Norwest Corp. has teamed with two prominent money management firms to introduce a family of annuities.
The lineup, unveiled this week and marketed under the banner of Norwest Passage, includes one fixed-rate and seven variable-rate portfolios.
Under the arrangement, investment management duties will be split between Norwest Investment Management, a unit of Norwest Bank Minnesota; Fortis Financial Group, a financial services company in St. Paul; and Scudder, Stevens & Clark, a New York-based money management firm.
Annuities are tax-advantaged investment products designed to yield a stream of income in the future, typically for retirement. Fixed annuities are paid from fixed-yield instruments, while variable annuity assets are typically invested in mutual funds, which can offer higher returns.
Norwest is the latest in a string of major banks to launch variable annuities linked to their proprietary mutual funds.
Norwest Passage is a natural progression for the bank's growing fund business, said Lee Chase, vice president in charge of the Norwest Funds, a $4.3 billion-asset mutual fund family.
Three of the variable annuity portfolios in Norwest's line will invest in new series of the Norwest Funds, dubbed the Norwest Select Funds, that was created especially for the annuities.
Scudder will provide an international portfolio. The other three variable portfolios will be managed by Fortis, which will also manage the fixed portfolio and serve as underwriter of the annuity contracts.
Norwest hopes to expand the reach of its mutual funds by linking them to similarly structured products, like variable life insurance, Ms. Chase said.