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Date : Sep 17, 2019
Survey of Foreign Liabilities and Assets of Mutual Fund Companies, 2018-19

Today, the Reserve Bank released the results of the 2018-19 round of the Survey of Foreign Liabilities and Assets of the Mutual Fund (MF) Companies on its website1. The survey covers 44 Indian MF companies and their Asset Management Companies (AMCs), which held/acquired foreign assets and/or liabilities during 2018-19 and/or in the preceding year (Annex and Schedule 4). Information on the stock of external assets and liabilities of AMCs were obtained from the annual return on foreign liabilities and assets.

Highlights:

I. Mutual Fund Companies:

  • Foreign liabilities of MF companies (US $ 13.5 billion) in the form of non- residents’ investments in the units substantially exceeded their foreign assets in the form of overseas equity investments (US $ 0.7 billion) in March 2019 with both foreign liabilities and foreign assets recording increases during 2018-19 (Table 1).

  • The UAE, the UK and the USA were the largest investors together accounting for one-third of the MF units held by non-residents (Table 2 and Table 3).

  • MF units held by non-residents in Mauritius and Singapore declined after the amendment of Double Taxation Avoidance Agreement (DTAA) with these countries for withdrawal of capital gains exemption in a phased manner, effective April 2017 (Table 2).

  • The USA (44.6 per cent share in total foreign assets) and Luxembourg (41.1 per cent) remained the preferred investment destinations for MF companies (Table 4).

II. Asset Management Companies:

  • Foreign liabilities of AMCs (US $ 3.3 billion) exceeded foreign assets (US $ 0.1 billion) substantially in March 2019 (Table 5).

  • Net foreign liabilities of AMCs increased by 68 per cent during the year, mainly on account of equity valuation gains after stock exchange listing (Table 5).

  • Non-residents in the UK held over half of the foreign liabilities of AMCs in March 2019; AMCs’ equity liabilities to non-residents in Japan, Mauritius and Hong Kong declined during the year due to capital repatriation and reduction in market value of their investment (Table 6).

  • Overseas assets of AMCs were largely held in Guernsey, Mauritius and Singapore (Table 7).

Ajit Prasad
Director  

Press Release : 2019-2020/719


Table 1: Mutual Fund Companies – Foreign Liabilities and Assets
Item End-March 2018 (R) End-March 2019 (P) % Growth
(₹ terms)
₹ crore US$ million ₹ crore US$ million
(1) (2) (3) (4) (5) (6)
Foreign Assets 3,434 528 4,499 650 31.0
    (a) Equity Securities 3,409 524 4,482 648 31.5
    (b) Debt Securities 0   0    
    (c) Other Foreign Assets 25 4 17 2 -32.0
           
Foreign Liabilities 85,847 13,198 93,541 13,523 9.0
    Market Value of Units 85,670 13,171 93,340 13,494 9.0
    Other Foreign Liabilities 177 27 201 29 13.6
           
Net Liabilities 82,413 12,670 89,042 12,873 8.0
Face Value of Units 31,869 4,900 35,051 5,067 10.0

Table 2: Foreign Liabilities in Units of MF Companies at Face Value - Major Countries
Amount in ₹ crore
Country End-March 2018 End-March 2019 % Share in 2019 Annual Variation
Absolute per cent
(1) (2) (3) (4) (5) (6)
United Arab Emirates 5,859 5,769 16.5 -90 -1.5
United Kingdom 3,051 3,458 9.9 407 13.3
United States of America 2,374 2,797 8.0 423 17.8
Singapore 2,499 2,084 5.9 -415 -16.6
Hong Kong 894 818 2.3 -76 -8.5
Oman 630 715 2.0 85 13.5
Mauritius 932 530 1.5 -402 -43.1
Qatar 319 526 1.5 207 64.9
Saudi Arabia 464 504 1.4 40 8.6
Kuwait 376 470 1.3 94 25.0
Others* 14,473 17,381 49.6 2,908 20.1
Of which: India 8,366 10,432 29.8 2,066 24.7
Total 31,869 35,051 100.0 3,182 10.0
*Others (comprised 241 countries) includes non-resident Indians (NRIs), who use their Indian permanent address.

Table 3: Foreign Liabilities in Units of MF Companies at Market Value – Major Countries
Amount in ₹ crore
Country End-March 2018 End-March 2019 % Share in 2019 Annual Variation
Absolute per cent
(1) (2) (3) (4) (5) (6)
United Arab Emirates 14,315 14,979 16.0 664 4.6
United States of America 7,704 8,989 9.6 1,285 16.7
United Kingdom 7,072 7,751 8.3 679 9.6
Singapore 6,897 5,683 6.1 -1,214 -17.6
Mauritius 5,649 3,831 4.1 -1,818 -32.2
Oman 1,679 1,898 2.0 219 13.0
Hong Kong 1,836 1,839 2.0 3 0.2
Qatar 827 1,431 1.5 604 73.0
Saudi Arabia 1,229 1,331 1.4 102 8.3
Kuwait 1,070 1,316 1.4 246 23.0
Others* 37,391 44,292 47.5 6,901 18.5
Of which: India 21,472 26,840 28.8 5,368 25.0
Total 85,670 93,340 100.0 7,670 9.0
*Others (comprised 241 countries) includes non-resident Indians (NRIs), who use their Indian permanent address.

Table 4: Equity Securities held Abroad by Mutual Fund Companies – Major Countries
Amount in ₹ crore
Country End-March 2018 End-March 2019 % Share in 2019 Variation
Absolute per cent
(1) (2) (3) (4) (5) (6)
United States of America 1,191 1,997 44.6 806 67.7
Luxembourg 1,431 1,840 41.1 409 28.6
Cayman Islands 151 112 2.5 -39 -25.8
Japan 64 104 2.3 40 62.5
Taiwan 37 54 1.2 17 45.9
Switzerland 67 54 1.2 -13 -19.4
Ireland 30 43 1.0 13 43.3
Bermuda 0 41 0.9 41 0.0
Korea, Republic of 63 34 0.8 -29 -46.0
China 0 31 0.7 31 0.0
Others 374 172 3.8 -202 -54.0
Total 3,409 4,482 100.0 1,073 31.5

Table 5: Foreign Liabilities and Assets of Asset Management Companies
Item End-March 2018 (R) End-March 2019 (P) % Growth
(₹ terms)
₹ crore US$ million ₹ crore US$ million
Foreign Liabilities* 13,931 2,142 22,979 3,322 64.9
    (a) Equity and other capital 13,418 2,063 21,142 3,056 57.6
    (b) Portfolio investment 506 78 1,833 265 262.3
    (c) Other Investment 7 - 4 - -42.9
           
Foreign Assets 615 95 631 91 2.6
    (a) Equity and other capital 590 91 599 87 1.5
    (b) Portfolio investment - - - - -
    (c) Other Investment 25 4 32 5 28.0
           
Net Liabilities 13,316 2,047 22,348 3,231 67.8
Source: Annual Census on Foreign Liabilities and Assets, RBI
Note: - Nil/negligible

Table 6: Foreign Liabilities of AMCs in Equity and Other Capital – Major Countries
Amount in ₹ crore
Country End-March Variation
2018 (R) 2019 (P) % Share in 2019 Absolute per cent
United Kingdom* 1,823 11,003 52.0 9,180 503.6
Japan 6,475 5,586 26.4 -889 -13.7
Canada 1,568 1,848 8.7 280 17.9
Mauritius 2,256 1,369 6.5 -887 -39.3
France 377 506 2.4 129 34.2
Hong Kong 382 232 1.1 -150 -39.3
Korea, Republic Of 176 219 1.0 43 24.4
Singapore 178 186 0.9 8 4.5
United States of America 105 106 0.5 1 0.4
Netherlands 78 87 0.4 9 11.5
Total 13,418 21,142 100.0 7,724 57.6
Source: Annual Census on Foreign Liabilities and Assets, RBI
* certain shares held were listed on stock exchanges during the reference year.
Note: R: Revised; P: Provisional.

Table 7: Foreign Assets of AMCs in Equity and Other Capital – Major Countries
Amount in ₹ crore
Country End-March Variation
2018 (R) 2019 (P) % Share in 2019 Absolute per cent
Guernsey 363 368 61.4 5 1.4
Mauritius 145 137 22.9 -8 -5.5
Singapore 66 68 11.4 2 3.0
United Arab Emirates 5 6 1.0 1 20.0
United States of America 11 20 3.3 9 81.8
Total 590 599 100.0 9 1.5
Source: Annual Census on Foreign Liabilities and Assets, RBI
Note: R: Revised; P: Provisional

1 The results of the previous survey round for the year 2017-18 were released vide press release dated August 24, 2018.


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