Several struggling banks desperate for capital are now considering selling their money-management units, according to The Wall Street Journal.

 

National City Corp. is attempting to sell its Allegiant Funds operation with help from Morgan Stanley. The division has about $30 billion, with about half in its more than 30 mutual funds.

 

National City raised $7 billion in capital earlier this year with help from a private-equity firm, but the Cleveland-based firm’s stock remains down 73% this year. Fifth Third Bancorp is also reviewing such options, particularly now that the company’s stock is down 47%.

 

KeyCorp shares are down 51% this year, though it has so far resisted offers to sell its Victory Capital Management unit, which includes its Victory mutual funds.

Likely buyers include private-equity firms and banks interested in getting more access to institutional clients

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