We now know that Nationwide Funds
is buying 17 HighMark funds from Union Bank
Nationwide Funds president Michael Spangler
explains that the purchase will help his firm address some pressing demands from advisors and their clients.
"We are gaining access to some very attractive asset classes for advisors and their customers. Advisors are telling us that customers are demanding great quality products in areas like international equities, mid and small cap growth funds, U.S. large cap stocks, tax free bonds and equity income to mention few. We also think that we can leverage our distribution abilities across Nationwide to promote these funds," Spangler told MFWire
He stressed that the investment management of all the funds will remain the same. HighMark Capital Management
will become the subadviser for the successors to the nine funds that it currently manages in the form of nine new Nationwide Funds. In addition, eight of the 17 mutual funds are subadvised by three other asset managers: Bailard, Inc.
, Geneva Capital Management Ltd,
and Ziegler Lotsoff Capital Management
, LLC. Nationwide plans to continue those relationships as well.
The firm has shown an appetite for adoptions. For example, last year, it adopted two funds from UBS
and is in the process of adopting a fund from TS&W. Spangler declined comment on whether his company had an appetite for any other acquisitions.
However, his group is investing heavily in growing its distribution operations.
In the distribution side, he said, "we really have made commitments to growing our mutual fund business."
They have aggressively increased wholesaling staff: At the end of 2012, they had approximately 12. They now have 19 wholesalers and a West Coast divisional vice president as well.
They also added a dedicated DC I-O team, including four wholesalers and a divisional vice president as well. Last year, the company added resources to its retail operations, including a national account team devoted to mutual funds.
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