Banks rank first in terms of earning commissions from sale of mutual fund schemes. According to the recent disclosure of commission & expenses paid by several asset management companies (AMCs) to their mutual fund distributors, seven banks stand among the top-ten commission earners for mutual funds, the media reports said.
These banks include HSBC, HDFC Bank, Citibank, Standard Chartered, Axis, ICICI and Kotak Mahindra top the chart for the last financial year ended 31 March 2012, the reports added.
All these seven banks also registered an increase in the payments paid to them by AMCs for selling mutual fund schemes, despite concerns about their businesses being affected by the regulations regarding inadequate incentives for sale of mutual fund schemes.
The AMFI (Association of Mutual Funds in India) has 269 mutual fund distributors, who paid about Rs. 18.6 billion in 2011-12 as commission and expenses towards sale of MF products. These distributors registered an increase of about Rs. 1.63 billion in such payments from Rs. 16.97 billion in the previous fiscal 2010-11. The seven banks, which are part of the first 10, together paid Rs. 6.62 billion, contributing for more than one-third of the commission paid to all the distributors during 2011-12, the reports concluded.