The latest rise in interest rates may finally calm the financial markets enough to spur lagging mutual funds sales, some bank executives said.

In a round of interviews last week, some executives at bank brokerage affiliates said they were confident that the Federal Reserve had made its last interest rate hike and that stability would return to the stock and bond markets. This would make investments such as mutual funds and variable annuities more attractive to consumers.

Ron Szejner, president the broker-dealer subsidiary of First Michigan Bank Corp., Holland, Mich., said bankers and brokers across the country expressed "a collective sigh of relief" over the Fed's latest move.

"Some people really believe rates have hit their peak, and they're starting to think about longer-term investments," said Mr. Szejner.

Until now, customers at First Michigan's brokerage have been snapping up short-term securities, such as treasuries, and municipal and corporate bonds because of their relatively attractive yields. But Mr. Szejner said he expects consumers now to start turning to longer-term securities to lock in rates.

He also said he expects investors to start putting more money into long- term mutual funds, especially bond funds which would benefit if interest rates remain stable or drop.

The current popularity of fixed-rate securities is no surprise, said Lynne Goldman, a consultant with Cerulli Associates, Boston.

"Right now what you're seeing is (interest) rates at some of the highest rates you have seen in years and if you think that rates are going to drop then you'd want lock in rates now," she said.

Paul Mann, president of First Tennessee National Corp.'s brokerage affiliate, said he was not expecting long-term mutual fund sales to pick up because of the interest rate hike. He added that his customers still aren't ready to commit to buying long-term securities.

"The long-term is still too volatile," Mr. Mann said. "People are going to continue to go short-term and see what they can get."

But he did say he expects to continue to do a brisk business in short- term corporate bonds and other short-term securities.

Dan E. Anderson, chief operating officer of the brokerage affiliate of Synovus Financial Corp., in Columbus, Ga., said he was hopeful that mutual fund sales will pick up.

But he added that "folks right now are still timid about how interest rates will effect their investments."

If interest rates stop rising, he said he expects fund sales to pick up in the second quarter of 1995.

In the meantime, he said, annuity, treasury, and municipal bond sales have taken up much of the slack of dropping mutual fund sales. The brokerage is selling twice as many fixed annuities as it was just a few months ago, Mr. Anderson said. He added that two-year and three-year treasury notes have been especially popular with Synovus customers.

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