WASHINGTON -- Massachusetts Financial Services has signed up its first client for a new line of mutual funds that was designed to help banks and other financial inter- mediaries build variable annuities.

Plan America, the financial planning subsidiary of the Credit Union National Association, will begin offering an annuity using the MFS World Government Fund, one of 12 portfolios in the MFS Variable Insurance Trust, said F. Bennett Coleman, vice president of the MFS Asset Management Group.

Mr. Coleman added that four banks, including two major regional players, are close to signing contracts.

The Boston-based mutual fund company introduced the variable insurance trust last month in a bid to strike partnerships with banks that want to create annuities but don't want to manage the assets themselves.

Mr. Coleman said he hopes the Variable Insurance Trust will attract $250 milliion in asssets by the end of next year. He expects to have 20 banks, brokerages, and financial planning firms as clients by then. MFS already manages more than $3.5 billion in annuity assets, he added.

As one of the nation's oldest mutual fund companies, MFS believes its "reputation in the business and name recognition" will be a big selling point with bank customers, Mr. Coleman said.

"Banks have done a great job with mutual funds and fixed annuities. It's a natural extension for them to go into variable annuities," Mr. Coleman said in an interview at the Investment Company Institute's annual convention here.

Annuities are insurance contracts that invest in a pool of securities to produce a stream of income at a future date, typically for retirement. They come in two varieties: fixed annuities, which invest in bonds to produce a promised yield, and variable annuities, which invest in mutual funds to produce an undetermined, but potentially high return.

Annuities have gained popularity in recent years, largely because the savings accumulated in the-investments are not taxed until withdrawal.

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