Securities dealers are losing their grip on short-term investment management for corporations, a study shows.

The study, conducted by Chicago-based Treasury Strategies Inc., found that securities dealers hold 53% of the market, down from 63% last year. Banks' share, meanwhile, has held steady at 23%, while that of investment managers has climbed to 10% from 4%.

The study was based on corporate liquidity management practices at 496 U.S. asset management clients. Companies participating in the survey all had annual revenues exceeding $50 million.

Anthony J. Carfang, partner at Treasury Strategies, said the rapidly expanding economy means many companies have unexpectedly high levels of operating cash. He placed the total corporate liquidity market at about $300 billion.

Because banks have ready access to the payment system and offer convenient ways to move funds, they may be best positioned to take advantage of the growth in investing.

"Convenience is a factor," Mr. Carfang said. "If the banks can make investing automated and convenient, and all money begins in a bank account, then banks have an opportunity to preempt securities dealers."

Corporations increasingly invest in money market mutual funds, sweep accounts, government securities, and repurchase agreements, and less in commercial paper, the survey showed.

Mr. Carfang said he was surprised to find that about 35% of operating cash investments were managed by executives who spent less than 25 hours a month deciding where to place them.

"Some treasurers have decided to relegate investments to a lower level," Mr. Carfang said. "They are also putting corporate investors on a real short leash by saying, 'You can buy Treasuries, and you can only invest overnight,' so there's no way to screw up."

Securities dealers may "still have a commanding share," Mr. Carfang said, but banks are making inroads by linking cash management and demand deposit services with investment products, enabling a bank to automate investing.

James Graham, executive vice president at PNC Bank Corp., Pittsburgh, said corporations may favor the banking industry's approach to managing corporate assets.

"We try to provide convenience for the customers," he said, adding that just a few short years ago, "banks were more focused on providing cash flow services, but they were not making it really easy to make that investment decision."

Michael J. Rosenberg, vice president at Chase Manhattan Corp., said his bank this year has doubled the attention it devotes to corporate liquidity and investment management products.

He said improvements in the technology for serving asset management clients have brought more business to banks.

"We made it extremely easy for corporations to work with us," said Mr. Rosenberg. "The technology is so advanced now that the investment process is down to a science."

Mr. Carfang said he sees more corporations looking to invest in mutual funds than in past years.

"I think the fund companies are doing a nice job of getting in front of a corporate treasurer and telling their story," he said.

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