Chase Manhattan Corp. is firing up a program to get other banks to sell its Vista funds.

Under a campaign dubbed FundCraft, smaller banks with few or no investment products of their own would offer Vista funds as private-label products in a hub-and-spoke arrangement. The hub-and-spoke structure lets a hub investment company manage assets and maintain "spokes," mutual funds offered by other parties that can have different names, sales charges, and expense ratios.

Chase said it plans to make its 750 domestic correspondent banks a major distribution channel for FundCraft. This summer, the sales team dedicated to serving those banks put all Vista funds - including international and U.S. equity, fixed income, tax-exempt, and money market - on its tray of wares.

The sales team claimed that Vista has a competitive advantage over other mutual fund families because of its bank affiliation.

"We really aren't interested in other banks' customers," said Rachelle Spodek, vice president in Chase's U.S. bank client management group. "We want to be the banker for banks. We're selling them everything we can."

Vista funds are already sold to customers that do not bank with Chase. Some 75% of Vista customers bought their funds from an outside broker- dealer or financial planner, according to Steven R. Samson, director of product management for Vista.

Chase's proprietary fund family has $20 billion of assets under management. The funds are to gain $5 billion of assets by yearend when Chase completes the conversion of its common trust assets.

In the private-label fund business, Chase will be competing with money management titans like Goldman Sachs Asset Management, Vanguard Group, Scudder Stevens & Clark Inc., T. Rowe Price Associates Inc., Twentieth Century Securities Inc., and Wright Investors Service.

But Gregory J. diPretoro, vice president of Vista Capital Management, said banks are better off outsourcing to other banks than going to a nonbank money management firm. Mr. diPretoro was trying to drum up interest in FundCraft at the annual Bank Marketing Association investment management and trust conference here this week.

Banks working with nonbanks "have invited the infidel into the camp," he said. "Unfortunately they didn't have much choice."

FundCraft does have a legacy. The former Manufacturers Hanover Trust Co. - acquired by Chemical Banking Corp., which later merged with Chase Manhattan - sold proprietary money market mutual funds through its correspondent bank network.

"There is some affinity and greater willingness for banks to deal with other banks," said William L. Kufta, chief investment officer of Beacon Trust Co., Chatham, N.J. "The mutual fund industry is perceived as a competitor rather than an ally."

Beacon, which has no relationship with Chase, manages $270 million of client assets in individual portfolios. While Mr. Kufta said he has no need for mutual funds, he added that Chase's pitch "will land" at banks.

That is, it may do so as long as those banks have not already linked up with companies like Fidelity Investments, as Valley National Bancorp of Wayne, N.J., has done.

"We use a well-known investment company," said John Rose, a Valley National trust officer.

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