CHICAGO - Most bankers believe marketing is the critical factor for success in the mutual fund business, a survey by accounting firm Deloitte & Touche has found.

Of 144 banks that responded to the survey, 82% identified marketing as the crucial ingredient for success; 16% cited operations, and 2% said operations and marketing are equally important.

The overwhelming focus on marketing without comparable interest in operations is a mistake, said Thomas J. Lannen, a partner in the accounting firm.

Unwisely Casual Attitude

"What they do is say, |Well, we'll worry about that later,'" he said, referring to operations. "That's their problem."

Mr. Lannen made the comments in an interview after a presentation of the survey results to more than 200 bankers and mutual fund services at a National Investment Company Service Organization conference on servicing bank mutual funds.

The findings, from banks that represent about half of all proprietary mutual fund assets, accurately reflect bankers' attitudes, Mr. Lannen said.

In response to a few bankers who wondered whether the questionnaire had been completed by marketing people, Mr. Lannen said he had no definitive answer. The survey was sent to top officers at 750 banks. Most of thos who completed the questionnaire were in trust departments, he believes.

Customer Services Vital

"A lot of people lose sight of the fact that you've got to retain business," said Timothy J. Prangley, vice president of Union Bank, Los Angeles.

To succeed, Mr. Prangley said, banks must focus on customer services as soon as they log their first mutual fund sale. With so many competitors, there's no time to waste, he said.

"Our feeling is very strong that banking really has a tendency to look at business from a marketing standpoint," said F. Brian Cerini, president of Great Western Investment Management Corp.

The quality of account management and services will be the factors that decide mutual fund program success, Mr. Cerini said.

Despite some banks' focus on marketing, Mr. Prangley said, he doesn't believe most banks are now short-changing quality in operations. The stern warnings sounded in the press about the consequences of mistakes for customer relationships has insured emphasis on doing it right, he said.

As banks pass the euphoric stage of introducing fund programs, they begin to assess soberly the difficulties of offering fund operations, Mr. Lannen said.

In fact, Mr. Lannen said, bankers are recognizing that, despite their squawks about over-regulation of banking activities, mutual fund companies face huge hurdles in meeting regulations. "Mutual funds have been much more heavily regulated," he said.

As more banks begin to calculate fund program profitability, Mr. Lannen said, they are also focusing on the importance of service, in addition to marketing.

Profits Vary Widely

The survey found no clear pattern in bank programs' profitability, he said. Pretax margins for both proprietary and third-party mutual funds ranged from single digits to 70%.

Third-party money market funds were the only exception, with nearly half of those surveyed listing margins of less than 10%.

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