Since the inception of NBD's Woodward proprietary funds, the bank has handles most services internally.

NBD serves as transfer agent and investment adviser and also provides shareholder services in house. Only distribution is handled by a third party.

If you have the capacity internally to administer proprietary funds, you can produce a more cost-efficient product.

But the key is to have it in place, instead of having to build it up from scratch.

Right now, administration and distribution for our Paragon funds is handled by Goldman Sachs. Goldman also serves as our transfer agent, and we use State Street for custody.

Our attitude, and part of it is predicated by our size, is that it is better to use outside companies to adminsiter our funds.

First of all, it's less expensive to utilize someone outside. In this business, the profit margins are slim. and considering the liabilities involved, we also think it's good idea to use outside help.

We do a good percentage of our administrative work in house now. In fact, as an organization, we are one of the only regional companies that offers services for other companies.

We've had capabilities in house for shareholder services since the late '60s. We serve as transfer agent and do shareholder servicing ourselved for about 150 mututal funds nationally.

Because of Glass-Steagall restrictions, distribution is handled externally by the sunstone Financial Group. In the long term, we would like to bring more fo the business in house.

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