Responding to a decline in sales through banks, a leading mutual fund company has developed a program to help bank brokers develop leads from branch managers and loan officers.
Boston-based Colonial Group Inc. has been test marketing a program at Chase Manhattan Corp.
The move is the latest in the fund industry's efforts to help bank brokerages cull customers from the traditional side of the bank business.
"We want brokers to explore other opportunities within the bank that they might not have touched upon before," said Craig Howard, director of Colonial's bank division.
At Chase, Daniel Chrzanowski, Colonial's wholesaler for New York State, has been setting up luncheons and dinners between brokers and the bank's branch managers and platform staff.
Colonial is also expected to help brokers at Chase work with branch managers to build a client base of small-business people. Mr. Chrzanowski said he wants branch managers who have contacts with small-business executives "versed on retirement planning," so when they meet their customers "we can bring in the investment specialist."
The mutual fund company is hoping to extend the program to other bank clients by mid-June. The fund company has relationships with 325 banks either directly or through companies that supply brokers to banks.
Colonial's goal is to get bank brokers to establish regular communications with branch managers and loan officers. Brokers are encouraged to write a regular newsletter about current economic trends and what investments are appropriate for the loan officers or branch managers, Mr. Howard said.
Colonial, which has $15.6 billion of assets under management, saw sales of its funds through banks plummet 40% for the last eight months of 1994 as mutual fund performance declined.
But Colonial has found success with its program at Chase. Through the bank, the fund company has sold 15 retirement plans in the program's first month, Mr. Chrzanowski said.
For the past month, the fund company has also been training brokers to solicit their own customers for referrals..
And last year's dismal results aren't hindering Colonial's commitment to banks. Sales of Colonial's funds have tripled since January to more than $2 million, said Chrzanowski.
