Sales of fixed annuities have taken a hard fall, but one bank seller of these retirement investments has little to fret about.

Birmingham, Ala.-based Amsouth Bancorp sold $200 million in annuities last year, 35% more than a year earlier, according to the Bank Insurance Research Group, Mamaroneck, N.Y. That helped push the bank from the 20th- to the 17th-largest seller of annuities among banks.

According to the bank and one of its leading annuity suppliers, most of the rise was due to the growth in the fixed annuity business.

"Fixed annuities have been a big hit for us," said Michael Baker, Amsouth's senior executive vice president in charge of its capital management group. "It's been a really pleasant surprise."

And $19.4 billion-asset Amsouth is bucking other insurance trends too. It is expanding the number of annuity underwriters available to customers and eschewing what Mr. Baker calls the distraction of new insurance product lines for the bank, such as property and casualty.

Meanwhile, Mr. Baker is continuing to expand a platform sales program started last fall to supplement fixed annuity sales of its 75 brokers with series 7 licenses.

Amsouth's growing fixed annuity sales business stands in sharp contrast to the industry norm. In the first quarter, banks sold $1.8 billion in fixed annuities, down from $2.6 billion in the same period a year earlier, according to Kenneth Kehrer, a Princeton, N.J.-based consultant.

But Amsouth was not fazed by the prevailing national mood. The bank decided that customers would continue to like fixed annuities as a hedge against the stock market.

"There still exist a number of customers who have trepidation about the market," said Joe Neuberger, national sales manager for the financial institutions group of Lincoln National Life Insurance Co. of Fort Wayne, Ind., which works with the bank. These customers, many of whom are looking to diversify, are comfortable with fixed annuities, he said.

In October the bank decided to use Lincoln National to train and license 150 platform workers to sell fixed annuities.

With its new sales force, sales took off, Mr. Baker said-though he declined to give sales figures by product line. "We did so well we decided to dramatically expand it," he said.

Now the bank has close to 500 platform workers licensed and it wants to add even more, he said.

Lincoln National said Amsouth's program stands out from others because top-level executives support the program. They told the rank and file that selling this product would be good for their careers, Mr. Neuberger said.

Though the bank offers eight fixed annuities products, only Lincoln National's Investor's Choice is sold by platform personnel. The bank also has a successful variable annuities program and offers products underwritten by five insurers.

"It really doesn't cost us any more to offer a greater number of products," Mr. Baker said. "You just have to have it on the shelf, attractively packaged and competitively priced."

Despite its success in the annuities marketing business, Amsouth has little interest in breaking into insurance policy sales.

"We don't see our customers clamoring for it, and we don't see anything that works financially," Mr. Baker said.

Even though many banks are making moves in this area, Mr. Baker said, "starting up an insurance business takes away from a lot of your core activities." In particular, trust and investment products programs can suffer, he said.

"We don't think we missed anything," he added.

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