Banks lag in selling mutual fund wrap accounts
Post on: 18 Июль, 2015 No Comment
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- Bill introduced to regulate fund sales. Talley, Karen // American Banker;10/26/93, Vol. 158 Issue 205, p12
Reports on the proposal by House Banking Committee Chairman Henry B. Gonzalez and Rep. Charles Schumer that will place restrictions on the way banks sell mutual funds and annuities in branches. Chances of passage; Reaction from bank groups; Banks’ use of rank-and-file employees to market.
Reports on the decline in sales of mutual funds sold by banks in July 1994. Reflection of industrywide trends; Projected strong sales of mutual funds in August 1994; Decline in fresh inflows into mutual funds; Heavy outflows of bond funds due to rising interest rates.
Reports on the Federal Deposit Insurance Corp.’s decision to send mutual fund testers into banks. Fear that normal examination procedures might not catch major problems in sales practices; Aim of verifying whether oral sales pitches made by bankers to customers convey the same warnings in.
Reports on the controversy regarding incentives given by mutual fund companies to bank-based sales representatives. Bank implemented policies on dealing with fund company representatives and their offerings; Banks and fund companies as sales partners; Bank executives having no direct control.
Reports on commercial banks and thrifts’ decline in market share of mutual funds in 1994. Prediction of an increase in share by the year 2000; Gains to come at the expense of securities firms which sell load funds; Edge of direct-marketed mutual funds with advertising budgets.
Evaluates the capability of small banks in the United States to make profit from the sale of mutual funds. Assessment of the mutual fund business by financial analysts; Financial returns of banks’ mutual fund programs; Marketability of annuities.
Discusses banks’ failure to make effective use of the Internet to promote their branded mutual fund offerings in the United States. Survey of the Web sites of 18 bank or insurance-owned mutual funds; Absence of return text links from mutual fund sites to home pages; Challenge of cross-branding;.
Reports on the obstacles to the banking industry’s acceptance of automated teller machines (ATM) as a delivery channel for mutual funds. Disclosure and differentiation between deposit and investment products; Tax consequences for customers who make redemptions at an ATM; Technical problems.
Reports that many small banks are dismantling mutual fund and annuity sales programs they built just a year or two ago. Overestimation of the potential of the sales programs; Losses; Overcrowded market.
