As banks search for fresh sales outlets for the mutual funds they manage, they are increasingly setting their sights on financial planners.

In the three years through 1995, mutual fund assets controlled by financial planners on behalf of their customers soared more than sevenfold, to $50 billion, according to Cerulli Associates, Boston. This year, financial planners are on track to add another $14 billion to their coffers, and asset growth is expected to accelerate from the current rate of 28%.

Mesmerized by this rapid growth, some banks are revving up sluggish sales programs. Others are jumping into the channel for the first time with marketing geared to the 12,500 financial planners who work for fees rather than commissions.

Chase Manhattan Corp. and J.P. Morgan & Co. are furthest along in their efforts to reach financial planners, having targeted the market three years ago. BankAmerica Corp., Banc One Corp., and First of America Corp. are among those that have joined in over the past year.

Financial planning "is a cottage industry that's beginning to grow up," said Steven R. Samson, vice president and head of product management for Chase Manhattan's Vista Funds. "It's an extremely fertile market."

Financial planners typically charge their customers annual fees of 1% of assets in exchange for highly personal service and advice that they say is unbiased by commission pressure.

No one expects bank sales of mutual funds through financial planners to overtake the core business of selling to a bank's own clients. But firms like Bisys Fund Services - a Columbus, Ohio, company that serves as distributor to about 40 banks with $100 billion in fund assets - aren't overlooking any options. And they see substantial potential.

If sales through financial planners "hit 10% of client assets a year, that would amount to $10 billion for our clients," said David Huber, president of the fund services unit of Bisys Group Inc., Little Falls, N.J.

So far, however, banks have barely begun to harvest the bounty. Though Chase is widely cited as the industry's success story in tapping financial planners - its inflows are growing by 35% a year - sales through the channel since 1993 have contributed just $280 million to the $15.3 billion under management in the Vista Funds. Chase hopes to be attracting in excess of $100 million a year in sales through financial planners by 1998, Mr. Samson said.

And though firm figures are difficult to come by, it appears that no more than $1 billion of the $434.1 billion in bank-managed mutual funds nationwide came through financial planners.

Banks that offer no-load or institutional pricing on their mutual funds have an edge in marketing to financial planners, experts said. Because fee- based planners don't work on commission, they have no incentive to steer their customers into funds that levy sales charges.

Mutual fund supermarkets, such as Charles Schwab & Co.'s OneSource, are also critical links to the financial planner market - and typically only no-load funds can get shelf space.

But interesting planners in using a fund is very different matter from pitching products to brokers.

"They don't want to be called, they don't want junk mail, and they don't want to be sent a sleeve of golf balls," said Timothy J. Leach, president of U.S. Bancorp's Qualivest money management and mutual fund unit.

Instead, Mr. Leach said, planners want detailed statistical information about funds, access to portfolio managers, and an outstanding performance history.

An upside for banks, Mr. Leach said, is that planners are unswayed by brand names and are willing to consider lesser-known funds, such as his, that have interesting stories and standout returns.

This summer, Qualivest began touting its small company value fund to planners with help from Bisys, its fund distributor. It has already attracted "several million dollars," Mr. Leach said.

Indeed, Bisys has a special program that helps its bank clients reach planners. It's open to bank-managed funds that pass a Bisys audit for management style and consistency and meet benchmarks for performance and investment risk.

"Performance is everything here," said Mr. Huber. "You can't make anything positive out of lousy performance."

So far, 25 funds from the more than 500 bank funds Bisys serves have qualified, Mr. Huber said.

Some planners question if bank funds have what it takes.

"I'd look at a bank fund more skeptically," said James E. Putman, a financial planner in Appleton, Wis. "Most bank funds are managed by employees and not entrepreneurs, but ... entrepreneurs make better fund managers," he said.

But others are more receptive. "We do use some bank funds, but usually where they're serious institutional funds" said Harold Evensky, principal at the planning firm Evensky Brown & Katz, Coral Gables, Fla. He counts a J.P. Morgan and a SunTrust equity fund among the core stock funds he recommends.

Expense ratios and risk-adjusted performance are critical factors, regardless of who actually manages fund portfolios.

"We're not interested in the fact that a bank has a lot of marble and has been around for 200 years," Mr. Evensky said.

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