Not surprisingly, the BISA-Singer's Bank Holding Company Annuity Index plunged 9% in the fourth quarter, the Bank Insurance and Securities Association announced Thursday.
The decline follows a 9% decline in the third quarter.
"Recent reports describe 2010 as the worst year for bank-sold annuities in the past decade, so the 4th quarter decline in the BHC Annuity Index comes as little surprise,” said Andrew Singer, the editor of the index. “Only two of the ten banks in the Index notched gains in the fourth quarter, Fifth Third and Wells Fargo. Without Wells Fargo, the aggregate numbers would have been down substantially.”
The Index is an average based on quarterly annuity (both fixed and variable) revenues (not sales) at 10 large bank holding companies as reported to the Federal Reserve Board. The index fell from 93 in the third quarter to 85 in the fourth quarter.
Aggregate annuity revenue at the 10 bank companies covered increased 2% to $288.91 million from $283.32 million in the previous quarter. (To see table, click here.)
The Index is produced jointly by BISA and Singer's Annuity & Funds Report.
During the fourth quarter, sales (not revenues) of the subset of fixed annuities across all depository institutions were an estimated $3.17 billion, according to the Beacon Research Fixed Annuity Premium Study. This was a decrease of 20% from the prior quarter and 48% from a year earlier.