First Union Corp. has hired a Putnam Investments executive to lead a quantitative analysis unit that is trying to boost its capabilities in institutional asset management.

William E. Zieff, who was chief investment officer of Boston-based Putnam's global asset allocation group, joined First Union this week as a managing director to lead the new effort.

The global structured products group is headquartered in Boston. It is part of First Capital Group, which manages $70 billion on behalf of pension plans, trusts, foundations, endowments, and corporate customers.

Quantitative analysis has grown in popularity recently as investment companies looking to outperform benchmark indexes have turned to more sophisticated analytical methods. It uses mathematical models that factor in securities data, economic forecasts, and other information to help companies develop investment products.

First Union, which is based in Charlotte, N.C., says creating the global structured products group shows its commitment to institutional asset management, said Dennis Ferro, chief investment officer of First Capital Group.

"We felt we had a strong menu of traditional investment products," Mr. Ferro said. "To expand our capabilities, we needed to add more structured offerings."

Mr. Zieff, 39, who reports to Mr. Ferro, plans initially to hire about 12 staff members, including portfolio managers, research analysts, product development, and distribution personnel.

The group will develop its models using large- and medium-cap equities supported by a core strategy utilizing value and growth stocks, Mr. Zieff said. First Union is focusing on domestic clients for now but will eventually expand to attract overseas investors, he added.

Two-thirds of First Capital's assets are in fixed income, with the balance in equities. The fixed-income assets are split between bonds and specialty offerings, such as enhanced money markets, Mr. Ferro said.

First Union has been expanding the capital group through acquisitions and internal growth.

A year ago it bought Tattersall Advisory Group of Richmond, Va., a money management shop with $5.5 billion of fixed-income assets. Tattersall, which kept its name and still has its headquarters in Richmond, manages assets for high-end corporations and pension plans.

Two years ago First Capital Group took on $17 billion of institutional assets through First Union's purchase of CoreStates Financial Corp. The purchase included a unit, Meridian Investment Co., that had 44 investment professionals and six salespeople.

First Union is among the first banking companies to create a quantitative-analysis unit, said Burton Greenwald, managing director of B.J. Greenwald Associates, a Philadelphia consulting firm.

The move puts First Union on a par with large investment management companies, Mr. Greenwald said."Customers are asking for the next step from plain-vanilla offerings," he said.

Deutsche Bank AG of Frankfurt also is building a quantitative analysis unit, which has added 15 investment professionals in recent months.

Mr. Zieff's responsibilities at Putnam have been taken on by William Landes, co-leader of the department, a spokesman said.

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