Today, the Reserve Bank released the results of the 2016-17 round of the Survey of Foreign Liabilities and Assets of the Mutual Fund (MF) Companies on its website. The survey covers 44 Indian MF companies and their Asset Management Companies (AMCs), which held/acquired foreign assets and/or liabilities during the reference year 2016-17 and/or in the preceding year (See Annex for list of companies). The financial year-end position was collected from MFs through Schedule 4 in respect of units issued to non-residents, unpaid dividend, redemption of units issued to non-residents and MFs’ overseas investments. Information on the stock of external assets and liabilities of the AMCs were collected through the Annual Return on Foreign Liabilities and Assets (FLA). Highlights: I. Mutual Fund Companies:
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Foreign liabilities of MF companies stood at ₹ 719.8 billion in March 2017 of which units issued to non-residents accounted for 99.8 per cent. The remaining liabilities included unpaid income/dividends to non-residents and sale proceeds pending repatriation.
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Large valuation changes caused a surge in foreign liabilities of MFs during 2016-17, with the rise in the market value of units (23.6 per cent) far exceeding the growth in their face value (4.0 per cent). As a result, the ratio of market value to face value of liabilities increased to 2.66 in March 2017 from 2.24 a year ago, indicating valuation gains during 2016-17 (Tables 1 & 2).
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Foreign assets of MF companies (mainly equity securities) amounted to ₹ 38.7 billion in March 2017, which was only 5.4 per cent of their foreign liabilities, indicating that they held most of their assets within the country. The net foreign liabilities of MF companies stood at ₹ 681.1 billion (US$ 10.5 billion) in March 2017 (Tables 1 & 3).
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UAE, Singapore, UK, USA and Mauritius together accounted for nearly half of the MF Units held by non-residents in March 2017. Units held in Mauritius recorded a 48 per cent decline, coinciding with the signing of the Protocol to amend the India-Mauritius Double Taxation Avoidance Agreement (DTAA) during 2016-17 (Tables 4 & 5).
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USA and Luxembourg remained the major overseas investment destinations for MFs companies (Table 6).
II. Asset Management Companies:
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AMCs associated with MFs had net foreign liabilities of ₹ 52.4 billion (US$ 0.8 billion) in March 2017 (liabilities of ₹ 56.8 billion and assets of ₹ 4.4 billion). Foreign liabilities of AMCs were largely owed to non-residents in Mauritius, UK and Japan whereas Guernsey was the main destination of their relatively small overseas assets (Tables 7, 8 & 9).
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The reinvested earnings of foreign direct investors in the AMCs (estimated from their share in the difference between a company’s net profit and distributed dividends) stood at ₹ 5.3 billion in 2016-17 (₹ 5.4 billion in the previous year).
The results of the previous survey round for the year 2015-16 was placed in the public domain vide press release dated August 4, 2016. Ajit Prasad
Assistant Adviser Press Release: 2017-2018/635
| Table 1: Mutual Fund Companies – Foreign Liabilities and Assets |
| Item |
End-March 2016 |
End-March 2017 |
% Growth
(₹ terms) |
| ₹ million |
US$ million |
₹ million |
US$ million |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| Foreign Liabilities |
581,678 |
8,769 |
719,807 |
11,117 |
23.7 |
| Foreign Assets |
38,048 |
574 |
38,700 |
597 |
1.7 |
| Net Liabilities |
543,630 |
8,195 |
681,107 |
10,520 |
22 |
Notes: 1. The amount in US $ terms is arrived at by using the RBI reference rate (end-March).
2. Liabilities / Assets are valued at market prices unless stated otherwise.
3. Sum of constituent items may not add up to total due to rounding off.
4. These are also applicable for the remaining tables. |
| Table 2: Mutual Fund Companies – Non-Resident Holding of Foreign Liabilities |
| Item |
End-March 2016 |
End-March 2017 |
% Growth
(₹ terms) |
| ₹ million |
US$ million |
₹ million |
US$ million |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| Face Value of Units |
259,440 |
3,911 |
269,801 |
4,167 |
4.0 |
| Market Value of Units |
581,214 |
8,762 |
718,427 |
11,096 |
23.6 |
| Other Foreign Liabilities |
464 |
7 |
1,380 |
21 |
197.4 |
| Table 3: Mutual Fund Companies – Foreign Assets |
| Item |
End-March 2016 |
End-March 2017 |
% Growth
(₹ terms) |
| ₹ million |
US$ million |
₹ million |
US$ million |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| Equity Securities |
37,870 |
571 |
38,551 |
595 |
1.8 |
| Debt Securities |
0 |
0 |
0 |
0 |
0 |
| Other Foreign Assets |
178 |
3 |
149 |
2 |
-16.3 |
| Table 4: Foreign Liabilities in Units of Mutual Fund Companies at Face Value – Major Countries |
| Amount in ₹ million |
| Country |
End-March 2016 |
End-March 2017 |
% Share
in 2017 |
Annual Variation |
| Absolute |
per cent |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| United Arab Emirates |
44,319 |
48,470 |
18.0 |
4,151 |
9.4 |
| Singapore |
24,039 |
28,215 |
10.5 |
4,176 |
17.4 |
| United Kingdom |
21,654 |
25,003 |
9.3 |
3,349 |
15.5 |
| United States of America |
16,859 |
19,362 |
7.2 |
2,503 |
14.8 |
| Mauritius |
20,105 |
10,482 |
3.9 |
-9,623 |
-47.9 |
| Hong Kong |
5,802 |
6,840 |
2.5 |
1,038 |
17.9 |
| Oman |
3,084 |
4,684 |
1.7 |
1,600 |
51.9 |
| Saudi Arabia |
2,866 |
3,816 |
1.4 |
950 |
33.1 |
| Canada |
3,045 |
3,330 |
1.2 |
285 |
9.4 |
| Kenya |
3,105 |
3,161 |
1.2 |
56 |
1.8 |
| Others |
114,562 |
116,438 |
43.2 |
1,876 |
1.6 |
| Total |
259,440 |
269,801 |
100.0 |
10,361 |
4.0 |
| Table 5: Foreign Liabilities in Units of Mutual Fund Companies at Market Value – Major Countries |
| Amount in ₹ million |
| Country |
End-March 2016 |
End-March 2017 |
% Share
in 2017 |
Annual Variation |
| Absolute |
per cent |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| United Arab Emirates |
86,244 |
113,436 |
15.8 |
27,192 |
31.5 |
| Singapore |
57,964 |
72,248 |
10.1 |
14,284 |
24.6 |
| United States of America |
46,758 |
65,349 |
9.1 |
18,591 |
39.8 |
| United Kingdom |
42,785 |
57,690 |
8.0 |
14,905 |
34.8 |
| Mauritius |
53,574 |
50,409 |
7.0 |
-3,165 |
-5.9 |
| Hong Kong |
11,046 |
15,116 |
2.1 |
4,070 |
36.8 |
| Oman |
6,854 |
12,281 |
1.7 |
5,427 |
79.2 |
| Canada |
10,067 |
11,945 |
1.7 |
1,878 |
18.7 |
| Saudi Arabia |
5,951 |
9,812 |
1.4 |
3,861 |
64.9 |
| Kuwait |
4,774 |
7,519 |
1.0 |
2,745 |
57.5 |
| Others |
255,197 |
302,622 |
42.1 |
47,425 |
18.6 |
| Total |
581,214 |
718,427 |
100.0 |
137,213 |
23.6 |
| Table 6: Equity Securities held Abroad by Mutual Fund Companies – Major Countries |
| Amount in ₹ million |
| Country |
End-March 2016 |
End-March 2017 |
% Share
in 2017 |
Variation |
| Absolute |
per cent |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| United States Of America |
14,947 |
17,141 |
44.5 |
2,194 |
14.7 |
| Luxembourg |
18,545 |
16,614 |
43.1 |
-1,931 |
-10.4 |
| Cayman Islands |
871 |
947 |
2.5 |
76 |
8.7 |
| Switzerland |
608 |
674 |
1.7 |
66 |
10.9 |
| Korea, Republic of |
553 |
585 |
1.5 |
32 |
5.8 |
| Taiwan |
404 |
503 |
1.3 |
99 |
24.5 |
| Ireland |
273 |
286 |
0.7 |
13 |
4.8 |
| Brazil |
506 |
265 |
0.7 |
-241 |
-47.6 |
| Japan |
287 |
253 |
0.7 |
-34 |
-11.8 |
| United Arab Emirates |
0 |
224 |
0.6 |
--- |
--- |
| Others |
876 |
1,059 |
2.7 |
183 |
20.9 |
| Total |
37,870 |
38,551 |
100.0 |
681 |
1.8 |
| Table 7: Foreign Liabilities and Assets of Asset Management Companies |
| Item |
End-March 2016 |
End-March 2017 |
% Growth
(₹ terms) |
| ₹ million |
US$ million |
₹ million |
US$ million |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| Foreign Liabilities |
45,396 |
684 |
56,777 |
877 |
25.1 |
| Foreign Assets |
3,824 |
58 |
4,352 |
67 |
13.8 |
| Net Liabilities |
41,572 |
626 |
52,425 |
810 |
26.1 |
| Table 8: Foreign Liabilities of Asset Management Companies – Major Countries |
| Amount in ₹ million |
| |
End-March |
Variation |
| Country |
2016 |
2017 |
% Share
in 2017 |
Absolute |
per cent |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| Mauritius |
9,683 |
14,717 |
25.9 |
5,034 |
52.0 |
| United Kingdom |
11,831 |
14,000 |
24.7 |
2,169 |
18.3 |
| Japan |
7,413 |
8,114 |
14.3 |
701 |
9.5 |
| Canada |
4,068 |
4,856 |
8.6 |
788 |
19.4 |
| Hong Kong |
2,194 |
3,713 |
6.5 |
1,519 |
69.2 |
| Singapore |
3,373 |
3,176 |
5.6 |
-197 |
-5.8 |
| France |
2,334 |
2,853 |
5.0 |
519 |
22.2 |
| United States of America |
1,525 |
2,019 |
3.6 |
494 |
32.4 |
| Korea, Republic of |
1,278 |
1,399 |
2.5 |
121 |
9.5 |
| Cayman Islands |
737 |
806 |
1.4 |
69 |
9.4 |
| Netherlands |
620 |
700 |
1.2 |
80 |
12.9 |
| Others |
340 |
424 |
0.7 |
84 |
24.7 |
| Grand Total |
45,396 |
56,777 |
100 |
11,381 |
25.1 |
| Table 9: Foreign Assets of Asset Management Companies – Major Countries |
| Amount in ₹ million |
| |
End-March |
Variation |
| Country |
2016 |
2017 |
% Share in 2017 |
Absolute |
Per cent |
| (1) |
(2) |
(3) |
(4) |
(5) |
(6) |
| Guernsey |
2,426 |
2,956 |
67.9 |
530 |
21.8 |
| Singapore |
360 |
383 |
8.8 |
23 |
6.4 |
| Mauritius |
245 |
265 |
6.1 |
20 |
8.2 |
| United Arab Emirates |
52 |
46 |
1.1 |
-6 |
-11.5 |
| Sri Lanka |
4 |
4 |
0.1 |
0 |
0.0 |
| Others |
737 |
698 |
16.0 |
-39 |
-5.3 |
| Grand Total |
3,824 |
4,352 |
100.0 |
528 |
13.8 |
|
