Despite fears of a stock market correction, bank brokerage chiefs expect that this year's mutual fund sales will exceed last year's performance.

They are counting on a continued decline in interest rates, which they expect will help both the bond and stock markets.

Indeed, some suggested that sales of mutual funds at banks could reach the heights of 1993, when sales peaked at $29.5 billion, according to the Investment Company Institute. That's almost twice as much as sales in 1994.

"I'm banking on '96 to be my best year ever," said Dale Kaliszeski, president of the brokerage unit at First Commerce Corp., New Orleans.

With short-term interest rates moving downward, long-term bond funds are becoming more attractive relative to certificates of deposit, Mr. Kaliszeski said. And the stock market continues to climb every month.

Bank brokerages sprang back in the second half of 1995 after sales the previous year languished. In 1994, bank brokerages suffered as performances of bond and stock funds plummeted.

As an example, Mr. Kaliszeski said total revenues for his unit in 1995 were 16% higher than 1994, and "about the same" as in 1993.

The optimism of brokerage chiefs comes in the wake of a strong November for fund sales overall.

Net new sales in November were $14.1 billion, up 18.5% from October, according to the institute.

Data from the Washington-based mutual fund trade group reveal the increase was fueled mostly by stock fund sales, which captured $11.9 billion, up 21.4% from October. Net new bond fund sales remained flat at $2.2 billion, compared with $2.0 billion in October.

Sales increases continued for banks into December. The current interest rate helped make December the best month last year for sales of mutual funds at StarBanc, according to the Cincinnati-based bank's brokerage chief, Randolph Bateman.

He said the most popular fund selling at his unit is Star Strategic Income Fund, which attempts to gain higher yields than CDs. "To have a constant or even lower interest rate environment would be ideal for our strategic income fund," Mr. Bateman said.

Even a potential stock market correction doesn't stifle Mr. Bateman's optimism. He said stock investors remained resolute even during a few minor corrections this year.

Bank brokerage chiefs also insist their brokers are more experienced sellers of mutual funds, and they are diversifying customer portfolios to protect them from corrections.

Still, brokerage chiefs and their investment representatives acknowledge a downfall in stocks is their chief concern."The reps are afraid of the market tapping out," said Drew Kagan, president of Cincinnati-based Provident Bancorp's brokerage subsidiary.

Mr. Kagan is telling his staff of 14 brokers to keep in touch with customers, and to diversify their portfolios. His brokers are promoting balanced funds, which split their portfolio of investments between stocks and bonds.

Mr. Kagan said sales in December jumped 80% over November. The most popular funds include the bank's own Riverfront Flexible Growth Fund and Riverfront Income Equity Fund.

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