Sales of unit investment trusts are surging, but banks are shying away from offering this rare style of investing to their customers.

This relatively little-known investment vehicle - consisting of a basket of securities with a fixed life span - drew $11.26 billion in fresh money in 1995, a 26% jump from the previous year.

Almost three-fourths of those assets were in stock unit trusts.

Bank brokerage executives, however, would rather place their customers in investments, like mutual funds, that are easier to comprhend.

"I don't totally understand equity unit investment trusts," confessed J. Pinkney Kellet, president of the brokerage subsidiary at Coastal Financial Corp., Myrtle Beach, Calif.

He's not alone among his bank colleagues.

Like mutual funds, unit investment trusts are packages of either stocks or bonds. But unlike funds, their portfolios are much smaller - usually no more than 15 securities - and they have a fixed maturity date.

The customer appeal of stock unit trusts, say fund company sales executives, is that their portfolios don't turn over, so customers know exactly what companies they have invested in.

But brokerage executives and investment advisers complain the portfolios are too niche-oriented, investing in categories such as bank takeover targets.

"I'm not sure why anybody would want an equity UIT - it's a gimmick," said Harold Evensky, a financial planner in Coral Gables, Fla.

Banks say they offer unit trusts that invest in fixed-income instruments but that their sales are flat because the yields aren't comparable with certificates of deposit or individual long-term bonds.

Fund sales executives are frustrated that banks aren't selling more unit trusts, which generally go to investors just entering retirement. Corporate or Treasury bond unit trusts offer monthly income.

"We have been very surprised that UIT sales haven't been better at banks because in a lot of ways they fit with a bank customer's need for certainty," said Jack Tierney, unit trust product manager at Van Kampen American Capital.

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