DECEMBER

fiai.india

fiai-diary-dec15

FINANCIAL

INTERMEDIARIES

ASSOCIATION

OF INDIA

DECEMBER

2015


FINANCIAL

INTERMEDIARIES

ASSOCIATION

OF INDIA

DIARY

DECEMBER, 2015

FOR PRIVATE CIRCULATION

ABOUT FIAI

Financial Intermediaries Association of India (FIAI) was formed as

a financial distributors’ body to strengthen the cause,

development, education and progress of the industry. FIAI's

endeavour is to bring all the national & regional players like

National Distributors, Banks and IFA Associations on one platform

to pursue the industry development and education agenda.

WELCOME

Year 2015 was quite an epic year for the Indian

Mutual Fund Industry. The year was a historic

one for both the Mutual Fund Industry and the

Distribution business with new highs touched in

the all business parameters like positive

inflows, Assets under management and new

investors added on a continuous and

sustainable basis.

Last month we concluded the fourth phase of

Arthik Gyan as a part of the NFLAT test for the

School students. It was a super success drive

and we surpassed all previous records of the

earlier drives. This time while we conducted

trainings & mock tests on a larger scale, we

also provided technology support of the

training content & tests through tow newly

launched Mobile Apps and our website. Social

media interaction through Facebook was also

done to engage students and provide them full

awareness of the financial Industry and thus

helping them prepare well for the exams.

The ET Money Gurukul financial literacy events

where FIAI is the Alliance partner was held last

month at Benguluru. We had fresh meetings

with Finance Ministry on resolving the

Distributor commission Service Tax issue and

on the growth of the Mutual Fund Industry. We

also had meetings with the IFA Associations

last month on jointly pursuing the Industry

growth issues.

While there were some challenges in the year

gone by, we hope in the year to come by the

Industry stakeholders will join hands and solve

them together. We wish all our Industry

colleagues and friends a merry Christmas and

a very happy new year in advance!!!

Gurpreet Singh

Principal Consultant - FIAI

Some of the key objectives of FIAI are to promote and develop the

Indian financial intermediary industry on professional, healthy and

ethical lines and to enhance and maintain standards in all areas of

operations and to work towards protecting and promoting the

interests of financial intermediary and their members

THE KEY OBJECTIVES OF FIAI ARE:

INDUSTRY DEVELOPMENT:

Promotion & development of the Financial Distribution Industry on

professional, healthy and ethical lines.

INDUSTRY STANDARDS:

To ensure, promote and maintain a high professional and ethical

standards in all areas of operation of financial intermediaries and

their members and to enhance and maintain standards with a view

to protecting and promoting their interests.

SUGGESTIONS:

Engaging with and proposing suggestions & initiatives to the

industry players, associations and regulators for the growth of the

industry.

TRAINING & EDUCATION:

Sharing of knowledge and giving a forum for enlightenment &

exchange of ideas within the industry.

ENGAGING OTHER STAKEHOLDERS:

Actively engaging with certification bodies including NISM and

FPSB for distribution to agree professional standards and

accreditations for financial advisors in India and to drive its

implementation across the intermediary fraternity.

DIARY 1


TRUSTS VS WILLS

READING CORNOR

By Dileep Choksi, Chief Mentor of C.C.Chokshi

Advisors Pvt. Ltd. and CCC WillEffect Pvt. Ltd

The choice between opting between a trust and a will

is most debated. The selection in cases of larger

estates lies in a judicious combination of both. In

cases of smaller estates, the prevailing

circumstances help decide one or the other or on

both. The similarity between a trust and a will lies in

the fact that both are unilateral executions of the

owner. In the case of a will the desire of the owner of

the property takes effect on death. In the case of a

gift the intention is put to action immediately.

Disputes as to whether a deed is a gift or a will is rare

but does exist. In concluding what is best, the nature

of the estate, the relationships between the owner

and the recipients inter se have an important role to

play. This is not to undermine the significance of the

nature of the estate in question.

As illustrated above a gift is an action done and

complete and difficult to retrieve. This is unlike a

disposition by will which can be changed as unwary

as one likes under changing circumstances whether

they be family or business are major influencing

factors. This is quite apart from the fact that the

potential of the receiver to manage the inheritance is

also a determining factor - Minors, ladies, special

children are always better off under a trust for the

reason that responsibility of administration is not

pointed on them. Also the objective of allowing a set

of individuals to enjoy the fruits of property without

ownership rights is best achieved under a trust. For

all personal purposes a trust has legal ownership of

property with an attached obligation to honor the

wishes of the settlor. It is not as if a will cannot do

that but then that may require trust to be created

through wills. The preparing of a will gives comfort to

the testator that devocation of an estate can take

place as desired by the testator. In a will a

disposition made in one manner can be changed.

This is best achieved by drafting an another will

which automatically annuls the earlier.

Taxation and estate duty are also matters that lead to

formation of individuals structures such as wills and

trusts. These are complex and have to be suited to

the legislation prevailing in the relevant place.

Similar to wills, trusts could in many cases also have

trustees from other jurisdiction. Disposition to be

made specially to individuals in special

circumstances or specific geographies are best

achieved through trusts supplemented by wills. The

important objective is that the legate or the ultimate

receiver must have a good title to the property

received. Where ownership of business or large

value estate is concerned an appropriate trust could

be a good answer. If the vesting is to be postponed

to after the lifetime of the owner then a disposition by

will to a trust is also possible. Such dispositions

could place ownership in hands of professionals

(which is now becoming an accepted practice) who

can effectively administer the property and look after

the estate. Unlike in the case of a will where a

probate or a succession certificate is necessary as it

is often demanded by a successor title such

requirement is not usually necessary in case of

trusts.

The matters briefly discussed above keep in mind

the fact that matters of succession are personal and

unique and require complete compliance with laws.

The fact that some personal laws do not grant to the

ostensible owner full disposable rights of all owned

assets does add a complication at times. However, if

dispositions are to be contested then irrespective of

they being through will or trust they will always be.

Therefore, the choice is not only between a will or a

trust but on a much large canvas which covers family

governance and individual desires.

DIARY 2


ACTION AT FIAI

ARTHIK GYAN PHASE IV CONCLUDED

Arthik Gyan is the flagship Financial Literacy Drive

program of Financial Intermediaries Association of

India (FIAI) to inculcate financial literacy and spread

the cause of the financial awareness across the

country. FIAI undertook and completed a major drive

of spreading financial Literacy in the country through

its flagship program 'Arthik Gyan'. The Arthik Gyan

2015 drive ran by FIAI from October to December

was a big success. FIAI was able to meet its

objective of conducting the bigger better and more

impactful Financial Literacy campaign. In the

process, we surpassed last year's efforts by covering

more schools & cities, conducting more trainings

and involving many more volunteers.

The key highlights of this year's Drive was as follows:

Summary of Statistics: 128 schools, 135 trainings,

27 cities, 15 states covering 10000 + students

Extensive use of Technology: Specific Mobile apps

were developed and both the Apps & our Website

had all support of the training material and mock

tests

Social Media interaction: Facebook page of Arthik

Gyan generated lot of engagement with students

FIAI reached out to the schools with the help of

NCFE to provide the training for schools registered

with the NFLAT exam. Appropriate trainings were

done by well equipped professional people with

tools such as Power Point presentations, case

studies, black board, Mobile Applications, Online

Mock Test Papers, AVS and interactive mode to

ensure students get a grasp of the subject.

Appropriate Study material was left behind with them

for self study. The statistics were quite encouraging

- 128 schools, 135 trainings in 27 cities of 15 states

covering 10000 + students were provided with the

trainings by 82 FIAI member trainee volunteers. FIAI

members participating in the drive were Aditya Birla

Money Mart Ltd, Axis Capital, Bajaj Capital Ltd, IFAN

Finserv Pvt Ltd, Karvy Stock Broking Ltd, NJ India

Invest Pvt Ltd and Standard Chartered Bank.

Members

Aditya Birla

Axis Capital

Bajaj Capital

IFAN

Karvy

NJ

SC

Grand Total

No. of

Training

35

13

8

6

29

18

26

135

No. of

Schools

35

11

7

6

26

18

25

128

No. of

unique

Cities

16

4

5

3

6

14

12

60

No. of

students

Covered

2421

819

692

307

3078

1452

2181

10950

No. of

trainers

21

5

6

5

19

15

11

82

DIARY 3


ET MONEY GURUKUL EVENT HELD IN BENGULURU

More than 100 participants benefited from ET Edge’s

Money Gurukul Summit, held at The Grand Magrath

Hotel in Bangalore, on Nov 26, 2015. Speakers like

Sabyasachi Mukherjee (Head of Personal

Investment Consulting, IIFL), Nayan Mehta (Chief

Financial officer of BSE ltd.), Ajay Mittal (Senior Chief

Manager, Birla Sun Life), Bandam Srinivas (Assistant

Vice President, NSDL Chennai office) and Gaurav

Mashruwala (Financial Planning Professional) came

together to provide understanding and insights on

the basics of finance, myths which surround financial

planning and the various available tools of

investment. Money Gurukul Summits are Financial

Literacy Summits structured by Economic Times and

alliance partner FIAI . Summits are being held in 12

cities across the country. The first summit at Mumbai

was held on Oct 15, 2015. Subsequently, Money

Gurukul events were also held at Chennai and

Kolkata last month. The next summit is in Jaipur on

Dec 17, followed by Hyderabad, Cochin, Gurgaon,

Delhi, Ahmedabad, Surat , Pune.

3RD ANNUAL WEALTH MANAGEMENT CONVENTION, 2015 OF AAFM

ITC Maratha Mumbai, Dec 19, 2015

Wealth Management For Masses – The New

Paradigm

The Year 2015 has seen a lot of hopes, many

opportunities, continuing threats and yet improving

economy coupled with great volatility across the

globe. While country grows by leaps and bounds,

Financial Services Industry must also keep the pace

with it and help the people sustain their economic

rise. AAFM's Premiere Wealth Management

Convention, 2015 is themed around this need of the

Market aimed at reaching out Wealth Management

to the Masses to equip people with connections,

learning & inspirations. FIAI is the Distribution

Partner to the Event.

SERVICE TAX ISSUE MEETING WITH FINANCE MINISTRY

FIAI has another follow up meeting with Finance Ministry on the issue of Service Tax on MF Distributor

commissions

INDUSTRY GROWTH MEETING WITH FINANCE MINISTRY

We met with senior people in Finance Ministry on discussing the MF Industry growth agenda

DIARY 4


INDUSTRY UPDATES

KEY DEBT MARKET INDICATORS DATA FOR MONTH: DECEMBER 2015

Benchmarks

As on

30-Nov-15

As on

31-Oct-15

As on

31-Aug-15

Change

(Month)

Change

(Quarter)

364 Day Tbill

91 Day Tbill

10-year Benchmark (7.72% 2025)

3 Months Certificate Of Deposit (CD)

3 Months Commercial Paper (CP)

AAA Corp Yields - 1 Yr

AAA Corp Yields - 3 Yrs

Bank Rate

RBI LAF-Repo rate

RBI LAF-Reverse Repo rate

Foreign Exchange Reserve($ bn)

Brent Crude Oil ($/bbl)

Gold ($/oz)

US Fed Funds Rate

US 10-yr Gilt

CRR

7.18%

7.13%

7.79%

7.30%

7.68%

8.30%

8.38%

7.75%

6.75%

5.75%

351.61

43.05

1061.90

0.25%

2.20%

4.00%

7.18%

7.08%

7.64%

7.27%

7.68%

8.20%

8.25%

7.75%

6.75%

5.75%

353.64

46.75

1142.35

0.25%

2.15%

4.00%

7.54%

7.40%

7.78%

7.48%

7.77%

8.40%

8.50%

8.25%

7.25%

6.25%

351.92

48.32

1135.00

0.25%

2.22%

4.00%

0.00%

0.05%

0.15%

0.03%

0.00%

0.10%

0.13%

0.00%

0.00%

0.00%

-2.03

-3.70

-80.45

0.00%

0.05%

0.00%

-0.36%

-0.27%

0.01%

-0.18%

-0.09%

-0.10%

-0.12%

-0.50%

-0.50%

-0.50%

-0.31

-5.27

-73.10

0.00%

-0.02%

0.00%

DOMESTIC MARKETS - KEY INDICES % Returns as on 30th November, 2015.

Indices

S&P BSE Sensex

NIFTY 50

S&P BSE 100

S&P BSE 200

NIFTY 500

NIFTY MIDCAP 100

S&P BSE Small Cap

S&P BSE Midcap

NIFTY NEXT 50

Close

26145.67

7935.25

8082.02

3365.29

6686.10

13248.70

11636.49

10989.76

19616.70

1 Month

-1.92

-1.62

-1.37

-1.14

-0.96

0.08

2.84

0.14

-0.59

3 Month

-0.52

-0.45

-0.48

-0.09

0.25

1.45

6.06

2.38

-2.38

1 Years

-8.88

-7.60

-6.51

-4.13

-3.35

6.94

3.24

7.00

5.65

3 Years

10.57

10.51

11.00

12.09

12.67

17.63

16.10

18.55

18.49

Source: Various (BSE, NSE, SEBI)

5 Years

5.66

5.89

5.89

6.14

6.52

7.73

5.35

9.23

9.19

10 Years

11.30

11.39

11.38

11.47

11.05

13.01

9.31

14.65

13.84

Source: BSE & NSE. Returns are calculated on absolute basis for less than one year and on CAGR basis for one year or more.

DOMESTIC MARKETS - KEY SECTORAL INDICES % Returns as on 30th November, 2015.

Indices

S&P BSE Auto

S&P BSE Bankex

S&P BSE FMCG

S&P BSE Healthcare

S&P BSE Metal

S&P BSE Oil & Gas

S&P BSE Realty

S&P BSE TECk

NIFTY INDIA CONSUMPTION

NIFTY INFRA

NIFTY MEDIA

NIFTY DIVIDEND OPPT 50

Close

18964.36

19916.30

7912.00

16298.41

7118.40

9328.39

1343.89

5942.80

3546.85

2771.40

2432.70

1904.40

1 Months

4.39

0.72

0.83

-9.79

-2.59

2.90

-2.02

-2.82

1.82

-2.20

1.14

0.76

3 Months

6.15

1.42

1.59

-9.26

-4.40

5.07

6.60

-2.52

3.58

-6.14

4.48

0.59

1 Year

-1.33

-6.11

2.31

8.97

-37.04

-14.53

-20.15

-3.50

3.79

-14.72

4.62

-13.19

3 Years

20.59

12.60

9.90

26.95

-11.74

4.17

-12.39

18.99

15.17

1.77

13.07

4.33

5 Years

13.00

7.27

15.63

18.83

-15.12

-1.79

-14.93

9.80

13.51

-4.33

6.90

3.99

10 Years

16.78

15.14

16.12

17.75

1.68

8.42

NA

9.84

NA

3.60

NA

NA

Source: BSE & NSE. Returns are calculated on absolute basis for less than one year and on CAGR basis for one year or more.

*Return for CYTD (Year To Date) is calculated on absolute basis.

DIARY 5


GLOBAL MARKETS – KEY INDICES % Returns as on 30th November, 2015.

Indices

Close

1 Months

3 Months

1 Year

3 Years

5 Years

10 Years

Shanghai Composite (China)

Nikkei 225 (Japan)

Nasdaq (USA)

Dow Jones Ind Avg (USA)

All Ordinaries (Australia)

FTSE 100 (UK)

NIFTY 50

RTS Index (Russia)

Bovespa (Brazil)

3445.41

19747.47

5108.67

17719.92

5218.19

6356.09

7935.25

847.10

45120.36

1.86

3.48

1.09

0.32

-1.33

-0.08

-1.62

0.54

-1.63

7.47

4.54

6.95

7.21

-0.07

1.73

-0.45

2.72

-3.23

28.42

13.10

6.62

-0.61

-1.51

-5.45

-7.6

-13.14

-17.46

20.28

27.87

19.28

10.80

4.92

2.71

10.51

-16.16

-7.75

4.06

14.61

14.91

9.50

2.21

2.41

5.89

-12.31

-8.24

12.15

2.50

8.43

5.00

1.33

1.41

11.39

-2.34

3.23

Source: bloomberg.com. Returns are calculated on absolute basis for less than one year and on CAGR basis for one year or more.

*Return for CYTD (Year To Date) is calculated on absolute basis. Sorted on basis of 1 Year returns.

INSTITUTIONAL ACTIVITY

(Rs. Crores)

Nov-2015

01-Jan-15 To 30-Nov-15

FIIs

Mutual Funds

Debt

-3,752.28

30,838.90

Equity

-7,074.17

6,547.70

Total Debt Equity Total

-10,826.45

37,386.60

51,344.30

4,00,873.80

20,622.80

64,514.80

71,967.10

4,65,388.60

FOREX

Currency movements against INR

Source: bloomberg.com

30-Nov-15

31-Oct-15

31-Aug-15

30-Nov-14

% Change

(Month)

% Change

(Quarter)

% Change

(Year)

1 US$

1 Euro

100 Yen

1 Pound

66.67

70.68

54.41

100.37

65.27

71.67

53.92

99.93

66.48

74.50

54.75

102.31

62.03

77.16

52.45

97.36

-2.10%

1.40%

-0.90%

-0.44%

-0.28%

5.40%

0.62%

1.93%

-6.96%

9.17%

-3.60%

-3.00%

MUTUAL FUND MONTHLY DATA

Amount in Rs. Crore (Source: SEBI)

TYPE AS ON 31ST OCTOBER, 2015 FOR SEPT. 2015 MONTH (RS.CR.)

No. of

Schemes

No. of

Folios

Assets

(Rs. Cr.)

Sales

(Rs. Cr.)

Purchases

(Rs. Cr.)

Net Sales

(Rs. Cr.)

A

Income/ Debt Oriented

Schemes (i+ii+iii+iv)

1,615

76,44,574

8,71,353

8,52,588

9,79,196

1,26,608

i

Liquid/ Money Market

54

3,44,497

2,76,655

8,23,259

9,26,565

1,03,306

ii

Gilt

48

69,187

17,898

576

1,004

428

iii

Debt (other than assured return)

1,506

72,30,842

5,75,324

28,753

51,627

22,875

iv

Debt (assured return)

0

0

0

0

0

0

v

Infrastructure Development

7

48

1,476

0

0

0

B

i

Growth/ Equity Oriented

Schemes (i+ii)

462

3,41,21,188

3,96,764

7,648

13,916

6,268

ii

ELSS

55

67,47,132

40,312

295

558

263

Others

407

2,73,74,056

3,56,452

7,353

13,358

6,005

C

Balanced Schemes 26 22,52,485 37,682 651 1,405 753

D

Exchange Traded Fund (i+ii)

51

7,01,716

16,257

893

1,864

971

i

GOLD ETF

13

4,49,015

6,227

68

0

68

ii

Other ETFs

38

2,52,701

10,031

825

1,864

1,039

E

Fund of Funds Investing Overseas

31

1,33,961

2,108

62

26

36

Total (A+B+C+D+E)

2,185

4,48,53,924

13,24,165

8,61,842

9,96,407

1,34,565

Source: SEBI

DIARY 6


BECOME A FIAI MEMBER

FIAI invites all National Distributors, Banks and

IFA Associations to become its members to be

able to successfully pursue the objectives of the

body in interest of the entire industry & distributors

at national level.

Membership Benefits

FIAI provides an excellent opportunity to

participate in the process of building a think tank

that puts forth well-researched and independent

points of view on topic relevant to the financial

products distribution / advisory practice.

Members will be able to suggest and participate in

building of the research subjects and the

underlying reports.

Members will get access to the updates of

regulatory and business changes.

The FIAI members will be privy to our reports

immediately prior to submission with regulatory

bodies.

Members will have the opportunity to engage with

eminent people and organisations through a range

of events.

Members will be able to reach remote areas by the

use of the planned FIAI regional/ zonal offices.

FIAI will undertake services for promotion of

financial business of its members and the

development of the securities market.

FIAI will undertake studies /surveys on important

matters and access to such report will be helpful

for the business practices of its members.

Registration Process

To become a member, kindly contact us...

CONTACT FIAI

Communicaton Address: #2004, The HUB, Tower

2A, 10th Floor, One Indiabulls Centre, 841 S. B. Marg,

Elphinstone (W), Mumbai - 400 013

Registered office: Navjivan Society, Office No. 1209,

Building No. 3, Lamington Road, Mumbai - 400 008.

Website: www.fiai-india.org

Suggestions & feedback: Email: info@fiai-india.org

DIARY 7


Members

Financial Intermediaries Association of India

MEMBERS

IFAN Finserv Private Limited

Here for good

Communicaton Address: #2004, The HUB, Tower 2A, 10th Floor, One Indiabulls Centre, 841 S. B. Marg, Elphinstone (W), Mumbai - 400 013

Registered Office: Navjivan Society, Office No. 1209, Building No.3, Lamington Road, Mumbai - 400 008.

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