J. Edward Diamond, president of Dime Securities, didn't waste any time upon learning in January that its parent company had merged with Anchor Bancorp.
Mr. Diamond and other managers of Dime Bancorp's securities brokerage subsidiary spent several days scouting Anchor branches in the New York metropolitan area, seeing how the savings bank was going about selling investment products.
The executives then paid visits to Brooklyn-based Dime Bancorp's branches, to get a fresh look at their in-house program.
The conclusion reached after days of detective work: both sales forces warranted beefing up, and selling strategies required revisions.
Mr. Diamond decided that instead of quickly combining the Dime and Anchor programs, he and his staff would slowly cull the best from both to create a single superior operation.
That effort is just about complete, and Dime's top executives applaud the enterprise.
"We are very interested in investment products," said Lawrence J. Toal, Dime Bancorp's president. "They are what our customers want."
The merger of Dime and Anchor, two of the largest savings banks in New York, "was very appealing from an investment services point of view," Mr. Diamond said.
Anchor brought to the equation a very active fixed annuity program, with sales handled by customer service representatives. The Hewlett, N.Y., savings bank also supplied a "vast storehouse" of untapped mutual fund customers, because securities sales were never played up, Mr. Diamond said.
Anchor's approach happened to complement Dime's, whose own operations emphasized mutual fund and securities sales. The brokerage culture is now being instilled at Anchor's 60 branches, where 35 sales representatives are being added.
At Dime's 34 branches, brokers continue to offer a full range of investment products, including mutual funds and annuities. And taking a page out of Anchor's book, customer service representatives in Dime branches will begin selling annuities.
To neutralize potential competition between the brokers and customer representatives, Dime will pool annuity commissions and divvy them between the two groups.
"Clearly we do not want our sales forces fighting over the customer base," Mr. Diamond said.
In fact, in an effort to foster greater camaraderie between brokers and customer service staffers, Mr. Diamond has put in place a "player-coach" system. Under the arrangement, individual brokers offer selling techniques to their group of seven or eight customer service representatives.
The teamwork approach is innovative, and hardly surprising for Dime, industry experts said.
The savings bank's investment sales program "is one of the best in the county" from a selling and professionalism standpoint, said Kenneth Kehrer, president of Kehrer Associates, Princeton, N.J.
Industry observers place much of the credit with Mr. Diamond, who has been with Dime for four years. While declining to disclose figures, Mr. Diamond said profits during his tenure have grown 72%.
Mr. Diamond came to Dime from investment products marketing firm Invest Financial Corp. At Invest, he oversaw an investment program for Chemical Bank. He has also managed brokerage offices for Prudential Securities and Shearson Lehman Hutton.
An avid scuba diver, Mr. Diamond has earned a reputation for seeing opportunities below the surface.
He demonstrated this knack last year, when Dime was watching investment product revenues slip from $16 million in 1993 to $12 million.
Rather than accept a commensurate drop in income, Mr. Diamond looked at brokers' pay, and decided the bank could save money by adopting a commission structure that favors top performers.
As a result of the compensation change, the brokerage's net profit margin fell just a few percentage points, compared with a larger drop in revenue.
"I'm comfortable we managed the business as aggressively as we could under adverse business conditions," Mr. Diamond said.
He applies just as sharp an eye to the brokerage's management team, which consists of four officers and three regional sales managers.
"We haven't let ourselves get padded with overhead," he said.
The brokerage's headquarters conveys these sentiments, with its small, sparsely furnished offices overlooking downtown Brooklyn.
Dime offers its customers a limited number of mutual funds and annuities from companies like Putnam, Oppenheimer, and Mutual of Omaha.
So far this year, fund sales have remained sluggish and annuity volume strong, Diamond said.
He expects $20 million in revenues, or commission income, from the combined mutual fund and annuity operation this year.
Mr. Diamond also continues chipping away at a personal goal. Right now, 16 percent of Dime's branch customers have purchased investment products from the savings bank. Anchor has about one-third of that penetration, or five percent.
Mr. Diamond wants to bring Anchor's penetration to Dime's level, and them grow the two toward the 20% mark.
Put another way, there are 30,000 customers who have bought investment products from either Anchor or Dime. "We have the potential to double that," Mr. Diamond said.
