UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) July 29, 2015
METLIFE, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
1-15787 | 13-4075851 | |
(Commission File Number) | (IRS Employer Identification No.) | |
200 Park Avenue, New York, New York | 10166-0188 | |
(Address of Principal Executive Offices) | (Zip Code) |
212-578-9500
(Registrants Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On July 29, 2015, MetLife, Inc. (the Company) issued (i) a news release announcing its results for the quarter ended June 30, 2015 (the Earnings Release), a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference, (ii) a Quarterly Financial Supplement for the quarter ended June 30, 2015 (the Quarterly Financial Supplement), a copy of which is attached hereto as Exhibit 99.2 and is incorporated herein by reference and (iii) a video second quarter 2015 financial update from chief financial officer John Hele, a transcript and description of which are attached hereto as Exhibit 99.3 (the Video Description) and are incorporated herein by reference. The Earnings Release, the Quarterly Financial Supplement and the Video Description are furnished and not filed pursuant to instruction B.2 of Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(a) | Not applicable. |
(b) | Not applicable. |
(c) | Not applicable. |
(d) | Exhibits |
99.1 | News release of MetLife, Inc., dated July 29, 2015, announcing its results for the quarter ended June 30, 2015 |
99.2 | Quarterly Financial Supplement for the quarter ended June 30, 2015 |
99.3 | Description of video second quarter 2015 financial update from chief financial officer John Hele |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
METLIFE, INC. | ||||
By: |
/s/ Timothy J. Ring | |||
Name: |
Timothy J. Ring | |||
Title: |
Senior Vice President and Secretary |
Date: July 29, 2015
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EXHIBIT INDEX
EXHIBIT NUMBER |
EXHIBIT | |
99.1 | News release of MetLife, Inc., dated July 29, 2015, announcing its results for the quarter ended June 30, 2015 | |
99.2 | Quarterly Financial Supplement for the quarter ended June 30, 2015 | |
99.3 | Description of video second quarter 2015 financial update from chief financial officer John Hele |
Exhibit 99.1
Contacts: | For Media: | John Calagna | ||
(212) 578-6252 | ||||
For Investors: | Edward Spehar | |||
(212) 578-7888 |
METLIFE ANNOUNCES SECOND QUARTER 2015 RESULTS
NEW YORK, July 29, 2015 MetLife, Inc. (NYSE: MET) today reported the following results for the second quarter of 2015:
MetLife reported operating earnings* of $1.8 billion, up 11 percent from the second quarter of 2014, and up 16 percent on a constant currency basis*. On a per share basis, operating earnings were $1.56, up 12 percent over the prior year quarter. Operating earnings in the Americas grew 4 percent on a reported basis and 6 percent on a constant currency basis. Operating earnings in Asia increased 31 percent on a reported basis and were up 45 percent on a constant currency basis. Operating earnings in Europe, the Middle East and Africa (EMEA) decreased 31 percent on a reported basis and were down 7 percent on a constant currency basis.
Second quarter 2015 operating earnings included the following item:
| a one-time tax rate change in Japan, which increased operating earnings by $61 million, or $0.05 per share, after tax |
MetLifes operating return on equity (ROE), excluding accumulated other comprehensive income (AOCI) other than foreign currency translation adjustments (FCTA)*, was 12.5 percent for the second quarter of 2015, and the companys tangible operating ROE* was 15.3 percent.
On a GAAP basis, MetLife reported second quarter 2015 net income of $1.0 billion, or $0.92 per share. Net income includes $593 million, after tax, in net derivative losses, mainly due to rising interest rates, as well as weakening of the U.S. dollar against certain currencies. MetLife uses derivatives as part of its broader asset-liability management strategy to hedge certain risks, such as movements in interest rates and foreign currencies. This hedging activity often generates derivative gains or losses and creates fluctuations in net income because the risk being hedged may not have the same GAAP accounting treatment.
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The second quarter variance between operating earnings and net income reflects asymmetrical and non-economic accounting of $856 million, after tax. Net income adjusted for asymmetrical and non-economic accounting was above operating earnings primarily due to the portion of the one-time tax benefit in Japan relating to net investment gains.
Premiums, fees & other revenues* were $12.2 billion, down 4 percent (essentially unchanged on a constant currency basis) over the second quarter of 2014.
Book value, excluding AOCI other than FCTA*, was $50.73 per share, up 4 percent from $48.60 at June 30, 2014.
MetLife delivered strong double-digit operating earnings growth in the second quarter, said Steven A. Kandarian, chairman, president and chief executive officer of MetLife, Inc. Investment margins remained healthy despite persistent low interest rates, and underwriting margins improved year over year for the fourth consecutive quarter.
SECOND QUARTER 2015 SUMMARY
($ in millions, except per share data) | Three months ended June 30 | |||||||||||
2015 | 2014 | Change | ||||||||||
Premiums, fees & other revenues |
$ | 12,175 | $ | 12,706 | (4 | %) | ||||||
Total operating revenues |
$ | 17,360 | $ | 17,801 | (2 | %) | ||||||
Operating earnings |
$ | 1,765 | $ | 1,590 | 11 | % | ||||||
Operating earnings per share |
$ | 1.56 | $ | 1.39 | 12 | % | ||||||
Net income |
$ | 1,042 | $ | 1,335 | (22 | %) | ||||||
Net income per share |
$ | 0.92 | $ | 1.17 | (21 | %) | ||||||
Book value per share, excluding AOCI other than FCTA |
$ | 50.73 | $ | 48.60 | 4 | % | ||||||
Book value per share tangible common stockholders equity |
$ | 41.73 | $ | 38.69 | 8 | % | ||||||
Book value per share |
$ | 60.27 | $ | 59.96 | 1 | % |
* | Information regarding the non-GAAP financial measures included in this news release and the reconciliation of the non-GAAP financial measures to GAAP measures is provided in the Non-GAAP and Other Financial Disclosures discussion below, as well as in the tables that accompany this release and/or the Second Quarter 2015 Financial Supplement (which is available on the MetLife Investor Relations Web page at www.metlife.com). |
BUSINESS DISCUSSIONS
All comparisons of the results for the second quarter of 2015 in the business discussions that follow are with the second quarter of 2014, unless otherwise noted.
THE AMERICAS
Total operating earnings for the Americas were $1.4 billion, up 4 percent (6 percent on a constant currency basis), driven by investment and underwriting margins, as well as business growth. Operating return on allocated equity* was 14.8 percent for the second quarter and operating return on allocated tangible equity* was 16.6 percent. Premiums, fees & other revenues were $9.2 billion, down 4 percent, and down 2 percent on a constant currency basis. Excluding pension closeouts, premiums, fees & other revenues were down 1 percent (and essentially unchanged on a constant currency basis).
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Retail
Operating earnings for Retail were $690 million, up 2 percent, driven by underwriting and higher variable investment income. Premiums, fees & other revenues were $3.3 billion, down 2 percent mostly due to lower income annuity sales.
Group, Voluntary & Worksite Benefits
Operating earnings for Group, Voluntary & Worksite Benefits were $231 million, up 11 percent, driven by business growth and underwriting. Premiums, fees & other revenues were $4.4 billion, up 2 percent reflecting an increase in life, dental, and voluntary products.
Corporate Benefit Funding
Operating earnings for Corporate Benefit Funding were $406 million, up 12 percent, due to an increase in investment margins. Premiums, fees & other revenues were $455 million, down 44 percent, due to lower pension closeouts and structured settlement annuity sales.
Latin America
Operating earnings for Latin America were $116 million, down 15 percent on a reported basis, but up 3 percent on a constant currency basis. Excluding U.S. Direct, operating earnings were down 5 percent on a reported basis, but up 13 percent on a constant currency basis. Total premiums, fees & other revenues were $1.1 billion, down 3 percent on a reported basis, but up 13 percent on a constant currency basis, with growth across the region. Total sales for the region decreased 40 percent on a constant currency basis, primarily due to the impact of a large contract in Mexico in the second quarter of 2014. Excluding this large contract, sales were up 4 percent in the region in the second quarter of 2015.
ASIA
Operating earnings for Asia were $425 million, up 31 percent on a reported basis, and up 45 percent on a constant currency basis. This includes the previously mentioned $61 million Japan tax rate change. Excluding this tax item, operating earnings were up 24 percent on a constant currency basis, reflecting strong business growth. Operating return on allocated equity was 14.8 percent for the second quarter and operating return on allocated tangible equity was 25.4 percent. Excluding the tax item, operating return on allocated equity was 12.7 percent and operating return on allocated tangible equity was 21.8 percent. Premiums, fees & other revenues in Asia were $2.2 billion, down 4 percent on a reported basis, but up 9 percent on a constant currency basis, driven by strong growth across all key markets. Total sales for the region increased 1 percent on a constant currency basis, due to growth in Japan and continued strong growth in accident & health sales across the region, offset by a decline in retirement sales.
EMEA
Operating earnings for EMEA were $50 million, down 31 percent on a reported basis, and down 7 percent on a constant currency basis. Second quarter 2014 results were aided by $7 million in tax-related items. Operating return on allocated equity was 6.0 percent for the second quarter and operating return on allocated tangible equity was 11.2 percent. Premiums, fees & other revenues
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were $658 million, down 8 percent on a reported basis, but up 10 percent on a constant currency basis. Total sales for the region increased 7 percent on a constant currency basis, driven by employee benefit and accident & health sales.
INVESTMENTS
Net investment income was $5.2 billion, up 2 percent. Variable investment income was $427 million ($278 million, after tax and deferred acquisition costs (DAC)), compared with $342 million ($221 million, after tax and DAC) in the second quarter of 2014.
Rising interest rates contributed to derivative net losses of $721 million, after tax and other adjustments. Derivative net gains in the second quarter of 2014 were $71 million, after tax and other adjustments.
CORPORATE & OTHER
Corporate & Other had an operating loss of $153 million compared with an operating loss of $191 million in the second quarter of 2014.
Conference Call
MetLife will hold its second quarter 2015 earnings conference call and audio webcast on Thursday, July 30, 2015, from 8-9 a.m. EDT. The conference call will be available live via telephone and the Internet. To listen via telephone, dial 800-230-1074 (U.S.) or 612-234-9959 (outside the U.S.). To listen to the conference call via the Internet, visit www.metlife.com through a link on the Investor Relations page. Those who want to listen to the call via telephone or the Internet should dial in or go to the website at least 15 minutes prior to the call to register, and/or download and install any necessary audio software.
The conference call will be available for replay via telephone and the Internet beginning at 10 a.m. EDT on Thursday, July 30, 2015, until Thursday, August 6, 2015, at 11:59 p.m. EDT. To listen to a replay of the conference call via telephone, dial 800-475-6701 (U.S.) or 320-365-3844 (outside the U.S.). The access code for the replay is 344936. To access the replay of the conference call over the Internet, visit the above-mentioned website.
A brief video of CFO John Hele discussing second quarter 2015 results can be viewed at www.metlife.com/earningsvideo.
About MetLife
MetLife, Inc. (NYSE: MET), through its subsidiaries and affiliates (MetLife), is one of the largest life insurance companies in the world. Founded in 1868, MetLife is a global provider of life insurance, annuities, employee benefits and asset management. Serving approximately 100 million customers, MetLife has operations in nearly 50 countries and holds leading market positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, visit www.metlife.com.
Non-GAAP and Other Financial Disclosures
Any references in this news release (except in this section and in the tables that accompany this release) to net income (loss), net income (loss) per share, operating earnings, operating earnings per share, book value per share, book value per share, excluding accumulated other comprehensive income (loss) (AOCI) other than foreign
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currency translation adjustments (FCTA), book value per share-tangible common stockholders equity, premiums, fees and other revenues, operating return on equity, excluding AOCI other than FCTA, and tangible operating return on equity should be read as net income (loss) available to MetLife, Inc.s common shareholders, net income (loss) available to MetLife, Inc.s common shareholders per diluted common share, operating earnings available to common shareholders, operating earnings available to common shareholders per diluted common share, book value per common share, book value per common share, excluding AOCI other than FCTA, book value per common share-tangible common stockholders equity, premiums, fees and other revenues (operating), operating return on MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA, and operating return on MetLife, Inc.s tangible common stockholders equity, respectively.
Operating earnings is the measure of segment profit or loss that MetLife uses to evaluate segment performance and allocate resources. Consistent with accounting principles generally accepted in the United States of America (GAAP) accounting guidance for segment reporting, operating earnings is MetLifes measure of segment performance. Operating earnings is also a measure by which MetLife senior managements and many other employees performance is evaluated for the purposes of determining their compensation under applicable compensation plans.
Operating earnings is defined as operating revenues less operating expenses, both net of income tax. Operating earnings available to common shareholders is defined as operating earnings less preferred stock dividends.
Operating revenues and operating expenses exclude results of discontinued operations and other businesses that have been or will be sold or exited by MetLife and are referred to as divested businesses. Operating revenues also excludes net investment gains (losses) (NIGL) and net derivative gains (losses) (NDGL). Operating expenses also excludes goodwill impairments.
The following additional adjustments are made to GAAP revenues, in the line items indicated, in calculating operating revenues:
| Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to NIGL and NDGL and certain variable annuity guaranteed minimum income benefits (GMIB) fees (GMIB fees); |
| Net investment income: (i) includes amounts for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments but do not qualify for hedge accounting treatment, (ii) includes income from discontinued real estate operations, (iii) excludes post-tax operating earnings adjustments relating to insurance joint ventures accounted for under the equity method, (iv) excludes certain amounts related to contractholder-directed unit-linked investments, and (v) excludes certain amounts related to securitization entities that are variable interest entities (VIEs) consolidated under GAAP; and |
| Other revenues are adjusted for settlements of foreign currency earnings hedges. |
The following additional adjustments are made to GAAP expenses, in the line items indicated, in calculating operating expenses:
| Policyholder benefits and claims and policyholder dividends excludes: (i) changes in the policyholder dividend obligation related to NIGL and NDGL, (ii) inflation-indexed benefit adjustments associated with contracts backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass through adjustments, (iii) benefits and hedging costs related to GMIBs (GMIB costs), and (iv) market value adjustments associated with surrenders or terminations of contracts (Market value adjustments); |
| Interest credited to policyholder account balances includes adjustments for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of policyholder account balances but do not qualify for hedge accounting treatment and excludes amounts related to net investment income earned on contractholder-directed unit-linked investments; |
| Amortization of DAC and value of business acquired (VOBA) excludes amounts related to: (i) NIGL and NDGL, (ii) GMIB fees and GMIB costs and (iii) Market value adjustments; |
| Amortization of negative VOBA excludes amounts related to Market value adjustments; |
| Interest expense on debt excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and |
| Other expenses excludes costs related to: (i) noncontrolling interests, (ii) implementation of new insurance regulatory requirements, and (iii) acquisition and integration costs. |
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Operating earnings also excludes the recognition of certain contingent assets and liabilities that could not be recognized at acquisition or adjusted for during the measurement period under GAAP business combination accounting guidance. In addition to the tax impact of the adjustments mentioned above, provision for income tax (expense) benefit also includes the impact related to the timing of certain tax credits, as well as certain tax reforms.
MetLife, Inc.s tangible common stockholders equity is defined as MetLife, Inc.s common stockholders equity, excluding the net unrealized investment gains (losses) and defined benefit plans adjustment components of AOCI and is also reduced by the impact of goodwill, value of distribution agreements (VODA) and value of customer relationships acquired (VOCRA), all net of income tax. MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA, is defined as MetLife, Inc.s common stockholders equity, excluding the net unrealized investment gains (losses) and defined benefit plans adjustment components of AOCI, net of income tax.
MetLife believes the presentation of operating earnings and operating earnings available to common shareholders as MetLife measures it for management purposes enhances the understanding of the companys performance by highlighting the results of operations and the underlying profitability drivers of the business. Operating revenues, operating expenses, operating earnings, operating earnings available to common shareholders, operating earnings available to common shareholders per diluted common share, investment portfolio gains (losses) and derivative gains (losses) should not be viewed as substitutes for the following financial measures calculated in accordance with GAAP: GAAP revenues, GAAP expenses, income (loss) from continuing operations, net of income tax, net income (loss) available to MetLife, Inc.s common shareholders, net income (loss) available to MetLife, Inc.s common shareholders per diluted common share, net investment gains (losses) and net derivative gains (losses), respectively. MetLife, Inc.s tangible common stockholders equity and MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA, should not be viewed as substitutes for total MetLife, Inc.s stockholders equity calculated in accordance with GAAP. Reconciliations of these measures to the most directly comparable GAAP measures are included in the Second Quarter 2015 Financial Supplement and/or in the tables that accompany this earnings news release.
Operating return on MetLife, Inc.s tangible common stockholders equity is defined as operating earnings available to common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by MetLife, Inc.s average tangible common stockholders equity.
Operating return on MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA, is defined as operating earnings available to common shareholders divided by MetLife, Inc.s average common stockholders equity, excluding AOCI other than FCTA.
Operating return on MetLife, Inc.s common stockholders equity is defined as operating earnings available to common shareholders divided by MetLife, Inc.s average common stockholders equity.
Return on MetLife, Inc.s tangible common stockholders equity is defined as net income (loss) available to MetLife, Inc.s common shareholders, excluding goodwill impairment and amortization of VODA and VOCRA, net of income tax, divided by MetLife, Inc.s average tangible common stockholders equity.
Return on MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA, is defined as net income (loss) available to MetLife, Inc.s common shareholders divided by MetLife, Inc.s average common stockholders equity, excluding AOCI other than FCTA.
Return on MetLife, Inc.s common stockholders equity is defined as net income (loss) available to MetLife, Inc.s common shareholders divided by MetLife, Inc.s average common stockholders equity.
Allocated equity is defined as the portion of MetLife, Inc.s common stockholders equity that management allocates to each of its segments and sub-segments based on local capital requirements and economic capital. Economic capital is an internally developed risk capital model, the purpose of which is to measure the risk in the business and to provide a basis upon which capital is deployed. MetLife management periodically reviews this
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model to ensure that it remains consistent with emerging industry practice standards and the local capital requirements; allocated equity may be adjusted if warranted by such review. Allocated equity excludes the impact of AOCI other than FCTA.
Operating return on allocated equity is defined as operating earnings available to common shareholders divided by allocated equity.
Operating return on allocated tangible equity is defined as operating earnings available to common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by allocated tangible equity.
Return on allocated equity is defined as net income (loss) available to MetLife, Inc.s common shareholders divided by allocated equity.
Return on allocated tangible equity is defined as net income (loss) available to MetLife, Inc.s common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by allocated tangible equity.
We sometimes refer to sales activity for various products. These sales statistics do not correspond to revenues under GAAP, but are used as relevant measures of business activity. Statistical sales information for life insurance is calculated by MetLife using the LIMRA definition of sales for core direct sales, excluding company-sponsored internal exchanges, corporate-owned life insurance, bank-owned life insurance, and private placement variable universal life insurance. Individual annuities sales consists of statutory premiums direct and assumed, excluding company sponsored internal exchanges. Statistical sales information for Latin America, Asia and EMEA is calculated using 10% of single-premium deposits (mainly from retirement products such as variable annuity, fixed annuity and pensions), 20% of single-premium deposits from credit insurance and 100% of annualized full-year premiums and fees from recurring-premium policy sales of all products (mainly from risk and protection products such as individual life, accident and health and group).
All comparisons on a constant currency basis reflect the impact of changes in foreign currency exchange rates and are calculated using the average foreign currency exchange rates for the current period and are applied to each of the comparable periods.
Asymmetrical and non-economic accounting refer to: (i) the portion of net derivative gains (losses) on embedded derivatives attributable to the inclusion of MetLifes credit spreads in the liability valuations, (ii) hedging activity that generates net derivative gains (losses) and creates fluctuations in net income because hedge accounting cannot be achieved and the item being hedged does not a have an offsetting gain or loss recognized in earnings, (iii) inflation-indexed benefit adjustments associated with contracts backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass through adjustments, and (iv) impact of changes in foreign currency exchange rates on the re-measurement of foreign denominated unhedged funding agreements and financing transactions to the U.S. dollar and the re-measurement of certain liabilities from non-functional currencies to functional currencies.
Operating expense ratio is calculated by dividing operating expenses (other expenses, net of capitalization of DAC) by operating premiums, fees and other revenues.
Forward-Looking Statements
This news release may contain or incorporate by reference information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give expectations or forecasts of future events. These statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words such as anticipate, estimate, expect, project, intend, plan, believe and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in operations and financial results.
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Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining the actual future results of MetLife, Inc., its subsidiaries and affiliates. These statements are based on current expectations and the current economic environment. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements. Risks, uncertainties, and other factors that might cause such differences include the risks, uncertainties and other factors identified in MetLife, Inc.s filings with the U.S. Securities and Exchange Commission (the SEC). These factors include: (1) difficult conditions in the global capital markets; (2) increased volatility and disruption of the capital and credit markets, which may affect our ability to meet liquidity needs and access capital, including through our credit facilities, generate fee income and market-related revenue and finance statutory reserve requirements and may require us to pledge collateral or make payments related to declines in value of specified assets, including assets supporting risks ceded to certain of our captive reinsurers or hedging arrangements associated with those risks; (3) exposure to financial and capital market risks, including as a result of the disruption in Europe and possible withdrawal of one or more countries from the Euro zone; (4) impact of comprehensive financial services regulation reform on us, as a non-bank systemically important financial institution, or otherwise; (5) numerous rulemaking initiatives required or permitted by the Dodd-Frank Wall Street Reform and Consumer Protection Act which may impact how we conduct our business, including those compelling the liquidation of certain financial institutions; (6) regulatory, legislative or tax changes relating to our insurance, international, or other operations that may affect the cost of, or demand for, our products or services, or increase the cost or administrative burdens of providing benefits to employees; (7) adverse results or other consequences from litigation, arbitration or regulatory investigations; (8) potential liquidity and other risks resulting from our participation in a securities lending program and other transactions; (9) investment losses and defaults, and changes to investment valuations; (10) changes in assumptions related to investment valuations, deferred policy acquisition costs, deferred sales inducements, value of business acquired or goodwill; (11) impairments of goodwill and realized losses or market value impairments to illiquid assets; (12) defaults on our mortgage loans; (13) the defaults or deteriorating credit of other financial institutions that could adversely affect us; (14) economic, political, legal, currency and other risks relating to our international operations, including with respect to fluctuations of exchange rates; (15) downgrades in our claims paying ability, financial strength or credit ratings; (16) a deterioration in the experience of the closed block established in connection with the reorganization of Metropolitan Life Insurance Company; (17) availability and effectiveness of reinsurance or indemnification arrangements, as well as any default or failure of counterparties to perform; (18) differences between actual claims experience and underwriting and reserving assumptions; (19) ineffectiveness of risk management policies and procedures; (20) catastrophe losses; (21) increasing cost and limited market capacity for statutory life insurance reserve financings; (22) heightened competition, including with respect to pricing, entry of new competitors, consolidation of distributors, the development of new products by new and existing competitors, and for personnel; (23) exposure to losses related to variable annuity guarantee benefits, including from significant and sustained downturns or extreme volatility in equity markets, reduced interest rates, unanticipated policyholder behavior, mortality or longevity, and the adjustment for nonperformance risk; (24) our ability to address difficulties, unforeseen liabilities, asset impairments, or rating agency actions arising from business acquisitions, including our acquisition of American Life Insurance Company and Delaware American Life Insurance Company, and integrating and managing the growth of such acquired businesses, or arising from dispositions of businesses or legal entity reorganizations; (25) regulatory and other restrictions affecting MetLife, Inc.s ability to pay dividends and repurchase common stock; (26) MetLife, Inc.s primary reliance, as a holding company, on dividends from its subsidiaries to meet debt payment obligations and the applicable regulatory restrictions on the ability of the subsidiaries to pay such dividends; (27) the possibility that MetLife, Inc.s Board of Directors may influence the outcome of stockholder votes through the voting provisions of the MetLife Policyholder Trust; (28) changes in accounting standards, practices and/or policies; (29) increased expenses relating to pension and postretirement benefit plans, as well as health care and other employee benefits; (30) inability to protect our intellectual property rights or claims of infringement of the intellectual property rights of others; (31) inability to attract and retain sales representatives; (32) provisions of laws and our incorporation documents may delay, deter or prevent takeovers and corporate combinations involving MetLife; (33) the effects of business disruption or economic contraction due to disasters such as terrorist attacks, cyberattacks, other hostilities, or natural catastrophes, including any related impact on the value of our investment portfolio, our disaster recovery systems, cyber- or other information security systems and management continuity planning; (34) the effectiveness of our programs and practices in avoiding giving our associates incentives to take excessive risks; and (35) other risks and uncertainties described from time to time in MetLife, Inc.s filings with the SEC.
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MetLife, Inc. does not undertake any obligation to publicly correct or update any forward-looking statement if MetLife, Inc. later becomes aware that such statement is not likely to be achieved. Please consult any further disclosures MetLife, Inc. makes on related subjects in reports to the SEC.
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MetLife, Inc.
Consolidated Statements of Operating Earnings Available to Common Shareholders
(Unaudited)
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
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2015 | 2014 | 2015 | 2014 | |||||||||||||
(In millions) | (In millions) | |||||||||||||||
OPERATING REVENUES |
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Premiums |
$ | 9,313 | $ | 9,853 | $ | 18,566 | $ | 19,070 | ||||||||
Universal life and investment-type product policy fees |
2,335 | 2,360 | 4,629 | 4,683 | ||||||||||||
Net investment income |
5,185 | 5,095 | 10,167 | 10,180 | ||||||||||||
Other revenues |
527 | 493 | 1,030 | 984 | ||||||||||||
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Total operating revenues |
17,360 | 17,801 | 34,392 | 34,917 | ||||||||||||
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OPERATING EXPENSES |
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Policyholder benefits and claims and policyholder dividends |
9,503 | 9,964 | 18,950 | 19,337 | ||||||||||||
Interest credited to policyholder account balances |
1,342 | 1,425 | 2,673 | 2,826 | ||||||||||||
Capitalization of DAC |
(927 | ) | (1,031 | ) | (1,895 | ) | (2,077 | ) | ||||||||
Amortization of DAC and VOBA |
1,001 | 1,025 | 1,954 | 2,075 | ||||||||||||
Amortization of negative VOBA |
(83 | ) | (99 | ) | (173 | ) | (202 | ) | ||||||||
Interest expense on debt |
307 | 299 | 604 | 593 | ||||||||||||
Other expenses |
3,882 | 3,979 | 7,682 | 7,930 | ||||||||||||
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Total operating expenses |
15,025 | 15,562 | 29,795 | 30,482 | ||||||||||||
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Operating earnings before provision for income tax |
2,335 | 2,239 | 4,597 | 4,435 | ||||||||||||
Provision for income tax expense (benefit) |
539 | 618 | 1,133 | 1,222 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Operating earnings |
1,796 | 1,621 | 3,464 | 3,213 | ||||||||||||
Preferred stock dividends |
31 | 31 | 61 | 61 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS |
$ | 1,765 | $ | 1,590 | $ | 3,403 | $ | 3,152 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Reconciliation to Net Income (Loss) and Financial Statement Line Item Adjustments from GAAP |
||||||||||||||||
Operating earnings |
$ | 1,796 | $ | 1,621 | $ | 3,464 | $ | 3,213 | ||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||
Net investment gains (losses) (1), (2) |
(133 | ) | (125 | ) | 153 | (536 | ) | |||||||||
Net derivative gains (losses) (2) |
(912 | ) | 311 | (91 | ) | 654 | ||||||||||
Premiums |
(1 | ) | 20 | (1 | ) | 22 | ||||||||||
Universal life and investment-type product policy fees |
99 | 98 | 199 | 196 | ||||||||||||
Net investment income |
(238 | ) | 164 | 241 | 114 | |||||||||||
Other revenues |
(9 | ) | (3 | ) | (17 | ) | (16 | ) | ||||||||
Policyholder benefits and claims and policyholder dividends (2) |
(180 | ) | (421 | ) | (329 | ) | (675 | ) | ||||||||
Interest credited to policyholder account balances |
44 | (284 | ) | (620 | ) | (352 | ) | |||||||||
Capitalization of DAC |
| 1 | | 1 | ||||||||||||
Amortization of DAC and VOBA (2) |
104 | (37 | ) | 32 | (45 | ) | ||||||||||
Amortization of negative VOBA |
9 | 12 | 19 | 24 | ||||||||||||
Interest expense on debt |
(1 | ) | (13 | ) | (2 | ) | (31 | ) | ||||||||
Other expenses |
(4 | ) | (12 | ) | (9 | ) | (15 | ) | ||||||||
Goodwill impairment |
| | | | ||||||||||||
Provision for income tax (expense) benefit (2) |
545 | 44 | 243 | 164 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from continuing operations, net of income tax |
1,119 | 1,376 | 3,282 | 2,718 | ||||||||||||
Income (loss) from discontinued operations, net of income tax |
| | | (3 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) |
1,119 | 1,376 | 3,282 | 2,715 | ||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
4 | 10 | 9 | 21 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) attributable to MetLife, Inc. |
1,115 | 1,366 | 3,273 | 2,694 | ||||||||||||
Less: Preferred stock dividends |
31 | 31 | 61 | 61 | ||||||||||||
Less: Preferred stock repurchase premium |
42 | | 42 | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 1,042 | $ | 1,335 | $ | 3,170 | $ | 2,633 | ||||||||
|
|
|
|
|
|
|
|
See footnotes on last page.
MetLife, Inc.
(Unaudited)
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||||||||||||||||
Earnings Per Weighted Average Common Shares Diluted |
Earnings Per Weighted Average Common Shares Diluted |
Earnings Per Weighted Average Common Shares Diluted |
Earnings Per Weighted Average Common Shares Diluted |
|||||||||||||||||||||||||||||
(In millions, except per share data) | (In millions, except per share data) | |||||||||||||||||||||||||||||||
Reconciliation to Net Income (Loss) Available to MetLife, Inc.s Common Shareholders |
||||||||||||||||||||||||||||||||
Operating earnings available to common shareholders |
$ | 1,765 | $ | 1.56 | $ | 1,590 | $ | 1.39 | $ | 3,403 | $ | 3.01 | $ | 3,152 | $ | 2.76 | ||||||||||||||||
Adjustments from operating earnings available to common shareholders to net income (loss) available to MetLife, Inc.s common shareholders: |
||||||||||||||||||||||||||||||||
Add: Net investment gains (losses) (1) |
(133 | ) | (0.12 | ) | (125 | ) | (0.11 | ) | 153 | 0.14 | (536 | ) | (0.47 | ) | ||||||||||||||||||
Add: Net derivative gains (losses) |
(912 | ) | (0.81 | ) | 311 | 0.27 | (91 | ) | (0.08 | ) | 654 | 0.57 | ||||||||||||||||||||
Add: Goodwill impairment |
| | | | | | | | ||||||||||||||||||||||||
Add: Other adjustments to continuing operations |
(177 | ) | (0.15 | ) | (475 | ) | (0.41 | ) | (487 | ) | (0.43 | ) | (777 | ) | (0.67 | ) | ||||||||||||||||
Add: Provision for income tax (expense) benefit |
545 | 0.48 | 44 | 0.04 | 243 | 0.21 | 164 | 0.14 | ||||||||||||||||||||||||
Add: Income (loss) from discontinued operations, net of income tax |
| | | | | | (3 | ) | | |||||||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
4 | | 10 | 0.01 | 9 | 0.01 | 21 | 0.02 | ||||||||||||||||||||||||
Less: Preferred stock repurchase premium |
42 | 0.04 | | | 42 | 0.04 | | | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 1,042 | $ | 0.92 | $ | 1,335 | $ | 1.17 | $ | 3,170 | $ | 2.80 | $ | 2,633 | $ | 2.31 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Weighted average common shares outstanding - diluted |
1128.4 | 1142.3 | 1131.1 | 1140.8 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(In millions) | (In millions) | |||||||||||||||
Reconciliation to GAAP Premiums, Fees and Other Revenues |
||||||||||||||||
Total operating premiums, fees and other revenues |
$ | 12,175 | $ | 12,706 | $ | 24,225 | $ | 24,737 | ||||||||
Add: Adjustments to premiums, fees and other revenues |
89 | 115 | 181 | 202 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total premiums, fees and other revenues |
$ | 12,264 | $ | 12,821 | $ | 24,406 | $ | 24,939 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Reconciliation to GAAP Revenues and GAAP Expenses |
||||||||||||||||
Total operating revenues |
$ | 17,360 | $ | 17,801 | $ | 34,392 | $ | 34,917 | ||||||||
Add: Net investment gains (losses) (1) |
(133 | ) | (125 | ) | 153 | (536 | ) | |||||||||
Add: Net derivative gains (losses) |
(912 | ) | 311 | (91 | ) | 654 | ||||||||||
Add: Adjustments related to net investment gains (losses) and net derivative gains (losses) |
3 | 3 | 7 | 6 | ||||||||||||
Add: Other adjustments to revenues |
(152 | ) | 276 | 415 | 310 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenues |
$ | 16,166 | $ | 18,266 | $ | 34,876 | $ | 35,351 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Total operating expenses |
$ | 15,025 | $ | 15,562 | $ | 29,795 | $ | 30,482 | ||||||||
Add: Adjustments related to net investment gains (losses) and net derivative gains (losses) |
(94 | ) | 63 | 1 | 64 | |||||||||||
Add: Goodwill impairment |
| | | | ||||||||||||
Add: Other adjustments to expenses |
122 | 691 | 908 | 1,029 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total expenses |
$ | 15,053 | $ | 16,316 | $ | 30,704 | $ | 31,575 | ||||||||
|
|
|
|
|
|
|
|
See footnotes on last page.
MetLife, Inc.
(Unaudited)
June 30, | ||||||||
Book Value (3) |
2015 | 2014 | ||||||
Book value per common share |
$ | 60.27 | $ | 59.96 | ||||
Less: Net unrealized investment gains (losses), net of income tax |
11.52 | 12.77 | ||||||
Less: Defined benefit plans adjustment, net of income tax |
(1.98 | ) | (1.41 | ) | ||||
|
|
|
|
|||||
Book value per common share, excluding AOCI other than FCTA |
$ | 50.73 | $ | 48.60 | ||||
Less: Goodwill, net of income tax |
8.51 | 9.19 | ||||||
Less: VODA and VOCRA, net of income tax |
0.49 | 0.72 | ||||||
|
|
|
|
|||||
Book value per common share - tangible common stockholders equity (excludes AOCI other than FCTA) |
$ | 41.73 | $ | 38.69 | ||||
|
|
|
|
|||||
Common shares outstanding, end of period (In millions) |
1,116.8 | 1,126.6 |
For the Three Months Ended June 30, |
For the Year Ended December 31, |
|||||||||||
Return on Equity (4) |
2015 | 2014 | 2014 | |||||||||
Operating return on MetLife, Inc.s: |
||||||||||||
Common stockholders equity |
10.2 | % | 9.7 | % | 10.0 | % | ||||||
Common stockholders equity, excluding AOCI other than FCTA |
12.5 | % | 11.7 | % | 12.0 | % | ||||||
Tangible common stockholders equity (excludes AOCI other than FCTA) |
15.3 | % | 14.9 | % | 15.2 | % | ||||||
Return on MetLife, Inc.s: |
||||||||||||
Common stockholders equity |
6.0 | % | 8.1 | % | 9.4 | % | ||||||
Common stockholders equity, excluding AOCI other than FCTA |
7.4 | % | 9.9 | % | 11.3 | % | ||||||
Tangible common stockholders equity (excludes AOCI other than FCTA) |
9.1 | % | 12.5 | % | 14.3 | % | ||||||
Operating return on allocated equity: |
||||||||||||
Americas |
14.8 | % | 14.8 | % | ||||||||
Asia |
14.8 | % | 11.1 | % | ||||||||
EMEA |
6.0 | % | 8.3 | % | ||||||||
Operating return on allocated tangible equity: |
||||||||||||
Americas |
16.6 | % | 16.9 | % | ||||||||
Asia |
25.4 | % | 19.2 | % | ||||||||
EMEA |
11.2 | % | 16.1 | % | ||||||||
Return on allocated equity: |
||||||||||||
Americas |
10.4 | % | 12.8 | % | ||||||||
Asia |
19.6 | % | 11.4 | % | ||||||||
EMEA |
7.7 | % | 13.2 | % | ||||||||
Return on Allocated Tangible Equity: |
||||||||||||
Americas |
11.7 | % | 14.6 | % | ||||||||
Asia |
33.7 | % | 19.7 | % | ||||||||
EMEA |
14.2 | % | 25.2 | % |
See footnotes on last page.
MetLife, Inc.
Reconciliations to Net Income (Loss) Available to Common Shareholders
(Unaudited)
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(In millions) | (In millions) | |||||||||||||||
Total Americas Operations: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | 1,443 | $ | 1,385 | $ | 2,824 | $ | 2,709 | ||||||||
Add: Net investment gains (losses) (1) |
(14 | ) | (189 | ) | 260 | (706 | ) | |||||||||
Add: Net derivative gains (losses) |
(508 | ) | 429 | 69 | 715 | |||||||||||
Add: Other adjustments to continuing operations |
(124 | ) | (484 | ) | (392 | ) | (759 | ) | ||||||||
Add: Provision for income tax (expense) benefit |
221 | 62 | 16 | 231 | ||||||||||||
Add: Income (loss) from discontinued operations, net of income tax |
| | | (3 | ) | |||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
3 | 4 | 6 | 9 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 1,015 | $ | 1,199 | $ | 2,771 | $ | 2,178 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Retail: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | 690 | $ | 677 | $ | 1,343 | $ | 1,313 | ||||||||
Add: Net investment gains (losses) |
9 | 10 | 77 | 16 | ||||||||||||
Add: Net derivative gains (losses) |
(95 | ) | 225 | 218 | 296 | |||||||||||
Add: Other adjustments to continuing operations |
(72 | ) | (274 | ) | (264 | ) | (421 | ) | ||||||||
Add: Provision for income tax (expense) benefit |
55 | 14 | (11 | ) | 39 | |||||||||||
Add: Income (loss) from discontinued operations, net of income tax |
| | | (2 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 587 | $ | 652 | $ | 1,363 | $ | 1,241 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Group, Voluntary & Worksite Benefits: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | 231 | $ | 209 | $ | 459 | $ | 399 | ||||||||
Add: Net investment gains (losses) |
8 | 10 | 11 | (1 | ) | |||||||||||
Add: Net derivative gains (losses) |
(264 | ) | 71 | (59 | ) | 187 | ||||||||||
Add: Other adjustments to continuing operations |
(41 | ) | (42 | ) | (83 | ) | (81 | ) | ||||||||
Add: Provision for income tax (expense) benefit |
104 | (14 | ) | 46 | (37 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 38 | $ | 234 | $ | 374 | $ | 467 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Corporate Benefit Funding: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | 406 | $ | 363 | $ | 775 | $ | 703 | ||||||||
Add: Net investment gains (losses) |
(31 | ) | (195 | ) | 174 | (736 | ) | |||||||||
Add: Net derivative gains (losses) (1) |
(134 | ) | 125 | (54 | ) | 228 | ||||||||||
Add: Other adjustments to continuing operations |
13 | (22 | ) | (26 | ) | (24 | ) | |||||||||
Add: Provision for income tax (expense) benefit |
53 | 24 | (33 | ) | 172 | |||||||||||
Add: Income (loss) from discontinued operations, net of income tax |
| | | (1 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 307 | $ | 295 | $ | 836 | $ | 342 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Latin America: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | 116 | $ | 136 | $ | 247 | $ | 294 | ||||||||
Add: Net investment gains (losses) |
| (14 | ) | (2 | ) | 15 | ||||||||||
Add: Net derivative gains (losses) |
(15 | ) | 8 | (36 | ) | 4 | ||||||||||
Add: Other adjustments to continuing operations |
(24 | ) | (146 | ) | (19 | ) | (233 | ) | ||||||||
Add: Provision for income tax (expense) benefit |
9 | 38 | 14 | 57 | ||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
3 | 4 | 6 | 9 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 83 | $ | 18 | $ | 198 | $ | 128 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Asia: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | 425 | $ | 324 | $ | 752 | $ | 657 | ||||||||
Add: Net investment gains (losses) |
57 | 82 | 125 | 239 | ||||||||||||
Add: Net derivative gains (losses) |
9 | (35 | ) | 27 | (42 | ) | ||||||||||
Add: Other adjustments to continuing operations |
(37 | ) | (6 | ) | (92 | ) | (18 | ) | ||||||||
Add: Provision for income tax (expense) benefit |
111 | (27 | ) | 101 | (68 | ) | ||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
1 | 4 | 1 | 10 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 564 | $ | 334 | $ | 912 | $ | 758 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
EMEA: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | 50 | $ | 72 | $ | 120 | $ | 143 | ||||||||
Add: Net investment gains (losses) |
5 | 2 | 8 | (7 | ) | |||||||||||
Add: Net derivative gains (losses) |
13 | 49 | 14 | 87 | ||||||||||||
Add: Other adjustments to continuing operations |
(12 | ) | 31 | 7 | 30 | |||||||||||
Add: Provision for income tax (expense) benefit |
7 | (38 | ) | (19 | ) | (51 | ) | |||||||||
Less: Net income (loss) attributable to noncontrolling interests |
(1 | ) | 1 | 1 | 1 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 64 | $ | 115 | $ | 129 | $ | 201 | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Corporate & Other: |
||||||||||||||||
Operating earnings available to common shareholders |
$ | (153 | ) | $ | (191 | ) | $ | (293 | ) | $ | (357 | ) | ||||
Add: Net investment gains (losses) |
(181 | ) | (20 | ) | (240 | ) | (62 | ) | ||||||||
Add: Net derivative gains (losses) |
(426 | ) | (132 | ) | (201 | ) | (106 | ) | ||||||||
Add: Other adjustments to continuing operations |
(4 | ) | (16 | ) | (10 | ) | (30 | ) | ||||||||
Add: Provision for income tax (expense) benefit |
206 | 47 | 145 | 52 | ||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
1 | 1 | 1 | 1 | ||||||||||||
Less: Preferred stock repurchase premium |
42 | | 42 | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | (601 | ) | $ | (313 | ) | $ | (642 | ) | $ | (504 | ) | ||||
|
|
|
|
|
|
|
|
See footnotes on last page.
MetLife, Inc.
GAAP Interim Condensed Consolidated Statements of Operations
(Unaudited)
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
(In millions) | (In millions) | |||||||||||||||
Revenues |
||||||||||||||||
Premiums |
$ | 9,312 | $ | 9,873 | $ | 18,565 | $ | 19,092 | ||||||||
Universal life and investment-type product policy fees |
2,434 | 2,458 | 4,828 | 4,879 | ||||||||||||
Net investment income |
4,947 | 5,259 | 10,408 | 10,294 | ||||||||||||
Other revenues |
518 | 490 | 1,013 | 968 | ||||||||||||
Net investment gains (losses): |
||||||||||||||||
Other-than-temporary impairments on fixed maturity securities |
| (9 | ) | (8 | ) | (23 | ) | |||||||||
Other-than-temporary impairments on fixed maturity securities transferred to other comprehensive income (loss) |
(2 | ) | (6 | ) | (12 | ) | (2 | ) | ||||||||
Other net investment gains (losses) (1) |
(131 | ) | (110 | ) | 173 | (511 | ) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Total net investment gains (losses) |
(133 | ) | (125 | ) | 153 | (536 | ) | |||||||||
Net derivative gains (losses) |
(912 | ) | 311 | (91 | ) | 654 | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total revenues |
16,166 | 18,266 | 34,876 | 35,351 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Expenses |
||||||||||||||||
Policyholder benefits and claims |
9,352 | 9,988 | 18,609 | 19,312 | ||||||||||||
Interest credited to policyholder account balances |
1,298 | 1,709 | 3,293 | 3,178 | ||||||||||||
Policyholder dividends |
331 | 397 | 670 | 700 | ||||||||||||
Other expenses |
4,072 | 4,222 | 8,132 | 8,385 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total expenses |
15,053 | 16,316 | 30,704 | 31,575 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from continuing operations before provision for income tax |
1,113 | 1,950 | 4,172 | 3,776 | ||||||||||||
Provision for income tax expense (benefit) |
(6 | ) | 574 | 890 | 1,058 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from continuing operations, net of income tax |
1,119 | 1,376 | 3,282 | 2,718 | ||||||||||||
Income (loss) from discontinued operations, net of income tax |
| | | (3 | ) | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) |
1,119 | 1,376 | 3,282 | 2,715 | ||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
4 | 10 | 9 | 21 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) attributable to MetLife, Inc. |
1,115 | 1,366 | 3,273 | 2,694 | ||||||||||||
Less: Preferred stock dividends |
31 | 31 | 61 | 61 | ||||||||||||
Preferred stock repurchase premium |
42 | | 42 | | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 1,042 | $ | 1,335 | $ | 3,170 | $ | 2,633 | ||||||||
|
|
|
|
|
|
|
|
(1) | The three months and six months ended June 30, 2014 include a pre-tax net investment loss of $138 million and $633 million, respectively, related to the sale of MetLife, Inc.s wholly-owned subsidiary, MetLife Assurance Limited. |
(2) | The impacts of asymmetrical and non-economic accounting for the three months ended June 30, 2015 are as follows: i) Net investment gains (losses) - ($199) million; ii) Net derivative gains (losses) - ($1,192) million; iii) Policyholder benefits and claims and policyholder dividends - $25 million; iv) Amortization of DAC and VOBA - $48 million; and v) Provision for income tax (expense) benefit - $462 million. |
(3) | Book values exclude $2,066 million and $2,043 million of equity related to preferred stock at June 30, 2015 and 2014, respectively. |
(4) | Annualized using quarter-to-date results. |
Exhibit 99.2
Second Quarter
Financial Supplement
June 30, 2015
1
METLIFE
As used in this Quarterly Financial Supplement (QFS), MetLife, we and our refer to MetLife, Inc., a Delaware corporation incorporated in 1999, its subsidiaries and affiliates.
This QFS includes certain operating and statistical measures, such as sales and product spreads, among others, to provide supplemental data regarding the performance of our current business. Operating earnings is the measure of segment profit or loss we use to evaluate segment performance and allocate resources. Consistent with accounting principles generally accepted in the United States of America (GAAP) accounting guidance for segment reporting, operating earnings is our measure of segment performance. Operating earnings is also a measure by which senior managements and many other employees performance is evaluated for the purposes of determining their compensation under applicable compensation plans.
Operating earnings is defined as operating revenues less operating expenses, both net of income tax. Operating earnings available to common shareholders is defined as operating earnings less preferred stock dividends.
Operating revenues and operating expenses exclude results of discontinued operations and other businesses that have been or will be sold or exited by MetLife (Divested businesses). Operating revenues also excludes net investment gains (losses) (NIGL) and net derivative gains (losses) (NDGL). Operating expenses also excludes goodwill impairments.
The following additional adjustments are made to GAAP revenues, in the line items indicated, in calculating operating revenues: | ||
|
Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to NIGL and NDGL (Unearned revenue adjustments) and certain variable annuity guaranteed minimum income benefits (GMIB) fees (GMIB fees); | |
|
Net investment income: (i) includes amounts for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment (Investment hedge adjustments), (ii) includes income from discontinued real estate operations, (iii) excludes post-tax operating earnings adjustments relating to insurance joint ventures accounted for under the equity method (Operating joint venture adjustments), (iv) excludes certain amounts related to contractholder-directed unit-linked investments (Unit-linked contract income), and (v) excludes certain amounts related to securitization entities that are variable interest entities (VIEs) consolidated under GAAP (Securitization entities income); and | |
|
Other revenues are adjusted for settlements of foreign currency earnings hedges. | |
The following additional adjustments are made to GAAP expenses, in the line items indicated, in calculating operating expenses: | ||
|
Policyholder benefits and claims and policyholder dividends excludes: (i) changes in the policyholder dividend obligation related to NIGL and NDGL (PDO adjustments), (ii) inflation-indexed benefit adjustments associated with contracts backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass through adjustments (Inflation adjustments and pass through adjustments), (iii) benefits and hedging costs related to GMIBs (GMIB costs), and (iv) market value adjustments associated with surrenders or terminations of contracts (Market value adjustments); | |
|
Interest credited to policyholder account balances includes adjustments for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of policyholder account balances but do not qualify for hedge accounting treatment (PAB hedge adjustments) and excludes amounts related to net investment income earned on contractholder-directed unit-linked investments (Unit-linked contract costs); | |
|
Amortization of deferred policy acquisition costs (DAC) and value of business acquired (VOBA) excludes amounts related to: (i) NIGL and NDGL, (ii) GMIB fees and GMIB costs, and (iii) Market value adjustments; | |
|
Amortization of negative VOBA excludes amounts related to Market value adjustments; | |
|
Interest expense on debt excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP (Securitization entities debt expense); and | |
|
Other expenses excludes costs related to: (i) noncontrolling interests, (ii) implementation of new insurance regulatory requirements (Regulatory implementation costs), and (iii) acquisition and integration costs. | |
Operating earnings also excludes the recognition of certain contingent assets and liabilities that could not be recognized at acquisition or adjusted for during the measurement period under GAAP business combination accounting guidance. In addition to the tax impact of the adjustments mentioned above, provision for income tax (expense) benefit also includes the impact related to the timing of certain tax credits, as well as certain tax reforms.
MetLife, Inc.s tangible common stockholders equity is defined as MetLife, Inc.s common stockholders equity, excluding the net unrealized investment gains (losses) and defined benefit plans adjustment components of accumulated other comprehensive income (loss) (AOCI) and is also reduced by the impact of goodwill, value of distribution agreements (VODA) and value of customer relationships acquired (VOCRA), all net of income tax. MetLife, Inc.s common stockholders equity, excluding AOCI other than foreign currency translation adjustments (FCTA), is defined as MetLife, Inc.s common stockholders equity, excluding the net unrealized investment gains (losses) and defined benefit plans adjustment components of AOCI, net of income tax.
We believe the presentation of operating earnings and operating earnings available to common shareholders as we measure it for management purposes enhances the understanding of our performance by highlighting the results of operations and the underlying profitability drivers of our business. Operating revenues, operating expenses, operating earnings, operating earnings available to common shareholders, operating earnings available to common shareholders per diluted common share, investment portfolio gains (losses) and derivative gains (losses) should not be viewed as substitutes for the following financial measures calculated in accordance with GAAP: GAAP revenues, GAAP expenses, income (loss) from continuing operations, net of income tax, net income (loss) available to MetLife, Inc.s common shareholders, net income (loss) available to MetLife, Inc.s common shareholders per diluted common share, net investment gains (losses) and net derivative gains (losses), respectively. MetLife, Inc.s tangible common stockholders equity and MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA, should not be viewed as substitutes for total MetLife, Inc.s stockholders equity calculated in accordance with GAAP. Reconciliations of these measures to the most directly comparable GAAP measures are included in this QFS, including in the Appendix, and in our earnings news release dated July 29, 2015, for the period ended June 30, 2015, which is available at www.metlife.com.
In addition, the following are return on equity and allocated equity definitions: | ||
|
Operating return on MetLife, Inc.s tangible common stockholders equity - operating earnings available to common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by MetLife, Inc.s average tangible common stockholders equity. | |
|
Operating return on MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA - operating earnings available to common shareholders divided by MetLife, Inc.s average common stockholders equity, excluding AOCI other than FCTA. | |
|
Operating return on MetLife, Inc.s common stockholders equity - operating earnings available to common shareholders divided by MetLife, Inc.s average common stockholders equity. | |
|
Operating return on allocated equity - operating earnings available to common shareholders divided by allocated equity. | |
|
Operating return on allocated tangible equity - operating earnings available to common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by allocated tangible equity. | |
|
Return on MetLife, Inc.s tangible common stockholders equity - net income (loss) available to MetLife, Inc.s common shareholders, excluding goodwill impairment and amortization of VODA and VOCRA, net of income tax, divided by MetLife, Inc.s average tangible common stockholders equity. | |
|
Return on MetLife, Inc.s common stockholders equity, excluding AOCI other than FCTA - net income (loss) available to MetLife, Inc.s common shareholders divided by MetLife, Inc.s average common stockholders equity, excluding AOCI other than FCTA. | |
|
Return on MetLife, Inc.s common stockholders equity - net income (loss) available to MetLife, Inc.s common shareholders divided by MetLife, Inc.s average common stockholders equity. | |
|
Return on allocated equity - net income (loss) available to MetLife, Inc.s common shareholders divided by allocated equity. | |
|
Return on allocated tangible equity - net income (loss) available to MetLife, Inc.s common shareholders, excluding amortization of VODA and VOCRA, net of income tax, divided by allocated tangible equity. | |
Please see Page 11 for information on allocated equity. |
2
METLIFE
|
||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited (In millions, except per share data) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Operating earnings available to common shareholders |
$ | 1,590 | $ | 1,825 | $ | 1,583 | $ | 1,638 | $ | 1,765 | ||||||||||
Preferred stock dividends |
31 | 30 | 31 | 30 | 31 | |||||||||||||||
Operating earnings |
1,621 | 1,855 | 1,614 | 1,668 | 1,796 | |||||||||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||||||
Net investment gains (losses) (1) |
(125 | ) | 109 | 230 | 286 | (133 | ) | |||||||||||||
Net derivative gains (losses) |
311 | 478 | 185 | 821 | (912 | ) | ||||||||||||||
Goodwill impairment |
- | - | - | - | - | |||||||||||||||
Other adjustments to continuing operations |
(475 | ) | (146 | ) | (453 | ) | (310 | ) | (177 | ) | ||||||||||
Provision for income tax (expense) benefit |
44 | (202 | ) | (49 | ) | (302 | ) | 545 | ||||||||||||
Income (loss) from continuing operations, net of income tax |
1,376 | 2,094 | 1,527 | 2,163 | 1,119 | |||||||||||||||
Income (loss) from discontinued operations, net of income tax |
- | - | - | - | - | |||||||||||||||
Net income (loss) |
1,376 | 2,094 | 1,527 | 2,163 | 1,119 | |||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
10 | - | 6 | 5 | 4 | |||||||||||||||
Net income (loss) attributable to MetLife, Inc. |
1,366 | 2,094 | 1,521 | 2,158 | 1,115 | |||||||||||||||
Less: Preferred stock dividends |
31 | 30 | 31 | 30 | 31 | |||||||||||||||
Less: Preferred stock repurchase premium |
- | - | - | - | 42 | |||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 1,335 | $ | 2,064 | $ | 1,490 | $ | 2,128 | $ | 1,042 | ||||||||||
Operating earnings available to common shareholders per common share - diluted |
$ | 1.39 | $ | 1.60 | $ | 1.38 | $ | 1.44 | $ | 1.56 | ||||||||||
Net investment gains (losses) |
(0.11 | ) | 0.10 | 0.20 | 0.25 | (0.12 | ) | |||||||||||||
Net derivative gains (losses) |
0.27 | 0.42 | 0.16 | 0.72 | (0.81 | ) | ||||||||||||||
Goodwill impairment |
- | - | - | - | - | |||||||||||||||
Other adjustments to continuing operations |
(0.41 | ) | (0.13 | ) | (0.39 | ) | (0.27 | ) | (0.15 | ) | ||||||||||
Provision for income tax (expense) benefit |
0.04 | (0.18 | ) | (0.04 | ) | (0.27 | ) | 0.48 | ||||||||||||
Discontinued operations, net of income tax |
- | - | - | - | - | |||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
0.01 | - | 0.01 | - | - | |||||||||||||||
Less: Preferred stock repurchase premium |
- | - | - | - | 0.04 | |||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders per common share - diluted |
$ | 1.17 | $ | 1.81 | $ | 1.30 | $ | 1.87 | $ | 0.92 | ||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited (In millions, except per share data) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Notable items impacting operating earnings available to common shareholders: |
||||||||||||||||||||
Variable investment income, as compared to plan |
$ | 11 | $ | 62 | $ | - | $ | - | $ | - | ||||||||||
Catastrophe experience and prior year development, net |
(21 | ) | 38 | 16 | (16 | ) | - | |||||||||||||
Actuarial assumption review and other insurance adjustments |
56 | 16 | 5 | - | - | |||||||||||||||
Litigation reserves & settlement costs |
- | - | (117 | ) | - | - | ||||||||||||||
Tax adjustments |
- | (9 | ) | 27 | - | 61 | ||||||||||||||
Total notable items (2) |
$ | 46 | $ | 107 | $ | (69 | ) | $ | (16 | ) | $ | 61 | ||||||||
Notable items impacting operating earnings available to common shareholders per common share - diluted: |
||||||||||||||||||||
Variable investment income, as compared to plan |
$ | 0.01 | $ | 0.05 | $ | - | $ | - | $ | - | ||||||||||
Catastrophe experience and prior year development, net |
$ | (0.02 | ) | $ | 0.03 | $ | 0.01 | $ | (0.01 | ) | $ | - | ||||||||
Actuarial assumption review and other insurance adjustments |
$ | 0.05 | $ | 0.01 | $ | - | $ | - | $ | - | ||||||||||
Litigation reserves & settlement costs |
$ | - | $ | - | $ | (0.10 | ) | $ | - | $ | - | |||||||||
Tax adjustments |
$ | - | $ | (0.01 | ) | $ | 0.02 | $ | - | $ | 0.05 | |||||||||
Total notable items (2) |
$ | 0.04 | $ | 0.09 | $ | (0.06 | ) | $ | (0.01 | ) | $ | 0.05 | ||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Weighted average common shares outstanding - diluted |
1,142.3 | 1,141.0 | 1,147.3 | 1,135.8 | 1,128.4 | |||||||||||||||
(1) The three months ended June 30, 2014 includes a pre-tax net investment loss of $138 million related to the sale of MetLife, Inc.s wholly-owned subsidiary, MetLife Assurance Limited.
(2) Notable items represent a positive (negative) impact to operating earnings available to common shareholders and operating earnings available to common shareholders per common share - diluted. The per share data for each notable item is calculated on a stand alone basis and may not sum to total notable items. |
|
3
METLIFE CORPORATE OVERVIEW (CONTINUED)
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Unaudited | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Book value per common share, excluding AOCI other than FCTA (1) |
$ | 48.60 | $ | 49.69 | $ | 49.53 | $ | 50.45 | $ | 50.73 | ||||||||||
Book value per common share - tangible common stockholders equity (excludes AOCI other than FCTA) (1) |
$ | 38.69 | $ | 39.95 | $ | 40.36 | $ | 41.32 | $ | 41.73 | ||||||||||
Book value per common share (1) |
$ | 59.96 | $ | 61.44 | $ | 61.85 | $ | 64.37 | $ | 60.27 | ||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Operating return on MetLife, Inc.s (2): |
||||||||||||||||||||
Common stockholders equity, excluding AOCI other than FCTA |
11.7% | 13.2% | 11.3% | 11.7% | 12.5% | |||||||||||||||
Tangible common stockholders equity (excludes AOCI other than FCTA) (3) |
14.9% | 16.7% | 14.1% | 14.4% | 15.3% | |||||||||||||||
Common stockholders equity |
9.7% | 10.7% | 9.1% | 9.2% | 10.2% | |||||||||||||||
Return on MetLife, Inc.s (2): |
||||||||||||||||||||
Common stockholders equity, excluding AOCI other than FCTA |
9.9% | 15.0% | 10.7% | 15.2% | 7.4% | |||||||||||||||
Tangible common stockholders equity (excludes AOCI other than FCTA) (3) |
12.5% | 18.8% | 13.3% | 18.7% | 9.1% | |||||||||||||||
Common stockholders equity |
8.1% | 12.1% | 8.6% | 12.0% | 6.0% | |||||||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Common shares outstanding, beginning of period |
1,124.8 | 1,126.6 | 1,119.1 | 1,131.9 | 1,114.3 | |||||||||||||||
Share repurchases (4) |
- | (8.1 | ) | (10.7 | ) | (19.9 | ) | (0.2 | ) | |||||||||||
Newly issued shares |
1.8 | 0.6 | 23.5 | 2.3 | 2.7 | |||||||||||||||
Common shares outstanding, end of period |
1,126.6 | 1,119.1 | 1,131.9 | 1,114.3 | 1,116.8 | |||||||||||||||
Weighted average common shares outstanding - basic |
1,128.0 | 1,125.1 | 1,135.8 | 1,125.7 | 1,117.8 | |||||||||||||||
Dilutive effect of stock purchase contracts underlying common equity units |
3.8 | 4.6 | - | - | - | |||||||||||||||
Dilutive effect of the exercise or issuance of stock-based awards |
10.5 | 11.3 | 11.5 | 10.1 | 10.6 | |||||||||||||||
Weighted average common shares outstanding - diluted |
1,142.3 | 1,141.0 | 1,147.3 | 1,135.8 | 1,128.4 | |||||||||||||||
MetLife Policyholder Trust Shares |
185.7 | 183.6 | 180.5 | 178.3 | 175.0 | |||||||||||||||
(1) Calculated using common shares outstanding, end of period.
(2) Annualized using quarter-to-date results. See page A-4 for the operating return on MetLife, Inc.s common stockholders equity and return on MetLife, Inc.s common stockholders equity for the year ended December 31, 2014.
(3) Operating earnings available to common shareholders and net income available to common shareholders, used to calculate returns on tangible equity, exclude the impact of amortization of VODA and VOCRA, net of income tax.
(4) For the three months ended June 30, 2014, the number of shares repurchased was less than 100,000 shares. |
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4
METLIFE
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Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
ASSETS |
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Investments: |
||||||||||||||||||||
Fixed maturity securities available-for-sale, at estimated fair value |
$ | 367,056 | $ | 368,070 | $ | 365,425 | $ | 366,275 | $ | 351,353 | ||||||||||
Equity securities available-for-sale, at estimated fair value |
3,863 | 3,689 | 3,631 | 3,713 | 3,677 | |||||||||||||||
Fair value option and trading securities, at estimated fair value (1) |
17,831 | 17,246 | 16,689 | 16,471 | 16,460 | |||||||||||||||
Mortgage loans |
57,223 | 58,038 | 60,118 | 62,409 | 64,010 | |||||||||||||||
Policy loans |
11,785 | 11,756 | 11,618 | 11,606 | 11,575 | |||||||||||||||
Real estate and real estate joint ventures |
10,101 | 10,393 | 10,525 | 10,310 | 10,207 | |||||||||||||||
Other limited partnership interests |
7,964 | 8,214 | 8,085 | 8,074 | 8,099 | |||||||||||||||
Short-term investments, principally at estimated fair value |
12,366 | 12,240 | 8,621 | 14,130 | 14,594 | |||||||||||||||
Other invested assets, principally at estimated fair value |
17,116 | 17,905 | 21,283 | 23,763 | 20,409 | |||||||||||||||
Total investments |
505,305 | 507,551 | 505,995 | 516,751 | 500,384 | |||||||||||||||
Cash and cash equivalents, principally at estimated fair value (1) |
7,393 | 8,783 | 10,808 | 8,127 | 8,074 | |||||||||||||||
Accrued investment income |
4,234 | 4,380 | 4,120 | 4,298 | 3,990 | |||||||||||||||
Premiums, reinsurance and other receivables |
23,730 | 23,814 | 22,244 | 24,190 | 24,872 | |||||||||||||||
Deferred policy acquisition costs and value of business acquired |
25,915 | 25,503 | 24,442 | 24,003 | 24,379 | |||||||||||||||
Goodwill |
10,430 | 10,216 | 9,872 | 9,717 | 9,644 | |||||||||||||||
Other assets |
9,136 | 8,900 | 7,862 | 7,980 | 7,589 | |||||||||||||||
Separate account assets |
324,977 | 319,480 | 316,994 | 324,724 | 319,477 | |||||||||||||||
Total assets |
$ | 911,120 | $ | 908,627 | $ | 902,337 | $ | 919,790 | $ | 898,409 | ||||||||||
LIABILITIES AND EQUITY |
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Liabilities |
||||||||||||||||||||
Future policy benefits |
$ | 189,675 | $ | 189,282 | $ | 189,586 | $ | 191,217 | $ | 188,928 | ||||||||||
Policyholder account balances |
213,799 | 215,226 | 209,294 | 206,591 | 204,262 | |||||||||||||||
Other policy-related balances |
15,361 | 15,026 | 14,422 | 14,586 | 14,393 | |||||||||||||||
Policyholder dividends payable |
682 | 710 | 684 | 677 | 699 | |||||||||||||||
Policyholder dividend obligation |
2,986 | 2,825 | 3,155 | 3,483 | 2,328 | |||||||||||||||
Payables for collateral under securities loaned and other transactions |
33,187 | 33,776 | 35,326 | 37,312 | 35,532 | |||||||||||||||
Short-term debt |
100 | 100 | 100 | 100 | 100 | |||||||||||||||
Long-term debt (1) |
16,783 | 16,389 | 16,286 | 17,714 | 16,770 | |||||||||||||||
Collateral financing arrangements |
4,196 | 4,196 | 4,196 | 4,196 | 4,164 | |||||||||||||||
Junior subordinated debt securities |
3,193 | 3,193 | 3,193 | 3,193 | 3,193 | |||||||||||||||
Current income tax payable |
232 | 293 | 184 | 243 | 71 | |||||||||||||||
Deferred income tax liability |
10,453 | 11,357 | 11,821 | 13,305 | 10,762 | |||||||||||||||
Other liabilities |
25,214 | 25,373 | 24,437 | 28,040 | 27,741 | |||||||||||||||
Separate account liabilities |
324,977 | 319,480 | 316,994 | 324,724 | 319,477 | |||||||||||||||
Total liabilities |
840,838 | 837,226 | 829,678 | 845,381 | 828,420 | |||||||||||||||
Redeemable noncontrolling interests in partially-owned consolidated subsidiaries |
108 | 102 | 99 | 95 | 92 | |||||||||||||||
Equity |
||||||||||||||||||||
Preferred stock, at par value |
1 | 1 | 1 | 1 | - | |||||||||||||||
Common stock, at par value |
11 | 11 | 12 | 12 | 12 | |||||||||||||||
Additional paid-in capital |
29,438 | 29,488 | 30,543 | 30,632 | 30,718 | |||||||||||||||
Retained earnings |
29,259 | 30,928 | 32,020 | 33,754 | 34,376 | |||||||||||||||
Treasury stock, at cost |
(176 | ) | (615 | ) | (1,172 | ) | (2,158 | ) | (2,172 | ) | ||||||||||
Accumulated other comprehensive income (loss) |
11,058 | 10,992 | 10,649 | 11,529 | 6,443 | |||||||||||||||
Total MetLife, Inc.s stockholders equity |
69,591 | 70,805 | 72,053 | 73,770 | 69,377 | |||||||||||||||
Noncontrolling interests |
583 | 494 | 507 | 544 | 520 | |||||||||||||||
Total equity |
70,174 | 71,299 | 72,560 | 74,314 | 69,897 | |||||||||||||||
Total liabilities and equity |
$ | 911,120 | $ | 908,627 | $ | 902,337 | $ | 919,790 | $ | 898,409 | ||||||||||
(1) At June 30, 2014, September 30, 2014, December 31, 2014, March 31, 2015 and June 30, 2015, $656 million, $331 million, $295 million, $287 million and $280 million, respectively, of assets and $505 million, $186 million, $151 million, $143 million and $134 million, respectively, of liabilities related to certain securitization entities that are required to be consolidated under GAAP are included. See Pages 31 and 32, note 3, for the amounts by asset category. |
|
5
6
7
METLIFE CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
|
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For the Three Months Ended June 30, 2014 | ||||||||||||||||||||
Unaudited (In millions) | Consolidated | Americas | Asia | EMEA | Corporate & Other | |||||||||||||||
OPERATING REVENUES |
||||||||||||||||||||
Premiums |
$ | 9,853 | $ | 7,334 | $ | 1,913 | $ | 584 | $ | 22 | ||||||||||
Universal life and investment-type product policy fees |
2,360 | 1,809 | 400 | 117 | 34 | |||||||||||||||
Net investment income |
5,095 | 4,126 | 724 | 112 | 133 | |||||||||||||||
Other revenues |
493 | 453 | 24 | 11 | 5 | |||||||||||||||
Total operating revenues |
17,801 | 13,722 | 3,061 | 824 | 194 | |||||||||||||||
OPERATING EXPENSES |
||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
9,964 | 8,249 | 1,425 | 271 | 19 | |||||||||||||||
Interest credited to policyholder account balances |
1,425 | 987 | 394 | 35 | 9 | |||||||||||||||
Capitalization of DAC |
(1,031 | ) | (404 | ) | (457 | ) | (170 | ) | - | |||||||||||
Amortization of DAC and VOBA |
1,025 | 503 | 362 | 160 | - | |||||||||||||||
Amortization of negative VOBA |
(99 | ) | (1 | ) | (92 | ) | (6 | ) | - | |||||||||||
Interest expense on debt |
299 | 2 | - | - | 297 | |||||||||||||||
Other expenses |
3,979 | 2,384 | 977 | 456 | 162 | |||||||||||||||
Total operating expenses |
15,562 | 11,720 | 2,609 | 746 | 487 | |||||||||||||||
Operating earnings before provision for income tax |
2,239 | 2,002 | 452 | 78 | (293 | ) | ||||||||||||||
Provision for income tax expense (benefit) |
618 | 617 | 128 | 6 | (133 | ) | ||||||||||||||
Operating earnings |
1,621 | 1,385 | 324 | 72 | (160 | ) | ||||||||||||||
Preferred stock dividends |
31 | - | - | - | 31 | |||||||||||||||
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS |
$ | 1,590 | $ | 1,385 | $ | 324 | $ | 72 | $ | (191 | ) | |||||||||
Reconciliation to Net Income (Loss) and Financial Statement Line Item Adjustments from GAAP |
||||||||||||||||||||
Operating earnings |
$ | 1,621 | $ | 1,385 | $ | 324 | $ | 72 | $ | (160 | ) | |||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||||||
Net investment gains (losses) (1) |
(125 | ) | (189 | ) | 82 | 2 | (20 | ) | ||||||||||||
Net derivative gains (losses) |
311 | 429 | (35 | ) | 49 | (132 | ) | |||||||||||||
Premiums |
20 | 2 | - | 18 | - | |||||||||||||||
Universal life and investment-type product policy fees |
98 | 93 | 1 | 4 | - | |||||||||||||||
Net investment income |
164 | (126 | ) | 2 | 273 | 15 | ||||||||||||||
Other revenues |
(3 | ) | 1 | (4 | ) | - | - | |||||||||||||
Policyholder benefits and claims and policyholder dividends |
(421 | ) | (387 | ) | (26 | ) | (8 | ) | - | |||||||||||
Interest credited to policyholder account balances |
(284 | ) | (32 | ) | 2 | (254 | ) | - | ||||||||||||
Capitalization of DAC |
1 | - | - | 1 | - | |||||||||||||||
Amortization of DAC and VOBA |
(37 | ) | (37 | ) | 3 | (3 | ) | - | ||||||||||||
Amortization of negative VOBA |
12 | - | 12 | - | - | |||||||||||||||
Interest expense on debt |
(13 | ) | - | - | - | (13 | ) | |||||||||||||
Other expenses |
(12 | ) | 2 | 4 | - | (18 | ) | |||||||||||||
Goodwill impairment |
- | - | - | - | - | |||||||||||||||
Provision for income tax (expense) benefit |
44 | 62 | (27 | ) | (38 | ) | 47 | |||||||||||||
Income (loss) from continuing operations, net of income tax |
1,376 | 1,203 | 338 | 116 | (281 | ) | ||||||||||||||
Income (loss) from discontinued operations, net of income tax |
- | - | - | - | - | |||||||||||||||
Net income (loss) |
1,376 | 1,203 | 338 | 116 | (281 | ) | ||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
10 | 4 | 4 | 1 | 1 | |||||||||||||||
Net income (loss) attributable to MetLife, Inc. |
1,366 | 1,199 | 334 | 115 | (282 | ) | ||||||||||||||
Less: Preferred stock dividends |
31 | - | - | - | 31 | |||||||||||||||
Less: Preferred stock repurchase premium |
- | - | - | - | - | |||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 1,335 | $ | 1,199 | $ | 334 | $ | 115 | $ | (313 | ) | |||||||||
Total Operating Premiums, Fees and Other Revenues |
$ | 12,706 | $ | 9,596 | $ | 2,337 | $ | 712 | $ | 61 | ||||||||||
(1) Consolidated and Americas results include a pre-tax net investment loss of $138 million related to the sale of MetLife, Inc.s wholly-owned subsidiary, MetLife Assurance Limited. |
|
8
METLIFE CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
|
| |||||||||||||||||||
For the Year-to-Date Period Ended June 30, 2015 | ||||||||||||||||||||
Unaudited (In millions) | Consolidated | Americas | Asia | EMEA | Corporate & Other | |||||||||||||||
OPERATING REVENUES |
||||||||||||||||||||
Premiums |
$ | 18,566 | $ | 13,936 | $ | 3,561 | $ | 1,033 | $ | 36 | ||||||||||
Universal life and investment-type product policy fees |
4,629 | 3,567 | 797 | 216 | 49 | |||||||||||||||
Net investment income |
10,167 | 8,399 | 1,363 | 167 | 238 | |||||||||||||||
Other revenues |
1,030 | 906 | 56 | 29 | 39 | |||||||||||||||
Total operating revenues |
34,392 | 26,808 | 5,777 | 1,445 | 362 | |||||||||||||||
OPERATING EXPENSES |
||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
18,950 | 15,711 | 2,715 | 504 | 20 | |||||||||||||||
Interest credited to policyholder account balances |
2,673 | 1,930 | 665 | 64 | 14 | |||||||||||||||
Capitalization of DAC |
(1,895 | ) | (797 | ) | (833 | ) | (265 | ) | - | |||||||||||
Amortization of DAC and VOBA |
1,954 | 1,030 | 662 | 261 | 1 | |||||||||||||||
Amortization of negative VOBA |
(173 | ) | (1 | ) | (164 | ) | (8 | ) | - | |||||||||||
Interest expense on debt |
604 | 1 | - | - | 603 | |||||||||||||||
Other expenses |
7,682 | 4,839 | 1,773 | 751 | 319 | |||||||||||||||
Total operating expenses |
29,795 | 22,713 | 4,818 | 1,307 | 957 | |||||||||||||||
Operating earnings before provision for income tax |
4,597 | 4,095 | 959 | 138 | (595 | ) | ||||||||||||||
Provision for income tax expense (benefit) |
1,133 | 1,271 | 207 | 18 | (363 | ) | ||||||||||||||
Operating earnings |
3,464 | 2,824 | 752 | 120 | (232 | ) | ||||||||||||||
Preferred stock dividends |
61 | - | - | - | 61 | |||||||||||||||
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS |
$ | 3,403 | $ | 2,824 | $ | 752 | $ | 120 | $ | (293 | ) | |||||||||
Reconciliation to Net Income (Loss) and Financial Statement Line Item Adjustments from GAAP |
||||||||||||||||||||
Operating earnings |
$ | 3,464 | $ | 2,824 | $ | 752 | $ | 120 | $ | (232 | ) | |||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||||||
Net investment gains (losses) |
153 | 260 | 125 | 8 | (240 | ) | ||||||||||||||
Net derivative gains (losses) |
(91 | ) | 69 | 27 | 14 | (201 | ) | |||||||||||||
Premiums |
(1 | ) | (1 | ) | - | - | - | |||||||||||||
Universal life and investment-type product policy fees |
199 | 191 | 10 | (2 | ) | - | ||||||||||||||
Net investment income |
241 | (351 | ) | 302 | 282 | 8 | ||||||||||||||
Other revenues |
(17 | ) | - | (17 | ) | - | - | |||||||||||||
Policyholder benefits and claims and policyholder dividends |
(329 | ) | (236 | ) | (93 | ) | - | - | ||||||||||||
Interest credited to policyholder account balances |
(620 | ) | (38 | ) | (306 | ) | (276 | ) | - | |||||||||||
Capitalization of DAC |
- | - | - | - | - | |||||||||||||||
Amortization of DAC and VOBA |
32 | 37 | (7 | ) | 2 | - | ||||||||||||||
Amortization of negative VOBA |
19 | - | 19 | - | - | |||||||||||||||
Interest expense on debt |
(2 | ) | - | - | - | (2 | ) | |||||||||||||
Other expenses |
(9 | ) | 6 | - | 1 | (16 | ) | |||||||||||||
Goodwill impairment |
- | - | - | - | - | |||||||||||||||
Provision for income tax (expense) benefit |
243 | 16 | 101 | (19 | ) | 145 | ||||||||||||||
Income (loss) from continuing operations, net of income tax |
3,282 | 2,777 | 913 | 130 | (538 | ) | ||||||||||||||
Income (loss) from discontinued operations, net of income tax |
- | - | - | - | - | |||||||||||||||
Net income (loss) |
3,282 | 2,777 | 913 | 130 | (538 | ) | ||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
9 | 6 | 1 | 1 | 1 | |||||||||||||||
Net income (loss) attributable to MetLife, Inc. |
3,273 | 2,771 | 912 | 129 | (539 | ) | ||||||||||||||
Less: Preferred stock dividends |
61 | - | - | - | 61 | |||||||||||||||
Less: Preferred stock repurchase premium |
42 | - | - | - | 42 | |||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 3,170 | $ | 2,771 | $ | 912 | $ | 129 | $ | (642 | ) | |||||||||
Total Operating Premiums, Fees and Other Revenues |
$ | 24,225 | $ | 18,409 | $ | 4,414 | $ | 1,278 | $ | 124 |
9
METLIFE CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
|
| |||||||||||||||||||
For the Year-to-Date Period Ended June 30, 2014 | ||||||||||||||||||||
Unaudited (In millions) | Consolidated | Americas | Asia | EMEA | Corporate & Other | |||||||||||||||
OPERATING REVENUES |
||||||||||||||||||||
Premiums |
$ | 19,070 | $ | 14,044 | $ | 3,803 | $ | 1,181 | $ | 42 | ||||||||||
Universal life and investment-type product policy fees |
4,683 | 3,601 | 789 | 226 | 67 | |||||||||||||||
Net investment income |
10,180 | 8,255 | 1,424 | 219 | 282 | |||||||||||||||
Other revenues |
984 | 880 | 51 | 27 | 26 | |||||||||||||||
Total operating revenues |
34,917 | 26,780 | 6,067 | 1,653 | 417 | |||||||||||||||
OPERATING EXPENSES |
||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
19,337 | 15,941 | 2,822 | 532 | 42 | |||||||||||||||
Interest credited to policyholder account balances |
2,826 | 1,958 | 781 | 69 | 18 | |||||||||||||||
Capitalization of DAC |
(2,077 | ) | (780 | ) | (951 | ) | (346 | ) | - | |||||||||||
Amortization of DAC and VOBA |
2,075 | 1,051 | 700 | 324 | - | |||||||||||||||
Amortization of negative VOBA |
(202 | ) | (1 | ) | (186 | ) | (15 | ) | - | |||||||||||
Interest expense on debt |
593 | 4 | - | - | 589 | |||||||||||||||
Other expenses |
7,930 | 4,705 | 1,968 | 920 | 337 | |||||||||||||||
Total operating expenses |
30,482 | 22,878 | 5,134 | 1,484 | 986 | |||||||||||||||
Operating earnings before provision for income tax |
4,435 | 3,902 | 933 | 169 | (569 | ) | ||||||||||||||
Provision for income tax expense (benefit) |
1,222 | 1,193 | 276 | 26 | (273 | ) | ||||||||||||||
Operating earnings |
3,213 | 2,709 | 657 | 143 | (296 | ) | ||||||||||||||
Preferred stock dividends |
61 | - | - | - | 61 | |||||||||||||||
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS |
$ | 3,152 | $ | 2,709 | $ | 657 | $ | 143 | $ | (357 | ) | |||||||||
Reconciliation to Net Income (Loss) and Financial Statement Line Item Adjustments from GAAP |
||||||||||||||||||||
Operating earnings |
$ | 3,213 | $ | 2,709 | $ | 657 | $ | 143 | $ | (296 | ) | |||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||||||
Net investment gains (losses) (1) |
(536 | ) | (706 | ) | 239 | (7 | ) | (62 | ) | |||||||||||
Net derivative gains (losses) |
654 | 715 | (42 | ) | 87 | (106 | ) | |||||||||||||
Premiums |
22 | 1 | - | 21 | - | |||||||||||||||
Universal life and investment-type product policy fees |
196 | 188 | 1 | 7 | - | |||||||||||||||
Net investment income |
114 | (239 | ) | (33 | ) | 360 | 26 | |||||||||||||
Other revenues |
(16 | ) | 1 | (17 | ) | - | - | |||||||||||||
Policyholder benefits and claims and policyholder dividends |
(675 | ) | (621 | ) | (44 | ) | (10 | ) | - | |||||||||||
Interest credited to policyholder account balances |
(352 | ) | (49 | ) | 37 | (340 | ) | - | ||||||||||||
Capitalization of DAC |
1 | - | - | 1 | - | |||||||||||||||
Amortization of DAC and VOBA |
(45 | ) | (42 | ) | 4 | (7 | ) | - | ||||||||||||
Amortization of negative VOBA |
24 | - | 24 | - | - | |||||||||||||||
Interest expense on debt |
(31 | ) | - | - | - | (31 | ) | |||||||||||||
Other expenses |
(15 | ) | 2 | 10 | (2 | ) | (25 | ) | ||||||||||||
Goodwill impairment |
- | - | - | - | - | |||||||||||||||
Provision for income tax (expense) benefit |
164 | 231 | (68 | ) | (51 | ) | 52 | |||||||||||||
Income (loss) from continuing operations, net of income tax |
2,718 | 2,190 | 768 | 202 | (442 | ) | ||||||||||||||
Income (loss) from discontinued operations, net of income tax |
(3 | ) | (3 | ) | - | - | - | |||||||||||||
Net income (loss) |
2,715 | 2,187 | 768 | 202 | (442 | ) | ||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
21 | 9 | 10 | 1 | 1 | |||||||||||||||
Net income (loss) attributable to MetLife, Inc. |
2,694 | 2,178 | 758 | 201 | (443 | ) | ||||||||||||||
Less: Preferred stock dividends |
61 | - | - | - | 61 | |||||||||||||||
Less: Preferred stock repurchase premium |
- | - | - | - | - | |||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 2,633 | $ | 2,178 | $ | 758 | $ | 201 | $ | (504 | ) | |||||||||
Total Operating Premiums, Fees and Other Revenues |
$ | 24,737 | $ | 18,525 | $ | 4,643 | $ | 1,434 | $ | 135 | ||||||||||
(1) Consolidated and Americas results include a pre-tax net investment loss of $633 million related to the sale of MetLife, Inc.s wholly-owned subsidiary, MetLife Assurance Limited. |
|
10
11
12
AMERICAS RETAIL - LIFE & OTHER STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
|
| |||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
OPERATING REVENUES |
||||||||||||||||||||||||||||||
Premiums |
$ | 1,508 | $ | 1,521 | $ | 1,627 | $ | 1,494 | $ | 1,522 | $ | 2,994 | $ | 3,016 | ||||||||||||||||
Universal life and investment-type product policy fees |
394 | 434 | 402 | 392 | 384 | 794 | 776 | |||||||||||||||||||||||
Net investment income |
1,222 | 1,247 | 1,263 | 1,245 | 1,275 | 2,471 | 2,520 | |||||||||||||||||||||||
Other revenues |
154 | 165 | 166 | 144 | 153 | 291 | 297 | |||||||||||||||||||||||
Total operating revenues |
3,278 | 3,367 | 3,458 | 3,275 | 3,334 | 6,550 | 6,609 | |||||||||||||||||||||||
OPERATING EXPENSES |
||||||||||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
1,991 | 1,974 | 2,055 | 2,070 | 2,016 | 4,023 | 4,086 | |||||||||||||||||||||||
Interest credited to policyholder account balances |
226 | 230 | 229 | 227 | 230 | 445 | 457 | |||||||||||||||||||||||
Capitalization of DAC |
(168 | ) | (158 | ) | (163 | ) | (158 | ) | (159 | ) | (313 | ) | (317 | ) | ||||||||||||||||
Amortization of DAC and VOBA |
196 | 164 | 193 | 210 | 205 | 397 | 415 | |||||||||||||||||||||||
Amortization of negative VOBA |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Interest expense on debt |
(1 | ) | (1 | ) | 1 | (1 | ) | (1 | ) | (1 | ) | (2 | ) | |||||||||||||||||
Other expenses |
646 | 621 | 648 | 632 | 634 | 1,233 | 1,266 | |||||||||||||||||||||||
Total operating expenses |
2,890 | 2,830 | 2,963 | 2,980 | 2,925 | 5,784 | 5,905 | |||||||||||||||||||||||
Operating earnings before provision for income tax |
388 | 537 | 495 | 295 | 409 | 766 | 704 | |||||||||||||||||||||||
Provision for income tax expense (benefit) |
122 | 172 | 162 | 92 | 131 | 245 | 223 | |||||||||||||||||||||||
Operating earnings |
266 | 365 | 333 | 203 | 278 | 521 | 481 | |||||||||||||||||||||||
Preferred stock dividends |
- | - | - | - | - | - | - | |||||||||||||||||||||||
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS |
$ | 266 | $ | 365 | $ | 333 | $ | 203 | $ | 278 | $ | 521 | $ | 481 | ||||||||||||||||
Reconciliation to Net Income (Loss) and Financial Statement Line Item Adjustments from GAAP |
||||||||||||||||||||||||||||||
Operating earnings |
$ | 266 | $ | 365 | $ | 333 | $ | 203 | $ | 278 | $ | 521 | $ | 481 | ||||||||||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||||||||||||||||
Net investment gains (losses) |
1 | (9 | ) | (35 | ) | 1 | 19 | (13 | ) | 20 | ||||||||||||||||||||
Net derivative gains (losses) |
6 | 98 | 119 | 186 | (110 | ) | 75 | 76 | ||||||||||||||||||||||
Premiums |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Universal life and investment-type product policy fees |
(1 | ) | - | - | - | (1 | ) | (1 | ) | (1 | ) | |||||||||||||||||||
Net investment income |
(54 | ) | (56 | ) | (57 | ) | (60 | ) | (59 | ) | (109 | ) | (119 | ) | ||||||||||||||||
Other revenues |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
- | - | 6 | 17 | (10 | ) | - | 7 | ||||||||||||||||||||||
Interest credited to policyholder account balances |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Capitalization of DAC |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Amortization of DAC and VOBA |
(11 | ) | 68 | (19 | ) | (19 | ) | 24 | (27 | ) | 5 | |||||||||||||||||||
Amortization of negative VOBA |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Interest expense on debt |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Other expenses |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Goodwill impairment |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Provision for income tax (expense) benefit |
21 | (36 | ) | (2 | ) | (44 | ) | 48 | 27 | 4 | ||||||||||||||||||||
Income (loss) from continuing operations, net of income tax |
228 | 430 | 345 | 284 | 189 | 473 | 473 | |||||||||||||||||||||||
Income (loss) from discontinued operations, net of income tax |
- | - | - | - | - | (2 | ) | - | ||||||||||||||||||||||
Net income (loss) |
228 | 430 | 345 | 284 | 189 | 471 | 473 | |||||||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Net income (loss) attributable to MetLife, Inc. |
228 | 430 | 345 | 284 | 189 | 471 | 473 | |||||||||||||||||||||||
Less: Preferred stock dividends |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Less: Preferred stock repurchase premium |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 228 | $ | 430 | $ | 345 | $ | 284 | $ | 189 | $ | 471 | $ | 473 | ||||||||||||||||
Total Operating Premiums, Fees and Other Revenues |
$ | 2,056 | $ | 2,120 | $ | 2,195 | $ | 2,030 | $ | 2,059 | $ | 4,079 | $ | 4,089 |
13
AMERICAS RETAIL - ANNUITIES STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
|
| |||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
OPERATING REVENUES |
||||||||||||||||||||||||||||||
Premiums |
$ | 304 | $ | 348 | $ | 248 | $ | 255 | $ | 225 | $ | 542 | $ | 480 | ||||||||||||||||
Universal life and investment-type product policy fees |
862 | 877 | 858 | 844 | 868 | 1,709 | 1,712 | |||||||||||||||||||||||
Net investment income |
725 | 718 | 718 | 735 | 728 | 1,470 | 1,463 | |||||||||||||||||||||||
Other revenues |
111 | 110 | 108 | 107 | 110 | 219 | 217 | |||||||||||||||||||||||
Total operating revenues |
2,002 | 2,053 | 1,932 | 1,941 | 1,931 | 3,940 | 3,872 | |||||||||||||||||||||||
OPERATING EXPENSES |
||||||||||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
447 | 581 | 396 | 379 | 357 | 822 | 736 | |||||||||||||||||||||||
Interest credited to policyholder account balances |
335 | 337 | 333 | 315 | 321 | 671 | 636 | |||||||||||||||||||||||
Capitalization of DAC |
(81 | ) | (81 | ) | (84 | ) | (89 | ) | (98 | ) | (170 | ) | (187 | ) | ||||||||||||||||
Amortization of DAC and VOBA |
182 | 171 | 180 | 165 | 195 | 410 | 360 | |||||||||||||||||||||||
Amortization of negative VOBA |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Interest expense on debt |
1 | - | 1 | - | 1 | 1 | 1 | |||||||||||||||||||||||
Other expenses |
535 | 542 | 577 | 544 | 586 | 1,090 | 1,130 | |||||||||||||||||||||||
Total operating expenses |
1,419 | 1,550 | 1,403 | 1,314 | 1,362 | 2,824 | 2,676 | |||||||||||||||||||||||
Operating earnings before provision for income tax |
583 | 503 | 529 | 627 | 569 | 1,116 | 1,196 | |||||||||||||||||||||||
Provision for income tax expense (benefit) |
172 | 83 | 144 | 177 | 157 | 324 | 334 | |||||||||||||||||||||||
Operating earnings |
411 | 420 | 385 | 450 | 412 | 792 | 862 | |||||||||||||||||||||||
Preferred stock dividends |
- | - | - | - | - | - | - | |||||||||||||||||||||||
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS |
$ | 411 | $ | 420 | $ | 385 | $ | 450 | $ | 412 | $ | 792 | $ | 862 | ||||||||||||||||
Reconciliation to Net Income (Loss) and Financial Statement Line Item Adjustments from GAAP |
||||||||||||||||||||||||||||||
Operating earnings |
$ | 411 | $ | 420 | $ | 385 | $ | 450 | $ | 412 | $ | 792 | $ | 862 | ||||||||||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||||||||||||||||
Net investment gains (losses) |
9 | 18 | 3 | 67 | (10 | ) | 29 | 57 | ||||||||||||||||||||||
Net derivative gains (losses) |
219 | 185 | (134 | ) | 127 | 15 | 221 | 142 | ||||||||||||||||||||||
Premiums |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Universal life and investment-type product policy fees |
93 | 96 | 96 | 94 | 95 | 186 | 189 | |||||||||||||||||||||||
Net investment income |
(60 | ) | (53 | ) | (60 | ) | (68 | ) | (46 | ) | (122 | ) | (114 | ) | ||||||||||||||||
Other revenues |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
(215 | ) | (34 | ) | (135 | ) | (113 | ) | (150 | ) | (333 | ) | (263 | ) | ||||||||||||||||
Interest credited to policyholder account balances |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Capitalization of DAC |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Amortization of DAC and VOBA |
(26 | ) | (121 | ) | 19 | (43 | ) | 75 | (15 | ) | 32 | |||||||||||||||||||
Amortization of negative VOBA |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Interest expense on debt |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Other expenses |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Goodwill impairment |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Provision for income tax (expense) benefit |
(7 | ) | (32 | ) | 73 | (22 | ) | 7 | 12 | (15 | ) | |||||||||||||||||||
Income (loss) from continuing operations, net of income tax |
424 | 479 | 247 | 492 | 398 | 770 | 890 | |||||||||||||||||||||||
Income (loss) from discontinued operations, net of income tax |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Net income (loss) |
424 | 479 | 247 | 492 | 398 | 770 | 890 | |||||||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Net income (loss) attributable to MetLife, Inc. |
424 | 479 | 247 | 492 | 398 | 770 | 890 | |||||||||||||||||||||||
Less: Preferred stock dividends |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Less: Preferred stock repurchase premium |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 424 | $ | 479 | $ | 247 | $ | 492 | $ | 398 | $ | 770 | $ | 890 | ||||||||||||||||
Total Operating Premiums, Fees and Other Revenues |
$ | 1,277 | $ | 1,335 | $ | 1,214 | $ | 1,206 | $ | 1,203 | $ | 2,470 | $ | 2,409 |
14
15
16
AMERICAS RETAIL
VARIABLE & UNIVERSAL LIFE (1)
|
||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Investment income yield excluding variable investment income |
6.15% | 6.06% | 6.13% | 6.01% | 6.29% | |||||||||||||||
Variable investment income yield |
0.02% | 0.51% | 0.38% | 0.32% | 0.39% | |||||||||||||||
Total investment income yield |
6.17% | 6.57% | 6.51% | 6.33% | 6.68% | |||||||||||||||
Average crediting rate |
4.50% | 4.51% | 4.50% | 4.53% | 4.53% | |||||||||||||||
Annualized general account spread |
1.67% | 2.06% | 2.01% | 1.80% | 2.15% | |||||||||||||||
Annualized general account spread excluding variable investment income yield |
1.65% | 1.55% | 1.63% | 1.48% | 1.76% | |||||||||||||||
ANNUITIES (2)
|
||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Investment income yield excluding variable investment income |
5.83% | 5.64% | 5.64% | 5.72% | 5.48% | |||||||||||||||
Variable investment income yield |
0.25% | 0.31% | 0.22% | 0.22% | 0.37% | |||||||||||||||
Total investment income yield |
6.08% | 5.95% | 5.86% | 5.94% | 5.85% | |||||||||||||||
Average crediting rate |
3.51% | 3.53% | 3.52% | 3.48% | 3.51% | |||||||||||||||
Annualized general account spread |
2.57% | 2.42% | 2.34% | 2.46% | 2.34% | |||||||||||||||
Annualized general account spread excluding variable investment income yield |
2.32% | 2.11% | 2.12% | 2.24% | 1.97% | |||||||||||||||
OTHER STATISTICAL INFORMATION
|
||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited (In millions, except ratios) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Life (3) |
||||||||||||||||||||
Operating premiums, fees and other revenues |
$ | 1,377 | $ | 1,427 | $ | 1,499 | $ | 1,370 | $ | 1,386 | ||||||||||
Interest Adjusted Benefit Ratio |
48.9% | 51.7% | 53.9% | 59.3% | 53.0% | |||||||||||||||
Lapse Ratio (4) |
||||||||||||||||||||
Traditional life |
5.8% | 5.9% | 5.9% | 5.8% | 5.6% | |||||||||||||||
Variable & universal life |
4.1% | 4.0% | 3.8% | 3.8% | 3.6% | |||||||||||||||
Fixed annuity |
10.3% | 10.1% | 10.6% | 9.8% | 9.9% | |||||||||||||||
Variable annuity |
6.5% | 6.7% | 6.9% | 7.0% | 7.0% | |||||||||||||||
Retail Property & Casualty |
||||||||||||||||||||
Operating premiums, fees and other revenues |
$ | 452 | $ | 457 | $ | 458 | $ | 445 | $ | 448 | ||||||||||
Combined ratio including catastrophes |
107.5% | 83.6% | 85.8% | 89.3% | 100.1% | |||||||||||||||
Combined ratio excluding catastrophes |
83.6% | 79.3% | 81.5% | 79.4% | 80.2% | |||||||||||||||
(1) Represents the general account spread for variable & universal life, a component of Life & Other.
(2) Represents the general account spread for deferred and payout annuities.
(3) Represents traditional life and variable & universal life, components of Life & Other.
(4) Lapse ratios are calculated based on the average of the most recent 12 months of experience. |
17
18
19
20
21
22
23
24
25
26
ASIA
|
| |||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Direct and allocated expenses |
$ | 337 | $ | 346 | $ | 332 | $ | 299 | $ | 320 | ||||||||||
Pension and post-retirement benefit costs |
18 | 18 | 19 | 19 | 17 | |||||||||||||||
Premium taxes, other taxes, and licenses & fees |
38 | 42 | 48 | 36 | 37 | |||||||||||||||
Total fixed operating expenses |
$ | 393 | $ | 406 | $ | 399 | $ | 354 | $ | 374 | ||||||||||
Commissions and other variable expenses |
584 | 621 | 581 | 550 | 495 | |||||||||||||||
Total other expenses |
$ | 977 | $ | 1,027 | $ | 980 | $ | 904 | $ | 869 | ||||||||||
Total other expenses on a constant currency basis (1) |
$ | 858 | $ | 905 | $ | 921 | $ | 897 | $ | 869 | ||||||||||
SALES ON A CONSTANT CURRENCY BASIS (1), (2)
|
||||||||||||||||||||
For the Three Months Ended | ||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Japan: |
||||||||||||||||||||
Life |
$ | 153 | $ | 150 | $ | 173 | $ | 169 | $ | 198 | ||||||||||
Accident & Health |
89 | 85 | 129 | 111 | 118 | |||||||||||||||
Annuities |
97 | 94 | 74 | 65 | 62 | |||||||||||||||
Other |
5 | 6 | 5 | 4 | 6 | |||||||||||||||
Total Japan |
344 | 335 | 381 | 349 | 384 | |||||||||||||||
Other Asia |
245 | 363 | 247 | 262 | 212 | |||||||||||||||
Total sales |
$ | 589 | $ | 698 | $ | 628 | $ | 611 | $ | 596 | ||||||||||
(1) Calculated using the average foreign currency exchange rates for the current period and are applied to the prior periods presented. As a result, amounts will be updated each period to reflect the average foreign currency exchange rates for the current period.
(2) Statistical sales information is calculated using 10% of single-premium deposits (mainly from retirement products such as variable annuity, fixed annuity and pensions), 20% of single-premium deposits from credit insurance and 100% of annualized full year premiums and fees from recurring-premium policy sales of all products (mainly from risk and protection products such as individual life, accident & health and group). Sales statistics do not correspond to revenues under GAAP, but are used as relevant measures of business activity. |
|
27
28
29
30
31
INVESTMENTS INVESTMENT PORTFOLIO RESULTS BY ASSET CATEGORY AND ANNUALIZED YIELDS
|
| |||||||||||||||||||
At or For the Year-to-Date Period Ended | ||||||||||||||||||||
Unaudited (In millions, except yields) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||
Fixed Maturity Securities |
||||||||||||||||||||
Yield (1) |
4.83% | 4.80% | 4.81% | 4.64% | 4.72% | |||||||||||||||
Investment income (2), (3), (4) |
$ | 7,481 | $ | 11,185 | $ | 14,946 | $ | 3,569 | $ | 7,234 | ||||||||||
Investment gains (losses) (3) |
149 | 302 | 548 | 133 | 248 | |||||||||||||||
Ending carrying value (2), (3) |
368,428 | 369,432 | 366,783 | 367,640 | 352,610 | |||||||||||||||
Mortgage Loans |
||||||||||||||||||||
Yield (1) |
5.06% | 5.19% | 5.15% | 4.80% | 4.95% | |||||||||||||||
Investment income (3), (4) |
1,417 | 2,191 | 2,928 | 730 | 1,531 | |||||||||||||||
Investment gains (losses) (3) |
5 | (25 | ) | (36 | ) | (43 | ) | (52 | ) | |||||||||||
Ending carrying value (3) |
56,585 | 57,725 | 59,838 | 62,137 | 63,744 | |||||||||||||||
Real Estate and Real Estate Joint Ventures |
||||||||||||||||||||
Yield (1) |
3.98% | 3.88% | 3.67% | 3.10% | 5.23% | |||||||||||||||
Investment income (3) |
203 | 297 | 376 | 81 | 270 | |||||||||||||||
Investment gains (losses) (3) |
59 | 145 | 217 | 27 | (6 | ) | ||||||||||||||
Ending carrying value |
10,101 | 10,393 | 10,525 | 10,310 | 10,207 | |||||||||||||||
Policy Loans |
||||||||||||||||||||
Yield (1) |
5.35% | 5.36% | 5.36% | 5.24% | 5.23% | |||||||||||||||
Investment income |
315 | 473 | 629 | 152 | 303 | |||||||||||||||
Ending carrying value |
11,785 | 11,756 | 11,618 | 11,606 | 11,575 | |||||||||||||||
Equity Securities |
||||||||||||||||||||
Yield (1) |
4.30% | 4.18% | 4.30% | 4.01% | 4.30% | |||||||||||||||
Investment income |
67 | 98 | 133 | 31 | 66 | |||||||||||||||
Investment gains (losses) |
50 | 64 | 65 | 8 | 16 | |||||||||||||||
Ending carrying value |
3,863 | 3,689 | 3,631 | 3,713 | 3,677 | |||||||||||||||
Other Limited Partnership Interests |
||||||||||||||||||||
Yield (1) |
13.81% | 14.14% | 13.01% | 10.62% | 11.50% | |||||||||||||||
Investment income |
535 | 834 | 1,033 | 215 | 465 | |||||||||||||||
Investment gains (losses) |
(38 | ) | (52 | ) | (78 | ) | 16 | 7 | ||||||||||||
Ending carrying value |
7,964 | 8,214 | 8,085 | 8,074 | 8,099 | |||||||||||||||
Cash and Short-term Investments |
||||||||||||||||||||
Yield (1) |
1.11% | 1.09% | 1.07% | 1.00% | 1.02% | |||||||||||||||
Investment income |
84 | 124 | 161 | 33 | 66 | |||||||||||||||
Investment gains (losses) |
(1 | ) | (1 | ) | 11 | 6 | (6 | ) | ||||||||||||
Ending carrying value |
19,759 | 21,023 | 19,429 | 22,257 | 22,668 | |||||||||||||||
Other Invested Assets (1) |
||||||||||||||||||||
Investment income |
420 | 653 | 906 | 327 | 550 | |||||||||||||||
Investment gains (losses) (3) |
(6 | ) | (24 | ) | (120 | ) | 18 | (1 | ) | |||||||||||
Ending carrying value |
17,116 | 17,905 | 21,283 | 23,763 | 20,409 | |||||||||||||||
Total Investments |
||||||||||||||||||||
Investment income yield (1) |
5.02% | 5.02% | 5.01% | 4.89% | 4.99% | |||||||||||||||
Investment fees and expenses yield |
(0.13 | )% | (0.13 | )% | (0.13 | )% | (0.15 | )% | (0.15 | )% | ||||||||||
Net Investment Income Yield (1), (3), (5) |
4.89% | 4.89% | 4.88% | 4.74% | 4.84% | |||||||||||||||
Investment income |
$ | 10,522 | $ | 15,855 | $ | 21,112 | $ | 5,138 | $ | 10,485 | ||||||||||
Investment fees and expenses |
(275 | ) | (412 | ) | (556 | ) | (156 | ) | (318 | ) | ||||||||||
Net investment income including Divested businesses |
10,247 | 15,443 | 20,556 | 4,982 | 10,167 | |||||||||||||||
Less: Net investment income from Divested businesses (5) |
67 | 70 | 72 | - | - | |||||||||||||||
Net Investment Income (3) |
$ | 10,180 | $ | 15,373 | $ | 20,484 | $ | 4,982 | $ | 10,167 | ||||||||||
Ending Carrying Value (3) |
$ | 495,601 | $ | 500,137 | $ | 501,192 | $ | 509,500 | $ | 492,989 | ||||||||||
Investment portfolio gains (losses) including Divested businesses |
$ | 218 | $ | 409 | $ | 607 | $ | 165 | $ | 206 | ||||||||||
Less: Investment portfolio gains (losses) from Divested businesses (5) |
- | 2 | 2 | - | - | |||||||||||||||
Investment Portfolio Gains (Losses) (3), (5) |
$ | 218 | $ | 407 | $ | 605 | $ | 165 | $ | 206 | ||||||||||
Gross investment gains |
$ | 711 | $ | 1,130 | $ | 1,689 | $ | 445 | $ | 864 | ||||||||||
Gross investment losses |
(385 | ) | (552 | ) | (789 | ) | (236 | ) | (497 | ) | ||||||||||
Writedowns |
(108 | ) | (171 | ) | (295 | ) | (44 | ) | (161 | ) | ||||||||||
Investment Portfolio Gains (Losses) (3), (5) |
218 | 407 | 605 | 165 | 206 | |||||||||||||||
Investment portfolio gains (losses) income tax (expense) benefit |
(87 | ) | (191 | ) | (260 | ) | (52 | ) | 51 | |||||||||||
Investment Portfolio Gains (Losses), Net of Income Tax |
$ | 131 | $ | 216 | $ | 345 | $ | 113 | $ | 257 | ||||||||||
Derivative Gains (Losses) including Divested businesses |
$ | 287 | $ | 593 | $ | 575 | $ | 611 | $ | (492 | ) | |||||||||
Less: Derivative gains (losses) from Divested businesses (5) |
80 | 80 | 80 | - | - | |||||||||||||||
Derivative gains (losses) (3), (5) |
207 | 513 | 495 | 611 | (492 | ) | ||||||||||||||
Derivative gains (losses) income tax (expense) benefit |
(58 | ) | (177 | ) | (199 | ) | (217 | ) | 165 | |||||||||||
Derivative Gains (Losses), Net of Income Tax |
$ | 149 | $ | 336 | $ | 296 | $ | 394 | $ | (327 | ) | |||||||||
(1) Yields are calculated as investment income as a percent of average quarterly asset carrying values. Investment income excludes recognized gains and losses and reflects the GAAP adjustments described on Page 2 and as presented on Page A-1. Asset carrying values exclude unrealized gains (losses), collateral received in connection with our securities lending program, freestanding derivative assets, collateral received from derivative counterparties, the effects of consolidating under GAAP certain VIEs that are treated as CSEs and contractholder-directed unit-linked investments. A yield is not presented for other invested assets, as it is not considered a meaningful measure of performance for this asset class.
(2) Fixed maturity securities includes $1,372 million, $1,362 million, $1,358 million, $1,365 million and $1,257 million in ending carrying value, and $81 million, $95 million, $103 million, $37 million and $39 million of investment income related to fair value option and trading securities at or for the year-to-date period ended June 30, 2014, September 30, 2014, December 31, 2014, March 31, 2015 and June 30, 2015, respectively.
(3) The reconciliation of the remaining yield table captions to the most directly comparable measures presented in accordance with GAAP are as follows at or for the periods ended June 30, 2014, September 30, 2014, December 31, 2014, March 31, 2015 and June 30, 2015, respectively: A) Fair value option and trading securities (included within fixed maturity securities above) ending carrying value excludes contractholder-directed unit-linked investments of $16,441 million, $15,866 million, $15,316 million, $15,091 million and $15,189 million; B) Ending carrying value excludes the following effects of consolidating under GAAP certain VIEs that are treated as CSEs: Fair value option and trading securities (included within fixed maturity securities above) of $18 million, $18 million, $15 million, $15 million and $14 million and mortgage loans of $638 million, $313 million, $280 million, $272 million and $266 million; C) Net investment income adjustments as presented on Page A-1; D) Investment portfolio gains (losses) as presented above and the GAAP adjustments as presented below; and E) Derivative gains (losses) as presented above and GAAP adjustments as presented below:
|
| |||||||||||||||||||
For the Year-to-Date Period Ended | ||||||||||||||||||||
June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | ||||||||||||||||
Investment portfolio gains (losses) including Divested businesses - in above yield table |
$ | 218 | $ | 407 | $ | 605 | $ | 165 | $ | 206 | ||||||||||
Real estate discontinued operations |
5 | 5 | 5 | - | - | |||||||||||||||
Operating joint venture adjustments |
- | - | - | (1 | ) | 3 | ||||||||||||||
Net investment gains (losses) related to certain CSEs |
3 | 6 | 5 | (2 | ) | - | ||||||||||||||
Other gains (losses) reported in net investment gains (losses) on GAAP basis |
(762 | ) | (845 | ) | (812 | ) | 124 | (56 | ) | |||||||||||
Net investment gains (losses) - GAAP basis |
$ | (536 | ) | $ | (427 | ) | $ | (197 | ) | $ | 286 | $ | 153 | |||||||
For the Year-to-Date Period Ended | ||||||||||||||||||||
June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | ||||||||||||||||
Derivative gains (losses) including Divested businesses - in above yield table |
$ | 287 | $ | 593 | $ | 575 | $ | 611 | $ | (492 | ) | |||||||||
Investment hedge adjustments (5) |
344 | 513 | 705 | 200 | 380 | |||||||||||||||
Operating joint venture adjustments |
(1 | ) | (2 | ) | 1 | - | - | |||||||||||||
Settlement of foreign currency earnings hedges |
17 | 17 | 22 | 8 | 17 | |||||||||||||||
PAB hedge adjustments |
7 | 11 | 14 | 2 | 4 | |||||||||||||||
Net derivative gains (losses) - GAAP basis |
$ | 654 | $ | 1,132 | $ | 1,317 | $ | 821 | $ | (91 | ) | |||||||||
(4) Investment income from fixed maturity securities and mortgage loans includes prepayment fees.
(5) Yields are calculated including net investment income of Divested businesses and related carrying values. The net investment income adjustment on Page A-1 for Divested businesses at or for the year-to-date period ended June 30, 2014, September 30, 2014, December 31, 2014, March 31, 2015 and June 30, 2015, excludes $1 million, $1 million, $1 million, $0 and $0, respectively, for the investment hedge adjustment that are included in the investment hedge adjustment line of the derivatives gains (loss) GAAP adjustments reconciliation table presented above.
|
|
32
33
34
INVESTMENTS
|
| |||||||||||||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | |||||||||||||||||||||||||||||||||||
Commercial mortgage loans |
$40,604 | $40,540 | $41,088 | $42,164 | $42,953 | |||||||||||||||||||||||||||||||||||
Agricultural mortgage loans |
11,961 | 11,929 | 12,378 | 12,333 | 12,498 | |||||||||||||||||||||||||||||||||||
Residential mortgage loans |
4,314 | 5,563 | 6,677 | 7,955 | 8,618 | |||||||||||||||||||||||||||||||||||
Total Mortgage Loans |
56,879 | 58,032 | 60,143 | 62,452 | 64,069 | |||||||||||||||||||||||||||||||||||
Valuation allowances |
(294) | (307) | (305) | (315) | (325) | |||||||||||||||||||||||||||||||||||
Total Mortgage Loans, net |
$56,585 | $57,725 | $59,838 | $62,137 | $63,744 | |||||||||||||||||||||||||||||||||||
(1) Excludes the effects of consolidating under GAAP certain VIEs that are treated as CSEs. See Page 31, note 3, for the amount excluded for each period presented. |
| |||||||||||||||||||||||||||||||||||||||
SUMMARY OF COMMERCIAL MORTGAGE LOANS BY REGION AND PROPERTY TYPE
|
| |||||||||||||||||||||||||||||||||||||||
June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | ||||||||||||||||||||||||||||||||||||
Unaudited (In millions) | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | Amount | % of Total | ||||||||||||||||||||||||||||||
Pacific |
$ | 9,017 | 22.2% | $ | 8,815 | 21.7% | $ | 8,620 | 21.0% | $ | 9,197 | 21.8% | $ | 9,221 | 21.5% | |||||||||||||||||||||||||
Middle Atlantic |
7,232 | 17.8% | 7,582 | 18.7% | 7,689 | 18.7% | 7,617 | 18.1% | 7,864 | 18.3% | ||||||||||||||||||||||||||||||
International |
6,763 | 16.7% | 6,636 | 16.4% | 7,251 | 17.7% | 7,630 | 18.1% | 7,222 | 16.8% | ||||||||||||||||||||||||||||||
South Atlantic |
6,714 | 16.5% | 6,705 | 16.5% | 6,384 | 15.5% | 6,249 | 14.8% | 6,355 | 14.8% | ||||||||||||||||||||||||||||||
West South Central |
3,734 | 9.2% | 3,763 | 9.3% | 3,990 | 9.7% | 3,939 | 9.3% | 4,404 | 10.3% | ||||||||||||||||||||||||||||||
East North Central |
2,455 | 6.0% | 2,589 | 6.4% | 2,430 | 5.9% | 2,520 | 6.0% | 2,260 | 5.3% | ||||||||||||||||||||||||||||||
New England |
1,406 | 3.5% | 1,197 | 3.0% | 1,155 | 2.8% | 1,151 | 2.7% | 1,352 | 3.1% | ||||||||||||||||||||||||||||||
Mountain |
935 | 2.3% | 933 | 2.3% | 932 | 2.3% | 1,169 | 2.8% | 1,168 | 2.7% | ||||||||||||||||||||||||||||||
East South Central |
383 | 0.9% | 384 | 0.9% | 424 | 1.0% | 423 | 1.0% | 390 | 0.9% | ||||||||||||||||||||||||||||||
West North Central |
144 | 0.4% | 142 | 0.4% | 140 | 0.3% | 138 | 0.3% | 150 | 0.3% | ||||||||||||||||||||||||||||||
Multi-Region and Other |
1,821 | 4.5% | 1,794 | 4.4% | 2,073 | 5.1% | 2,131 | 5.1% | 2,567 | 6.0% | ||||||||||||||||||||||||||||||
Total |
$ | 40,604 | 100.0% | $ | 40,540 | 100.0% | $ | 41,088 | 100.0% | $ | 42,164 | 100.0% | $ | 42,953 | 100.0% | |||||||||||||||||||||||||
Office |
$ | 20,692 | 51.0% | $ | 21,160 | 52.2% | $ | 21,400 | 52.1% | $ | 21,094 | 50.0% | $ | 21,334 | 49.7% | |||||||||||||||||||||||||
Retail |
9,049 | 22.3% | 9,263 | 22.8% | 9,389 | 22.9% | 9,543 | 22.6% | 9,982 | 23.2% | ||||||||||||||||||||||||||||||
Apartment |
3,948 | 9.7% | 3,392 | 8.4% | 3,786 | 9.2% | 4,696 | 11.2% | 4,806 | 11.2% | ||||||||||||||||||||||||||||||
Hotel |
4,154 | 10.2% | 4,317 | 10.6% | 4,196 | 10.2% | 4,483 | 10.6% | 4,431 | 10.3% | ||||||||||||||||||||||||||||||
Industrial |
2,444 | 6.0% | 2,178 | 5.4% | 2,133 | 5.2% | 2,157 | 5.1% | 2,205 | 5.1% | ||||||||||||||||||||||||||||||
Other |
317 | 0.8% | 230 | 0.6% | 184 | 0.4% | 191 | 0.5% | 195 | 0.5% | ||||||||||||||||||||||||||||||
Total |
$ | 40,604 | 100.0% | $ | 40,540 | 100.0% | $ | 41,088 | 100.0% | $ | 42,164 | 100.0% | $ | 42,953 | 100.0% |
35
Appendix
APPENDIX METLIFE
|
| |||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
Reconciliation to Net Income (Loss) and Financial Statement Line Item Adjustments from GAAP |
||||||||||||||||||||||||||||||
Operating earnings |
$ | 1,621 | $ | 1,855 | $ | 1,614 | $ | 1,668 | $ | 1,796 | $ | 3,213 | $ | 3,464 | ||||||||||||||||
Adjustments from operating earnings to income (loss) from continuing operations, net of income tax: |
||||||||||||||||||||||||||||||
Net investment gains (losses) (1) |
(125 | ) | 109 | 230 | 286 | (133 | ) | (536 | ) | 153 | ||||||||||||||||||||
Net derivative gains (losses) |
311 | 478 | 185 | 821 | (912 | ) | 654 | (91 | ) | |||||||||||||||||||||
Premiums - Divested businesses |
20 | 18 | 5 | - | (1 | ) | 22 | (1 | ) | |||||||||||||||||||||
Universal life and investment-type product policy fees |
||||||||||||||||||||||||||||||
Unearned revenue adjustments |
3 | 8 | 6 | 4 | 3 | 6 | 7 | |||||||||||||||||||||||
GMIB fees |
93 | 96 | 96 | 94 | 95 | 186 | 189 | |||||||||||||||||||||||
Divested businesses |
2 | 2 | 1 | 2 | 1 | 4 | 3 | |||||||||||||||||||||||
Net investment income |
||||||||||||||||||||||||||||||
Investment hedge adjustments |
(165 | ) | (169 | ) | (192 | ) | (200 | ) | (180 | ) | (343 | ) | (380 | ) | ||||||||||||||||
Income from discontinued real estate operations |
- | - | - | - | - | (1 | ) | - | ||||||||||||||||||||||
Operating joint venture adjustments |
1 | 1 | (3 | ) | 1 | (4 | ) | 1 | (3 | ) | ||||||||||||||||||||
Unit-linked contract income |
295 | 379 | 527 | 677 | (55 | ) | 360 | 622 | ||||||||||||||||||||||
Securitization entities income |
13 | 3 | 4 | 1 | 1 | 31 | 2 | |||||||||||||||||||||||
Divested businesses |
20 | 3 | 2 | - | - | 66 | - | |||||||||||||||||||||||
Other revenues |
||||||||||||||||||||||||||||||
Settlement of foreign currency earnings hedges |
(4 | ) | - | (5 | ) | (8 | ) | (9 | ) | (17 | ) | (17 | ) | |||||||||||||||||
Divested businesses |
1 | - | 18 | - | - | 1 | - | |||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends |
||||||||||||||||||||||||||||||
PDO adjustments |
- | - | 6 | 17 | (10 | ) | - | 7 | ||||||||||||||||||||||
Inflation and pass through adjustments |
(160 | ) | 93 | (104 | ) | (3 | ) | 25 | (249 | ) | 22 | |||||||||||||||||||
GMIB costs |
(215 | ) | (34 | ) | (134 | ) | (112 | ) | (150 | ) | (332 | ) | (262 | ) | ||||||||||||||||
Market value adjustments |
(26 | ) | (54 | ) | (85 | ) | (51 | ) | (45 | ) | (43 | ) | (96 | ) | ||||||||||||||||
Divested businesses |
(20 | ) | (10 | ) | (3 | ) | - | - | (51 | ) | - | |||||||||||||||||||
Interest credited to policyholder account balances |
||||||||||||||||||||||||||||||
PAB hedge adjustments |
(4 | ) | (4 | ) | (3 | ) | (2 | ) | (2 | ) | (7 | ) | (4 | ) | ||||||||||||||||
Unit-linked contract costs |
(280 | ) | (387 | ) | (534 | ) | (662 | ) | 46 | (345 | ) | (616 | ) | |||||||||||||||||
Divested businesses |
- | - | (2 | ) | - | - | - | - | ||||||||||||||||||||||
Capitalization of DAC - Divested businesses |
1 | - | - | - | - | 1 | - | |||||||||||||||||||||||
Amortization of DAC and VOBA |
||||||||||||||||||||||||||||||
Related to NIGL and NDGL |
(63 | ) | 27 | (4 | ) | (112 | ) | 104 | (64 | ) | (8 | ) | ||||||||||||||||||
Related to GMIB fees and GMIB costs |
26 | (81 | ) | (1 | ) | 40 | - | 19 | 40 | |||||||||||||||||||||
Related to market value adjustments |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Divested businesses |
- | (1 | ) | - | - | - | - | - | ||||||||||||||||||||||
Amortization of negative VOBA |
||||||||||||||||||||||||||||||
Related to market value adjustments |
12 | 11 | 11 | 10 | 9 | 24 | 19 | |||||||||||||||||||||||
Divested businesses |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Interest expense on debt |
||||||||||||||||||||||||||||||
Securitization entities debt expense |
(13 | ) | (3 | ) | (4 | ) | (1 | ) | (1 | ) | (31 | ) | (2 | ) | ||||||||||||||||
Divested businesses |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Other expenses |
||||||||||||||||||||||||||||||
Noncontrolling interest |
11 | (3 | ) | 12 | 5 | 7 | 24 | 12 | ||||||||||||||||||||||
Regulatory implementation costs |
(2 | ) | - | (1 | ) | (1 | ) | (1 | ) | (2 | ) | (2 | ) | |||||||||||||||||
Acquisition & integration costs |
(10 | ) | (17 | ) | (24 | ) | (8 | ) | (7 | ) | (14 | ) | (15 | ) | ||||||||||||||||
Divested businesses |
(11 | ) | (24 | ) | (42 | ) | (1 | ) | (3 | ) | (23 | ) | (4 | ) | ||||||||||||||||
Goodwill impairment |
- | - | - | - | - | - | - | |||||||||||||||||||||||
Provision for income tax (expense) benefit |
44 | (202 | ) | (49 | ) | (302 | ) | 545 | 164 | 243 | ||||||||||||||||||||
Income (loss) from continuing operations, net of income tax |
1,376 | 2,094 | 1,527 | 2,163 | 1,119 | 2,718 | 3,282 | |||||||||||||||||||||||
Income (loss) from discontinued operations, net of income tax |
- | - | - | - | - | (3 | ) | - | ||||||||||||||||||||||
Net income (loss) |
1,376 | 2,094 | 1,527 | 2,163 | 1,119 | 2,715 | 3,282 | |||||||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
10 | - | 6 | 5 | 4 | 21 | 9 | |||||||||||||||||||||||
Net income (loss) attributable to MetLife, Inc. |
1,366 | 2,094 | 1,521 | 2,158 | 1,115 | 2,694 | 3,273 | |||||||||||||||||||||||
Less: Preferred stock dividends |
31 | 30 | 31 | 30 | 31 | 61 | 61 | |||||||||||||||||||||||
Less: Preferred stock repurchase premium |
- | - | - | - | 42 | - | 42 | |||||||||||||||||||||||
Net income (loss) available to MetLife, Inc.s common shareholders |
$ | 1,335 | $ | 2,064 | $ | 1,490 | $ | 2,128 | $ | 1,042 | $ | 2,633 | $ | 3,170 | ||||||||||||||||
(1) The three months ended and year-to-date period ended June 30, 2014 include a pre-tax net investment loss of $138 million and $633 million, respectively, related to the sale of MetLife, Inc.s wholly-owned subsidiary, MetLife Assurance Limited. |
|
A-1
APPENDIX METLIFE
METLIFE TOTAL
|
| |||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | 11 | $ | 62 | $ | - | $ | - | $ | - | $ | 74 | $ | - | ||||||||||||||||||
Catastrophe experience and prior year development, net |
(21 | ) | 38 | 16 | (16 | ) | - | (21 | ) | (16 | ) | |||||||||||||||||||||
Actuarial assumption review and other insurance adjustments |
56 | 16 | 5 | - | - | 56 | - | |||||||||||||||||||||||||
Litigation reserves & settlement costs |
- | - | (117 | ) | - | - | (57 | ) | - | |||||||||||||||||||||||
Tax adjustments |
- | (9 | ) | 27 | - | 61 | - | 61 | ||||||||||||||||||||||||
Total notable items |
$ | 46 | $ | 107 | $ | (69 | ) | $ | (16 | ) | $ | 61 | $ | 52 | $ | 45 | ||||||||||||||||
RETAIL
|
||||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | (9 | ) | $ | 25 | $ | - | $ | - | $ | - | $ | 17 | $ | - | |||||||||||||||||
Catastrophe experience and prior year development, net |
(20 | ) | 23 | 6 | (3 | ) | (2 | ) | (20 | ) | (5 | ) | ||||||||||||||||||||
Actuarial assumption review and other insurance adjustments |
56 | 19 | (9 | ) | - | - | 56 | - | ||||||||||||||||||||||||
Tax adjustments |
- | 38 | - | - | - | - | - | |||||||||||||||||||||||||
Total notable items |
$ | 27 | $ | 105 | $ | (3 | ) | $ | (3 | ) | $ | (2 | ) | $ | 53 | $ | (5 | ) | ||||||||||||||
RETAIL - LIFE & OTHER
|
||||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | (12 | ) | $ | 17 | $ | - | $ | - | $ | - | $ | 3 | $ | - | |||||||||||||||||
Catastrophe experience and prior year development, net |
(20 | ) | 23 | 6 | (3 | ) | (2 | ) | (20 | ) | (5 | ) | ||||||||||||||||||||
Actuarial assumption review and other insurance adjustments |
56 | 37 | (9 | ) | - | - | 56 | - | ||||||||||||||||||||||||
Tax adjustments |
- | 5 | - | - | - | - | - | |||||||||||||||||||||||||
Total notable items |
$ | 24 | $ | 82 | $ | (3 | ) | $ | (3 | ) | $ | (2 | ) | $ | 39 | $ | (5 | ) | ||||||||||||||
RETAIL - ANNUITIES
|
||||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | 3 | $ | 8 | $ | - | $ | - | $ | - | $ | 14 | $ | - | ||||||||||||||||||
Actuarial assumption review and other insurance adjustments |
- | (18 | ) | - | - | - | - | - | ||||||||||||||||||||||||
Tax adjustments |
- | 33 | - | - | - | - | - | |||||||||||||||||||||||||
Total notable items |
$ | 3 | $ | 23 | $ | - | $ | - | $ | - | $ | 14 | $ | - | ||||||||||||||||||
GROUP, VOLUNTARY & WORKSITE BENEFITS
|
||||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | (1 | ) | $ | 8 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||||
Catastrophe experience and prior year development, net |
(1 | ) | 15 | 10 | (12 | ) | 2 | (1 | ) | (10 | ) | |||||||||||||||||||||
Actuarial assumption review and other insurance adjustments |
- | - | (9 | ) | - | - | - | - | ||||||||||||||||||||||||
Total notable items |
$ | (2 | ) | $ | 23 | $ | 1 | $ | (12 | ) | $ | 2 | $ | (1 | ) | $ | (10 | ) | ||||||||||||||
(1) Notable items represent a positive (negative) impact to operating earnings available to common shareholders. |
|
A-2
APPENDIX METLIFE NOTABLE ITEMS (CONTINUED) (1)
|
| |||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | 21 | $ | 33 | $ | - | $ | - | $ | - | $ | 36 | $ | - | ||||||||||||||||
Total notable items |
$ | 21 | $ | 33 | $ | - | $ | - | $ | - | $ | 36 | $ | - | ||||||||||||||||
LATIN AMERICA
|
||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
Catastrophe experience and prior year development, net |
$ | - | $ | - | $ | - | $ | (1 | ) | $ | - | $ | - | $ | (1 | ) | ||||||||||||||
Tax adjustments |
- | (41 | ) | 13 | - | - | - | - | ||||||||||||||||||||||
Total notable items |
$ | - | $ | (41 | ) | $ | 13 | $ | (1 | ) | $ | - | $ | - | $ | (1 | ) | |||||||||||||
ASIA
|
||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | - | $ | 3 | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
Actuarial assumption review and other insurance adjustments |
- | (13 | ) | 23 | - | - | - | - | ||||||||||||||||||||||
Tax adjustments |
- | - | - | - | 61 | - | 61 | |||||||||||||||||||||||
Total notable items |
$ | - | $ | (10 | ) | $ | 23 | $ | - | $ | 61 | $ | - | $ | 61 | |||||||||||||||
EMEA
|
||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
Actuarial assumption review and other insurance adjustments |
$ | - | $ | 10 | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
Tax adjustments |
- | - | 14 | - | - | - | - | |||||||||||||||||||||||
Total notable items |
$ | - | $ | 10 | $ | 14 | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
CORPORATE & OTHER
|
||||||||||||||||||||||||||||||
For the Three Months Ended | For the Year-to-Date Period Ended | |||||||||||||||||||||||||||||
Unaudited (In millions) | June 30, 2014 | September 30, 2014 | December 31, 2014 | March 31, 2015 | June 30, 2015 | June 30, 2014 | June 30, 2015 | |||||||||||||||||||||||
Variable investment income, as compared to plan |
$ | - | $ | (7 | ) | $ | - | $ | - | $ | - | $ | 21 | $ | - | |||||||||||||||
Litigation reserves & settlement costs |
- | - | (117 | ) | - | - | (57 | ) | - | |||||||||||||||||||||
Tax adjustments |
- | (6 | ) | - | - | - | - | - | ||||||||||||||||||||||
Total notable items |
$ | - | $ | (13 | ) | $ | (117 | ) | $ | - | $ | - | $ | (36 | ) | $ | - | |||||||||||||
(1) Notable items represent a positive (negative) impact to operating earnings available to common shareholders. |
|
A-3
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A-9
Exhibit 99.3
Description of Video Second Quarter 2015 Financial Update
From Chief Financial Officer John Hele
This exhibit (video transcript and slides) contains forward-looking statements. Forward-looking statements give expectations or forecasts of future events and use words such as anticipate, estimate, expect, project and other terms of similar meaning, or are tied to future periods. Any or all forward-looking statements may turn out to be wrong, and actual results could differ materially from those expressed or implied in the forward-looking statements. Predictions of future performance are inherently difficult and are subject to numerous risks and uncertainties, including those identified in the Risk Factors section of MetLife, Inc.s filings with the U.S. Securities and Exchange Commission. The company is not required to publicly correct or update any forward-looking statement if it later becomes aware that such statement is not likely to be achieved.
This exhibit (video transcript and slides) also contains information regarding the sales activity for various products, as well as measures that are not calculated based on accounting principles generally accepted in the United States of America, also known as GAAP. Information regarding such sales statistics, those non-GAAP financial measures and the reconciliations of the non-GAAP financial measures to the most directly comparable GAAP measures is provided in the companys second quarter 2015 Financial Supplement, and/or the companys earnings news release dated July 29, 2015 for the three months ended June 30, 2015. Each of the Financial Supplement, the news release, and this exhibit (video transcript and slides) accompany one another as they are each exhibits to the companys Current Report on Form 8-K, dated July 29, 2015.
Video Transcript and Description:
[MetLife Executive Vice President & CFO John Hele speaks from a conference room in MetLifes GTO facility in Cary, NC]
Hi, Im John Hele and Im joining you from MetLifes new 26-acre Global Technology Campus in Cary, North Carolina, which celebrated its grand opening one month ago. [Footage of campus and ribbon cutting]
This state-of-the-art facilitybuilt over the past two yearshouses the MetLife associates and infrastructure that help us deliver world-class service to our customers. [Time-lapse footage of building construction]
On this campus, there are 190 conference rooms, 3 telepresence rooms, a 550-person outdoor amphitheater and a 92-seat auditorium. [Footage of employees interacting and facility]
And whether its in a think pod, at a treadmill desk, or even out on the great lawn, our associates have the tools they need to stay connected, innovate and excel. [Footage of rooms]
As part of our commitment to sustainability, this Cary facility is a leader in environmental design and uses 30% less energy, 40% less water and features multiple recycling points throughout the campus. [Footage of facility exterior and recycling/water conservation signage]
But MetLifes presence goes well beyond the footprint of our new campus.
Since 2013, The MetLife Foundation has been making an impact on the community here in North Carolina. In addition, consistent with MetLifes vision to build a diverse and inclusive workforce, we have special outreach programs to hire veterans and those who have taken a pause in their careers. [Images of employees volunteering in community]
We believe that technology and innovation will have a positive impact on our bottom line and this new center will help us to achieve it.
Turning now to our second quarter results
MetLife had second quarter operating earnings of $1.8 billion, up 11 percent from the second quarter of 2014. Operating earnings on a per share basis were $1.56, up 12 percent from the prior year period. [Shows slide 1 below]
Our net income was $1.0 billion in the quarter, including $593 million after tax in net derivative losses, mainly due to rising interest rates, as well as weakening of the U.S. dollar against certain currencies. This loss is driven by asymmetrical accounting, as our financial statements do not reflect the economic changes in the risks these derivatives hedge. [Shows slide 2 below]
In the Americas, operating earnings were $1.4 billion, up 4 percent on a reported basis and up 6 percent on a constant currency basis, driven by investment and underwriting margins, as well as business growth. [Shows slides 3 and 4 below]
In Asia, operating earnings for the second quarter were $425 million, up 31 percent on a reported basis, and up 45 percent on a constant currency basis. This includes a one-time tax rate change in Japan. Excluding this tax item, operating earnings were up 24 percent on a constant currency basis, reflecting strong business growth. Total sales for the region increased 1 percent on a constant currency basis, due to growth in Japan and continued strong growth in accident & health sales across the region, offset by a decline in retirement sales. [Shows slides 5 and 6 below]
And in EMEA, operating earnings were $50 million, down 31 percent on a reported basis, and down 7 percent on a constant currency basis. Second quarter 2014 results were aided by $7 million in tax-related items. Total sales in EMEA increased 7 percent on a constant currency basis, driven by employee benefit and accident & health sales. [Shows slides 7 and 8 below]
Finally, book value per share was $50.73, up 4 percent year over year. [Shows slide 9 below]
As a global company, we remain focused on delivering innovative solutions for our customers. This new campus will be an important part of our efforts to deliver a world-class customer experience and, in turn, enhance shareholder value.
Thank you for watching. [Shows slide 10 below]
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