EPFO Revamps Rs 31 Trillion Fund Management, Seeks New Custodian

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AuthorIshaan Verma|Published at:
EPFO Revamps Rs 31 Trillion Fund Management, Seeks New Custodian
Overview

The Employees' Provident Fund Organisation is undertaking a major overhaul of its investment and audit partnerships. After nearly 15 years, the retirement fund body is set to appoint a new custodian to manage its ₹31 trillion corpus. This comes as EPFO also finalizes new asset management companies for equity investments and seeks an external auditor.

The move to empanel new partner agencies signifies a strategic overhaul, aiming to modernize the management of its substantial ₹31 trillion corpus. Standard Chartered Bank, which has served as the custodian for EPFO's assets for nearly 15 years, is set to be replaced as the retirement fund manager seeks fresh bids. This process follows a previous attempt to select a custodian that was revoked in 2023 when Citibank was removed from consideration.

Custodian Search Intensifies

The current custodian, Standard Chartered Bank, was appointed in November 2011. Plans to appoint a successor have been pending for approximately five years. In 2024, the EPFO's Investment Committee (IC) decided against running simultaneous processes for appointing a new custodian and portfolio managers, opting for a phased approach. The committee is now preparing a formal tender, inviting eligible companies to bid for the critical role of safeguarding the fund's assets.

AMC and Portfolio Manager Appointments

EPFO has also been active in revamping its asset management. In October 2025, HDFC Asset Management Company Limited and Aditya Birla Sun Life AMC Limited were approved to manage equity investments. Concurrently, existing portfolio managers SBI Funds Management Limited and UTI Asset Management Company Limited were reappointed. The tenure of the present AMCs, including ICICI Prudential Asset Management Company Limited, SBI Funds Management Limited, Nippon Life India Asset Management Limited, and UTI Asset Management Company Limited, is set to expire on July 2, prompting the initiation of a new appointment process for these roles as well.

Audit Partner Under Review

Beyond investment management, the EPFO is also finalizing a request for proposal (RFP) for its external concurrent auditor (ECA). This auditor scrutinizes the organization's investment activities. The term of the current ECA, Choksi and Choksi LLP, concluded on January 31. While their term has been extended until December 31, a new appointment is anticipated. The RFP for the ECA will be vetted by an expert agency to ensure compliance and adherence to best market practices.

Portfolio Allocation

As of December 31, 2025, the EPFO's investment portfolio remained heavily weighted towards debt, constituting over 89% of its total assets. Equity investments accounted for a smaller share at 10.57%. This allocation strategy guides the mandates for both portfolio managers and asset management companies.

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