Banks and thrifts have hit a wall in attempts to boost mutual fund market share, a study says, and probably won't do much better in the next five years.

The reason, according to the Sanford C. Bernstein & Co. study: They haven't given consumers much reason to buy from them instead of companies that sell funds directly and with no sales charge.

The market share of commercial banks and thrifts declined to 11% last year from 14% in 1992, according to the study, by Guy Moszkowski, a senior market analyst with the New York-based brokerage firm.

That share will rise in the next five years, Mr. Moszkowski predicts, but only to 13%.

In dollar terms, that would be a huge jump - 78%, to $78 billion. But so-called no-load marketers would gain much more.

These firms are likely to command 49% of the market by the end of the decade, up from 38% in 1992, according to Mr. Moszkowski's research. And financial planners are expected to capture 10% of the market, doubling their 1992 share.

All these gains would come at the expense of securities firms, which sell load funds. Their share of the market has fallen from 38% in 1992 to 30% last year.

"Banks have not differentiated themselves in the eyes of the consumer," Mr. Moszkowski said. "They have not been able to convince mutual fund investors that they are reasonably priced or a high-service source."

This conclusion is at odds a the widespread belief in the banking industry that is it poised to make great strides in the mutual fund business.

Nancy E. Graves, a senior vice president at Mark Twain Bancshares, St. Louis, acknowledges that direct-marketed mutual funds, with their big advertising budgets, have an edge.

"They do a fantastic job of reaching out to the customer," she says.

Eli Neusner, a consultant with Cerulli Associates, agreed. "It's a matter of having the advertising budget to promote the funds," he said. Direct marketers have it, he said. "Banks don't."

But Ms. Graves argues that bank-sold funds have some advantages over their direct-marketed counterparts. For example, she said, her bank emphasizes personal service, such as making sure that a particular mix of investments is suitable for an investor's profile.

Mr. Moszkowski's research suggests that customers have become used to purchasing no-load. When it comes to advice, he concludes, customers would rather go to a financial planner, full-service broker, or a direct marketer.

In terms of "reasonableness" of fund fees, banks trailed direct marketers in the perceptions of investors who were queried by the Investment Company Institute, a Washington-based trade group representing the mutual fund industry.

For example, only 35% of respondents found fees of funds offered through banks to be reasonable, whereas the figure was 80% for the fees of direct- marketed mutual funds. In terms of convenience, most investors ranked banks below everyone else, including insurance companies.

Mr. Moszkowski's conclusions are fueled by a study the Investment Company Institute undertook last summer and released last fall. The study randomly interviewed 720 households that owned mutual funds about their investment practices.

The Bernstein analyst calls the results "exceptionally revealing."

"Most interesting, perhaps, is the loss of momentum of the bank channel," Mr. Moszkowski writes, "even as it is being discussed as a serious contender."

In the study, 50% of respondents indicated they were planning to buy their next mutual fund from a direct marketer, up from 32% for their first fund. Only 3% of those interviewed had a bank in mind for their next fund, down from the 7% who bought their first fund at a bank and the 5% who most recently did so.

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