ICB Mutual Fund
Introduction
It is a recognized principle that diversification of investment reduces risk. An individual may not have the time, expertise and resources to undertake such diversification. Here arises the advantage of a Mutual Fund. Mutual Funds pool the savings of a great number of investors and make investments in a wide array of securities. In Bangladesh ICB has pioneered Mutual Funds for the sake of investors and of the capital market.
ICB Mutual Funds
Mutual Funds are also known as close ended Mutual Funds. The issued capital of a Mutual Fund is limited, that is, a Mutual Fund offers a limited number of certificates for sale to the public. The amount of capital and the number of certificates of each Mutual Fund remains unchanged. ICB Mutual Funds are independent of one another. A Mutual Fund being listed is traded on the Stock Exchanges. Price of Mutual Fund certificates after IPO is determined on the Stock Exchanges through interaction of supply and demand. The market price of a Mutual Fund certificates is available in Stock exchange quotations and in newspapers.
How to Buy existing Mutual Funds
An investor can purchase any of the existing eight ICB Mutual Funds certificates through the Stock Exchanges at the prevailing Market Price. However, if an investor buys Mutual Fund certificates through the Stock Exchanges he/she must be careful to submit the certificates along with duly filled-in transfer deed at ICB Head Office to ensure that the certificates are registered in his/her name.
Management of the Funds
The Mutual Funds are managed by ICB as fund manager for which receives commission @1% .
Assets of ICB Mutual Funds
ICB Mutual Funds Certificates holders shall have unfettered ownership in the assets of the Fund to which they are related. In case of winding up of the Corporation the assets belonging to any ICB Mutual Fund shall not be treated as the assets of the Corporation.
Management Fee, Charge etc.
At present management fee @ 1% on the paid up capital of the Fund is charged annually. No amount is charged on account of custodial and trust services. Part of operating expenses are charged to the respective Mutual Funds on pro rata basis.
Declaration of Dividend
The net income received on investments of Funds on account of dividend, bonus, interest, capital gain etc. are distributed amongst the Certificate Holders as per decision of the Board of Directors of ICB. Board declares such income in the form of dividend at the end of July each year. Dividends declared by ICB in the past on the Mutual Funds were very attractive. The year-wise per certificate dividend performance of the Funds is given below.
Rate of the Dividend per Certificate (Taka)
FY |
ICB Mutual Funds
|
1 st |
2 nd |
3 rd |
4 th |
5 th |
6 th |
7 th |
8 th |
1980-1981 |
20 |
|
|
|
|
|
|
|
1981-1982 |
20 |
|
|
|
|
|
|
|
1982-1983 |
20 |
|
|
|
|
|
|
|
1983-1984 |
25 |
|
|
|
|
|
|
|
1984-1985 |
35 |
21 |
|
|
|
|
|
|
1985-1986 |
38 |
23 |
21 |
|
|
|
|
|
1986-1987 |
41 |
25.5 |
22.5 |
21.5 |
|
|
|
|
1987-1988 |
48 |
28 |
25.5 |
23 |
|
|
|
|
1988-1989 |
49 |
29 |
26 |
23.5 |
20.5 |
15.5 |
|
|
1989-1990 |
49 |
29 |
26 |
23.5 |
20.5 |
13.25 |
|
|
1990-1991 |
35 |
22 |
19 |
17 |
10 |
6 |
|
|
1991-1992 |
31 |
22 |
19 |
18 |
11 |
6 |
|
|
1992-1993 |
31.5 |
21 |
18 |
17 |
12 |
- |
|
|
1993-1994 |
45 |
27 |
22 |
40 |
25 |
16 |
|
|
1994-1995 |
50 |
40 |
27 |
41 |
28 |
18 |
|
|
1995-1996 |
60 |
42 |
28 |
41 |
30 |
20 |
18 |
|
1996-1997 |
70 |
45 |
38 |
45 |
35 |
24 |
21 |
18 |
1997-1998 |
70 |
30 |
35 |
32 |
22 |
18 |
14 |
12 |
1998-1999 |
100 |
32 |
38 |
35 |
20 |
15 |
13 |
12 |
1999-2000 |
125 |
35 |
40 |
36 |
21 |
16 |
13.5 |
12.5 |
2000-2001 |
170 |
40 |
45 |
38 |
23 |
17 |
14 |
13 |
2001-2002 |
175 |
42 |
50 |
40 |
24 |
17.50 |
14.50 |
13.50 |
2002-2003 |
180 |
45 |
50 |
40 |
24 |
17.50 |
14.50 |
13.50 |
2003-2004 |
200 |
50 |
50 |
45 |
24 |
17.50 |
15 |
14 |
2004-2005 |
210 |
55 |
52 |
48 |
27 |
18.50 |
16 |
15 |
2005-2006 |
210 |
55 |
52 |
48 |
27 |
18.50 |
16 |
15 |
2006-2007 |
190(1B:2,240) |
62 |
56 |
52 |
33 |
23 |
22.50 |
18 |
2007-2008 |
265 |
75 |
65 |
60 |
45 |
30 |
30 |
25 |
2008-2009 |
310 |
95 |
85 |
80 |
56 |
37 |
35 |
32 |
2009-2010 |
400 |
200 |
140 |
125 |
100 |
75 |
70 |
65 |
2010-2011 |
500 |
250 |
185 |
165 |
135 |
90 |
95 |
90 |
2011-2012 |
600 |
300 |
200 |
185 |
170 |
100 |
110 |
100 |
2012-2013 |
700 |
375 |
240 |
240 |
200 |
105 |
120 |
110 |
Tax Concessions
(a) Investment in Certificates provides the same tax exemptions as an investment qualifying under Section 44 of the Income Tax Ordinance, 1984.
(b) Capital gains received on investment in the Fund Certificates shall not be included in the total income of a Certificate holder within the limits specified in the Income Tax Ordinance, 1984.
(c) Dividends received on investment in the Fund will be treated as dividend income under Income Tax Act, and will be exempted from tax with the limits specified in the Act.
(d) The Fund incomes are to be exempted from all taxes as granted by the Government as per SRO No 80-L/80 dated April, 1980.
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