A joint venture with Putnam Investments helped push Allstate Life Insurance Co.'s sales of variable annuities through banks 49% higher in the second quarter.
The jump to $348 million, from $233 million in the first quarter, can be largely attributed to the Putnam Allstate Advisor joint venture, said Kenneth Kehrer, president of Kenneth Kehrer Associates. His Princeton, N.J., consulting firm released its second-quarter annuity sales rankings Thursday. 
"Putnam is a best-selling mutual fund in banks, and the name Putnam goes a long way in the bank channel," Mr. Kehrer said. "They started selling that product a little over a year ago, and it's worked out well for them so far."
Allstate Life, of Northbrook, Ill., announced in May that the joint venture had sales of $1.53 billion in its first year, 34% of it through banks. Its variable annuities are issued by Allstate Life Insurance and underwritten by Allstate Distributors LLC of Northbrook. Bank distributors include California Federal Bank, PNC Bank, Summit Bank, HSBC Bank, and Wachovia Bank.
Allstate also has strong sales from a product it sells through SunTrust Bank, Mr. Kehrer noted.
John Hunter, managing director of Allstate Distributors, predicts that banks "will sell a larger share of variable annuities. People are getting older, and variable annuities are a retirement tool."
Putnam Investments, of Boston, manages $380 billion for more than 12 million individual shareholder accounts and 1,000 institutional clients.
Other insurers boosting sales of variable annuities through bank distribution include American General Financial Corp. of Houston, which sold $228 million in variables in the second quarter. That 107% jump came even though fixed annuities - and not variable annuities - remain American General's bread and butter. American General sold $855 million of fixed annuities in the quarter.
Allstate's fixed annuity sales through banks dropped to $364 million, from $426 million.
"There was a month or so where their interest rates weren't competitive," Mr. Kehrer said. "For instance, Bank One sells three fixed annuities: one from Nationwide, one from Aegon, and one from Glenbrook Life. For a little while, Allstate's interest rates were not as good, so they lost sales." Glenbrook is an Allstate subsidiary.
