BankAmerica Corp., which has spent nearly $70 million this year to prop up its money market funds, is getting a price break from its fund administrator.
Concord Holding Corp., New York, said it will waive $4 million in fees over the next five years to help the Pacific Horizon Funds boost customer confidence.
That is believed to be a sizable chunk of Concord's revenues.
In the company's 1993 fiscal year, which ended March 31, it collected $15.3 million, or 69% of its revenues, from the Pacific Horizon Funds.
Richard E. Stierwalt, Concord's chairman, said the fee cut was intended as a show of support for the banking company, which is Concord's biggest client.
"We want to strengthen and build our Pacific Horizon relationship," Mr. Stierwalt said in a telephone interview.
He declined to say how the San Francisco banking company would use the $4 million. "We're still working things out," he said.
Heavy outflows prompted BankAmerica in May to make a $17.4 million capital infusion to its Pacific Horizon Prime money funds.
Separately, last month the banking company added $50.5 million to the Pacific Horizon Prime and Government money market funds to cover losses from derivative sales.
Concord revealed its plans in a statement confirming that it had, as projected, lost $232,000 on $5.9 million of revenues in the quarter that ended June 30.
In the statement, Concord emphasized that it was voluntarily reducing its earnings on the BankAmerica account, though it had not been "involved in any capital contributions to client fund complexes."
However, one analyst said BankAmerica may have requested a measure of support.
Avi Nachmany, a partner at Strategic Insight, New York, said Concord appeared to be making a gesture of good will for a good client.
"They want to resolve the issue and get on with things," he said.
The move could help both companies put the derivatives episode behind them, Mr. Nachmany added.
During the three months ended June 30, Concord waived about $1 million of administrative fees on the Pacific Horizon funds, and it was also affected by a lower level of average assets under administration, Mr. Stierwalt said.
