U.S. Trust Corp. of New York has revamped its asset-management and private banking groups, in a move to capture more of the institutional and mutual fund management business.
The $3.6 billion-asset bank, which has traditionally served wealthy individuals and families, has created an institutional and mutual fund asset management division, putting an executive vice president, Paul K. Napoli, in charge of the unit.
A quarter of the $31.2 billion of assets U.S. Trust manages are institutional assets.
Looking for Growth
But by creating a new division, the bank hopes to grow the business.
"This reorganization reflects the increasingly important role we expect our institutional and mutual funds investment management businesses to play in the future growth of U.S. Trust's asset management business," said U.S. Trust's president, Jeffrey S. Maurer, in a prepared statement.
The new division will manage and market employee benefit plans, endowments, foundations, proprietary mutual funds for institutional investors, and common and collective trust funds.
In the next few months, U.S. Trust is also introducing the Excelsior Funds, a family of institutional funds.
Launching an institutional fund family will help the bank serve more accounts, such as endowments, Mr. Napoli said.
The unit is also considering selling investment management services for other bank's proprietary funds, a market U.S. Trust has not targeted before.
"The goal is to be more creative about how we distribute our services on the institutional and mutual fund side and to build assets under management" Mr. Napoli said.
In his new role, Mr. Napoli has increased the range of businesses for which he is responsible.
Previously, as head of U.S. Trust's asset management division, he was in charge of only trust and estate administration and tax services for institutions.
In one part of its operation, the marketing of mutual funds to institutions, U.S. Trust could face growing competition, as other companies beef up their capabilities.
Courting of institutional investors is growing as "the retail side of the business is leveling off," said John J. DeMarco, senior vice president of PSI, a Tampa-based firm that specializes in private banking research and consulting.
U.S. Trust's new strategy appears to be part of a larger trend.
Other banking companies, such as PNC Bank Corp. and Bankers Trust New York Corp., are also focusing on institutional money management. And the business is not solely dominated by banks.
Alliance Capital Management, a mutual fund company based in New York, also has a large money management business for institutional clients.
In a separate move, U.S. Trust has put another executive vice president, John C. Hover, in charge of both the personal asset management and private banking businesses, which have been consolidated.