"Wells is quite focused on trying to revive that banking- supermarket approach," Aite's Schmitt said. "This is an expansion of that model."
As recently as the 1990s, brokers, banks and insurance companies dominated the top 20 spots among U.S. mutual fund families, when money funds are included in total assets.
Net Outflows
It hasn't always worked out. Citigroup Inc. is partially dismantling itself after ex-CEO Sanford I. Weill tried to sell savings accounts, insurance and investments in the 1990s. It sold its money-management business to Legg Mason Inc. in 2005.
Banks also were forced to reimburse clients or watch assets dwindle when the performance of funds suffered. Evergreen, when it was owned by Wachovia, saw net outflows of $11 billion in 2008 after subprime mortgage losses forced it to close a bond fund and bail out money-market fund investors.
"It's certainly possible to have a genuinely valuable asset-management business inside a big bank," said Loren Fox, a senior analyst at New York-based Strategic Insight, a mutual fund research and consulting firm. "The issue is whether mutual funds are something that will be just another product or whether asset management is a core business that you are committed to building to stand on its own two feet. Wells Fargo is making a big commitment."