The U.S. unit of ING Group NV, in a quest to join the top five sellers of annuities through banks within 18 months, is hiring wholesalers, developing products, and targeting more potential bank partners.
“Our strategy is to expand our presence in the top 25 banks as well as the regional banks in the United States,” said Harry Stout, the president of ING Annuities.
ING created a group of 10 wholesalers dedicated to the top 25 banks last November, when Mr. Stout joined the company, and has expanded the team to 20 this year. “We plan to continue to build the bank wholesaling force as our annuity business in banks grows, too,” said an ING spokeswoman.
Most of ING’s annuity sales have been made through the biggest financial institutions, Mr. Stout said, but he wants to boost sales through regional banks.
To the existing wholesaler force, ING plans to add a team of six in the next few months who will focus on helping third-party marketers crack the regional bank segment, he said, and he aims to add third-party marketers to the distributor list and deepen the two relationships it currently has with such companies, one of which is Primevest, an ING sister company.
“We haven’t had a real deep focus on working with those organizations,” he said.
The unit of the Dutch insurance and banking giant has $52 billion of annuity assets under management and $9.5 billion of annual new premiums. It plans to flesh out its product offerings through banks, particularly in the fixed annuity arena, he said.
And in the fourth quarter, ING also plans to roll out a “simpler variable annuity product that should appeal to the financial institution community,” he said. The annuity will be “compliance and sales-process friendly,” he said.
Since 2004, ING has formed distribution partnerships with Citibank, Bank of America, Wells Fargo, Wachovia, and JPMorgan Chase, the spokeswoman said.
Bank sales of ING’s fixed, variable, and equity index annuities grew 45% last year, to $907 million, boosting it to 13th-biggest in the channel, from 20th, according to Kenneth Kehrer Associates, a Princeton, N.J., consulting firm that tracks such sales.
The company expects “double-digit” growth to continue, the spokeswoman said.
The Kehrer firm said ING had variable annuity sales through banks of $192 million in the first quarter, up 59% from the year earlier and good enough to rank it sixth in that category. In the quarter, as it has been for a decade, The Hartford was the top variable annuity seller in banks, with $1.25 billion.
ING was 10th in first-quarter fixed bank-annuity sales, at $82 million, or 116% better than the year earlier. AIG/American General remained No. 1, with $2.1 billion of fixed sales in the quarter.
Mr. Stout declined to say whether he thinks the recent turmoil at AIG presents an opportunity for competitors to grab market share. ING/Aetna’s total annuity sales in the quarter placed it 11th in the Kehrer rankings.
Regulators have focused recently on the appropriateness of variable annuity sales to certain investment customers, senior citizens in particular, but Mr. Stout said this has not complicated ING’s effort to expand.
“The environment is what the environment is,” he said. “It’s probably not going to change anytime soon, and I don’t know if it should change.”
