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FinNifty up 250%: How 5 largest banking and financial services funds rode this wave in 10 years
6 min read | Updated on July 03, 2025, 16:35 IST
SUMMARY
AMFI data shows most of these five funds have positive information ratios, indicating they have done well against their respective benchmarks, in longer time horizons. But in 1-year, four of them have underperformed.
Here's how the five biggest banking and financial services funds performed in last 10 years. | Representational image source: Shutterstock
Banking and financial services stocks are on a roll. In the past 10 years, the Nifty Financial Services Index (FinNIfty), which includes most of the top banks and financial services companies, has jumped approximately 250%. The index is up around 12% as of July 2, 2025, in the past six months alone.
The financial services sector has played a key role in spreading financial inclusion across the country in the past decade. In this period, several mutual fund asset management companies (AMCs) have also tried to ride the financial sector boom by launching thematic funds tracking the financial and banking stocks.
In this article, we take a look at how the five largest banking and financial services funds have performed across four different time horizons: 1 year, 3 years, 5 years, and 10 years. Were they able to beat their respective benchmarks in this duration?
Before going further, please note that this exercise is for informational purposes only. You should consult a SEBI-approved financial advisor before investing in any mutual fund scheme.
Thematic funds are theme-based equity mutual funds. The themes they follow could be anything, like banking, consumption, IT, health, railways, and much more. However, we are considering only banking and financial services funds in this article.
For this analysis, we have selected the direct plans of five largest banking and financial services funds based on two conditions:
-
Funds with a minimum daily AUM of ₹1000 crore
-
Funds that have existed for a minimum of 10 years or more
Data on the Association of Mutual Funds in India (AMFI) website as of July 2, 2025, shows there are only five banking-themed funds that meet both the above conditions. All these thematic funds are tracking Nifty Financial Services TRI.
The following tables show how these funds have performed against their respective benchmarks in 1, 3, 5, and 10 years.
Performance of 5 largest Banking and Financial Services Funds in 1 year
| Scheme Name | Return 1 Year (%) Direct | Return 1 Year (%) Benchmark | Information Ratio* 1 Year (Direct) | Daily AUM (Cr.) |
|---|---|---|---|---|
| Aditya Birla Sun Life Banking & Financial Services Fund | 10.53 | 15.83 | -0.98 | 3614.65 |
| ICICI Prudential Banking and Financial Services Fund | 14.59 | 15.83 | -0.31 | 10080.33 |
| Nippon India Banking & Financial Services Fund | 15.12 | 15.83 | -0.16 | 7481.34 |
| SBI Banking & Financial Services Fund | 17.39 | 15.83 | 0.25 | 8562.66 |
| UTI Banking and Financial Services Fund | 14.36 | 15.83 | -0.24 | 1352.91 |
Performance of 5 largest Banking and Financial Services Funds in 3 years
| Scheme Name | Return 3 Year (%) Direct | Return 3 Year (%) Benchmark | Information Ratio* 3 Year (Direct) | Daily AUM (Cr.) |
|---|---|---|---|---|
| Aditya Birla Sun Life Banking & Financial Services Fund | 24.48 | 21.29 | 0.49 | 3614.65 |
| ICICI Prudential Banking and Financial Services Fund | 22.83 | 21.29 | 0.2 | 10080.33 |
| Nippon India Banking & Financial Services Fund | 26.92 | 21.29 | 0.85 | 7481.34 |
| SBI Banking & Financial Services Fund | 26.59 | 21.29 | 0.82 | 8562.66 |
| UTI Banking and Financial Services Fund | 25.22 | 21.29 | 0.66 | 1352.91 |
Performance of 5 largest Banking and Financial Services Funds in 5 years
| Scheme Name | Return 5 Year (%) Direct | Return 5 Year (%) Benchmark | Information Ratio* 5 Year (Direct) | Daily AUM (Cr.) |
|---|---|---|---|---|
| Aditya Birla Sun Life Banking & Financial Services Fund | 24.47 | 21.13 | 0.46 | 3614.65 |
| ICICI Prudential Banking and Financial Services Fund | 24.24 | 21.13 | 0.36 | 10080.33 |
| Nippon India Banking & Financial Services Fund | 28.53 | 21.13 | 0.86 | 7481.34 |
| SBI Banking & Financial Services Fund | 24.83 | 21.13 | 0.53 | 8562.66 |
| UTI Banking and Financial Services Fund | 24.17 | 21.13 | 0.52 | 1352.91 |
Performance of 5 largest Banking and Financial Services Funds in 10 years
| Scheme Name | Return 10 Year (%) Direct | Return 10 Year (%) Benchmark | Information Ratio* 10 Year (Direct) | Daily AUM (Cr.) |
|---|---|---|---|---|
| Aditya Birla Sun Life Banking & Financial Services Fund | 14.92 | 14.48 | 0.05 | 3614.65 |
| ICICI Prudential Banking and Financial Services Fund | 14.9 | 14.48 | 0.02 | 10080.33 |
| Nippon India Banking & Financial Services Fund | 14.53 | 14.48 | 0 | 7481.34 |
| SBI Banking & Financial Services Fund | 17.36 | 14.48 | 0.35 | 8562.66 |
| UTI Banking and Financial Services Fund | 12.49 | 14.48 | -0.3 | 1352.91 |
However, four of them have underperformed their respective indices in the past year. One fund underperformed the index in the 1-year and 10-year durations.
Not all funds beat their benchmark in all time horizons. But there was an exception. SBI Banking and Financial Services fund outperformed its benchmark in all four time horizons.
Will it remain the same? Well, no one can predict the future. Past performances of a mutual fund do not guarantee that it will do the same in the future. Thematic funds, in any way, are a lot more risky than standard funds tracking broader indices.
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