SunAmerica is just a small player in the bank distribution market, but its executives say it is making up ground fast.

The company sold about $125 million of variable annuities through banks last year, a small total considering that the top five sellers through banks had combined sales of up to $5 billion, or 90% of the market, in 1997.

But this year SunAmerica should have sales through banks of $300 million, 95% of it in variables, said Jana Waring Greer, president of SunAmerica Retirement Markets.

And she projected 1999 sales of $500 million. Part of the reason is that in the last year the insurer has tripled the number of banks selling its products, to 60, she said.

That growth springs from a corporate decision two years ago to focus on bank sales and build a wholesaling force to increase the business, Ms. Greer said. Two years ago banks accounted for less than 0.5% of SunAmerica annuity sales; this share is now 7% and should rise to 12% to 15% within two years, she said.

And the American International Group merger should supply more access to banks because AIG sells fixed annuities through a number of financial institutions, she said.

"This is a wonderful combination for us," she said.

SunAmerica's bank sales effort has been hampered by turnover in its executive ranks over the years, observers said. And it has had to live down a false start: In 1990, the company pulled out of the bank distribution business, leaving in the lurch two big banking companies that had just agreed to sell its products-Comerica and Natwest.

"That naturally had a chilling effect" in the bank marketplace, said Kenneth Kehrer, a consultant in Princeton, N.J.

SunAmerica's bank partners now include Chase Manhattan Corp., Citicorp, Summit Bancorp, and SouthTrust Corp.

Bob Church, a principal in Spectrum Consulting Group, Los Gatos, Calif., said grabbing more shelf space will be difficult because the market is dominated by a few players.

Hartford, the market leader, sold as much as $3 billion of variables through banks last year, and the No. 2 company, Nationwide, had almost $1 billion of sales, Mr. Church said.

"It comes down to shelf space, the size of the market, and the fact that you're going to have to take shelf space from Hartford," he said.

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