EXHIBIT (b)(5)(b)
  

                              THE AAL MUTUAL FUNDS

                             SUB-ADVISORY AGREEMENT


         AGREEMENT  made this 12th day of July 1995 by and among THE AAL  MUTUAL
FUNDS (the "Trust"),  a  Massachusetts  Business Trust,  AAL CAPITAL  MANAGEMENT
CORPORATION (the "Adviser"),  a Delaware  corporation and SOCIETE GENERALE ASSET
MANAGEMENT CORP. (the "Sub-Adviser"), a Delaware corporation.
                                   WITNESSETH:
         In consideration of the mutual promises and agreements herein contained
and  other  good and  valuable  consideration,  the  receipt  of which is hereby
acknowledged, it is hereby agreed by and among the parties hereto as follows:
         
1.   In General

     The  Sub-Adviser  agrees,  as  more  fully  set  forth  herein,  to  act as
Sub-Adviser to the Trust with respect to the investment and  reinvestment of the
assets of the Trust's series of shares described as The AAL  International  Fund
(the "Fund").  It is understood that the Trust may create one or more additional
Fund  series  from time to time and that this  Agreement  may be  amended by the
mutual written agreement of the parties to include such additional Fund(s) under
the terms to this Agreement.

<PAGE>



2.   Duties and  Obligations  of the  Sub-Adviser  with Respect to Investment of
     Assets of The AAL International Fund

     (a) Subject to the succeeding provisions of this section and subject to the
oversight  and review of the Adviser and the  direction and control of the Board
of Trustees of the Trust, the Sub-Adviser,  as agent and  attorney-in-fact  with
respect  to the  Trust,  is  authorized,  in its  discretion  and  within  prior
consultation  with the Trust to:  (i) Buy,  sell,  exchange,  convert,  lend and
otherwise trade in any stocks,  bonds, and any other securities or assets;  (ii)
Place  orders  and  negotiate  the  commissions  (if any) for the  execution  of
transactions  in  securities  or other  assets  with or  through  such  brokers,
dealers,  underwriters  or issuers as the  Sub-Advisers  may  select;  including
brokers and dealers that may be affiliate of the Sub-Adviser,  and (iii) Provide
the Adviser and the Trustees with such reports as may reasonably be requested in
connection  with  the  discharge  of  the  foregoing  responsibilities  and  the
discharge  of the  Adviser's  responsibilities  under  the  Investment  Advisory
Agreement with the Trust and those of AAL Capital  Management  Corporation  (the
"Distributor")  under  the  Distribution   Agreement  with  the  Trust.  Written
procedures  with respect to (i), (ii) and (iii) above may be set forth as agreed
to among the Trust, the Adviser and Sub-Adviser.

     (b) Any investment  purchases or sales made by the  Sub-Adviser  under this
section  shall  at  all  times  conform  to,  and  be in  accordance  with,  any
requirements  imposed by: (1) the  provisions of the  Investment  Company Act of
1940 (the "Act") and of any rules or  regulations in force  thereunder;  (2) any
other  applicable  provisions of law; (3) the  provisions of the  Declaration of
Trust and By-Laws of the Trust as amended  from time to time;  (4) any  policies
and  determinations  of  the  Board  of  Trustees  of the  Trust;  and  (5)  the
fundamental  policies of the Trust, as reflected in its  Registration  Statement
under the Act,  or as amended by the  shareholders  of the Trust  provided  that
copies of the items  referred  to in  clauses  (3),  (4) and (5) shall have been
furnished to the Sub-Adviser.

     (c) The  Sub-Adviser  shall give the Trust the benefit of its best judgment
and  effort  in  rendering  services  hereunder.   In  the  absence  of  willful
misfeasance,   bad  faith,   gross  negligence  or  reckless  disregard  of  its
obligations  and  duties  ("disabling  conduct")  hereunder  on the  part of the
Sub-Adviser  (and  its  officers,  directors,  agents,  employees,   controlling
persons,  shareholders  and any  other  person  or  entity  affiliated  with the
Sub-Adviser)  the Sub-Adviser  shall not be subject to liability to the Trust or
to any  shareholder  of the Trust for any act or  omission  in the course of, or
connected with rendering services hereunder,  including without limitation,  any
error of judgment  or mistake of law or for any loss  suffered by any of them in
connection  with the  matters to which  this  Agreement  relates,  except to the
extent  specified in Section 36 (b) of the Act concerning  loss resulting from a
breach of  fiduciary  duty with  respect  to the  receipt  of  compensation  for
services.  Except for such  disabling  conduct,  the Trust shall  indemnify  the
Sub-Adviser  (and  its  officers,  directors,  agents,  employees,   controlling
persons,  shareholders  and any  other  person  or  entity  affiliated  with the
Sub-Adviser) against any liability arising from the Sub-Adviser's  conduct under
this  Agreement  to  the  extent  permitted  by the  Declaration  of  Trust  and
applicable  law. 

     (d)  Nothing  in  this  Agreement  shall  prevent  the  Sub-Adviser  or any
"affiliated  person" (as defined in the Act) of the  Sub-Adviser  from acting as
investment  adviser or manager for any other  person,  firm or  corporation  and
shall not in any way limit or restrict the  Sub-Adviser  or any such  affiliated
person  from  buying,  selling or trading  any  securities  for its or their own
accounts  or for the  accounts  of  others  for whom it or they  may be  acting,
provided,  however,  that  the  Sub-Adviser  expressly  represents  that it will
undertake  no  activities  which,  in its  judgment  will  adversely  affect the
performance of its obligations to the Trust under this  Agreement.  It is agreed
that the Sub-Adviser  shall have no responsibility or liability for the accuracy
or  completeness  of the Trust's  Registration  Statement  under the Act and the
Securities Act of 1933 except for  information  supplied by the  Sub-Adviser for
inclusion therein. The Sub-Adviser provided or authorized,  have no authority to
act or  represent  the Trust in any way or  otherwise  be deemed an agent of the
Trust.

     (e) In  connection  with its duties to arrange for the purchase and sale of
the Fund's portfolio  securities and other assets,  the Sub-Adviser shall follow
the  principles set forth in any  investment  advisory  agreement in effect from
time to time between the Trust and the Adviser, provided that a copy of any such
agreement  shall have been provided to the  Sub-Adviser.  The  Sub-Adviser  will
promptly  communicate to the Adviser and to the officers and the Trustees of the
Trust such information relating to portfolio transactions as they may reasonably
request.

     (f)  The  Sub-Adviser  shall  be  responsible  for  13F  reporting  for the
securities held by The AAL International Fund.
       
3.   Allocation of Expenses

     The Sub-Adviser agrees that it will furnish the Trust, at the Sub-Adviser's
expense, with all office space,  facilities,  equipment,  and clerical personnel
necessary for carrying out its duties under this Agreement. The Sub-Adviser will
pay all compensation of those of the Trust's officers and employees, if any, and
of those  Trustees,  if any,  who is each  case are  affiliated  persons  of the
Sub-Adviser.

4.   Certain Records

     Any  records  required  to be  maintained  and  preserved  pursuant  to the
provisions  of Rule 31a-1 and Rule  31a-2  under the Act which are  prepared  or
maintained  by the  Sub-Adviser  on behalf of the Trust are the  property of the
Trust and will be surrendered promptly tot he Trust or Adviser on request.
        
5.   Reference to the Sub-Adviser

     Neither the Trust, the Adviser or any affiliate or agent thereof shall make
reference to or use the name of the  Sub-Adviser or any of its affiliates in any
advertising  or  promotional   materials  without  the  prior  approval  of  the
Sub-Adviser, which approval shall not be unreasonably withheld.
         
6.   Compensation of the Sub-Adviser

     The Adviser agrees to pay the  Sub-Adviser  and the  Sub-Adviser  agrees to
accept as full  compensation  for all services  rendered by the  Sub-Adviser  as
such, a management fee, payable quarterly in arrears and computed on the average
daily net asset value of The AAL International  Fund at rates shown on Exhibit A
attached hereto.
         
7.   Duration and Termination

     (a) This Agreement shall go into effect for The AAL  International  Fund on
August 1, 1995, and shall, unless terminated as hereinafter  provided,  continue
in effect  thereafter from year to year, but only so long as such continuance is
specifically  approved at least  annually by a majority of the Trust's  Board of
Trustees,  or by the vote of the holders of a "majority" (as defined in the Act)
of the  outstanding  voting  securities  of the Fund,  and,  in either  case,  a
majority of the  Trustees who are not parties to this  Agreement or  "interested
persons"  (as  defined in the Act) of any such party cast in person at a meeting
called for the purpose of voting on such approval.

     (b) This Agreement may be terminated by the Sub-Adviser at any time without
penalty upon giving the Trust and the Adviser  sixty (60) days'  written  notice
(which  notice may be waived by the Trust and Adviser) and may be  terminated by
the Trust or the Adviser at any time without penalty upon giving the Sub-Adviser
sixty (60) days' written notice (which notice may be waived by the Sub-Adviser),
provided that such termination by the Trust shall be directed or approved by the
vote of a majority  of all of the  Trustees in office at the time or by the vote
of the holders of a majority (as defined in the Act) of the voting securities of
the  Trust,  or with  respect  to any  Fund by the  vote  of a  majority  of the
outstanding shares of such Fund. This Agreement shall automatically terminate in
the event of its  "assignment" (as defined in the Act). This Agreement will also
terminate in the event that the Investment Advisory Agreement is terminated.

8.   Agreement Binding Only On Trust Property

         The Sub-Adviser  understands that the obligations of this Agreement are
not binding  upon any  shareholder  of the Trust  personally,  but bind only the
Trust's  property;  the  Sub-Adviser  represents  that  it  has  notice  of  the
provisions of the Trust's Declaration of Trust disclaiming shareholder liability
for acts or obligations of the Trust.
         
9.   Action By Individual Fund

     The provisions of this Agreement and any amendments  hereto with respect to
a Fund may be approved  by the  shareholders  of that Fund and become  effective
with  respect to the  assets of that Fund  without  the  necessity  of  approval
thereof by  shareholders  of any other  Fund.  The Adviser  represents  that the
holders of a majority  (as defined in the "Act") of the Fund,  will  approve the
entry into this Agreement on behalf of the Fund.

10.  Notices

     (a) The Sub-Adviser agrees to promptly notify the Adviser of the occurrence
of any of the following events:

          (1)  any  change  in any  of the  Sub-Adviser's  office  or  portfolio
               managers;
                  
          (2)  the Sub-Advisers  fails to be registered as an investment adviser
               under the Advisers Act or under the laws of any  jurisdiction  in
               which  the  Sub-Adviser  is  required  to  be  registered  as  an
               investment adviser in order to perform its obligations under this
               Agreement;

          (3)  the Sub-Adviser is the subject of any action,  suit,  proceeding,
               inquiry or  investigation  at law or in equity  before any court,
               public board or body, involving the affairs of the Fund; or

          (4)  any change in ownership or control of the Sub-Adviser.

     (b) Any notice  given  hereunder  shall be in writing  and may be served by
being sent by telex,  facsimile  or other  electronic  transmission,  or sent by
registered  mail or by courier to the  address set forth below for the party for
which it is intended.  A notice served by mail shall be deemed served seven days
after  mailing  and  in  the  case  of  telex,  facsimile  or  other  electronic
transmission,  twelve hours after dispatch thereof.  Addresses for notice may be
changed by written notice to the other party.


<PAGE>


The Adviser
Robert G. Same, Sr. Vice President
AAL CAPITAL MANAGEMENT CORPORATION
222 West College Avenue
Appleton, WI  54919

The  Sub-Adviser   
Jean-Marie   Eveillard,   President  
SOCIETE  GENERALE  ASSET MANAGEMENT CORP.
1221 Avenue of the Americas, Eighth Floor
New York, NY  10020
Fax (212) 278-5911

<PAGE>


         IN WITNESS  WHEREOF,  the  parties  hereto  have  caused the  foregoing
instrument to be executed by their duly  authorized  officers and their seals to
be hereunto affixed, all as of the day and year first above written.


ATTEST:                                      THE AAL MUTUAL FUNDS


/s/ Robert G. Same                           /s/ John H. Pender
-----------------------------                -------------------------------
Robert G. Same, Secretary                    John H. Pender, President




ATTEST:                                      AAL CAPITAL MANAGEMENT
                                             CORPORATION



/s/ Robert G. Same                           /s/ H. Michael Spence
-----------------------------                -------------------------------
Robert G. Same, Secretary                   H. Michael Spence, President






ATTEST:                                      SOCIETE GENERALE ASSET
                                             MANAGEMENT CORP



/s/ Philip J. Bafundo                        /s/ Jean-Marie Eveillard
-----------------------------                -------------------------------
Philip J. Bafundo, Secretary                 Jean-Marie Eveillard, President


<PAGE>



                                    EXHIBIT A
                                       TO
                   THE AAL MUTUAL FUNDS SUB-ADVISORY AGREEMENT
                             (Dated August 1, 1995)

1.       The AAL International Fund (effective August 1, 1995)

     The management fee for this Fund payable to the Sub-Adviser by the Adviser,
calculated in accordance  with paragraph 6 of The AAL Mutual Funds  Sub-Advisory
Agreement, shall be at the annual rate of:

          .75 of 1% of the Fund's average daily net assets

<PAGE>


                                 Amendment No. 1
                                       to
                   THE AAL MUTUAL FUNDS SUB-ADVISORY AGREEMENT
                              (Dated July 12, 1995)

         The  Sub-Advisory  Agreement  between The AAL Mutual Funds, AAL Capital
Management  Corporation  (the "Adviser") and Societe  Generale Asset  Management
Corp.  (the  "Sub-Adviser"),  effective  August  1,  1995,  is  hereby  amended,
effective December 1, 1997, as follows:

     1.  Schedule A attached to the Sub-Advisory  Agreement (effective August 1,
         1995) is  modified  to revise the fee  schedule  for The  International
         Fund. An amended  Schedule A,  effective  December 1, 1997, is attached
         hereto.

IN WITNESS WHEREOF the parties hereto have caused this Amendment to be signed by
the respective officers effective as of December 1, 1997.



ATTEST:                                      THE AAL MUTUAL FUNDS



/s/ Robert G. Same                           /s/Ronald G. Anderson
-----------------------------                -------------------------------
Robert G. Same, Secretary                    Ronald G. Anderson, President



ATTEST:                                      AAL CAPITAL MANAGEMENT
                                             CORPORATION



/s/ Robert G. Same                           /s/Ronald G. Anderson
-----------------------------                -------------------------------
Robert G. Same, Secretary                    Ronald G. Anderson, President



ATTEST:                                      SOCIETE GENERALE ASSET
                                             MANAGEMENT CORP



/s/ Philip J. Bafundo                        /s/ Jean-Marie Eveillard
-----------------------------                -------------------------------
Philip J. Bafundo, Secretary                 Jean-Marie Eveillard, President

<PAGE>



                                    EXHIBIT A

                                 AMENDMENT NO. 1
                                       TO
                   THE AAL MUTUAL FUNDS SUB-ADVISORY AGREEMENT
                            (Dated December 1, 1997)


1.       The AAL International Fund (effective December 1, 1997)

         The  management  fee for this Fund  payable to the  Sub-Adviser  by the
Adviser,  calculated  in  accordance  with  paragraph 6 of The AAL Mutual  Funds
Sub-Advisory Agreement, shall be at the annual rate of :

         .55 of 1% of the Fund's average daily net assets.