As far as Albert H. "Chip" Elfner is concerned, it's better late than never.

The president of Keystone Group Inc. readily admits that the Boston-based mutual fund company lags behind competitors in marketing its products through banks.

But he said the company, which is the country's 32d-largest mutual fund manager according to the Investment Company Institute, is getting fired up to succeed in the bank market.

"Sometimes you get lost in the shadow of the competition," Mr. Elfner said. "So we have to be agile and creative to compete effectively."

Perhaps it's in the air at Keystone's Berkeley Street headquarters, which were previously populated by Massachusetts Financial Services. This Boston-based rival has already become a leading marketer of mutual funds through banks.

While Keystone may be able to fill Massachusetts Financial's old office space, analysts say it will be hard pressed to duplicate the firm's success with banks.

"They haven't registered in a major way on bank radar screens," said Eli Neusner, a consultant with Cerulli Associates, in Boston.

But Mr. Neusner agreed that Keystone was making the commitment to turn this situation around.

"They're bringing on some good talent and devoting the necessary resources,"

Mr. Neusner said.

Keystone's annual mutual fund sales, between $2 billion and $2.25 billion of assets a year, have traditionally been through brokerage firms and financial planners.

The goal is to build sales through banks to between 25% and 30% of total sales over a five-year period.

To do that, Keystone began developing a dedicated sales force last year to serve banks and hired several people with experience working in banks to staff it.

With .a few notable exceptions, including Aim Management Group Inc., Federated Investors, and The Pioneer Group, it has been relatively rare for mutual fund companies to raid banks for talent.

"Being a little late to the game, we needed to look for senior people who were more experienced," Mr. Elfner explained.

One recruit is Peter M. Delehanty, who was wooed away from Seattle-based Washington Mutual Savings Bank, and is now senior vice president of Keystone's bank sales division.

Mr. Delehanty thinks the flat markets this year give Keystone an opportunity to win some business.

"Banks are looking at who they are doing business with and why," he said.

To be sure, Keystone already has had some success among banks.

For example, it has gotten Barnett Banks Inc., Summit Bancorp., and Hibernia National Bank to sell its mutual funds.

To become more attractive to bank clients, the company is offering training services, which many banks reportedly like and need in order to get up to speed on the latest marketing strategies.

Keystone is also focusing on sales to mid-sized banks, with assets of $2 billion to $10 billion.

Company officials believe this is a better approach than targeting larger banks that are already chock full of investments to sell.

Keystone has also linked up with a number of marketing firms, such as the Laughlin Group of Companies, Liberty Financial Cos., Wall Street Investor Services, and Investment Centers of America, that already have relationships with banks.

"I can save a lot of time, effort, and money by partnering up with third-party marketers," Mr. Delehanty said.

Keystone is betting that its willingness to be flexible will help it win a greater share of banks' business.

"You don't have to change the way you do business. We'll change the way we do ours," said Edward J. Falvey, president of Keystone Investment Resource Center, the company's back office and administrative unit.

Keystone also hopes to gain an edge through its marketing approach. Rather than selling to investors directly, the company only sells through financial intermediaries.

This should help alleviate suspicions among bankers that mutual fund companies that sell directly to consumers may take away business from banks. Such direct sales reap higher commissions than sales through intermediaries.

"We don't have a side-car agenda," said Ralph Spuehler, president of Keystone's mutual fund distribution subsidiary.

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