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DTCC Releases September Reports On Market Activity For Annuity Products

New York, October 26, 2011– The Depository Trust & Clearing Corporation (DTCC) Insurance & Retirement Services (I&RS) released today September reports on activity in the market for annuity products from its Analytic Reporting for Annuities online information service, which is based on the transactions that DTCC processes for the industry. According to DTCC I&RS:

• Inflows for all annuity types processed in September declined by 19% to $6.7 billion from $8.3 billion in August.
• Annuity inflows were at their highest so far this year in March, at nearly $8.8 billion.
• The top 10 insurance companies accounted for over 68% of all inflows processed in September.
• Quarterly inflows and net flows have shown only slight changes since the beginning of the year.

Share of Net Flows by Account Type

September inflows went primarily into IRA accounts and non-qualified accounts, with a small percentage going into 401k accounts. The percentage of inflows going in to Regular IRA accounts was nearly 50%, while non-qualified accounts received 40% of inflows. Accounts in 401k plans received almost 6% of annuity inflows.

However, looking at net cash flows (subtracting out flows from inflows) tells a different story: regular IRA accounts took the lion's share of net flows in September with 85%, or nearly $1.8 billion. 401k plans attracted almost 13% of net flows, with almost $265 million, while non-qualified accounts attracted only 4% of net flows, or just under $87 million.

Over the past 12 months, 77% of positive net flows have gone into regular IRA accounts and 12% have gone into 401k accounts. Non-qualified accounts attracted 7% of net flows.

Five hundred twenty two (522) annuity products saw positive net flows in September, while 2,105 annuity products saw negative net flows, where the amount of money redeemed exceeded the amount of money invested.

DTCC-RIIA Agreement

DTCC recently joined forces with the Retirement Income Industry Association (RIIA) to analyze cash flows by RIIA defined broker/dealer distribution channels and product categories. The following chart shows the breakdown of annuity product inflows by distribution channel in the third quarter.

About Analytic Reporting

Analytic Reporting for Annuities is an online information solution containing aggregated data from transactions processed by DTCC's Insurance & Retirement Services (I&RS). I&RS is the central messaging connection for annuity and life insurance transactions, enabling insurance companies to provide broker/dealers with daily financial transaction information. It processes approximately 150 million transactions each month.

Because Analytic Reporting is based on processed transactions, not surveyed data, Analytic Reporting gives DTCC customers a unique and unprecedented view of their own business as well as the market for annuity products so that they can discover key trends and identify opportunities. With updates approximately two to three weeks after each month-end, Analytic Reporting allows users to assess their business and access industry intelligence to support management decisions about sales, sales management, marketing and product offerings. Analytic Reporting is a hosted turnkey solution, available online anywhere, anytime. DTCC Members don't have to store or manage the data. They don't have to develop applications or run SQL queries to obtain the business information they rely on for decision making.

DTCC has added a page to its web site at http://www.dtcc.com/analytics for more information about the Analytic Reporting Service.

About DTCC

The Depository Trust & Clearing Corporation (DTCC), through its subsidiaries, provides clearing, settlement and information services for equities, corporate and municipal bonds, government and mortgage-backed securities, money market instruments and over-the-counter derivatives. In addition, DTCC is a leading processor of mutual funds and insurance transactions, linking funds and carriers with their distribution networks. DTCC's depository provides custody and asset servicing for 3.6 million securities issues from the United States and 121 other countries and territories, valued at almost $34 trillion. In 2010, DTCC settled more than $1.66 quadrillion in securities transactions. Insurance & Retirement Services (I&RS) is the DTCC division that processes annuity and insurance transactions. I&RS is the central messaging connection for annuity and life insurance transactions, enabling insurance companies to provide broker/dealers with daily financial transaction information. It processes approximately 150 million transactions each month.

The Analytic Reporting Service is a service offering of National Securities Clearing Corporation ("NSCC"), a clearing agency registered with the U.S. Securities and Exchange Commission and wholly-owned subsidiary of DTCC.