Chicago's Harris Bankcorp recently announced the selection of a new partner to help it sell annuities.
Last month the $13.5 billion-asset bank said that in September it had started using a unit of the Laughlin Group of Cos. to help it sell annuities.
This deal follows an annuities marketing partnership with a unit of GE Capital Corp. that Harris ended in 1993.
Sources close to Harris said the bank expects the Laughlin partnership to fare better than the one with GE's GNA Corp. did.
In the new program, seven brokers of the bank's brokerage affiliate work as dual employees of Beaverton, Ore.-based Laughlin.
From the customer's perspective, the major distinction between the employers is in the brokers' business cards.
For example, when selling mutual funds, the brokers use business cards that list the bank's name. When selling annuities, they use business cards that say they work for the Investor Financial Services unit of Laughlin. In both cases, the brokers make sales from bank offices.
The Laughlin unit is responsible for training the brokers to sell annuities, and for handling oversight and regulatory compliance.
"Harris is the type of account we're looking for," said Michael E. Denton, a managing director who helped bring the bank on board for Laughlin. He cited Harris' "good name" and customer base as two of the reasons his firm wanted the account.
Previously, annuities sales were less integrated at Harris. Specifically, GNA Corp., the Seattle-based unit of GE Capital, sold annuities to Harris customers from its own offices, using its own employees.
Sources close to Harris, who asked not to be named, said that during the two-year relationship, GNA had a difficult time working with Harris' in- house brokerage. GNA's representatives were said to be viewed by Harris employees and conservative customers as "outsiders" and sales suffered.
Tony F. Haeussler, a vice president at Harris Investors Direct Inc., the bank's brokerage, declined to comment on that relationship. But he did say that the bank had to "reevaluate" its annuity delivery process.
Illinois regulations prohibit banks from selling insurance.
"We have to be careful that our customers understand we're representing Laughlin and that (annuities) are not provided by the bank," Mr. Haeussler said.
Annuities are sold at six Harris locations.
