One wound-up Franklin scheme ‘erroneously’ sold ICICI debt

The fund house said it has compensated the scheme for the erroneous trade.

Mumbai: Franklin Templeton Mutual Fund ‘erroneously’ sold debt securities of ICICI Bank held by one of the six debt schemes after their winding up on April 23. This was revealed by the fund house in its response to a query by an investor. ET has reviewed a copy of the fund house’s reply.

Franklin Templeton in its reply said that Franklin India Ultra Short Bond Fund (FIBUF), one of the scrapped schemes, inadvertently sold ICICI Bank securities maturing in March 2022 carrying 9.2% rate while selling them from other debt schemes. The fund house said it has compensated the scheme for the erroneous trade.

“Since this transaction was erroneously executed, our Board as well as our Trustees were informed and basis advice from the AMC Board and Trustees, the AMC has compensated the scheme for the difference in value of 23 and 28 April in the best interest of our investors,” Franklin Templeton told the investor. The exact value of the trade could not be ascertained.

When contacted, Franklin Templeton spokesperson confirmed selling of the security ‘9.20% ICICI Bank’ which was held in multiple debt schemes, including FIUBF.

“While exiting from this security in other schemes, an inadvertent sale transaction took place in FIUBF as well. This was identified ... and and since the transaction was erroneously executed, the AMC has compensated the scheme to ensure that no loss is suffered by the unitholders of FIUBF,” the spokesperson said in an emailed response.