Magazine article American Banker

Hancock Seen Likely to Shed Transamerica's Focus on Bank Channel

Magazine article American Banker

Hancock Seen Likely to Shed Transamerica's Focus on Bank Channel

Article excerpt

John Hancock Mutual Life Insurance Co.'s planned acquisition of Transamerica Corp.'s mutual fund business could take a promising player out of the business of marketing funds through banks.

Though Transamerica channels one-sixth of its fund sales through banks, John Hancock does only 5% of its business this way. And the chief of John Hancock's mutual fund unit doesn't see much value in changing that.

'94 Acquisitions Of Mutual Fund Firms

                Assets
                  In          Acquired
                bIIIIons        by
Kemper           $45         Conseco
Corp.
American         $17         Van
Capital                      Kampen
Managoment                   Merritt
and Research
Colonial         $14         Liberty
Group                        Financial
Transamerica     $3          John
Funds                        Hancock

Sources: Strategic Insight, company reports

"The bank channel has not been attractive," said Edward J. Boudreau Jr., chairman and chief executive of the John Hancock Mutual Funds.

"I don't see it as a robust avenue for fund distribution, as some have suggested," he added.

Mr. Boudreau was more sanguine about what the acquisition will mean for John Hancock.

The deal will give the Bostonbased company "a stronger competitive position in the industry," he said.

John Hancock has agreed to pay $100 million for San Francisco-based Transamerica's Fund Management unit.

The $3 billion of assets in the 17 funds managed by this unit would bring John Hancock's total fund assets up to $14.5 billion.

Combined, the funds would have more than 1 million shareholders. …

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