SEATTLE -- Seattle-based GNA Capital Management Inc. has introduced four new mutual funds that target holders of certificates of deposit.

The funds, approved by the Securities and Exchange Commission in October, flesh out GNA's product line, which consisted of just one bond fund for sale through banks.

The additions, which join the $1.5 billion-asset Investors Trust Government Fund -- are:

* Investors Trust Adjustable Rate Fund, which seeks yields slightly higher than money market funds. Invested in short-term debt instruments of two years or less, the funds is managed in a sub-advisory agreement by Standish, Ayer & Wood, Inc. of Boston.

* Investors Trust Tax-Free Fund. Brown Brothers, Harriman & Co. managers this national municipal bond fund, which will be limited to investment grade credits. This fund is intended for investors willing to commit funds six years or longer.

* Investors Trust Value Fund, an equity portfolio made up of large-capitalization stocks and corporate bonds. This fund, to be managed by Duff & Phelps Investment Management Corp. in Chicago, brings investors a little farther out on the time line of investments held.

* Investors Trust Growth Fund, which calls for the longest investment. The fund is managed by New York's Value Line Inc.

Expanding the Family

GNA senior vice president David Sanderford said the company decided to expand its product line because "selling a fund family that has only one member is a bit awkward.

"We have also felt from the beginning we were going to not just be in the insurance business and bank marketing but in the fund business as well," he said.

GNA has four lines of business. It is the No. 1 third-party marketer of securities and annuities in banks with $2.5 billion in sales last year; it is the funds business as an asset manager; it manages assets from insurance company annuities, and it collects fees for managing sales forces at banks.

GNA's funds are not to be confused with the recent offering of funds by GNA's parent, General Electric Co.

"We know those people and they know us, and they asked us to sell their funds in the future. If we did, they'd be treated like any other third-party vendor," Mr. Sanderford said.

By expanding its funds offering, GNA could encounter criticism that is often directed against marketing firms that sell their own funds in banks. Marketers without their own funds claim they can do a better job with their clients' funds if there is no inherent conflict of interest.

Mr. Sanderford replied that the GNA sales force and those brokers who work for GNA under contract will pitch the bank's proprietary funds first, then GNA and other funds. GNA employs the sales force in 30 institutions, including Chase Manhattan Bank, and manages sales staffs in 150 banks.

"We tell the banks we will manage training and presentation of our funds to fill in behind their own. We are going to position ourselves as the second funds of choice," he said.

Well-Known Managers

All of the investment firms selected by GNA are well-known names with log histories in investment management.

GNA investments vice president Charles Kaminski said GNA would be uncomfortable having managers with less experience.

"Most organizations have a young MBA sitting in a corner office who's never seen a bear market like 1973 to '74," Mr. Kaminski said.An Expanded LineupGNA's Investors Trust Funds* Government fund* Adjustable-rate fund* Tax-free fund* Value fund* Growth fund

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