SEBI Chairman cautions mutual fund players against letting debt funds bulge

Amidst the concerted efforts by the government and RBI to rein in the mounting bad loans issue, SEBI Chairman, Ajay Tyagi today cautioned mutual fund (MF) players against letting some of such money flow into the industry by way of debt funds.

Speaking at an industry summit in Mumbai today, he said Non-performing assets in the banking system should not be shifted to mutual funds by way of debt funds.

Tyagi also asked fund houses to improve the due diligence mechanism and do reduce their dependence on credit rating agencies for the same. The SEBI chief also called for consolidation saying over 40 fund houses are selling more than 2,000 products.

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