The Bank Administration Institute and the Institute of Financial Education said Friday that they plan to merge July 1.

The Institute of Financial Education will become a division of the BAI, but both nonprofits will continue to market services under their current names. Both are based in Chicago.

The organizations cater to different sectors of the banking industry and different types of institutions, their executives said.

The BAI, which typically serves large banks, organizes conferences, and conducts research. The IFE's specialty is on-site training programs for community banks, credit unions, and thrifts.

"This is a natural step for both organizations," said Thomas P. Johnson Jr., president and chief executive officer of the BAI.

The merger "will enable BAI to diversify its product line and reinforce its leadership position in the marketplace, particularly in the community banking sector," Mr. Johnson said. At the same time, it will "strengthen IFE with additional resources and capital."

The BAI's annual revenue is about $30 million and the IFE's is $2 million, he said.

Richard C. Hartnack, chairman of the BAI's board of directors, said he hopes the agreement marks the beginning of a consolidation trend for organizations that serve banks.

"There's a point at which a consolidated industry has to look to its support structure and say, 'If we're consolidating, it will make sense for you to consolidate too, particularly if we're paying your bills,'" said Mr. Hartnack, who vice chairman of the mostly Japanese-owned Union Bank of California.

The BAI and the IFE will keep their own offices for now, but plan to eventually move in together and share support staff. The BAI has a staff of 100, and the IFE employs 16.

Mr. Johnson will continue as president and CEO of the BAI. E. Dennis Graham will remain president of the IFE and will become an executive officer of the BAI.

Nonprofit groups and trade associations face increased competition from professional conference companies and publishing groups, said Joe Belew, president of the Consumer Bankers Association in Arlington, Va.

Among the publishing groups Mr. Belew cited are American Banker and its sister company Faulkner & Gray, which are both part of Thomson Financial.

Mr. Belew said his group does not have merger plans but has been trying to compete in the conference business by forming alliances with other groups.

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