SEI Corp. is planning to sell off some of its investment consulting services in an effort to concentrate on its core businesses of asset management and bank trust and technology services.

The Wayne, Pa.-based company, which offers investment services to banks and other financial services companies, will shed its pension and investment management consulting business. And it will farm out its retirement-plan record keeping to KPMG Peat Marwick, New York.

SEI officials said the move was hastened by concerns, voiced by retirement plan sponsors and some banks, that the company's effort to sell its proprietary mutual fund complex undermined its impartiality as a consultant.

"This is absolutely a strategic decision," said Cris Brookmyer, vice president and controller for SEI. "We've tried to find an answer to the perceived conflict of interest between our consulting business and our asset management."

SEI's consulting services include, among other things, rating and choosing mutual funds for investment portfolio managers or pension and 401(k) plan sponsors.

"They were trying to hold themselves out as an impartial evaluator of mutual fund services, but at the same time they were selling their own mutual funds as well," said Richard A. Davies, managing director of First Chicago Investment Management Co. "It put them in a position of not seeming credible."

Ms. Brookmyer said shedding the ancillary business will let SEI "devote more management attention to the areas we are best at."

SEI has retained Donaldson, Lufkin & Jenrette Securities Corp. to help find bidders for its consulting business.

Some experts said SEI's bottom line also stands to benefit. While the consulting and record keeping businesses brought in 22% of its $263.8 million annual revenue last year, the bulk of its business remains in asset management.

"It's not surprising that they're doing this," said an industry insider who asked not to be named. "Profit margins are shrinking in every line of business, but asset management is still the big money maker."

SEI has more than $20 billion of proprietary mutual fund assets under management. It supplies services to some of the country's larger bank-run mutual fund complexes, including Midlantic National Bank's Compass Capital Group of Funds, First Fidelity's FFB Lexicon Funds, and Union Bank's Stepstone Portfolios.

Though officials at SEI said they were confident the decision to shed the consulting and record keeping businesses would clear up any outstanding conflict of interest questions, some bankers say the effort is not enough.

"The fact that they are out there competing in the money management business is still a concern to us," said a banker, who asked not to be identified. "What about the funds they're out there pushing?"

The rift is serious enough that the bank is considering finding another distributor for its proprietary mutual funds, he said.

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