NBD Bancorp., a leader in the bank mutual fund business, is adding five new fund portfolios to its Woodward lineup.

Richard Foersterling, first vice president at the Detroit-based banking company, said he expects the new funds to hit the market on Jan. 1.

The additions include an international equity fund, a balanced fund, and a U.S. government fixed-income fund, he told a recent Bank Securities Association conference.

As of Sept. 30, the Woodward Funds were the seventh-largest bank-managed mutual fund family, with $5.5 billion of assets spread across 15 portfolios, according to Lipper Analytical Services, Summit, N.J.

Filling Gaps

In his presentation to the Bank Securities Association, Mr. Foersterling said NBD is adding the funds to fill in gaps in its product lineup.

He said the bank is also looking at ways to leverage its mutual-fund management expertise.

Unlike most banks, which outsource specialized tasks such as transfer agency and shareholder servicing, NBD handles these jobs in-house.

The bank uses an outside firm, First of Michigan Capital, for only one mutual-fund-related duty, that of distributor.

And that's because the Glass-Steagall Act expressly prohibits banks from distributing their own funds.

The bank sells an array of investment products through its 143 Charter Point investment centers, and is currently booking sales of $40 million per month, on average.

Mutual funds account for 60% of that volume, and the Woodward funds outsell nonbank mutual funds by better than two to one, Mr. Foersterling said.

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