, and EXIM1STMF says for the year 2024 it found Tk 1405.98 crore out of Tk 1,405.98 crore, or 100% of capital market investments of RACE-managed mutual funds it monitors, published the report on Saturday.
Similarly, BRAC Bank found Tk 831.83 crore out of Tk 831.83 crore, or 100% of capital market investments of 4 RACE-managed mutual funds 1STPOPulalifeMF, PHP1STMF, ABBANK 1ST, and 1STEBLNRBMF.
When approached to explain what these reports mean for the mutual fund industry, Professor Mazharul Islam, advisor of the Association of Asset Management Companies (AAMCMF), the trade body for the mutual fund industry, said, “This is good news for the mutual fund industry.” He also added, “The three pillars of RACE’s mutual fund are its asset management company, trustee (ICB), and custodian (BRAC) have all done their job in keeping the assets of the 10 largest funds in the market safe. This should give the investors and regulator confidence.”
An industry veteran and current managing director of another AMC shared his views: “In a meeting this year with AMCs, trustees, custodians, and auditors, BSEC and the Finance Ministry, a high-ranking BSEC officer said to all present that: “From the regulator’s view, if the assets of a mutual fund are intact and as reported, that is the strongest indicator that the fund manager did not engage in illegal activities.
It is the mark of 99.99% good health. The one or two asset managers who have misused funds did not pass this asset test. If we find all the assets intact, we should not unduly interfere in the management of the funds.” The industry veteran added, “then by BSEC’s own measure, these RACE-managed funds pass the 99.99% health mark.” So why all the negative commotion about the industry, he asked, which is hampering all business. Media must also play a positive role here and not ignore reporting on the big positives and just focus on small negatives that exist in all industries.
An industry in crisis the most damaging of which the long price floor was imposed by BSEC under then chairman ShibiRubayat, who is currently under the scanner of the anti-corruption commission and also under indictment by the courts.
The industry insider stated that over 70% of assets under the industry are facing continuous inspection inquiry enforcement. And the fund managers have little time to focus on the fund management or raising new assets.
Ahsan Habib, investor of mutual funds, said, “At least I used to get good dividends from the mutual funds I invested in. We market is gotten worse under the new government too.
