Union Bank has nabbed a seasoned wholesaler from Kemper Corp. to keep the San Francisco banking company's proprietary mutual funds on branch brokers' minds.
Union last week signed Steven Werner to promote its 14 Stepstone Funds.
With the addition of Mr. Werner, Union Bank is joining its larger peers by hiring outside talent to wholesale, or market, proprietary funds to in- house brokers.
The hiring is an "evolutionary step," said R. Gregory Knopf, managing director of proprietary funds.
"We want to have a real salesperson to help us on the next leg of our growth," he said.
Union Bank, majority-owned by the Bank of Tokyo, is out to increase Stepstone Fund assets to $3 billion from $2 billion. "That's why we're doing this," Mr. Knopf said. "Fund sales are not that significant in branches."'
Bank wholesalers are responsible for getting their institution's proprietary funds sold, or at least recommended, by brokers. Bank brokers, or brokerage managers, typically deal with wholesalers from several different fund companies.
Wholesalers are typically paid according to the fund assets sold.
Traditionally, the banking industry hasn't employed wholesalers who have a strong background in that area, according to industry sources.
Instead, many banks - if they have any kind of wholesaling effort at all - either draft an employee or ask for a volunteer, experts said. The haphazard approach can hamstring fund operations, they add.
"If you want to make things happen it makes sense to bring in a professional," said David B. Masters, senior consultant with the Optima Group, Fairfield, Conn. "This is something that real serious banks are pursuing more aggressively."
Mr. Werner, who was traveling last week and could not be reached for comment, will boost the funds' profile by meeting regularly with Union Bank's 30 sales representatives, Mr. Knopf said.
The addition of Mr. Werner is just one cylinder in Union Bank's drive to boost fund assets. The bank, said Mr. Knopf, is very interested in "the next phase - developing programs around our funds."
As a result, in addition to selling funds individually, Union Bank also uses them in its 401(k) offerings, in asset allocation products, and in a sweep account that places corporate balances into Stepstone Funds.
Mr. Knopf remains confident that customers will take to products that contain bank-run funds.
"It's pretty evident from the growth that bank brokerages have already had that customers are interested in doing business," he said.