METLIFE(R)
SECOND QUARTER
FINANCIAL SUPPLEMENT
JUNE 30, 2006
2
[METLIFE LOGO]
(METLIFE(R) LOGO)
TABLE OF CONTENTS
HIGHLIGHTS
CORPORATE OVERVIEW 2
METLIFE, INC.
CONSOLIDATED BALANCE SHEETS 3
CONSOLIDATED STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON
SHAREHOLDERS 4
CONSOLIDATING BALANCE SHEET 5
CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON
SHAREHOLDERS 6
SUMMARY OF SEGMENT OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 10
INSTITUTIONAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 11
PREMIUMS, FEES AND OTHER REVENUES BY PRODUCT AND ADDITIONAL STATISTICAL
INFORMATION 15
FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES AND
SEPARATE ACCOUNT LIABILITIES 16
OTHER EXPENSES BY MAJOR CATEGORY 17
SPREADS BY PRODUCT 18
INDIVIDUAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 19
PREMIUMS AND DEPOSITS BY PRODUCT 24
ADDITIONAL STATISTICAL INFORMATION 25
FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES AND
SEPARATE ACCOUNT LIABILITIES 26
INSURANCE EXPENSES AND OTHER EXPENSES BY MAJOR CATEGORY 27
SPREADS BY PRODUCT 28
AUTO & HOME OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 29
WRITTEN PREMIUMS BY PRODUCT AND SELECTED FINANCIAL INFORMATION AND
SUPPLEMENTAL DATA 33
INTERNATIONAL OPERATIONS
STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 34
REINSURANCE OPERATIONS
STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 35
PRE-TAX AND PRE-MINORITY INTEREST OPERATING EARNINGS BY REGION AND
RESERVES BY REGION 36
CORPORATE, OTHER & ELIMINATIONS
STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 37
METLIFE, INC.
INVESTMENT RESULTS BY ASSET CATEGORY AND ANNUALIZED YIELDS 38
FIXED MATURITIES AND EQUITY SECURITIES GROSS UNREALIZED GAINS AND LOSSES
AGING SCHEDULES 40
SUMMARY OF REAL ESTATE AND SUMMARY OF MORTGAGES AND CONSUMER LOANS 41
OTHER INFORMATION
COMPANY RATINGS 42
NOTE:
The Quarterly Financial Supplement ("QFS") includes financial measures,
operating earnings, operating earnings available to common shareholders and
operating earnings available to common shareholders per diluted common share,
that are not based on generally accepted accounting principles ("GAAP").
Operating earnings is defined as GAAP net income excluding net investment gains
and losses, net of income taxes, adjustments related to net investment gains and
losses, net of income taxes and discontinued operations other than discontinued
real estate, net of income taxes. Scheduled settlement payments on derivative
instruments not qualifying for hedge accounting treatment are included in
operating earnings. Operating earnings available to common shareholders is
defined as operating earnings less preferred stock dividends, which are recorded
in Corporate & Other. Operating earnings available to common shareholders per
diluted common share is calculated by dividing operating earnings available to
common shareholders by the number of weighted average diluted common shares
outstanding for the period indicated. MetLife believes these measures enhance
the understanding and comparability of its performance by excluding net
investment gains and losses, net of income taxes, and adjustments related to net
investment gains and losses, net of income taxes, both of which can fluctuate
significantly from period to period and discontinued operations other than
discontinued real estate, net of income taxes, thereby highlighting the results
from operations and the underlying profitability drivers of the business.
Operating earnings, operating earnings available to common shareholders and
operating earnings available to common shareholders per diluted common share
should not be viewed as substitutes for GAAP net income, GAAP net income
available to common shareholders and GAAP net income available to common
shareholders per diluted common share, respectively. Reconciliations of
operating earnings to GAAP net income, operating earnings available to common
shareholders to GAAP net income available to common shareholders and operating
earnings available to common shareholders per diluted common share to GAAP net
income available to common shareholders per diluted common share, the most
directly comparable GAAP measures, are included in the QFS and in MetLife's
earnings press release dated July 31, 2006, for the quarter ended June 30, 2006,
which are available at www.metlife.com.
1
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CORPORATE OVERVIEW
Unaudited (Dollars and shares in millions, except per share data)
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Net income $2,245 $ 773 $ 709 $ 747 $ 650
Preferred stock dividends 0 31 32 33 33
------ ------ ------ ------ ------
Net income available to common shareholders 2,245 742 677 714 617
Net investment gains (losses) 2,225 (23) (234) (624) (817)
Minority interest - net investment gains
(losses) (2) (1) 3 (2) 4
Net investment gains (losses) tax benefit
(provision) (784) 9 85 220 289
------ ------ ------ ------ ------
Net investment gains (losses), net of income
taxes (1) (2) 1,439 (15) (146) (406) (524)
Adjustments related to universal life and
investment-type product policy fees 0 0 0 (3) (9)
Adjustments related to policyholder
benefits and dividends (86) (55) (9) 108 84
Adjustments related to other expenses (9) 7 30 42 126
Adjustments related to tax benefit
(provision) 32 18 (9) (52) (72)
------ ------ ------ ------ ------
Adjustments related to net investment gains
(losses), net of income taxes (3) (63) (30) 12 95 129
Discontinued operations, net of income taxes (1) 7 12 0 30
------ ------ ------ ------ ------
Operating earnings available to common
shareholders (4) $ 870(6) $ 780(7) $ 799 $1,025 $ 982
====== ====== ====== ====== ======
Net income available to common shareholders
per common share - diluted $ 3.02 $ 0.97 $ 0.88 $ 0.93 $ 0.80
Net investment gains (losses), net of income
taxes 1.94 (0.02) (0.20) (0.53) (0.69)
Adjustments related to net investment gains
(losses), net of income taxes (0.09) (0.03) 0.02 0.13 0.17
Discontinued operations, net of income taxes 0.00 0.01 0.02 0.00 0.04
------ ------ ------ ------ ------
Operating earnings available to common
shareholders - diluted $ 1.17 $ 1.01 $ 1.04 $ 1.33 $ 1.28
====== ====== ====== ====== ======
Weighted average common shares outstanding -
diluted 743.1 768.7 769.0 768.8 769.9
Book value per common share (actual common
shares outstanding) $35.60 $35.29 $35.72 $34.98 $33.77
Book value per common share, excluding
accumulated other comprehensive income
(actual common shares outstanding) $31.41 $32.81 $33.20 $34.21 $35.08
Book value per common share - diluted
(weighted average common shares
outstanding) $35.16 $34.75 $35.19 $34.50 $33.30
Book value per common share, excluding
accumulated other comprehensive income -
diluted (weighted average common shares
outstanding) $31.02 $32.32 $32.70 $33.73 $34.59
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Common shares outstanding, beginning of
period 733.1 733.9 757.1 757.5 758.2
Treasury stock 0.8 23.2 0.4 0.7 1.0
----- ----- ----- ----- -----
Common shares outstanding, end of period 733.9 757.1 757.5 758.2 759.2
Weighted average common shares outstanding -
basic 736.5 759.8 761.1 762.0 763.1
Dilutive effect of stock options 6.4 8.6 7.7 6.5 6.5
Dilutive effect of LTPCP shares 0.2 0.3 0.2 0.3 0.3
----- ----- ----- ----- -----
Weighted average common shares outstanding -
diluted 743.1 768.7 769.0 768.8 769.9
===== ===== ===== ===== =====
Policyholder Trust Shares 310.9 307.8 298.8 294.0 285.3
SUPPLEMENTAL DATA
Adjusted long-term debt to total capital (5) 29.4% 28.3% 28.6% 28.5% 27.8%
(1) Net investment gains (losses), net of income taxes, excludes scheduled
settlement payments on derivative instruments not qualifying for hedge
accounting treatment of $8 million, $17 million, $23 million, $25 million
and $44 million for the three months ended June 30, 2005, September 30,
2005, December 31, 2005, March 31, 2006, and June 30, 2006, respectively.
For QFS purposes, these settlements are included in net investment income.
(2) Net investment gains (losses), net of income taxes, from real estate and
real estate joint ventures includes discontinued operations of $1,227
million, $30 million, $100 million, ($3) million and ($2) million, for the
three months ended June 30, 2005, September 30, 2005, December 31, 2005,
March 31, 2006, and June 30, 2006, respectively.
(3) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of unearned revenue and deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and amounts
allocable to certain participating contracts.
(4) Presentation of operating earnings available to common shareholders
throughout the QFS differs from other public filings with respect to
discontinued operations and scheduled settlement payments on derivatives
not qualifying for hedge accounting treatment. Presentation of discontinued
operations in other public filings is in accordance with the Statement of
Financial Accounting Standards ("SFAS") No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets. Presentation of scheduled
settlement payments on derivatives not qualifying for hedge accounting
treatment in other public filings is in accordance with SFAS No.133,
Accounting for Derivative Instruments and Hedging Activities.
(5) Adjusted long-term debt at June 30, 2005, September 30, 2005, December 31,
2005, March 31, 2006 and June 30, 2006, consists of $8,319 million, $8,297
million, $8,017 million, $8,028 million and $8,112 million of long-term
debt, respectively, $2,134 million, $2,134 million, $2,134 million, $2,134
million and $2,134 million of junior subordinated debt securities
underlying common equity units, respectively, and $115 million, $272
million, $878 million, $1,084 million and $926 million of adjusted
short-term debt, respectively. Non-recourse debt not included in adjusted
long-term debt consists of $985 million, $1,195 million, $1,871 million,
$1,904 million and $2,625 million at such dates, respectively. Non-core
borrowings not included in adjusted short-term debt consist of $1,864
million, $1,031 million, $536 million, $276 million and $1,326 million at
such dates, respectively. Total capital is defined as adjusted long-term
debt, shares subject to mandatory redemption and stockholders' equity net
of accumulated other comprehensive income.
(6) Operating earnings available to common shareholders for the three months
ended June 30, 2005 includes a $30 million benefit, net of income taxes
($0.04 per diluted common share), associated with the reduction of a
previously established liability for settlement death benefits related to
the Company's sales practices class action settlement recorded in 1999, an
$18 million benefit, net of income taxes ($0.02 per diluted common share),
associated with the reduction of a previously established liability related
to the Company's demutualization in 2000, and an $8 million charge, net of
income taxes ($0.01 per diluted common share), associated with an
establishment of a liability associated with the Argentine pension
business.
(7) Operating earnings available to common shareholders for the three months
ended September 30, 2005 includes a $31 million benefit ($0.04 per diluted
common share) from a revision of the estimate of income taxes for 2004.
2
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METLIFE, INC.
CONSOLIDATED BALANCE SHEETS
As of
---------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- ---------
ASSETS
Fixed maturities, at fair value $184,830 $232,041 $230,875 $240,711 $ 237,612
Equity securities, at fair value 2,531 3,058 3,338 3,356 3,202
Mortgage and consumer loans 33,586 36,094 37,190 37,351 38,665
Policy loans 8,975 9,841 9,981 9,987 10,065
Real estate and real estate joint ventures 3,998 4,705 4,665 4,700 4,786
Other limited partnership interests 3,383 4,345 4,276 4,514 4,805
Short-term investments 2,169 4,481 3,306 3,368 4,067
Other invested assets 6,452 7,877 8,078 8,386 9,652
-------- -------- -------- -------- ---------
TOTAL INVESTMENTS 245,924 302,442 301,709 312,373 312,854
Cash and cash equivalents 13,601 6,950 4,018 5,144 4,126
Accrued investment income 2,450 3,299 3,036 3,145 3,275
Premiums and other receivables 7,821 14,391 12,186 12,731 13,216
Deferred policy acquisition costs and value of
business acquired 14,865 19,211 19,641 20,245 20,814
Assets of subsidiaries held-for-sale 33 0 0 0 0
Current income tax recoverable 0 0 0 0 154
Goodwill 614 4,564 4,797 4,797 4,913
Other assets 6,758 8,017 8,389 8,145 8,171
Separate account assets 89,459 124,044 127,869 132,522 132,782
-------- -------- -------- -------- ---------
TOTAL ASSETS $381,525 $482,918 $481,645 $499,102 $ 500,305
======== ======== ======== ======== =========
LIABILITIES AND EQUITY
LIABILITIES
Future policy benefits $103,175 $121,591 $123,204 $122,748 $ 123,802
Policyholder account balances 90,080 127,431 128,312 129,860 130,518
Other policyholder funds 7,650 8,521 8,331 8,620 8,721
Policyholder dividends payable 939 978 917 918 961
Policyholder dividend obligation 2,477 1,735 1,607 814 176
Short-term debt 1,979 1,303 1,414 1,360 2,253
Long-term debt 9,389 9,576 9,888 10,782 10,737
Junior subordinated debt securities underlying
common equity units 2,134 2,134 2,134 2,134 2,134
Shares subject to mandatory redemption 278 278 278 278 278
Liabilities of subsidiaries held-for-sale 28 0 0 0 0
Current income tax payable 635 97 69 88 0
Deferred income tax payable 3,201 1,456 1,706 1,199 485
Payables for collateral under securities
loaned and other transactions 31,632 40,127 34,515 47,059 46,612
Other liabilities 10,298 14,890 12,300 12,153 13,165
Separate account liabilities 89,459 124,044 127,869 132,522 132,782
-------- -------- -------- -------- ---------
TOTAL LIABILITIES 353,354 454,161 452,544 470,535 472,624
-------- -------- -------- -------- ---------
EQUITY
Preferred stock, at par value 1 1 1 1 1
Common stock, at par value 8 8 8 8 8
Additional paid-in capital 16,974 17,273 17,274 17,327 17,372
Retained earnings 9,841 10,582 10,865 11,579 12,196
Treasury stock (1,733) (981) (959) (938) (905)
Accumulated other comprehensive income 3,080 1,874 1,912 590 (991)
-------- -------- -------- -------- ---------
TOTAL STOCKHOLDERS' EQUITY 28,171 28,757 29,101 28,567 27,681
-------- -------- -------- -------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $381,525 $482,918 $481,645 $499,102 $ 500,305
======== ======== ======== ======== =========
3
(METLIFE(R) LOGO)
METLIFE, INC.
CONSOLIDATED STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
For the Three Months Ended
-----------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
REVENUES
Premiums $ 6,034 $ 6,514 $ 6,346 $ 6,428 $ 6,428
Universal life and investment-type product policy fees 813 1,112 1,112 1,178 1,194
Investment income, net 3,508 4,112 4,167 4,278 4,277
Other revenues 301 348 323 328 335
------- ------- ------- ------- -------
10,656 12,086 11,948 12,212 12,234
------- ------- ------- ------- -------
EXPENSES
Policyholder benefits and dividends 6,589 7,208 6,897 6,934 6,840
Interest credited to policyholder account balances 820 1,156 1,167 1,220 1,269
Interest credited to bank deposits 25 30 37 43 48
Interest expense 125 183 185 198 202
Other expenses 1,844 2,408 2,487 2,297 2,425
------- ------- ------- ------- -------
9,403 10,985 10,773 10,692 10,784
------- ------- ------- ------- -------
Operating earnings before provision (benefit) for income taxes 1,253 1,101 1,175 1,520 1,450
Provision for income taxes 383 290 344 462 435
------- ------- ------- ------- -------
Operating earnings 870 811 831 1,058 1,015
Preferred stock dividends 0 31 32 33 33
------- ------- ------- ------- -------
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $ 870(2) $ 780(3) $ 799 $ 1,025 $ 982
======= ======= ======= ======= =======
NET INCOME RECONCILIATION
Operating earnings available to common shareholders $ 870 $ 780 $ 799 $ 1,025 $ 982
Net investment gains (losses) 2,225 (23) (234) (624) (817)
Minority interest - net investment gains (losses) (2) (1) 3 (2) 4
Net investment gains (losses) tax benefit (provision) (784) 9 85 220 289
------- ------- ------- ------- -------
Net investment gains (losses), net of income taxes 1,439 (15) (146) (406) (524)
Adjustments related to universal life and
investment-type product policy fees 0 0 0 (3) (9)
Adjustments related to policyholder benefits and dividends (86) (55) (9) 108 84
Adjustments related to other expenses (9) 7 30 42 126
Adjustments related to tax benefit (provision) 32 18 (9) (52) (72)
------- ------- ------- ------- -------
Adjustments related to net investment gains (losses), net of
income taxes (1) (63) (30) 12 95 129
Discontinued operations, net of income taxes (1) 7 12 0 30
------- ------- ------- ------- -------
Net income available to common shareholders 2,245 742 677 714 617
Preferred stock dividends 0 31 32 33 33
------- ------- ------- ------- -------
Net income $ 2,245 $ 773 $ 709 $ 747 $ 650
======= ======= ======= ======= =======
(1) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of unearned revenue and deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and amounts
allocable to certain participating contracts.
(2) Operating earnings available to common shareholders for the three months
ended June 30, 2005 includes a $30 million benefit, net of income taxes,
associated with the reduction of a previously established liability for
settlement death benefits related to the Company's sales practices class
action settlement recorded in 1999, an $18 million benefit, net of income
taxes, associated with the reduction of a previously established liability
related to the Company's demutualization in 2000, and an $8 million charge,
net of income taxes, associated with an establishment of a liability
associated with the Argentine pension business.
(3) Operating earnings available to common shareholders for the three months
ended September 30, 2005 includes a $31 million benefit from a revision of
the estimate of income taxes for 2004.
4
(METLIFE(R) LOGO)
METLIFE, INC.
CONSOLIDATING BALANCE SHEET
AT JUNE 30, 2006
Corporate, Other
Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations
------------ ------------- ---------- ----------- ------------- ----------- ----------------
ASSETS
Total investments $312,854 $129,696 $122,488 $3,773 $13,906 $12,929 $30,062
Cash and cash equivalents 4,126 (956) 959 (108) (118) 187 4,162
Accrued investment income 3,275 1,116 1,288 60 180 81 550
Premiums and other receivables 13,216 3,606 3,134 902 805 1,243 3,526
Deferred policy
acquisition costs and value of
business acquired 20,814 1,328 14,307 184 1,960 3,019 16
Current income tax recoverable 154 (114) 27 34 86 (91) 212
Goodwill 4,913 982 2,971 157 295 96 412
Other assets 8,171 1,856 3,364 376 356 80 2,139
Separate account assets 132,782 45,328 85,184 0 2,255 15 0
-------- -------- -------- ------ ------- ------- -------
Total Assets $500,305 $182,842 $233,722 $5,378 $19,725 $17,559 $41,079
======== ======== ======== ====== ======= ======= =======
LIABILITIES AND EQUITY
LIABILITIES
Future policy benefits $123,802 $ 48,637 $ 56,192 $3,422 $ 7,251 $ 4,861 $ 3,439
Policyholder account balances 130,518 56,469 58,232 0 5,357 5,807 4,653
Other policyholder funds 8,721 2,750 2,767 39 1,113 1,878 174
Policyholder dividends payable 961 0 961 0 0 0 0
Policyholder dividend obligation 176 0 176 0 0 0 0
Short-term debt 2,253 0 2 0 0 0 2,251
Long-term debt 10,737 1 145 0 53 1,552 8,986
Junior subordinated debt
securities underlying common
equity units 2,134 0 0 0 0 0 2,134
Shares subject to
mandatory redemption 278 0 0 0 0 159 119
Deferred income tax payable 485 (1,705) 1,364 (6) 65 749 18
Payables for collateral under
securities loaned and
other transactions 46,612 19,732 16,732 111 0 0 10,037
Other liabilities 13,165 3,187 2,953 689 900 1,430 4,006
Separate account liabilities 132,782 45,328 85,184 0 2,255 15 0
-------- -------- -------- ------ ------- ------- -------
Total Liabilities 472,624 174,399 224,708 4,255 16,994 16,451 35,817
EQUITY
Preferred stock, at par value 1 0 0 0 0 0 1
Common stock, at par value 8 0 0 0 0 0 8
Allocated equity (1) 29,568 8,935 9,405 1,051 2,623 972 6,582
Treasury stock (905) 0 0 0 0 0 (905)
Accumulated other
comprehensive income (991) (492) (391) 72 108 136 (424)
-------- -------- -------- ------ ------- ------- -------
Total Stockholders' Equity 27,681 8,443 9,014 1,123 2,731 1,108 5,262
-------- -------- -------- ------ ------- ------- -------
Total Liabilities and
Stockholders' Equity $500,305 $182,842 $233,722 $5,378 $19,725 $17,559 $41,079
======== ======== ======== ====== ======= ======= =======
(1) Allocated equity includes additional paid-in capital and retained earnings.
5
(METLIFE(R) LOGO)
METLIFE, INC.
CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
FOR THE THREE MONTHS ENDED JUNE 30, 2006
Corporate, Other
Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations
------------ ------------- ---------- ----------- ------------- ----------- ----------------
REVENUES
Premiums $ 6,428 $2,836 $1,102 $ 726 $ 676 $1,078 $ 10
Universal life and
investment-type product
policy fees 1,194 201 799 0 194 0 0
Investment income, net 4,277 1,824 1,709 42 238 156 308
Other revenues 335 169 135 8 4 13 6
------- ------ ------ ----- ------ ------ -----
12,234 5,030 3,745 776 1,112 1,247 324
------- ------ ------ ----- ------ ------ -----
EXPENSES
Policyholder benefits
and dividends 6,840 3,169 1,755 432 600 871 13
Interest credited to
policyholder account balances 1,269 617 518 0 86 48 0
Capitalization of deferred
policy acquisition costs (890) (62) (415) (119) (145) (149) 0
Amortization of deferred policy
acquisition costs 611 43 289 115 78 85 1
Other expenses 2,954 578 1,060 215 413 347 341
------- ------ ------ ----- ------ ------ -----
10,784 4,345 3,207 643 1,032 1,202 355
------- ------ ------ ----- ------ ------ -----
Operating earnings before
provision (benefit) for
income taxes 1,450 685 538 133 80 45 (31)
Provision (benefit) for
income taxes 435 232 185 34 18 16 (50)
------- ------ ------ ----- ------ ------ -----
Operating earnings 1,015 453 353 99 62 29 19
Preferred stock dividends 33 0 0 0 0 0 33
------- ------ ------ ----- ------ ------ -----
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 982 $ 453 $ 353 $ 99 $ 62 $ 29 ($14)
======= ====== ====== ===== ====== ====== =====
NET INCOME RECONCILIATION
Operating earnings available to
common shareholders $ 982 $ 453 $ 353 $ 99 $ 62 $ 29 ($14)
Net investment gains (losses) (817) (440) (307) (4) 13 (15) (64)
Minority interest - net
investment gains (losses) 4 0 0 0 0 4 0
Net investment gains (losses)
tax benefit (provision) 289 157 108 4 (5) 4 21
------- ------ ------ ----- ------ ------ -----
Net investment gains (losses),
net of income taxes (524) (283) (199) 0 8 (7) (43)
Adjustments related to
universal life and
investment-type product
policy fees (9) 0 (9) 0 0 0 0
Adjustments related to
policyholder benefits
and dividends 84 61 (26) 0 49 0 0
Adjustments related to
other expenses 126 0 118 0 0 8 0
Adjustments related to tax
benefit (provision) (72) (22) (29) 0 (18) (3) 0
------- ------ ------ ----- ------ ------ -----
Adjustments related to net
investment gains (losses),
net of income taxes (1) 129 39 54 0 31 5 0
Discontinued operations, net of
income taxes 30 0 0 0 0 0 30
------- ------ ------ ----- ------ ------ -----
Net income available to
common shareholders 617 209 208 99 101 27 (27)
Preferred stock dividends 33 0 0 0 0 0 33
------- ------ ------ ----- ------ ------ -----
Net income $ 650 $ 209 $ 208 $ 99 $ 101 $ 27 $ 6
======= ====== ====== ===== ====== ====== =====
(1) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of unearned revenue and deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and amounts
allocable to certain participating contracts.
6
(METLIFE(R) LOGO)
METLIFE, INC.
CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS (1)
FOR THE THREE MONTHS ENDED JUNE 30, 2005
Auto Corporate, Other
Unaudited (Dollars in millions) Consolidated Institutional Individual & Home International Reinsurance & Eliminations
------------ ------------- ---------- ------ ------------- ----------- ----------------
REVENUES
Premiums $ 6,034 $2,834 $1,061 $ 738 $ 470 $ 928 $ 3
Universal life and investment-type
product policy fees 813 185 501 0 125 2 0
Investment income, net 3,508 1,364 1,571 46 195 137 195
Other revenues 301 163 105 8 (1) 21 5
------- ------ ------ ----- ----- ------ ------
10,656 4,546 3,238 792 789 1,088 203
------- ------ ------ ----- ----- ------ ------
EXPENSES
Policyholder benefits and dividends 6,589 3,159 1,732 448 468 828 (46)
Interest credited to policyholder
account balances 820 326 395 0 55 43 1
Capitalization of deferred policy
acquisition costs (858) (68) (279) (119) (138) (254) 0
Amortization of deferred policy
acquisition costs 556 39 169 115 56 175 2
Other expenses 2,296 566 786 208 274 293 169
------- ------ ------ ----- ----- ------ ------
9,403 4,022 2,803 652 715 1,085 126
------- ------ ------ ----- ----- ------ ------
Operating earnings before provision
(benefit) for income taxes 1,253 524 435 140 74 3 77
Provision (benefit) for income
taxes 383 178 145 39 23 (1) (1)
------- ------ ------ ----- ----- ------ ------
Operating earnings 870 346 290 101 51 4 78
Preferred stock dividends 0 0 0 0 0 0 0
------- ------ ------ ----- ----- ------ ------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 870 $ 346 $ 290 $ 101 $ 51 $ 4 $ 78
======= ====== ====== ===== ===== ====== ======
NET INCOME RECONCILIATION
Operating earnings available to
common shareholders $ 870 $ 346 $ 290 $ 101 $ 51 $ 4 $ 78
Net investment gains (losses) 2,225 415 501 (4) 7 (7) 1,313
Minority interest - net
investment gains (losses) (2) 0 0 0 0 (2) 0
Net investment gains (losses)
tax benefit (provision) (784) (147) (174) 1 (2) 6 (468)
------- ------ ------ ----- ----- ------ ------
Net investment gains (losses), net
of income taxes 1,439 268 327 (3) 5 (3) 845
Adjustments related to universal
life and investment-type product
policy fees 0 0 0 0 0 0 0
Adjustments related to
policyholder benefits and
dividends (86) (37) (33) 0 (16) 0 0
Adjustments related to other
expenses (9) 0 (21) 0 0 12 0
Adjustments related to tax
benefit (provision) 32 13 19 0 6 (6) 0
------- ------ ------ ----- ----- ------ ------
Adjustments related to net
investment gains (losses), net
of income taxes (2) (63) (24) (35) 0 (10) 6 0
Discontinued operations, net of
income taxes (1) 0 0 0 (1) 0 0
------- ------ ------ ----- ----- ------ ------
Net income available to common
shareholders 2,245 590 582 98 45 7 923
Preferred stock dividends 0 0 0 0 0 0 0
------- ------ ------ ----- ----- ------ ------
Net income $ 2,245 $ 590 $ 582 $ 98 $ 45 $ 7 $ 923
======= ====== ====== ===== ===== ====== ======
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
(2) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of unearned revenue and deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and amounts
allocable to certain participating contracts.
7
(METLIFE(R) LOGO)
METLIFE, INC.
CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
FOR THE SIX MONTHS ENDED JUNE 30, 2006
Auto Corporate, Other
Unaudited (Dollars in millions) Consolidated Institutional Individual & Home International Reinsurance & Eliminations
------------ ------------- ---------- ------ ------------- ----------- ----------------
REVENUES
Premiums $12,856 $ 5,825 $2,184 $1,450 $1,307 $2,071 $ 19
Universal life and investment-type
product policy fees 2,372 402 1,592 0 378 0 0
Investment income, net 8,555 3,611 3,450 87 473 330 604
Other revenues 663 339 260 15 8 28 13
------- ------- ------ ------ ------ ------ -----
24,446 10,177 7,486 1,552 2,166 2,429 636
------- ------- ------ ------ ------ ------ -----
EXPENSES
Policyholder benefits and dividends 13,774 6,558 3,500 885 1,127 1,684 20
Interest credited to policyholder
account balances 2,489 1,211 994 0 173 111 0
Capitalization of deferred policy
acquisition costs (1,773) (143) (785) (224) (296) (325) 0
Amortization of deferred policy
acquisition costs 1,255 78 591 226 160 199 1
Other expenses 5,731 1,157 2,024 410 809 679 652
------- ------- ------ ------ ------ ------ -----
21,476 8,861 6,324 1,297 1,973 2,348 673
------- ------- ------ ------ ------ ------ -----
Operating earnings before provision
(benefit) for income taxes 2,970 1,316 1,162 255 193 81 (37)
Provision (benefit) for income
taxes 897 447 401 63 56 28 (98)
------- ------- ------ ------ ------ ------ -----
Operating earnings 2,073 869 761 192 137 53 61
Preferred stock dividends 66 0 0 0 0 0 66
------- ------- ------ ------ ------ ------ -----
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 2,007 $ 869 $ 761 $ 192 $ 137 $ 53 ($5)
======= ======= ====== ====== ====== ====== =====
NET INCOME RECONCILIATION
Operating earnings available to
common shareholders $ 2,007 $ 869 $ 761 $ 192 $ 137 $ 53 ($5)
Net investment gains (losses) (1,441) (779) (572) (3) 33 (7) (113)
Minority interest - net
investment gains (losses) 2 0 0 0 0 2 0
Net investment gains (losses)
tax benefit (provision) 509 277 203 1 (11) 2 37
------- ------- ------ ------ ------ ------ -----
Net investment gains (losses), net
of income taxes (930) (502) (369) (2) 22 (3) (76)
Adjustments related to universal
life and investment-type
product policy fees (12) 0 (12) 0 0 0 0
Adjustments related to
policyholder benefits and
dividends 192 86 35 0 71 0 0
Adjustments related to other
expenses 168 0 163 0 0 5 0
Adjustments related to tax
benefit (provision) (124) (31) (66) 0 (25) (2) 0
------- ------- ------ ------ ------ ------ -----
Adjustments related to net
investment gains (losses), net
of income taxes (1) 224 55 120 0 46 3 0
Discontinued operations, net of
income taxes 30 0 0 0 0 0 30
------- ------- ------ ------ ------ ------ -----
Net income available to common
shareholders 1,331 422 512 190 205 53 (51)
Preferred stock dividends 66 0 0 0 0 0 66
------- ------- ------ ------ ------ ------ -----
Net income $ 1,397 $ 422 $ 512 $ 190 $ 205 $ 53 $ 15
======= ======= ====== ====== ====== ====== =====
(1) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of unearned revenue and deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and amounts
allocable to certain participating contracts.
8
(METLIFE(R) LOGO)
METLIFE, INC.
CONSOLIDATING STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON
SHAREHOLDERS(1)
FOR THE SIX MONTHS ENDED JUNE 30, 2005
Corporate,
Other
Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations
------------ ------------- ---------- ----------- ------------- ----------- --------------
REVENUES
Premiums $ 12,000 $ 5,678 $ 2,085 $ 1,466 $ 936 $ 1,831 $ 4
Universal life and
investment-type
product policy fees 1,604 378 980 0 244 2 0
Investment income, net 6,787 2,612 3,109 89 344 287 346
Other revenues 600 324 217 17 2 32 8
-------- ------- ------- ------- ------- ------- -------
20,991 8,992 6,391 1,572 1,526 2,152 358
-------- ------- ------- ------- ------- ------- -------
EXPENSES
Policyholder benefits and
dividends 13,000 6,305 3,367 926 878 1,567 (43)
Interest credited to policyholder
account balances 1,615 627 787 0 102 99 0
Capitalization of deferred policy
acquisition costs (1,625) (132) (533) (222) (263) (475) 0
Amortization of deferred policy
acquisition costs 1,084 74 351 226 112 317 4
Other expenses 4,482 1,105 1,504 399 518 603 353
-------- ------- ------- ------- ------- ------- -------
18,556 7,979 5,476 1,329 1,347 2,111 314
-------- ------- ------- ------- ------- ------- -------
Operating earnings before
provision (benefit)
for income taxes 2,435 1,013 915 243 179 41 44
Provision (benefit) for
income taxes 743 343 305 66 60 12 (43)
Operating earnings 1,692 670 610 177 119 29 87
Preferred stock dividends 0 0 0 0 0 0 0
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 1,692 $ 670 $ 610 $ 177 $ 119 $ 29 $ 87
======== ======= ======= ======= ======= ======= =======
NET INCOME RECONCILIATION
Operating earnings available to
common shareholders $ 1,692 $ 670 $ 610 $ 177 $ 119 $ 29 $ 87
Net investment gains (losses) 2,204 420 560 (4) 7 21 1,200
Minority interest - net
investment gains (losses) (11) 0 (4) 0 0 (7) 0
Net investment gains (losses)
tax benefit (provision) (775) (150) (197) 1 (2) (2) (425)
-------- ------- ------- ------- ------- ------- -------
Net investment gains (losses),
net of income taxes 1,418 270 359 (3) 5 12 775
Adjustments related to
universal life and
investment-type product
policy fees 0 0 0 0 0 0 0
Adjustments related to
policyholder benefits
and dividends (16) (2) (12) 0 (2) 0 0
Adjustments related to other
expenses (24) 0 (19) 0 0 (5) 0
Adjustments related to tax
benefit (provision) 13 1 11 0 1 0 0
-------- ------- ------- ------- ------- ------- -------
Adjustments related to net
investment gains (losses),
net of income taxes(2) (27) (1) (20) 0 (1) (5) 0
Discontinued operations, net of
income taxes 149 0 0 0 (2) 0 151
-------- ------- ------- ------- ------- ------- -------
Net income available to common
shareholders 3,232 939 949 174 121 36 1,013
Preferred stock dividends 0 0 0 0 0 0 0
-------- ------- ------- ------- ------- ------- -------
Net income $ 3,232 $ 939 $ 949 $ 174 $ 121 $ 36 $ 1,013
======== ======= ======= ======= ======= ======= =======
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
(2) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of unearned revenue and deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and amounts
allocable to certain participating contracts.
9
(METLIFE(R) LOGO)
SUMMARY OF SEGMENT OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS (1)
For the Three Months Ended
----------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
INSTITUTIONAL OPERATIONS $346 $386 $389 $ 416 $453
INDIVIDUAL OPERATIONS 290 330 312 408 353
AUTO & HOME OPERATIONS 101 (26) 81 93 99
INTERNATIONAL OPERATIONS 51 66 48 75 62
REINSURANCE OPERATIONS 4 26 31 24 29
CORPORATE, OTHER & ELIMINATIONS 78 (2) (62) 9 (14)
---- ---- ---- ------ ----
CONSOLIDATED $870(2) $780(3) $799 $1,025 $982
==== ==== ==== ====== ====
(1) A reconciliation of operating earnings available to common shareholders to
net income for each segment appears in this QFS as follows: (i)
Institutional Operations, page 11; (ii) Individual Operations, page 19;
(iii) Auto & Home Operations, page 29; (iv) International Operations, page
34; (v) Reinsurance Operations, page 35; and Corporate, Other &
Eliminations, page 37. A reconciliation of operating earnings available to
common shareholders to net income for MetLife, Inc., Consolidated, appears
on page 4.
(2) Operating earnings available to common shareholders for the three months
ended June 30, 2005 includes a $30 million benefit, net of income taxes,
associated with the reduction of a previously established liability for
settlement death benefits related to the Company's sales practices class
action settlement recorded in 1999, an $18 million benefit, net of income
taxes, associated with the reduction of a previously established liability
related to the Company's demutualization in 2000, and an $8 million charge,
net of income taxes, associated with an establishment of a liability
associated with the Argentine pension business.
(3) Operating earnings available to common shareholders for the three months
ended September 30, 2005 includes a $31 million benefit from a revision of
the estimate of income taxes for 2004.
10
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS - TOTAL
UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date
For the Three Months Ended Period Ended
---------------------------------------------------------- --------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Institutional Operations 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $2,834 $3,066 $2,643 $2,989 $2,836 $5,678 $ 5,825
Universal life and investment-type product
policy fees 185 197 197 201 201 378 402
Investment income, net 1,364 1,707 1,732 1,787 1,824 2,612 3,611
Other revenues 163 163 166 170 169 324 339
------ ------ ------ ------ ------ ------ -------
4,546 5,133 4,738 5,147 5,030 8,992 10,177
------ ------ ------ ------ ------ ------ -------
EXPENSES
Policyholder benefits and dividends 3,159 3,455 3,025 3,389 3,169 6,305 6,558
Interest credited to policyholder account
balances 326 508 530 594 617 627 1,211
Other expenses 537 587 595 533 559 1,047 1,092
------ ------ ------ ------ ------ ------ -------
4,022 4,550 4,150 4,516 4,345 7,979 8,861
------ ------ ------ ------ ------ ------ -------
Operating earnings before provision
(benefit) for income taxes 524 583 588 631 685 1,013 1,316
Provision (benefit) for income taxes 178 197 199 215 232 343 447
------ ------ ------ ------ ------ ------ -------
OPERATING EARNINGS AVAILABLE TO COMMON
SHAREHOLDERS $ 346 $ 386 $ 389 $ 416 $ 453 $ 670 $ 869
====== ====== ====== ====== ====== ====== =======
NET INCOME RECONCILIATION
Operating earnings available to common
shareholders $ 346 $ 386 $ 389 $ 416 $ 453 $ 670 $ 869
Net investment gains (losses) 415 (97) (156) (339) (440) 420 (779)
Minority interest - net investment gains
(losses) 0 0 0 0 0 0 0
Net investment gains (losses) tax
benefit (provision) (147) 36 59 120 157 (150) 277
------ ------ ------ ------ ------ ------ -------
Net investment gains (losses), net of
income taxes 268 (61) (97) (219) (283) 270 (502)
Adjustments related to universal life
and investment-type product policy
fees 0 0 0 0 0 0 0
Adjustments related to policyholder
benefits and dividends (37) 28 (18) 25 61 (2) 86
Adjustments related to other expenses 0 0 0 0 0 0 0
Adjustments related to tax benefit
(provision) 13 (10) 6 (9) (22) 1 (31)
------ ------ ------ ------ ------ ------ -------
Adjustments related to net investment gains
(losses), net of income taxes(1) (24) 18 (12) 16 39 (1) 55
Discontinued operations, net of income
taxes 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ -------
Net income available to common shareholders 590 343 280 213 209 939 422
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ -------
Net income $ 590 $ 343 $ 280 $ 213 $ 209 $ 939 $ 422
====== ====== ====== ====== ====== ====== =======
(1) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of deferred policy acquisition costs and amounts
allocable to certain participating contracts.
11
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS -
PRODUCT LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date
For the Three Months Ended Period Ended
---------------------------------------------------------- --------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Group Life 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $1,435 $1,485 $1,359 $1,551 $1,474 $2,799 $3,025
Universal life and investment-type product
policy fees 180 192 194 195 197 367 392
Investment income, net 281 296 296 303 309 552 612
Other revenues 14 11 10 15 13 27 28
------ ------ ------ ------ ------ ------ ------
1,910 1,984 1,859 2,064 1,993 3,745 4,057
------ ------ ------ ------ ------ ------ ------
EXPENSES
Policyholder benefits and dividends 1,519 1,542 1,398 1,636 1,484 2,963 3,120
Interest credited to policyholder account
balances 105 119 125 134 143 204 277
Other expenses 159 168 157 155 157 305 312
------ ------ ------ ------ ------ ------ ------
1,783 1,829 1,680 1,925 1,784 3,472 3,709
------ ------ ------ ------ ------ ------ ------
Operating earnings before provision
(benefit) for income taxes 127 155 179 139 209 273 348
Provision (benefit) for income taxes 44 53 61 48 70 93 118
------ ------ ------ ------ ------ ------ ------
OPERATING EARNINGS AVAILABLE TO COMMON
SHAREHOLDERS $ 83 $ 102 $ 118 $ 91 $ 139 $ 180 $ 230
====== ====== ====== ====== ====== ====== ======
Net investment gains (losses), net of
income taxes (1) 7 (38) (2) (47) (10) (49)
Adjustments related to net investment gains
(losses), net of income taxes 0 4 1 1 3 0 4
Discontinued operations, net of income
taxes 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income available to common shareholders 82 113 81 90 95 170 185
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income $ 82 $ 113 $ 81 $ 90 $ 95 $ 170 $ 185
====== ====== ====== ====== ====== ====== ======
12
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS -
PRODUCT LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
-------------------------------------------------------------- -------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Retirement & Savings 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 384 $ 557 $ 234 $ 334 $ 254 $ 880 $ 588
Universal life and investment-type
product policy fees 5 5 3 6 4 11 10
Investment income, net 926 1,255 1,273 1,325 1,361 1,772 2,686
Other revenues 59 63 67 62 64 118 126
------ ------ ------ ------ ------ ------ ------
1,374 1,880 1,577 1,727 1,683 2,781 3,410
------ ------ ------ ------ ------ ------ ------
EXPENSES
Policyholder benefits and dividends 751 1,041 743 774 755 1,615 1,529
Interest credited to policyholder
account balances 221 389 405 460 474 423 934
Other expenses 87 126 113 98 119 180 217
------ ------ ------ ------ ------ ------ ------
1,059 1,556 1,261 1,332 1,348 2,218 2,680
------ ------ ------ ------ ------ ------ ------
Operating earnings before provision
(benefit) for income taxes 315 324 316 395 335 563 730
Provision (benefit) for income taxes 106 108 106 134 114 189 248
------ ------ ------ ------ ------ ------ ------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 209 $ 216 $ 210 $ 261 $ 221 $ 374 $ 482
====== ====== ====== ====== ====== ====== ======
Net investment gains (losses), net
of income taxes 231 (45) (61) (168) (187) 243 (355)
Adjustments related to net
investment gains (losses), net of
income taxes (10) 7 (2) (7) 10 1 3
Discontinued operations, net of
income taxes 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income available to common
shareholders 430 178 147 86 44 618 130
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income $ 430 $ 178 $ 147 $ 86 $ 44 $ 618 $ 130
====== ====== ====== ====== ====== ====== ======
13
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS -
PRODUCT LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
-------------------------------------------------------------- -------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Non-Medical Health & Other 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $1,015 $1,024 $1,050 $1,104 $1,108 $1,999 $2,212
Universal life and investment-type
product policy fees 0 0 0 0 0 0 0
Investment income, net 157 156 163 159 154 288 313
Other revenues 90 89 89 93 92 179 185
------ ------ ------ ------ ------ ------ ------
1,262 1,269 1,302 1,356 1,354 2,466 2,710
------ ------ ------ ------ ------ ------ ------
EXPENSES
Policyholder benefits and dividends 889 872 884 979 930 1,727 1,909
Interest credited to policyholder
account balances 0 0 0 0 0 0 0
Other expenses 291 293 325 280 283 562 563
------ ------ ------ ------ ------ ------ ------
1,180 1,165 1,209 1,259 1,213 2,289 2,472
------ ------ ------ ------ ------ ------ ------
Operating earnings before provision
(benefit) for income taxes 82 104 93 97 141 177 238
Provision (benefit) for income taxes 28 36 32 33 48 61 81
------ ------ ------ ------ ------ ------ ------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 54 $ 68 $ 61 $ 64 $ 93 $ 116 $ 157
====== ====== ====== ====== ====== ====== ======
Net investment gains (losses), net
of income taxes 38 (23) 2 (49) (49) 37 (98)
Adjustments related to net
investment gains (losses), net of
income taxes (14) 7 (11) 22 26 (2) 48
Discontinued operations, net of
income taxes 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income available to common
shareholders 78 52 52 37 70 151 107
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income $ 78 $ 52 $ 52 $ 37 $ 70 $ 151 $ 107
====== ====== ====== ====== ====== ====== ======
14
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
PREMIUMS, FEES AND OTHER REVENUES BY PRODUCT
AND ADDITIONAL STATISTICAL INFORMATION
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
PREMIUMS, FEES AND OTHER REVENUES BY
PRODUCT (1)
Group Life $1,629 $1,688 $1,563 $1,761 $1,684
Retirement & Savings 448 625 304 402 322
Non-Medical Health & Other 1,105 1,113 1,139 1,197 1,200
------ ------ ------ ------ ------
Total Premiums, Fees and Other Revenues $3,182 $3,426 $3,006 $3,360 $3,206
====== ====== ====== ====== ======
Group Disability (Included in Non-Medical
Health & Other) $ 331 $ 325 $ 335 $ 347 $ 342
ADDITIONAL STATISTICAL INFORMATION
INCURRED LOSS RATIO (MORTALITY EXPERIENCE):
Term Life 94.7% 91.5% 89.3% 94.2% 88.1%
INCURRED LOSS RATIO (MORBIDITY EXPERIENCE):
Group Disability 83.5% 95.0% 91.1% 90.7% 90.2%
NUMBER OF SALES REPRESENTATIVES 778 787 761 745 700
(1) With respect to premiums, fees and other revenues, certain experience
rating refunds and changes to premium stabilization reserves are included
in premiums and fees. The following table excludes these amounts:
Group Life $1,633 $1,699 $1,655 $1,694 $1,669
Retirement & Savings 448 625 304 402 322
Non-Medical Health & Other 1,104 1,116 1,146 1,197 1,207
------ ------ ------ ------ ------
Total Premiums, Fees and Other Revenues $3,185 $3,440 $3,105 $3,293 $3,198
------ ------ ------ ------ ------
15
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES AND SEPARATE ACCOUNT
LIABILITIES
UNAUDITED (DOLLARS IN MILLIONS)
FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Group Life 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $15,354 $15,449 $16,290 $16,400 $16,951
Premiums and deposits 2,921 2,921 2,681 3,372 2,824
Interest on reserves 144 159 166 176 187
Surrenders and withdrawals (1,324) (1,263) (1,180) (1,196) (1,581)
Benefits and reserves (1,519) (1,295) (1,397) (1,623) (1,489)
Other (127) 319(1) (160) (178) (206)
------- ------- ------- ------- -------
Balance, end of period $15,449 $16,290 $16,400 $16,951 $16,686
======= ======= ======= ======= =======
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Retirement & Savings 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $49,233 $51,020 $77,933 $78,405 $78,252
Premiums and deposits 2,122 2,751 3,282 3,819 3,028
Interest on reserves 650 933 937 986 1,022
Surrenders and withdrawals (1,786) (2,604) (2,378) (2,851) (2,301)
Benefits and reserves (508) (671) (655) (679) (673)
Other 1,309 26,504(1) (714) (1,428) 78
------- ------- ------- ------- -------
Balance, end of period $51,020 $77,933 $78,405 $78,252 $79,406
======= ======= ======= ======= =======
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Non-Medical Health & Other 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $7,721 $7,968 $8,321 $8,556 $8,849
Premiums and deposits 978 996 1,023 1,066 1,059
Interest on reserves 66 74 76 78 81
Surrenders and withdrawals 23 21 20 20 28
Benefits and reserves (880) (917) (915) (991) (950)
Other 60 179(1) 31 120 (53)
------ ------ ------ ------ ------
Balance, end of period $7,968 $8,321 $8,556 $8,849 $9,014
====== ====== ====== ====== ======
SEPARATE ACCOUNT LIABILITIES
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Group Life 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $7,976 $8,050 $ 9,931 $10,539 $10,949
Premiums and deposits 120 232 706 189 603
Investment performance 40 219 29 329 (161)
Surrenders and withdrawals (86) (108) (121) (101) (86)
Policy charges 0 (7) (7) (7) (7)
Other 0 1,545(1) 1 0 (4)
------ ------ ------- ------- -------
Balance, end of period $8,050 $9,931 $10,539 $10,949 $11,294
====== ====== ======= ======= =======
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Retirement & Savings 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $30,654 $32,105 $34,508 $34,374 $33,653
Premiums and deposits 965 1,108 1,204 1,345 1,127
Investment performance 1,890 538 527 550 279
Surrenders and withdrawals (1,351) (2,029) (1,775) (2,592) (1,377)
Policy charges (26) (23) (30) (25) (26)
Other (27) 2,809(1) (60) 1 1
------- ------- ------- ------- -------
Balance, end of period $32,105 $34,508 $34,374 $33,653 $33,657
======= ======= ======= ======= =======
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Non-Medical Health & Other 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $ 243 $276 $298 $ 326 $360
Premiums and deposits 85 81 78 90 91
Investment performance 191 66 (34) 90 (48)
Surrenders and withdrawals (23) (21) (19) (20) (28)
Policy charges (18) (18) (15) (14) (20)
Other (202) (86) 18 (112) 22
----- ---- ---- ----- ----
Balance, end of period $ 276 $298 $326 $ 360 $377
===== ==== ==== ===== ====
(1) Includes the beginning balances of Travelers of $771 million, $27,661
million and $347 million for Group Life, Retirement & Savings and
Non-Medical Health & Other, respectively, in Future Policy Benefits and
Policyholder Account Balances and $1,545 million and $2,428 million for
Group Life and Retirement & Savings, respectively, in Separate Account
Liabilities.
16
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
OTHER EXPENSES BY MAJOR CATEGORY
For the Three Months Ended
----------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
OTHER EXPENSES BY MAJOR CATEGORY
Direct and allocated expenses $396 $417 $431 $361 $413
Pension and other post-retirement benefit
costs 18 19 19 21 20
Premium taxes and other taxes, licenses
and fees 41 46 53 50 38
---- ---- ---- ---- ----
Sub-total Insurance Expenses 455 482 503 432 471
Commissions and other expenses 82 105 92 101 88
---- ---- ---- ---- ----
Total Other Expenses $537 $587 $595 $533 $559
==== ==== ==== ==== ====
17
(METLIFE(R) LOGO)
INSTITUTIONAL OPERATIONS
SPREADS BY PRODUCT
UNAUDITED
For the Three Months Ended
----------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Group Life 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
ANNUALIZED GENERAL ACCOUNT SPREADS BY
SEGMENT (%)
Investment income yield 5.86% 5.89% 5.98% 6.07% 6.11%
Average crediting rate 3.78% 3.92% 4.07% 4.40% 4.56%
---- ---- ---- ---- ----
Spread 2.08% 1.97% 1.91% 1.67% 1.55%
==== ==== ==== ==== ====
For the Three Months Ended
----------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Retirement & Savings 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
ANNUALIZED GENERAL ACCOUNT
SPREADS BY SEGMENT (%)
Investment income yield 7.66% 6.57% 6.59% 6.74% 6.83%
Average crediting rate 5.51% 4.97% 5.11% 5.31% 5.33%
---- ---- ---- ---- ----
Spread 2.15% 1.60% 1.48% 1.43% 1.50%
==== ==== ==== ==== ====
For the Three Months Ended
----------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Non-Medical Health & Other 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
ANNUALIZED GENERAL ACCOUNT
SPREADS BY SEGMENT (%)
Investment income yield 9.17% 8.19% 8.25% 7.71% 7.22%
Average crediting rate 4.94% 4.93% 4.95% 4.99% 5.00%
---- ---- ---- ---- ----
Spread 4.23% 3.26% 3.30% 2.72% 2.22%
==== ==== ==== ==== ====
18
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS - TOTAL (1)
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
------------------------------------------------------ -----------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Individual Operations 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $1,061 $1,136 $1,264 $1,082 $1,102 $2,085 $2,184
Universal life and investment-type product policy
fees 501 746 750 793 799 980 1,592
Investment income, net 1,571 1,751 1,711 1,741 1,709 3,109 3,450
Other revenues 105 150 110 125 135 217 260
------ ------ ------ ------ ------ ------ ------
3,238 3,783 3,835 3,741 3,745 6,391 7,486
------ ------ ------ ------ ------ ------ ------
EXPENSES
Policyholder benefits and dividends 1,732 1,769 1,940 1,745 1,755 3,367 3,500
Interest credited to policyholder account balances 395 500 488 476 518 787 994
Capitalization of deferred policy acquisition costs (279) (384) (409) (370) (415) (533) (785)
Amortization of deferred policy acquisition costs 169 310 303 302 289 351 591
Other expenses 786 1,094 1,047 964 1,060 1,504 2,024
------ ------ ------ ------ ------ ------ ------
2,803 3,289 3,369 3,117 3,207 5,476 6,324
------ ------ ------ ------ ------ ------ ------
Operating earnings before provision (benefit) for
income taxes 435 494 466 624 538 915 1,162
Provision (benefit) for income taxes 145 164 154 216 185 305 401
------ ------ ------ ------ ------ ------ ------
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $ 290 $ 330 $ 312 $ 408 $ 353 $ 610 $ 761
====== ====== ====== ====== ====== ====== ======
NET INCOME RECONCILIATION
Operating earnings available to common shareholders $ 290 $ 330 $ 312 $ 408 $ 353 $ 610 $ 761
Net investment gains (losses) 501 (6) (180) (265) (307) 560 (572)
Minority interest - net investment gains
(losses) 0 0 0 0 0 (4) 0
Net investment gains (losses) tax benefit
(provision) (174) 0 65 95 108 (197) 203
------ ------ ------ ------ ------ ------ ------
Net investment gains (losses), net of income taxes 327 (6) (115) (170) (199) 359 (369)
Adjustments related to universal life and
investment-type product policy fees 0 0 0 (3) (9) 0 (12)
Adjustments related to policyholder benefits and
dividends (33) (29) 30 61 (26) (12) 35
Adjustments related to other expenses (21) 11 31 45 118 (19) 163
Adjustments related to tax benefit (provision) 19 7 (22) (37) (29) 11 (66)
------ ------ ------ ------ ------ ------ ------
Adjustments related to net investment gains
(losses), net of income taxes (2) (35) (11) 39 66 54 (20) 120
Discontinued operations, net of income taxes 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income available to common shareholders 582 313 236 304 208 949 512
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income $ 582 $ 313 $ 236 $ 304 $ 208 $ 949 $ 512
====== ====== ====== ====== ====== ====== ======
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
(2) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of unearned revenue and deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and amounts
allocable to certain participating contracts.
19
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS - PRODUCT
LEVEL (1)
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
------------------------------------------------------ -----------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Traditional Life 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 988 $1,016 $1,134 $ 976 $1,011 $1,949 $1,987
Universal life and investment-type product policy
fees 0 0 0 0 0 0 0
Investment income, net 832 838 815 821 804 1,674 1,625
Other revenues 0 1 1 0 (1) 2 (1)
------ ------ ------ ------ ------ ------ ------
1,820 1,855 1,950 1,797 1,814 3,625 3,611
------ ------ ------ ------ ------ ------ ------
EXPENSES
Policyholder benefits and dividends 1,522 1,467 1,648 1,444 1,463 2,968 2,907
Interest credited to policyholder account balances 0 0 0 0 0 0 0
Capitalization of deferred policy acquisition costs (60) (47) (53) (56) (52) (103) (108)
Amortization of deferred policy acquisition costs 48 58 46 53 45 100 98
Other expenses 207 228 222 207 213 390 420
------ ------ ------ ------ ------ ------ ------
1,717 1,706 1,863 1,648 1,669 3,355 3,317
------ ------ ------ ------ ------ ------ ------
Operating earnings before provision (benefit) for
income taxes 103 149 87 149 145 270 294
Provision (benefit) for income taxes 36 50 30 51 48 92 99
------ ------ ------ ------ ------ ------ ------
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $ 67 $ 99 $ 57 $ 98 $ 97 $ 178 $ 195
====== ====== ====== ====== ====== ====== ======
Net investment gains (losses), net of income taxes 224 31 15 (44) (48) 269 (92)
Adjustments related to net investment gains
(losses), net of income taxes (22) (22) 20 40 19 (7) 59
Discontinued operations, net of income taxes 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income available to common shareholders 269 108 92 94 68 440 162
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income $ 269 $ 108 $ 92 $ 94 $ 68 $ 440 $ 162
====== ====== ====== ====== ====== ====== ======
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
20
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS -
PRODUCT LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
---------------------------------------------------------- ------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Variable & Universal Life 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Universal life and investment-type
product policy fees 277 384 382 395 384 542 779
Investment income, net 151 196 190 203 197 303 400
Other revenues (3) 0 (1) (3) 0 (3) (3)
---- ----- ----- ----- ----- ----- ------
425 580 571 595 581 842 1,176
---- ----- ----- ----- ----- ----- ------
EXPENSES
Policyholder benefits and dividends 97 120 120 123 162 190 285
Interest credited to policyholder
account balances 117 145 146 142 144 231 286
Capitalization of deferred policy
acquisition costs (72) (133) (136) (102) (110) (137) (212)
Amortization of deferred policy
acquisition costs 64 105 113 110 104 113 214
Other expenses 160 266 275 208 214 308 422
---- ----- ----- ----- ----- ----- ------
366 503 518 481 514 705 995
---- ----- ----- ----- ----- ----- ------
Operating earnings before provision
(benefit) for income taxes 59 77 53 114 67 137 181
Provision (benefit) for income taxes 20 26 18 40 24 47 64
---- ----- ----- ----- ----- ----- ------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 39 $ 51 $ 35 $ 74 $ 43 $ 90 $ 117
==== ===== ===== ===== ===== ===== ======
Net investment gains (losses), net
of income taxes 9 (12) (22) (25) (36) 1 (61)
Adjustments related to net
investment gains (losses), net of
income taxes (2) 7 10 9 6 (4) 15
Discontinued operations, net of
income taxes 0 0 0 0 0 0 0
---- ----- ----- ----- ----- ----- ------
Net income available to common
shareholders 46 46 23 58 13 87 71
Preferred stock dividends 0 0 0 0 0 0 0
---- ----- ----- ----- ----- ----- ------
Net income $ 46 $ 46 $ 23 $ 58 $ 13 $ 87 $ 71
==== ===== ===== ===== ===== ===== ======
21
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS -
PRODUCT LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
------------------------------------------------------------------- -------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Annuities 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 73 $ 118 $ 101 $ 98 $ 85 $ 136 $ 183
Universal life and investment-type
product policy fees 198 318 334 356 367 383 723
Investment income, net 551 681 665 677 667 1,062 1,344
Other revenues 13 26 29 29 36 24 65
----- ------ ------ ------ ------ ------ ------
835 1,143 1,129 1,160 1,155 1,605 2,315
----- ------ ------ ------ ------ ------ ------
EXPENSES
Policyholder benefits and dividends 113 178 152 173 125 209 298
Interest credited to policyholder
account balances 260 338 322 314 351 521 665
Capitalization of deferred policy
acquisition costs (147) (204) (220) (212) (253) (292) (465)
Amortization of deferred policy
acquisition costs 57 147 144 139 140 138 279
Other expenses 292 427 422 400 477 551 877
----- ------ ------ ------ ------ ------ ------
575 886 820 814 840 1,127 1,654
----- ------ ------ ------ ------ ------ ------
Operating earnings before provision
(benefit) for income taxes 260 257 309 346 315 478 661
Provision (benefit) for income taxes 85 84 100 120 109 156 229
----- ------ ------ ------ ------ ------ ------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 175 $ 173 $ 209 $ 226 $ 206 $ 322 $ 432
===== ====== ====== ====== ====== ====== ======
Net investment gains (losses), net
of income taxes 94 (29) (99) (102) (105) 95 (207)
Adjustments related to net
investment gains (losses), net of
income taxes (11) 4 9 17 29 (9) 46
Discontinued operations, net of
income taxes 0 0 0 0 0 0 0
----- ------ ------ ------ ------ ------ ------
Net income available to common
shareholders 258 148 119 141 130 408 271
Preferred stock dividends 0 0 0 0 0 0 0
----- ------ ------ ------ ------ ------ ------
Net income $ 258 $ 148 $ 119 $ 141 $ 130 $ 408 $ 271
===== ====== ====== ====== ====== ====== ======
22
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS -
PRODUCT LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
------------------------------------------------------ -----------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Other 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 0 $ 2 $ 29 $ 8 $ 6 $ 0 $ 14
Universal life and investment-type product
policy fees 26 44 34 42 48 55 90
Investment income, net 37 36 41 40 41 70 81
Other revenues 95 123 81 99 100 194 199
---- ---- ---- ---- ---- ---- ----
158 205 185 189 195 319 384
---- ---- ---- ---- ---- ---- ----
EXPENSES
Policyholder benefits and dividends 0 4 20 5 5 0 10
Interest credited to policyholder account balances 18 17 20 20 23 35 43
Capitalization of deferred policy acquisition costs 0 0 0 0 0 (1) 0
Amortization of deferred policy acquisition costs 0 0 0 0 0 0 0
Other expenses 127 173 128 149 156 255 305
---- ---- ---- ---- ---- ---- ----
145 194 168 174 184 289 358
---- ---- ---- ---- ---- ---- ----
Operating earnings before provision (benefit) for
income taxes 13 11 17 15 11 30 26
Provision (benefit) for income taxes 4 4 6 5 4 10 9
---- ---- ---- ---- ---- ---- ----
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $ 9 $ 7 $ 11 $ 10 $ 7 $ 20 $ 17
==== ==== ==== ==== ==== ==== ====
Net investment gains (losses), net of income taxes 0 4 (9) 1 (10) (6) (9)
Adjustments related to net investment gains
(losses), net of income taxes 0 0 0 0 0 0 0
Discontinued operations, net of income taxes 0 0 0 0 0 0 0
---- ---- ---- ---- ---- ---- ----
Net income available to common shareholders 9 11 2 11 (3) 14 8
Preferred stock dividends 0 0 0 0 0 0 0
---- ---- ---- ---- ---- ---- ----
Net income $ 9 $ 11 $ 2 $ 11 ($3) $ 14 $ 8
==== ==== ==== ==== ==== ==== ====
23
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
PREMIUMS AND DEPOSITS BY PRODUCT
For the Three Months Ended
----------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
PREMIUMS AND DEPOSITS BY PRODUCT (1)
TOTAL (2)
Life First Year Premiums and Deposits
Traditional Life $ 52 $ 52 $ 54 $ 50 $ 50
Variable Life 1st Year excluding Single Premium COLI/BOLI 41 56 63 50 55
Universal Life 1st Year excluding Single Premium COLI/BOLI 110 245 228 203 177
Single Premium COLI/BOLI 10 4 15 6 6
------ ------ ------ ------ ------
Total Life First Year Premiums & Deposits (3) 213 357 360 309 288
Life Renewal Premiums and Deposits
Traditional Life 1,020 1,033 1,227 959 1,049
Variable & Universal Life 416 532 551 600 515
Annuities (4) 2,496 3,624 3,570 3,843 4,229
------ ------ ------ ------ ------
Total Premiums and Deposits $4,145 $5,546 $5,708 $5,711 $6,081
====== ====== ====== ====== ======
PREMIUMS AND DEPOSITS TO SEPARATE ACCOUNTS
Variable & Universal Life $ 246 $ 297 $ 307 $ 283 $ 276
Annuities 1,503 2,306 2,479 2,532 2,928
------ ------ ------ ------ ------
Total Separate Accounts $1,749 $2,603 $2,786 $2,815 $3,204
====== ====== ====== ====== ======
ANNUITY DEPOSITS BY TYPE
Fixed Annuity Deposits $ 356 $ 496 $ 464 $ 520 $ 430
Variable Annuity Deposits 2,140 3,128 3,106 3,323 3,799
------ ------ ------ ------ ------
Total Annuity Deposits $2,496 $3,624 $3,570 $3,843 $4,229
====== ====== ====== ====== ======
(1) Statutory premiums direct and assumed.
(2) Includes premiums and deposits to separate accounts and excludes Company
sponsored internal exchanges.
(3) Of the $288 million of First Year Life Premiums and Deposits received
during the three months ended June 30, 2006, approximately 44% were
distributed through MetLife agents, 15% through New England Financial
agents, 38% through MetLife's Independent Distribution channel and 3%
through other distribution channels.
(4) Of the $4,229 million of Annuity Deposits received during the three months
ended June 30, 2006, approximately 22% were distributed through MetLife
agents, 6% through New England Financial agents, 61% through MetLife's
Independent Distribution channel and 11% through MetLife Resources
representatives.
24
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
ADDITIONAL STATISTICAL INFORMATION
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
PERCENTAGE OF PREMIUMS AND DEPOSITS TO
SEPARATE ACCOUNTS,
EXCLUDING TRANSFERS FROM GENERAL ACCOUNT:
Variable & Universal Life 41.4% 33.4% 33.6% 31.3% 33.8%
Annuities 60.2% 63.6% 69.4% 65.9% 69.2%
MORTALITY AS A PERCENTAGE OF EXPECTED 84.7% 86.4% 84.9% 94.0% 85.1%
LAPSES / SURRENDERS (GENERAL AND SEPARATE
ACCOUNT) (1)
Traditional Life 6.1% 6.1% 6.0% 6.0% 5.9%
Variable & Universal Life 6.3% 6.2% 6.1% 6.3% 6.0%
Variable Annuities 7.7% 8.4% 8.9% 9.5% 10.0%
Fixed Annuities 5.8% 6.4% 8.0% 8.7% 9.6%
NUMBER OF SALES REPRESENTATIVES
MetLife Distribution 5,773 5,774 5,804 5,954 6,002
New England Financial 2,255 2,228 2,006 2,068 2,071
Independent Distribution Wholesalers 124 279 229 220 217
MetLife Resources 428 857 794 751 739
Walnut Street and Tower Square Securities 1,263 1,869 1,676 1,632 1,564
P&C Specialists 617 672 682 658 657
------ ------ ------ ------ ------
Total Agents 10,460 11,679 11,191 11,283 11,250
====== ====== ====== ====== ======
(1) Lapses/Surrenders rates are calculated for the most recent 12 months of
experience.
25
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES AND SEPARATE ACCOUNT
LIABILITIES
UNAUDITED (DOLLARS IN MILLIONS)
FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES
For the Three Months Ended
------------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Traditional Life 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $49,371 $49,582 $50,562 $50,944 $50,977
Premiums and deposits (1) 1,066 1,101 1,239 1,061 1,093
Interest on reserves 503 514 518 511 520
Surrenders and withdrawals (437) (443) (470) (504) (433)
Benefit payments (492) (498) (459) (572) (498)
Other (429) 306(2) (446) (463) (482)
------- ------- ------- ------- -------
Balance, end of period $49,582 $50,562 $50,944 $50,977 $51,177
======= ======= ======= ======= =======
For the Three Months Ended
--------------------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Variable & Universal Life 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $10,087 $10,154 $14,315 $14,852 $15,042
Premiums and deposits (1) (3) 320 548 567 572 482
Interest on reserves 117 151 148 142 145
Surrenders and withdrawals (160) (178) (185) (168) (171)
Net transfers from (to) separate account 55 52 45 49 48
Policy charges (231) (350) (351) (363) (364)
Benefit payments (30) (36) (34) (48) (44)
Other (4) 3,974(2) 347 6 130
------- ------- ------- ------- -------
Balance, end of period $10,154 $14,315 $14,852 $15,042 $15,268
======= ======= ======= ======= =======
For the Three Months Ended
--------------------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Annuities 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $32,304 $32,421 $46,136 $45,732 $45,293
Premiums and deposits (1) (3) 1,101 1,410 1,298 1,398 1,456
Interest on reserves 309 401 398 395 448
Surrenders and withdrawals (679) (1,014) (1,178) (1,231) (1,552)
Net transfers from (to) separate account (346) (544) (625) (621) (521)
Policy charges (3) (2) (2) (2) (2)
Benefit payments (273) (309) (297) (326) (349)
Other 8 13,773 2 (52) 2
------- ------- ------- ------- -------
Balance, end of period $32,421 $46,136 $45,732 $45,293 $44,775
======= ======= ======= ======= =======
SEPARATE ACCOUNT LIABILITIES
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Variable & Universal Life 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $ 7,747 $7,900 $9,164 $9,307 $9,769
Premiums and deposits (1) 247 297 307 283 276
Investment performance 135 318 155 492 (134)
Surrenders and withdrawals (109) (137) (177) (158) (160)
Net transfers from (to) fixed account (55) (52) (45) (51) (48)
Policy charges (65) (89) (96) (80) (110)
Other 0 927(2) (1) (24) 0
------- ------ ------ ------ ------
Balance, end of period $ 7,900 $9,164 $9,307 $9,769 $9,593
======= ====== ====== ====== ======
For the Three Months Ended
--------------------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Annuities 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Balance, beginning of period $38,051 $39,771 $69,146 $71,764 $75,861
Premiums and deposits (1) 1,503 2,306 2,479 2,532 2,928
Investment performance 806 2,701 1,507 3,255 (1,483)
Surrenders and withdrawals (796) (1,723) (1,724) (2,026) (1,947)
Net transfers from (to) fixed account 346 544 625 621 521
Policy charges (139) (266) (269) (280) (292)
Other 0 25,813(2) 0 (5) (1)
------- ------- ------- ------- -------
Balance, end of period $39,771 $69,146 $71,764 $75,861 $75,587
======= ======= ======= ======= =======
(1) Includes Company-sponsored internal exchanges.
(2) Includes the beginning balances of Travelers of $764 million, $3,952
million and $13,755 million for Traditional Life, Variable & Universal Life
and Annuities, respectively, in Future Policy Benefits and Policyholder
Account Balances and $928 million and $25,813 million for Variable &
Universal Life and Annuities, respectively, in Separate Account
Liabilities.
(3) Includes premiums and deposits directed to General Account investment
option of a variable life and variable annuity product.
26
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
INSURANCE EXPENSES AND OTHER
EXPENSES BY MAJOR CATEGORY (1)
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
INSURANCE EXPENSES (NET OF CAPITALIZATION
OF DAC)
Insurance Expenses $ 674 $ 936 $ 941 $ 830 $ 914
DAC Capitalization (2) (292) (401) (426) (384) (429)
----- ------ ------ ----- ------
Net $ 382 $ 535 $ 515 $ 446 $ 485
===== ====== ====== ===== ======
OTHER EXPENSES BY MAJOR CATEGORY
Commissions $ 206 $ 329 $ 347 $ 315 $ 350
Other deferrable expenses 113 126 140 120 146
Direct and allocated expenses, not deferred 317 422 410 334 386
Pension and other post-retirement benefit
costs 29 29 30 34 3
Premium taxes and other taxes, licenses and
fees 9 30 14 27 29
----- ------ ------ ----- ------
Subtotal Insurance Expenses 674 936 941 830 914
Broker-dealer and other expenses 132 177 132 155 159
Reinsurance allowances (20) (19) (26) (21) (13)
----- ------ ------ ----- ------
Total Other Expenses $ 786 $1,094 $1,047 $ 964 $1,060
===== ====== ====== ===== ======
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
(2) Excludes $13 million, $17 million, $17 million, $14 million and $14 million
of DAC capitalization related to reinsurance allowances for the three
months ended June 30, 2005, September 30, 2005, December 31, 2005, March
31, 2006 and June 30, 2006, respectively.
27
(METLIFE(R) LOGO)
INDIVIDUAL OPERATIONS
SPREADS BY PRODUCT
UNAUDITED
For the Three Months Ended
---------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
VARIABLE & UNIVERSAL LIFE 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
ANNUALIZED GENERAL ACCOUNT
SPREADS BY PRODUCT (%)
Investment income yield 6.85% 6.91% 6.63% 6.69% 6.41%
Average crediting rate 4.92% 4.65% 4.67% 4.56% 4.54%
---- ---- ---- ---- ----
Spread 1.93% 2.26% 1.96% 2.13% 1.87%
==== ==== ==== ==== ====
For the Three Months Ended
---------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
ANNUITIES 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
ANNUALIZED GENERAL ACCOUNT
SPREADS BY PRODUCT (%)
Investment income yield 6.62% 6.41% 6.32% 6.28% 6.28%
Average crediting rate 3.44% 3.64% 3.64% 3.65% 3.66%
---- ---- ---- ---- ----
Spread 3.18% 2.77% 2.68% 2.63% 2.62%
==== ==== ==== ==== ====
28
(METLIFE(R) LOGO)
AUTO & HOME OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS - TOTAL
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
-------------------------------------------------------------- -------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Auto & Home Operations 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Earned premiums $738 $ 716 $729 $724 $726 $1,466 $1,450
Investment income, net 46 46 46 45 42 89 87
Other revenues 8 8 8 7 8 17 15
---- ---- ---- ---- ---- ------ ------
792 770 783 776 776 1,572 1,552
---- ---- ---- ---- ---- ------ ------
EXPENSES
Losses and loss adjustment expense 448 615 454 451 432 925 883
Other expenses 204 209 218 203 211 404 414
---- ---- ---- ---- ---- ------ ------
652 824 672 654 643 1,329 1,297
---- ---- ---- ---- ---- ------ ------
Operating earnings before provision
(benefit) for income taxes 140 (54) 111 122 133 243 255
Provision (benefit) for income taxes 39 (28) 30 29 34 66 63
---- ---- ---- ---- ---- ------ ------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $101 ($26) $ 81 $ 93 $ 99 $ 177 $ 192
==== ==== ==== ==== ==== ====== ======
NET INCOME RECONCILIATION
Operating earnings available to
common shareholders $101 ($26) $ 81 $ 93 $ 99 $ 177 $ 192
Net investment gains (losses) (4) (5) (3) 1 (4) (4) (3)
Minority interest - net
investment gains (losses) 0 0 0 0 0 0 0
Net investment gains (losses)
tax benefit (provision) 1 2 1 (3) 4 1 1
---- ---- ---- ---- ---- ------ ------
Net investment gains (losses), net
of income taxes (3) (3) (2) (2) 0 (3) (2)
Adjustments related to
universal life and
investment-type product
policy fees 0 0 0 0 0 0 0
Adjustments related to
policyholder benefits and
dividends 0 0 0 0 0 0 0
Adjustments related to other
expenses 0 0 0 0 0 0 0
Adjustments related to tax
benefit (provision) 0 0 0 0 0 0 0
---- ---- ---- ---- ---- ------ ------
Adjustments related to net
investment gains (losses), net of
income taxes 0 0 0 0 0 0 0
Discontinued operations, net of
income taxes 0 0 0 0 0 0 0
---- ---- ---- ---- ---- ------ ------
Net income available to common
shareholders 98 (29) 79 91 99 174 190
Preferred stock dividends 0 0 0 0 0 0 0
---- ---- ---- ---- ---- ------ ------
Net income $ 98 ($29) $ 79 $ 91 $ 99 $ 174 $ 190
==== ==== ==== ==== ==== ====== ======
29
(METLIFE(R) LOGO)
AUTO & HOME OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS -
PRODUCT LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
Year-to-Date
For the Three Months Ended Period Ended
-------------------------------------------------------------- -------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Auto 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Earned premiums $533 $534 $525 $517 $516 $1,064 $ 1,033
Investment income, net 35 34 37 34 32 67 66
Other revenues 6 6 5 6 7 12 13
---- ---- ---- ---- ---- ------ -------
574 574 567 557 555 1,143 1,112
---- ---- ---- ---- ---- ------ -------
EXPENSES
Losses and loss adjustment expense 342 339 355 334 321 720 655
Other expenses 141 143 150 137 145 278 282
---- ---- ---- ---- ---- ------ -------
483 482 505 471 466 998 937
---- ---- ---- ---- ---- ------ -------
Operating earnings before provision
(benefit) for income taxes 91 92 62 86 89 145 175
Provision (benefit) for income taxes 24 27 13 21 21 35 42
---- ---- ---- ---- ---- ------ -------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 67 $ 65 $ 49 $ 65 $ 68 $ 110 $ 133
==== ==== ==== ==== ==== ====== =======
Net investment gains (losses), net
of income taxes (2) (2) (2) (1) 0 (2) (1)
Adjustments related to net
investment gains (losses), net of
income taxes 0 0 0 0 0 0 0
Discontinued operations, net of
income taxes 0 0 0 0 0 0 0
---- ---- ---- ---- ---- ------ -------
Net income available to common
shareholders 65 63 47 64 68 108 132
Preferred stock dividends 0 0 0 0 0 0 0
---- ---- ---- ---- ---- ------ -------
Net income $ 65 $ 63 $ 47 $ 64 $ 68 $ 108 $ 132
==== ==== ==== ==== ==== ====== =======
30
(METLIFE(R) LOGO)
AUTO & HOME OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS - PRODUCT
LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
For the Three Months Ended Year-to-Date Period Ended
------------------------------------------------------ -------------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Homeowners 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Earned premiums $193 $ 170 $192 $194 $198 $377 $392
Investment income, net 10 12 8 11 9 20 20
Other revenues 2 1 2 1 1 3 2
---- ----- ---- ---- ---- ---- ----
205 183 202 206 208 400 414
---- ----- ---- ---- ---- ---- ----
EXPENSES
Losses and loss adjustment expense 99 260 94 110 102 192 212
Other expenses 58 61 64 59 61 114 120
---- ----- ---- ---- ---- ---- ----
157 321 158 169 163 306 332
---- ----- ---- ---- ---- ---- ----
Operating earnings before provision (benefit)
for income taxes 48 (138) 44 37 45 94 82
Provision (benefit) for income taxes 15 (52) 15 9 13 30 22
---- ----- ---- ---- ---- ---- ----
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 33 ($86) $ 29 $ 28 $ 32 $ 64 $ 60
==== ===== ==== ==== ==== ==== ====
Net investment gains (losses), net of income
taxes (1) 0 (1) (1) 0 (1) (1)
Adjustments related to net
investment gains (losses), net of income
taxes 0 0 0 0 0 0 0
Discontinued operations, net of income taxes 0 0 0 0 0 0 0
---- ----- ---- ---- ---- ---- ----
Net income available to common shareholders 32 (86) 28 27 32 63 59
Preferred stock dividends 0 0 0 0 0 0 0
---- ----- ---- ---- ---- ---- ----
Net income $ 32 ($86) $ 28 $ 27 $ 32 $ 63 $ 59
==== ===== ==== ==== ==== ==== ====
31
(METLIFE(R) LOGO)
AUTO & HOME OPERATIONS
STATEMENTS OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS - PRODUCT
LEVEL
UNAUDITED (DOLLARS IN MILLIONS)
For the
For the Three Months Ended Year-to-Date Period Ended
------------------------------------------------------ -------------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Other 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Earned premiums $12 $ 12 $12 $13 $ 12 $25 $ 25
Investment income, net 1 0 1 0 1 2 1
Other revenues 0 1 1 0 0 2 0
--- ---- --- --- ---- --- ----
13 13 14 13 13 29 26
--- ---- --- --- ---- --- ----
EXPENSES
Losses and loss adjustment expense 7 16 5 7 9 13 16
Other expenses 5 5 4 7 5 12 12
--- ---- --- --- ---- --- ----
12 21 9 14 14 25 28
--- ---- --- --- ---- --- ----
Operating earnings before provision (benefit)
for income taxes 1 (8) 5 (1) (1) 4 (2)
Provision (benefit) for income taxes 0 (3) 2 (1) 0 1 (1)
--- ---- --- --- ---- --- ----
OPERATING EARNINGS AVAILABLE TO COMMON
SHAREHOLDERS $ 1 ($5) $ 3 $ 0 ($1) $ 3 ($1)
=== ==== === === ==== === ====
Net investment gains (losses), net of
income taxes 0 (1) 1 0 0 0 0
Adjustments related to net investment gains
(losses), net of income taxes 0 0 0 0 0 0 0
Discontinued operations, net of income taxes 0 0 0 0 0 0 0
--- ---- --- --- ---- --- ----
Net income available to common shareholders 1 (6) 4 0 (1) 3 (1)
Preferred stock dividends 0 0 0 0 0 0 0
--- ---- --- --- ---- --- ----
Net income $ 1 ($6) $ 4 $ 0 ($1) $ 3 ($1)
=== ==== === === ==== === ====
32
(METLIFE(R) LOGO)
AUTO & HOME OPERATIONS
WRITTEN PREMIUMS BY PRODUCT AND SELECTED FINANCIAL INFORMATION
AND SUPPLEMENTAL DATA
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
WRITTEN PREMIUMS BY PRODUCT
Preferred/Standard Automobile $ 519 $ 528 $ 492 $ 498 $ 507
Non-Standard Automobile 15 14 12 12 11
Homeowners 212 200 191 169 213
Other 12 11 9 17 13
----- ------ ----- ------ ------
Total $ 758 $ 753 $ 704 $ 696 $ 744
===== ====== ===== ====== ======
SELECTED FINANCIAL INFORMATION AND
SUPPLEMENTAL DATA
TOTAL AUTO & HOME
Loss and loss adjustment expense ratio 60.4% 85.8% 62.3% 62.4% 59.3%
Other expense ratio 27.2% 28.5% 29.2% 27.2% 28.6%
----- ------ ----- ------ ------
Total combined ratio (1) 87.6% 114.3% 91.5% 89.6% 87.9%
Effect of catastrophe losses (2) 1.2% 27.5% 8.5% 3.0% 3.4%
----- ------ ----- ------ ------
Combined ratio excluding catastrophes 86.4% 86.8% 83.0% 86.6% 84.5%
===== ====== ===== ====== ======
AUTO
Loss and loss adjustment expense ratio 63.6% 63.3% 67.6% 64.7% 62.2%
Other expense ratio 26.0% 26.0% 27.8% 25.7% 27.1%
----- ------ ----- ------ ------
Total combined ratio (1) 89.6% 89.3% 95.4% 90.4% 89.3%
Effect of catastrophe losses (2) 0.1% 2.7% 3.4% 0.8% 1.3%
----- ------ ----- ------ ------
Combined ratio excluding catastrophes 89.5% 86.6% 92.0% 89.6% 88.0%
===== ====== ===== ====== ======
HOMEOWNERS
Loss and loss adjustment expense ratio 51.4% 153.1% 48.9% 57.1% 51.5%
Other expense ratio 29.8% 35.4% 32.9% 29.3% 31.2%
----- ------ ----- ------ ------
Total combined ratio (1) 81.2% 188.5% 81.8% 86.4% 82.7%
Effect of catastrophe losses (2) 4.4% 106.3% 20.9% 8.9% 8.6%
----- ------ ----- ------ ------
Combined ratio excluding catastrophes 76.8% 82.2% 60.9% 77.5% 74.1%
===== ====== ===== ====== ======
OTHER
Loss and loss adjustment expense ratio 60.7% 127.0% 41.7% 53.2% 64.1%
Other expense ratio 38.7% 39.4% 33.3% 52.3% 46.1%
----- ------ ----- ------ ------
Total combined ratio (1) 99.4% 166.4% 75.0% 105.5% 110.2%
Effect of catastrophe losses 0.0% 0.0% 12.5% 0.0% 0.0%
----- ------ ----- ------ ------
Combined ratio excluding catastrophes 99.4% 166.4% 62.5% 105.5% 110.2%
===== ====== ===== ====== ======
PRE-TAX CATASTROPHE LOSSES
Auto $ 1 $ 13 $ 17 $ 4 $ 7
Homeowners 9 156 34 17 17
Other 0 0 2 0 0
----- ------ ----- ------ ------
Total $ 10 $ 169 $ 53 $ 21 $ 24
===== ====== ===== ====== ======
CATASTROPHE POINTS ON COMBINED RATIOS 1.2 27.5 8.5 3.0 3.4
NUMBER OF SALES REPRESENTATIVES 89 85 100 98 93
----- ------ ----- ------ ------
(1) The combined ratio reflects payment fees as a credit to Other expenses for
the three months ended June 30, 2005, September 30, 2005, December 31,
2005, March 31, 2006 and June 30, 2006, which resulted in a 0.7, 0.7, 0.7,
0.7 and 0.6 of a percentage point decrease in the combined ratio for the
periods ended, respectively. The decreases for Auto, Homeowners and Other
were 0.7, 0.4 and 0.8 of a percentage point, respectively, for June 30,
2005, 0.8, 0.5, 0.8 of a percentage point, respectively, for September 30,
2005, 0.8, 0.4 and 0.8 of a percentage point, respectively, for December
31, 2005, 0.8, 0.4 and 0.4 of a percentage point, respectively, for March
31, 2006 and 0.7, 0.4 and 0.5 of a percentage point, respectively, for June
30, 2006.
(2) Includes the effect of both catastrophe losses and $32 million in
reinstatement reinsurance premiums within Auto ($2 million) and Homeowners
($30 million) for third quarter of 2005 and $11 million in the fourth
quarter of 2005 for reinstatement reinsurance premiums within Auto ($1
million) and Homeowners ($10 million).
33
(METLIFE(R) LOGO)
INTERNATIONAL OPERATIONS
STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
For the Year-to-
For the Three Months Ended Date Period Ended
-------------------------------------------------------------- -------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 470 $ 614 $ 636 $ 631 $ 676 $ 936 $1,307
Universal life and investment-type
product policy fees 125 170 165 184 194 244 378
Investment income, net 195 238 262 235 238 344 473
Other revenues (1) 9 9 4 4 2 8
------ ------ ------ ------ ------ ------ ------
789 1,031 1,072 1,054 1,112 1,526 2,166
------ ------ ------ ------ ------ ------ ------
EXPENSES
Policyholder benefits and dividends 468 578 600 527 600 878 1,127
Interest credited to policyholder
account balances 55 84 92 87 86 102 173
Capitalization of deferred policy
acquisition costs (138) (137) (141) (151) (145) (263) (296)
Amortization of deferred policy
acquisition costs 56 68 43 82 78 112 160
Other expenses 274 359 441 396 413 518 809
------ ------ ------ ------ ------ ------ ------
715 952 1,035 941 1,032 1,347 1,973
------ ------ ------ ------ ------ ------ ------
Operating earnings before provision
(benefit) for income taxes 74 79 37 113 80 179 193
Provision (benefit) for income taxes 23 13 (11) 38 18 60 56
------ ------ ------ ------ ------ ------ ------
OPERATING EARNINGS AVAILABLE TO
COMMON SHAREHOLDERS $ 51 $ 66 $ 48 $ 75 $ 62 $ 119 $ 137
====== ====== ====== ====== ====== ====== ======
NET INCOME RECONCILIATION
Operating earnings available to
common shareholders $ 51 $ 66 $ 48 $ 75 $ 62 $ 119 $ 137
Net investment gains (losses) 7 5 (7) 20 13 7 33
Minority interest - net
investment gains (losses) 0 0 0 0 0 0 0
Net investment gains (losses) tax
benefit (provision) (2) (2) 3 (6) (5) (2) (11)
------ ------ ------ ------ ------ ------ ------
Net investment gains (losses), net
of income taxes 5 3 (4) 14 8 5 22
Adjustments related to universal
life and investment-type
product policy fees 0 0 0 0 0 0 0
Adjustments related to
policyholder benefits and
dividends (16) (54) (21) 22 49 (2) 71
Adjustments related to other
expenses 0 0 0 0 0 0 0
Adjustments related to tax
benefit (provision) 6 19 7 (7) (18) 1 (25)
------ ------ ------ ------ ------ ------ ------
Adjustments related to net
investment gains (losses), net of
income taxes (1) (10) (35) (14) 15 31 (1) 46
Discontinued operations, net of
income taxes (1) 7 0 0 0 (2) 0
------ ------ ------ ------ ------ ------ ------
Net income available to common
shareholders 45 41 30 104 101 121 205
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income $ 45 $ 41 $ 30 $ 104 $ 101 $ 121 $ 205
====== ====== ====== ====== ====== ====== ======
NUMBER OF PROFESSIONAL SALES
REPRESENTATIVES (2) 3,913 3,861 3,783 3,782 3,982
------ ------ ------ ------ ------
(1) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of deferred policy acquisition costs and amounts
allocable to certain participating contracts.
(2) Certain prior period amounts have been reclassified to conform with current
period presentation.
34
(METLIFE(R) LOGO)
REINSURANCE OPERATIONS
STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS
For the
Year-to-Date
For the Three Months Ended Period Ended
---------------------------------------------------------- -------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 930 $ 974 $1,062 $ 993 $1,078 $1,833 $2,071
Investment income, net 137 158 161 174 156 287 330
Other revenues 21 13 13 15 13 32 28
------ ------ ------ ------ ------ ------ ------
1,088 1,145 1,236 1,182 1,247 2,152 2,429
------ ------ ------ ------ ------ ------ ------
EXPENSES
Claims and other policy benefits 828 779 860 813 871 1,567 1,684
Interest credited to policyholder account
balances 43 64 57 63 48 99 111
Policy acquisition costs and other insurance
expenses 156 162 159 158 174 300 332
Other expenses 47 48 57 63 60 91 123
------ ------ ------ ------ ------ ------ ------
1,074 1,053 1,133 1,097 1,153 2,057 2,250
------ ------ ------ ------ ------ ------ ------
Operating earnings before provision (benefit)
for income taxes and minority interest 14 92 103 85 94 95 179
Provision (benefit) for income taxes (1) 16 17 12 16 12 28
------ ------ ------ ------ ------ ------ ------
Operating earnings available to common
shareholders before minority interest 15 76 86 73 78 83 151
Elimination of minority interest, before tax 11 50 55 49 49 54 98
------ ------ ------ ------ ------ ------ ------
CONTRIBUTION TO METLIFE $ 4(2) $ 26 $ 31 $ 24 $ 29 $ 29 $ 53
====== ====== ====== ====== ====== ====== ======
NET INCOME RECONCILIATION
Operating earnings available to common
shareholders $ 4 $ 26 $ 31 $ 24 $ 29 $ 29 $ 53
Net investment gains (losses) (7) 7 (6) 8 (15) 21 (7)
Minority interest - net investment gains
(losses) (2) (1) 3 (2) 4 (7) 2
Net investment gains (losses) tax benefit
(provision) 6 (2) 1 (2) 4 (2) 2
------ ------ ------ ------ ------ ------ ------
Net investment gains (losses), net of income
taxes (3) 4 (2) 4 (7) 12 (3)
Adjustments related to universal life and
investment-type product policy fees 0 0 0 0 0 0 0
Adjustments related to policyholder
benefits and dividends 0 0 0 0 0 0 0
Adjustments related to other expenses 12 (4) (1) (3) 8 (5) 5
Adjustments related to tax benefit
(provision) (6) 2 0 1 (3) 0 (2)
------ ------ ------ ------ ------ ------ ------
Adjustments related to net investment gains
(losses), net of income taxes (1) 6 (2) (1) (2) 5 (5) 3
Discontinued operations, net of income taxes 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income available to common shareholders 7 28 28 26 27 36 53
Preferred stock dividends 0 0 0 0 0 0 0
------ ------ ------ ------ ------ ------ ------
Net income $ 7 $ 28 $ 28 $ 26 $ 27 $ 36 $ 53
====== ====== ====== ====== ====== ====== ======
(1) Adjustments related to net investment gains (losses), net of income taxes,
includes amortization of deferred policy acquisition costs.
(2) Operating earnings available to common shareholders for the three months
ended June 30, 2005 includes an $8 million charge, net of income taxes,
associated with an establishment of a liability associated with the
Argentine pension business.
35
(METLIFE(R) LOGO)
REINSURANCE OPERATIONS
PRE-TAX AND PRE-MINORITY INTEREST OPERATING
EARNINGS BY REGION AND RESERVES BY REGION
For the Three Months Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
PRE-TAX AND PRE-MINORITY INTEREST
OPERATING EARNINGS BY REGION (1)
United States $ 28 $ 78 $ 80 $ 66 $ 66
Canada 17 21 20 7 9
Asia-Pacific 14 4 18 7 8
Other international markets (7) 15 12 15 17
Corporate (38) (26) (27) (10) (6)
------- ------- ------- ------- -------
Total pre-tax and pre-minority interest
operating earnings $ 14 $ 92 $ 103 $ 85 $ 94
======= ======= ======= ======= =======
POLICY BENEFITS AND INTEREST
SENSITIVE CONTRACT LIABILITIES BY REGION
Traditional U.S. $ 3,865 $ 3,966 $ 4,030 $ 4,157 $ 4,239
Asset intensive 4,267 4,497 4,657 4,773 4,911
Other 126 90 100 77 90
------- ------- ------- ------- -------
Total U.S. 8,258 8,553 8,787 9,007 9,240
------- ------- ------- ------- -------
Canada 1,389 1,507 1,596 1,622 1,780
Asia-Pacific 611 629 688 708 752
Other international markets 702 677 680 719 774
------- ------- ------- ------- -------
Total International 2,702 2,813 2,964 3,049 3,306
------- ------- ------- ------- -------
Total policy benefits and interest sensitive
contract liabilities $10,960 $11,366 $11,751 $12,056 $12,546
======= ======= ======= ======= =======
(1) Effective for the three months ended March 31, 2006, Reinsurance Group of
America Incorporated ("RGA") changed its method of allocating capital to
its regional markets from a method based on regulatory capital requirements
to one based upon underlying economic capital levels. This approach is
based upon a more detailed, internally developed risk capital model that
its management believes better captures the unique risks inherent in each
regional business. The primary effect of the change relates to the amount
of net investment income and capital charges that are allocated to each
region. This change does not affect RGA's consolidated financial results.
36
(METLIFE(R) LOGO)
CORPORATE, OTHER & ELIMINATIONS
STATEMENT OF OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS (1)
For the Year-to-
For the Three Months Ended Date Period Ended
--------------------------------------------------------- ------------------
June 30, September 30, December 31, March 31, June 30, June 30, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006 2005 2006
-------- ------------- ------------ --------- -------- -------- --------
REVENUES
Premiums $ 3 $ 6 $ 12 $ 9 $ 10 $ 4 $ 19
Universal life and investment-type product policy
fees 0 1 0 0 0 0 0
Investment income, net 195 212 255 296 308 346 604
Other revenues 5 5 17 7 6 8 13
------ ---- ----- ----- ----- ------ -----
203 224 284 312 324 358 636
------ ---- ----- ----- ----- ------ -----
EXPENSES
Policyholder benefits and dividends (46) 12 16 7 13 (43) 20
Interest credited to policyholder account balances 1 0 0 0 0 0 0
Interest credited to bank deposits 25 30 37 43 48 42 91
Interest expense 110 166 171 175 183 214 358
Other expenses 36 59 135 93 111 101 204
------ ---- ----- ----- ----- ------ -----
126 267 359 318 355 314 673
------ ---- ----- ----- ----- ------ -----
Operating earnings before provision (benefit) for
income taxes 77 (43) (75) (6) (31) 44 (37)
Provision (benefit) for income taxes (1) (72) (45) (48) (50) (43) (98)
------ ---- ----- ----- ----- ------ -----
Operating earnings 78 29 (30) 42 19 87 61
Preferred stock dividends 0 31 32 33 33 0 66
------ ---- ----- ----- ----- ------ -----
OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $ 78(2) ($2)(3) ($62) $ 9 ($14) $ 87 ($5)
====== ==== ===== ===== ===== ====== =====
NET INCOME RECONCILIATION
Operating earnings available to common shareholders $ 78 ($2) ($62) $ 9 ($14) $ 87 ($5)
Net investment gains (losses) 1,313 73 118 (49) (64) 1,200 (113)
Minority interest - net investment gains (losses) 0 0 0 0 0 0 0
Net investment gains (losses) tax benefit
(provision) (468) (25) (44) 16 21 (425) 37
------ ---- ----- ----- ----- ------ -----
Net investment gains (losses), net of income taxes 845 48 74 (33) (43) 775 (76)
Adjustments related to universal life and
investment-type product policy fees 0 0 0 0 0 0 0
Adjustments related to policyholder benefits and
dividends 0 0 0 0 0 0 0
Adjustments related to other expenses 0 0 0 0 0 0 0
Adjustments related to tax benefit (provision) 0 0 0 0 0 0 0
------ ---- ----- ----- ----- ------ -----
Adjustments related to net investment gains
(losses), net of income taxes 0 0 0 0 0 0 0
Discontinued operations, net of income taxes 0 0 12 0 30 151 30
------ ---- ----- ----- ----- ------ -----
Net income available to common shareholders 923 46 24 (24) (27) 1,013 (51)
Preferred stock dividends 0 31 32 33 33 0 66
------ ---- ----- ----- ----- ------ -----
Net income $ 923 $ 77 $ 56 $ 9 $ 6 $1,013 $ 15
====== ==== ===== ===== ===== ====== =====
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
(2) Operating earnings available to common shareholders for the three months
ended June 30, 2005 includes a $30 million benefit, net of income taxes,
associated with the reduction of a previously established liability for
settlement death benefits related to the Company's sales practices class
action settlement recorded in 1999 and an $18 million benefit, net of
income taxes, associated with the reduction of a previously established
liability related to the Company's demutualization in 2000.
(3) Operating earnings available to common shareholders for the three months
ended September 30, 2005 includes a $31 million benefit from a revision of
the estimate of income taxes for 2004.
37
(METLIFE(R) LOGO)
METLIFE, INC.
INVESTMENT RESULTS
BY ASSET CATEGORY AND
ANNUALIZED YIELDS
At or For the Three Months Ended
---------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
FIXED MATURITIES (1)
Yield (2) 6.34% 6.03% 6.17% 6.14% 6.10%
Income (3) $ 2,310 $ 2,858 $ 2,954 $ 2,996 $ 2,986
Investment gains (losses) ($89) ($98) ($567) ($412) ($381)
Ending Carrying Value (3) $184,830 $232,041 $230,875 $240,711 $237,612
MORTGAGE AND CONSUMER LOANS
Yield (4) 6.89% 6.96% 6.85% 6.68% 6.41%
Income $ 535 $ 593 $ 591 $ 585 $ 574
Investment gains (losses) ($8) $ 13 $ 23 $ 4 $ 3
Ending Carrying Value $ 33,586 $ 36,094 $ 37,190 $ 37,351 $ 38,665
REAL ESTATE AND REAL ESTATE
JOINT VENTURES
Yield (4) 12.41% 10.72% 8.59% 12.50% 11.37%
Income (5) $ 130 $ 118 $ 100 $ 146 $ 135
Investment gains (losses) (6) $ 1,904 $ 51 $ 166 $ 17 $ 54
Ending Carrying Value $ 3,998 $ 4,705 $ 4,665 $ 4,700 $ 4,786
POLICY LOANS
Yield (4) 6.19% 6.15% 5.80% 5.84% 5.89%
Income $ 139 $ 152 $ 143 $ 146 $ 147
Ending Carrying Value $ 8,975 $ 9,841 $ 9,981 $ 9,987 $ 10,065
EQUITY SECURITIES AND OTHER LIMITED
PARTNERSHIP INTERESTS (1)
Yield (4) 21.40% 9.69% 13.15% 12.86% 14.83%
Income $ 277 $ 170 $ 232 $ 235 $ 278
Investment gains (losses) $ 12 $ 20 $ 32 $ 27 $ 25
Ending Carrying Value $ 5,914 $ 7,403 $ 7,614 $ 7,870 $ 8,007
CASH AND SHORT-TERM INVESTMENTS
Yield (4) 3.57% 3.45% 4.22% 4.63% 4.70%
Income $ 91 $ 122 $ 85 $ 80 $ 85
Investment gains (losses) $ 0 $ 0 ($1) ($1) ($1)
Ending Carrying Value $ 15,770 $ 11,431 $ 7,324 $ 8,512 $ 8,193
OTHER INVESTED ASSETS
Yield (4) 7.83% 10.00% 9.65% 8.92% 7.94%
Income (7) $ 102 $ 186 $ 178 $ 171 $ 168
Investment gains (losses) (7) $ 406 ($9) $ 113 ($259) ($517)
Ending Carrying Value $ 6,452 $ 7,877 $ 8,078 $ 8,386 $ 9,652
TOTAL INVESTMENTS
Gross investment income yield 6.81% 6.30% 6.51% 6.54% 6.49%
Investment fees and expenses yield (0.15%) (0.13%) (0.17%) (0.12%) (0.14%)
-------- -------- -------- -------- --------
NET INVESTMENT INCOME YIELD 6.66% 6.17% 6.34% 6.42% 6.35%
======== ======== ======== ======== ========
Gross investment income $ 3,584 $ 4,199 $ 4,283 $ 4,359 $ 4,373
Investment fees and expenses (76) (87) (116) (81) (96)
-------- -------- -------- -------- --------
NET INVESTMENT INCOME $ 3,508 $ 4,112 $ 4,167 $ 4,278 $ 4,277
======== ======== ======== ======== ========
Ending Carrying Value $259,525 $309,392 $305,727 $317,517 $316,980
======== ======== ======== ======== ========
Gross investment gains $ 2,133 $ 342 $ 492 $ 237 $ 247
Gross investment losses (231) (304) (721) (587) (661)
Writedowns (42) (14) (9) (22) (45)
-------- -------- -------- -------- --------
Subtotal 1,860 24 (238) (372) (459)
Derivative & other instruments not qualifying for
hedge accounting 365 (47) 4 (252) (358)
-------- -------- -------- -------- --------
NET INVESTMENT GAINS (LOSSES) 2,225 (23) (234) (624) (817)
Minority interest - net investment gains (losses) (2) (1) 3 (2) 4
Net investment gains (losses) tax benefit
(provision) (784) 9 85 220 289
-------- -------- -------- -------- --------
NET INVESTMENT GAINS (LOSSES), NET OF INCOME TAXES $ 1,439 ($15) ($146) ($406) ($524)
======== ======== ======== ======== ========
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
(2) The fixed maturities yield is annualized and is based on quarterly average
amortized cost.
(3) Fixed maturities includes $197 million, $805 million, $825 million, $883
million and $519 million in ending carrying value and $2 million, $14
million, ($3) million, $19 million and ($3) million of investment income
(loss) related to trading securities at or for the three months ended June
30, 2005, September 30, 2005, December 31, 2005, March 31, 2006 and June
30, 2006, respectively.
(4) Yields are annualized and based on quarterly average carrying values.
(5) Included in income from real estate and real estate joint ventures is $21
million, $4 million, $9 million, $4 million, and $5 million related to
discontinued operations for the three months ended June 30, 2005, September
30, 2005, December 31, 2005, March 31, 2006 and June 30, 2006,
respectively.
(6) Included in investment gains (losses) from real estate and real estate
joint ventures is $1,905 million, $46 million, $156 million, ($5) million,
and ($3) million related to discontinued operations for the three months
ended June 30, 2005, September 30, 2005, December 31, 2005, March 31, 2006
and June 30, 2006, respectively.
(7) Included in income from other invested assets are scheduled settlement
payments on derivative instruments that do not qualify for hedge accounting
under Statement of Financial Accounting Standards No. 133 of $13 million,
$26 million, $36 million, $39 million and $68 million for the three months
ended June 30, 2005, September 30, 2005, December 31, 2005, March 31, 2006
and June 30, 2006, respectively. These amounts are excluded from net
investment gains (losses). Additionally, excluded from net investment gains
(losses) is ($7) million, ($6) million, ($4) million and $3 million for the
three months ended September 30, 2005, December 31, 2005, March 31, 2006
and June 30, 2006, respectively, related to settlement payments on
derivatives used to hedge interest rate and currency risk on policyholder
account balances that do not qualify for hedge accounting.
38
(METLIFE(R) LOGO)
METLIFE, INC.
INVESTMENT RESULTS
BY ASSET CATEGORY AND
ANNUALIZED YIELDS
At or For the Year-to-Date Ended
--------------------------------------------------------------
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
FIXED MATURITIES (1)
Yield (2) 6.34% 5.94% 6.00% 6.14% 6.12%
Income (3) $4,588 $7,446 $10,400 $2,996 $5,982
Investment gains (losses) ($203) ($301) ($868) ($412) ($793)
Ending Carrying Value (3) $184,830 $232,041 $230,875 $240,711 $237,612
MORTGAGE AND CONSUMER LOANS
Yield (4) 6.79% 6.79% 6.81% 6.68% 6.55%
Income $1,052 $1,645 $2,236 $585 $1,159
Investment gains (losses) ($19) ($6) $17 $4 $7
Ending Carrying Value $33,586 $36,094 $37,190 $37,351 $38,665
REAL ESTATE AND REAL ESTATE
JOINT VENTURES
Yield (4) 11.82% 11.31% 10.59% 12.50% 11.93%
Income (5) $249 $367 $467 $146 $281
Investment gains (losses) (6) $1,922 $1,973 $2,139 $17 $71
Ending Carrying Value $3,998 $4,705 $4,665 $4,700 $4,786
POLICY LOANS
Yield (4) 6.18% 6.08% 6.00% 5.84% 5.86%
Income $277 $429 $572 $146 $293
Ending Carrying Value $8,975 $9,841 $9,981 $9,987 $10,065
EQUITY SECURITIES AND OTHER LIMITED
PARTNERSHIP INTERESTS (1)
Yield (4) 15.92% 12.70% 12.83% 12.86% 13.86%
Income $396 $566 $798 $235 $513
Investment gains (losses) $107 $127 $159 $27 $52
Ending Carrying Value $5,914 $7,403 $7,614 $7,870 $8,007
CASH AND SHORT-TERM INVESTMENTS
Yield (4) 3.59% 3.52% 3.66% 4.63% 4.67%
Income $155 $277 $362 $80 $165
Investment gains (losses) ($1) ($1) ($2) ($1) ($2)
Ending Carrying Value $15,770 $11,431 $7,324 $8,512 $8,193
OTHER INVESTED ASSETS
Yield (4) 8.22% 8.67% 8.96% 8.92% 8.41%
Income (7) $206 $392 $570 $171 $339
Investment gains (losses) (7) $398 $389 $502 ($259) ($776)
Ending Carrying Value $6,452 $7,877 $8,078 $8,386 $9,652
TOTAL INVESTMENTS
Gross investment income yield 6.69% 6.29% 6.35% 6.54% 6.51%
Investment fees and expenses yield (0.13%) (0.13%) (0.14%) (0.12%) (0.13%)
-------- ------------- ------------ --------- --------
NET INVESTMENT INCOME YIELD 6.56% 6.16% 6.21% 6.42% 6.38%
======== ============= ============ ========= ========
Gross investment income $6,923 $11,122 $15,405 $4,359 $8,732
Investment fees and expenses (136) (223) (339) (81) (177)
-------- ------------- ------------ --------- --------
NET INVESTMENT INCOME $6,787 $10,899 $15,066 $4,278 $8,555
======== ============= ============ ========= ========
Ending Carrying Value $259,525 $309,392 $305,727 $317,517 $316,980
======== ============= ============ ========= ========
Gross investment gains $2,506 $2,848 $3,340 $237 $484
Gross investment losses (553) (857) (1,578) (587) (1,248)
Writedowns (93) (107) (116) (22) (67)
-------- ------------- ------------ --------- --------
Subtotal 1,860 1,884 1,646 (372) (831)
Derivative & other instruments not
qualifying for hedge accounting 344 297 301 (252) (610)
-------- ------------- ------------ --------- --------
NET INVESTMENT GAINS (LOSSES) 2,204 2,181 1,947 (624) (1,441)
Minority interest - net investment
gains (losses) (11) (12) (9) (2) 2
Net investment gains (losses) tax
benefit (provision) (775) (766) (681) 220 509
-------- ------------- ------------ --------- --------
NET INVESTMENT GAINS (LOSSES), NET OF
INCOME TAXES $1,418 $1,403 $1,257 ($406) ($930)
======== ============= ============ ========= =======
(1) Certain prior period amounts have been reclassified to conform with current
period presentation.
(2) The fixed maturities yield is annualized and is based on quarterly average
amortized cost.
(3) Fixed maturities includes $197 million, $805 million, $825 million, $883
million and $519 million in ending carrying value and $3 million, $17
million, $14 million, $19 million and $16 million of investment income
related to trading securities at or for year-to-date ended June 30, 2005,
September 30, 2005, December 31, 2005, March 31, 2006 and June 30, 2006,
respectively.
(4) Yields are annualized and based on quarterly average carrying values.
(5) Included in income from real estate and real estate joint ventures is $66
million, $70 million, $78 million, $4 million and $9 million related to
discontinued operations for year-to-date June 30, 2005, September 30, 2005,
December 31, 2005, March 31, 2006 and June 30, 2006, respectively.
(6) Included in investment gains (losses) from real estate and real estate
joint ventures is $1,923 million, $1,969 million, $2,125 million, ($5)
million, and ($8) million related to discontinued operations for
year-to-date June 30, 2005, September 30, 2005, December 31, 2005, March
31, 2006 and June 30, 2006, respectively.
(7) Included in income from other invested assets are scheduled settlement
payments on derivative instruments that do not qualify for hedge accounting
under Statement of Financial Accounting Standards No. 133 of $37 million,
$63 million, $99 million, $39 million and $107 million for the year-to-date
June 30, 2005, September 30, 2005, December 31, 2005, March 31, 2006 and
June 30, 2006, respectively. These amounts are excluded from net investment
gains (losses). Additionally, excluded from net investment gains (losses)
is ($7) million, ($13) million, ($4) million and ($1) million for the
year-to-date September 30, 2005, December 31, 2005, March 31, 2006 and June
30, 2006, respectively, related to settlement payments on derivatives used
to hedge interest rate and currency risk on policyholder account balances
that do not qualify for hedge accounting.
39
(METLIFE(R) LOGO)
METLIFE, INC.
GROSS UNREALIZED GAINS AND LOSSES AGING SCHEDULE
FIXED MATURITIES (1)
At September At December 31, At March 31, At June 30,
At June 30, 2005 30, 2005 2005 2006 2006
---------------- --------------- --------------- --------------- ---------------
% of % of % of % of % of
Unaudited (Dollars in millions) Amount Total Amount Total Amount Total Amount Total Amount Total
------- ------ ------ ------ ------ ------ ------ ------ ------ ------
Less than 20% $ 416 95.4% $1,758 95.9% $2,159 97.9% $4,379 98.7% $6,400 96.3%
20% or more for less than six months 13 3.0% 69 3.8% 39 1.8% 47 1.1% 232 3.5%
20% or more for six months or greater 7 1.6% 6 0.3% 7 0.3% 9 0.2% 10 0.2%
------- ----- ------ ----- ------ ----- ------ ----- ------ -----
Total Gross Unrealized Losses $ 436 100.0% $1,833 100.0% $2,205 100.0% $4,435 100.0% $6,642 100.0%
------- ----- ------ ----- ------ ----- ------ ----- ------ -----
Total Gross Unrealized Gains $11,250 $8,814 $8,329 $6,123 $4,994
======= ====== ====== ====== ======
GROSS UNREALIZED GAINS AND LOSSES AGING SCHEDULE
EQUITY SECURITIES (1)
At September At December 31, At March 31, At June 30,
At June 30, 2005 30, 2005 2005 2006 2006
---------------- --------------- --------------- --------------- ---------------
% of % of % of % of % of
Unaudited (Dollars in millions) Amount Total Amount Total Amount Total Amount Total Amount Total
------- ------ ------ ------ ------ ------ ------ ------ ------ ------
Less than 20% $ 25 62.5% $ 29 70.7% $ 29 70.7% $ 30 75.0% $ 51 69.9%
20% or more for less than six months 15 37.5% 12 29.3% 12 29.3% 10 25.0% 22 30.1%
20% or more for six months or greater 0 0.0% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
------- ----- ------ ----- ------ ----- ------ ----- ------ -----
Total Gross Unrealized Losses $ 40 100.0% $ 41 100.0% $ 41 100.0% $ 40 100.0% $ 73 100.0%
------- ----- ------ ----- ------ ----- ------ ----- ------ -----
Total Gross Unrealized Gains $206 $256 $295 $384 $338
======= ====== ====== ====== ======
(1) The Company's review of its fixed maturities and equity securities for
impairments includes an analysis of the total gross unrealized losses by
three categories of securities: (i) securities where the estimated fair
value had declined and remained below amortized cost by less than 20%; (ii)
securities where the estimated value had declined and remained below
amortized cost by 20% or more for less than six months; and (iii)
securities where the estimated value had declined and remained below
amortized cost by 20% or more for six months or greater.
40
(METLIFE(R) LOGO)
METLIFE, INC.
SUMMARY OF REAL ESTATE
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
Wholly owned $3,277 $3,919 $3,735 $3,902 $3,854
Joint ventures 718 783 926 794 923
------ ------ ------ ------ ------
Subtotal 3,995 4,702 4,661 4,696 4,777
Foreclosed 3 3 4 4 9
------ ------ ------ ------ ------
Total Real Estate (1) $3,998 $4,705 $4,665 $4,700 $4,786
====== ====== ====== ====== ======
SUMMARY OF MORTGAGES AND CONSUMER LOANS
June 30, September 30, December 31, March 31, June 30,
Unaudited (Dollars in millions) 2005 2005 2005 2006 2006
-------- ------------- ------------ --------- --------
COMMERCIAL MORTGAGES $26,100 $27,250 $28,022 $28,278 $29,533
AGRICULTURAL MORTGAGES 6,040 7,474 7,700 7,689 7,817
CONSUMER LOANS 1,446 1,370 1,468 1,384 1,315
------- ------- ------- ------- -------
TOTAL $33,586 $36,094 $37,190 $37,351 $38,665
======= ======= ======= ======= =======
(1) Includes real estate held-for-sale and held-for-investment.
41
(METLIFE(R) LOGO)
COMPANY RATINGS AS OF JULY 28, 2006
Moody's Standard & A.M. Best Fitch
Investors Service Poor's Company Ratings
----------------- ---------- --------- -------
FINANCIAL STRENGTH RATINGS
First MetLife Investors Insurance Co. NR AA* A+ NR
General American Life Insurance Company Aa2 AA* A+ AA
MetLife Insurance Company of Connecticut Aa2 AA* A+ AA
MetLife Insurance Company of Connecticut (Short-term rating) P-1 NR NR NR
MetLife Investors Insurance Company Aa2 AA* A+ AA
MetLife Investors Insurance Company of California NR AA* A+ NR
MetLife Investors USA Insurance Company Aa3 AA* A+ AA
MetLife Life and Annuity Company of Connecticut Aa2 AA* A+ AA
Metropolitan Casualty Insurance Company NR NR A NR
Metropolitan Direct Property and Casualty Insurance Co. NR NR A NR
Metropolitan General Insurance Company NR NR A NR
Metropolitan Group Property & Casualty Insurance Co. NR NR A NR
Metropolitan Life Insurance Company Aa2 AA* A+ AA
Metropolitan Life Insurance Company (Short-term rating) P-1 A-1+ NR NR
Metropolitan Lloyds Insurance Company of Texas NR NR A NR
Metropolitan Property and Casualty Insurance Company Aa3 NR A NR
Metropolitan Tower Life Insurance Company Aa3 NR A+ NR
New England Life Insurance Company Aa2 AA* A+ AA
Texas Life Insurance Company NR NR A NR
RGA Reinsurance Company A1 AA-* A+* AA-
CREDIT RATINGS
GenAmerica Capital I
Preferred Stock A3 BBB+* NR A-
General American Life Insurance Company
Surplus Notes A1 A+* a+* NR
MetLife, Inc.
Senior Unsecured Debt A2 A* a* A
Commercial Paper P-1 A-1 AMB-1* F1
Subordinated Debt A3(P) NR a-* NR
Preferred Stock Baa1 BBB+* bbb+* A-
Non-Cumulative Perpetual Preferred Stock Baa1 BBB* bbb+* A-
MetLife Capital Trust II
Trust Preferred Stock A3 BBB+* a-* A-
MetLife Capital Trust III
Trust Preferred Stock A3 BBB+* a-* A-
MetLife Funding, Inc.
Commercial Paper P-1 A-1+ AMB-1+* F1+
Metropolitan Life Global Funding I
Senior Secured Debt Aa2 AA aa* NR
Metropolitan Life Insurance Company
Surplus Notes A1 A+* a+* A+
Reinsurance Group of America, Incorporated
Senior Unsecured Debt Baa1 A-* a-* A-
Junior Subordinated Debt Baa3 BBB-* bbb* BBB+
RGA Capital Trust I
Preferred Stock Baa2 BBB* bbb+* BBB+
RGA Capital Trust II
Preferred Stock Baa2 BBB* bbb+* BBB+
* Standard & Poor's and A.M. Best's outlook for these ratings is negative.
(P) Preliminary
NR Not Rated
42