Bank holding companies earned a record $3.4 billion from the sale of annuities last year, up 9% from a year earlier, according to a report released Tuesday by Michael White Associates of Radnor, Pa.
The trend was consistent throughout 2013, as banks reported record annuity income in each quarter, the report said. Commissions totaled $932 million in the fourth quarter, up 6.5% from the previous quarter and 17.3% from the fourth quarter of 2012.
The bank insurance consulting firm measured the annual annuity fee income generated by banks based on data from all 6,812 commercial banks, savings banks and savings associations or thrifts, and over 1,060 large top-tier bank and thrift holding companies. It said that 39.8% of bank holding companies participated in annuity sales activities in 2013.
Findings show "signs of a definite improvement in annuity earnings momentum," said Michael White, president of the firm and author of the report. More than half, 51.1%, of the holding companies selling annuities, earned at least $250,000 in commissions. Less than 42% earned that amount in 2012, the report said.
Among institutions with more than $10 billion of assets, Wells Fargo (WF) Morgan Stanley (MS), Raymond James Financial (RJF), JPMorgan Chase (JPM), and Bank of America (BAC) were the top sellers of annuity products last year.
Stifel Financial (SF), SWS Group, First Citizens Bancorporation and Old National Bancorp (ONB) were some of the top sellers among companies with assets between $1 billion and $10 billion. First Command Financial Services, Hopfed Bancorp (HFBC), ION Financial MHC, Northeast Bancorp (NBN) and Goodenow Bancorporation topped the list of holding companies with between $500 million to $1 billion of assets.