Small Minneapolis Bank Buys a Securities Brokerage

Article excerpt

Marquette Bancshares, taking a step toward bringing its investment sales program in-house, has acquired a securities brokerage.

Terms of the deal for Offerman & Co. were not disclosed. The banking company and the brokerage - both of which are based in Minneapolis - are privately held.

Marquette, with $1.3 billion of assets, offers retail investments through an arrangement with PrimeVest Financial Services, St. Cloud, Minn., which provides brokerage services to more than 600 banks.

On Aug. 22, Marquette will transfer its retail brokerage business including 25 brokers now licensed through PrimeVest - to Marquette Investment Services. The investment arm, currently part of Marquette's trust subsidiary, will become a unit of Offerman, which has more than 100 independent contract brokers licensed in 48 states.

In opting to run its own brokerage, Marquette is following the lead of dozens of large and midsize banks that have ended their reliance on so called third-party marketers.

PrimeVest and a handful of other marketing firms have helped thousands of banks launch into sales of mutual funds, stocks, bonds, and annuities over the past 15 years. These firms essentially act as brokerages-for-hire, helping banks set up and run investment programs and sharing in the revenues.

But in the past few years, as banks have gained experience with sales programs, many - particularly those with more than $1 billion of assets - have cut their ties to third-party marketers. A Marquette executive said it was time for the bank to follow suit.

"It's a strategic choice at the size we're at," said Margaret Murphy, senior vice president of marketing and sales administration of Marquette Bank. …