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					                                                                                                    OFFER DOCUMENT



                                                                         SBI MUTUAL FUND
                                                                      INVITES SUBSCRIPTIONS TO




                                                             MAGNUM LIQUIBOND INCOME FUND


                                                                              An Open-ended Debt Scheme




                                                               Issue of Magnums of face value of Rs. 10 /- each
                                                                  on an ongoing basis at NAV related prices.




                                                             APPLICATION FORMS ARE AVAILABLE WITH SBIMF AGENTS,
                                                             STOCK EXCHANGE BROKERS, AUTHORIZED BRANCHES OF
                                                             SBI AND SBIMF INVESTOR SERVICE CENTRES & SBIMF
                                                             CORPORATE OFFICE AND ARE AVAILABLE FOR DOWNLOAD
                                                             AT www.sbimf.com

                                                            “This offer document sets forth information about the scheme that
                                                            a prospective investor ought to know before investing. The scheme
                                                            particulars have been prepared in accordance with the Securities
                                                            and Exchange Board of India (Mutual Funds) Regulations, 1996, as
                                                            amended till date, and filed with SEBI. The units being offered for
                                                            public subscription have not been approved or disapproved by
                                                            the SEBI nor has the SEBI certified the accuracy or adequacy of the
                                                            offer document. The investors are required to read the terms of
                                                            offer carefully before investing. The offer document should be
                                                            retained by the investors for future reference. The offer document
                                                            shall remain effective till a material change (other than a change in
                                                            the fundamental attributes and within the purview of the offer
                                                            document) occurs and thereafter the changes shall be filed with
            Principal Trustee : State Bank of India,        SEBI and circulated to the Magnumholders.”
Assets Management Company : SBI Funds Management Limited,
     191, Maker Tower “E”, Cuffe Parade, Mumbai 400 005
                        www.sbimf.com
MAGNUM LIQUIBOND INCOME FUND

                                                                      I. CONTENTS

 I.      CONTENTS ----------------------------------------------------------------------------------------------------------------------------------   2


 II.     DEFINITIONS AND EXPLANATIONS OF TERMS USED -------------------------------------------------------------------------                          3


 III.    HIGHLIGHTS OF THE SCHEME --------------------------------------------------------------------------------------------------- -----            4


 IV.     RISK FACTORS ------------------------------------------------------------------------------------------------------------------------------   4


 V.      DUE DILIGENCE CERTIFICATE --------------------------------------------------------------------------------------------------------            5


 VI.     EXPENSES ----------------------------------------------------------------------------------------------------------------------------------   5


 VII.    CONDENSED FINANCIAL INFORMATION ------------------------------------------------------------------------------------------                    7


 VIII.   CONSTITUTION OF THE MUTUAL FUND ------------------------------------------------------------------------------------------                    12


 IX.     INVESTMENT OBJECTIVES & POLICIES --------------------------------------------------------------------------------------------                 15


 X.      MANAGEMENT OF THE FUND ------------------------------------------------------------------------------------------------------- -              20


 XI.     UNITS AND OFFER ------------------------------------------------------------------------------------------------------------------------      23


 XII.    SALE OF UNITS -------------------------------------------------------------------------------------------------------------- --------------   24


 XIII.   DIVIDEND AND DISTRIBUTIONS ------------------------------------------------------------------------------------------------ -----             25


 XIV.    INTER-SCHEME TRANSFERS ----------------------------------------------------------------------------------------------------------             26


 XV.     ASSOCIATE TRANSACTIONS ----------------------------------------------------------------------------------------------------------             26


 XVI.    BORROWING BY THE MUTUAL FUND ----------------------------------------------------------------------------------------------                   27


 XVII. NAV AND VALUATION OF ASSETS OF THE SCHEME --------------------------------------------------------------------------                            27


 XVIII. REDEMPTION AND REPURCHASE ---------------------------------------------------------------------------------------------------                  29


 XIX.    ACCOUNTING POLICIES & STANDARDS -------------------------------------------------------------------------------------------                   30


 XX.     TAX TREATMENT OF INVESTMENTS IN MUTUAL FUNDS -------------------------------------------------------------------                              31


 XXI.    INVESTORS’ RIGHTS AND SERVICES -----------------------------------------------------------------------------------------------                32


 XXII. INVESTOR GRIEVANCES REDRESSAL MECHANISM ---------------------------------------------------------------------------                             35


 XXIII. PENDING LEGAL PROCEEDINGS AND OTHER INFORMATION --------------------------------------------------------------                                 35


                                                                                2
MAGNUM LIQUIBOND INCOME FUND
                             II. DEFINITIONS AND EXPLANATIONS OF TERMS USED
The AMC                 :   The Asset Management Company; refers to “SBI Funds Management Ltd (SBIFM)”, a wholly owned
                            subsidiary formed by State Bank of India which manages the assets of investors in various schemes of SBI
                            Mutual Fund.
AMC Fees                :   Investment management & advisory fees charged by the AMC to the scheme as disclosed in the section
                            on “Expenses” in the offer document.
The Auditors            :   The statutory auditors to the scheme whose appointment is approved by the board of trustees of SBI
                            Mutual Fund. This is disclosed under the section “Management of the Fund” in the Offer Document.
Business Day/Working    :   means (i) a day other than Saturday and Sunday, (ii) a day on which banks in Mumbai are not required or
Day                         not obligated by law or executive order to remain closed, (iii) a day on which the sale and redemption of
                            Magnums is not suspended.
The Custodians          :   The custodians to the scheme whose appointment is approved by the board of trustees of SBI Mutual
                            Fund. This is disclosed under the section “Management of the Fund” in the Offer Document.
The Date of Application :   The date of receipt of a valid application complete in all respects for issue or repurchase (depending
                            upon the context) of Magnums of the Scheme by the Registrars.
The Fund                :   SBI Mutual Fund (SBIMF); constituted as a Trust with SBI as the Principal Trustee, to mobilize savings from
                            a wide cross-section of people and to provide them attractive returns, security and liquidity through
                            investments in capital & money markets.
ISCs                    :   Investor Service Centres opened by SBI Mutual Fund at various locations in India, listed in the section
                            “Investors’ Rights & Services” in the Offer Document.
Magnum                  :   One undivided unit issued under the Scheme by SBI Mutual Fund.
Magnum Holder           :   Any eligible applicant who has been allotted and holds a valid Magnum in his/her/its name.
NAV                     :   The Net Asset Value of the Magnums of the Scheme.
NRI                     :   An Indian will be treated as a non-resident in any previous year if he fulfills any of the following two
                            conditions: (a) he/she has not resided in India in that year for period or periods amounting in all to 182
                            days or more, or (b) Having within the four years preceding that year has not resided in India for a period
                            or periods amounting in all to 365 days or more, and has not resided in India for 60 days or more in that
                            year.
NSE                     :   The National Stock Exchange, Mumbai.
The Offer               :   The issue of Magnums of the Scheme as per the terms contained in this Offer Document.
Offer Document          :   This document issued by SBI Mutual Fund, containing the terms of offering Magnums of the Scheme of
                            SBI Mutual Fund for subscription as per the terms contained herein.
The Principal Trustee   :   State Bank of India
RBI                     :   Reserve Bank of India, established under Reserve Bank of India Act, 1934.
The Registrars          :   The registrars and transfer agents to the scheme whose appointment is approved by the board of trustees
                            of SBI Mutual Fund. This is disclosed under the section “Management of the Fund” in the Offer Document.
SBI                     :   State Bank of India, having its Corporate Office at State Bank Bhavan, Madame Cama Road, Mumbai - 400
                            021. Also referred to as the Sponsor or the Settlor or the Principal Trustee.
SBIMF                   :   SBI Mutual Fund (see “the Fund”)
SBIFM                   :   SBI Funds Management Ltd. (see “the AMC”)
The Scheme              :   Magnum Liqui Bond Open Income Fund of SBI Mutual Fund.
SEBI                    :   Securities and Exchange Board of India established under Securities and Exchange Board of India Act,
                            1992.
SEBI Regulations        :   Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 for the time being in force and
                            as amended from time to time.
The Settlor             :   State Bank of India
The Sponsor             :   State Bank of India, having its Corporate Office at State Bank Bhavan, Madame Cama Road, Mumbai - 400
                            021, which has made an initial contribution of Rs. 5 lacs towards the trust fund and has appointed a Board
                            of Trustees to supervise the activities of the Fund.
Switchover              :   Simultaneous application by a Magnum holder for repurchase of Magnums under one scheme (or a plan
                            under the scheme) of SBI Mutual Fund and, through the repurchase proceeds, for the purchase of fresh/
                            additional Magnums under another scheme (or another plan under the same scheme) of SBI Mutual Fund
                            which is open for issue at the time.
The Trustees            :   The Principal Trustee, i.e., State Bank of India, and one or more member(s) of the Board of Trustees
                            appointed by SBI to supervise the activities of the Fund as disclosed in the section “Constitution of the
                            Mutual Fund” in the Offer Document.
Unit Capital            :   The aggregate face value of the Magnums issued and outstanding under the Scheme.


                                                                 3
MAGNUM LIQUIBOND INCOME FUND
                                                 III. HIGHLIGHTS OF THE SCHEME
1.    An open-ended debt scheme offering easy issue & repurchase at NAV-related prices on an ongoing basis.
2.    Following Plans are available to the investors :
      (A) Growth Plan           (B) Dividend Plan
3.    Both Plans will invest their entire corpus in high quality debt (Corporate debentures, PSU/FI/Govt guaranteed bonds), Govt securities
      and money market instruments (commercial paper, certificates of deposit, T-bills, bills rediscounting, repos, short-term bank deposits,
      etc). There shall be no investment in equity.
4.    The Growth Plan will give returns through capital gains only. No dividends shall be declared under this Plan. The Dividend Plan will
      endeavour to declare regular dividends every half year, depending on the NAV at that point of time.
5.    Minimum amount of investment is Rs.2000/- and in multiples of Rs. 500/- thereafter.
6.    Systematic Investment Facility is available to make investments at periodic intervals. This facility is available only at the Investor
      Service Centres.
7.    Systematic Withdrawal Facility to make periodic withdrawals on a monthly/quarterly basis, available. Payment will be made through
      post-dated cheques issued for 6 months/two quarters at a time.
8.    The scheme will declare NAV, Sale Price and Repurchase Price on every Business day.
9.    For investors who repurchase after 3 months of investment, the repurchase will be at NAV without any load. For repurchases within
      3 months of investment, there will be an exit load of 0.5% of NAV.
10.   Tax benefits :
      (a)    Tax benefits available to the unit holders: The tax benefits will be as per the prevailing laws:
            i.     As per section 10(33) of the Income Tax Act, income from Mutual Fund remains fully exempt from tax in the hands of
                   investors.
            ii.    Tax benefit is available under sections 48 & 112 on capital gains for resident Indians. The Magnumholders will have the
                   option to pay the long term capital gains tax @ 10% (plus applicable surcharge) without the cost inflation index benefit
                   or @ 20% (plus applicable surcharge) with the cost inflation index benefit, whichever is more beneficial.
            iii.   Magnums held under this scheme will not be liable to wealth tax and gift tax.
      (b)    Tax benefits to the Mutual Fund: The entire income of the Mutual Fund is exempt from income tax under section 10 (23D) of the
             Act. The fund will, however, have to pay tax @ 10% (plus applicable surcharge) on the dividends distributed by it.
      These tax exemptions will strictly be governed by the relevant provisions under the existing tax laws and are subject to change as and
      when relative tax laws are changed.
11.   Investors have the facility to switchover between the Plans at NAV. Also, switchover facility at the NAV related prices to other open-
      end schemes of SBI Mutual Fund is available. This facility of switchover to other schemes is not available to NRIs, FIIs, and OCBs.

                                                           IV. RISK FACTORS
1. Standard Risk Factors
a.    Mutual funds and securities investments are subject to market risks and there is no assurance or guarantee that the Fund’s objective
      will be achieved.
b.    As with any investment in securities, the NAV of the units issued under the scheme can go up or down depending on the factors and
      forces affecting the capital markets.
c.    Past performance of the Sponsor / AMC / Mutual Fund does not guarantee the future performance of the schemes of the Mutual Fund.
d.    Magnum Liqui Bond Income Fund is only the name of the scheme and does not, in any manner, indicate either the quality of the
      scheme or its future prospects and returns.
e.    State Bank of India, the sponsor , is not responsible or liable for any loss resulting from the operation of the scheme beyond the initial
      contribution made by it of an amount of Rs. 5 lacs towards setting up of the mutual fund.
2. Scheme-Specific Risk Factors
a.    Magnum LiquiBond Income Fund will be investing in debt instruments (including securitized debt), Government Securities and
      money market instruments (such as call money market, term/notice money market, repos, reverse repos and any alternative to the call
      money market as may be directed by the RBI). The liquidity of the scheme’s investments is inherently restricted by trading volumes
      and settlement periods. In the event of an inordinately large number of redemption requests, or of a restructuring of the scheme’s
      investment portfolio, these periods may become significant.
b.    Subject to necessary approvals, the Scheme may invest in overseas markets, which carry a risk on account of fluctuations in the
      foreign exchange rates.
c.    The Mutual Fund is not assuring that it will make dividend distributions on a semi annual basis. All dividend distributions are subject
      to the availability of distributable surplus.
d.    Investments under the scheme may also be subject to the following risks:
      i)     Credit risk: Credit risk is risk resulting from uncertainty in a counterparty’s ability or willingness to meet its contractual
             obligations. This risk pertains to the risk of default of payment of principal and interest. Government Securities have zero credit
             risk while other debt instruments are rated according to the issuers ability to meet the obligations.


                                                                       4
MAGNUM LIQUIBOND INCOME FUND
         ii)    Liquidity Risk pertains to how saleable a security is in the market. If a particular security does not have a market at the time of
                sale, then the scheme may have to bear an impact depending on its exposure to that particular security.
         iii)    Interest Rate risk is associated with movements in interest rate, which depend on various factors such as government borrowing,
                inflation, economic performance etc. The value of investments will appreciate/depreciate if the interest rates fall/rise.
         iv)    Derivative risks: The derivatives will entail a counter-party risk to the extent of amount that can become due from the party. The
                cost of hedge can be higher than adverse impact of market movements. An exposure to derivatives in excess of the hedging
                requirements can lead to losses. An exposure to derivatives can also limit the profits from a genuine investment transaction.
                Efficiency of a derivatives market depends on the development of a liquid and efficient market for underlying securities and
                also on the suitable and acceptable benchmarks.
         v)     Reinvestment risk: This risk arises from uncertainty in the rate at which cash flows from an investment may be reinvested. This
                is because the bond will pay coupons, which will have to be reinvested. The rate at which the coupons will be reinvested will
                depend upon prevailing market rates at the time the coupons are received.
         Investors should study the Offer Document carefully in its entirety and should not construe thereof as advise relating to legal, taxation,
         investment or any other matters. Investors are advised to consult their legal, tax, investment and other professional advisors to
         determine possible legal, tax, financial or other considerations of subscribing to or redeeming Magnums, before making a decision
         to invest/redeem Magnums.

                                                     V. DUE DILIGENCE CERTIFICATE
It is confirmed that :
I.       the draft offer document forwarded to SEBI is in accordance with the Securities and Exchange Board of India (Mutual Funds)
         Regulations, 1996, and the guidelines and directives issued by SEBI from time to time;
II.      All legal requirements connected with the launching of the scheme as also the guidelines, instructions, etc., issued by the Government
         and any other competent authority in this behalf, have been duly complied with.
III.     the disclosures made in the offer document are true, fair and adequate to enable the investors to make a well informed decision
         regarding investment in the proposed scheme;
IV.      all the intermediaries named in the offer document are registered with SEBI and till date such registration is valid.



                                                                                               Signature   :
                                                                                               Name        : Niamatullah
Place: Mumbai                                                                                                Managing Director
Date : 07.08.2001                                                                                            SBI Funds Management Limited

                                                                  VI. EXPENSES

1. Magnum holder transaction expenses or sales load :
The following table illustrates the expenses that the investors will incur on their purchases/ sales of Magnums under this scheme :
     Nature of expense                                                               % of NAV
     Maximum sales load imposed on purchases of Magnums                              Currently Nil
     Sales load if any on issue of Magnums in lieu of dividends                      Not applicable
     Contingent deferred sales load                                                  NIL
     Repurchase load
       Within 3 months of investment                                                 Currently 0.5% of NAV
       After 3 months of investment                                                  NIL
     Switchover load (not applicable for intra scheme Switchover)
      Within 3 months of investment                                                  Currently 0.5% of NAV
      After 3 months of investment                                                   NIL
The AMC reserves the right to introduce a load structure, levy a different load structure or remove the load structure for any of the Plans
within the Fund. The sales load, the repurchase load and / or the switchover load may be increased by the AMC at any time to a maximum
of 3% of NAV after giving notice to that effect to the investors through an advertisement in an English language daily that circulates all over
India as well as in a newspaper published in the language of the region where the Head Office of the mutual fund is situated. The loads will
be used for reimbursing the AMC to the extent of the marketing & selling expenses including agents’ commission, that are incurred by the
AMC and the balance, if any, will be available to the scheme for reinvestment.
In any case, should the load structure change in future, such changes in load will be applicable only to prospective investors who invest


                                                                          5
MAGNUM LIQUIBOND INCOME FUND
after the date specified in the advertisement and not to the existing investors on the amounts already invested by them. The Mutual Fund
will also endeavour to keep the investors informed through the following measures:
i)       An addendum detailing the changes will be attached to the offer documents and abridged offer documents. The addendum will also
         be available with the distributors/brokers and will also be sent alongwith the newsletter sent to the magnumholders immediately after
         the changes.
ii)      The Mutual Fund will display the changes/modifications in the offer document in the form of a notice at all ISCs and distributors/
         brokers office.
iii)     The introduction of the exit load/CDSC alongwith the details will be stamped in the acknowledgement slip issued to the investors on
         submission of the application form and will also be disclosed in the statement of accounts issued after the introduction of such load/
         CDSC.
iv)      Any other measures which the Mutual Fund considers necessary in the interest of the magnumholders.
In accordance with SEBI Regulations, the repurchase price will not be lower than 93% of the NAV and the sale price will not be higher than
107% of the NAV, and the difference between sale price and repurchase price shall not exceed 7% of the sale price.
2. Initial issue expenses:
(a) Present Scheme:
The initial issue expenses associated with the launch of this scheme was fully borne by SBI Funds Management Ltd.

(b) Other Schemes:
The initial issue expenses incurred by other schemes launched by the mutual fund is indicated in the table below:
         Scheme Name         Estimated Issue Expenses       Actual Issue Expenses                             Remarks
     Magnum Monthly 5.9% of the Initial issue Rs. 1.19 cr., i.e. 3.38% of Being a load scheme, the entire issue expense was
     Income Plan    corpus                    initial corpus              borne by the scheme.
     Magnum Gilt Fund        2.92% of the Initial issue Rs. 0.36 cr., i.e., 0.123% of The entire initial issue expenses were borne by the
                             corpus.                    initial corpus                AMC.
     Magnum Sector Funds 6% of corpus collected          Rs. 0.49 cr., i.e., 4.24% of Rs. 1.25 lac. borne by the AMC
     Umbrella                                            initial corpus
     Magnum InstaCash 6% of corpus collected             Rs. 32785, i.e. 0.01% of initial The entire initial issue expenses were borne by the
     Fund                                                corpus                           AMC.

     Magnum Monthly 6% of corpus collected               Rs. 5.33 crs., i.e. 2.88% of The entire initial issue expenses were borne by the
     Income Scheme 1998                                  corpus.                      AMC.
     (II)
3. Annual Scheme Recurring Expenses :
The following expenses will be charged to the scheme on a recurring basis :
     Category of expense                                           Ceilings as per SEBI
     Investment management & advisory fee to be                     Subject to the following ceilings :
     charged by the AMC.                                           i)  Not exceeding 1.25% of the average weekly net assets of the
                                                                        scheme outstanding in the year as long as the net assets do not
                                                                        exceed Rs. 100 crores and
                                                                   ii)   1% of the amount in excess of Rs. 100 crores where net assets
                                                                         so calculated exceed Rs. 100 crores
     Fees and expenses of Trustees                                 0.01% of the average weekly net assets, subject to a minimum of Rs. 15
                                                                   lakhs to be allocated across all schemes of the fund.
     Custodian fee                                                 On actuals, within the overall ceiling mentioned below
     Registrar Services for transfer of units sold or redeemed     On actuals, within the overall ceiling mentioned below
     Brokerage & Transaction cost                                  On actuals, within the overall ceiling mentioned below
     Audit fees                                                    On actuals, within the overall ceiling mentioned below
     Marketing & selling expenses, including agent commission, On actuals, within the overall ceiling mentioned below
     if any
     Cost of investor communication & statutory advertising        On actuals, within the overall ceiling mentioned below
     Cost of providing account statements &                        On actuals, within the overall ceiling mentioned below
     redemption warrants


                                                                         6
MAGNUM LIQUIBOND INCOME FUND
 Insurance premium paid by the fund                              On actuals, within the overall ceiling mentioned below
 Winding up costs                                                On actuals, within the overall ceiling mentioned below
 Total Expenses Charged to the scheme                            Subject to the following limits :
                                                                 i)   2.25% on the first Rs. 100 cr. of average weekly net assets.
                                                                 ii) 2.00% on the next Rs. 300 cr. of average weekly net assets
                                                                 iii) 1.75% on the next Rs. 300 cr. of the average weekly net assets
                                                                 iv) 1.50% on the balance of the average weekly net assets
The purpose of the table is to assist the investor in understanding the various costs and expenses that an investor in the scheme will bear
directly or indirectly. Any expenses incurred in excess of the above overall limits will be borne by the AMC.

                                           VII. CONDENSED FINANCIAL INFORMATION

1. Historical Per Unit Statistics
The historical per unit statistics for all the schemes launched by the Mutual Fund during the last three fiscal years is provided in the tables
below:
                                                                       Magnum Monthly Income Schemem 1998 (II)
 Particulars                                                 Monthly                 Quarterly                Annual            Cumulative
                                                              Income                  Income                  Income               Growth
                                                               Option                  Option                  Option              Option
 (Statistics for the year 1999-2000)
 NAV at the beginning of the year                                10.15                   10.36                  10.36                  10.38
 Net Income per unit (before payout)                             2.771                   2.754                  1.580                  2.950
 Dividends (Payout)                                              1.441                   1.264                  1.325                      —
 Transfer to Reserves (if any)                                      —                        —                     —                       —
 Latest NAV (as on 31.03.2000)                                  11.33                    11.49                  11.58                  12.95
 Annualized Return (%) (Since Inception)                      25.82%                   24.45%                 24.76%                 24.73%
 Net Assets at the end of the year (Rs. Cr.)                     58.04                   20.17                  93.15                  14.31
 Ratio of recurring expenses to Net Assets (%)                  1.35%                   1.35%                  1.35%                  1.35%
 (Statistics for the year 2000 – 2001)
 NAV at the beginning of the year                                11.33                   11.49                  11.58                  12.95
 Net Income per unit (before payout)                             2.841                   2.777                  3.125                  3.130
 Dividends (Payout)                                              2.311                   2.057                  1.325                      —
 Transfer to Reserves (if any)                                      —                        —                     —                       —
 Latest NAV (as on 31.03.2001)                                  10.52                    10.71                  10.81                  13.52
 Annualized Return (%) (Since Inception)                         15%                   14.46%                 14.69%                 14.91%
 Net Assets at the end of the year (Rs. Cr.)                     52.65                   18.34                  84.97                  14.51
 Ratio of recurring expenses to Net Assets (%)                  1.48%                   1.48%                  1.48%                  1.48%
 (Statistics for the year 2001 – 2002)
 NAV at the beginning of the year                                10.52                   10.71                  10.81                  13.52
 Net Income per unit (before payout)                             3.528                   3.448                  3.765                  4.160
 Dividends (Payout)                                              2.908                   2.838                  2.425                      —
 Transfer to Reserves (if any)                                      —                        —                     —                       —
 Latest NAV                                                      10.62                   10.61                  11.34                  14.16
 Annualized Return (%) (Since Inception)                      14.72 %                  14.51%                 13.99%                 14.02%
 Net Assets at the end of the year (Rs. Cr.)                     51.90                   17.64                  77.65                  15.64
 Ratio of recurring expenses to Net Assets (%)                  1.40%                   1.40%                  1.40%                  1.40%
(Date of allotment of units: 29th January 1999)
Note: The NAV for 2001-2002 is dated as on 31st July 2001 and for the other years is dated 31st March 2001. The historical per unit statistics
have been calculated upto the period ending 31st July 2001. The compounded annualized returns have been calculated since inception of
the schemes, taking adjusted NAV, i.e., after adjusting dividends paid out on initial NAV of Rs. 10/- per Magnum. * - indicates the returns
for periods less than one year are in absolute terms only and not annualized.


                                                                        7
MAGNUM LIQUIBOND INCOME FUND
 Particulars                                                                                           Magnum LiquiBond (Growth)
                                                                                         2001-2002            2000-2001          1999-2000
 NAV at the beginning of the period                                                         13.1100             11.8100               10.52
 Net income per unit                                                                          3.903               3.110               1.810
 Dividends per unit                                                                               —                   —                   —
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                               13.9034             13.1100             11.8100
 Annualized return since inception for the period                                           13.14%              12.30%              13.28%
 Net Asset at the end of the period                                                          473.09              453.59              326.46
 Ratio of Recurring expenses to Net Assets                                                   1.59%               1.54%               1.97%
                                th
 (Date of allotment of units: 30 November 1998)
 Particulars                                                                                           Magnum LiquiBond (Dividend)
                                                                                         2001-2002            2000-2001          1999-2000
 NAV at the beginning of the period                                                         10.2100             10.3400               10.52
 Net income per unit                                                                          3.034               2.505               1.635
 Dividends per unit                                                                           2.295               2.295               1.295
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                               10.7393             10.2100             10.3400
 Annualized return since inception for the period                                           11.49%              10.91%                12.54
 Net Asset at the end of the period                                                          373.52              280.35              351.59
 Ratio of Recurring expenses to Net Assets                                                   1.59%               1.54%               1.97%
                                th
 (Date of allotment of units: 30 November 1998)
 Particulars                                                                                           Magnum Growth Fund
                                                                                         2001-2002            2000-2001          1999-2000
 NAV at the beginning of the period                                                             7.94              16.36               10.00
 Net income per unit                                                                          3.605               4.065              12.485
 Dividends per unit                                                                           6.125               6.125               6.125
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                                   7.48                7.94              16.36
 Annualized return since inception for the period                                           23.09%              29.26%             124.85%
 Net Asset at the end of the period                                                          154.58              164.33              338.20
 Ratio of Recurring expenses to Net Assets                                                   0.20%               0.15%               0.41%
 (Date of allotment of units: Magnum Growth Fund – 24th May 1999)
Note: The NAV for 2001-2002 is dated as on 31st July 2001 and for the other years is dated 31st March 2001. The historical per unit statistics
have been calculated upto the period ending 31st July 2001. The compounded annualized returns have been calculated since inception of
the schemes, taking adjusted NAV, i.e., after adjusting dividends paid out on initial NAV of Rs. 10/- per Magnum. * - indicates the returns
for periods less than one year are in absolute terms only and not annualized.




                                                                      8
MAGNUM LIQUIBOND INCOME FUND
 Particulars                                                                                      Magnum InstaCash (Cash)
                                                                                         2001-2002      2000-2001         1999-2000
 NAV at the beginning of the period                                                         11.8272             10.8389               10.00
 Net income per unit                                                                          2.123               1.827               0.830
 Dividends per unit                                                                               —                   —                   —
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                               12.1231             11.8272               10.83
 Annualized return since inception for the period                                            9.24%               9.53%              8.30%*
 Net Asset at the end of the period                                                          110.99               47.47                 8.35
 Ratio of Recurring expenses to Net Assets                                                   0.86%                  0.82             0.47%
                                                              th
 (Date of allotment of units: Magnum InstaCash Fund – 28 May 1999)
 Particulars                                                                                           Magnum InstaCash (Dividend)
                                                                                         2001-2002            2000-2001          1999-2000
 NAV at the beginning of the period                                                         10.3120               11.01               10.00
 Net income per unit                                                                          1.922              1.6420               1.010
 Dividends per unit                                                                          1.6624              1.3300                   —
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                                 10.26             10.3120               11.01
 Annualized return since inception for the period                                            8.13%                  8.82           10.10%*
 Net Asset at the end of the period                                                           36.83                 5.59                0.09
 Ratio of Recurring expenses to Net Assets                                                   0.94%               1.16%               0.58%
                                                              th
 (Date of allotment of units: Magnum InstaCash Fund – 28 May 1999)
 Particulars                                                                                              MSFU (Contra)
                                                                                         2001-2002            2000-2001          1999-2000
 NAV at the beginning of the period                                                             7.88                9.45              10.00
 Net income per unit                                                                           -2.32             -2.120               -0.550
 Dividends per unit                                                                               —                   —                   —
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                                   7.68                7.88                9.45
 Annualized return since inception for the period                                          -12.35%              -13.31%            -5.50%*
 Net Asset at the end of the period                                                           10.58               10.93               10.88
 Ratio of Recurring expenses to Net Assets                                                   1.63%               1.69%               2.06%
 (Date of allotment of units: 31st July 1999)
Note: The NAV for 2001-2002 is dated as on 31st July 2001 and for the other years is dated 31st March 2001. The historical per unit statistics
have been calculated upto the period ending 31st July 2001. The compounded annualized returns have been calculated since inception of
the schemes, taking adjusted NAV, i.e., after adjusting dividends paid out on initial NAV of Rs. 10/- per Magnum. * - indicates the returns
for periods less than one year are in absolute terms only and not annualized.




                                                                      9
MAGNUM LIQUIBOND INCOME FUND
 Particulars                                                                                                 MSFU (IT)
                                                                                         2001-2002           2000-2001           1999-2000
 NAV at the beginning of the period                                                             6.99                40.2              10.00
 Net income per unit                                                                         -0.470               0.990              20.800
 Dividends per unit                                                                                4                   4                   4
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                                   5.53                6.99                40.2
 Annualized return since inception for the period                                           -3.32%               7.69%            342.00%*
 Net Asset at the end of the period                                                           48.38               65.49              234.93
 Ratio of Recurring expenses to Net Assets                                                   1.54%               1.62%               2.06%
                                st
 (Date of allotment of units: 31 July 1999)
 Particulars                                                                                           MSFU (Pharma)
                                                                                         2001-2002           2000-2001           1999-2000
 NAV at the beginning of the period                                                             8.93              10.97               10.00
 Net income per unit                                                                         -1.630               -1.070              0.970
 Dividends per unit                                                                               —                   —                   —
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                                   8.37                8.93              10.97
 Annualized return since inception for the period                                           -8.50%              -6.56%              9.70%*
 Net Asset at the end of the period                                                           20.20               21.48               19.77
 Ratio of Recurring expenses to Net Assets                                                   1.51%               1.54%               2.06%
                                st
 (Date of allotment of units: 31 July 1999)
 Particulars                                                                                             MSFU (FMCG)
                                                                                         2001-2002           2000-2001           1999-2000
 NAV at the beginning of the period                                                              6.7              10.92                   10
 Net income per unit                                                                         -4.070               -3.300              0.920
 Dividends per unit                                                                               —                   —                   —
 Transfer from Reserves                                                                           —                   —                   —
 NAV at the end of the period                                                                   5.93                 6.7              10.92
 Annualized return since inception for the period                                          -22.97%              -9.47%              9.30%*
 Net Asset at the end of the period                                                           10.53               11.87               12.65
 Ratio of Recurring expenses to Net Assets                                                   1.75%               2.49%               2.06%
                                st
 (Date of allotment of units: 31 July 1999)
Note: The NAV for 2001-2002 is dated as on 31st July 2001 and for the other years is dated 31st March 2001. The historical per unit statistics
have been calculated upto the period ending 31st July 2001. The compounded annualized returns have been calculated since inception of
the schemes, taking adjusted NAV, i.e., after adjusting dividends paid out on initial NAV of Rs. 10/- per Magnum. * - indicates the returns
for periods less than one year are in absolute terms only and not annualized.




                                                                     10
MAGNUM LIQUIBOND INCOME FUND
 Particular                                                            Magnum Gilt (ST-Div)                     Magnum Gilt (ST-Gr)
                                                                     2001-2002           2000-2001           2001-2002           2000-2001
 NAV at the beginning of the period                                     10.0649                  10             10.2785               10.00
 Net income per unit                                                       0.771              0.285               0.787               0.278
 Dividends per unit                                                         0.47                0.22                  —                   —
 Transfer from Reserves                                                       —                   —                   —                   —
 NAV at the end of the period                                           10.3014             10.0649             10.7874             10.2785
 Annualized return since inception for the period                       7.70%*              2.85%*              7.87%*              2.78%*
 Net Asset at the end of the period                                        22.21              35.13               27.78                 5.17
 Ratio of Recurring expenses to Net Assets                                1.20%                 1.13             1.20%                  1.26
 (Date of allotment of units: 23rd December 2000)
 Particulars                                                            Magnum Gilt (LT- Div)                   Magnum Gilt (LT-Gr)
                                                                     2001-2002           2000-2001           2001-2002           2000-2001
 NAV at the beginning of the period                                     10.1264               10.00             10.3258               10.00
 Net income per unit                                                       1.107              0.426               1.055               0.326
 Dividends per unit                                                         0.70                0.30                  —                   —
 Transfer from Reserves                                                       —                   —                   —                   —
 NAV at the end of the period (31/05/2001)                              10.4071             10.1264             11.0547             10.3258
 Annualized return since inception for the period                       7.00%*              4.26%*             10.55%*              3.26%*
 Net Asset at the end of the period                                       458.16             258.66               23.48               14.13
 Ratio of Recurring expenses to Net Assets                                1.28%              0.62%               1.30%               1.24%
                                rd
 (Date of allotment of units: 23 December 2000)
 Particulars                                                                          Magnum Monthly Income Plan
                                                                        Growth          Annual Div        Quarterly Div        MonthlyDiv
 NAV at the beginning of the period                                        10.00              10.00               10.00               10.00
 Net income per unit                                                       0.598              0.607               0.299               0.388
 Dividends per unit                                                           —                   —               0.215              0.2480
 Transfer from Reserves                                                       —                   —                   —                   —
 NAV at the end of the period                                           10.5978             10.6071             10.2993             10.1401
 Annualized return since inception for the period                       5.98%*              6.07%*              5.14%*              3.88%*
 Net Asset at the end of the period                                        20.90              10.29               11.50               11.02
 Ratio of Recurring expenses to Net Assets                              1.475%              1.475%              1.475%              1.475%
                                rd
 (Date of allotment of units: 23 March 2001)
Note: The NAV for 2001-2002 is dated as on 31st July 2001 and for the other years is dated 31st March 2001. The historical per unit statistics
have been calculated upto the period ending 31st July 2001. The compounded annualized returns have been calculated since inception of
the schemes, taking adjusted NAV, i.e., after adjusting dividends paid out on initial NAV of Rs. 10/- per Magnum. * - indicates the returns
for periods less than one year are in absolute terms only and not annualized.




                                                                     11
MAGNUM LIQUIBOND INCOME FUND
2. Disclosure under Regulation 25(11)
As on 31st March 2001, SBI Mutual Fund has made the following investments in companies that hold units in excess of 5% of the Net Asset
Value of any scheme of SBI Mutual Fund:
 Scheme Name                  Investments by the respective schemes in Companies                   Value              % of holding to
                              or its subsidiaries where that Company or its                        (Rs. Lakhs)        NAV
                              subsidiaries have invested more than 5% of the
                              NAV in any scheme
 Gifts-B                      State Bank of India (Equity)                                         181.17             2.84
 MMPS 93                      State Bank of India (Equity)                                         380.26             1.74
                              SBI Home Finance Ltd. (Equity)                                       0.01               Negligible
 MELS91                       State Bank of India (Equity – Demat)                                 0.10               Negligible
 MMIS-97                      State Bank of India (Equity)                                         20.92              0.48
                              State Bank of Hyderabad (Bonds)                                      143.07             3.26
                              State Bank of Travancore (Bonds)                                     105.8              2.41
 Magnum Balanced Fund        State Bank of India (Equity)                                          0.10               Negligible
 (formerly MOEF-95)          State Bank of Hyderabad (Bonds)                                       105.20             0.92
                             State Bank of Travancore (Bonds)                                      105.80             0.93
 MLIF-98                      State Bank of India (Bonds)                                          507.03             0.69
 MMIS 98(II)                 State Bank of Saurashtra (Bonds)                                      105.58             0.66
 MMIS 98(I)                  SBH (Bonds)                                                           105.20             0.87
                             State Bank of Saurashtra (Bonds)                                      52.79              0.44
These investments comprise debt, equity and money market instruments. SBI Mutual Fund is of the opinion that the said companies are
fundamentally strong and possess a high potential for growth and are market leaders in their respective fields. Accordingly, investments
were made in the said companies. The investments made by some schemes of SBIMF in bonds issued by associate companies including
State Bank of India and its subsidiaries are in compliance with the investment restrictions contained in clause 9 of the seventh schedule to
the SEBI (MF) Regulations, 1996.

                                         VIII. CONSTITUTION OF THE MUTUAL FUND

1. Constitution
SBI Mutual Fund has been constituted as a Trust, sponsored by SBI. SBI has made an initial contribution of Rs. 5 lacs towards setting up of
the Trust fund. SBI has been designated as the Principal Trustee, and has appointed a Board of Trustees to supervise the activities of the
Fund. The Board of Trustees have entrusted the work of management of the Fund to SBI Funds Management Ltd., an Asset Management
Company.

2. Objective of SBI Mutual Fund
The basic objective of SBI Mutual Fund is to mobilize savings from a wide cross-section of people and to provide them attractive returns,
security and liquidity through investments in capital and money markets.

3. The Sponsor
The State Bank of India or SBI having its Corporate Office at State Bank Bhavan, Madame Cama Road, Mumbai - 400 021, is the largest
public sector bank in India with 9026 branches in India and 52 offices in 31 countries worldwide. In addition to this, SBI also has 7
associates and 1 banking subsidiary in addition to other non-banking subsidiaries in India and abroad. SBI is the leader in providing loans
and related services (which generate significant fee-based income) to trade & industry. It has also identified project finance and consumer
banking as key areas.




                                                                     12
MAGNUM LIQUIBOND INCOME FUND
The financial performance of SBI is summarized below:
 Year ended March 31st                                 2001                2000               1999                 1998                1997
 Turnover / Total Income (Rs. Cr.)                    30021               25770              22392                18699              17594
 Profit after Tax (Rs. cr.)                            1604                2051               1028                 1861                1349
 Equity Capital (Rs. cr.)                               526                 526                   526               526                    526
 Free Reserves (Rs. cr.)                              12935               11620               9876                 9082                7451
 Net Worth (Rs. Cr.)                                  13461               12147              10402                 9608                7977
 Deposits (Rs. Cr.)                                 216121                196821            169041               131091             110701
 Earnings per share (Rs.)                              30.48               38.98              19.53               35.36               26.66
 Book Value per share (Rs.)                           255.76              230.93            197.64               182.66              151.65
 Capital Adequacy Ratio (%)                            12.79               11.49              12.51               14.58               12.17
 Dividend paid (%)                                     50%                  50%               40%                  40%                 40%
Source: SBI Annual Reports

4. Board of Trustees
The Trust is administered by a Board of Trustees comprising the following eminent persons:
 Name                         Address                          Principal Occupation          Current Directorships
 Prof. A.M. Khusro            B-11, Chirag Enclave,            Formerly Chairman,            1. Chairman, Kohinoor Cement Ltd.
 Chairman,                    New Delhi -110 048               Finance Commission            2. Director, Transworld Leasing Ltd.
 Board of Trustees                                                                           3. Director, Hi-Tech Security Prints Ltd.
                                                                                             4. Director, CT Cotton Yarn Ltd.
                                                                                             5. Director, Indian Express Newspaper
                                                                                             6. Director, Traders Ltd.
                                                                                             7. Director, Mekaster Finlease Ltd.
                                                                                             8. Chairman, Mekaster Securities (P) Ltd.
 Dr.(Mrs.) Malati Anagol      Flat No. 6, Koumari,             Formerly Professor, UGC,      1.    Director, Imeco Ultrasonics Pvt. Ltd.
 Trustee                      Ahimsa Marg, Khar (West),        University of Bombay          2.    Director, Imeco Cleaning & Welding
                              Mumbai – 400 052                                                     Equipments (P) Ltd.
 Prof. S. K. Barua            Indian Institute of              Professor, IIM,               None
 Trustee                      Management, Vastrapur,           Ahmedabad
                              Ahmedabad-380 015
 Shri M. M. Chitale           205, Agarwal                     Chartered Accountant          1. Director, IDBI Bank Ltd.
 Trustee                      Shyamkamal – A                                                 2. Director, Investor Services of India Ltd.
                              Ville Parle (E)                                                3. Director, Sun Vacuum Formers Ltd.
                              Mumbai 400 057
All the above dignitaries are independent persons. SBI, the sponsor, is in the process of appointing one of its senior officials as a Trustee
to the Board in place of Shri Vepa Kamesam who has been appointed as Deputy Governor, RBI.
Apart from one nominee member of SBI (to be nominated) no other trustee is an associate of the Sponsor or of the AMC. SBIMF has been
complying with SEBI regulations stipulating that two third members must be independent.

5. Duties and Obligations of Trustees and Substantial Provisions of the Trust Deed:
The Board of Trustees monitors the activities of the AMC. In the last financial year, the Board of Trustees met 4 times. Periodic reports,
including quarterly reviews of each scheme, are submitted by the AMC to the Trustees. Specific approval of the Trustees is obtained on
important matters such as a new scheme design and launch.
Under the Trust Deed constituting the Mutual Fund and SEBI (Mutual Fund) Regulations, 1996, the Trustees have several rights, duties and
obligations including the following:
a)   To enter into an investment management agreement with the AMC with the prior approval of SEBI.
b)   To ensure that the investment management agreement contains such clauses as are mentioned in the Fourth Schedule of SEBI (Mutual
     Fund) Regulations, 1996 and such other clauses as are necessary for the purpose of making investment.
c)   To ensure before the launch of any scheme that the AMC has:-
     i      systems in place for its back office, dealing room and accounting;
     ii     appointed all key personnel including fund manager(s) for the scheme(s) and submitted their bio-data which shall contain the


                                                                     13
MAGNUM LIQUIBOND INCOME FUND
             educational qualifications, past experience in the                         personnel of the AMC in his own name or on behalf of the
             securities market with the trustees, within 15 days of                     AMC and shall report to the SEBI, as and when required.
             their appointment;                                                  p)     To quarterly review all transactions carried out between the
     iii     appointed auditors to audit its accounts;                                  mutual fund, asset management company and its associates.
     iv      appointed a compliance officer to comply with                       q)     To continuously review the net worth of the AMC and in case
             regulatory requirements and to redress investor                            of any shortfall, ensure that the AMC make up for the shortfall
             grievances;                                                                as per clause (f) of sub-regulation (1) of regulation 21 of SEBI
                                                                                        (Mutual Fund) Regulations, 1996.
     v       appointed registrars and laid down parameters for their
             supervision;                                                        r)     To periodically review all service contracts such as custody
                                                                                        arrangements, transfer agency of the securities and satisfy
     vi      prepared a compliance manual and designed internal
                                                                                        itself that such contracts are executed in the interest of the
             control mechanisms including audit systems;
                                                                                        magnumholders.
     vii     specified norms for empanelment of brokers and
                                                                                 s)     To ensure that there is no conflict of interest between the
             marketing agents.
                                                                                        manner of deployment of its net worth by the AMC and the
d)   To ensure that the AMC has been diligent in empanelling the                        interest of the magnumholders.
     brokers, in monitoring securities transactions with brokers
                                                                                 t)     To periodically review the investor complaints received and
     and avoiding undue concentration of business with any broker.
                                                                                        the redressal of the same by the AMC.
e)   To ensure that the AMC has not given any undue or unfair
                                                                                 u)     To abide by the Code of Conduct as specified in the fifth
     advantage to any associates or dealt with any of the associates
                                                                                        schedule of SEBI (Mutual Fund) Regulations, 1996.
     of the asset management company in any manner detrimental
     to the interest of the magnumholders.                                       v)     To furnish to the SEBI on a half yearly basis :-
f)   To ensure that the transactions entered into by the asset                          i       a report on the activities of the mutual fund;
     management company are in accordance with SEBI (Mutual                             ii      a certificate stating that the trustees have satisfied
     Fund) Regulations, 1996 and the scheme.                                                    themselves that there have been no instances of self
g)   To ensure that the AMC has been managing the mutual fund                                   dealing or front running by any of the trustees, directors
     schemes independently of other activities and have taken                                   and key personnel of the AMC;
     adequate steps to ensure that the interests of investors of one                    iii     a certificate to the effect that the AMC has been
     scheme are not being compromised with those of any other                                   managing the schemes independently of any other
     scheme or of other activities of the asset management                                      activities and in case any activities of the nature referred
     company.                                                                                   to in sub-regulation (2) of regulation 24 of SEBI (Mutual
h)   To ensure that all activities of the AMC are in accordance with                            Fund) Regulations, 1996 have been undertaken by the
     the provisions of SEBI (Mutual Fund) Regulations, 1996.                                    AMC and has taken adequate steps to ensure that the
                                                                                                interests of the magnumholders are protected.
i)   Where the trustees have reason to believe that the conduct of
     business of the mutual fund is not in accordance with SEBI                  w) The independent Trustees referred to in regulation 16 shall
     (Mutual Fund) Regulations, 1996 and the scheme they shall                          give their comments on the report received from the AMC
     forthwith take such remedial steps as are necessary by them                        regarding the investments made by the schemes in the
     and shall immediately inform the SEBI of the violation and the                     securities of group companies of the Sponsor.
     action taken by them.                                                       x)     The trustees shall ensure that no change in the fundamental
j)   To file the details of his/her holdings in securities on a quarterly               attributes of any scheme or the trust or fees and expenses
     basis with the trust.                                                              payable or any other change which would modify the scheme
                                                                                        and affects the interest of Magnum holders, shall be carried
k)   To be accountable for, and be the custodian of, the funds and
                                                                                        out unless, a written communication about the proposed
     property of the respective schemes and to hold the same in
                                                                                        change is sent to each Magnum holder and an advertisement
     trust or the benefit of the unit holders in accordance with SEBI
                                                                                        is given in one English daily newspaper having nationwide
     (Mutual Fund) Regulations, 1996 and the provisions of trust
                                                                                        circulation as well as in a newspaper published in the language
     deed as amended from time to time and the provisions of
                                                                                        of the region where the Head Office of the mutual fund is
     trust deed and supplemental trust deeds thereof.
                                                                                        situated; and the Magnum holders are given an option to exit
l)   To take steps to ensure that the transactions of the mutual fund                   at the prevailing Net Asset Value without any exit load.
     are in accordance with the provisions of the trust deed.
                                                                                 Explanation: For the purposes of this clause “fundamental attributes”
m)   To be responsible for the calculation of any income due to be               means the investment objectives and terms of a scheme as defined
     paid to the mutual fund and also of any income received in                  later in the offer document under the section “Investment Objectives
     the mutual fund for the holders of the units of any scheme in               and Policies”.
     accordance with SEBI (Mutual Fund) Regulations, 1996 and
     the trust deed.                                                             As per the sub-regulation (25), the Trustees shall exercise due
                                                                                 diligence as under:
n)   To obtain the consent of the magnumholders :-
     i       whenever required to do so by the SEBI in the interest              A. General Due Diligence:
             of the magnumholders; or
                                                                                 (i)    the Trustees shall be discerning in the appointment of the
     ii      whenever required to do so on the requisition made by                      directors on the Board of the asset management company.
             three fourths of the magnumholders of any scheme; or
                                                                                 (ii)   Trustees shall review the desirability of continuance of the
     iii     when the majority of the trustees decide to wind up or                     asset management company if substantial irregularities are
             prematurely redeem the units;                                              observed in any of the schemes and shall not allow the asset
o)   To call for the details of transactions in securities by the key                   management company to float new schemes.


                                                                            14
MAGNUM LIQUIBOND INCOME FUND
(iii)   The trustee shall ensure that the trust property is properly            of 8.09%, 10-year paper is currently being traded at yield of 9.35%
        protected, held and administered by proper persons and by               s.a. yield. Issuances are also made for State Governments through
        a proper number of such persons.                                        state development loans. There is an active secondary market in
(iv)    The trustee shall ensure that all service providers are holding         Government Securities, which is dealt through a network of brokers,
        appropriate registrations from the Board or concerned                   PDs, FIs and Banks.
        regulatory authority.                                                   In the corporate bond market various types of issuers are present
(v)     The Trustees shall arrange for test checks of service contracts.        like PSUs, Banks, NBFCs and Manufacturing companies. The
                                                                                corporate bond market yields track the G Sec market. The gilt yield
(vi)    Trustees shall immediately report to Board of any special
                                                                                curve is the benchmark for pricing corporate bonds issued by
        developments in the mutual fund.
                                                                                Public Sector Units/ Public Sector Financial Institutions and private
B. Specific Due Diligence:                                                      sector entities. The spread on corporate bonds over the gilts is
                                                                                based on tenor and ratings given on the bonds. The spread on a 5-
The Trustees shall:                                                             year AAA rated paper over the relative Government Security is 1%
(i)     obtain internal audit reports at regular intervals from                 while for AA rated paper, the spread is around 1.50%. Similarly the
        independent auditors appointed by the Trustees.                         for a 2-year AAA paper, the spread is 1.10% while it is 1.60% for an
(ii)    obtain compliance certificates at regular intervals from the            AA paper.
        asset management company.                                               There is also an active call and money market although access to
(iii)   hold meeting of trustees at frequent intervals.                         call money is being withdrawn gradually in 4 stages for non-bank
                                                                                participants. The money market instruments presently available
(iv)    consider the reports of the independent auditors and
                                                                                include reverse repos, T-Bills, MIBOR linked floating rate papers, 7
        compliance reports of asset management company at the
                                                                                day bank deposits and CPs of mainly 90 day maturity. Currently the
        meetings of trustees for appropriate action.
                                                                                yield on 1-year T Bill is about 7.4%. Presently the yield on 90-day
(v)     maintain records of the decisions of the Trustees at their              CP is around 8.35 – 8.50%. Overnight call rates vary from day to
        meetings and of the minutes of the meetings.                            day. Any cash can be lent in this market so as not to remain idle.
(vi)    prescribe and adhere to a code of ethics by the Trustees,               Liquidity is of prime importance while making investments.
        asset management company and its personnel.                             Depending on sentiments certain tenors become more liquid. For
(vii) communicate in writing to the asset management company                    example during a bullish phase long tenor paper gain interest
      of the deficiencies and checking on the rectification of                  while in a bearish market short maturity papers like T Bills, CPs etc
      deficiencies.                                                             are more actively traded.
                                                                                The recent monetary and credit policy 2001-02 has tried to deepen
6. Trusteeship Fees
                                                                                the debt and money markets and make it more liquid. By 30th
As per the provisions of the trust deed, the Principal Trustee, viz.,           September 2001 all corporate bonds have to be in book entry
State Bank of India, is entitled to a trusteeship fee of 0.01% p.a. of          form. All CPs and corporate instruments are required to be traded
net asset value of each scheme, subject to a minimum fee of Rs. 15              in the electronic mode.
lakhs to be allocated across schemes in proportion to their weekly
                                                                                A few instruments whose current indicative yields (as in August
average NAVs. Fees, however can be modified with the approval
                                                                                2001) match the maturity of various Funds, are indicated below:
of the Board of Trustees, within reasonable limits.
                                                                                 Instrument                    Yield    Instrument            Yield
7. Modifications to the Trust Deed
                                                                                 364 day T Bill                 7.40    RPL (Jul 2002)         9.32
No amendments to the Trust Deed will be carried out without the
prior approval of SEBI and the Magnumholders’ approval would                     11.68% G Sec 2006              8.09    HDFC (Dec 2001)        8.20
be obtained where it affects the interests of the Magnumholder.                  11.30% G Sec 2010              9.30    NPC (Dec 2005)         9.40
        IX. INVESTMENT OBJECTIVES & POLICIES                                     90 days CP                     8.00    SBI (Apr 2006)         9.37
                                                                                 11.15% G Sec 2002              7.51    RIL ( June 2004)       9.45
1. State of Debt and Money markets in India
                                                                                 12.5 G Sec 2004                7.99    ICICI (Jun 2002)       9.32
The Debt market in India consists of two types of markets – Primary
and Secondary. Of all debt instruments the most active and liquid is            2. Objective of the Scheme
the Government Securities market. Reserve Bank of India issues
securities on behalf of the Government of India through auctions                The objective of the scheme is to provide the investors an
and open market operations. In Government Securities, papers are                opportunity to earn, in accordance with their requirements, through
available of various tenors from 1 year to 20-year papers. RBI also             capital gains or through regular dividends, returns that would be
issues Treasury Bills upto 364 days maturity. 5-year tenor                      higher than the returns offered by comparable investment avenues
Government Securities are currently being traded at around a yield              through investment in debt & money market securities.




                                                                           15
MAGNUM LIQUIBOND INCOME FUND
3. Investment Strategy                                                         instrument is not rated, mutual funds may constitute committees
                                                                               who can approve such proposals for investments in unrated
The investment pattern of the scheme will be as follows:                       instruments subject to the approval of the detailed parameters for
    Instrument                              % of portfolio                     such investments by the Board of Directors and the Board of
                                                                               Trustees.
    Corporate debentures & Bonds /          Upto 90%
    PSU / FI / Govt. Guaranteed Bonds /                                        However, the above investment pattern may be changed at the
    Other including Securitised Debt                                           discretion of the Fund Manager in the interest of the investors
                                                                               provided such changes do not result in a change in the fundamental
    Securitized Debt                        Not more than 10%                  attributes / investment profile of the scheme and are short term
                                            of investments in debt             changes on defensive consideration. The funds raised under the
                                                                               scheme shall be invested only in transferable securities as per
    Government Securities                   Upto 90%                           Regulation 44(1), Schedule 7 of the SEBI (Mutual Funds) Regulations,
                                                                               1996.
    Cash & Call Money                       Upto 25%
    Money Market Instruments *              Upto 25%                           4. Trading in Derivatives
    Units of other mutual funds             Upto 5%                            A   (i)     The Fund may use any hedging techniques that are
                                                                                           permissible now or in future, under SEBI regulations, in
*       Money Market Instruments will include Commercial Paper,
                                                                                           consonance with the scheme’s investment objective,
        Certificates of Deposit, Treasury Bills, Bills Rediscounting,
                                                                                           including investment in derivatives such as interest rate
        Repos, short term bank deposits, short-term Government
                                                                                           swaps. As per SEBI guidelines, the Fund’s trading in
        securities (of maturities less than 1 year) and any other such
                                                                                           derivatives shall be restricted to hedging and portfolio
        short-term instruments as may be allowed under the
                                                                                           balancing purposes. The Fund shall fully cover its position
        regulations prevailing from time to time.
                                                                                           in the derivatives market by holding underlying securities
The investments may be made in primary as well as secondary                                / cash or cash equivalents / option and / or obligation for
markets. The portfolio will be sufficiently diversified so as to reduce                    acquiring underlying assets to honour the obligations
the risk of underperformance due to unexpected security-specific                           contracted in the derivatives market. The Fund shall
factors. If allowed in future, the fund may invest in foreign debt                         maintain separate records for holding the cash and cash
(subject to relevant RBI guidelines and subject to RBI approval).                          equivalents / securities for this purpose. The securities
Any investment in Government securities may be in securities                               held shall be marked to market by the AMC to ensure full
supported by ability to borrow from the Treasury, or sovereign or                          coverage of investments made in derivative products at
state government guarantee, or supported by the Government of                              all times.
India / a State Government in any other manner.
                                                                                    (ii)     Illustration: Interest Rate Swap (IRS)
The Scheme being open-ended, some portion of the portfolio will
                                                                                            Assume that a Mutual Fund has INR 10 crore, which is
be invested in highly liquid money market instruments or
                                                                                            to be deployed in overnight products for 7 days. This
government paper so as to meet the normal repurchase
                                                                                            money will be exposed to interest rate risk on daily
requirements. The remaining investments will be made in securities
                                                                                            basis. The fund can buy an Interest Rate Swap receiving
which are either expected to be reasonably liquid or of varying
                                                                                            fixed interest rate and paying NSE MIBOR.
maturities. However, the NAV of the Scheme may be impacted if
the securities invested in are rendered illiquid after investment.                           The deal will be as under:
Please refer to the paragraph “Right to Limit Redemptions” in the
                                                                                           Counterparty Bank                          Mutual Fund
section “Redemptions and Repurchase”. Please refer to the section
“NAV and Valuation of Assets of the Scheme”.                                                          Floating rate (NSE MIBOR)
Debt instruments in which the scheme invests shall be rated as not
below investment grade by at least one recognized credit rating                            Receives                                   Pays
agency authorized under the SEBI Act, 1992. In case of short-term
instruments, investments will be restricted to the instruments having                                    Fixed rate (8.75%)
CRISIL rating of P-2 and above and/or ICRA rating of A-2 and
                                                                                           Pays                                       Receives
above or equivalent rating by other rating agencies. In case a debt




                                                                          16
MAGNUM LIQUIBOND INCOME FUND
The cash flows on a notional principal amount of Rs. 10 crs. would be-
                                                                                                                                        (In Rs. Crore)
                                                                                 Principal          NSE MIBOR            Interest            Amount
                                    Day 1                                        10.0000                8.10%          .0022192          10.00221918
                                    Day 2                                        10.00222               8.20%          .0022466          10.00446575
                                    Day 3                                        10.00447               8.30%            .002274         10.00673973
                              Day 4 (for 2 days)              Saturday           10.00674               8.15%          .0044658          10.01120548
                                    Day 5                     Sunday                                   Holiday
                                    Day 6                                        10.01121               8.40%          .0023014          10.01350685
                                    Day 7                                        10.01351               8.50%          .0023288          10.01583562
                          Floating Interest Payable                                                                                      .0158356164
                          Fixed Interest Receivable                                                                                      .0167808219
             Net Receivable for Mutual Fund receiving fixed rate                                                                         .0009452055
     In this example Mutual Fund stands to gain by receiving fixed rates. As the NSE MIBOR floating rate is decided daily, in adverse
     scenario, the Mutual Fund may have to pay the difference.
     The counter-party providing Swap, Options, Forward Rate Agreements (FRAs) will do the same at a cost.
     (iii)    The risks involved in derivatives are:                                 (v)     The use of derivatives for hedging will give benefit of:
             1.    The cost of hedge can be higher than adverse                              1.   Curtailing the losses due to adverse movement in
                   impact of market movements.                                                    interest rates
             2.    The derivatives will entail a counter-party risk to                       2.    Securing upside gains at cost
                   the extent of amount that can become due from
                                                                                     (vi)    Exposure limits: Currently the Mutual Fund intends to
                   the party.
                                                                                             have an exposure not exceeding 5% of the net assets of
             3.    An exposure to derivatives in excess of the                               the scheme in derivative instruments under Magnum
                   hedging requirements can lead to losses.                                  Index Fund.
             4.    An exposure to derivatives can also limit the profits        b)   Valuation
                   from a genuine investment transaction.
                                                                                     (i)     The traded derivatives shall be valued at market price
             5.    Efficiency of a derivatives market depends on the                         in conformity with the stipulations of sub clauses (i) to
                   development of a liquid and efficient market for                          (v) of clause 1 of the Eighth Schedule to the SEBI
                   underlying securities and also on the suitable and                        Regulations.
                   acceptable benchmarks.
                                                                                     (ii)    The valuation of untraded derivatives shall be done in
             Methods to tackle these risks:                                                  accordance with the valuation method for untraded
                                                                                             investments prescribed in sub clauses (i) and (ii) of clause
             1.    Hedging will not be done on a carpet basis but
                                                                                             2 of the Eighth Schedule to the SEBI Regulations.
                   based on a view about interest rates, economy
                   and expected adverse impact.                                 c)   Reporting
             2.    Limits of appropriate nature will be developed                    The AMC shall cover the following aspects in their reports to
                   for counter parties                                               trustees periodically, as provided for in the Regulations:
             3.    Such an exposure will be backed by assets in the                  (i)     Transactions in derivatives, both in volume and value
                   form of cash or securities adequate to meet cost                          terms.
                   of derivative trading and loss, if any, due to
                                                                                     (ii)    Market value of cash or cash equivalents / securities
                   unfavourable movements in the market.
                                                                                             held to cover the exposure.
     (iv)     The losses that may be suffered by the investors as a
              consequence of such investments:                                       (iii)   Any breach of the exposure limit laid down in the
                                                                                             scheme offer document.
             1.    As the use of derivatives is based on the judgement
                   of the Fund Manger, the view on market taken may                  (iv)    Short-fall, if any, in the assets covering investment in
                   prove wrong resulting in losses.                                          derivative products and the manner of bridging it.
             2.    The upside potential of investments may be limited                (v)     The Trustees shall offer their comments on the above
                   on account of hedging which may cause                                     aspects in the report filed with SEBI under sub regulation
                   opportunity losses.                                                       (23) (a) of regulation 18 of SEBI Regulations.




                                                                           17
MAGNUM LIQUIBOND INCOME FUND
4. Fundamental Attributes                                                    c.   Debt instruments in which the scheme invests should be rated
                                                                                  as not below investment grade by at least one recognized
The following attributes will be considered as fundamental                        credit rating agency authorized under the SEBI Act, 1992. In
attributes :                                                                      case a debt instrument is not rated, mutual funds may
1. Type of Scheme          : Open-ended debt scheme.                              constitute committees who can approve such proposals for
                                                                                  investments in unrated instruments subject to the approval of
2. Investment Objective : To provide the investors an
                                                                                  the detailed parameters for such investments by the Board of
                          opportunity to earn, in accordance
                                                                                  Directors and the Board of Trustees.
                          with their requirements, through
                          capital gains or regular dividends,                d.   Transfer of investments from one scheme to another scheme,
                          returns through investment in debt &                    including this scheme, under the Mutual Fund shall be allowed
                          money market securities. The                            only if :
                          investment objective is given in the                    (i)    Such transfers are done at the prevailing market price
                          following paragraphs in this section.                          for quoted securities on spot basis; explanation – “spot
3. Terms of Issue          : The nature & duration of the Scheme,                        basis” shall have the same meaning as specified by the
                             provision for repurchase, Scheme                            stock exchange for spot transactions, and
                             expenses & fees, as stated elsewhere                 (ii)   The securities so transferred shall be in conformity with
                             in the Offer Document.                                      the investment objective of the relevant scheme to which
The fundamental attributes as defined above or fees and expenses                         such transfer has been made.
payable or any other change which would modify the scheme and                e.   The scheme may purchase or sell securities to any other
affects the interest of Magnum holders, shall not be carried out                  scheme of the Mutual Fund as stated above.
unless, a written communication about the proposed change is
sent to each Magnum holder and an advertisement is given in one              f.   The Mutual Fund shall buy and sell securities on the basis of
English daily newspaper having nationwide circulation as well as                  deliveries and shall in all cases of purchases, take delivery of
in a newspaper published in the language of the region where the                  relative securities and in all cases of sale, deliver the securities
Head Office of the mutual fund is situated; and the Magnum holders                and shall in no case put itself in a position whereby it has to
are given an option to exit at the prevailing Net Asset Value without             make short sale or carry forward transaction or engage in
any exit load.                                                                    badla finance.
                                                                             g.   The scheme shall provide that the securities be purchased or
5. Investment limitations                                                         transferred in the name of the Mutual Fund for the relevant
The investment policies of the scheme comply with the rules,                      scheme, wherever the investments are intended to be of a
regulations and guidelines laid out in the SEBI (MF) Regulations,                 long-term nature.
1996. As per the Regulations, specifically the Seventh Schedule,             h.   Pending deployment of funds of the scheme in securities
the following investment limitations are applicable to schemes of                 pursuant to the investment objectives of the scheme the Mutual
Mutual Funds.                                                                     Fund can invest the funds of the scheme in short-term deposits
a.   The scheme shall not invest more than 15% of its NAV in debt                 of scheduled commercial banks.
     instruments issued by a single issuer which are rated not below         i.   The assets of the scheme shall not in any manner be used in
     investment grade by a credit rating agency authorized to                     short selling or carry forward transactions.
     carry out such activity under the Act. Such investment limit
     may be extended to 20% of the NAV of the scheme with the                j.   The mutual fund under all its schemes will not own more than
     prior approval of the Board of Trustees and the Board of                     ten per cent of any company’s paid up capital carrying voting
     Asset Management Company. Such limit shall not be                            rights.
     applicable for investments in government securities and                 k.   The scheme may invest in another scheme under the same
     money market instruments. Also investment within such limit                  asset management company or any other mutual fund without
     can be made in mortgaged-backed securitized debt, which                      charging any fees, provided that aggregate interscheme
     are rated not below investment grade by a credit rating                      investment made by all schemes under the same management
     agency registered with the Board.                                            or in schemes under the management of any other asset
b.   The scheme shall not invest more than 10% of its NAV in                      management company shall not exceed 5% of the net asset
     unrated debt instruments issued by a single issuer and the                   value of the mutual fund.
     total investment in such instruments shall not exceed 25% of            l.   The mutual fund will enter into derivatives transactions in a
     the NAV of the scheme. All such investments shall be made                    recognized stock exchange for the purpose of hedging and
     with the prior approval of the Board of Trustees and the Board               portfolio balancing, in accordance with the guidelines issued
     of AMC.                                                                      by the Board.




                                                                        18
MAGNUM LIQUIBOND INCOME FUND
m.   The scheme shall not make any investment in;                              “ A scheme may invest in another scheme under the same asset
                                                                               management company or any other mutual fund without
     i      any unlisted security of an associate or group company
                                                                               charging any fees, provided that aggregate inter-scheme
            of the sponsor; or
                                                                               investment made by all schemes under the same management
     ii     any security issued by way of private placement by an              or in schemes under the management of any other asset
            associate or group company of the sponsor; or                      management company shall not exceed 5% of the net asset value
     iii    the listed securities of group companies of the sponsor            of the mutual fund”.
            which is in excess of 25% of the net assets .                      In order to be consistent with the Scheme’s objectives, such an
Notwithstanding the foregoing investment policies, for temporary               investment may only be in another scheme investing in debt and /
defensive purposes (e.g., during periods in which the Asset                    or money market instruments and / or derivatives based on these,
Management Company believes changes in the securities markets                  and will not be in any scheme which invests in equity or equity-
or economic or other conditions warrant), the scheme may invest                linked securities or derivatives based on equity. No investment
substantially in Indian Government Treasury Bills and or keep cash             management fee will be charged by the AMC on such investments.
balances which will be deployed in call markets. The Trustees
                                                                               9. AMC’s investments in the scheme
have the right in their sole discretion, to limit redemptions under
certain circumstances. Please refer to the paragraph “Right to                 The AMC may invest in the scheme on an ongoing basis, such
Limit Redemptions” in the section “Redemption and Repurchase”.                 amount as they deem appropriate. But the AMC shall not be entitled
Please refer to the section “NAV and Valuation of Assets of the                to charge any management fees on this investment in the scheme.
scheme”.                                                                       Investments by the AMC will be in accordance with Regulation
                                                                               24(3) of the SEBI(MF) Regulations, 1996 which states that :
6. Portfolio Turnover Policy
                                                                               “ the asset management company shall not invest in any of its
The portfolio may be churned in order to take advantage of                     schemes unless full disclosure of its intention to invest has been
anticipated interest rate movements or market opportunities in order           made in the offer document provided that the asset management
to maximise the average yield on the portfolio while maintaining a             company shall not be entitled to charge any fees on its investment
desirable risk profile and adequate liquidity. The impact of any rise          in the scheme.”
in interest rates will be reduced through good fund management
practices. In anticipation of an imminent rise in interest rates, the          10. Underwriting
Scheme will attempt to move the funds from long-term instruments
                                                                               The Scheme may take up underwriting of the securities of other
into short-term debt & money-market instruments where the impact
                                                                               issuers subject to the relevant SEBI Regulations and as may be
on the NAV will be much lower. Also, if the interest rates at any
                                                                               permitted by the Board of Directors of the AMC.
point of time are expected to ease, the Scheme can move back into
long-term debt to take advantage of appreciation in the market                 Regulation 46 states that :
value of its investments.                                                      “ Mutual Funds may enter into underwriting agreement after
7. Investments in Associate or Group Companies of the                          obtaining a certificate of registration in terms of the SEBI
                                                                               (Underwriters) Rules and SEBI (Underwriters) Regulations, 1993
Sponsor                                                                        authorising it to carry on activities as underwriters.
The scheme will not invest more than 25% of net assets of the                  (1)   For the purpose of these regulations, the underwriting
scheme in the securities of the State Bank Group companies. Further,                 obligation will be deemed as if the investments are made in
the aggregate investment made by all the SBI Mutual Fund schemes                     such securities.
in the securities of State Bank Group companies will not exceed                (2)   The capital adequacy norms for the purpose of underwriting
25% of the net assets of the fund as a whole. The scheme shall not                   shall be the net assets of the scheme. Provided that the
invest in privately placed or unlisted securities of associates / group              underwriting obligation of a mutual fund shall not at any
companies.                                                                           time exceed the total net asset value of the scheme.”
8. Investment in other schemes                                                 11. Procedures followed for Investment decisions
The investment by this scheme in other mutual fund schemes will                The proposals for investments in equity/debt or market instruments
be in accordance with Regulation 44(1), Schedule 7 of the SEBI                 originate from the Fund Manager and are routed through the VP
(MF) Regulations, 1996 according to which :                                    (Debt) or Chief Investment Officer to the Investment Committee. The




                                                                          19
MAGNUM LIQUIBOND INCOME FUND
committee comprising the Managing Director, Executive Vice                     total net assets of approximately Rs.3400 crores (as on 31st July
President, CIO, VP (Debt), Head of Research, Debt and Equity Dealers           2001), including offshore funds.
decide on the proposals of the Fund Managers. Each proposal is a
written document with reasons for the proposed sale/repurchase                 2. AMC Fees
or reasons for rejection (if any) are recorded. The risk origination is        For management of the above funds, the AMC at present charges a
done based on the guidelines issued by SEBI or Board of Trustees.              fee not exceeding 1% of the weekly average NAV of each scheme,
Concurrent auditors periodically check these and their reports are             which is charged to the respective scheme. In future, the AMC may
placed before the Audit Committee which is comprised of the                    modify the fee from scheme to scheme, within the limits specified
independent Directors and Trustees.                                            in the Regulations and disclosed in the offer documents of the
The monitoring of decisions is taken through quarterly secondary               respective schemes.
and primary market report to the Directors. The Secondary market
report details the top 20 purchases and sale decisions in the quarter,         3. Board of Directors
the details of losses booked and the reasons thereof. All primary              The Board of Directors of the SBIFM comprises the following
market decisions are reported.                                                 eminent persons:
The performance of the equity reported to the AMCs and Trustees                 Shri Janki Ballabh              D-7, Kinellan Tower
is benchmarked against the BSE Sensitive Index and also to                      Chairman                        100A, Napean Sea Road,
comparable schemes in the industry while the performance of the                 State Bank of India             Mumbai - 400 006.
debt schemes are reviewed through the rankings issued by CRISIL/
Value Research etc                                                              Shri S.L. Rao                   D-1, Chartered Cottage
                                                                                Economist                       8-Langford Road,
             X. MANAGEMENT OF THE FUND                                                                          Bangalore - 560 025
                                                                                Shri R.G. Kare                  Kare House
The Board of Trustees of SBI Mutual Fund has entrusted the
                                                                                Industrialist                   Near Metropol Cinema
management of the Fund to SBI Funds Management Ltd., the AMC.
                                                                                                                Margao, Goa - 403 601.
Further details regarding the set up are furnished in the following
paragraphs.                                                                              .
                                                                                Shri D. P Roy                   D-11, Kinellan Tower
                                                                                Dy. Managing Director           100A, Napean Sea Road,
1. About the AMC                                                                Associate Banks and             Mumbai - 400 006.
SBI Funds Management Ltd. (SBIFM) having its corporate office at                Subsidiaries
191, Maker Tower “E”, 19th floor, Cuffe Parade, Mumbai - 400 005,               State Bank of India
is a wholly owned subsidiary formed by State Bank of India. As per              Shri Birendra Kumar             C-6, Kinellan Tower
the audited accounts on 31st March 2001, the authorized and paid                Managing Director               100A, Napean Sea Road,
up capital of the AMC was Rs. 50 crores and the net worth of the                SBI Capital Markets Ltd.        Mumbai - 400 006.
AMC was Rs. 55.97 crores.
                                                                                Shri Niamatullah                C-2, Kinellan Tower
SBI Funds Management Limited has signed an Investment                           Managing Director               100A, Napean Sea Road
Management Agreement with the Trustees of SBI Mutual Fund on                    SBI Funds Management Ltd.       Mumbai - 400 006.
14th May 1993. In terms of this Agreement, SBIFM has assumed the
                                                                                Shri Ajay Shah                  Santosh Nagar,
day to day investment management of the fund and in that capacity
                                                                                Asst. Professor                 General Arun Kumar
makes investment decisions and manages the SBI Mutual Fund
                                                                                Indira Gandhi Institute of      Vaidya Marg
Schemes in accordance with the scheme objectives, Trust Deed,
                                                                                Development Research            Film City Road,
provisions of Investment Management Agreement and SEBI
                                                                                                                Goregaon (E)
Regulations & Guidelines.
                                                                                                                Mumbai-400065
To date, SBIFM has successfully launched and managed 31 schemes
                                                                                Shri Manu Chadha                B-30 Kuthiala Building
(including 2 offshore funds) of SBI Mutual Fund. Of these 10 schemes
                                                                                Chartered Accountant            Connaught Place
have been redeemed. Of the 19 schemes still being managed, 11
                                                                                                                New Delhi 110 001.
are open-end schemes and the rest are close-end schemes, with




                                                                          20
MAGNUM LIQUIBOND INCOME FUND
4. Key Personnel
The day to day operations of the AMC are looked after by experienced and qualified professionals, consisting of senior officials on
deputation from the State Bank of India as well as directly recruited officials of the AMC.

a. The top key management personnel of SBI Funds Management Ltd. are
  Name & Age                      Designation                  Educational                   Business Experience
                                                               Qualifications
  Shri Niamatullah                Managing Director             M. Com, CAIIB                Experience of 35 years and 9 months
  60 years                                                                                   with SBI, including 12 years as a senior
                                                                                             executive.
  Shri K. G. Ravindran            Executive Vice President      M. Sc., CAIIB                Experience of 33 years and 8 months of
  58 years                                                                                   experience with SBI including 6 years as a
                                                                                             senior executive.

b. Head of Debt and Chief Funds Manager
  Name & Age                      Designation                  Educational                   Business Experience
                                                               Qualifications
  Shri Pijush Das                 Vice President                B.Sc., MA,                   13 years of experience in the treasury at
  48 years                                                      Economics                    the State Bank of India. Served as Head of
                                                                                             Treasury at SBI Singapore from 1995 to
                                                                                             1999.

c. Fund Manager
  Name & Age                      Designation                  Qualifications                Experience
  Shri Saravana Kumar             Assistant Vice President     B.E., PGDM (IIM – B),         Experience of over 8 years in area of funds
  35 years                                                     C.A.I.I.B                     management in the mutual fund industry and
                                                                                             4 years in the software industry. Presently
                                                                                             managing funds with net assets of about
                                                                                             Rs.875 crores .
In absence of the fund manager, one of the other fund managers will look after the operations of the scheme. The AMC will have the
discretion to change the Chief Investment Officer/Fund Manager depending on operational necessities and in the overall interest of the
fund.
The AMC has appointed the following people as fund managers for various schemes:
  Name & Age                      Designation                  Qualifications                Experience
  Shri Ajay Bodke                 Manager                      B.E. (Mechanical), MMS        Experience of over 6 years in the mutual
  30 years                                                                                   fund industry and presently managing funds
                                                                                             with net assets of about Rs. 350 crores
  Shri Sachin Sawrikar            Manager                      B.E., PGDM                    Experience of over 6 years in the mutual
  30 years                                                                                   fund industry and presently managing funds
                                                                                             with net assets of about Rs. 400 crores
  Shri Sandip Sabharwal           Manager                      B. Tech., P.G.D.M.            Experience of over 6 years in the mutual
  30 years                                                                                   fund industry and presently managing funds
                                                                                             with net assets of about Rs. 400 crores.

d. Head of Equity Research
  Name & Age                      Designation                  Qualifications                Experience
  Ms. Aparna Nirgude              Asst. Vice President          B. Com, M.B.A                Experience of over 8 years in the mutual
  29 years                                                                                   fund industry in the area of equity research
                                                                                             and funds management
The Equity Research team comprises of 8 junior management professionals having related experience of around 2 to 9 months.
e. Investor Relations Officer
The AMC has appointed M. Priolkar, Manager, as the Investor Relations Officer to look into investor grievances regarding deficiencies, if
any, in the services provided by the Registrars or the Investor Service Centres. He can be contacted at the address given in the section on
‘Investors’ Rights and Services’. The AMC will have the discretion to change the Investor Relations Officer depending on operational
necessities and in the overall interest of the fund.


                                                                   21
MAGNUM LIQUIBOND INCOME FUND
5. Duties and Obligations of the Asset Management                                     or by any other scheme of the same mutual fund in that
                                                                                      company or its subsidiaries shall be brought to the notice of
Company:
                                                                                      the trustees by the AMC and to be disclosed in the half yearly
Under the SEBI (Mutual Fund) Regulations, 1996 and the Investment                     and annual accounts of the respective schemes with justification
Management Agreement the AMC has the following obligations:                           for such investment provided the latter investment has been
                                                                                      made within one year of the date of the former investment
a)   to take all reasonable steps and exercise due diligence to
                                                                                      calculated on either side..
     ensure that the investment of funds pertaining to any scheme
     is not contrary to the provisions of SEBI (Mutual Fund)                     l)   to file with the trustees and the SEBI-
     Regulations 1996 and the Trust Deed.                                             i      detailed bio-data of all its directors alongwith their
b)   to exercise due diligence and care in all its investment                                interest in other companies within fifteen days of their
     decisions as would be exercised by other persons engaged                                appointment; and
     in the same business.                                                            ii     any change in the interests of directors every six months.
c)   to be responsible for the acts of commissions or omissions                       iii    A quarterly report to the trustees giving details and
     by its employees or the persons whose services have been                                adequate justification about the purchase and sale of
     procured by the AMC.                                                                    the securities of the group companies of the Sponsor
d)   to submit to the trustees quarterly reports of each year on its                         or the Asset Management Company, as the case maybe,
     activities and the compliance with SEBI (Mutual Fund)                                   by the Mutual fund during the said quarter.
     Regulations 1996.                                                           m)   to file with the trustees a statement of holdings in securities of
e)   The trustees at the request of the Asset Management Company                      the directors of the AMC with the dates of acquisition of such
     may terminate the assignment of the AMC at any time provided                     securities at quarterly intervals.
     that such termination shall become effective only after the                 n)   not to appoint any person as key personnel who has been
     trustees have accepted the termination of assignment and                         found guilty of any economic offence or involved in violation
     communicated their decision in writing to the AMC.                               of securities laws.
f)   Notwithstanding anything contained in any contract or                       o)   to appoint registrars and share transfer agents who are
     agreement or termination, the AMC or its directors or other                      registered with the SEBI.
     officers shall not be absolved of liability to the mutual fund for
     their acts of commissions or omissions, while holding such                       Provided if the work relating to the transfer of units is processed
     position or office.                                                              in-house, the charges at competitive market rates may be
                                                                                      debited to the scheme and for rates higher than the competitive
g)   not to deal in securities through any broker associated with                     market rates, prior approval of the trustees shall be obtained
     the sponsor or a firm which is an associate or a sponsor                         and reasons for charging higher rates shall be disclosed in
     beyond 5% of the daily gross business of the mutual fund.                        the annual accounts.
h)   not to utilize the services of the sponsor or any of its associates,        p)   to abide by the Code of Conduct as specified in the fifth
     employees or their relatives, for the purpose of any securities                  schedule of SEBI Regulations.
     transaction and distribution and sale of securities.
     Provided that the AMC may utilize such services if disclosure               6. Registrars
     to that effect is made to the unit holders and the brokerage or             SBIMF has appointed M/s Computronics Financial Services (India)
     commission paid is also disclosed in the half yearly/annual                 Ltd. (SEBI Registration Number: INR000001534) located at 1 Mittal
     accounts of the mutual fund *.                                              Chambers, Nariman Point, Mumbai – 400 021 as Registrars and
     *
       Note: Please note that the AMC utilizes the services of                   Transfer Agents to the scheme. The Board of Trustees and the AMC
     some branches of the SBI Group as authorized collecting                     have ensured that the Registrar has adequate capacity to discharge
     branches for the scheme. It may also utilize the services of                responsibilities with regard to processing of applications and
     some of the Associate companies of SBI for various                          dispatch of Magnum certificates to investors within the time limit
     transactions. This has also been mentioned in the section                   prescribed in the SEBI Regulations and that they have sufficient
     ‘Associate Transactions’. Suitable disclosure as required                   capacity to handle investor complaints. The AMC reserves the right
     under SEBI (MF) Regulations 2000 will be made in the half                   to change the Registrars at any time with the approval of the Board
     yearly and annual accounts of the Fund.                                     of Trustees and the Board of Directors of the AMC.
i)   to file with the trustees the details of transactions in securities         7. Register of Magnum holders
     by the key personnel of the asset management company in
     their own name or on behalf of the asset management                         A register of Magnum holders under this scheme containing the
     company and to also report to the SEBI, as and when required                necessary particulars will be maintained at the office of the Registrar
     by the SEBI.                                                                to the Scheme and at such place(s) as the Trustees may decide.

j)   In case the AMC enters into any securities transactions with                8. Custodians
     any of its associates, a report to that effect shall be sent to the
                                                                                 SBIMF Mutual Fund has appointed Stock Holding Corporation of
     trustees at their next meeting.
                                                                                 India Ltd or SHCIL (SEBI registration no. IN/CUS/011), situated at
k)   In case any company has invested more than 5% of the net                    Mittal Court, B Wing, 2nd floor, Nariman Point, Mumbai 400 021, as
     asset value of a scheme, the investment made by that scheme                 the Custodians for the scheme.



                                                                            22
MAGNUM LIQUIBOND INCOME FUND
The Custodians will be required to take delivery of all properties              sales charge (if any). This is calculated as follows :
belonging to the scheme and to hold them in separate custody
                                                                                POP = Applicable NAV per Magnum [1 + (applicable sales charge
account and also separately from the assets of the custodians and
                                                                                / 100)]
their clients. The Custodians will make efforts to have the properties
of the Fund registered in the name of the Fund and will deliver them            2. Period for which subscription is open
only as per instructions of the AMC and on receipt of the
consideration. The Custodians shall collect, receive and deposit in             On Ongoing basis, the Scheme will be open for subscription on a
the account or accounts of the Fund with the Bank, income, dividend,            daily basis on any working day. However, the Fund may temporarily
interest, rights and other payments of whatever kind with respect to            suspend acceptance of fresh applications at any time.
the securities and other assets and items of alike nature of the Fund
held by or to the order of the Custodians and shall execute such                3. Minimum amount of subscription per application
ownership and other confirmations as are necessary. The                         Minimum Rs. 2000/- and in multiples of Rs. 500/- thereafter under
Custodians shall be generally authorized to attend to all non-                  both Plans.
discretionary and procedural details for discharge of normal
custodial functions in connection with the sale, purchase, transfer             4.Systematic Investment Facility (Ongoing Basis only) :
and other assets held for the account of the fund by the Custodians
                                                                                Minimum amount of subscription for application through this facility
as an Agent except as may otherwise be directed by the Fund. For
their services, the Custodians shall be paid a custodial fee as agreed          would be Rs. 3000/- (i.e., Rs. 500/- per month for six months).
upon by the AMC and the Custodians and within the limits given in               5. Maximum amount of subscription per application
the section “Expenses”. The AMC reserves the right to change the
Custodians at any time with the approval of the Board of Trustees               No upper limit.
and the Board of Directors of the AMC.
                                                                                6. Allotment
9. Auditors
                                                                                On an ongoing basis, the number of magnums issued to the
                                .
SBIMF has appointed M/s P C. Hansotia & Co., Jehangir Wadia                     magnum holder may be in fractions. An account statement will be
Building, 3rd floor, 51, M.g. Road, Mumbai - 400 023, as the auditors           issued and will be updated as and when repurchase/reissue is
to the scheme. The Board of Trustees of SBIMF shall review the
                                                                                undertaken in an account. Despatch of magnum statement of account
appointment of auditors after every two years or at such time as
                                                                                will be made as soon as possible but not later than 30 days from
may be deemed fit in the opinion of the Board. The AMC reserves
                                                                                the date of receipt of application.
the right to change the Auditors at any time with the approval of the
Board of Trustees and the Board of Directors of the AMC.                        Provided that if an applicant so desires, the Asset Management
                                                                                Company shall issue the magnum certificates to the applicant within
10. Collecting Banker(s)
                                                                                6 weeks of the receipt of request for the same.
SBIMF will utilize the services of State Bank of India as the principal
                                                                                Reissue may be discontinued if the Trustees feel that increase in the
collecting banker (SEBI registration no. INBI00000038) for the
Scheme. Please note that the AMC may utilize the services of                    size of the fund would be detrimental to the interest of existing
branches of the SBI Group or any other bank as authorized collecting            investors. Application for reissue of magnums will not be binding
branches for the scheme. This has also been mentioned under the                 on the fund and may be rejected.
section “Associate Transactions”. The branches will be paid                     7. Date of commencement of the scheme
handling charges as per the prevailing market rates and/or as
negotiated with them. For applications directly solicited and                   1st December, 1998
collected by the branches of SBI or its associates, they may also be
paid an agent commission at a rate not exceeding the rate of                    8. Winding up of Scheme
commission being paid to other agents for the Scheme.                           The duration of the scheme is perpetual. However, the Trustees
                                                                                reserve the right to terminate the Scheme at any time if the corpus
                    XI. UNITS AND OFFER                                         of the Scheme falls below Rs. 1 crore.
                                                                                Regulation 39(2) of the SEBI Regulations provides that any scheme
1. Issue Price                                                                  of a mutual fund may be wound up after repaying the amount due
Rs. 10/- per Magnum for cash at par.                                            to the unitholders :
                                                                                (a) on the happening of any event which, in the opinion of the
On an ongoing basis magnums under the scheme will be offered
                                                                                      Trustees, requires the scheme to be wound up; or
for sale on any working day at a NAV related Public Offering Price
(POP). The number of units allotted will be equal to the amount                 (b) if 75% of the unitholders of a scheme pass a resolution that
invested divided by the prospective POP for the same working day                      the scheme be wound up; or
for applications received at the collection centres before 2 p.m.               (c) if SEBI so directs in the interest of the unit holders.
and prospective POP of next working day for applications received               Where a scheme is wound up under the above Regulation, the
at the collection centres after 2 p.m., viz. for an application received        trustees shall give a notice disclosing the circumstances leading to
on Tuesday after 2 p.m. the POP will be the closing NAV, with an                the winding up of the scheme :
appropriate discount, of Wednesday. Applications received by                    (a) to SEBI; and
post will be deemed to have been submitted on date of receipt at
the registrar’s end.                                                            (b) in two daily newspapers having circulation all over India & a
                                                                                      vernacular newspaper circulating at the place where the mutual
POP : The POP is based on the applicable NAV and it includes the                      fund is formed.


                                                                           23
MAGNUM LIQUIBOND INCOME FUND
In case of termination of the scheme, the Trustees shall proceed as            mail should be directly mailed to the Registrars and must be
follows :                                                                      accompanied by a Demand Draft payable at SBI, Mumbai, Main
                                                                               Branch (Code: 0300).
From the proceeds of the assets of the scheme, the Trustees shall
first discharge all liabilities of the scheme and make provision for           All investors may make the cheque/D.D. for the application amount
meeting the expenses of the winding-up of the scheme, including                payable to “SBIMF- Magnum LiquiBond Income Fund – Dividend
the fees of the AMC. The Trustees shall distribute the proceeds to             Option” or “SBIMF- Magnum LiquiBond Income Fund – Growth
the Magnumholders, in proportion to their respective interest, all             Option” and crossed ‘Account Payee Only’.
proceeds derived from the realisation of the investments, after
                                                                               Procedure for NRIs: Applications on a repatriable basis will be
recovering all costs, charges, expenses, claims, liabilities, whether
                                                                               made by remitting funds from abroad through normal banking
actual or contingent, incurred, made or apprehended by the
                                                                               channels or by submitting payments made by demand drafts
Trustees in connection with or arising out of the termination of the
                                                                               purchased from FCNR accounts or by cheques drawn on NRE
scheme.
                                                                               accounts or through Special Non-resident Rupee Accounts
9. Jurisdiction                                                                maintained with banks authorized to deal in foreign exchange in
                                                                               India. NRI applicants are requested to instruct the bank branch
The jurisdiction for any matters or disputes arising out of the scheme         through which they have made the remittance or where they have
shall reside with the Courts in India.                                         the NRE / FCNR / Special Non-resident Rupee Account to send the
                                                                               necessary FIRCs in original on security paper to the registrars as
10. Power to Make Rules                                                        soon as possible to enable early processing of their applications.
The Trustees may from time to time, with prior approval of SEBI,               A copy of these instructions to the bank may also be enclosed
prescribe such terms or make such rules for the purpose of giving              along with the application to expedite the follow-up by the registrars.
effect to the provisions of this scheme with power to the AMC to               Procedure for OCBs / FIIs : The scheme is open for investment to
add to, alter or amend all or any of the terms or rules that may be            OCBs and FIIs on full repatriation basis. Overseas Corporate Bodies,
framed from time to time. However, any alteration amounting to a               firms and societies which are held directly or indirectly but
change in fundamental attributes of the scheme shall be made only              ultimately to the extent of at least 60% by non-resident individuals
after obtaining the approval of magnumholders in accordance                    of Indian nationality or origin, and trusts in which at least 60% of the
with SEBI Regulations as stated elsewhere in the offer document.               beneficial interest is similarly held irrevocably by such persons are
                                                                               also eligible to invest in the Scheme. Such investors may enclose
11. Power to remove difficulties                                               bank certificate(s) and certificate in original from Overseas Auditors
In case of any difficulty in giving effect to the provisions of the            on form OAC/ OAC-I in respect of their investment in the Scheme.
scheme, the Trustees may do anything not inconsistent with such                All investors may make the cheque/D.D. for the application amount
provisions, which appears to them to be necessary, desirable or                payable to the Scheme as specified in the application form. The
expedient, for the purpose of removing such difficulty.                        investors are advised to fill up the details of their bank account
                                                                               numbers on the application form in the space provided. Please
12. Scheme to be binding                                                       refer to the para “Bank Account Numbers” later in this section.
The Trustees may, from time to time, add to or otherwise vary or               Investors can also opt for Electronic Credit Clearing System (ECS)
alter all or any of the features or terms of the scheme, with prior            facility and receive direct credit of their dividend or redemption
approval of SEBI and the Magnum holders in accordance with                     proceeds (if the amounts are below Rs. 1 lakh) into their bank
SEBI Regulations, and the same shall be binding on each Magnum                 accounts.
holder and any person(s) claiming through or under it, as if each              Investors are advised to retain the acknowledgement slip signed/
Magnum holder or such person(s) expressly agreed that such                     stamped by the collection centre where they submit the application.
features or terms should be so binding.
                                                                               2. Systematic Investment Facility
                      XII. SALE OF UNITS
                                                                               For individual investors, the fund offers a Systematic Investment
1. How to apply                                                                Facility at the Investor Service Centres under both the Plans. Under
                                                                               this Facility, an investor can invest a fixed amount every month for
Applications complete in all respects together with necessary                  six months or one year through post-dated cheques at applicable
remittance may be submitted at the SBIFM Investor Service Centres,             NAV-related prices. This facility will help the investor to average
Registrar’s office, SBI MF Corporate Office or such other collection           out their cost of investment over a period of six months or one year
centres as may be designated by the AMC. The number of units                   and thus overcome the short-term fluctuations in the market.
allotted will be equal to the amount invested divided by the POP      ,        Investors must indicate their choice on their application form in the
for application received till 2.00 p.m. For application received               box provided for the purpose. The post-dated cheques must be
after 2.00 p.m. the next day’s POP shall be considered for allotment           dated the 5th of every month and drawn in favour of the Scheme as
of units. Applications received by post will be considered at the              specified in the application form and crossed “Account Payee Only”.
POP of date of receipt at the centre. No outstation cheques or                 The cheques maybe drawn on a local branch of a Bank where the
stockinvests will be accepted. For valid applications made through             Investor Service Centre is located and may be submitted at the
outstation drafts (i.e. at such locations where there is no authorized         Investor Service Centre. The amount will be invested in the Scheme
collecting branch for the issue of the scheme) payable at a collecting         at the closing NAV of the date of realisation of the cheque. The
branch where the application is deposited. In such case, the draft             number of Magnums allotted to the investor will be equal to the
charges as per guidelines of Indian Banks Association may be                   amount invested during the month divided by the POP for that day.
deducted upfront from the application amount. Applications by                  An intimation of the allotment will be sent to the investor. The


                                                                          24
MAGNUM LIQUIBOND INCOME FUND
facility may be terminated by the investor after giving at least three           requests. Investors are requested to provide these details in the
weeks’ written notice to the Registrar.                                          space provided in the application form. This measure is intended
For all payments made by cheques, the date of realization of a                   to avoid fraud / misuse or theft of warrants in transit. Kindly note
cheque will be taken as the date of investment and the amount                    that applications not containing these details may be rejected.
invested will be deemed to be the amount realized net of bank                    Investors also have the option of receiving their redemption
charges (if any).                                                                proceeds upto Rs. 1 lakh through ECS facility, wherever such a
                                                                                 facility is available. Further details of this facility are given in section
3. Systematic Withdrawal Plan (SWP) facility                                     “Returns and Distribution”.
            ,
Under SWP a minimum of Rs. 500 can be withdrawn every month
                                                                                 7. Permanent Account Number (PAN)
or quarter by indicating in the application form or by issuing advance
instructions to the Registrars at any time. SWP is available under               Applicant’s PAN / GIR Number and I.T. Circle / Ward / District (if
the Growth Plan only.                                                            available) are to be mentioned if the amount invested is Rs. 50,000/
                                                                                 - or more. In case the applicant is not allotted a PAN / GIR No.,
The payment will be made through post-dated cheques subject to
                                                                                 please state “Not Allotted”.
a balance of 25% of the net assets in the investment account. Such
post-dated cheques will be issued for six months at a time (or two
                                                                                           XIII. DIVIDENDS AND DISTRIBUTION
quarters). SWP entails redemption of certain number of Magnums
that represents the amount withdrawn. Gains through SWP will be
treated as capital gains for tax purposes.                                       1. Returns to the Investors
                                                                                 Under the Growth Plan, no dividends will be distributed. The returns
4. Who can invest                                                                to investors will be through capital gains at the time they choose to
(A) The following categories of Indian nationals are eligible to                 repurchase any or all of their holdings. Investors may refer to the
invest in the scheme: (i) Adult individuals. (ii) Adult individuals, not         next section “Redemption and Repurchase” for further information.
exceeding three, either - jointly, or - on either/any one or survivor            Under the Dividend Plan, the returns will be distributed through
basis, or - on first holder or survivor basis. (iii) Minors through their
                                                                                 declaration of dividends on a semi annual basis at the discretion of
parents/step parents/guardians (applications of minors jointly with
                                                                                 the fund manager. The rate of dividend will be decided by the Fund
adults not allowed). (iv) Hindu Undivided Family (HUF) in the name
of karta. (v) Companies/Bodies corporate/PSUs/Banks/Financial                    Manager with the approval of the Board of Trustees. Although the
Institutions registered in India. Applications by above should be                Scheme will strive to declare a regular dividend, the declaration of
accompanied by their Memorandum/Articles of Association, and                     dividends and the percentage to be distributed will depend upon
a copy of the Resolution authorising the investment, and list of                 the NAV at that time, and no returns are assured.
authorised signatories with specimen signatures. (vi) Religious/
Charitable/Other Trusts, wakfs and societies registered under the                2. Mode of Distribution
applicable laws and authorised to invest in mutual funds.                        The dividends will be distributed to the investors under the Dividend
Applications by above should be accompanied by their Trust Deed,                 Plan through warrants mailed to them within 30 days of declaration
certified copy of the Board Resolution authorising the investment,               of dividends. Investors residing in such places where Electronic
and list of authorised signatories with specimen signatures. (vii)
                                                                                 Clearing Facility is available will have the option of receiving their
Partnership firms. (viii) An association of persons or body of
                                                                                 dividend directly into their specified bank account through ECS. In
individuals, in either case, consisting only of husband and wife,
governed by the system of community of property in force in the                  such a case, only an advice of such a credit will be mailed to the
state of Goa and the Union Territory of Dadra, Nagar Haveli, Daman               investors.
& Diu. (ix) Army/Air force/Navy/Paramilitary funds and other eligible
                                                                                 3. Electronic Credit Clearing Service (ECS)
institutions.
(B) Non-Resident Indians (NRIs), FIIs and Overseas Corporate Bodies              ECS is a facility offered by the Reserve Bank of India for facilitating
can invest on fully repatriable basis. NRIs can also apply on a non-             better customer service by direct credit of dividend or redemption
repatriable basis from their NRO Account.                                        amount to an investor’s bank account through electronic credit.
If any application or transfer form is signed by person holding a                This helps in avoiding loss of dividend or redemption warrants in
valid Power of Attorney, the original Power of Attorney or a certified           transit or fraudulent encashment. This facility is optional for the
copy duly notarized should be submitted with the application or                  investors in the Scheme.
the transfer form, as the case may be, unless the Power of Attorney              Dividends or redemption proceeds may be distributed through
has already been registered in the books maintained by the Board                 the ECS facility to investors residing in any of the cities where such
of Trustees.                                                                     a facility is available. Payments of upto Rs.1,00,000/- per transaction
5. Defective applications liable for rejection                                   can be made through the ECS.

Applications not complete in any respect are liable to be rejected.              All investors will have to provide the additional details required in
In the event of non-allotment of Magnums, no interest will be paid               the space provided on the application form. If they have also opted
on the money refunded. In case of any representation to the Trustees             for the ECS facility, their bank branch will directly credit the amount
against the disqualification of any application, the decision of the             due to them to their account wherever the payment is through ECS.
Trustees will be final.                                                          The Registrars will send a separate advice to the investors informing
                                                                                 them of the direct credit.
6. Bank Account Numbers                                                          The ECS facility will be offered by the Fund in any centre only if
SEBI has made it mandatory for investors in mutual funds to state                there is sufficient demand for the facility. In places where such a
their bank account numbers in their applications and in redemption               facility is not available or if the facility is discontinued by the Scheme


                                                                            25
MAGNUM LIQUIBOND INCOME FUND
for any reason, or in cases where the dividends or redemption                   subscribed to some of the issues lead managed by SBI Capital
proceeds exceed Rs. one lakh, the dividend / redemption warrants                Markets Ltd. The details of these are as follows:
will be mailed to the investors.
                                                                                 Name of the            Type           Quantity    Quantity   Amount
                                                                                 Company                               Applied     Allotted (Rs. Lakhs)
               XIV. INTER-SCHEME TRANSFERS
                                                                                 Corporation Bank       Equity (PP)   2000000       98000        78.40
1. Policy on Inter-scheme Transfers                                              ICICI Banking
The Scheme, or any other scheme of the Mutual Fund, may make                     Corporation            Equity        4150000      525500      183.92
investments or effect a sale of some of its investments by means of              Gujarat Gas
transfers from one scheme to another in the same mutual fund.                    Company Ltd.           Debentures          20          20     200.00
Such transfers will be done in accordance with clause 3 of seventh
                                                                                 Krishna Baghya
schedule to SEBI Regulations and subject to the following
                                                                                 Jala Nigam Ltd.        Debentures         500         500     500.00
conditions :
                                                                                 National Aluminum
i)     such transfers are done at the prevailing market price for
                                                                                 Co. Ltd.               Debentures     500000      450000     4500.00
       quoted instruments on spot basis. (Where such a spot price is
       not available or if the market is closed, the inter-scheme                Deepak Fertilizers     Debentures         500         500     500.00
       transfer may be done at the latest closing price available).
                                                                                 State Bank of
ii)    the securities so transferred would be in accordance with the             Bikaner & Jaipur       Equity          30000         5595       30.21
       investment objective of the transferee scheme.
                                                                                 TOTAL                                                        5992.53
iii)   the registration and accounting of the transaction is effected           However, these investments may or may not stand in the books of
       on a spot basis so that the NAV of the Scheme is impacted,               concerned schemes at present.
       and the transaction is ratified in the next meeting of the
                                                                                5. Associate Broker
       Trustees.
                                                                                At present, SBI Mutual Fund has no transactions with any associate
               XV. ASSOCIATE TRANSACTIONS                                       broker in any of its schemes.
                                                                                6. Collecting Banker(s) and Distributors
1. Who is an associate?                                                         SBIMF will utilize the services of State Bank of India as the collecting
For the purpose of this section, an associate or group company                  banker for the scheme.
shall include State Bank of India (SBI), its subsidiaries (including the        7. Collecting Branches
AMC), joint ventures and the associate banks of SBI.                            The AMC may utilize the services of some branches of the SBI
                                                                                Group as authorized collecting branches for the scheme. The list of
2. Investments in Associate or Group Companies of the                           collecting branches will be printed in the application form. They
Sponsor                                                                         will be paid handling charges at such a rate as may be prevalent in
                                                                                the market at the time of the issue and/or as negotiated with the
As per SEBI Regulation, the scheme will not invest more than 25%                concerned banks.
of net assets of the scheme in the securities of the State Bank Group
                                                                                8. Agent Commission
companies. Further, the aggregate investment made by all the SBI
Mutual Fund schemes in the securities of State Bank Group                       For applications directly solicited and collected by the branches
companies will not exceed 25% of the net assets of the fund as a                of SBI or by any associates, they may also be paid an agent
whole. No investment shall be made in any unlisted security of an               commission at a rate not exceeding the rate of commission being
associate or group company of the Sponsor, any security issued                  paid to other agents for the scheme.
by way of private placement by an associate or group company of                 9. Other Associate Transactions
the Sponsor.                                                                    Individual schemes of SBI Mutual Fund lend in the Call Money
          st                                                                    Market from time to time in order to continuously earn returns on
As on 31 March 2001, all the schemes of the Mutual Fund have Rs.
                                                                                their short-term surplus cash. This is in accordance with the
18.13 crores invested in the various equity instruments of State                applicable Regulations. SBI, SBI Commercial & International Bank,
Bank Group Companies. The scheme shall not invest in privately                  any of SBI’s associate banks or SBI Gilts Ltd. may be some of the
placed or unlisted securities of associates / group companies.                  players who may borrow from SBI Mutual Fund at market rates.
3. Underwriting Obligations of SBI Mutual Fund                                  SBI or any associates of SBI (including SBI Capital Markets, SBI
                                                                                Gilts Ltd. and/or SBI Securities Ltd.) may be entrusted the work of
As on date, SBIMF has no underwriting obligations.                              marketing, book-building, distribution or any other activity
                                                                                connected with the scheme or any other schemes of SBI Mutual
4. Subscription in Issues Lead Managed by Associates of                         Fund, as may be allowed by SEBI or any other competent authority,
Sponsor                                                                         and within the relevant provisions of Regulations prevailing from
                                                                                time to time. SBI Capital Markets was appointed as the Principal
In the last three fiscal years, different schemes of the Fund have              Marketing Advisors for Magnum Gilt Fund.




                                                                           26
MAGNUM LIQUIBOND INCOME FUND
                                            XVI. BORROWING BY THE MUTUAL FUND

1. Borrowing by the Scheme
The scheme may borrow upto 20% of the net assets managed for a maximum tenure of 6 months for the purpose of meeting outflows on
account of repurchase / redemption or dividend payments.
In terms of Regulation 44(2) of SEBI (MF) Regulations, 1996:
“ The mutual fund shall not borrow except to meet temporary liquidity needs of the mutual fund for the purpose of repurchase, redemption
of units or payment of interest or dividend to the unit holders.
provided that the mutual fund shall not borrow more than 20% of the net assets of the scheme and the duration of such a borrowing shall
not exceed a period of six months.”
If the scheme decides to borrow, it may borrow either from SBI Group banks and / or any other bank(s) or from any other sources as may
be decided by the AMC. The loans may be without collateral or may consider using a part of the Scheme’s assets as collateral with the
prior approval of the Board of Directors of the AMC and the Board of Trustees of the Scheme.
The following table provides the details of borrowings by other schemes during the last fiscal year (01.04.2000 – 31.03.2001)
     Scheme                    Amount               Date of           Amounts             Date of          Purpose of       Amount as
     Name                     Borrowed           Borrowing             Repaid          Repayment           Borrowing        % of NAV at
                                                                                                                             the time of
                                                                                                                             borrowing
     Magnum GIFTS - A           9,04,000         23/08/2000           21,51,000           8/9/2000         Funding of            0.00263
                               12,47,000         26/08/2000                                              Repurchases
                                                                                                                 A/c.

2. Potential Risk of Loss to the AMC / Magnum holders
The borrowing by the Scheme will not involve any potential loss to the AMC or to the Magnumholder. However, it will involve a certain
cost on account of interest paid on borrowing at market rates as may be negotiated with the concerned lender. In any case, the Scheme
may resort to borrowings only if the possible benefit from borrowings exceeds the cost of immediate liquidation of its assets for meeting
redemption / repurchase needs.

                                  XVII. NAV AND VALUATION OF ASSETS OF THE SCHEME

1. Valuation of Assets pertaining to the scheme
Valuation of Assets, computation of NAV, repurchase price and their frequency of disclosure will be in accordance with the provisions of
SEBI (MF) Regulations 1996/Guidelines/Directives issued by SEBI from time to time. The assets of the scheme will be valued based on the
following valuation norms.
A.     Traded Securities
       a)     The securities shall be valued at the last quoted price on the stock exchange.
       b)     When the securities are traded on more than one recognized stock exchange, the securities shall be valued at the last quoted
              closing price on the stock exchange where the security is principally traded. It would be left to the Asset Management
              Company to select the appropriate stock exchange, but the reasons for the selection should be recorded in writing. There
              should however be no objection for all scrips being valued at the prices quoted on the stock exchange where a majority in
              value of the investments are principally traded.
       c)     Once a stock exchange has been selected for valuation of a particular security, reasons for change of the exchange shall be
              recorded in writing by the Asset Management Company.
       d)     When on a particular valuation day, a security has not been traded on the selected stock exchange, the value at which it is
              traded on another stock exchange may be used.
       e)     When a security is not traded on any stock exchange on a particular valuation day, the value at which it was traded on the
              selected stock exchange or any other stock exchange, as the case may be, on the earliest previous day may be used provide
              such date is not more than thirty days prior to the valuation date.
B.     Thinly Traded Debt Securities
       A debt security (other than Government Securities) that has a trading volume of less than Rs. 15 crores for a period of 30 days prior
       to the valuation date shall be considered as a thinly traded security based upon information provided by the relevant stock exchange
       on the volume of debt securities traded.
       A thinly traded debt security as defined above would be valued as per the norms set for non-traded debt security.



                                                                     27
MAGNUM LIQUIBOND INCOME FUND
C.   Non-Traded Securities                                                      stock exchange and the primary market issuances. The matrix is
                                                                                restricted only to investment grade corporate paper.
     When a security is not traded on any stock exchange for a
     period of thirty days prior to the valuations date, the scrip              Step C
     must be treated as a ‘non-traded’ scrip.
                                                                                The yields as calculated above are Marked-up/Marked-down for
D.   Valuation of Non-traded/Thinly traded securities                           ill-liquidity risk
     (i)   (a)   Non Traded /Thinly Traded Debt Securities of upto
                 182 Days to Maturity:                                          Step D
                 As the money market securities are valued on the               The Yields so arrived are used to price the portfolio
                 basis of amortization (cost plus accrued interest till         E.    Valuation of securities with Put/Call Options
                 the beginning of the day plus the difference between
                 the redemption value and the cost spread uniformly             The option embedded securities would be valued as follows:
                 over the remaining maturity period of the instruments)         a.    Securities with call option:
                 a similar process should be adopted for non-traded
                 debt securities with residual maturity of upto 182                   The securities with call option shall be valued at the lower of
                 days, in the absence of any other standard                           the value as obtained by valuing the security to final maturity
                 benchmarks in the market. Debt securities purchased                  and valuing the security to call option.
                 with residual maturity of upto 182 days are to be                    In case there are multiple call options, the lowest value obtained
                 valued at cost (including accrued interest till the                  by valuing to the various call dates and valuing to the maturity
                 beginning of the day) plus the difference between                    date is to be taken as the value of the instrument.
                 the redemption value (inclusive of interest) and cost
                                                                                b.    Securities with Put option
                 spread uniformly over the remaining maturity period
                 of the instrument. In case of a debt security with                   The securities with put option shall be valued at the higher of
                 maturity greater than 182 days at the time of purchase,              the value as obtained by valuing the security to final maturity
                 the last valuation price plus accrued interest should                and valuing the security to put option
                 be used instead of purchase cost. All other non traded               In case there are multiple put options, the highest value
                 Non Government debt instruments shall be valued                      obtained by valuing to the various put dates and valuing to
                 using the method suggested in (ii)(b) hereof”                        the maturity date is to be taken as the value of the instruments.
     (i)   (b) Non Traded/ Thinly Traded Debt Securities of Over                c.    Securities with both Put and Call option on the same day
               182 Days to Maturity:
                                                                                      The securities with both Put and Call option on the same day
For the purpose of valuation, all Non Traded Debt Securities would                    would be deemed to mature on the Put/Call day and would
be classified into “Investment grade” and “Non Investment grade”                      be valued accordingly.
securities based on their credit ratings. The non-investment grade
securities would further be classified as “Performing” and “Non                      (i)    (c)   Government securities (not traded for more than 30
Performing” assets                                                                                days or one which would qualify as a thinly traded
                                                                                                  security) shall be valued at yield to maturity based
All Non Government investment grade debt securities, classified                                   on the prevailing market rate, in accordance with
as not traded, shall be valued on yield to maturity basis as described                            item (cc) of Clause 2 of the Eighth Schedule of SEBI
below.                                                                                            (Mutual Funds) Regulations, 1996.
All Non Government non-investment grade performing debt                         F.    Illiquid Securities:
securities would be valued at a discount of 25% to the face value
                                                                                      (a)     Aggregate value of “illiquid securities” of scheme,
All Non Government non-investment grade non performing debt                                   which are defined as non-traded, thinly traded and
securities would be valued based on the provisioning norms.                                   unlisted equity shares, shall not exceed 15% of the total
The approach in valuation of non traded debt securities will be                               assets of the scheme and any illiquid securities held
based on the concept of using spreads over the benchmark rate to                              above 15% of the total assets shall be assigned zero
arrive at the yields for pricing the non traded security.                                     value.
The Yields for pricing the non traded debt security would be arrived                  (b)     The Mutual fund will disclose as on March 31 and
at using the process as defined below.                                                        September 30, the scheme-wise total illiquid securities
                                                                                              in value and percentage of the net assets while making
Step A                                                                                        disclosures of half yearly portfolios to the Magnum
                                                                                              holders. In the list of investments, an asterisk mark shall
A Risk Free Benchmark Yield is built using the government securities
                                                                                              also be given against all such investments, which are
(GOI Sec) as the base. GOI Secs are used as the benchmarks as they
                                                                                              recognized as illiquid securities.
are traded regularly; free of credit risk; and traded across different
maturity spectrums every week.                                                  2. Determination of Net Asset Value
Step B                                                                          The value determined as above, will be adjusted for the following:
A Matrix of spreads (based on the credit risk) are built for marking            a)    all income and expenditure accrued.
up the benchmark yields. The matrix is built based on traded                    b)    major expenses like management fees and other periodic
corporate paper on the wholesale debt segment of an appropriate                       expenses to accrue on a day to day basis.


                                                                           28
MAGNUM LIQUIBOND INCOME FUND
c)   The basis for calculation of NAV will be subject to regulations           3. How to Repurchase
     and guidelines of the SEBI issued from time to time.
                                                                               The application for repurchase can be made on a pre-printed
Minor expenses, if any, will not be accrued on a day to day basis if           repurchase application form sent along with the Magnum
they do not affect the NAV by more than 1%.                                    Statement of Account mailed to the investor. In this connection,
The Mutual Fund shall comply with the investment valuation norms               the repurchase applications along with the Magnum certificates (if
spelt out in the Eighth Schedule of SEBI Regulations.                          any) should be submitted to the Registrars/ISCs/SBI MF Corporate
                                                                               Office.
The Net Asset Value per Magnum shall be calculated by dividing
the Net Assets of the scheme by the total number of Magnums                    For applications made on either / anyone or survivor basis, only
outstanding on the valuation date, as follows:                                 one of the holders needs to sign on the repurchase application.
                                                                               However, the repurchase warrant will normally be issued in the
          Total unit capital + Reserves + Income (net of expenses)             name of the first holder only.
       + Appreciation / -depreciation in investments                           A complete list of the ISCs is given in the section ‘Investors’ Rights
NAV = ——————————————————————————                                               & Services’. SBIMF may appoint additional centres for acceptance
          Total no. of Magnums outstanding                                     of applications, if required.
Any changes in securities and in the number of units will be
recorded in the books not later than the first valuation date following        4. Repurchase Schedule and Service Standards
the date of transaction. If this is not possible given the frequency of        In accordance with sub clause (c) of Regulation 53 of the SEBI
the NAV disclosure, the recording may be delayed upto a period                 (Mutual Funds) Regulations, 1996, in the event of failure to despatch
of seven days following the date of the transaction, provided that             the redemption or repurchase proceeds within the period specified
as a result of the non-recording, the NAV calculations shall not be            in sub-clause (b) of the said regulation i.e 10 working days, asset
affected by more than 2%.                                                      management company is liable to pay interest to the unitholders at
The NAV will be calculated every day and will be published atleast             such rate as may be specified by SEBI. Such interest is required to
in two daily newspapers at such intervals as are prescribed by                 be borne by the Asset Management Company (AMC). The interest
SEBI.                                                                          for the period of delay in despatch of redemption or repurchase
                                                                               proceeds, would presently be paid to the unitholders @ 15% per
        XVIII. REDEMPTION AND REPURCHASE                                       annum.
                                                                               The redemption will be permitted to the extent of credit balance in
1. Repurchase facility                                                         the Magnumholders account. The repurchase warrant will normally
Repurchase facility will be available to the investor on an ongoing            be despatched to the investor within 3 business days from the date
basis. For applications received at the Registrar’s Office/SBIMF               of repurchase.
Investor Service Centres/ SBIMF Corporate Office before 2 p.m.,
the repurchase price will be based on the closing NAV of the same              5. Right to Limit Redemptions
day and for applications received at the registrar’s end after 2 p.m.,         In an open ended fund, any disruption in the normal functioning of
the repurchase price will be calculated based on the closing NAV
                                                                               the markets for debt instruments or extreme illiquidity in any of the
of the next working day. e.g. for an application received on Tuesday
                                                                               debt instruments held by the Scheme may affect the ability of the
before 2 p.m. the repurchase price will be calculated based on
                                                                               fund manager to buy or sell freely in the market. The fund shall
Tuesday’s closing NAV and for a repurchase application received
on Tuesday after 2 p.m., the repurchase price will be based on the             strive to maintain an adequate & desirable level of liquidity for both
the closing NAV of Wednesday, with an appropriate exit load, if                the Plans. However, in the event of an inordinately large number of
applicable. Applications received by post will be deemed to have               redemption requests or of restructuring of the Scheme’s portfolio,
been submitted on date of receipt at the registrar’s end.                      the time taken by the Fund for redemption of Magnums may become
                                                                               significant.
The repurchase price for the above will be based on the closing
NAV of the day and it will incorporate the applicable repurchase               The fund reserves the right to limit repurchases to 5% of the units
load. In case the offices of the AMC or the registrars or the Banks            issued per day for the fund as a whole. In case such a limit is
are closed for any reason the repurchase date will be taken as the             imposed on any day, Magnums will be redeemed on a pro-rata
date of the next working day.                                                  basis in proportion to the total amount of redemption sought per
                                                                               folio on that day. Any Magnums which are not redeemed due to
2. Minimum Amount of Repurchase per Application
                                                                               this limitation will be carried forward to the next day and redeemed
The minimum amount of redemption would be equivalent of 100                    at the applicable repurchase price in the order of receipt. This limit
magnums or Rs 1000/-, whichever is lower. If as a result of repurchase         may be changed from time to time.
the balance in the account of an investor falls below Rs. 2000/- or
200 Magnums, whichever is lower, the fund will reserve the right to            This limit is not expected to be enforced in general, and may be
compulsorily redeem the account completely at applicable                       enforced only when any redemptions above the limit are prejudicial
repurchase price, after giving him 30 days’ notice requesting him              to the interest of the investors or in case of lack of sufficient liquidity
to enhance the balance by making fresh investments.                            in the debt market.




                                                                          29
MAGNUM LIQUIBOND INCOME FUND
The Mutual Fund also reserves the right to temporarily suspend                 9. Redemption Record
further issues or repurchases under the Scheme in case of any of
the following :                                                                Till date SBI Mutual Fund has redeemed 11 schemes. The
                                                                               redemption details for these schemes are given below:
—    a natural calamity or
                                                                                    Scheme               Redeemed on                Compounded
—    in case of conditions leading to a breakdown of the normal                                                                       Annualized
     functioning of securities markets or                                                                                             Yield (p.a.)
—    periods of extreme volatility or illiquidity
                                                                                MRIS 87                  30th June 1993                    15.26%
—     under a SEBI directive
                                                                                MTSS 88-89               31st Mar 1994                     21.89%
—    under a SEBI or Government directive
                                                                                MRIS 89                  31st Mar 1994                    15.73%
—    under a court decree / directive
                                                                                MTSS 90                  31st Mar 1995                     15.38%
6. Switchover facility
                                                                                MRIS 90                  31st July 1995                    11.46%
The investor in any of the Plans under the scheme will have the
option of switching over to the other Plan at NAV. Investors also               MMIS 89                  31st Dec 1996                     13.99%
have the facility of switchover to some other open-ended funds of
SBI Mutual Fund such as Magnum Balanced Fund, Magnum                            MEX 91                   19th Nov 1997                      2.60%
Multiplier Plus ‘93, Magnum Equity Fund, Magnum Gilt Fund,                                                  th
                                                                                MTPL 91                  19 May 1999                       15.78%
Magnum Monthly Income Plan, Magnum InstaCash Fund, Magnum
TaxGain Scheme and Magnum Sector Funds Umbrella at NAV                          MBF                         st
                                                                                                         31 Jan 2000                       17.17%
related prices or any other schemes of the Mutual Fund as may be
announced from time to time. The terms of switchover may change                     MMIS 91              30th June 2000                    14.13%
from time to time. Investors may contact the nearest ISC for further
                                                                                MELS 91                  31st March 2001                   12.30%
details on switchover facility.
At the time of switchover, the investors will be required to surrender         However, please note that past performance is not necessarily
their Magnum certificates, if any have been issued.                            indicative of the future results.

The facility of switchover is not available to NRIs/OCBs/FIIs.                 10. Extension record
7. Loan facility                                                               The Magnum Monthly Income Scheme 1991 (MMIS’91) has been
                                                                               extended by 3 years from its original redemption on 30.06.1997 to
Magnumholders shall be entitled to obtain a loan against their                 30.06.2000. The extension was done after obtaining an approval
Magnums from any bank, subject to relevant RBI regulations and
                                                                               from SEBI. An option was granted to all the investors to exit, if they
the respective bank’s instructions, by getting a lien registered /
                                                                               so chose, at the assured return price of Rs. 100 per Magnum. Simple
recorded with the Registrars.
                                                                               yield p.a. as on 30.06.1997 was 14.13%.
Magnum holders who have borrowed against their Magnums by
recording a lien against their holding can avail of repurchase facility        Four other equity schemes – Magnum Equity Fund (previously
only after the receipt of instructions from the concerned lender that          known as Magnum Multiplier Scheme 1990 (MMS’90)), Magnum
the loan has been repaid in full and the lien can be discharged. In            Multiplier Plus Scheme 1993 (MMPS’93) and Magnum TaxGain
case such an instruction is not received, the lender can apply for             Scheme 1993 (MTGS (93) , Magnum Global Fund - have also been
redemption in his favour.                                                      converted to open-end schemes w.e.f. 1st January 1998 and 1st
                                                                               April 1998, 11th November 1999 and 1st October 1999 respectively,
NOTE: In case of application made on “Either or Survivor” basis,
                                                                               after giving the existing investors an option to redeem their
signature of either holder will be adequate, for intimating any other
                                                                               Magnums, if they so chose, at NAV related prices.
changes, which subsequently will change the information in
Magnum Statement of Accounts/Magnum Certificates. These                                 XIX. ACCOUNTING POLICIES & STANDARDS
changes may be like Change of Address, Change of Bank Account
No., etc.                                                                      1. Accounting year end
8. Nomination facility                                                         The accounts of the scheme shall be closed every year as on 31st
                                                                               March. The Trustees shall cause the accounts of the scheme to be
Nomination facility is available only for individuals applying on
                                                                               maintained in such form and manner as may be decided by them
their own behalf, either singly or jointly upto three. Applicants can
                                                                               and in accordance with the Mutual Fund Regulations, 1996. The
nominate only one person. This facility is also available to NRI
                                                                               Trustees and the AMC shall, at the close of each half year, i.e., 30th
investors. Minors and NRIs can also be nominated. In case the
                                                                               September and 31st March, publish the financial results of the
nominee is an NRI but the investor is a resident, then the repurchase/
                                                                               scheme, as provided in SEBI(MF) Regulations, 1996.
redemption proceeds will be payable on a non-repatriable basis,
whereas if the investor is also an NRI it will be payable on a fully           2. Other Accounting Policies and Standards
repatriable basis. This will however be subject to change, if any, in
the guideline of RBI/other Regulators. Applicants may change their             a.     For the purposes of the financial statements, mutual fund shall
nomination at any time during the currency of the scheme.                             mark all investments to market.




                                                                          30
MAGNUM LIQUIBOND INCOME FUND
b.   Dividend income earned by the scheme shall be recognized               dissolved after a deduction has been allowed under this scheme,
     on an ex-dividend basis for quoted investments and on the              the first name holder will be in receipt of the amount withdrawn
     date of declaration for unquoted investments.                          and will be deemed to be the assessee.
c.   In respect of all interest-bearing instruments, income will be         2. Tax benefits related to Income Distribution
     accrued on a day to day basis as it is earned.
                                                                            Under Section 10(33) of the Income Tax Act, income from mutual
d.   Average cost method will be followed in determining the
     holding cost of investments and the gains or losses on sale of         fund is fully exempt in the hands of the investors. However, any
     investments.                                                           income distributed by a mutual fund to its magnumholders will be
                                                                            subject to an income tax of 10% (plus applicable surcharge) of
e.   Transactions for sale or purchase of investments will be               such income distributed.
     recognized on the transaction date.
f.   Bonus shares and rights entitlements on investments will be            3. Tax benefits related to Capital Gains
     recognized on the ex-bonus and ex-rights dates respectively.           Tax benefit is available under sections 48 & 112 of the Income Tax
g.   Income accrued on an investment but not received for 12                Act, on capital gains for resident Indians.
     months beyond the due date shall be provided for and no
     further accrual shall be made for income in respect of such an         4. Tax benefits related to Repurchase/ Redemption/ Transfer
     investment.                                                            Magnums held for a period of more than 1 year will be treated as
h.   When the units are sold, an appropriate part of the sale               long-term capital assets and will qualify for taxation at a lower rate
     proceeds will be credited to an equalization account and               as laid down in section 112 of the Income-tax Act, 1961. The investor
     when units are repurchased, an appropriate part will be debited        concerned will be entitled to the benefit of indexation of the cost
     to the equalization account. The net balance on this account           for the purposes of computing capital gains as laid down in section
     will be credited or debited to the revenue account as an               48 of the Income-tax Act, 1961.
     adjustment to the distributable surplus.
                                                                            As “Units” are proposed to be included in the provision to the
i.   The cost of investment acquired or purchased shall include
                                                                            subsection (1) to Section 112 of the Act and hence Magnumholders
     brokerage, stamp duty and any other charge customarily
     included in the broker’s purchase note. In respect of any              can opt for being taxed at 10% (plus applicable surcharge) without
     privately placed debt instruments any front-end discount               the cost inflation index benefit or 20% (plus applicable surcharge)
     offered should be reduced from the cost of the investment.             with the cost inflation index benefit whichever is beneficial.
j.   Underwriting commission, if any, shall be recognized as                The rates of taxation on long-term capital gains as per section 112
     revenue only when there is no devolvement on the scheme.               of the Income-tax Act, 1961 are as follows :
     Otherwise the entire commission received will be reduced                    —      10%* or 20%** for Resident Individuals & HUFs
     from the cost of investment.                                                —      10%* or 20%** for domestic companies.
The Mutual Fund shall comply with the accounting policies and                    —      10%* or 20%** in case of other residents
standards spelt out in the Ninth Schedule of Securities and Exchange
Board of India (Mutual Funds) Regulations, 1996.                                 —      10%* or 20%** for non-residents (not being a company)
                                                                                        and foreign companies
     XX. TAX TREATMENT OF INVESTMENTS IN                                    Note: * indicates without indexation benefit and ** indicates
                MUTUAL FUNDS                                                with indexation benefit
                                                                            The capital gains may be arrived at after adjusting the following
This section give information on various tax benefits available to
                                                                            from the sale consideration:
the Magnumholders.
                                                                            —    Expenditure incurred wholly and exclusively in connection
The provisions mentioned in the following paras are based on                     with such a sale,
the law and practice as on the date of this offer document, i.e.,
the Income-tax Act, 1961 and as amended by the changes                      —    Cost of investments as inflated by the Cost Inflation Index
approved as per the Finance Act 2001.                                            notified by CBDT.

Prospective investors should not treat the contents of this section         There will be no TDS on capital gains for resident investors.
of the offer document as advice relating to legal, taxation,
                                                                            5. Wealth Tax benefits
investment or any other matter and are recommended to consult
their own professional advisors concerning the acquisitions,                Mutual fund units are not considered as “assets” liable to wealth tax
holding or disposal of the Magnums.                                         u/s 2(ea) of the Wealth-tax Act, 1957. Consequently Magnums held
                                                                            under the scheme will not be liable to wealth tax under the Wealth-
1. Tax benefits to magnumholders                                            tax Act, 1957.
All tax benefits will be available only to the Magnum holder or the
                                                                            6. Tax benefits to Religious / Charitable Trusts
first named holder in case the Magnums are held in the names of
more than one person.                                                       Investments in these Magnums by Religious / Charitable Trusts will
Where a partition has taken place among the members of a Hindu              rank as eligible investments and will qualify for tax benefits under
Undivided Family or when an Association of Persons has been                 section 11(5) of the Income Tax Act, 1961.




                                                                       31
MAGNUM LIQUIBOND INCOME FUND
7. Tax benefits to Mutual Fund                                                      the scheme and affects the interest of Magnum holders, shall
                                                                                    not be carried out unless, a written communication about the
a)    As the Mutual Fund has been registered with SEBI under the                    proposed change is sent to each Magnum holder and an
      SEBI Regulations, the entire income of the Fund is exempt                     advertisement is given in one English daily newspaper having
      from income tax under Section 10 (23D) of the Act.                            nationwide circulation as well as in a newspaper published in
                                                                                    the language of the region where the Head Office of the mutual
       XXI. INVESTORS’ RIGHTS AND SERVICES                                          fund is situated; and the Magnum holders are given an option
                                                                                    to exit at the prevailing Net Asset Value without any exit load.
1. Rights of beneficiaries
                                                                             (b)    The Appointment of the AMC for the scheme can be terminated
a)    After closing of the annual accounts, SBI Mutual Fund shall                   by a majority of the Trustees or by not less than 75% of the
      provide for depreciation on investments and also make a                       Magnumholders of the scheme.
      provision for bad and doubtful debts to the satisfaction of its
                                                                             (c)    The dispatch of dividend warrants shall be made within 30
      auditors and shall disclose the method of depreciation in the
                                                                                    days of the declaration of the dividend and dispatch of
      notes to the accounts. After making such provisions the profits
                                                                                    redemption/repurchase proceeds will be made within 10
      of the scheme together with the capital appreciation, if any,
                                                                                    working days from the date of redemption/repurchase.
      may be distributed to the investors either as a dividend payout
      or plough back to the scheme as may be decided by the                  (d)    No amendments to the Trust Deed will be carried out without
      Board of Trustees.                                                            the prior approval of SEBI and the Magnumholders’ approval
                                                                                    would be obtained where it affects the interests of the
b)    SBI Mutual Fund will publish-
                                                                                    magnumholders.
      i)     the schemes’ audited annual accounts or an abridged
                                                                             e)     No change in the controlling interest of the asset management
             summary of the same within six months from the date
                                                                                    company shall be made unless, -
             of closure of the relevant financial year.
                                                                                    i.     prior approval of the trustees and the Board is obtained;
      ii)    six monthly unaudited financial results or an abridged
             summary of the same before the expiry of one month                     ii.    a written communication about the proposed change
             from the close of each half year i.e. on 31st March and                       is sent to each unitholder and an advertisement is given
             on 30th Sept.                                                                 in one English daily newspaper having nationwide
                                                                                           circulation and in a newspaper published in the
      iii)   the scheme portfolio before the expiry of one month
                                                                                           language of the region where the Head Office of the
             from the close of each half year i.e. on 31st March and
                                                                                           mutual fund is situated; and
             on 30th Sept. or send a copy to all unitholders.
                                                                                    iii.   The unitholders are given an option to exit on the
      This will be published in one national English daily newspaper
                                                                                           prevailing Net Asset Value without any exit load.
      and in a Marathi newspaper. The investors have a right to call
      for the above information, including the full annual report, at        3. Documents available for inspection
      the SBI Mutual Fund’s office or its Investors Service Centres
      and if so desired, they can receive a copy of the above                Following documents are available for inspection by investors at
      information on payment of a nominal fee.                               their office of the SBI Funds Management Ltd., 191, Maker Tower E,
                                                                             Cuffe Parade, Mumbai - 400 005:
      The Fund will also issue for publication the NAV and the sale
      and the repurchase prices of this scheme on a daily basis in at        i)     Trust deed
      least two newspapers in accordance with SEBI Regulations.              ii)    Memorandum and Articles of Association of SBI Funds
c)    an abridged schemewise annual report will be mailed to all                    Management Ltd. and the State Bank of India Act &
      the Magnum holders not later than six months from the date                    Regulations.
      of closure of the relevant accounting year, containing also the        iii)   Copy of Annual Reports including Auditors Report of SBI
      details of group company investments.
                                                                             iv)    Scheme Rules and Regulations
d)    The investors have the right to ask the Trustees about any
      information which may have an adverse bearing on their                 v)     Auditors Reports, Audited Annual Accounts & Offer
      investments and the trustees shall be bound to make                           Documents of all the existing schemes of the SBIMF.
      disclosures about such information to the investors.                   vi)    Agreements with Custodians, Registrars & Transfer Agents,
The investors are also advised to see the relevant provisions of the                Bankers, if any.
Indian Trust Act, 1882, in this regard.                                      vii)   Investment Management Agreement with the Trustees.
2. Other significant rights of the Magnumholders                             viii) Securities & Exchange Board (Mutual Fund) Regulations 1996

(a)   The fundamental attributes as defined above or fees and                ix)    Indian Trust Act, 1882.
      expenses payable or any other change which would modify                x)     Consent letters of Auditors and Legal Advisors




                                                                        32
MAGNUM LIQUIBOND INCOME FUND
4. For your convenience and help                                         6.    CHANDIGARH
SBI Mutual Fund has opened 26 Investor Service Centres (ISCs) all                      .
                                                                               Shri D.P Singh,
over the country. The addresses of these ISCs and the name of the              Manager
contact person are given below:                                                C/o SBI LHO,
1.   AHMEDABAD                                                                 1st Floor, Sector 17-B,
                                                                               Chandigarh - 160 017,
     Shri Ajit Phanse,                                                         Tel. (0172) 709728.
     Asst. Vice President
     C/o SBI,                                                            7.    CHENNAI
     Ahmedabad Main Branch,
                                                                               Shri V. Sukumar,
     1st Floor,
                                                                               Manager
     Bhadra,
                                                                               SBI Bldg., 8th Floor,
     Ahmedabad - 380 001,
                                                                               157, Annasalai,
     Tel. (079) 5507442.
                                                                               Chennai - 600 002,
2.   BANGALORE                                                                 Tel. (044) 8523797, 8418061.

     Shri Srinivas Jain                                                  8.    COIMBATORE
     Vice President & Regional Head (South)
                                                                               Shri Rajesh Ramnarayan,
     Shri S.S. Narayanswamy,
                                                                               Asst. Manager,
     Asst. Vice President & ISC Head
                                                                               SBIMF Investor Service Centre
     SBI LHO Bldg,
                                                                               State Bank of India,
     4th Floor,
                                                                               Main Branch, Bank Road,
     65, St. Marks Road,
                                                                               Coimbatore - 641 018.
     Bangalore - 560 001,
                                                                               Tel : (0422) 303863,
     Tel. (080) 2272284, 2993407.
                                                                         9.    ERNAKULAM
3.   BHILAI
                                                                               Shri T. Mohan Kumar,
     Shri A.K. Mitra,
                                                                               Manager
     Manager
                                                                               C/o. SBI Ernakulam South Branch,
     F-7, Uttar Gangotri,
                                                                               28/218, 2nd Floor,
     G.E. Road, Supela,
                                                                               Manorama Junction,
     Bhilai-490 023,
                                                                               Panampilly Nagar, Cochin,
     Tel. (0788) 410955, 273261.
                                                                               Kerala - 682 036,
4.   BHOPAL                                                                    Tel. (0484) 318886.

     Shri V.V.K.Rao,                                                     10.   GOA
     Manager
                                                                               Shri Jyothi Panvelkar
     C/o SBI LHO,
                                                                               Sr. Marketing Executive
     Hoshangabad Road,
                                                                               203, Kamat Centre,
     Bhopal - 462 011,
                                                                               Opp. Neptune Hotel,
     Tel. (0755) 557341
                                                                               Panjim, Goa
5.   BHUBANESHWAR                                                              Tel. 9822165259

     Shri N.Tripathi,                                                    11.   GUWAHATI
     Asst. Vice President
                                                                               Shri Utpal Baruah,
     Ground Floor,
                                                                               Manager
     SBI LHO Bldg.,
                                                                               C/o SBI Local Head Office
     Pt. Jawaharlal Nehru Marg,
                                                                               (Applo Bldg. Annex),
     Janpath,
                                                                               Bharalumukh,
     Bhubaneshwar - 751 001,
                                                                               Guwahati - 781 009.
     Tel. (0674) 402401.
                                                                               Tel. (0361) 521993.




                                                                    33
MAGNUM LIQUIBOND INCOME FUND
12.   HYDERABAD                                          18.   MANGALORE
      Shri A. Subramanyam,                                     Shri Ashok Kumar,
      Asst. Vice President                                     Deputy Manager
      C/o SBI LHO, 6th Floor,                                  C/o SBI, Arya Samaj Road,
      Koti,                                                    Bellamatta,
      Hyderabad - 500 195,                                     Mangalore - 575 003,
      Tel. (040) 4756241.                                      Tel. (0824) 445892.

13.   INDORE                                             19.   MUMBAI
      Shri Ujjwal Sharma,                                      Shri Santanu Ray,
      Sr. Marketing Executive,                                 Deputy Manager
      SBI Mutual Fund,                                         42, Rajgir Chambers,
      C/o. State Bank of India,                                5th Floor,
      Main Branch,                                             Saheed Bhagat Singh Road,
      Near GPO,                                                Fort, Mumbai - 400 023.
      Indore - 452001,                                         Tel. (022) 2658302, 2658303.
      Tel. (0731) 7000189.
                                                         20.   NEW DELHI
14.   JAIPUR
                                                               Shri Sameer Bhargava,
      Shri Lalit Mehta,                                        Vice President & Regional Head (North)
      Asst. Vice President                                     5th Floor, Ashoka Estate,
      C/o SBI, Sanganeri Gate,                                 24, Barakhamba Road,
      Jaipur - 302 001,                                        New Delhi - 110 001,
      Tel. (0141) 567354.                                      Tel. (011) 3315058.

15.   KOLKATA                                            21.   PATNA
      Shri G.J. Tully,                                         Shri S.K. De,
      Asst. Vice President & Regional Head (East)              Manager
      Nagaland House, 10th Floor,                              1st Floor, Chamber Bhavan,
      11 & 13 Shakespeare Sarani,                              J.C. Road,
      Calcutta - 700 071,                                      Patna - 800 001,
      Tel. (033) 2821471, 2822816.                             Tel. (0612) 685 665.

16.   LUDHIANA                                           22.   PUNE
      Shri Anil Verma                                                      .
                                                               Shri Arun P Joshi,
      Deputy Manager                                           Manager
      Tel. 4498491, 9814228415                                 C/o SBI Service Branch,
                                                               ‘Grace’, Dhole Patil Road,
17.   LUCKNOW                                                  Pune - 411 001,
      Shri S. Bose,                                            Tel. (020) 6113974.
      Asst. Vice President
                                                         23.   RANCHI
      C/o SBI LHO,
      6th Floor,                                               Shri A.K. Jain,
      A-Wing,                                                  Asst. Vice President
      Moti Mahal Marg,                                         C/o SBI Service Branch,
      Hazratganj,                                              Kutchery Road,
      Lucknow - 226 001,                                       Ranchi - 834 001,
      Tel. (0522) 215668.                                      Tel. (0651) 315212.




                                                    34
MAGNUM LIQUIBOND INCOME FUND
24.   SILIGURI                                                               The statistical data for investor complaints received are as under:

             .T.
      Shri P Sherpa,                                                             From                       01.04.01       01.04.00     01.04.99
      Asst. Vice President                                                       To                         31.07.01       31.03.01     29.03.00
      C/o SBI Siliguri Branch,                                                   Complaints Received           14980          37666        26081
      Hill Cart Road,
      Siliguri - 734 401,                                                        Complaints Redressed          15748          36860        26031
      Distt. Darjeeling,                                                         Balance                         88*            856            50
      Tel. (0353) 537065.
                                                                             *      Complaints were received at the fag end of July 2001. These
25.   VADODARA                                                                      complaints have since been redressed.

      Shri Debashish Parui,                                                  XXIII. PENDING LEGAL PROCEEDINGS AND OTHER
      Asst. ManagerSBIMF Investor Service Centre,
                                                                                              INFORMATION
      C/o. SBI, Zonal Office,
      6th Floor, Paradise Complex,                                           1. Pending Legal Proceedings
      Sayaji Gunj,
      Vadodara- 390 005.                                                     Any pending material litigation proceedings incidental to the
      Tel. (0265) 364628.                                                    business of the Mutual Fund to which the Sponsor of the Mutual
                                                                             Fund or any company associated with the Sponsor in any capacity
26.   VIJAYAWADA                                                             including the AMC, Board of Trustees /Trustee Company or any of
      Shri W. V. Kumar,                                                      the directors or key personnel is a party. Any pending criminal
      Manager                                                                cases against the Sponsor or any company associated with the
                                                                             Sponsor in any capacity including the AMC, Board of Trustees/
      C/o SBI Station Road Branch,
                                                                             Trustee Company or any of the directors or key personnel should
      Station Road,                                                          also be disclosed separately.
      Vijayawada - 520016.
      Tel. (0866) 574113.                                                    Apart from the ordinary routine litigations incidental to the business
                                                                             of the Fund, the following petition / summary suit against the Fund
5. Investor Relations Officer                                                is pending in the Court:
                                                                             l      Summary Suit No. 3799 of 1996, filed by M/s Morarka Finance
The AMC has appointed an Investor Relations Officer to look into
                                                                                    Limited is pending in the High Court of Juridicature at
investor grievances regarding deficiencies, if any, in the services
                                                                                    Bombay. The Plaintiff has filed the suit for recovery of Rs.
provided by the Registrars or the Investor Service Centres.
                                                                                    8.44 lakhs together with interest being the excess price paid
Name of the Investor             :   Shri M. Priolkar                               by them in equity buyback transaction relating to the shares
Relations Officer                :   Manager,                                       of M/s Pumpsar Distilleries Ltd.
                                     Customer Service                        AMC’s perception: The AMC has received advice that the case is
                                                                             likely to be decided in its favour.
Address                          :   SBI Funds Management Ltd.
                                     191, Maker Tower “E”,                   l                                                          .
                                                                                    A Public Interest Litigation has been filed vide W.P No. 3165/
                                     19th floor, Cuffe Parade,                      1997 with the Karnataka High Court by Shri N. Ramachandra
                                     Mumbai - 400 005.                              Rao, a unitholder under Magnum Express ‘91on the
                                                                                    performance of the scheme and seek relief therefore. The
Telephone Number                 :   218 0244 / 218 0221                            matter is pending before the Karnataka High Court.
The AMC will have the discretion to change the Investor Relations            AMC’s perception: The AMC is of the view based on legal advice
Officer depending on operational necessities and in the overall              that the case is likely to be decided in its favour.
interest of the fund.                                                        Our Sponsor, the State Bank of India is India’s largest bank with
                                                                             8930 branches in India and 52 offices in 34 countries worldwide. In
      XXII. INVESTOR GRIEVANCES REDRESSAL                                    addition to this, SBI also has 7 associates and 1 banking subsidiary
                   MECHANISM                                                 in addition to other non-banking subsidiaries in India. To the best
                                                                             of our knowledge there are no criminal cases against the Sponsor,
The Customer Service Department at SBI Mutual Fund functions                 its Directors or Key Personnel, which will have any impact on the
under the supervision of Manager. The investor grievances are                operations of SBI Mutual Fund.
redressed by the AMC directly and also by our 26 Investor Service            2. Penalties Awarded by SEBI or Any Other Regulatory Body
Centres (ISCs) all over the country. All grievances are redressed
                                                                             All cases of penalties awarded by SEBI under the SEBI Act or any
within the time stipulated by SEBI. Our ISCs are equipped with
                                                                             of its regulations against the Sponsor of the Mutual Fund or any
upgraded technological facilities to respond to the investor queries.        company associated with the Sponsor in any capacity including




                                                                        35
MAGNUM LIQUIBOND INCOME FUND
the Asset Management Company, Trustee Company/Board of                      SEBI has appointed an Adjudicating Officer to inquire into the
Trustees, or any of the directors or key personnel (specifically the        alleged violations by SBIFM Ltd. These violations relate to the
fund managers) of the Asset Management Company and Trustee                  delay in dispatch of unit certificates/account statements to investors
Company. The nature of the penalty must be disclosed. for Sponsor           in case of two schemes viz. MMIS – 98(I) and MMIS 98(II). As per
and its associates, other than the penalties as mentioned above, the        regulation 36 of SEBI (MF) Regulations, 1996, the AMC is required
penalties awarded by any financial regulatory body, including stock         to issue a unit certificate to an applicant as soon as possible but not
exchanges, for defaults in respect of shareholders, debenture               later than six weeks from the date of closure of the initial subscription
holders and depositors shall also be disclosed. Additionally,               list.
penalties awarded for any economic offence and violation of any
                                                                            We have represented the reasons for the delay in despatch of the
securities laws shall be disclosed.
                                                                            unit certificates with the Adjudicating Officer. We are taking necessary
As on date, there are no cases of penalties awarded by SEBI or any          steps against such reported delays, by effectively monitoring the
financial regulatory body against the Sponsor or any company in             operations of our registrars and transfer agents, Investor service
any capacity associated with the Sponsor including the AMC, the             centers and collecting centers.
Board of Trustees or any of the directors or key personnel of the
                                                                            Date of Approval of the scheme by the Board of Trustees: 25th July
AMC.
                                                                            1998.
3. Deficiency in Systems or Operations
Any deficiency in the systems and operations of the Sponsor of the
Mutual Fund or any company associated with the sponsor in any                                     For and on behalf of the Board of Directors,
capacity including the AMC or the Trustee Company which SEBI
                                                                                                               SBI Funds Management Limited
has specifically advised to be disclosed in the offer document, or
which has been notified by any other regulatory agency, shall be                    (the Asset Management Company for SBI Mutual Fund)
disclosed.
There is no deficiency in the systems or operations of the Sponsor
or any company associated with the Sponsor (including the AMC),
which SEBI or any other regulatory agency has specifically advised
to be disclosed in the offer document.                                      Place      : Mumbai             Name            : Niamatullah

4. Enquiry or Adjudication                                                  Date       : 7.8.2001           Designation     : Managing Director
                                                                            (Notwithstanding anything contained in the offer document the
Any enquiry/adjudication proceedings under the SEBI Act and the
                                                                            provisions of the SEBI (Mutual Funds) Regulations, 1996 and the
Regulations made thereunder, that are in progress against the
                                                                            Guidelines thereunder shall be applicable.)
Sponsor of the Mutual Fund or any company associated with the
Sponsor in any capacity including the AMC, Board of Trustees/
                                                                            Date of Revision : 7.8.2001
Trustee Company or any of the Directors or key personnel of the
Asset Management Company are being disclosed below.                         Updated as per SEBI’s Standard Observations dated 9.7.2001




                                                                       36
                                         FOR YOUR CONVENIENCE AND HELP
                                    LIST OF SBIMF INVESTOR SERVICE CENTRES (ISCs)
AHMEDABAD : Shri Ajit Phanse, Asst. Vice President, C/o SBI, Ahmedabad Main Branch, 1st Floor, Bhadra, Ahmedabad - 380 001,
Tel. (079) 5507442. BANGALORE : Shri Srinivas Jain, Vice President & Regional Head (South), Shri S.S. Narayanswamy, Asst. Vice
President & ISC Head, SBI LHO Bldg, 4th Floor, 65, St. Marks Road, Bangalore - 560 001, Tel. (080) 2272284, 2993407. BHILAI : Shri A.K.
Mitra, Manager, F-7, Uttar Gangotri, G.E. Road, Supela, Bhilai-490 023, Tel. (0788) 410955, 273261. BHOPAL: Shri V.V.K.Rao, Manager, C/
o SBI LHO, Hoshangabad Road, Bhopal - 462 011, Tel. (0755) 557341 BHUBANESHWAR : Shri N.Tripathi, Asst. Vice President, Ground
Floor, SBI LHO Bldg., Pt. Jawaharlal Nehru Marg, Janpath, Bhubaneshwar - 751 001, Tel. (0674) 402401. CHANDIGARH : Shri D.P Singh,     .
Manager, C/o SBI LHO, 1st Floor, Sector 17-B, Chandigarh - 160 017, Tel. (0172) 709728. CHENNAI : Shri V. Sukumar, Manager, SBI Bldg.,
8th Floor, 157, Annasalai, Chennai - 600 002, Tel. (044) 8523797, 8418061. COIMBATORE : Shri Rajesh Ramnarayan, Asst. Manager, SBIMF
Investor Service Centre, State Bank of India, Main Branch, Bank Road, Coimbatore - 641 018. Tel : (0422) 303863, ERNAKULAM : Shri T.
Mohan Kumar, Manager, C/o. SBI Ernakulam South Branch, 28/218, 2nd Floor, Manorama Junction, Panampilly Nagar, Cochin, Kerala - 682
036, Tel. (0484) 318886. GOA : Shri Jyothi Panvelkar, Sr. Marketing Executive, 203, Kamat Centre, Opp. Neptune Hotel, Panjim, Goa, Tel.
9822165259 GUWAHATI : Shri Utpal Baruah, Manager, C/o SBI Local Head Office (Applo Bldg. Annex), Bharalumukh, Guwahati - 781 009.
Tel. (0361) 521993. HYDERABAD : Shri A. Subramanyam, Asst. Vice President, C/o SBI LHO, 6th Floor, Koti, Hyderabad - 500 195, Tel. (040)
4756241. INDORE: Shri Ujjwal Sharma, Sr. Marketing Executive, SBI Mutual Fund, C/o. State Bank of India, Main Branch, Near GPO, Indore
- 452001, Tel. (0731) 7000189. JAIPUR : Shri Lalit Mehta, Asst. Vice President, C/o SBI, Sanganeri Gate, Jaipur - 302 001, Tel. (0141) 567354.
KOLKATA: Shri G.J. Tully, Asst. Vice President & Regional Head (East), Nagaland House, 10th Floor, 11 & 13 Shakespeare Sarani, Calcutta
- 700 071, Tel. (033) 2821471, 2822816. LUDHIANA: Shri Anil Verma, Deputy Manager, Tel. 4498491, 9814228415, LUCKNOW: Shri S. Bose,
Asst. Vice President, C/o SBI LHO, 6th Floor, A-Wing, Moti Mahal Marg, Hazratganj, Lucknow - 226 001, Tel. (0522) 215668., MANGALORE:
Shri Ashok Kumar, Deputy Manager, C/o SBI, Arya Samaj Road, Bellamatta, Mangalore - 575 003, Tel. (0824) 445892. MUMBAI : Shri
Santanu Ray, Deputy Manager, 42, Rajgir Chambers, 5th Floor, Saheed Bhagat Singh Road, Fort, Mumbai - 400 023.Tel. (022) 2658302,
2658303., NEW DELHI : Shri Sameer Bhargava, Vice President & Regional Head (North), 5th Floor, Ashoka Estate, 24, Barakhamba Road,
New Delhi - 110 001, Tel. (011) 3315058, PATNA : Shri S.K. De, Manager, 1st Floor, Chamber Bhavan, J.C. Road, Patna - 800 001,, Tel. (0612)
                             .
685 665, PUNE : Shri Arun P Joshi, Manager, C/o SBI Service Branch, ‘Grace’, Dhole Patil Road, Pune - 411 001, Tel. (020) 6113974, RANCHI
: Shri A.K. Jain, Asst. Vice President, C/o SBI Service Branch, Kutchery Road, Ranchi - 834 001,Tel. (0651) 315212, SILIGURI: Shri P        .T.
Sherpa, Asst. Vice President, C/o SBI Siliguri Branch, Hill Cart Road, Siliguri - 734 401, Distt. Darjeeling, Tel. (0353) 537065. VADODARA
: Shri Debashish Parui, Asst. ManagerSBIMF Investor Service Centre, C/o. SBI, Zonal Office, 6th Floor, Paradise Complex, Sayaji Gunj,
Vadodara- 390 005., Tel. (0265) 364628, VIJAYAWADA : Shri W. V. Kumar, Manager, C/o SBI Station Road Branch, Station Road, Vijayawada
- 520016 Tel. (0866) 574113.


                                          LIST OF DISTRICT ORGANISERS (DOs)
ALLAHABAD : Mr. V. K. Goel, Tel. : (0523) 608281, CUDDAPAH : Mr. Subha Rayudu, Tel: (08562) 43149, CUTTAK : Mr. Arun Kumar Agarwal
Tel. : (0671) 617 486/616703, DEHRADUN : Mr. Kapil Behal, Tel : (0135)659752/654739/710238, DHANBAD : Mr. Sandeep Kumar, Tel.
(0326) 203554, DURGAPUR : Mr. A.B. Kundu, Tel. (0343) 564543, GWALIOR : Mr. Damodar Sharma, Tel. :(0751) 326125, GORAKHPUR :
Mr. Sarjoo Prasad, Tel. (0551) 310335, JALANDAR : Mr. Brij Bhushan Marwaha, Tel. Tel. ( 0141) 225310, JAMMU : Mr. Sanjeev Gupta, Tel.
                                              .
: (0191) 579 001/577365, JODHPUR : Shri B.P Goyal, Tel. (0291) 627 918/641533, JUNAGADH : Mr. Sailesh Pandya, Tel. (0285) 623701/
650194/9825222402, KANPUR : Mr. Manoj Srivastav, Tel. : (0521) 251 073/251099/9839031073, MEERUT : Mr. Pankaj Kumar Sharma, Tel
: (0121) 642180/668294, MORADABAD : Mr. S. K. Garg, Tel. (0591) 418667, NASIK : Mr. Ravindra Wani, Tel. : (0253) 391971, PANIPAT :
Mr. Adesh Agarwal, Tel. : (01742) 60030, 60836, PORBANDAR : Mr. K. K. Makecha, Tel. (0286) 46907/44907, RAIGARH : Mr. Hiramotwavi,
Tel.: (07762) 23293,RAJNANDGAON : Mr. Gambhir Mal Chhajed, Tel. (07744) 25540/25577/25578/26056, RAJKOT : Mr. S. D. Davda, Tel.
(0281) 465435/46379/478427, UDAIPUR : Mr. Prem Kumar Soni, Tel (0294) 411330/525094, ROURKELA : Mr. Viresh Himani, Tel. (0661)
540493/540476, THANE : Mr. Arvind Karkhanis, Tel. (022) 5430445, TIRUPATHI : Ms. Bhagyalakshmi , Tel : (08574) 42202, TRICHY : P    .
Gunapalan, Tel. : (0431) 700731, VALSAD : Mr. Uday J. Marjadi, Tel. (02632) 43577/49749, VARANASI : Mr. Chandra Sekhar Kabra, Tel.
(0542) 311904.
MAGNUM LIQUIBOND INCOME FUND
                         NOTES




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