professionals from First Union Corp. have decided it is time to strike out on their own.

Their investment boutique, StoneRidge Investment Partners in Malvern, Pa., was founded Oct. 1 by Joseph Stocke, Philip Brown 2d, Daniel Cook, and Lester Rich -- all former senior managers at Meridian Investment Co., a First Union subsidiary.

Since opening its doors, StoneRidge has more than doubled its staff, hiring another fund manager, two traders, an analyst, and a support person -- all from First Union.

Meridian, where they managed about $2 billion for institutional clients, had been a unit of CoreStates Financial Corp., the Philadelphia banking company acquired by First Union in April 1998. It was originally the investment arm of Reading, Pa-based Meridian Bancorp, which CoreStates had bought two years earlier.

"Within the bank structure, there's always the question of what happens if there's another merger," said Mr. Stocke, who was chief investment officer at Meridian and is managing director of the new company.

"We wanted to be where we were in complete control," he added.

To that end, everyone who came over bought some stock in the new company, which is managing $450 million, primarily in equity-weighted separate accounts for the institutional market.

The sentiment expressed by Mr. Stocke and his partners is not new, said Burton J. Greenwald, a Philadelphia-based mutual fund analyst. At an independent fund company a manager can expect compensation based on the performance of his or her fund, Mr. Greenwald said. At a bank holding company, where the investment unit is usually a small part of the overall business, fund managers must participate in stock options as everyone else does, he said. "It's difficult in the bank environment to keep them happy," he said.

Mr. Greenwald said it is possible other banking companies will imitate PNC Bank Corp.'s recent solution. The Pittsburgh company's asset management unit, BlackRock Inc., recently pursued an initial public offering, the first by a bank-run money manager.

First Union, which manages $67 billion of assets for institutional investors, has appointed Timothy M. Stevenson chief investment officer at Meridian Investment. He previously was a team leader in First Capital's growth-style equity unit and co-managed one of the Evergreen funds.

"The good thing about the breadth and depth of First Union is, we have people who can step in," said William M. Ennis, chief operating officer of First Union Capital. "Our approach has been to have no surprises," he said.

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