KeyCorp, eager to bolster its international investment offerings, is turning to France's largest bank for help.
A subsidiary of the Cleveland banking company announced Monday that it has picked the asset management arm of Credit Agricole Mutuel to provide international advisory services.
Credit Agricole, based in Paris, has approximately $500 billion in book assets, making it the world's third-largest bank.
The arrangement calls for Credit Agricole's asset management unit, Indocam International Investment Services, to serve as subadviser to KeyCorp's Victory International Growth Fund, which has $200 million of assets.
Indocam, which manages $130 billion in non-U.S. assets, will also provide asset advisory services to Key Asset Management and its clients, said William G. Spears, chairman and chief executive officer of the KeyCorp investment subsidiary.
With the move, KeyCorp joins a string of U.S. banks and investment companies that have recently turned to foreign partners for help in expanding overseas.
"We have $64 billion of assets under management and very little of that is invested internationally," said Mr. Spears. "We feel that our clients ought to have the opportunity to invest internationally."
Such considerations prompted Fleet Financial Group earlier this month to agree to buy a 35% stake in Oechsle International Advisors, a Boston-based company that is now majority owned by Dresdner Bank. Last month, Alliance Capital Management, New York, entered a mutual fund sales and management agreement with Eptaconsors Group, a consortium of Italian banks.
Mellon Bank Corp., meanwhile, has taken minority ownership stakes in asset management firms in Brazil, Chile, and Hong Kong, and has formed an alliance with the asset management unit of Bank of Tokyo-Mitsubishi.
The deal between KeyCorp and Credit Agricole does not give either company an ownership stake-nor does it preclude KeyCorp from pursuing other partnerships, Mr. Spears said.
In the future, he said, he hopes KeyCorp and Indocam will develop investment products jointly or to cross-sell products to their respective customer bases. "There are at least four or five (KeyCorp) products that are of interest to them," he said.
KeyCorp conducted a search for an overseas partner for more than a year before settling on Indocam, Mr. Spears said. The company, which has offices in Paris, Hong Kong, Singapore, and Tokyo, was chosen because it had the broadest exposure to international markets and least exposure to U.S. markets, he said. Roughly $3 billion of Indocam's assets are invested in Asia, with the remainder in Europe.