Instead of being on the defensive, UTI, in fact, said in the presentation that it may hike the repurchase price to between Rs 14.90 and Rs 15, which will mean an additional appreciation of between 2.4 per cent and 3 per cent higher than the acquisition price of Rs 14.55.

Ministry officials hinted that a low rate of interest on likely cash advances by the RBI may also be considered in case UTI faces difficulties in the days ahead. In this case, it is not clear who will finance the interest differential.

The UTI presentation maintained that the annualised return given by US-64, at 18.3 to 19.4 per cent, was substantially more attractive than returns elicited by banks in other so-calledattractive debt instruments.

Sources said that K Kannan of the Bank of Baroda announced a subscription of Rs 100 crore. Similar pronouncements were made by T A Panner Selvam of Union Bank, Rashid Jilani of Punjab National Bank and the chiefs of other banks, including the State Bank of India.

Sebi chairman D R Mehta met finance secretary Vijay Kelkar and discussed the crisis surrounding the Unit 64 scheme. Mehta gave a synopsis of the issues raised by Sebi with regard to the schemes managed by the UTI and the demands made, time and again, by the regulatory body to bring about more transparency in the functioning of US-64.

According to sources, Kelkar is reported have expressed himself against going for a restructuring of the UTI or any of its schemes at this juncture. He advocated that the dust should settle down before the issues are looked into in earnest.

Sebi had consistently demanded that the UTI schemes should be governed by the same set of laws that apply to other mutual funds. After protractednegotiations, former finance secretary Montek Singh Ahluwalia had worked out a complex regulatory mechanism for UTI schemes. Clearly, this format has been found not to be very effective. What is more, the US-64 scheme had been left out of SEBI ambit.

Options, including scarping of the UTI act altogether -- which will bring all UTI schemes under SEBI's regulatory powers -- or bringing about amendments in the Act in order to ensure greater transparency will be among the options that finance ministry will consider at a later date, sources said.