ICICI Bank Launches Mutual Fund Sweep Account
February 25, 2002
ICICI Bank today announced the launch of 'Mutual Fund Sweep Account' - an automatic sweeping facility which allows current account holders to park their short-term surpluses into liquid mutual funds and earn higher returns. Initially, ICICI Bank current account customers will have the facility to invest their account surpluses in the liquid fund schemes of Prudential ICICI Asset Management Company and GIC Mutual Fund. ICICI Bank will continue to tie-up with other reputed liquid funds in the future to increase the options for its customers.
Said Ms Chanda Kochhar, Executive Director, ICICI Bank, "It is a unique product that merges the transaction efficiency of the banking account with the returns potential of a liquid fund and is likely to change the way mutual funds are sold and distributed."
A customer seeking the sweep account will have to specify the schemes in which he would want his surplus funds to flow in to. Then, the sweep account will automatically sweep any balance above a certain threshold amount into a liquid fund and the account would start earning the returns offered by the liquid fund. The amount swept with accrued returns can be withdrawn through the account. The customer can withdraw the money by issuing a cheque drawn on the account, or any other withdrawal facility such as ATM, e-cheques and infinity access, etc. These requests will serve as the redemption request to the funds. In effect, therefore the customer will enjoy the twin benefits of having a normal banking account and a Liquid Fund investment.
The product enhances the liquidity of a mutual funds scheme by functioning as a regular banking checking account with the returns of a liquid scheme. Besides, the customer will not have to bother with the physical process of applying and withdrawing from a liquid fund as the same activity will be performed by ICICI Bank on his behalf. The sweep facility will be available to customers regardless of their location thus providing another benefit over the physical process where instant clearing facilities are available only in the high value clearing locations.
With the introduction of the Sweep Account, ICICI Bank now has a complete suite of mutual fund offerings catering to various investor needs. The direct debit-credit facility of the Bank offers the occasional investor an opportunity to invest in a mutual fund by directly debiting their account and processing their mutual funds application offline. For customer transacting regularly with mutual funds, the bank transacts on behalf of the customer on his authorisation. With the sweep account the Bank has developed a system of mutual fund transaction that ensures the customer can benefit fully from the flexibility and options offered by an ICICI Bank account.
Except for the historical information contained herein, statements in this Release which contain words or phrases such as 'will', 'would', etc., and similar expressions or variations of such expressions may constitute 'forward-looking statements'. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to our ability to obtain statutory and regulatory approvals and to successfully implement our strategy, future levels of non-performing loans, our growth and expansion in business, the adequacy of our allowance for credit losses, technological implementation and changes, the actual growth in demand for banking products and services, investment income, cash flow projections, our exposure to market risks as well as other risks detailed in the reports filed by us with the United States Securities and Exchange Commission. ICICI Bank undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof.
For further press queries please contact:
ICICI: Mr Charudatta Deshpande
Head Corporate Communications,
Fax: 022 26531116