Columbia Management, a group of mutual funds formerly owned by Bank of America Corp., is changing its brand name to Columbia Threadneedle Investments as its new parent looks to bolster the business in an ever more competitive climate.
Ameriprise Financial Inc., based in Minneapolis, is expected to announce the brand change Monday, which links Boston-based Columbia with its UK investment group, Threadneedle Investments. Together, the firms will have a combined $505 billion in assets and a stronger ability to share research and resources globally, said Ted Truscott, Ameriprise’s chief of global asset management and a longtime Boston financial executive.
“This is a big step for us We’ve been working at this for a couple years now,’’ Truscott said, describing a more global approach. “We are not doing this for show.”
Yet Truscott acknowledges that competing for assets is fierce in a business that has come to be dominated by a few giants. In the retirement arena, for instance, Vanguard Group, of Valley Forge, Pa., and Fidelity Investments, of Boston, are far ahead of the pack.
Columbia Management is a group of mutual funds that was packaged over time by banks that acquired a string of investment firms. Brands within the group have included Acorn, Wanger, and Seligman, and those names will remain on well-known funds, the company said.
Ameriprise bought Columbia in 2010 from Bank of America for about $1 billion in cash. Investment management accounts for more than one-quarter of Ameriprise’s revenue, according to Zacks Investment Research. But the fund group has been losing assets.
“The segment has been facing considerable outflows,’’ according to a recent Zacks report. “In the first nine months of 2014 it witnessed net ouflows of $3.6 billion.” Outflows are expected to continue in the coming quarters, Zacks said, though at a slower pace.
Columbia said that it brought in $1.1 billion from large institutional customers in the third quarter. The firm’s funds are sold by brokers and advisers — a key difference from Vanguard or Fidelity, which sell most of their funds directly to investors.
Truscott acknowledged that as the 30th-largest global investment manager, Columbia faces intense competition.
“It’s quite frankly about grabbing market share,’’ Truscott said. “You’re really fighting a couple of battles: trying to grow internationally, trying to grow in [investment] alternatives.”
The combined companies have more than 2,000 employees, 450 of them in Boston, including part of the executive team. Threadneedle, though not a household name in the United States, is the fifth-largest retail money manager in the United Kingdom, with $150 billion in assets.