John Nuveen & Co. is preparing to add banks to the roster of distribution channels for its new European stock fund as it continues to enlarge its small stable of equity products.

The Chicago investment company, known in the mutual fund world primarily for its municipal bond funds, introduced its Nuveen European Value Fund late last month.

Now sold through brokerages, fee-based financial planners, and other channels, the fund should become available early this month through banks, said Judson Bergman, managing director of Nuveen's mutual funds.

"We're in the process of gaining distribution at our major bank partners," he said.

European Value is Nuveen's fifth equity fund and its first overseas fund; equity fund assets under management total $1.3 billion, compared with $35 billion for fixed-income funds.

The company plans to introduce an international fund and a global fund within the next year, Mr. Bergman said.

"We're on course to offer a quality range of equity products for investors who are planning for or are in retirement," he said. "That really necessitates quality product offerings in all asset classes."

Nuveen has suffered in recent years as investors have increasingly turned to stock funds and municipal bond funds have fallen out of favor.

Bank sales totaled $650 million last year, but the company anticipates sales through this channel of $1 billion for 1998, said Michael Forstl, vice president and manager of Nuveen's financial institutions group.

Striving to catch up, the company has rolled out four growth and income funds through Institutional Capital Corp., a money manager it bought into in 1995, and a blue-chip growth fund through Rittenhouse Financial Services, which it acquired last year.

Nuveen, which is almost 80% held by St. Paul Cos., a Minnesota-based insurance group, has been criticized for arriving late on the equity side of the business.

Burton Greenwald, a Philadelphia mutual fund consultant, said that such a disadvantage will be hard to overcome.

"They have still got a considerable way to go," he said. Mr. Greenwald noted that the delay means Nuveen has "lost an enormous amount of momentum."

Nuveen decided to launch the European fund, which is managed by Institutional Capital, to take advantage of what Mr. Bergman called the strong fundamentals of Western Europe's economy.

Pension reform, privatization, and the emergence of the European Union make it a promising investment arena, he said.

"Europe's general environment is very similar to where we were in the United States seven years ago as an economy," he said.

As for the two additional funds Nuveen has in the works, they might be managed by Institutional Capital, Rittenhouse, or another money manager.

Nuveen executives have said they are actively exploring buying or partnering with more money management boutiques in order to expand their equity business.

Nuveen manages more than $60 billion of assets, including more than $25 billion in private accounts and unit investment trusts.

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