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UTI to devise liquidity mechanism in 2 weeks: Vassal

Unit Trust of India will devise a mechanism within two weeks to provide liquidity to Unit-64 scheme investors, especially the small unit holders, UTI acting chairman K G Vassal said on Thursday.

"We have formed an internal group to suggest ways to provide an open window for US-64 unit holders (small investors) at the earliest and this panel will submit its report in 15 days," Vassal said in Bombay.

The group would also define what constitutes a small investor and suggest ways to provide liquidity for payments to be made on repurchases, he said.

UTI acting chief said these proposals would be placed before its board of trustees and discussed with the Union finance ministry.

There was a public outcry against UTI's decision to suspend the sales and repurchases of its Unit-64 scheme for the next six months, he said adding, Finance Minister Yashwant Sinha has also voiced his concern over this issue.

Asked about standby credit facility for UTI by public sector banks, he said, "we have talked to State Bank of India, Union Bank of India and Syndicate Bank for such facility to meet dividend payment obligations."

The trust has drawn Rs 4 billion from credit facility to keep its funds ready for dividends and payments for the schemes which would mature shortly, Vassal added.

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