Friday, 20 May, 2022
HomeEconomyKarnataka High Court stops Franklin Templeton debt funds closure without investor consent

Karnataka High Court stops Franklin Templeton debt funds closure without investor consent

Franklin Templeton shut six of its fixed-income and credit-risk funds run in India in April, locking in Rs 308 billion of investor monies following a liquidity crisis.

Text Size:

Bengaluru: A southern Indian court has restrained Franklin Templeton Mutual Fund from winding up some of its debt funds without obtaining the consent of investors.

The board of the mutual fund cannot implement the “decision to wind up” as they are bound to obtain consent of the unit holders, said advocate Abhinav Shrivastava, a partner at law firm GSL Chambers, which represented one of the investors, citing the Karnataka High Court orders. “There is restraint on the trustees and the asset management company from taking any further steps.”

Franklin shut six of its fixed-income and credit-risk funds run by its Indian unit in April, locking in 308 billion rupees ($4.2 billion) of investor monies, after a liquidity crisis compelled the firm to freeze investor withdrawals in the South Asian nation.

“We are considering the order and will take appropriate steps in consultation with our legal experts in the best interest of the unit holders,” Franklin Templeton’s spokesperson said. – Bloomberg


Also read: Mutual funds cut investments in shadow bank debt by half, shows SEBI data


 

Subscribe to our channels on YouTube & Telegram

Why news media is in crisis & How you can fix it

India needs free, fair, non-hyphenated and questioning journalism even more as it faces multiple crises.

But the news media is in a crisis of its own. There have been brutal layoffs and pay-cuts. The best of journalism is shrinking, yielding to crude prime-time spectacle.

ThePrint has the finest young reporters, columnists and editors working for it. Sustaining journalism of this quality needs smart and thinking people like you to pay for it. Whether you live in India or overseas, you can do it here.

Support Our Journalism

Most Popular

×