Metropolitan Life Insurance Co.'s plan to enter the bank-investment products market may prove to be costly and difficult, observers say.

The nation's second-largest insurer is expected to set up a third-party marketing firm to sell insurance and mutual fund products of various companies, along with individual securities, in bank branches.

Because banks are often reluctant to push a single vendor's products, Met Life's approach could give the insurer a leg up in the sector, some observers agreed. But the plan is not without pitfalls.

Met Life will have to convince would-be bank clients that it is serious about selling a wide range of products - not just those that bear the Met Life name. The insurer may also have trouble finding skilled agents who want to sell investments and insurance at a bank.

Moreover, the third-party marketing business is contracting, as banks continue to bring their investment programs in-house.

"They've got so many resources, it would be easy for them to design" a bank program, said Valerie Jordan, a bank insurance consultant in Belchertown, Mass. "But the challenge for them is learning the banking industry's culture."

Met Life is staying tight-lipped about its plans for the bank channel, as the push could anger its fleet of 11,000 career agents. Under contract to push mostly Met Life products, these agents consider banks staunch competitors.

But observers said that Met Life is most likely to target community banks, which typically don't have the resources to operate full-service brokerages on their own. Whether these banks would turn to the New York insurance giant to do it for them remains to be seen.

"It sounds like a good idea that would appeal to banks our size," said J. Pinkney Kellet, president of Coastal Federal Investment Services, the brokerage at $425 million-asset Coastal Federal Savings Bank, Myrtle Beach, Md. "But my question would be, are they going to push proprietary products."

According to Met Life's insurance competitors, its plan for banks' may present a costly logistical problem. The company would either have to recruit new agents willing to work where Met Life has snared a bank client, an Aetna official said, or it would have to relocate agents to areas they would prefer not to go to.

"I don't imagine their agents are lining up waiting to get assignments in bank branches," said the official, David Sanderford, senior vice president of financial institutions division at Aetna Life Insurance & Annuity Co.

Making matters more difficult for Met Life, there are already more than 400 third-party marketing firms pitching for business from banks. As most larger banks now manage their brokerage programs themselves, third-party marketers are now fighting over community banks - the same sector Met Life is likely to target.

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