MET - Earnings call 4 2023

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the MetLife Fourth Quarter 2023 Earnings Release Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded.

Before we get started, I refer you to the cautionary note about forward-looking statements in yesterday's earnings release and to risk factors discussed in MetLife's SEC filings.

turn Investor over Relations. will Global John I of Head that, the to call Hall, With

John Hall

Earnings Call. Thank appreciate for XXXX you operator. joining Near-Term you, Good us MetLife's morning, Fourth everyone. We and Outlook Quarter

non-GAAP Before we you and in the point should begin, in metlife.com our Relations of earnings supplements, measures which review. information portion you to Investor our on the I on release quarterly financial

slides Also McCallion, features An to a we Q&A participating which night, prepared President On the the the hour. in and will his Khalaf, our as will Chief sensitivities, outlook. McCallion outlook are call you of Financial After address end a the and promptly website. and John Officer; we supplemental prepared our Michel the other Officer. this are should appendix They supplemental well will which Chief available other slides John in remarks, management. Last GAAP discussion quarter have members set morning Executive those senior speak reconciliations disclosures, as review. on the information top which near-term also remarks. slides, are of session at of to released

to one reminder, yourself a limit that, and to please follow-up. With one over As Michel. question

Michel Khalaf

you, Thank morning, and John, good everyone.

illustrated strength taken flexibility by U.S. and the shareholders. In management again focused I in this solid market-leading XXXX, XXXX, on focus, year countering and for our year stood the the times, We results what simplify MetLife ending the our the year that and capital environment shared transactions accelerated cash in would we strategy to fundamentals customers to delivering begin we accomplished business. despite pandemic momentum have We challenging concerns, enter We and As any ever a as financial the up well-timed exit has and a hand. businesses set liquidity it. and our and in and Against to I entered we stronger driving conviction And on our the the the an most MetLife's strong strong we've backdrop, businesses persisted widely managed matters sound robust and inverted crisis actions capital Clearly, yet We uncertain through differentiate as than curve bank are seen. XXXX. our an with recession. resulting of with that maintained this we diversified expected we longer ratios with all-weather quarter. of for than exited remain in yield credit history. adapted steadfastly a our have

a on model, Our our and processes, testament factors and true and assets of liabilities, durability in On successful on that XXXX a is coverage the has stable which point, of apply to portfolio, the strength to we stability XXXX. execution, said, focus relentless to concentrating risk our detailed increase management and last business control, prudence we and our ago, the the we expect we commercial ratios, investment resilience managing and remain culture discipline estate year a that debt we out, portfolio. as the real LTVs borne and service of a in modest our our

recurring repurchases, mid significant post this flexible employing We efficiency flow periods equity, to adjusted direct our and upheld best commitment with strong high-teen its ratio at we and with discipline, financially dividends of expense use agility new payback to expense a free shareholders to companies. We single-digit growth, continue We common of generate capital notable achieving to on returned business. stock holding responsible an year our For all-important in excluding target our the full XX.X%. unwavering delivered year, directing XX.X%, billion items, on share were for highest and and $X.X liquidity IRRs via return cash and we remain and to our metric.

of resilience purpose MetLife's drivers remain powerful our success. of of the and strategy The clarity our

balance of century to Backed ability cash a over confident portfolio our market-leading strong come. as diversified demonstrated stakeholders we create and for to and well half. businesses security deliver our Our am sheet generate for is financial years flow, to positioned I to ability shareholders have other and in a and by to customers perform MetLife's for value to a

or Now $X.XX XXXX night, we adjusted of $X.X results. turning quarter Last reported our per fourth to quarterly earnings share. billion

on strong underwriting we per recurring a excellent items, notable XX% up Again, our $X.XX our investment per and grew year scale XXXX, Shifting higher share, share were helped the that underlying showed reported fundamentals. across our $X.XX year underlying compared factors full the businesses the results. Excluding to balances with market-leading our Also, to momentum and rates. income higher quarter, among businesses ago. money fuel this business new differentiation

excluding items, adjusted earnings, of $X.X notable We generated billion.

policies, yields than as and X% participating at interest adjusted is impact rates for X group most $XX believe $X Higher On the organic tailwind the expectations. falling represents past below X% excluding business roughly pension quarters. net Adjusted transfers, X% consecutive strength investment of climbed variable clear to growth our competitive year-over-year almost money of billion grew rates despite sustainable money risk and We new yields, new investment a with gained from adjusted this excluding PFOs, billion, income PFOs, leading advantage. notable income point across the of continues Solutions and serve to Income rose business franchise the breadth of X%. XX% growth while healthy more PFO of growth $X.X items year. earnings prior Sales a to our exceeding per year. drive Benefits posted adjusted business up segments. Group roll-off with Retirement billion The scale excluding

remains and strong opportunities of in away a for strong, FX-denominated than by 'XX year, Japan a Pension value in MetLife's we $X $X.X XXXX, Korea. life insurance propelled largest cash PRT was $X billion and very new with for in risk billion sales have market new longevity demand Asia settlements. all-time and totaled record RIS third more pipeline in in the an of reinsurance products growth life and followed This transfers in billion from growth strong year in annual Volume structured product the than of history. beyond. Sales more total

continues growing a distribution Latin XXXX reported basis for XX% the as be well Adjusted a and our capabilities we've to portfolio. on in region prior important grew Finally, our over MetLife. earnings product America and expanded as year,

we commitments made to of One Next of is the meet ahead that we schedule accountable all are the criteria. ways we XXXX. against hold ourselves in basis, On Horizon

the certain commitments. In fact, moved on goalpost we on our have Next and of Horizon the bar even raised ourselves

further equity initially and to seen XX% XX% to that we instance, And our XX.X% ratio of return outlook last disclosure, you've from XX.X%. as we target chose to year, committed For an our XX% to target higher expense push to even on XX%. tightened we within adjusted to

aspirations. not greater While we a and success. When our our we and have the it ceiling XXXX from Horizon Next capital conviction of prime on do view emerging constantly another to cash strongest as for standards set strategy, in I higher look spoke stronger, We our even example. MetLife position is

levels dividend billion balance year roughly $X.X markets. higher in geopolitical stock marked stock increase enter us common turmoil, dividends. our of common in to sheet billion XXXX by out ratios enabled cash of common During capital $X.X strength and per we periods our our and Even stock financial our repurchase of key with and paying robust still, share, the

have and into billion in $X.X carried of shares January. has management net XXXX, the capital roughly common Our we repurchased month of

which execution apply disciplined financial evaluating ended strength further We no illustrates our and billion our over the in that portfolio up billion. liquid continue of action billion of buffer with assets doubt to $X.X time XXXX, of we of have on financial billion risk the is target cash closed for authorization. There balance on more cash billion of will MetLife's than full free approximately to our during approach on transfer November. remaining comfortably flexibility to This capacity is billion $X with view our year our $X capital above with $XX $X repurchase particularly and $X.X transaction and the sheet was businesses. We

is I available, pleased continues prove said will Next and return uncertainty. attractive responsible If our will have deploy its am we Horizon we capital strategy that We not, to capital to or amid organically mettle shareholders. consistently growth inorganically. our when

Looking XXXX. and The in to unfolding curve, cycle, yield the events we election or Fed more geopolitical slides anticipate elements by driven U.S. the last changes uncertainty whether near-term to supplemental guidance. policy night targets and it ahead, some published is prudent include of

both further to also for It in Group embedded we margins. business plain revenues. premium to And momentum across the Group This our established for should businesses fees a continue. large that is evident expectations our growth Benefits a strong Non-Medical increased our we've on of base Life underlying where be other and we've note, building anticipate Health outlook and flagship see

In many against It as is long-term we've the our could Next markets allowing impact to contributor asset a the provided Importantly, see well, we single closing, context, purpose. as wish we our it, our serving to strong. In challenges the liabilities us near we equity our years. we positively world live customers our and matching stakeholders execution not digits well-tested track outlook not down the be. strategy we private when predicted and in the we we important in face would asset well assumption more to But have an that diffuse high where in have modest us equity historical used an our in our operate. Private suited we XX% unyielding strategy very XXXX, class return is of to that has remains our been launched and term, Horizon assume prior many liability record the from program. reflects it

strategy. reflect by We move deliver Our with strong performance, supported capacity capital a urgency base. and to good ahead very XXXX on results our saw underlying business our

growth, on we past of ago. progress the MetLife for We responsible driven XXXX will the by efficiency in security, In concentrate energized positions what final of balance businesses and year us new can see Horizon for strategy deployment continued to future believe am continue not frame, the others. heights beyond. X our years time to expense among sheet Next I controlling control, our building possible we for momentum and the I capital reach

Now I'll outlook to detail. our cover turn and to over in it performance John

John McCallion

of as I performance, and morning. the mortgage loan you, update start our provide commercial our portfolio. will which of our liquidity highlights capital slides, financial an well and 'XX good positions with as supplemental Thank Michel, XQ

rates income detail. on Market Page will we the a losses in In addition, near-term discuss XXXX. rates. in fourth and gains full higher the were Net our Starting offset in net in quarter lower the of interest remeasurement mitigated benefit partial due outlook derivative changes interest as the favorable quarter risk provide and markets a impact decline comparison or was rates MRB quarter. only equity I long-term more in year to in earnings of from the to interest were adjusted X, by short-term fourth long-term

adjusted full foreign between losses, the to markets, derivative net attributable For XXXX. changes variance higher and the interest in net and earnings to mostly stronger rates was income in equity primarily year, due currencies

largely unfavorable X, of of for In the you activity a losses result an were well Overall, quarter. perform normal the notable & were in segment, rising the Atlantic. that asbestos comparison with rate of tax, litigation part earnings quarter accounted and There relating expected. On in portfolio addition, no Corporate securities environment the with of $XX the positioned portfolio items credit year levels were fourth to the after as million program mark-to-market in see prior Page XQ transaction modest as on net remains by year-over-year hedging notable trading Other. impact interest to as investment item as in excluding the was the reinsurance Global losses 'XX adjusted of on that transferred of continues reserves can well

continue asbestos the based not as declining the $XXX The $XX end claims on a of frequency declined we latest XXXX. million severe increase our the review, related reserve to claim total of of at count, expected. Regarding observe while has million, asbestos is to reserve

up margins, VII, drivers were and notable XX% per or a currency XX% were volume currency total recurring basis. excluding on up billion, variable and a interest The constant items notable growth items excluding $X.XX, underwriting income, total share, investment higher margins. strong earnings, primary constant and XX% favorable $X.X Adjusted were XX% basis. Adjusted earnings on

life Life saw claims target drivers were versus growth. key U.S. up underwriting a year below margins Benefits the was lower prior of XX% businesses. much XX%. our fourth Group XX.X%, end we of period. quarter. prior and XX.X% mortality quarter adjusted number than the the the and bottom of Consistent range XXXX Group to data, million, life of solid the The earnings mortality $XXX to year with typical to CDC XX% in were ratio favorable volume The Moving favorable

was range Health, to XX.X% Regarding benefit ratio the the quarter, end the and interest-adjusted low of target its Non-Medical XX% in annual of at XX%.

the We given mortality ratio higher the the Non-Medical life the of expect to seasonality and Health be in both ratio business. QX

adjusted Turning to growth points, on up were X% participating XXXX account, Benefits approximately Group which to up X% of PFOs underlying line, XXX top range X% contracts were PFOs a basis the year growth roughly by target year-over-year. our full dampened into year-over-year Taking basis within X%. the

variable due In XX% adjusted Group recurring income, is products, underwriting voluntary. in growth favorable were higher favorable year-over-year. The year-over-year. momentum primarily investment margins. as X% solid million, up to continued XXXX growth and Benefits strong addition, across sales drivers primary investment well were interest due margins including RIS most $XXX were strong to up as The earnings continued

Spreads, RIS strong XX as income by XXX versus pension market. settlement added transfers an growth in highest products higher sales RIS to we as XXX year 'XX, to of billion quarter, marks This regards MetLife, to U.K. well benefits, basis points we reinsurance. $X.X year-over-year, for and third up see With as interest total post-retirement structured well up full were investment primarily billion. were VII to driven spreads the in in-the-money QX fourth basis worth primarily our bringing points, longevity PFOs, risk excluding interest year excluding as rate XX% approximately of PRT, $X.X were roughly the continue active and caps. adjusted from due points. sales rates PRT transactions

lower Moving XX% to and on due XX% million, to taxes. Adjusted earnings Asia. were $XXX and basis, currency investment constant up primarily a margins higher

quarter. sales general year-over-year assets key the up cost management on and a account versus flat prior X% were currency amortized basis, constant on essentially Asia's metrics, year For basis under growth an were

mid- year, a constant driven Latin by offset XXXX a guidance basis, margins earnings digits. its were For volume partially were America less up adjusted strong range due and growth, 'XX. up to sales Asia on the growth strong to XX% versus favorable across XX%, of full exceeding region, X% by the million, QX $XXX currency solid underwriting high-single primarily

X.X% up currency constant In by as on across America's in LATAM 'XX quarter. addition, favorable Chilean and and had year line the perform region. XX% X.X% well of sales adjusted of encaje PFOs persistency Latin to XQ prior the top returns strong were XX% in driven versus solid a continues basis,

XXXX currency For on double-digit a full down unfavorable in charge XX% XX% were PFOs primarily were year, roughly year-over-year. the exceeded expectations basis, EMEA million year currency a adjusted and of constant $XX as favorable This margins. a benefit strong up earnings also PFOs prior $XXX exceeding and by up X% growth. EMEA a outlook constant a XX% on favorable well the interest reported basis, period, by expense XXXX of quarter. of reflecting low basis across LatAm's on constant margins earnings tax adjusted were and XX% adjusted currency up million underwriting both was basis partially guidance constant $XX full sales EMEA as reported a region. driven currency both tax recurring and on our on higher less basis, million, adjusted were following an reported offset year the growth per and

rate earnings foregone of Corporate true-up as $XXX reinsurance November. had was million $XXX adjusted $XX real adjusted in the This X loan by million company's favorable full loss quarters tax return earnings unfavorable pretax were XX%, The returns prior favorable income net compares tax combined the adjusted $XX this of the reflects item by on the provision. On Higher effective in that investment of driven our return in other MetLife a the in tax positive the corporate private which was the in primarily was and primary taxes mortgage approximately closed in transaction million, referenced to includes of million and earlier. equity a Holdings down quarter, earnings and for drivers. after driven tax largely excluding notable The of the were million, Page loss fourth that equity benefits, XX%, quarter $XXX adjusted an result the and year. funds to essentially investment variable federal X, VII primarily income XXXX. related year quarter. estate and of to chart portfolio our the I X funds.

VII below billion. in For XXXX. the in segment quarters X below year approximately while of distributions Page year, $X were well and XXXX mark-to-market generated prior the That full target during for X, approximately returns $X VII full billion was the provide we $XXX the million, XXXX, PE cash post-tax year. portfolio our On expectation by said,

Asia continue reflected long-dated assets largest in As and VII to MetLife liability the hold chart, their of RIS, proportion given profile. Holdings the

The of the our Now net X past QX for versus QX VII chart as shows turning to on the of investment well Page left recurring the 'XX. X. of the page as income 'XX split years and between of

While yield in couple the VII The of than XXXX rates income, had to over right balances. year-over-year. recurring of investment income the the lower recurring lower since attention offset which higher our XQ of has Shifting in interest asset most page, last more of approximately year-over-year, billion net reflecting for your versus $X.X the shows the which VII 'XX. roll-off accounted than new years, in returns trend money yield expansion growth income was and XXXX of up

the yields over our global in In consistent yield. roll-off yield past money X.XX%, its trajectory New the upward of couple quarter, years, than basis money new continued at coming yields outpace points rates. continue this to roll-off rising higher XXX with

expect outperform the sector 'XX average few stable assets mortgage further disciplined the with perform Overall, December ratio CML are higher service investing coverage Turning we XX, XX% updates approach up The to debt at asset quality continues quarter in debt increase in of loans. our as the the modest asset class. this expectations service and consistent at CML broadly. slightly of the our now take portfolio provide X.Xx. coverage and to from commercial to LTVs of average indicators a third on remains steady to in LTV Page The on where XX% portfolio stands X. I'll ratio we

CML Xx. of to less scheduled were in The XXX% strong with only XX% X.X% and quality that regard the With of to mature our portfolio of LTVs than more maturities, having CML loans than XXXX. we remains loans DSCRs resolved loan

credit forward portfolio. Our expectation going remains for modest the on losses

the Turning shows to ratio This X quarters our and expense and XXXX Page chart the X. comparison over of XXXX. direct full prior year

expense higher ratio in XX.X%, of employee-related in as direct Benefits, at up seasonal reflecting modestly as XQ from 'XX impact well enrollment the costs was Our Group costs.

as ratio direct is we our previously, we measure year way believe the have said, fluctuations to best highlighted due full expense quarterly to results. in performance That

expense XXXX result challenging to direct in our below execution inflationary this continuing XXXX, investments efficiency businesses. of mindset target an and demonstrates believe XX.X%, on our was once while in year focus a ratio of environment We full the again make XX.X%. For consistent our our

cash flows. the at is to quarter roughly $XXX the and buffer stock of as discuss well our reflects $X.X at the other target repurchases capital in billion holding Cash I holding will approximately dividend, liquid our cash of as of positions share company above companies $X which and billion. net common fourth companies of billion effects now subsidiary dividends, million The assets were on payment XX, Page cash our December and cash $X expenses holding at the XX.

$XXX shares million In repurchased January. totaling addition, we in approximately

to our period XX% ratio average totaled items X-year notable and XX% free was the XXXX, For target cash excluding XXXX XX% range. and our within flow

NAIC our be still of expected our U.S. preliminary, is terms target. XXX% to In but XXX% for capital our XXXX ratio approximately above combined companies, and RBC statutory

higher net the by transaction. by statutory primarily while For impacts our This were year-over-year, XXXX reinsurance preliminary billion and from partially U.S. offset was expenses. increased operating favorable approximately underwriting driven income approximately billion. $X.X companies, was earnings $X.X $X.X operating billion, by earnings Statutory approximately

to up We from December XXXX, estimate of the XX% dividends capital This approximately statutory earnings XX, and XX, offset XXXX, partially our impact by as that operating was September transaction. of adjusted the reinsurance total billion paid. U.S. was due primarily $XX.X

Finally, as ratio to we solvency in next the XX, approximately XXX% that will statutory December which filed expect of that and few statements weeks. be on be we based margin Japan

shift as through line reflects completeness. the points slides, it's we assumptions Also, The a Before few near-term included metrics that of the on outlook This chart new I MetLife's XXXX on Pages XQ Page again, key for the XXXX. what in our of feel is XX, to XX starting including, rate XX supplemental showed of chart sake we XX provide sensitivities worth segments major on through 'XX outlook, but for appendix. business our Page value business. same we part by interest from and

Page Now for details overview. let's outlook. our on turn Starting with near-term to the XX further

We to XXXX. expect uncertainty persist inflation in around continued unemployment and

We to from be dollar short-term interest XX/XX/XX assume rates in the and assume move will as the annual the return we long-term to modestly XXX. X% stabilize to Based we U.S. and a curve, rates on expect decline, for the interest sloping S&P curve forward yield largely upward XXXX, inverted around current levels. unchanged

are of For maintaining XX%. we to our near-term our adjusted XX% ROE targets, range

of initiatives on to our expense flow X-year guidance adjusted XX.X% earnings. of reinvest efficiency continued our focus ratio XX% and we to Also, free growth expect our average mindset, expense We XX% XXXX to in XX.X%. to overall cash direct building from are lowering given capacity ratio maintain discipline, for

be VII to expected $X.X approximately XXXX, Specifically billion. for

expected rate, given increase of & impact million tax expense $XXX as impact is on lower well costs be $XXX million Corporate as from our a run $XXX This rate in XXXX. pension adjusted range loss C&O's in the and benefits VII. of to $XXX adjusted higher prior expected Our interest XXXX. after an from loss represents target million million higher Other to reflects $XXX environment to guidance The million of current the approximate

certain in reflect higher credits range higher rates lower earnings tax rate points our a markets over and tax At the on interest impact XX% page, to you expectation will by of effective rate expected in tax see the bottom foreign XX% term. modest to our our increasing base near reflecting to U.S. are X relative relatively the sensitivities with case, We for the adjusted to earnings

XXXX equity to XX, asset investments majority $XX continue average VII the the VII billion Page balances in to chart billion On represent will $XX.X reflects from expected of vast Private our asset XXXX. balances. in our

are to We range for annual to And term. private to reducing X% our returns we and expected to X% real equity also our near-term be estate for near other between funds return are expected XX%. lowering the the over of be X% in

pressured PE expect real of We remain the before estate and quarter will higher. 'XX returns in trending first

Finally, as VII. mortgage include fixed a reminder, we loans and fees on in prepayment maturities

for So segments. outlook discuss our now near-term I will business our

Let's start Page on U.S. XX. with the

as For Group $XXX Life PFOs reflects business, the expect excluding X% the adjusted persistency annually the voluntary premium strong expected contracts in XXXX, over range. in for to million This be national grow of excess at in that half participating from as in near the X% we accounts. approximately well momentum to to term. strong top growth Benefits, of are particularly Group in And exceptionally the products XXXX, our

XXXX underwriting, to XXXX. consistent underwriting Regarding be we expect margins with generally

and to and percentage XX% our such, point we X Health Non-Medical XX% are Group to respectively. XX%, Life near-term ratio ranges benefit XX% mortality interest-adjusted As reducing by ratio to

seasonality the of are these skew ratios mind, first of business. given in keep the Finally, higher the end the to and ranges the both typically quarter in annual

spread X% fee-based account liability we total general businesses. our and our for RIS, maintaining exposures annual across growth to expected are X% For

offsetting points reemerging over Regarding throughout contributor. interest VII investment to XXXX. year of roll-off incorporates with more flat our year spread, was meaningful caps a full the for the the of basis XXXX full be and the is This the relatively of XXXX rate of both year as maturities expected XXX and benefit impact

As such, range we spread expect is to for XXX basis points. the XXX investment XXXX

also for movements XXXX. have rate cap provided RIS Sensitivities appendix. interest maturities throughout interest sensitivities from the impact We reflect the in rate updated anticipated

As such, year. [indiscernible] throughout declines to sensitivity the our

and as in XX% and $XXX PFOs thereafter. transaction million are we decline reflect approximately in natural XXXX annually by of XX% For returns well adjusted MetLife from runoff to to adjusted as to expecting PE Holdings, then to range lowering are reinsurance the to guidance earnings earnings X% declining the And business. the foregone to X% $XXX expected million XXXX lower the we

at the look let's U.S. of businesses the Now on Page XX. guidance near-term our outside

For growth the near momentum we Asia, and continue mid over to recent term. sales generate expect the single-digit

maintain In general AUM growth. to addition, we single-digit mid account expect

earnings roughly as We XX% assume are VII in expecting to adjusted impact the greater XXXX year. to grow we a throughout have

are adjusted earnings the growth mid term. maintaining We the remainder over near of single-digit expectation

For both near single digits earnings adjusted high and grow to adjusted by Latin expect America, the we PFOs term. over

of we to to currencies grow EMEA, strengthening for The Finally, over curve are term. the U.S. digits the sales to and assumes expecting adjusted mid-single dollar a relative PFOs grow mid- high-single forward digits near to most in EMEA.

million digits and in run per by earnings such, roughly $XX And then curve XXXX. quarter mid-single rate XXXX currencies. based and $XX on to XXXX in project adjusted million these forward for be EMEA's we As to the grow

strong management. delivered top quarter line strength with conclude a solid to underwriting coupled that me disciplined another saying fundamentals on strong by with expense and our business of year. MetLife Let The out display underlying growth, remains close

to While continue historical remain remains below VII yield benefit robust, the spreads from returns, environment. and core higher

current the a remains strong forward environment move term While our we from prospects strength with continues uncertain, the about excited to beyond. MetLife near the over position and a and growth businesses of are for outlook to responsible committed and our our are capital value and to sheet, we free sustainable for flow shareholders. businesses. our balance recurring customers deploying achieve and cash of market-leading growth build And set diversified a generation

to your questions. operator with the call the that, for will turn And back I

Operator

Instructions]. [Operator

first Krueger is from Our KBW. question Ryan with

Ryan Krueger

the XX%, maybe recognize I outlook year on your something target. And ROE at by to to XX.X%. basis a least target just suggest points segment something it My a first above the question is to but that you like seems XX%, raised closer XX% bit ago would XXX

guess on So current ROE I potential is I hear to that there seeing? your just trends some wanted to thinking upside I incorrectly the perspective am you're about -- this or based on

John McCallion

John. it's Ryan,

calculations model your there. debate wouldn't we think I

with the sign, a think -- and certainly take one time, it's it's with business. shift ago, said, range, here but take of I'd a a you about end been over think I there of year on a -- think stock and time. kind maybe are I our I to help rates, moved result to to there we'll talking if -- like fair of that, year returns think has we've trending is not take that has say and we that other we We just thing plus that say stock. -- been this, and we'll been as high higher a in But at I that just volume it

it it some want time preclude think from we -- wouldn't I again. stock. We to So take us take just doing to

Ryan Krueger

And any would Understood. that offsets? XXX%. be think I higher said Makes any you then the color reinsurance ratio RBC to you would than that more expected it little the thought following around maybe have it have I you there have sense. are transaction. Do been a on if

John McCallion

growth of on, in and to then over when give us time. fungibility, deal, thought Yes, immediately sizable bit points. RIS. little XX would how things very We of we happens We still going tread growth. I some think this had it's XX there's will the a and lot announced other think things we Also, it what in

we've deployed year. this capital So some extra

expected. came we a think of the I signing, at But outlined time deal economics things. in of those terms the as in So lot of that everything

Operator

the to Jefferies. of go Kamath we line Suneet with Next,

Suneet Kamath

maybe to color we could guidance. all But circle recurring on consolidated just NII. if Appreciate back the the

we about big what I could 'XX XXXX? 'XX, pieces moving lift all think look that Any that given you about you the as terms billion. pretty help of in in $XX.X relative think think like talked a to

John McCallion

Suneet, more some depression of point and just from, that -- VII helpful It's to the of than offset question. NII, of mix certainly the offset VII. there's sometimes that rates metric And on show reemerge actually the good mean, it's there higher is I'd John. slide I I in power think it's things kind once front. we a say, a show have to that or more

little just NII a it's Sometimes hard translating earnings. to with

different products that have target and in given that perform this So little different we well we're around environments on a ultimately cautious spread. the because

little kind I of to for a think So you. forecast we're hesitant

indicate point that I think was of we're -- perform the can environments. of well our We away. that think take the diversified. business. that the well theme it that's the a economic really shows in growth in shows probably to It slide And I to variety

to sorry, answer, do. question I -- maybe didn't So get that's best probably your can the exact I but

Suneet Kamath

And we of as as wash? kind think then is kind in a about get X is want if other? benefit looks essentially like VII could. on in just that and Or greater roll than what caps we one to net off, improvement think like the 'XX additional as 'XX it. we in should the Got the of they I that, about those the color some in Okay.

John McCallion

a great it's question. Yes,

just -- said what them about think of in end at is you thinking I around wash good the it. way being a a terms of pretty

bps of for bps XXX had we XXX gave to for a XXX year range So basis year. next last XXXX. We points all-in

cash decline little above there's XXX emerge offset math. rate think off there. will is a year you -- interest year, roll and VII the our throughout the I if essentially did is, will guess, the bps, yes, the the And and I the then view midpoint throughout

so And what and the give saw of is and to year the will the 'XX. here It way relatively think the flat about full spreads we for think year you take to there. best for

rolled quarter As the fully think we Obviously, we will on haven't the off point the be out VII pressured. to continue slide, in yet. first caps

still have the emerges, then off offset. roll VII and have we'll caps you'll we'll essentially income -- them. see as they'll And So from

Operator

a with Evercore Gallagher from question Tom have ISI. we Next,

Thomas Gallagher

I into to I to X your alternative fixed be and would of with X% portfolio average credit RBC the charge, was portfolio. returns do the a years we've let's considered risk for thinking are much if weighted assets like risk Have think just of or just around had perspective So XX% underperformance. income, some but you XX% private the lower of 'XX now it pivoting I'm from of most yields charges. say, other assumed X.X% -- comparable, on that about

year not and for be is rates but fairly about would that positive, levels -- I this those third do to? if meaningful you a ROE, overnight, Your of higher. think outlook cost I both a or your below you shifting it And pivoting something is recognizing think and can't are capital consider

John McCallion

John. it's Tom,

an We fact probably direction around when point lower value that's you was diversification. last I fair for that think are different it you were about rate this pride longer. -- probably piece, point. think can't ourselves do environment, different so they is a of I made talked in we've we travel, than but the investments are important overnight think of relative in a And where I the the

probably are make new revised and that is what to -- that, we're making in will would good would given an you said a think in opportunities where distributions shift -- is then deployed others. in judiciously some think that I we class get new but allocation commitments we different prior We've towards. class that our And do would of an now not So those contributions, abrupt believe right level it's that that time, have see commitments. some that actually, referencing one leveraging. environments. and there really had just you're over outpace versus moderate tweaks lean would I we it's And asset shift, we Having asset appropriate think allocations you likely

Thomas Gallagher

you're what's that? in And at Can Benefits. side, Group or just little the comment visibility loss maybe thinking? Group driving sustainably targets. and points you the higher on on a then ratios Okay. that least on Life question The pricing, XXX a visibility basis loss target what stable low margin improvement or Is the bit ratio

Ramy Tadros

by business highest driven in outlook as here. change the say, we the in I Ramy this we the in that at products terms the segments is, it's our customer serve terms that would level And both mix offer. of here near-term is Tom, as of well

Non-Medical customer growth. average, X the X points and we we've has segment on does for percentage seeing a grown a of also we're Regional higher product that well on regional executed higher of life market see terms ratio continue shift lower ratio markets. to a path perspective. to growth in and benefits So strategy that from from Health to seeing in both markets across a regional a carry We're that and clear target loss underwriting overall the perspective, our growth a than is the

here employee-paid we workplace. penetration on in overall And customer years strategy more the well also to persist strategy And in drive the voluntary, opportunity executed particular. to needs our given the in general voluntary loss and growth that in We've be over expect portfolio. in the and favorable the and we've future many tends ratio seen double-digit to to

that segment outlook between of if shift feel a to warranted. So think customer over view, this the and about we product kind you that time, is

me you been what not tell Let by. driven it's

this ratio, it's mortality John quarter favorable, to was and as life out, driven, experience. the the really On population pointed very

So an one seasonality here this do numbers side, the that as terms of of the is seasonality will I've And business. in was and there, mentioned. outlook outweighed our favorable, moderate disability by to given does And the QX remember, just expect on is dental over profitability other This that include expectation ratio up to the just well tick claims. of there's business life in factors line one of not quarter quarter we mix trend. the QX also in QX seasonality back our disability then of given but that of that is the and the time, ratios the

really as in and product ranges. about that's it this think business customer driving the shift net-net, downwards mix So mix

Operator

go line we JPMorgan. to of the Bhullar Jimmy Next, with

Jamminder Bhullar

the by rates question in gone rising have maybe yields spreads your to discuss crediting much because sequential on is you for business the that. last driver competition of driven we're faster retirement even So quarters? seem than Can each this be of what X of being seeing the decline And versus the mix spreads. first how is up, but

John McCallion

simple for is, in. the us and the how The the rates in the answer sequentially just just John. lower of -- in late the caused quarter the just caps compression lower had bit [developed] it's on a we rates number, Jimmy, money came spread we

XXX ex was came So at XXX VII. than third forward quarter in it time different when the of curve gave at we the range, the to XXX the

speaking. relatively actually So main has driver. healthy, the been pretty that's not pricing. It's Pricing

pricing. We haven't change seen in any

the so anything And curve. really just if anything, simple change -- it's a in

Jamminder Bhullar

several than the And then to in due done how you the Can years, similar CRE on of office is to as sense you're them in resolving these it the all the you next years? X especially of you've Or give a properties? are to have done are them coming the resolving mentioned maturities how you Okay. resolving loans, book us And your past? you of last having would for 'XX. over much over extend portfolio, more X of you

John McCallion

It's Jimmy. Yes, John sure, again.

So of XXXX, was pay for just just off resolution, as reminder, rough the or a XX% about percentages refinance.

where extensions to was in XX Another borrowers these be have financial contractual the good condition.

pretty high some have there. of We level requirements

tend be if those waiting nature if rate the So they're then fixed you rates. they loans requirements, you contractual where -- more right you're and floating in to are just meet lock to those have

say, good a would on for then There's XX% positive of where of It's to less a and borrower. maturity extend, kind us good foreclosures. -- a I points just, couple than there's extensions situation with we agree there's the of

have. the we terms due maturities, that XXXX, the of of I'd percentage. XX% terms to probably of I in in mix -- a terms a terms -- what balance about overall of year in that In this little charge-offs. resolutions, of terms loans similar of PBO in what we comes say were we of saw of think gave at level magnitude thought risk in terms of and we And bit past

that magnitude loans and risk in well. we'd a Our of on both similar is XXXX at see charge-offs level of order view as

Operator

Wells Fargo. the Elyse with to go Greenspan line of we Next,

Elyse Greenspan

side. My is the first PRT question on

think more stopped seeing, the to are deals seasonality I where fourth right, we've much quarter. the weighted

there? should So how about the outlook just trying 'XX transactions for sense think and we to a of get of potential cadence your

Ramy Tadros

here. Ramy Elyse, it's

out the I deals seeing think point that seasonality, right less -- kind the of throughout we're done year. to of being you're seen we've

Our outlook pretty remains positive. there

terms market particular, a sitting sponsors in continue of assets We magnitude activity of market, in continued defined indicators the plant And benefit expectations plan, the healthy competitive. pipeline where frozen high what all see very the pipeline, level, of level at indicate terms the end of of 'XX. a are we to of macro of in into in this saying the most of kind are kind funding the in larger all

view X%. spread earning at of off are more and terms business, I look most in the of growth -- RIS And broadly, that at of general from of all up look, and growth products, where step seeing on. $X.X our change our is growing continued is liability and business back that is be no mean, if but billion our coming exposures we it spread-based was actually you settlements of the $X So are robustness pipeline. coming Solutions year-over-year. billion, the account And that's X% PRT we're which XXXX And mean, also be so across a strength of range PRT. about in and not just structured I had some PRT products our Risk the deal, it

Elyse Greenspan

that to take we capital And are guys 'XX to upstream could then the my in as second about think how could that dividends transaction? question, look should getting guys you parent holdings you the you from

Michel Khalaf

it's Michel. Thanks Elyse, the question. for

you as RBC significant cash heard reinsurance from X.X% approximately I talked that would flexibility. here the does the with we about ratio us is of financial our John, note not just So And providing And proceeds. HoldCo transaction as include yet XXX%. the reinsurance any

in fungible, sitting will is entities. ultimately excess migrate redeploy time. it and HoldCo. capital our view excess the will to capital it the over we We So statutory And as

shareholders. or sort to And in inorganic seen into here. absence built organic the capital consider opportunities, of attractive going we've monthly transaction, as we're for record run in helps. rate buybacks leaned that the on opportunistic I I as how of post a divestitures -- continue but wouldn't especially in full to January we've with January. be you've year, closed hope And track and return and the deliberate we growth of we good terms to since think I being major a expeditious

John McCallion

point we to at would just at And mean, put capital fungibility that. right? -- might I I at I don't the kind add, think the a we finer HoldCo. think the OpCo, I will differently excess just and HoldCo, it the the I necessarily all just we of depend, might mean, have have Elyse, mean, we of on flexibility it because have financial to

of range OpCo. us X to a differently -- that within excess because manage it give X, in that have more some might have We ability we to range

flexibility want just the I to the we think think -- I key point. is So

Operator

Next, Sachs. we Scott Alex line go to with Goldman of the

Taylor Scott

VII like eyes for setting I more one going of and is on little the you specific us a quickly. you First Could level already back much what it had lower to to of quarter the sort results frame opposed the how first just the maybe guidance you guide, have VII is to expectation? since ongoing see it's that VII as in lagged

John McCallion

great not Alex, to a the I'd say proven out would sure that love insights each lag. But it's thought that have quarter. John. so we has way into of the I'm we -- as result it having

-- we we again a the of I that becoming quarters. in more before think contributor is will the we along of bottom think believe kind bump kind that know the all outer meaningful it

their the kind remarks managers think late public a some quarter. though maybe based in writing was even believe conservative We be jumped year-end in of investments remain quarter, will up cautious the multiples. We S&P -- in bit and managers the market it before the on of

come have We financial lot our through. in don't actual assumption. that that's So of a case -- our base that's have kind insight yet of statements

through come move So we'll through -- obviously, as the quarter. those we will

Taylor Scott

Got it.

just mean, starting helpful. maybe second good. you That's there? Benefits, margins in around U.S. up pricing Are competition heat seeing a are LatAm, around one, in forth, any Group enrollment the you and that's really Maybe to on year-end I Okay. so and what saw for

Ramy Tadros

Ramy to in strong I Thanks, start Alex. would here. It's a we're off 'XX. say, really

we with our look our in overall If you saw strong saw a able also take 'XX with we we also market expectations up were were actions persistency segments. and John to that mentioned, X% line at year-over-year, sales very as line rate across in the And expectations.

here margins think X/X, a differentiations as you sales in across still the as of a the We're we is to bit favor playing terms the flavor it solid and on X% that. are outlook. the across margin and I seen, are our core it. and can to our as XX% give competition, in the I indications in the factors about in past really think able you've year-over-year voluntary. of pricing is when of growth growth there of nonprice initial while a portfolio, persistency, into all competitive both and been again with But midst hold product talked about market, So well expanded that we've we've

into terms good and of these indicators 'XX. are really both volume us in we look margin as So for

Operator

And Sandler. have question one John we ladies for from Barnidge Piper and last gentlemen, time with

John Barnidge

of your employee Maybe talk maybe Benefits, or whether end, partners, the can larger you corporate with small viewpoint sticking Group renewals that? it's about X/X with in among growth jumbo maybe a in the counts

Ramy Tadros

is diversified have I employment number the that specifically you look in book don't It's for at terms industry. levels of highly that could a best thing up an for we John, just employee count. handy and down market. The overall diversified indicator because have very by

cost that of to as reflecting broader The more lot could the I this of the employee closely respect where of penetration a at with is in is and see us economy rate So one you is, workspace. think in employee white count. space would we the terms look our

right capabilities over fueling technology, opportunities. deployment voluntary own that's future be And the years, that's the our drive see the our the and few employee continued right really paid. the to still we see past growth what's of or penetration where We plenty of tools, right and voluntary that's engagement opportunity products, growth through it of been

John Barnidge

question. My follow-up

expected. frequency versus talk about that about of claims hasn't the asbestos you was? assumption maybe You Can talked as the declined what

John McCallion

Yes. John. John, it's

third XX said, look claim and the we quarter the as expected declining as where and fourth that where is but or declined hasn't is fast our claims, larger as as a some each there And count, what conduct severe an of So this claims. is this a this exposure trend experience study we at a exposure expected we for just so I something is adjust months, last the mean, different time. -- saw we've that's a for. it's really overall above But we what has we claim in to slightly reserves that needed just Again, we some that runoff quarter. of trued the up $XXX been count seeing million. kind

Operator

conference the John Hall to turn now I'll closing And for remarks. back

John Hall

a this day. morning. Great. operator, thank for you, and Have Thank us you, joining great everybody,

Operator

your does conclude and for today. Ladies conference gentlemen, that you Thank your participation. for

may You disconnect. now

MetLife (MET) 1 Feb 242023 Q4 Earnings call transcript