PaineWebber Inc. has rolled out a 401(k) program aimed at smaller employers-an area of the retirement market generally favored by banks.
PaineWebber's multifund program includes portfolios from its own Mitchell Hutchins group, as well as those offered by OppenheimerFunds, AIM, Pimco, and Franklin Templeton, said J. Richard Sipes, director of retail products at PaineWebber. The plan was officially rolled out last month.
"The clients wanted a multifund opportunity," said Mr. Sipes. "They didn't want to just buy just Putnam, for example," he noted.
The new program may well set it apart from banks and other providers that cater to the smaller plan participant, said Paul Kampner, a 401(k) consultant at TMark Associates in Chicago.
Mr. Kampner noted that banks often get a lot of the smaller retirement account business through their corporate lending divisions, which will hand accounts over to the trust department to maintain client relationships.
But banks typically only serve up their own funds, he noted.
"What you find in the small market is, the more standard it is, the easier it is to make money," he observed.
The PaineWebber program is aimed at plan sponsors with as little as $1 million to invest and as few as 100 participants.
"It's the fastest-growing part of the business," Mr. Sipes said. "The upper-end part of the marketplace is much more established."
He said that the firm has already gathered $80 million, from about 12 companies. PaineWebber is outsourcing the record keeping to First Data Corp., said Mr. Sipes.
This is the first time that PaineWebber has had a proprietary 401(k) program, said Mr. Sipes. He noted that the firm has typically offered a "number of outside choices run by outside firms."
The firm plans to follow up the launching with an advertising campaign in the "appropriate retirement magazines," said Mr. Sipes. It already has an ad campaign under way advertising its overall focus on retirement, he noted.
