Chase Manhattan Corp. is forging ahead with plans to expand its mutual fund family even as it prepares to merge with Chemical Banking Corp.

Vista Capital Management, Chase's money management arm, plans to add three new international stock funds by Nov. 1 and a high-yield bond fund by Jan. 1, said Steven R. Samson, Vista's vice president for product management and marketing.

Also by Jan. 1, Chase will launch a print advertising campaign aimed at increasing the brand-name recognition of the Vista Funds, he said.

Vista Capital got the green light from Chase's top management to proceed with all product launches for the rest of the year. But it's still not clear whether Chase or Chemical would ultimately call the shots in a combined $14 billion mutual fund business.

"We anticipate that some funds will be merged and others will be left alone, but no firm decisions have been made," Mr. Samson said in an interview. The merger is slated to close in the first quarter of 1996.

Retail shares of the three new international stock funds - Vista Japan Fund, Vista European Fund, and Vista Southeast Asian Fund - will carry a 4.75% sales fee and will be sold through Chase's private bank and its brokerage unit, Chase Manhattan Investment Services. Institutional shares of the funds will be available through 401(k) retirement savings plans as well.

The high-yield bond fund will be subadvised by Offit Bank, New York, Mr. Samson said.

In addition, he said, Vista will increase the number of its wholesale representatives to 15 from 10 in a bid to drum up sales through broker- dealers outside the bank channel.

"This merger will place us right behind Janus (Capital Corp.) in assets," Mr. Samson said. "And with Chemical's Hanover Funds, we will have a good line of money market funds to market to institutional and high-net- worth investors."

Chase is well-known in the industry for its savvy marketing of the Vista Funds outside the bank channel, where some observers estimate the unit derives 75% of the funds' sales. Last year, Chase raked in $13.5 million in mutual fund advisory fees, according to Lipper Analytical Services, Summit, N.J.

But it's Chase's expertise in managing stock funds that should secure a spot for many of its managers after the merger, because the funds bring in higher management fees than either money funds or bond funds, said Avi Nachmany, a partner with Strategic Insight, New York.

As of June, nearly 36% of Chase's total mutual fund assets was in stock funds, compared with 4% for Chemical, which has 92% of its mutual fund assets in money market funds.

Mr. Nachmany and other industry observers have said the latest developments support the expectation that Chase's current retinue will retain most of the control over the mutual fund operations at the new banking company.

"I know Chemical is calling the shots in other areas of the bank, but it just doesn't make sense that they would take over the mutual fund unit," Mr. Nachmany said.

But one consultant who has worked for both companies said the lines are not clearcut for Chase or its Vista unit.

"I've seen enough situations where outwardly it's touted as a merger of peers, but when it comes down to choosing who manages what, the best aren't always picked," the consultant declared.

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