global asset management company with money management giant INVESCO Plc.

The new exempted company, INVESCO Global Asset Management Ltd. (IGAM), is targeted primarily at the Bermuda insurance market.

INVESCO, with $70 billion in assets under administration, and Bermuda Asset Management (BAM) have also agreed in principle to form an alliance in which INVESCO will take a stake in BAM.

BAM president, Mr. E.T. (Bob) Richards, who will be the general manager of IGAM, said yesterday that the new company will be responsible for marketing, administration and management of INVESCO's Global Asset Allocation product.

INVESCO executive chairman, Mr. Charles Brady, one of the founding fathers of the group, will lead a delegation of company executives to Bermuda to meet with senior business leaders, including insurers and potential investors, at a luncheon in mid-June.

INVESCO will become a shareholder in BAM, which will continue to market its global equities product as well as a family of INVESCO fixed income products in Bermuda and internationally.

INVESCO is a public, global investment management company whose shares are traded on the London Stock Exchange. It has principle offices in Atlanta, London and Hong Kong, with additional product centres in Boston, Dallas, Louisville, Paris and Tokyo, and, is the final product of a series of transatlantic mergers.

BAM is a local company with $20 million in assets under administration that was founded by Mr. Richards in 1987. It provides asset management services to Bermuda-based institutions, corporations and private clients.

Mr. Richards said: "In terms of assets under management, we are hoping to see that $20 million expand pretty dramatically over the next year.'' A statement from Mr. Brady and Mr. Richards said the alliance is an important initiative for Bermuda, because it combines the depth and breadth of an independent world class investment organisation with the local knowledge and hands-on service that only an established Bermudian company can provide.

Mr. Richards said: "All the important features have been agreed to and letters of intent, or memorandum of understanding, were signed sometime in March.'' HE added: "Our association with INVESCO will allow us to market that particular product more aggressively in Bermuda and overseas. For some time I've been aware that there has been a demand for this product outside of Bermuda, particularly in some parts of the United States. But we haven't had the resources to aggressively pursue that strategy, but now we will.

"One of the problems that BAM had over the years with respect to business from the insurance industry was a problem of credibility. We've been a very small company and a lot of the insurers are multi-billion dollar operations.

So why would they deal with a small company when they could deal with a major league firm? "This arrangement gives those clients the best of both worlds. They get a local service provider, but they also get the depth of a world class organisation. I think it's a win-win situation.

Mr. Richards said the alliance helped bridge the "credibility gap'' with the large insurers.

"People have been trying to figure out how to move forward to fill this opportunity under the present Government regulation and structure,'' he said.

"What INVESCO and BAM have done here is an important way of going about it.'' The announcement comes on the heels of an agreement between Bermuda Commercial Bank and Merrill Lynch Asset Management, which will set up a joint venture asset management company also aimed at Bermuda's insurers. They are to focus on fixed income global asset management services.

Mr. Richards said: "Our situation is a little different because both our companies are exclusively in the investment business. INVESCO do nothing else but manage money. Similarly, we, unlike the bank, do nothing else.

"INVESCO are pretty keen on Bermuda. They wanted to put their Global Asset Allocation product in a geographically neutral site.''