Although banks have had a difficult time growing as a mutual fund distribution channel, accounting for only 9% of mutual fund sales in 2000, that has not stopped them from creating mutual funds. While sales may be low, there are distinct advantages for bank-owned funds, according to Cerulli Associates, a mutual fund research and consulting firm based in Boston.
First Financial Bancorp (FFB) of Hamilton, Ohio, is the latest bank to try to build on the loyal, conservative customer base typically found at banks with a new family of mutual funds. Last month, the holding company announced that it had created The Legacy Funds Group, an investment management company consisting of three mutual funds. First Financial Capital Advisors, an FFB affiliate also in Hamilton, Ohio that manages common bank trusts, will manage the funds.