In a new twist on cash management accounts, Fleet Financial Group is launching an account that sweeps the funds of private banking clients between deposits and investment and trust accounts.
Boston-based Fleet is testing the product in Maine and New Hampshire and plans to offer it to all customers in January.
The account differs significantly from traditional cash management accounts. Those products usually move money between deposits and brokerage accounts or mutual funds-not individually managed portfolios or trusts.
The new feature at Fleet enhances the Financial Management Account that moves funds between deposits and Fleet's Galaxy mutual funds.
About 4,500 private clients have signed up for that account since April- and Fleet is targeting another 15,000, or more than half its private-client base. Fleet's private clients typically have more than $500,000 to invest and have six to 10 accounts with the bank and its subsidiaries.
With the new feature, clients can write checks against cash in investment portfolios and revocable trust accounts. The account charges a $25 monthly fee if combined deposit and investment balances drop below $100,000. For accounts that include loans (except mortgages), the fee is imposed if the combined balances dip below $200,000.
The account's statement, typically more than 20 pages, features a front- page summary with pie charts of all investment, deposit, and loan activity.
When clients "consolidate all of their assets on one statement and get one view," they might be inclined to move more business to Fleet, said Vincent McCrystal, a vice president and project leader for the new account.
Putting private clients on the same computer platform also helps the banking company keep track of its most valuable sales prospects.
"There's an internal desire as well as an external marketing desire," said Robert M. Tetenbaum, executive vice president of First Manhattan Consulting Group, New York.
The next enhancement, to become available this month, is to be a link to six-figure lines of credit. That is to be followed, next summer, with access to brokerage accounts; information from them is now included on the statement.
Fleet also has a cash management account for mainstream customers. Known as Fleet One Gold, this connects brokerage, mutual funds, checking, savings, and credit cards. Its statement, however, is not as detailed as the one for the new private-client account.