Banks' sales of variable annuities struggled in July along with the stock market, falling to $1.2 billion from $1.4 billion in June, according to the Kehrer-Jackson Monthly Annuity Sales Survey, released late last month. Fixed annuities held their ground at $1.5 billion in sales, but wobbly VA sales brought total annuity sales at banks down by 7%.

The Dow Jones industrial average "was down under 10,000 in July, so I guess people shied away from less-guaranteed products," said Janet Cappelletti, associate research director at Kehrer-Limra, in an interview. Backing up her theory, Cappelletti said that while VA sales were down 15% from June, mutual funds were also down, by 17%, to their lowest level this year, $4.2 billion.

Banks' overall production was saved by the quarterly hit of fee income, which kept sales figures steady. "Profit margins on investment programs were 28% in July, up from 21% in June," Cappelletti said. "That's mostly from fees, but profit penetration is substantially up."

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