Ratings on fund managers urged

NUSA DUA, Bali (JP): Fund managers must be rated regularly to encourage domestic investors, particularly institutions, to invest more in the capital market, an analyst said here yesterday.

"Ratings are a good way to make our local investors more familiar with the services of fund managers," said Yannes Naibaho, the president of PT UsahaBersama Sekuritas, one of the country's 60 fund managers.

He said many local investors -- particularly pension funds and insurance firms -- still did not understand the benefits of using fund managers. And they needed independent assessments on the reliability and capability of fund managers.

Speaking to The Jakarta Post on the sidelines of a seminar on local investors' role in the capital market, he said performance ratings would encourage fund managers to improve their professionalism and, in turn, encourage institutional investors to use their services.

Ratings can be based on the amount of income fund managers generate on their managed funds, and on the volume of funds they manage in a year, Naibaho said.

He said ratings should be made by an independent agency.

"To maintain objectivity on ratings, we must make sure that they are made by an independent agency and not by a government institution," he said.

The other participants at the seminar, organized by the Association of Indonesian Listed Companies, shared Naibaho's view that ratings would help institutional investors to choose fund managers.

Glenn M.S. Yusuf, the president of PT Danareksa Securities, said most pension funds and insurance companies still relied on their own staff to handle their capital market investments.

B. Munir Sjamsoeddin, the president of PT Reasuransi Umum Indonesia, admitted that many institutional investors were unaware of the benefits of fund managers. (bnt)