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Liberty Will Combine Wholesaling Functions

Liberty Financial Cos. of Boston is creating a hybrid sales force as a means of coping with the growth it has experienced in both its mutual fund and annuity businesses.

Liberty, which is parent to both Liberty Funds Distributor and Keyport Life Insurance Co., both of Boston, is creating a sales team that combines the forces of the two units under the Liberty Funds Distributor name.

The plan will be gradually phased in beginning next fall and will not be entirely in effect until early next year. However, when it is complete, Liberty will have 60 wholesalers, not including internal wholesalers and marketing support, who will sell both mutual funds and annuities. An additional six wholesalers - not new hires - will just sell annuities, focusing on Liberty's most important clients, such as Fleet Bank of Boston, which Liberty has decided needs its own dedicated sales staff.

The mutual fund group now has approximately 35 wholesalers, while Keyport has 25 to 30 wholesalers, said Porter Morgan, senior vice president for Liberty Financial Cos.

The move will decrease the size of each wholesaler's geographic territory, enabling each wholesaler to double the amount of visits he can make to clients, company officials said. The reorganization will also eliminate many existing overlapping territories, said Morgan.

Liberty Financial Cos. manages over $61 billion in assets. Mutual funds account for roughly $20 billion of that figure, and $17 billion are managed through annuity products. The rest is managed through private and institutional accounts.

Liberty had $3.1 billion in net sales from all of its product lines in the first quarter of 1999, a 48 percent increase over the first quarter of 1998. Faced with this rapid growth, the company could have hired more wholesalers. However, it is more cost effective to combine wholesaling efforts rather than make new hires, said Morgan.

"We've seen good growth, and a question is, how do you sustain it?" Morgan said. "This (move) is really about getting bigger."

Liberty does not anticipate any job cuts as a result of the sales force merger, Morgan said. The combination will not be easy, and should be a process that continues into next year, Morgan said. Liberty Financial has created several task force groups to work with its bank and brokerage clients to decide how to divide up the new sales territories. The new sales team will work under Jim Tambone and Lou Tasiopoulos, co-heads of Liberty Funds Distributor.