The American Bankers Association is hitting the airwaves with a promotional piece about mutual funds sold by banks.
An estimated two million television viewers nationwide are expected to see the video news release produced by the Washington-based trade association.
The story, beamed via satellite to 200 television stations on Oct. 20, focuses on the popularity of long-term mutual funds sold by banks, said Ed Alwood, a: spokesman for the trade group that represents commercial banks.
Sales through the bank channel ballooned from $5.7 billion in 1989 to $42.9 billion last year, according to Dalbar Financial Services. That popularity has been spurred by low rates on bank deposits, Mr. Alwood said.
Truth in Labeling
The trade group's communications council, which is made up of bankers, came up with the idea because "we wanted to be sure that consumers understand that these are not insured" products, Mr. Alwood said.
Indeed, the ABA's executive vice president, Donald Ogilvie, cautions consumers that investing in mutual funds can be risky. In the video, he explains that "principal is at risk, and these obligations are not insured by the Federal Deposit Insurance Corp. or the federal government."
In a subtle plug, Mr. Ogilvie mentions that the banking industry is working on guidelines to ensure that customers understand the risks in investment products.
The video also highlights the convenience of buying mutual funds at banks. "Some commercial banks have begun to offer their customers access to mutual funds through ATM machines," Mr. Alwood said. The convenience of buying funds from banks has contributed to the rapid rise in sales, he said.
A video news release is an electronic equivalent of a press release. A news story is transmitted via satellite to television stations. News directors may incorporate any portion of the video into their local newscasts, free of charge.
The first video news release produced by the ABA, aired in June, provided tips on qualifying for a mortgage. A segment about staying out of credit trouble is on the drawing board for the Christmas season, and another on ATM crime is planned for next year.
"I think news directors have become more receptive to them," Mr. Alwood said. "News directors are looking for news that can improve people's lives," he said. "This is news you can use."