Magazine article American Banker

Chase Sets an Ambitious Goal: To Become Mutual Fund Titan

Magazine article American Banker

Chase Sets an Ambitious Goal: To Become Mutual Fund Titan

Article excerpt

Chase Manhattan Corp. didn't get to be one of the nation's biggest banking companies by being a shrinking violet.

But the money-center giant may have outdone itself when it announced this week that it aims to rank among the 10 largest mutual fund companies in 10 years.

In the dog-eat-dog mutual fund business, growth is seen as an absolute necessity. But onlookers said they didn't expect Chase -- whose $6.5 billion in mutual fund assets place it 58th in the fund industry in one tally -- to join the industry's behemoths anytimes soon.

"It's a nice piece of bravado, and we're glad to see Americans beat the drums and thump their spears, but it's not as easy as that," said William B. Berger, chairman of Berger Associates, a $2.7 billion-asset fund company in Denver.

According to the Investment Company Institute, Chase's Vista funds are roughly one-eighth the size of the current occupant of 10th place in the fund industry -- Dean Witter Discover & Co., which manages $56.9 billion in assets. The biggest mutual fund manager, Fidelity Investments, has $272.7 billion of assets.

While a big acquisition could move Chase up the rankings quickly, a senior executive virtually ruled such buys out for the foreseeable future, saying they're too expensive.

It isn't surprising that a big banking company would want to boost its mutual fund business. Managing fund assets is seen a potentially lucrative source of fees.

Indeed, Mellon Bank Corp. last year became the first -- and, to date, the only -- banking company to rank among the country's 10 largest mutual fund managers, when it bought Dreyfus Corp. …

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