Setting up a mutual fund supermarket may not be for every bank, according to two fund services consultants.

"It's a tough row to hoe to become a sponsor," said Lisa Hurley, general counsel at Bisys Group in Little Falls, N.J.

Though some banking companies, like NationsBank Corp. in Charlotte, N.C., have begun their own supermarkets, most will find that "it's better to participate in one," Ms. Hurley said.

Ms. Hurley, speaking at a Bank Securities Association conference here last Friday, was on a panel examining the pros and cons of getting involved in a fund mart.

The concept of the one-stop shop offering no-load, no-transaction-fee mutual funds was first made popular in the OneSource program started by San Francisco-based Charles Schwab & Co. in 1991.

Since then, banks and brokerages have sought to copy the formula that let Schwab attract 18% of all the cash flow into mutual funds, Ms. Hurley said.

But Schwab's formula is probably inaccessible to most banking companies, said Ms. Hurley. "They spent a gazillion dollars to get there," she said.

Banks can capitalize on the popularity of fund marts by offering their proprietary funds through oneif they lack the heft to sponsor a mart.

Initially, "people were leery about joining Schwab or Fidelity," said Richard D. Sincere, president of Sincere & Co., a Holliston, Mass., fund marketing firm. Now, he said, "you have to be on one" in order to get exposure for your mutual funds.

Banks may be put off by finding their mutual funds jockeying for position against thousands of others in OneSource or another program, but there are definite advantages, said Mr. Sincere.

With Schwab and Jack White & Co., for instance, banks get to take part in conferences where they can pitch their funds directly to investment advisers.

Another possible approach is the "hybrid" strategy. Instead of building their own supermarket program, banks could license a fund mart product from another institution and offer it to their customers as part of wrap program, said Ms. Hurley.

First Union Corp., Charlotte, and KeyCorp in Cleveland, each licensed OneSource from Schwab last year in the hybrid approach.

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