Bank insurance first-quarter brokerage fee income was up 3.9 percent compared with the first quarter of 2006, according to a report by a consulting firm and a life insurer.
The Bank Fee Income Report (FIR)–compiled by consultants Michael White Associates, LLC in Radnor, Pa., and sponsored by Symetra Financial of Bellevue, Wash.–said this year's first-quarter income was $993.3 million, up 3.9 percent from $956 million in the 2006 period.
According to the report, one-fourth of the way through the year, 2,895 banks reported earning some insurance brokerage fee income, constituting 37.1 percent of all 7,813 commercial and savings banks.
In first place among bank brokerage activity rankings was New York-based Citibank, N.A., with insurance brokerage earnings of $266 million, the report said.
Branch Banking and Trust Company of Winston Salem, N.C., which operates 82 insurance agencies, ranked second nationally with $193.4 million in insurance brokerage fee income, White-Symetra reported.
FIA Card Services, N.A., of Wilmington, Del.–the former MBNA America Bank, N.A. now owned by Bank of America Corp.–ranked third with $51.4 million in insurance brokerage revenue, the report said.
White-Symetra said banks with over $10 billion in assets continued to have the highest participation (68.1 percent) in insurance brokerage activities, producing $766.3 million in insurance fee income in first quarter 2007–5.5 percent more than the $726.2 million they produced in first quarter 2006.
These large banks accounted for 77.1 percent of all first-quarter bank insurance brokerage fee income.
The report found the greatest rate of growth in insurance brokerage fee income occurred among banks with assets between $300 million and $500 million, as insurance brokerage fee income grew 11.9 percent–from $20.0 million in first quarter 2006 to $22.4 million in first quarter 2007.
Nationally, White-Symetra said the ratio of mean insurance brokerage fee income to noninterest income decreased slightly from 6.8 percent to 6.6 percent. Ten of the top 15 banks exceeded that mean ratio. Four of them reported insurance brokerage fee income representing more than 30 percent of their noninterest income. Seven of the top 15 banks had a ratio greater than 15 percent.
The bank insurance brokerage fee income report consists of commissions and fees earned by a bank or its subsidiary from insurance product sales and referrals of property, casualty, title, credit, life and health insurance.
It does not include income earned from the sale or servicing of annuities, which was, until this year, reported as insurance when the sales were not made by the bank's securities brokerage operations.
White-Symetra said the report is based on data reported by all 7,813 commercial and FDIC-regulated savings banks.
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