Shawmut National Corp. found out the hard way last week that marketing mutual funds to ordinary depositors can be a touchy business.
When two of the bank's mutual fund salesmen paid a visit to the home of a 93-year-old man who had $6,000 in maturing deposits, the story landed on the front page of The Boston Globe business section.
The article, which ran under the headline "When Your Bank Brings Risk to Your Door," warned consumers that banks are getting pushy in marketing their mutual funds.
"It's hard to find a doctor who makes house calls these days, but some bankers seem to think that house calls are worth a try," The Globe said.
The article was clearly a public relations setback for Shawmut. Though admitting it found no evidence of wrongdoing, The Globe singled out the Hartford, Conn.-based company for taking more of a hard-sell approach than most of its rivals.
Shawmut, for its part, played down the incident. Brent DiGiorgio, a bank spokesman, maintained that Shawmut employees made the house call only after the customer requested it.
"He invited us to his home," Mr. DiGiorgio told American Banker. "It kind of quells their hot story that banks are foisting mutual funds on their clients."
Agreed to House Call
The article recounted how Shawmut tried to interest John Strickland, a retired executive from Roxbury, Mass., in the bank's mutual funds.
According to the report, a Shawmut employee working from a list of customers with maturing CDs phoned Mr. Strickland. The employee asked him if he would like to stop by the branch to discuss moving some of his $6,000 into a Shawmut mutual fund.
Mr. Strickland declined, because he had been ill, but he told The Globe that he accepted the bank's offer of a house call.
A day or two later, the paper reported, two bank employees appeared at Mr. Strickland's door.
While he said the employees were "very nice," he decided to stick with CDs. "At this point in my life, I don't need to get rich," he told The Globe.