UJB Financial Corp. is taking another swing at the annuities business, teaming up with Western National Life Insurance Co. to develop a line of annuities that will carry the bank's name.
The $15 billion-asset banking company, through its subsidiaries United Jersey Bank and First Valley Bank, will begin marketing a proprietary fixed annuity within six months and will unveil a variable annuity shortly afterward, bank officials said.
It's the second time around for UJB, which earlier this year broke off a similar partnership with SunAmerica Corp. That deal fell through because the two companies could not decide on how to make the products profitable.
A spokeswoman for the Princeton, N.J.-based banking company said this time all the details have been ironed out, and they expect no delays in rolling out the annuities.
In the past two and a half years, about a dozen big banks have taken steps to develop proprietary annuities. Altogether, annuities managed by banks held $500.9 million as of May 31, according to Lipper Analytical Services, Summit, N.J.
UJB is no stranger to annuity and insurance sales. The banking company's retail investment sales program grew out of an earlier effort to market insurance to institutional and high-net worth customers.
The bank received a license to sell insurance in New Jersey in 1989 and since 1990 has branched out into selling other annuities from other companies, mutual funds, and individual securities throughout the Garden State and Pennsylvania.
UJB sold $100 million of investments last year, 60% of which were annuities, with mutual funds making up most of the rest, said Louis M. Daniels, senior vice president in charge of insurance services and alternative investments.
Western National and UJB will jointly develop the fixed and variable annuities, which the bank will market through its 45 investment sales representatives in 266 branches.
The bank-run variable annuities will use UJB's Pillar Funds family as their underlying security. The Pillar Funds have more than $1 billion of assets.