Markets regulator SEBI has issued a show cause notice to HDFC Mutual Fund managing director Milind Barve for the fund house’s decision to extend the tenure of some of its fixed maturity plans (FMPs) in the light of Zee group’s decision to delay repayments for some of its bonds.
HDFC MF, which had exposure to Zee group’s debt papers in early April, told investors in some of its FMPs that it was extending the date of redemption by a little over a year, to April 29, 2020. SEBI on 31st May issued two additional show cause notices initiating adjudication proceedings against HDFC Trustee Company, the trustee of the fund house, and its MD and some officials of the company in relation to some of its FMPs which had exposure to Zee group’s debt instruments. SEBI had issued similar show cause notices to Kotak MF and HDFC MF in the second week of May for the same reason.