Efforts by the National Association of Securities Dealers to regulate sales of variable annuities more tightly may favor wirehouses over other VA retailers.[@@]

Andrew Kligerman, the lead life sector analyst at UBS Investment Research, New York, presents that conclusion in a research note based on a recent conference call with the executive in charge of the UBS annuities sales program.

The executive, John Mulhall, the UBS annuities product director, said a proposed NASD rule that could require registered principals to review and approve VA sales could strain the supervisory resources available to independent financial planners and small regional firms, Kligerman writes.

Regulatory challenges “have caused VA sales to dampen,” Kligerman writes.

But 2005 VA sales are down only about 7% from comparable 2004 VA sales total, while the increasing competitiveness of bank certificates of deposit has led to a much sharper decline in fixed annuity sales, Kligerman writes.