Chase Manhattan Corp. is taking on the developing investment market in Italy, amid heavy competition from financial services firms.
The $361 billion-asset banking company has tapped six Italian banks since the fourth quarter to sell its Chase Manhattan Vista Funds, said Cynthia Sweeney, who heads European sales and marketing for Chase global asset management and mutual funds. The unit manages more than $210 billion of assets.
Separately, Chase is pitching its asset management capabilities to Italian pension funds and charitable foundations. The company was recently hired to manage assets for two very large professional association pension funds, Ms. Sweeney said, though she declined to identify them.
Italy had roughly $483 billion of mutual fund assets on June 30, up 20% from January, according to Cerulli Associates Inc. of Boston. The market grew 51% annually from 1994 through 1998, Cerulli said.
"Everybody wants to get in there and get some of that themselves," said Ben Phillips, a consultant at Cerulli.
Chase is up against U.S. companies such as Citigroup Inc., Deutsche Bank AG, Fidelity Investments, and Putnam Investments, which have significant asset management operations in Italy.
Chase will have to deliver high returns to compete effectively, Mr. Phillips said. The company could also benefit from passing along more of the management fee to its third-party distributors in Italy, he said.
It has been trying to increase sales of its offshore funds through third parties for several years.
In addition to Italy, it has third-party agreements in Switzerland, Hong Kong, Germany, the United Kingdom, and the Channel Islands. The company is also registered in France but has not begun distributing its funds to retail customers, Ms. Sweeney said.
Chase has scaled back plans to seek licenses throughout Europe in favor of a more targeted approach, said Sarah E. Jones, the president of Chase Mutual Funds Corp.
Instead, Chase considers "factors of success" in deciding which countries to focus on. Italy is a top priority, she said.
Chase got the green light to distribute 13 funds in Italy during the third quarter of last year. The funds have $5.5 million of assets under management and are registered in Luxembourg. Another four offshore funds, registered in Dublin, are not available in Italy.
Chase's first distribution partner was Banca Popolare Commercio e Industria of Milan. And Banca Profilo of Genova recently agreed to sell Chase funds, as well.
Ms. Sweeney said Chase is talking to several banks, brokerages, and insurance companies but declined to identify them. Chase's 75-year-old commercial and investment banking presence in Italy has been "instrumental" in forging these relationships, she said.
