While NationsBank Corp.'s brokerage alliance with Dean Witter Financial Services Inc. is widely viewed as a clever strategy, some wonder if the bank might have gotten a better deal.

NationsBank sees the joint venture, under which stocks, bonds, and mutual funds will be sold from its lobbies, as a quick way to tap the growing market for investment services. Its bank-bred brokerage force will get a crash course from Dean Witter in the fast-paced culture of Wall Street sales.

And some rivals evidently find the strategy appealing Banc One Corp., for one, is said to be negotiating with several major securities brokerage firms to arrange a similar pact.

But others question whether North Carolina-based NationsBank will succeed with its plan to franchise the products of Nations Securities to other banks across the country. And they wonder whether NationsBank isn't giving up too much independence to gain quick prominence as a force in the brokerage business.

Among the doubts:

* NationsBank may be forgoing too much valuable fee income by agreeing to a fifty-fifty profit split with Dean Witter.

* The bank's homegrown brokerage force will have trouble blending with Dean Witter's aggressive sales culture.

* The franchise concept is shaky, because it is unlikely that rival banks will market a competitor's products when there are other suppliers available.

On the other hand, many observers believe that Dean Witter has smartly staked out a lead over its traditional competitors. The deal will give it immediate access to the vast customer base of the nation's fourth-largest bank company when the venture is launched early next year.

Seen as Good Deal for Witter

"To us, it looks like it's better deal for Dean Witter than it is for NationsBank," said James M. Truax, a senior vice president at Marketing One, a Portland, Ore., company that sells mutual funds and annuities through banks.

Mr. Truax's firm, of course, would compete with Nations Securities if the bank-owned brokerage moves ahead with its franchising plans.

Even while they carp at the strategy, however, some bank industry securities specialists admire - and even envy - NationsBank and its chairman, Hugh McColl, for pioneering the move. It sends a signal to sleepy banks around the country to look more carefully at the securities business.

"I still haven't figured out what NationsBank gets out of this, other than a more aggressive sales force," said David Cariseo, vice president of Citibank Global Asset Management. But, he added, "NationsBank is the ultimate explorer at the moment."

NationsBank executives, for their part, say criticism of their strategy is laced with self-interest.

"There were some sour grapes, some people who said, |We'd have never done that deal,'" said Charles King, president of NationsBanc Securities Inc., a brokerage subsidiary that will be folded into the new company. "But other people said they wish they'd thought of it."

Products in Demand

Brokerage offerings have become so attractive to consumers that the bank simply had to act, said Mr. King, who will become executive vice president of Nations Securities.

The partnership doesn't intend to be left behind. It will boast 600 brokers by the end of 1993, and upwards of 1,000 by the end of 1995, according to Mr. King.

"If we don't attack now, we're in jeopardy of losing our best customers," Mr. Kind said. "And there is now way we could go from 200 to 1,000 brokers with our current infrastructure. We're much stronger together in this business than we would be alone."

Commission Terms Questioned

Critics, however, said that NationsBank is splitting too much of its commission income with Dean Witter without getting more than promises of volume in return. Under the deal, Dean Witter won't have to generate sales leads but will get half the brokerage profits.

Mr. Truax maintained that NationsBank could have done better by simply hiring sales talent.

Industry analysts agree that NationsBank has taken a gamble in trading income for volume. The split "is high for Dean Witter and low for NationsBank since the customer base is basically under the bank's auspices," said Geoff Bobroff, a Denver-based senior vice president at Lipper Analytical Services Inc., which gathers data on the mutual fund business.

Usually, a Higher Cut

Banks that use outside companies to provide mutual fund services usually keep 70% to 80% of the brokerage commission, Mr. Bobroff said.

The trade-off, he added, is that NationsBank gained access to Dean Witter, which is a "name brand" that could make the Nations Securities line of products more attractive to bank customers.

Mr. King, for his part, said that NationsBank has a partner much stronger than any of the firms that now sell brokerage training programs and products.

"Banks are tired of looking at third-party providers that don't have financial strength or staying power," he said.

Radically Different Cultures

Whether NationsBank and Dean Witter can work together in the branches is another question. Mr. Bobroff of Lipper Analytical predicted difficulties in blending two radically different corporate cultures.

"There is going to be a clash," he said. "I will hazard to guess the Dean Witter brokers will be madder than hell."

But Nations Securities says it is moving forcefully to defuse cultural land mines. Its prime evidence: the naming of Vincent P. Walls, head of Dean Witter's money-making Chicago office and the firm's former training manager, as president of the unit and the appointment of Mr. King as second-in-command.

Meanwhile, other marketers of mutual fund services to banks are telling potential customers to view the venture as a wake up call.

"Any bank within 50 miles of a NationsBank branch that offers this [product line] is going to react," said Eric Alexander, executive vice president of Wall Street Investor Service, New York. "This could be the final push to get them into the mutual fund business."

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