PATTERN OF INVESTMENT BY NON-GOVERNMENT PROVIDENT FUNDS, SUPERANNUATION FUNDS AND GRATUITY FUNDS AMENDEND

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The Government has amended the guidelines regarding the pattern of investment to be followed by Non-Government Provident Funds, Superannuation Funds and Gratuity Funds. Short duration term deposit receipts issued by Public Sector Banks has been added as an eligible instrument for investment for incremental accretions. The percentage amount to be invested in bonds/securities of Public Financial Institutions, Public Sector Companies including Public Sector Banks has been reduced from the existing 40% to 30%. However, more flexibility has been given to Trustees as in the residual category, the percentage to be invested has been increased from 20% to 30%. Further, in case any instruments mentioned in the investment pattern being rated and their rating falling below investment grade and the same rating being confirmed by two credit rating agencies, then the option of exit can be exercised.