Shawmut National Corp. is shopping for fund management firms and mortgage servicing portfolios. Chairman and chief executive Joet Alvord says he wants to expand the bank's investment products and mortgage businesses, and is looking for acquisitions to achieve his goals.
Shawmut has $750 million under management in its six-month-old mutual fund business, but Mr. Alvord says that banks need about $2 billion under management to profit from the endeavor. The executive says he would like to buy an investment advisory or mutual fund company with several hundred million to a few billion dollars under management.
While margins in the mortgage servicing business are compressed because of the rise in prepayments, Shawmut plans to stay in the business and wants to add to its $7 billion servicing portfolio, says Mr. Alvord. "We're looking at the portfolios on the block," he says. "Just when we could consummate a transaction is not clear."