Choosing an investment products marketer can sometimes turn into a game Of chance, as a community bank in Paradise, Calif., has learned.
After eight stormy months with one marketing partner, Butte Community Bank dropped the company, citing poor service.
"We didn't receive the support and training we were looking for," said Keith Robbins, president of the $52 million-asset bank.
Butte Bank's partner was Protective Financial, Santa Barbara, Calif. The company is a unit of Essex Corp., New York, a leading investment marketing partner of banks.
Like many community banks that enter investment sales, Butte Bank was eager to find a way to retain customers who wanted more choices. But the arrangement turned sour quickly.
Mr. Robbins said the bank faced numerous problems with the company, including the slow-execution of financial transactions and inconsistent telephone support for their sales representatives and customers.
"It was basically a 'catch as catch can'," Mr. Robbins said.
Michael Corrigan, president of Protective Financial, acknowledged the bank's sales program had not been successful.
Though the company made several concessions to Butte, "we just weren't a good fit for each other," he said.
Employee in Charge
He traces the problems to Butte Bank's insistence upon placing a licensed-bank employee in charge of the investment product sales program. The marketing company did so even though it usually places its own sales representatives in bank lobbies."
"It's a mistake we won't won't be making again," Mr. Corrigan said.
After the two companies went their own ways, Butte Bank decided to sign on with another investment products marketer, Affiliated Financial Services of Denver, whose services had been endorsed by the Western Independent Bankers Association.
Return to Normal
Cathy Robbins, who is married to the bank's president, continued as head broker under the new arrangement with Affiliated Financial. In a telephone interview, she said the sales program is back on track.
Mutual fund sales have been especially brisk, and account for 95% of the bank's investment sales volume. Among the top sellers are funds managed by Putnam Financial Services, Capital Research & Management Co., and Massachusetts Financial Services.
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