Valley: Financial reform bill to benefit mutual funds

The Financial Sector Reform Bill now before Parliament, stands to benefit the Mutual Funds industry, according to Minister of Trade and Industry, Kenneth Valley, who recently addressed the launch of the Savinvest Asset Management Portfolio at the Hilton Hotel. Valley explained that this Bill would provide a proper regulatory and supervisory framework for the industry, creating licensing arrangements, standards for corporate governance as well as disclosure and capital requirements on guarantee funds.

Additionally, he said, the legislation would define the role played by the Central Bank and the Securities and Exchange Commission (SEC) in the regulation of the industry, bringing the operations of the UTC under the ambit of mutual funds legislation. Valley revealed that Government was currently considering the formation of a single regulatory structure for the financial sector, which would have authority over the mutual funds industry. There are currently six main players in the mutual funds market, making Savinvest the seventh. At last week’s launch, managers of the Savinvest Asset Management Portfolio, Bourse Securities Limited, introduced two Mutual Fund programmes, a Wealth Management Programme for investors, an Individual Retirement plan and a Group Employer Retirement Fund, all of which are included in the Savinvest Portfolio.

Subhas Ramkhelawan, Managing Director of Bourse Securities Limited, explained that the Savinvest Portfolio, which has been in the making for over two years, defines the company’s mandate to deliver superior investment returns and quality customer service. He said, “When a small player comes into the market to deliver that player must deliver excellence. “A small player does not have the latitude of being a half-based deliverer of any goods or service nor the good will of a long standing reputation such as some of the long standing banks.”

Last April Savinvest launched its two mutual funds, the Savinvest Capital Growth Fund  and the Savinvest Structured Investment Fund, both of which have outperformed their competitors. Ramkhelawan explained that for the year ended December 31, 2003, the Savinvest Capital Growth Fund generated a return of 57 percent, while the Savinvest Structured Investment Fund, which was designed to compete with other Money Market funds on the market, commenced providing returns of seven percent and is today providing returns of 6.75 percent which is higher than the rest of the market.