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Top 5 Best Banking and PSU Debt Funds 2023

Updated on September 17, 2023 , 19642 views

Banking and PSU Debt Funds are the new sub-category introduced by the Securities and Exchange Board of India (SEBI) in the debt Mutual Fund category. These funds predominantly invests in debt and money market instruments consisting of securities issued by entities such as Banks, Public Financial Institutions, Public Sector Undertakings, etc. This option is considered to maintain an optimum balance of liquidity, safety, and yield.

The Banking and PSU Debt fund belongs to the short term category of debt funds that aims to offer secured returns and minimise risk by Investing in good-quality debt instruments predominately issued by banks and public sector undertakings. Investors who are keen to invest for a short duration, ideally for 2-3 years can invest in this scheme.

Here are some of the best performing Banking and PSU debt Funds 2023 - 2024.

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Top Performing Banking and PSU Debt Funds

Fund	NAV	Net Assets (Cr)	3 MO (%)	6 MO (%)	1 YR (%)	3 YR (%)	2022 (%)	Debt Yield (YTM)	Mod. Duration	Eff. Maturity
HDFC Banking and PSU Debt Fund Growth	₹19.9507 ↓ 0.00	₹6,373	1.3	3.7	6.3	4.9	3.3	7.46%	2Y 3M 6D	3Y 5M 2D
UTI Banking & PSU Debt Fund Growth	₹19.0338 ↓ -0.01	₹967	0.7	3.7	5.6	6.5	10.3	7.43%	3Y 1M 2D	3Y 9M
ICICI Prudential Banking and PSU Debt Fund Growth	₹28.3816 ↑ 0.00	₹8,146	1.6	3.9	7.2	5.5	4.3	7.79%	1Y 9M	4Y 5M 19D
Kotak Banking and PSU Debt fund Growth	₹56.5456 ↓ -0.02	₹6,343	1	3.6	6.4	5	3.6	7.79%	3Y 1M 17D	9Y 7M 17D
Aditya Birla Sun Life Banking & PSU Debt Fund Growth	₹317.783 ↓ -0.04	₹8,400	1.2	3.6	6.2	5	3.7	7.5%	2Y 6M 11D	4Y 11M 23D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 22 Aug 23

Top 5 Best Performing Banking and PSU Debt Funds

1. HDFC Banking and PSU Debt Fund

To generate regular income through investments in debt and money market instruments consisting predominantly of securities issued by entities such as Scheduled Commercial Banks and Public Sector undertakings. There is no assurance that the investment objective of the Scheme will be realized.

HDFC Banking and PSU Debt Fund is a Debt - Banking & PSU Debt fund was launched on 26 Mar 14. It is a fund with Moderately Low risk and has given a CAGR/Annualized return of 7.6% since its launch. Ranked 6 in Banking & PSU Debt category. Return for 2022 was 3.3% , 2021 was 3.7% and 2020 was 10.6% .

Below is the key information for HDFC Banking and PSU Debt Fund

HDFC Banking and PSU Debt Fund Growth
Launch Date	26 Mar 14
NAV (22 Aug 23)	₹19.9507 ↓ 0.00 (-0.01 %)
Net Assets (Cr)	₹6,373 on 31 Jul 23
Category	Debt - Banking & PSU Debt
AMC	HDFC Asset Management Company Limited
Rating	☆☆☆☆☆
Risk	Moderately Low
Expense Ratio	0.81
Sharpe Ratio	0.1
Information Ratio	0
Alpha Ratio	0
Min Investment	5,000
Min SIP Investment	300
Exit Load	NIL
Yield to Maturity	7.46%
Effective Maturity	3 Years 5 Months 2 Days
Modified Duration	2 Years 3 Months 6 Days

Growth of 10,000 investment over the years.

Date	Value
31 Aug 18	₹10,000
31 Aug 19	₹11,028
31 Aug 20	₹12,173
31 Aug 21	₹12,867
31 Aug 22	₹13,222
31 Aug 23	₹14,071

HDFC Banking and PSU Debt Fund SIP Returns

Total investment amount is ₹180,000
expected amount after 3 Years is ₹203,125.
Net Profit of ₹23,125 Invest Now

Returns for HDFC Banking and PSU Debt Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 22 Aug 23

Duration	Returns
1 Month	0.3%
3 Month	1.3%
6 Month	3.7%
1 Year	6.3%
3 Year	4.9%
5 Year	7%
10 Year
15 Year
Since launch	7.6%

Historical performance (Yearly) on absolute basis

Year	Returns
2022	3.3%
2021	3.7%
2020	10.6%
2019	10.2%
2018	5.9%
2017	6.3%
2016	10.8%
2015	9.8%
2014
2013

Fund Manager information for HDFC Banking and PSU Debt Fund

Name	Since	Tenure
Anil Bamboli	26 Mar 14	9.44 Yr.
Dhruv Muchhal	22 Jun 23	0.19 Yr.

Data below for HDFC Banking and PSU Debt Fund as on 31 Jul 23

Asset Allocation

Asset Class	Value
Cash	19.2%
Debt	80.8%

Debt Sector Allocation

Sector	Value
Corporate	51.22%
Government	45.36%
Cash Equivalent	3.41%

Credit Quality

Rating	Value
AAA	100%

Top Securities Holdings / Portfolio

Name	Holding	Value	Quantity
7.879999999999999% Govt Stock 2028 Sovereign Bonds \| -	4%	₹264 Cr	26,500,000
Small Industries Development Bank Of India Debentures \| -	4%	₹225 Cr	22,500
7.26% Govt Stock 2033 Sovereign Bonds \| -	3%	₹216 Cr	21,500,000
7.1% Govt Stock 2029 Sovereign Bonds \| -	3%	₹194 Cr	19,500,000
Power Finance Corporation Ltd. Debentures \| -	3%	₹175 Cr	1,750
Power Finance Corporation Ltd. Debentures \| -	2%	₹150 Cr	15,000
Rural Electrification Corporation Limited Debentures \| -	2%	₹150 Cr	1,500
National Bank For Agriculture And Rural Development Debentures \| -	2%	₹149 Cr	1,500
Housing And Urban Development Corporation Limited Debentures \| -	2%	₹131 Cr	1,250
HDFC Bank Limited Debentures \| -	2%	₹126 Cr	12,500

2. UTI Banking & PSU Debt Fund

The investment objective of the scheme is to generate steady and reasonable income, with low risk and high level of liquidity from a portfolio of predominantly debt & money market securities by Banks and Public Sector Undertakings (PSUs).

UTI Banking & PSU Debt Fund is a Debt - Banking & PSU Debt fund was launched on 3 Feb 14. It is a fund with Moderate risk and has given a CAGR/Annualized return of 7% since its launch. Ranked 3 in Banking & PSU Debt category. Return for 2022 was 10.3% , 2021 was 2.8% and 2020 was 8.9% .

Below is the key information for UTI Banking & PSU Debt Fund

UTI Banking & PSU Debt Fund Growth
Launch Date	3 Feb 14
NAV (22 Aug 23)	₹19.0338 ↓ -0.01 (-0.03 %)
Net Assets (Cr)	₹967 on 31 Jul 23
Category	Debt - Banking & PSU Debt
AMC	UTI Asset Management Company Ltd
Rating	☆☆☆☆☆
Risk	Moderate
Expense Ratio	0.5
Sharpe Ratio	-0.13
Information Ratio	0
Alpha Ratio	0
Min Investment	5,000
Min SIP Investment	500
Exit Load	NIL
Yield to Maturity	7.43%
Effective Maturity	3 Years 9 Months
Modified Duration	3 Years 1 Month 2 Days

Growth of 10,000 investment over the years.

Date	Value
31 Aug 18	₹10,000
31 Aug 19	₹10,115
31 Aug 20	₹10,863
31 Aug 21	₹11,309
31 Aug 22	₹12,431
31 Aug 23	₹13,143

UTI Banking & PSU Debt Fund SIP Returns

Total investment amount is ₹180,000
expected amount after 3 Years is ₹197,169.
Net Profit of ₹17,169 Invest Now

Returns for UTI Banking & PSU Debt Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 22 Aug 23

Duration	Returns
1 Month	0.1%
3 Month	0.7%
6 Month	3.7%
1 Year	5.6%
3 Year	6.5%
5 Year	5.6%
10 Year
15 Year
Since launch	7%

Historical performance (Yearly) on absolute basis

Year	Returns
2022	10.3%
2021	2.8%
2020	8.9%
2019	-1%
2018	6.8%
2017	6.4%
2016	11.7%
2015	8.6%
2014
2013

Fund Manager information for UTI Banking & PSU Debt Fund

Name	Since	Tenure
Anurag Mittal	1 Dec 21	1.75 Yr.

Data below for UTI Banking & PSU Debt Fund as on 31 Jul 23

Asset Allocation

Asset Class	Value
Cash	6.91%
Debt	93.09%

Debt Sector Allocation

Sector	Value
Government	53.24%
Corporate	39.84%
Cash Equivalent	6.91%

Credit Quality

Rating	Value
AAA	100%

Top Securities Holdings / Portfolio

Name	Holding	Value	Quantity
7.38% Govt Stock 2027 Sovereign Bonds \| -	21%	₹201 Cr	2,000,000,000
Rural Electrification Corporation Limited Debentures \| -	6%	₹60 Cr	6,000
Axis Bank Limited Debentures \| -	6%	₹55 Cr	550
ICICI Bank Limited Debentures \| -	5%	₹52 Cr	550
Hindustan Petroleum Corporation Limited Debentures \| -	5%	₹50 Cr	5,000
HDFC Bank Limited Debentures \| -	4%	₹40 Cr	400
Power Finance Corporation Ltd. Debentures \| -	4%	₹40 Cr	400
National Bank For Agriculture And Rural Development Debentures \| -	4%	₹40 Cr	4,000
National Bank For Agriculture And Rural Development Debentures \| -	3%	₹26 Cr	250
Indian Railway Finance Corporation Limited Debentures \| -	3%	₹25 Cr	250

3. ICICI Prudential Banking and PSU Debt Fund

The investment objective of the Scheme is to generate regular income through investments in a basket of debt and money market instruments consisting predominantly of securities issued by entities such as Banks and Public Sector Undertakings (PSU) with a view to providing reasonable returns,while maintaining an optimum balance of safety, liquidity and yield.

ICICI Prudential Banking and PSU Debt Fund is a Debt - Banking & PSU Debt fund was launched on 1 Jan 10. It is a fund with Moderate risk and has given a CAGR/Annualized return of 7.9% since its launch. Ranked 13 in Banking & PSU Debt category. Return for 2022 was 4.3% , 2021 was 4.2% and 2020 was 9.3% .

Below is the key information for ICICI Prudential Banking and PSU Debt Fund

ICICI Prudential Banking and PSU Debt Fund Growth
Launch Date	1 Jan 10
NAV (22 Aug 23)	₹28.3816 ↑ 0.00 (0.01 %)
Net Assets (Cr)	₹8,146 on 31 Jul 23
Category	Debt - Banking & PSU Debt
AMC	ICICI Prudential Asset Management Company Limited
Rating	☆☆☆☆
Risk	Moderate
Expense Ratio	0.79
Sharpe Ratio	1.27
Information Ratio	0
Alpha Ratio	0
Min Investment	5,000
Min SIP Investment	100
Exit Load	NIL
Yield to Maturity	7.79%
Effective Maturity	4 Years 5 Months 19 Days
Modified Duration	1 Year 9 Months

Growth of 10,000 investment over the years.

Date	Value
31 Aug 18	₹10,000
31 Aug 19	₹10,949
31 Aug 20	₹11,935
31 Aug 21	₹12,654
31 Aug 22	₹13,113
31 Aug 23	₹14,049

ICICI Prudential Banking and PSU Debt Fund SIP Returns

Total investment amount is ₹180,000
expected amount after 3 Years is ₹200,132.
Net Profit of ₹20,132 Invest Now

Returns for ICICI Prudential Banking and PSU Debt Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 22 Aug 23

Duration	Returns
1 Month	0.5%
3 Month	1.6%
6 Month	3.9%
1 Year	7.2%
3 Year	5.5%
5 Year	7%
10 Year
15 Year
Since launch	7.9%

Historical performance (Yearly) on absolute basis

Year	Returns
2022	4.3%
2021	4.2%
2020	9.3%
2019	10.1%
2018	5.7%
2017	5.6%
2016	12.6%
2015	8.6%
2014	10.5%
2013	8.9%

Fund Manager information for ICICI Prudential Banking and PSU Debt Fund

Name	Since	Tenure
Chandni Gupta	15 Jan 15	8.63 Yr.
Rohit Lakhotia	12 Jun 23	0.22 Yr.

Data below for ICICI Prudential Banking and PSU Debt Fund as on 31 Jul 23

Asset Allocation

Asset Class	Value
Cash	20.19%
Debt	79.81%

Debt Sector Allocation

Sector	Value
Government	48.23%
Corporate	45.29%
Cash Equivalent	6.47%

Credit Quality

Rating	Value
AAA	100%

Top Securities Holdings / Portfolio

Name	Holding	Value	Quantity
8.51% Govt Stock 2033 Sovereign Bonds \| -	11%	₹932 Cr	91,809,470 ↓ -5,000,000
Small Industries Development Bank Of India Debentures \| -	7%	₹606 Cr	6,100
HDFC Bank Limited Debentures \| -	6%	₹490 Cr	49,000
7.06% Govt Stock 2028 Sovereign Bonds \| -	6%	₹473 Cr	47,500,000
Power Finance Corporation Ltd. Debentures \| -	3%	₹273 Cr	27,500 ↑ 5,000
7.38% Govt Stock 2027 Sovereign Bonds \| -	3%	₹252 Cr	25,000,000
National Bank For Agriculture And Rural Development Debentures \| -	3%	₹249 Cr	25,000
Housing And Urban Development Corporation Ltd. Debentures \| -	3%	₹226 Cr	22,500
7.93% Govt Stock 2034 Sovereign Bonds \| -	3%	₹219 Cr	21,936,820 ↓ -10,000,000
Bharat Petroleum Corporation Limited Debentures \| -	2%	₹200 Cr	20,000

4. Kotak Banking and PSU Debt fund

To generate income by predominantly investing in debt & money market securities issued by Banks & PSUs and Reverse Repos in such securities, sovereign securities issued by the Central Government and State Governments, and / or any security unconditionally guaranteed by the Govt. of India.

Kotak Banking and PSU Debt fund is a Debt - Banking & PSU Debt fund was launched on 29 Dec 98. It is a fund with Moderately Low risk and has given a CAGR/Annualized return of since its launch. Ranked 19 in Banking & PSU Debt category. Return for 2022 was 3.6% , 2021 was 3.9% and 2020 was 10.5% .

Below is the key information for Kotak Banking and PSU Debt fund

Kotak Banking and PSU Debt fund Growth
Launch Date	29 Dec 98
NAV (22 Aug 23)	₹56.5456 ↓ -0.02 (-0.04 %)
Net Assets (Cr)	₹6,343 on 31 Jul 23
Category	Debt - Banking & PSU Debt
AMC	Kotak Mahindra Asset Management Co Ltd
Rating	☆☆☆☆
Risk	Moderately Low
Expense Ratio	0.6
Sharpe Ratio	0.22
Information Ratio	0
Alpha Ratio	0
Min Investment	5,000
Min SIP Investment	1,000
Exit Load	NIL
Yield to Maturity	7.79%
Effective Maturity	9 Years 7 Months 17 Days
Modified Duration	3 Years 1 Month 17 Days

Growth of 10,000 investment over the years.

Date	Value
31 Aug 18	₹10,000
31 Aug 19	₹11,118
31 Aug 20	₹12,253
31 Aug 21	₹12,944
31 Aug 22	₹13,343
31 Aug 23	₹14,210

Kotak Banking and PSU Debt fund SIP Returns

Total investment amount is ₹180,000
expected amount after 3 Years is ₹203,125.
Net Profit of ₹23,125 Invest Now

Returns for Kotak Banking and PSU Debt fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 22 Aug 23

Duration	Returns
1 Month	0.2%
3 Month	1%
6 Month	3.6%
1 Year	6.4%
3 Year	5%
5 Year	7.2%
10 Year
15 Year
Since launch

Historical performance (Yearly) on absolute basis

Year	Returns
2022	3.6%
2021	3.9%
2020	10.5%
2019	10.8%
2018	6.7%
2017	6.2%
2016	10%
2015	8.6%
2014	9.5%
2013	9.8%

Fund Manager information for Kotak Banking and PSU Debt fund

Name	Since	Tenure
Deepak Agrawal	15 Apr 08	15.39 Yr.
Abhishek Bisen	1 Nov 22	0.83 Yr.
Palha Khanna	3 Jul 23	0.16 Yr.

Data below for Kotak Banking and PSU Debt fund as on 31 Jul 23

Asset Allocation

Asset Class	Value
Cash	8.49%
Debt	91.51%

Debt Sector Allocation

Sector	Value
Corporate	52.12%
Government	41.33%
Cash Equivalent	6.54%

Credit Quality

Rating	Value
AA	8.59%
AAA	91.41%

Top Securities Holdings / Portfolio

Name	Holding	Value	Quantity
8.51% Govt Stock 2033 Sovereign Bonds \| -	11%	₹662 Cr	65,240,613
National Bank For Agriculture And Rural Development Debentures \| -	5%	₹318 Cr	3,200
HDFC Bank Limited Debentures \| -	4%	₹234 Cr	23,500 ↓ -1,500
Small Industries Development Bank Of India Debentures \| -	3%	₹217 Cr	21,700
Small Industries Development Bank Of India Debentures \| -	3%	₹189 Cr	19,000
Rural Electrification Corporation Limited Debentures \| -	3%	₹160 Cr	1,600
Bank Of Baroda Debentures \| -	3%	₹155 Cr	1,550
Rural Electrification Corporation Limited Debentures \| -	2%	₹151 Cr	15,000
7.38% Govt Stock 2027 Sovereign Bonds \| -	2%	₹141 Cr	14,000,000
Union Bank Of India Debentures \| -	2%	₹140 Cr	1,364

5. Aditya Birla Sun Life Banking & PSU Debt Fund

(Erstwhile Aditya Birla Sun Life Treasury Optimizer Fund)

An Open-ended short term income scheme with the objective to generate income and capital appreciation by investing 100% of the corpus in a diversified portfolio of debt and money market securities with relatively low levels of interest rate risk.

Aditya Birla Sun Life Banking & PSU Debt Fund is a Debt - Banking & PSU Debt fund was launched on 9 May 08. It is a fund with Moderate risk and has given a CAGR/Annualized return of 7.8% since its launch. Ranked 9 in Banking & PSU Debt category. Return for 2022 was 3.7% , 2021 was 3.6% and 2020 was 10.9% .

Below is the key information for Aditya Birla Sun Life Banking & PSU Debt Fund

Aditya Birla Sun Life Banking & PSU Debt Fund Growth
Launch Date	9 May 08
NAV (22 Aug 23)	₹317.783 ↓ -0.04 (-0.01 %)
Net Assets (Cr)	₹8,400 on 31 Jul 23
Category	Debt - Banking & PSU Debt
AMC	Birla Sun Life Asset Management Co Ltd
Rating	☆☆☆☆
Risk	Moderate
Expense Ratio	0.7
Sharpe Ratio	-0.01
Information Ratio	0
Alpha Ratio	0
Min Investment	1,000
Min SIP Investment	1,000
Exit Load	NIL
Yield to Maturity	7.5%
Effective Maturity	4 Years 11 Months 23 Days
Modified Duration	2 Years 6 Months 11 Days

Growth of 10,000 investment over the years.

Date	Value
31 Aug 18	₹10,000
31 Aug 19	₹11,085
31 Aug 20	₹12,198
31 Aug 21	₹12,911
31 Aug 22	₹13,293
31 Aug 23	₹14,140

Aditya Birla Sun Life Banking & PSU Debt Fund SIP Returns

Total investment amount is ₹180,000
expected amount after 3 Years is ₹203,125.
Net Profit of ₹23,125 Invest Now

Returns for Aditya Birla Sun Life Banking & PSU Debt Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 22 Aug 23

Duration	Returns
1 Month	0.3%
3 Month	1.2%
6 Month	3.6%
1 Year	6.2%
3 Year	5%
5 Year	7.1%
10 Year
15 Year
Since launch	7.8%

Historical performance (Yearly) on absolute basis

Year	Returns
2022	3.7%
2021	3.6%
2020	10.9%
2019	9.9%
2018	6.6%
2017	5.6%
2016	12.3%
2015	8.5%
2014	12.5%
2013	9.6%

Fund Manager information for Aditya Birla Sun Life Banking & PSU Debt Fund

Name	Since	Tenure
Kaustubh Gupta	29 Sep 09	13.93 Yr.
Harshil Suvarnkar	22 Mar 21	2.45 Yr.

Data below for Aditya Birla Sun Life Banking & PSU Debt Fund as on 31 Jul 23

Asset Allocation

Asset Class	Value
Cash	17.3%
Debt	82.7%

Debt Sector Allocation

Sector	Value
Corporate	52.96%
Government	41.36%
Cash Equivalent	5.68%

Credit Quality

Rating	Value
AA	3.08%
AAA	96.92%

Top Securities Holdings / Portfolio

Name	Holding	Value	Quantity
Power Finance Corporation Ltd. Debentures \| -	4%	₹326 Cr	32,500
HDFC Bank Limited Debentures \| -	3%	₹265 Cr	265
National Housing Bank Debentures \| -	3%	₹250 Cr	25,000
Small Industries Development Bank Of India Debentures \| -	3%	₹250 Cr	25,000
7.17% Govt Stock 2030 Sovereign Bonds \| -	3%	₹226 Cr	22,567,400 ↑ 14,000,000
HDFC Bank Limited Debentures \| -	3%	₹225 Cr	22,500
7.38% Govt Stock 2027 Sovereign Bonds \| -	2%	₹202 Cr	20,100,000 ↑ 3,500,000
7.06% Govt Stock 2028 Sovereign Bonds \| -	2%	₹159 Cr	16,000,000 ↑ 3,000,000
National Bank For Agriculture And Rural Development Debentures \| -	2%	₹150 Cr	15,000
Power Finance Corporation Ltd. Debentures \| -	2%	₹149 Cr	1,500

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Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.