Thrifts sell twice as many annuities as commercial banks, in relation their asset bases, according to a study.

Compared with commercial banks, the top annuity-selling thrifts in the nation had markedly better sales-to-assets ratios in the fourth quarter of 1994, according to Mamaroneck, N.Y.-based Bank Insurance Market Research Group.

This ratio shows the degree to which investment product sales penetrated the underlying asset base.

According to the study, TCF Bank Minnesota - formerly called Twin Cities Financial - had the highest annuity-sales-to-assets ratio, at 0.77%.

The study revealed that the average thrift had a sales-to-assets ratio of 0.22%, about twice that of commercial banks.

Granted, Wells Fargo Bank had a sales-assets ratio of 0.8%, exceeding even the highest thrift.

But while the rest of the top 10 commercial banks had ratings under 0.31%, all of the top 10 thrifts had ratings over 0.35%

"Thrifts typically have higher annuity sales for their asset size than commercial banks," said Andrew Singer, managing director of the Bank Insurance Market Research Group. "The thrifts have been at this business longer."

Many thrifts began selling annuities and mutual funds in the mid-1980s, five or more years before many banks.

Another reason thrifts are proportionately larger annuities sellers is that their customers tend to be older than bank customers, and thus more likely to buy annuities, Mr. Singer said.

Mr. Singer's organization analyzed and compiled the fourth-quarter data based on reports submitted by the thrifts to the Office of Thrift Supervision in 1994. That was the first year thrifts were required to report separate sales figures for mutual funds and annuities.

Of the 1,547 thrifts that reported to the Office of Thrift Supervision, 302 of them, or 20%, reported annuity sales in the fourth quarter. About 14%, or 212 thrifts, said they sold mutual funds in the same period. Not surprisingly, California thrifts led the nation in sales of annuities during the period.

Great Western Bank, with $39.9 billion in assets, was the top seller of annuities, with $171.3 million in sales. California Federal Bank, a $14 billion-asset thrift in Los Angeles, ranked second with $79.3 million in sales.

When compared with commercial banks, they would have ranked fourth and ninth, respectively, according to Mr. Singer.

In the fourth quarter, thrifts were more likely to sell annuities than mutual funds, reflecting an industrywide trend.

"1994 was the year of the fixed annuity," said Joseph Petitti, executive vice president of product and support services at California Federal. He said that in 1994, CalFed's sales were in a ratio of 70% annuities to 30% mutual funds, but that in most years the ratio is reversed.

Selling annuities and mutual funds is a big part of many thrifts' business, the data show. California Federal derived about one-third of its fourth-quarter fee income of $14.3 million from investment products, the thrift said. For the top commercial bank providers, that percentage rarely goes above 3%.

"Annuities and mutual funds are among the major sources of fee income for this bank," Mr. Petitti said. The thrift uses a combination of about 300 licensed branch bankers and full-service brokers to sell investment products.

Mr. Singer's company compiled the fourth-quarter data as a way to test its analytical software. Data for the earlier three quarters, and for the year, will be available in several weeks, he said.

Citicorp's California thrift affiliate, Citibank Federal Savings Bank, led in long-term mutual fund sales, which excludes money market funds. Citibank sold $354 million in long-term funds, followed by Great Western, with $133 million in long-term fund sales. That would place Citibank in fifth place, compared with commercial banks, and Great Western in 12th.

The top-selling thrifts have solved some of the problems with investment programs that commercial banks are grappling with. For instance, Great Western's proprietary mutual fund family, Sierra Trust, has $3 billion in assets. About 95% of the fund's assets are invested in long-term funds. Most proprietary bank funds have about 30% invested in long-term funds and the rest in money market funds, which are less profitable to the institution.

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