Seeking to capitalize on its relationships with small business clients, Hibernia National Bank has introduced a 401(k) plan aimed at companies with 50 or fewer employees.

Officials of the New Orleans-based bank said the plan will simplify record keeping for companies that sponsor the popular retirement savings plans for their workers.

"Small businesses traditionally have had difficulty handling the heavy administrative demands associated with starting and maintaining a tax-qualified retirement plan," said Kenneth A. Rains, executive vice president of Hibernia's trust division.

Assets of 401(k) plans, which enable employees to reduce their taxes by earmarking a percentage of salary for retirement, exceed $1 trillion and are expected to grow rapidly in the next decade.

Extending Existing Business

Banks see the 401(k) business as a natural outgrowth of corporate banking and are eager to bring these assets under management.

Hibernia is a $5 billion-asset bank which has invested more than $1 million to bring the plan to market.

The plan includes the development of new PC-based software that will help business owners keep track of employees' retirement assets.

Participants will be able to choose among 11 investment options.

For now, the choices are limited to Hibernia's proprietary Tower Funds and Fidelity Investment's Advisor Funds. But the bank said it expects to add other name-brand funds by yearend.

Hibernia has offered 401(k) plans for large companies for some time, but saw-an opportunity to tap into an underserved market, according to Mr. Rains. Filling a Niche What's happening: Hibernia National Bank ismarketing a 401(k) plan Target market:Companies with 50 or fewer employeesKey featires: * Daily valuation of accounts * Telephone access toaccount data for planparticipants * 11 investment options,including Fidelity AdvisorFunds and Hibernia'sTower Funds

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