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Community Bank Brokerages Hold Their Own

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Community banks and credit unions were more productive at generating brokerage revenue during the second quarter than bigger banks were.

Community financial institutions averaged $627 in brokerage revenue per $1 million in retail deposits during the quarter, while banks with more than $4 billion in assets averaged $559 in brokerage revenue per $1 million in retail deposits, according to Kehrer-LIMRA, a unit of LIMRA International, Windsor, Conn.

Community institutions were more productive than big banks at generating brokerage revenue for the second quarter in a row, Kehrer-LIMRA says.

Small bank revenue penetration was up 42% from the average of $442 per $1 million in deposits for the second quarter of 2006.

Average monthly gross revenue per community bank financial advisor, including trailers and advisory fees from managed money, increased to $24,281 for the quarter, up 12% from the average for the second quarter 2006.

The share of small bank brokerage revenue generated by variable annuities increased to 38% of brokerage revenue in the second quarter, up from 33% in the second quarter of 2006.

The share generated by fixed annuities dropped to 5%, from 11%, while the share generated by mutual funds held steady at 26%.