Around a month after announcing its decision to wind up its six debt fund schemes, American holding company Franklin Templeton has appointed Kotak Mahindra Bank to assist trustees of its asset management unit in India in monetising portfolios of the six schemes.
In a statement issued on Wednesday (May 20), Franklin Templeton said Kotak Mahindra Bank, through its debt capital markets team, would work closely with the trustees, to assist with all portfolio actions in these six schemes that are being wound up.
Franklin Templeton said Kotak Mahindra Bank would, whenever required, act as their agent and provide its independent advice and assistance to the trustees through the entire process. The appointment will provide the trustees with added experience and ability to monetise assets at the earliest possible time, it said.
“Franklin Templeton is committed to ensuring an orderly and equitable exit for all investors at the earliest possible time, and we will partner with the board of trustees and Kotak Mahindra Bank to ensure an efficient wind-up of these schemes while preserving maximum value for our investors,” said Sanjay Sapre, president of Franklin Templeton India.
Sujata Guhathakurta, president (debt capital markets) at Kotak Mahindra Bank, said the bank was looking forward to working closely with the trustees and the asset management company (AMC) to assist them in the wind-up of the six schemes, whose total market value was more than ₹25,000 crore as of April 22.
The schemes were low duration fund, ultra-short bond fund, credit risk fund, dynamic accrual fund, income opportunities fund and short term income plan.
Franklin Templeton took the decision as the COVID-19 crisis and the subsequent lockdown had resulted in the shortage of liquidity in ‘certain segments’ of the corporate bonds market. Also, the fixed-income segment of the mutual funds have been witnessing heavy redemptions, it had said.