Once relegated to the kids' table of the mutual fund business, there are now more banks than ever before among the top 50 fund companies in the United States.

But that ascent may slow in coming years as the methods banks used to build mass become less effective. Analysts say the maturation of the industry and increases in the competition for assets and the prices of potential acquisitions mean the easy gains already have been won.Thanks in part to consolidation among banking companies, an enduring bull market in equities, and some bold acquisitions of asset managers over the past few years, there were 14 bank-run fund companies among the U.S. top 50 on Dec. 31, according to Lipper Inc., a unit of Reuters Holdings. That's more than twice the number just five years ago.

But banks still have some wood to chop if they want to catch up to the industry leaders. The top three fund companies, all nonbanks, continue to dominate the industry, managing between them about a quarter of the $6.8 trillion of mutual fund assets.

And some observers see the next five years as less promising for bank asset-gathering.

One well-trodden route, converting common trust funds' assets to a mutual fund structure, is closing fast, observed W. Christopher Maxwell, a veteran mutual fund executive who now runs a consulting business, Maxwell Associates in Rockhall, Md.

"There's not much left that you can do," Mr. Maxwell said.

Opinion is divided about whether the fund market has matured so much as to crimp fund sales prospects.

Mr. Maxwell thinks it has. "You're beginning to see some backlash against mutual funds," he says.

That backlash showed up last summer and early fall as a slide in net new cash flowing into mutual funds - which takes into account new sales, redemptions, and exchanges - as investors increasingly shifted their attention to high-growth individual equities.

Christopher M. Condron, president and chief operating officer of Mellon Financial Corp. and chairman of its $117 billion Dreyfus Corp. fund unit, said that though fund sales had been volatile in general, Mellon had held up well.

"Nineteen ninety-nine was a funny year for a lot of mutual fund organizations," Mr. Condron said. Many long-term funds experienced negative flows through November, he noted, but "fortunately, our shop had a good year."

Dreyfus' sales of long-term funds increased 10% last year, with net sales of equity funds reaching $4.1 billion, a company spokeswoman said.

Other bankers reported a similar lack of side effects from 1999 market volatility.

"If the second half of the year is mature, then I'll take mature every day of the week," said William M. Ennis, president and chief executive officer of First Union's Evergreen Funds unit. The $80 billion Evergreen Fund family posted sales of $6.7 billion in long-term funds for last year, 62% more than for 1997, said a spokesman.

Both Mr. Condron and Mr. Ennis attributed asset growth to a push in recent years for broader distribution through third-party brokers and other financial institutions.

"I think that over the last decade banks have taken the asset management business much more seriously," Mr. Ennis said.

And thanks in part to convergence in financial services, banking companies such as KeyCorp are learning sales techniques honed in the nonbank retail brokerage industry.

Since December the Cleveland company has offered up-front commissions to the 800 brokers selling its $19.3 billion asset Victory Funds through its McDonald Investments unit, said John M. Kutz, national sales director for the funds. KeyCorp inherited the so-called G-share structure when it acquired McDonald back in 1998. Sales of the Victory Funds were up 20% in 1999, while assets were up 23%, Mr. Kutz said.

But to really play catch-up, banks may have to make some large acquisitions in asset management similar to Mellon's landmark purchase of Dreyfus in 1994, said W. David Seymour, a partner and national industry director for investment management at KPMG Peat Marwick of New York.

"Every major financial institution - banks too - has a goal to be one of the top five asset managers in the world," Mr. Seymour said. And acquisition is a possible route for all of them, he added.

However, banks may have to be content with organic growth for now, Mr. Seymour said.

"They're tying to be smart about it, because premiums are very high."

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