Boatmen's Bancshares is thinning the ranks of vendors servicing its proprietary mutual fund family and the Bisys Group has emerged as the winner.
Under the agreement announced Monday, the St. Louis-based bank is expanding the servicing role played by Bisys, a Little Falls, N.J., company that currently serves its Pilot Funds as an administrator, distributor, and transfer agent.
Early next month, Bisys will replace State Street Boston Corp. as accountant for Boatmen's Pilot Funds. Bisys, already transfer agent for all insititutional shares and all classes of a small-cap fund, will become the sole agent for the fund family.
Bisys will replace Primary Funds Services Corp. as the transfer agent for retail classes of six Boatmen's funds. And in July, Bisys will supplant National Financial Data Services, a State Street subsidiary, as transfer agent for its international mutual fund.
"For anyone in a position like mine, dealing with fewer providers gives the funds greater leverage," said David F. Toth, a senior vice president at Boatmen's Trust Co. and director of the $5.3 billion asset Pilot fund family.
Boatmen's is the latest bank to pare down its stable of fund servicers in an effort to reduce costs and better coordinate the services it receives. In many instances, Bisys has been the fund servicer left standing.
Although both parties declined to reveal the financial terms, Mr. Toth said the Pilot funds would save 10% to 15% in fund accounting and transfer agency fees as a result of the change in vendors.
Mr. Toth said Bisys won a competitive bidding process among a half-dozen vendors despite the fact that it did not submit the lowest bid.
"We've never professed to be the low-cost provider but we do think we provide the most value added," said David Huber, president of Bisys Group's fund services division in Columbus, Ohio. "The proof over time will be if we help grow their assets faster."