Amsouth Bancorp. says that its brokerage unit, once plagued by regulatory woes, is back on track.

The unit's revenues are expected to climb 35% this year, to $34 million, said Michael C. Baker, senior executive vice president of the Birmingham, Ala., banking company's capital management group.

New products, including fixed annuities, have been successfully introduced, he said, and the unit's sales force has been doubled to 75 brokers.

"We're off the bench and playing very aggressively against some very strong competition," Mr. Baker said.

Amsouth Investment Services Inc. was "benched" by a series of compliance problems that began in 1995, when clients in Florida and Alabama sought to file class actions against it, alleging that they were misled about investment risks.

Also that year, securities regulators began investigating possible record keeping violations at the brokerage.

Though the banking company remains in arbitration with one client, Mr. Baker said Amsouth has put its legal problems behind it.

Plaintiffs in Florida and Alabama failed to form a class in litigation against the brokerage. And Amsouth settled the record keeping charges by paying $260,000 in fines to the National Association of Securities Dealers and the securities departments of Alabama and Florida in 1996 and 1997.

Mr. Baker said Amsouth revamped its compliance systems as it hired new brokers. Those two factors helped the brokerage rev up sales, he said.

"When you have good sales practices and start getting good marks on compliance, it ends up translating into a really good sales environment," he said.

Indeed, Mr. Baker said, despite recent stock market turmoil, Amsouth Investment Services, which has more than $3 billion in customer accounts, should hit its sales targets this year.

"There's been a little bit of a slowdown in September with the uncertainty in the equity markets," he said, but "our revenue levels are very, very good."

Still, today's rocky markets could prompt more litigation against bank- owned brokerages, said Jonathan Alpert of the Alpert, Barker & Rodems law firm in Tampa. Mr. Alpert represented Florida plaintiffs against Amsouth.

"Many of the disclosure, suitability, and other problems were papered over by a booming economy and a booming stock market," Mr. Alpert said. "The concept that people can go into a national bank and lose money is going to come back and be most troubling for them."

Though most of Amsouth's new brokers came from other bank-housed brokerages and wire houses, three of its top producers are former Amsouth branch managers, Mr. Baker said.

Mutual funds and ann-uities-both proprietary and those managed by other companies-are the brokerage's top sellers, Mr. Baker said. Amsouth also offers individual securities.

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