Moving to streamline operations, Keycorp will merge seven of its Victory Funds into portfolios with similar investment strategies.

The Cleveland-based banking company is targeting stock, bond, and money market funds that it offers to institutional investors and 401(k) plan sponsors.

The move, planned for this spring, is the latest step in Keycorp's bid to consolidate its funds with products that were managed by Society Corp., which the bank acquired in 1993.

All the products now have the same money managers and have been "blended toward the same investment style over the past year," in preparation of the consolidation, said Keycorp executive vice president W. Christopher Maxwell. "That way you avoid problems."

For instance, a foreign markets fund with $22 million of assets will become part of an international growth portfolio with $87 million of assets.

The melding will allow Keycorp to do away with duplicative efforts in administrative and operational areas, Mr. Maxwell said. The funds will continue to operate with Concord Holding Corp. as administrator and distributor.

"Now we'll pay one, instead of two" legal, accounting, bookkeeping, and marketing fees, Mr. Maxwell said.

By combining funds this way, Keycorp will reduce its outlays by several million dollars a year, he said. And customers will be able to follow the funds in newspapers more easily since there will be fewer Victory portfolios with similar sounding names.

Keycorp wants to make the switch virtually seamless for shareholders, according to a prospectus it mailed last month. Each share will be exchanged for a share in the corresponding fund without any taxes, sales commissions, or transaction fees being levied, the prospectus said.

While moving ahead to enhance fund activities on the institutional side, Keycorp is also taking steps to improve retail distribution, Mr. Maxwell said.

To assist that drive, the bank named Jack Kopnisky as its new brokerage head earlier this year. Mr. Maxwell said the appointment has breathed new life into the Victory Funds' retail distribution.

Sales, he said, "are terrific," with fund assets having risen to $5.2 billion from $4.6 billion at the end of last year.

Mr. Maxwell expects additional assets through a wrap account product Keycorp will unveil in June. The product will cull from Victory funds and outside funds to create an asset-allocation product based on customers' investment goals and risk tolerances.

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