1st Source Corporation Investment Advisors, a subsidiary of 1st Source Bank, has entered into an agreement to form a long-term strategic partnership with Wasatch Advisors.
Under the partnership, 1st Source Monogram Mutual Funds – the Income Equity Fund, the Long/Short Fund and the Income Fund will be re-branded as the Wasatch-1st Source Income Equity Fund, the Wasatch-1st Source Long/Short Fund, and the Wasatch-1st Source Income Fund.
The Wasatch-1st Source Funds will continue to be managed by current portfolio managers, Ralph Shive; Michael Shinnick; and Paul Gifford. The partnership with Wasatch will provide the managers with more research resources and more time to focus on managing their respective funds, the companies said.
Wasatch will acquire the assets of 1st Source Corporation Investment Advisors, related to the management of the 1st Source Monogram Mutual Funds and add the three new funds to its Wasatch Funds no-load family. As part of the strategic partnership, $11.7 million will be paid to 1st Source at the closing.
1st Source will also receive performance payments over the next 10 years based on the net growth and the investment performance returns of the funds. The agreement is subject to the approval of regulators, fund shareholders and others, and is expected to close by the end of the year subject to customary closing conditions.
Under terms of the agreement, Mr Shive and Mr Shinnick will join Wasatch Advisors as employees and eventually move to a new Wasatch office in the South Bend area. They will join with former 1st Source Monogram Special Equity Fund manager, Brian Bythrow, who has been with Wasatch since 2003 managing the Wasatch MicroCap Value Fund. Mr Gifford will remain employed and housed with 1st Source and becomes the chief investment officer of 1st Source Corporation Investment Advisors.
Through this partnership, 1st Source Bank expects to expand and strengthen its investment services for clients.
Samuel Stewart, Jr, chairman of Wasatch, said: Ralph Shive and Mike Shinnick are a great fit with our collaborative multiple eyes process, and bring proven investment expertise that will strengthen the Wasatch team. We think this is a great partnership for our shareholders through what it brings to our research team, and also because it broadens our range of quality products into three asset classes of particular interest to our clients.