Comerica and Washington Mutual are in the initial stages of selling their asset management units, sources told Associated Press. Comerica's mutual fund unit is the $41.5 billion Munder Capital Management, while Washington Mutual has the $26.4 billion WM Group of Funds. One company that is reportedly considering WM Group is Ameriprise Financial.
If they do unload their asset management arms, Comerica and Wamu will join a growing number of banks that have sold their mutual fund units to focus on their core business. Amsouth Bancorp sold its asset management business to Pioneer Investment Management last year, while Citigroup exchanged its asset management division for Legg Mason's brokerage unit. Increasingly, banks are realizing they don't have the scale to compete with larger fund companies and that this lack of size results in higher, less competitive fees.
"It makes no sense for them to be in that business," said Punk, Ziegel bank analyst Richard X. Bove. There has been "a significant change from what you generally see [when] every bank wants to be everything for everybody [and] suggests a new level of maturity on the parts of management."
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.