UTI Retirement Solutions, the pension arm of UTI Asset Management Company has outshined SBI Pension Fund and Life Insurance Corporation Pension Fund in the National Pension Scheme (NPS) for government employees. Under NPS, employees have to contribute 10% of their basic salary and dearness allowance with a matching contribution from their employers. It is estimated that over 6.5 lakh central and state government employees have now joined the scheme, leading to an accumulation of nearly Rs 3,700 crore in the pension fund corpus.
According to sources from the industry, UTI Scheme-I, intended for central government employees, delivered returns of 12.16% against 11.70% and 11.88% for SBI and LIC, respectively. Since May this year, the Pension Fund Regulator Development Authority has asked companies to report all their net asset values (NAVs). According to Balram Bhagat, CEO, UTI Retirement Solutions, this performance was because of the strong credit-profile portfolio and better equity stocks selection. However Mr. Bhagat was of the opinion that the scheme has not grown as expected.
Currently, SBI has the largest share of the Rs 3,700-crore corpus, with 40%, followed by UTI with 31%, while the balance is with LIC.