25/04/2020
Franklin Templeton India’s decision to shut down six debt schemes can be traced to its recent predilection for taking credit risks and chasing yields, particularly in schemes where the fund was ideally not supposed to take credit risks. The worsening economic situation has further soured the credit risk in the fund's books, leading to huge redemption pressure, forcing the fund to shut down the debt schemes.
The six Franklin funds have combined asset under management (AUM) of ₹25,856 crore as on date.
Finance and bank stocks tumbled up to 17.8 percent on Friday after Franklin Templeton MF suddenly closed some debt fund schemes
This is the first instance when a fund house is shutting its schemes because of coronavirus related pandemic