allocation product to small and midsize banks. The banking company's Imprint Advisory Services will begin a mass mailing to executives at more than 500 banks and thrifts before the Thanksgiving holiday. "We've invested in the technology, and we know what we're doing," said James McCoy, director and product manager for Imprint Advisory. "We're asking banks to let us in and show them how this can be a profitable product for them." Signet is the first banking company to market an asset allocation product to other banks. Asset allocation products spread an investor's money across several mutual fund portfolios to reduce risk and maximize return, making them an increasingly popular investment alternative. Investors pay a percentage of assets to the bank for managing their money. Under the agreement with Signet, a bank offering the Imprint product could charge customers as much as 125 basis points - of which 60 to 70 basis points would go to Signet. It can take anywhere from one month to several months to train a bank's staff to sell the product and set them up with the asset allocation software necessary, Mr. McCoy said. The longer time may be necessary if a bank is not already registered with the Securities and Exchange Commission as an investment company, he added. The SEC has voiced concern that mutual fund wrap products, as asset allocations are also known, are really mutual funds composed of other funds, and therefore should be regulated as such. Mr. McCoy said that Signet has spent a great deal of money on legal fees and development costs to make sure that regulators' concerns are addressed. "We have a team of people that we bring into the banks that can compress start-up time significantly," Mr. McCoy said. The Imprint unit has a full-time marketing representative, a lawyer versed in investment company law, a regulatory officer, and accounting personnel. Since first approaching bankers a few weeks ago, Mr. McCoy said that about five banks are already considering offering the asset allocation product, but he would not disclose any names. He hopes to have some of them up and running by the first quarter of 1996. Signet may have a tough time selling this service to other banks, however. Many mutual fund companies, such as Fidelity Investments and T. Rowe Price Associates Inc., already offer their own asset allocation products to banks. "I really think the track record of the company is the primary issue. Have they been doing this for while?" said Nancy E. Graves, senior vice president and director of retail banking for Mark Twain Bank, St. Louis. She added, however, that every bank should be looking at ways of offering asset allocation products, whether on their own or through a partnership with another company or bank. "Not be to be offering this type of product in 1996 would be a mistake for any bank," Ms. Graves said. James Eads, president of Signet Financial Services, agreed. He offers his bank as evidence of how popular asset allocation has become with customers.

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