O F F E R D O C U M E N T

BOB MUTUAL FUND

(Sponsor: Bank of Baroda)

Investment Manager: BOB Asset Management Company Ltd.

Maneckji Wadia Building, 2nd Floor

Nanik Motwane Marg, Opp. University of Mumbai

Fort, Mumbai – 400 023.

BOB LIQUID FUND BOB GILT FUND

OPEN ENDED LIQUID SCHEME OPEN ENDED INCOME SCHEME

SPONSOR	TRUST	ASSET MANAGEMENT COMPANY
BANK OF BARODA	BOB MUTUAL FUND	BOB ASSET MANAGEMENT COMPANY LTD.
H.O. Mandvi BARODA	2nd Floor, Maneckji Wadia Bldg., Nanik Motwane Marg, Opp. University of Mumbai, Fort, Mumbai - 400 023. Website:www.bobmf.com	2nd Floor, Maneckji Wadia Bldg., Nanik Motwane Marg, Opp. University of Mumbai, Fort, Mumbai - 400 023. Tel: 267 0112 Fax: 267 0203 E-mail: bobamc@vsnl.com

Issue of Units of Rs. 10/- per Unit for cash during the Initial Offer and at NAV based prices subsequently

Initial Offer opens on ___________	__________
Initial Offer closes on ___________	__________

The Offer Document sets forth concisely information about the Schemes that a prospective investor ought to know before investing. The Offer Document should be read in its entirety before making an application for respective Schemes and should be retained for future reference.

DISCLAIMER CLAUSE

The Schemes particulars have been prepared in accordance with Securities And Exchange Board of India (SEBI) (Mutual Funds) Regulations 1996, as amended till date and filed with SEBI and the Units being offered for public subscription have not been approved or disapproved by SEBI nor has SEBI certified the accuracy or adequacy of the Offer Document.

NOTE: The Offer Document will remain effective till a “material change” (other than a change in Fundamental Attributes and within the purview of the Offer Document) occurs and thereafter the changes shall be filed with SEBI and circulated to Unitholders along with yearly reports.

BOB MUTUAL FUND

INDEX

Sr. No.	TABLE OF CONTENTS	PAGE
1.	RISK FACTORS	3
2.	DEFINITIONS	5
3.	EXPENSES	6
4.	CONDENSED FINANCIAL INFORMATION	8
5.	CONSTITUTION OF THE MUTUAL FUND	9
6.	INVESTMENT OBJECTIVES AND POLICY	14
7.	MANAGEMENT OF THE FUND	21
8.	UNITS AND OFFER	24
9.	SALE OF UNITS	27
10.	DIVIDENDS AND DISTRIBUTION	29
11.	INTER SCHEME TRANSFERS	29
12.	ASSOCIATE TRANSACTIONS	30
13.	BORROWINGS BY THE MUTUAL FUND	31
14.	NET ASSET VALUE (NAV) AND VALUATION OF ASSETS OF THE SCHEMES	31
15.	REPURCHASE / REDEMPTION OF UNITS	34
16.	ACCOUNTING POLICIES AND STANDARDS	36
17.	TAX BENEFITS	37
18.	INVESTORS RIGHTS AND SERVICES	39
19.	INVESTOR GRIEVANCES REDRESSAL MECHANISM	40
20.	PENALTIES, PENDING LITIGATION OR PROCEEDINGS, FINDINGS OF INSPECTIONS OR INVESTIGATIONS FOR WHICH ACTION MAY HAVE BEEN TAKEN OR IS IN THE PROCESS OF BEING TAKEN BY ANY REGULATORY AUTHORITY	41
21.	MISCELLANEOUS PROVISIONS AND OTHER INFORMATION	42
22.	DUE DILIGENCE CERTIFICATE	43

1. RISK FACTORS

These risk factors may be peculiar to the Mutual Fund as well as those attendant with specific policies and objectives of the Schemes.

Standard Risk Factors

i. Mutual funds and securities investments are subject to market risks and there is no assurance or guarantee that the objectives of the Mutual Fund will be achieved.

ii. As with any investments in securities, the Net Asset Value (NAV) of the units of the Schemes can go up as well as down depending on the factors and forces affecting securities markets.

iii. Past performance of the Sponsor/the Asset Management Company/Mutual Fund does not indicate the future performance of the Schemes of the Mutual Fund.

iv. The names of the respective Schemes do not in any manner indicate either the quality of the Schemes, or their future prospects and returns.

Note:

i. Investors in the Schemes are not being offered a guarantee or assured rate of return.

ii. Prospective investors should review the Offer Document carefully and in its entirety and consult their legal, tax and financial advisers to determine possible legal, tax, financial or other consequences of subscribing, purchasing or holding Units before making an application for Units.

iii. Any information or representation concerning BOB Mutual Fund or the Schemes which is inconsistent with what has been set out herein is unauthorised.

iv. Any change made in the Offer Document is subject to SEBI approval or approval of Unitholders as may be necessary under the SEBI Regulations.

BOB LIQUID FUND

Highlights

· BOB Liquid Fund is an open-ended money market scheme from BOB Mutual Fund (BOBMF)

· BOB Mutual Fund is sponsored by Bank of Baroda, one of the largest public sector banks of the country. BOB Asset Management Company Limited (BOBAMC) is the Investment Manager to the Scheme. BOB Mutual Fund has launched four schemes and has a wide investor base

· Scheme is targeted for generating income with a high level of liquidity by investing in a portfolio of money market instruments & debt securities.

· Transparency of operations i.e. daily determination of NAV, sale price, redemption price and full disclosure of investment portfolio periodically

· Choice of Growth Plan, Dividend Plan and Dividend Re-investment Plan

· Facility of Systematic investment and withdrawal available

· Dividend/Income distribution is totally free of tax under section 10(33) of the Income Tax Act, 1961

· Assured allotment to all applicants

Scheme Specific Risk Factors

i. All financial investments carry market and other risks and there is no assurance that the objectives of the Scheme will be achieved.

ii. The Sponsor is not responsible nor liable for any loss resulting from the operation of the Scheme beyond the initial contribution of Rs. 10 lacs made by it towards the corpus of the Fund.

iii. The liquidity of the Scheme’s investments may be restricted by trading volumes, settlement periods and transfer procedures. In the event of inordinately large number of redemption requests or of a restructuring of the Scheme’s portfolio, the time taken by BOBMF for redemption of BOB Liquid Fund units may be adversely affected. Please see BOBMF’s “Right to Limit Redemptions” as mentioned in Clause 15(iv) hereinbelow.

iv. Price-Risk or Interest-Rate risk: Fixed income securities such as bonds, debentures and money market instruments run price-risk or interest rate risk. Generally, when interest rates rise, prices of existing fixed income securities fall and when interest rates drop, such prices increase. The extent of fall or rise in the prices is a function of the existing coupon, days to maturity and the increase or decrease in the level of interest rates.

v. Credit Risk: In simple terms this risk means that the issuer of a debenture/bond or a money market instrument may default on interest payment or even in paying back the principal amount on maturity. Even where no default occurs, the price of a security may go down because the credit rating of an issuer goes down. It must be however noted that where the Scheme has invested in Government securities, there is no credit risk in respect of the same.

vi. Reinvestment Risk: This risk refers to the interest rate levels at which cash flows received from the securities in the scheme are reinvested. The additional income from reinvestment is the “interest on interest” component. The risk is that the rate at which interim cash flows can be reinvested may be lower than that originally assured.

vii. Liquidity of the scheme may suffer if the guidelines issued by RBI applicable to liquid funds undergo any major changes.

viii. Securities which are not quoted on the stock exchanges are inherently illiquid in nature and carry a larger amount of liquidity risks, in comparison to securities that are listed on the exchanges or offer other exit options to investors, including a put option. The AMC may choose to invest in unlisted securities that offer attractive yields. This may increase the risk of the portfolio

ix. As zero coupon securities do not provide periodic interest payments to the holder of the security, theses securities are more sensitive to changes in interest rate hence the risk of zero coupon securities is higher. The AMC may choose to invest in zero coupon securities that offer attractive yields. This may increase the risk of the portfolio

x. From time to time and subject to the Regulations, any unitholder or the Sponsor, investment companies of the Sponsor, funds managed by the Sponsor, their affiliates, associate companies, subsidiaries, the AMC and the Trustee Company may acquire a substantial portion of the units of the Scheme and collectively constitute a major investor in the Scheme. Accordingly, redemption of Units by such entities may have an adverse impact on the Units of the Scheme because the timing of such redemption may impact the ability of other Unit holders to redeem their Units.

xi. The AMC, on behalf of the respective Plans, may also invest in Government Securities issued by G-7 nations and other Foreign Governments as and when permitted by the concerned regulatory authorities in India.

BOB GILT FUND

Highlights

· BOB GILT Fund is an open-ended income scheme from BOB Mutual Fund (BOBMF)

· BOB Mutual Fund is sponsored by Bank of Baroda, one of the largest public sector banks of the country. BOB Asset Management Company Limited (BOBAMC) is the Investment Manager to the Scheme. BOB Mutual Fund has launched four schemes and has a wide investor base

· Scheme is targeted for generating income by investing in a portfolio of government securities.

· Transparency of operations i.e. daily determination of NAV, sale price, redemption price and full disclosure of investment portfolio periodically

· Choice of Growth Plan, Dividend Plan and Dividend Re-investment Plan

· Facility of Systematic investment and withdrawal available

· Dividend/Income distribution is totally free of tax under section 10(33) of the Income Tax Act, 1961

· Assured allotment to all applicants

Scheme Specific Risk Factors

i. All financial investments carry market and other risks and there is no assurance that the objectives of the Scheme will be achieved.

ii. The Sponsor is not responsible nor liable for any loss resulting from the operation of the Scheme beyond the initial contribution of Rs. 10 lacs made by it towards the corpus of the Fund.

iii. The liquidity of the Scheme’s investments may be restricted by trading volumes, settlement periods and transfer procedures. In the event of inordinately large number of redemption requests or of a restructuring of the Scheme’s portfolio, the time taken by BOBMF for redemption of BOB Gilt Fund units may be adversely affected. Please see BOBMF’s “Right to Limit Redemptions” as mentioned in clause 15(iv) hereinbelow.

iv. Price-Risk or Interest-Rate risk: Government securities like other Fixed income securities such as bonds, debentures and money market instruments run price-risk or interest rate risk. Generally, when interest rates rise, prices of existing fixed income securities fall and when interest rates drop, such prices increase. The extent of fall or rise in the prices is a function of the existing coupon, days to maturity and the increase or decrease in the level of interest rates. Government securities are unique in the sense that their credit risk always remains zero. Therefore their prices are influenced only by movement in interest rate in the financial system.

v. Reinvestment Risk: This risk refers to the interest rate levels at which cash flows received from the securities in the scheme are reinvested. The additional income from reinvestment is the “interest on interest” component. The risk is that the rate at which interim cash flows can be reinvested may be lower than that originally assured.

vi. Liquidity of the scheme may suffer if the guidelines issued by RBI for gilt funds undergo any major changes.

vii. From time to time and subject to the Regulations, any unitholder or the Sponsor, investment companies of the Sponsor, funds managed by the Sponsor, their affiliates, associate companies, subsidiaries, the AMC and the Trustee Company may acquire a substantial portion of the units of the Scheme and collectively constitute a major investor in the Scheme. Accordingly, redemption of Units by such entities may have an adverse impact on the Units of the Scheme because the timing of such redemption may impact the ability of other Unit holders to redeem their Units.

viii. The AMC, on behalf of the respective Plans, may also invest in Government Securities issued by G-7 nations and other Foreign Governments as and when permitted by the concerned regulatory authorities in India.

2. DEFINITIONS
Applicable NAV	NAV for Sale or Repurchase shall as the context may require, in respect of any application received between 9.30 a.m. to 10.15 a.m. on any Business Day, subject to it being complete in all respects, shall be the NAV, subject to applicable load, if any, of the respective Plan as at the close of that Business Day. Applications received after 10.15 a.m till 3.30 p.m. on any Business Day, shall be deemed to have been accepted as of the next Business Day and the NAV, subject to load, if any, of the respective Plan as at the close of that Business Day shall be applicable. The AMC reserves the right to change these timings and the same may be different for each Investor Service Centre and for respective Plans.
BOBAMC or Investment Manager or Asset Management Company (AMC)	BOB Asset Management Company Limited
Business Day/Working Day	Any day other than a Saturday, Sunday or any day on which Banks/RBI in Mumbai or the National Stock Exchange or The Stock Exchange, Mumbai are not required or obliged by law or Executive Order to remain closed for business including the occasions when the functioning of Banks/RBI is affected due to a strike call made by a recognised Union/Management in any part of the country and a day on which the sale and redemption of units is suspended by the Trustee/AMC.
Custodian	Deutsche Bank
Government Securities/Gilts	Securities created and issued by the Central Government and/or a State Government (including Treasury Bills) or Government Securities as defined in the Public Debt Act, 1944, including any amendments/clarifications and guidelines or circulars issued in relation thereto.
Mutual Fund or BOBMF	BOB Mutual Fund, constituted under Trust Deed and sponsored by Bank of Baroda
NAV	The Net Asset Value of the Schemes calculated and published in the manner provided in this Offer Document
Offer Document	This Offer Document through which Units of BOB Liquid Fund and BOB Gilt Fund are being offered for subscription
Registrar and Transfer Agents (R&T Agent) and Registrars to the Schemes	Karvy Consultants Ltd.
Repo/Reverse Repo	Sale/Purchase of Government securities with simultaneous agreement to repurchase/resell them at a later date.
RBI	Reserve Bank of India, established under the Reserve Bank of India Act, 1934
Schemes	BOB Liquid Fund and BOB Gilt Fund are collectively referred to as “the Schemes” and individually, where as the context so permits, as “the Scheme”.
SEBI	Securities and Exchange Board of India constituted under the Securities and Exchange Board of India Act, 1992, as amended from time to time
SEBI Regulations or Regulations	Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, as amended from time to time including all SEBI notifications and circulars issued by SEBI from time to time relating to Mutual Funds
Sponsor	Bank of Baroda
Trustees or Board of Trustees	The Board of Trustees of BOB Mutual Fund
Trust Deed	The Trust Deed dated 30th October, 1992
Units	The Units which are offered for subscription under this Offer Document
Unitholder	A person holding Units of the Schemes

3. EXPENSES

(a) Unitholder Transaction Expenses or Load

i) Maximum Sales Load imposed on purchases 7% (as percentage of NAV)

ii) Maximum Redemption/Repurchase Load 7% (as percentage of NAV)

Note:

1) The difference between the repurchase price and the sale price of the Units shall not exceed 7% calculated on the Sale Price.

2) The actual sale/redemption load to be charged will be at such rates as may be decided by the Trustees from time to time, subject to maximum limits stated above.

b) Initial Issue Expenses

BOB LIQUID FUND

All the initial issue expenses under the Scheme will be borne by BOBAMC. Accordingly the entire amount subscribed by the investor will be invested in the securities as per the terms of the Offer Document.

Thus for every Rs. 100 contributed by the investor, Rs. 100 will be available for investment by the Scheme.

BOB GILT FUND

All the initial issue expenses under the Scheme will be borne by BOBAMC. Accordingly the entire amount subscribed by the investor will be invested in the securities as per the terms of the Offer Document.

Thus for every Rs. 100 contributed by the investor, Rs. 100 will be available for investment by the Scheme.

(c) Ongoing basis

BOB LIQUID FUND

For ongoing subscriptions, units will be offered to investors at NAV based prices. Subscription requests received on any working day will be priced at applicable NAV. No entry/exit load is presently charged. However the AMC reserves the right to charge entry/exit load with prospective effect.

BOB GILT FUND

For ongoing subscriptions, units will be offered to investors at NAV based prices. Subscription requests received on any working day will be priced at applicable NAV. If the units are redeemed within 3 months from the date of purchase of units, an exit load of 0.5% of the applicable NAV will be charged. No exit load will be charged if the units are redeemed after 3 months from the date of purchase.

However the AMC reserves the right to charge entry/exit load with prospective effect.

Subject to the Regulations, the Trustees of BOBMF have the right to change/modify the load structure, with prospective effect, at a later date. Any change in the load structure will be applicable to all prospective investments.

(d)Contingent Deferred Sales Load (CDSL) (For BOB Liquid Fund & BOB Gilt Fund )

Under the Regulations, the Fund can charge CDSL to Unitholders exiting from the Schemes within 4 years of entry (up to 4% for redemptions in the first year, up to 3% for redemptions in the 2^nd year, up to 2% for redemptions in the 3^rd year and up to 1% for redemptions in the 4^th year) . The CDSL is intended to enable the AMC to recover expenses incurred for the promotion or propagation of the Scheme which otherwise the Unitholders may have had to bear, had it been a Load Scheme.

Under the Scheme, the AMC reserves the right to charge a CDSL when the units are redeemed either by redemption or by switching from one option to the other as permitted by the Regulations

At present there is no CDSL. However the AMC reserves the right to charge / change CDSL at a later date, which shall be applicable on prospective investment only. The investors will be advised of charge / change of CDSL by the AMC through Press Release or advertisement in the newspaper. The AMC will also inform the Investor Service Centres about the introduction or change in CDSL. The applicable charge shall also be disclosed on the Account Statement issued to Investors, after introduction of such charge

(e) Use of Load

All the load (including CDSL) will be used, in whole or in part, by BOBAMC for providing distribution and redemption related services to the Schemes including expenses relating to the sale, promotion and marketing of the Units, payments to agents/brokers for their services in connection with the distribution of the Units, postage, application processing, disseminating NAV related information, etc.

All load for the Schemes shall be maintained in a separate account. Excess load collected from ongoing sales/redemption may be returned to the Schemes, whenever felt appropriate by BOBAMC.

(f) Fees

Investment management fees charged by BOBAMC shall be 1% of the average weekly Net Assets.

Further under SEBI Regulations for schemes launched on a “no load” basis, the AMC is entitled to collect an additional management fee not exceeding 1% of the weekly average net assets outstanding in each financial year. Since these schemes are launched on a “no load” basis, the AMC would be entitled to collect additional management fee of upto 1% of the weekly average net assets outstanding in each financial year.

The AMC may at its sole discretion from time to time charge fees lower than the prescribed rate. The AMC may also charge further fees as may be permitted from time to time under the Regulations.

f) The total ongoing recurring expenses permitted by SEBI are as follows:

1. On the first Rs. 100 crores - 2.50% of the average weekly net assets outstanding during the accounting year.

2. On the next Rs. 300 crores - 2.25% of the average weekly net assets outstanding during the accounting year.

3. On the next Rs. 300 crores - 2.00% of the average weekly net assets outstanding during the accounting year.

4. On the balance - 1.75% of the average weekly net assets outstanding during the accounting year.

The Fund will strive to reduce the level of expenses so as to keep them well within the maximum limits allowed by SEBI. Presently the Fund estimates the recurring expenses as follows:

	BOB LIQUID FUND	BOB GILT FUND
Investment Management & Advisory Fee