Security First Group, a seller of annuities and investment services through banks, is proudly touting its report card for the first half.
The Los Angeles-based company, which is both a marketer and a manufacturer of annuities, said sales of its wares through banks were up 55% from the first six months of 1996.
In the same time period, 25 smaller banks signed up for its full-service investment program, in which Security First representatives sell annuities, mutual funds, and securities, counsel clients, and handle related functions like marketing and compliance at the bank. The company now has 90 clients in all.
And earlier this month, Security First announced that it had hired Brian J. Finneran-former president of James Mitchell & Co., a San Diego-based rival-to run its bank-channel business. Mr. Finneran is no stranger to Security First: He worked there from 1975 to 1984, last serving as a group vice president of the company's wholesale division. Mr. Finneran succeeded Michael McCoy, who left to join American Enterprise Life in April.
"These are exciting times for our bank division, which we believe is positioned well within the rapidly changing bank investment marketplace," Robert G. Mepham, Security First's chief executive, said in announcing Mr. Finneran's appointment.
Security First sold $149 million of annuities last year, placing it well behind rivals such as Nationwide Life Insurance Co. of Columbus, Ohio, and Hartford Financial Services Group in Connecticut.
In addition to adding new banks, the company says it has increased sales through existing clients such as Signet Bank in Richmond, Va. Other established bank clients include Chemical Bank and Trust in Midland, Mich.; Virginia First Savings Bank in Richmond; and First Western Bank Corp. of Newcastle, Pa.
Fred J. Liskowski, president of First Western Trust Services Co., the subsidiary that offers investment products, said the bank signed on with Security First about five months ago.
"I thought they offered a real competitive product line and service," said Mr. Liskowski, whose unit manages $500 million of assets. "They have just five or six products that fit the bank environment well, rather than 25 annuities that confuse the reps and everyone else."
Security First has been a partner, not just a vendor, to Signet, said Carroll Swenson, vice president and director of investment services for the bank.
For example, Security First designed a custom variable annuity sold only through the bank, and it has helped train the bank's sales force.
As a result, sales of Security First's products quadrupled since 1994, and overall investment product sales rose 30%, said Mr. Swenson, whose bank manages $12 billion in assets.
David Kaytes, managing vice president at First Manhattan Consulting Group, said a rising tide of interest in variable annuities is helping to lift Security First's boat-along with its competitors.'
"This product has suddenly caught the attention of the industry and the public in the way mutual funds caught on a decade ago," said Mr. Kaytes. "The upside potential is much higher than we're seeing already."
Bank annuity sales in the first three quarters of 1996 were $12.9 billion, 21% more than in year-earlier period.
