KeyCorp has reorganized its Key Asset Management investment unit to streamline customer relationships.
The bank has broken its asset management customers into three groups- high-net-worth, institutional, and foundation and endowment clients.
KeyCorp has also shuffled some top executives to cater to those customer segments.
Richard Buoncore, who was chief operating officer of the unit, has been promoted to chief executive officer, he said. He succeeds William G. Spears, who remains chairman. Mr. Buoncore will head the institutional asset management group.
Brad Turner succeeds Mr. Buoncore as chief operating officer and will captain asset management for high-net-worth customers, those with $500,000 or more to invest. Mr. Turner had headed the Gradison Funds, the mutual fund unit of McDonald Investments, the local broker-dealer Cleveland-based KeyCorp bought in October. The Gradison Funds will be merged into KeyCorp's Victory Fund unit this quarter, Mr. Buoncore said.
Mr. Turner will co-head the foundation and endowment group with Cindy Koury, who had been a fund manager in that area.
Previously, asset management was very loosely organized at KeyCorp, Mr. Buoncore said. Customers might have had several investment relationships with the bank, depending on how many products they bought.
For example on the institutional side, the bank had 20 people selling 401(k) plans to institutional customers and six selling separate accounts to the same market, Mr. Buoncore said. "So, many times you had one person going in one day and another going in the next day," he said.
Now all institutional, high-net-worth, or foundation and endowment customers will deal with only one bank representative, who will refer customers to a range of products, he said.
Foundation and endowments customers had previously been served alongside individual asset management clients. The company has made it a separate group because "it's a hybrid" of both retail and institutional, Mr. Buoncore said.
The changes are aimed at making Key Asset Management "much more consultative," Mr. Buoncore said, "so that we're not selling products, we're providing the solution." If KeyCorp does not have the product a customer wants, the unit may direct him to another company, he added.
The banking company plans to change the compensation structure to reflect its new approach to asset management. The new incentive program will consist of both revenue sharing and direct compensation for referrals. Previously, employees were not compensated for referrals.