MUMBAI: Leo Puri on Wednesday became the first non-IAS officer to lead UTI Mutual Fund, which has been headless since February 2011 after the then chief UK Sinha moved out to head market regulator Sebi. Puri's appointment also marks a break from convention as the board and the shareholders of the fifth largest fund house, in which the government is the largest shareholder, agreed to split the post of chairman and managing director.
The appointment came after the approval of shareholders who met on Wednesday, a company statement said. The government holds its stake in UTI through the State Bank of India, Punjab National BankBSE -1.53 %,Bank of BarodaBSE 0.43 % and Life Insurance Corporation which hold 18.5% each, while US investment manager T Rowe Price owns 26%.
Puri had earlier reportedly failed to make it to the list after public shareholders said that his qualifications did not meet the conditions mentioned in the advertisement put out by the fund house.
After being rudderless for 28 months, Puri's appointment is likely to provide the much-needed impetus to the public sector fund house in a highly competitive environment. Puri holds a double Masters from Oxford and Cambridge and has over three decades of experience in the financial services space. He joins UTI from McKinsey where he was director and senior advisor.
Prior to his stint at the firm, he was the managing director with the private equity firmWarburg Pincus. UTI Mutual Fund is one of the largest mutual funds in the country with assets under management of Rs 74,706 crore and has nearly 1 crore investor accounts, under its 88 domestic schemes as of end June.
Last month, the UTI board had reportedly agreed to a proposal to split the CMD's post and decided to bring in an outsider as the MD and a public sector veteran as the chairman. Puri's appointment was, in fact, cleared by the main shareholders last month but it was not sure whether he would take up the post of MD alone, as the initial proposal was to make him the CMD.
A formal announcement was held back, according to sources, due to the differences between shareholders and trustees over the profile of the new head. Its single largest foreign shareholder T Rowe Price has been pushing for a professional to head the company since February 17, 2011, when the then chairman and managing director UK Sinha resigned to join markets watchdog Sebi as its chairman.
Reportedly, the US firm was supporting Puri's candidature for the top post at UTI from the beginning. Since Sinha's departure, there have been many attempts getting a new CMD but to no avail.