When it comes to managing institutional mutual funds, no bank has broader horizons than NationsBank Corp.
As of June 30, the North Carolina powerhouse was running $9.1 billion of funds for pension plans, trusts, corporations, and other institutional investors, according to data compiled for the American Banker.
NationsBank's institutional funds run the gamut from equities to taxable bonds, to taxempt bonds. In each of those categories, NationsBank holds a solid lead over other banks.
Changing Times
While the company trails BankAmerica Corp. and PNC Bank Corp. in total institutional assets, those companies derive their strength mainly from money market funds, according to the data from Lipper Analytical Services Inc.
The Breadth of NationsBank's strategy underscores the changing nature of the institutional side of the bank fund business.
More than a decade ago, some banks began offering institutional funds as an outgrowth of their corporate money management activities. Money market funds were about the only product around.
With $5.4 billion in money market funds, NationsBank lagged behind PNC, with $16.4 billion; BankAmerica, with $14.2 billion; and fourth-place Northern Trust Co., with $6.1 billion.
Increasingly, banks are rolling out long-term stock and bond funds in a bid to compete for retirement plan assets, such as 401 (k) programs.
Quarterly Rankings
The accompanying chart, showing the top 25 banks in institutional funds, is the third in a series that will be published quarterly by the American Banker.
On Wednesday, the American Banker published a ranking based on banks' combined retail and institutional fund assets at the end of the second quarter. On Thursday, the newspaper spotlighted retail funds.
The data show that banks managed $102.6 billion in institutional fund assets at midyear. That's a healthy 54% of the banking industry's total $190.9 billion in fund assets.
In other highlights, the data showed:
* The leaders, PNC and BankAmerica, held nearly 30% of the institutional mutual fund assets managed by all banks.
* Money market funds totaled $80 billion, or 77% of bank institutional fund assets. In all, 15 banks had at least $1 million in institutional money market assets.
* Equity funds were the second-largest category, with $12.6 billion in assets. NationsBank had $1.8 billion in institutional equity funds. Three other banks -- Sun Trust Banks Inc., First of America Bank Corp., and Comerica Inc. -had at least $1 billion in such funds.
* Taxable fixed-income funds took third place, with $9.1 billion in institutional assets. The leader was NationsBank, with $1.5 billion.
* Tax-exempt fixed-income funds claimed the least institutional assets: $1.9 billion. Again NationsBank took first place, with $461 million.
* Alone among the top 25 banks in institutional funds, PNC's assets declined during the 12 months.
