JAKARTA (TheInsiderStories) – Indonesian Financial Services Authority (FSA) ordered the termination of seven MNC Asset Management mutual funds sales valued at Rp1.22 trillion (US$87.14 million) as considered to violate the provisions of its investment portfolio placement.
Based on FSA’s letter numbered S-1542/PM.21/2019 quoted on Friday (12/20), it was stated that the seven managed products of MNC Group‘s investment managers owned by tycoon Hary Tanoesoedibjo were suspended until purchase orders were fulfilled.
The letter stated there were three violations found in the investment management company that owned the mutual fund valued at Rp6.01 trillion. First, portfolio ownership is more than 10 percent of the net asset value (NAV, managed funds) for conventional mutual funds and more than 20 percent for sharia mutual funds.
The portfolios that exceed the provisions include Food TPS Bonds (AISA) II/2017 amounting to 23.05 percent in RD Syariah MNC Syariah Funds, PT MNC Land Tbk (IDX: KPIG) shares of 21.42 percent in RD Syariah MNC Dana Syariah Ekuitas II, and Bonds Sewatama Resource I/2012/B of 18.97 percent in RD MNC combined funds.
Then, PT Ayana Land International Tbk (IDX: NASA) shares of 16.43 percent in RD MNC combined funds, money market securities PT Bank MNC International Tbk (IDX: BABP) KC Kebon Sirih Branch of 14.89 percent in RD MNC Smart Equity Funds, and Bonds PT Global Mediacom Tbk (IDX: BMTR) Sustainable I/Phase I/2017/A of 12.59 percent in RD MNC Liquid Funds.
Second, there is a violation of affiliated securities with a portion of more than 20 percent of NAV on several mutual funds managed by the company. Products with an affiliate portion exceeding the provisions are RD MNC Equity Fund with a portion of 29.31 percent, RD MNC Combination Fund of 30.09 percent, RD Syariah MNC Dana Syariah Equity II of 21.42 percent, and RD Syariah MNC Syariah Fund of 28.43 percent.
Third, investment placement in debt securities that have defaulted. Some of the bonds are Bonds Sewatama Resource I/2011/B bonds in three mutual funds, Food TPS Bonds I/2013 bonds in two mutual funds, Bonds Sewatama Resource I/2012 Sukuk Ijarah in two mutual funds and Food TPS Bonds II/2016 Sukuk Ijarah in two mutual funds.
The FSA conveyed that it had submitted orders to take certain actions in October 2017 and in February 2018. For this reason, it delivered several orders to the company led by Freri Kojongian to adjust the portfolio in accordance with POJK No.23/POJK.04/2016 concerning Mutual Funds in the Form of Collective Investment Contracts.
This policy was carried out because the finance authorities were serious in following up on cleaning the financial ecosystem to make it more credible.
The seven products that are temporarily suspended for purchase in accordance with FSA regulations include MNC Fixed Income Fund III, MNC Sharia Equity Fund II, MNC Current Fund, MNC Liquid Funds, MNC Combination Funds, MNC Sharia Funds, and MNC Equity Fund
Including the seven products, at least MNC Asset Management manages 56 mutual funds and does not rule out the possibility of the company also managing customer funds through individual customer fund management contracts.
The FSA data shows MNC Asset Management is owned by PT Bhakti Capital Indonesia – now PT MNC Capital Tbk (IDX: BCAP) with a share of 99 percent, and Employee Cooperative of PT Bhakti Investama Tbk – now named PT MNC Investama Tbk (IDX: BHIT) with ownership portion 0, 01 percent.
Written by Lexy Nantu, Email: firstname.lastname@example.org