Heavy consolidation among U.S. banks in 1997 may have distracted some from providing top-notch service to their mutual fund investors.
A year ago Dalbar Inc. awarded 12 Quality Tested Service Seals awards in the area, and two of them went to banks. But this time around Dalbar found only seven companies worthy of the honor, and no banks were among them.
Van Kampen American Capital took the top prize for the eighth consecutive year.
Dalbar, based in Boston, gives out the awards in recognition of exceptional customer service by such measures as telephone manner and clarity of written communications, said Kathleen Whalen, program director for the award program.
The results are based on a poll of retail investors using 80 firms, including 12 banks.
In 1996, Fleet Financial Corp.'s Galaxy Funds and First Union Corp.'s Evergreen Funds group made the first appearance by banks in the Quality Tested Service Seal lineup in six years.
Last year banks were "very solid players," Ms. Whalen said, but it is hard to maintain the "exceptional service" necessary to make the grade over an entire year.
Rapid consolidation in the banking industry last year may have spurred banks to concentrate their efforts elsewhere, she said.
First Union, for instance, is buying CoreStates Financial Corp. as well as regional broker-dealer Wheat First Butcher Singer. And Fleet is about to close a deal for discount broker Quick & Reilly and is acquiring credit card company Advanta Corp.
Another factor is the intensity of competition across the board in service delivery in the mutual fund business, added Ms. Whalen.
Banks have not slipped entirely from the radar screen. Charlotte-based NationsBank's Nations Funds and Chase Manhattan's Vista Funds made Dalbar's Key Honors list, a lesser accolade that recognizes companies offering "good service" consistently.
