Condensed Financial Information (Parent Company)

12 Months Ended

Dec. 31, 2013

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Financial Information (Parent Company)

MetLife, Inc.

Schedule II

Condensed Financial Information

(Parent Company Only)

December 31, 2013 and 2012

(In millions, except share and per share data)

	2013			2012
Condensed Balance Sheets
Assets
Investments:
Fixed maturity securities available-for-sale, at estimated fair value (amortized cost: $4,497 and $4,867, respectively)	$	4,531		$	4,967
Equity securities available-for-sale, at estimated fair value (cost: $0 and $15, respectively)	—			13
Short-term investments, principally at estimated fair value	560			295
Other invested assets, at estimated fair value	557			155
Total investments	5,648			5,430
Cash and cash equivalents	648			188
Accrued investment income	40			37
Investment in subsidiaries	76,871			81,769
Loans to subsidiaries	2,333			750
Receivables from subsidiaries	—			7
Other assets	1,677			1,369
Total assets	$	87,217		$	89,550
Liabilities and Stockholders’ Equity
Liabilities
Payables for collateral under securities loaned and other transactions	$	85		$	—
Long-term debt — unaffiliated	15,938			15,669
Long-term debt — affiliated	3,600			3,250
Collateral financing arrangements	2,797			2,797
Junior subordinated debt securities	1,748			1,748
Payables to subsidiaries	13			—
Other liabilities	1,483			1,633
Total liabilities	25,664			25,097
Stockholders’ Equity
Preferred stock, par value $0.01 per share; 200,000,000 shares authorized: 84,000,000 shares issued and outstanding; $2,100 aggregate liquidation preference	1			1
Common stock, par value $0.01 per share; 3,000,000,000 shares authorized; 1,125,224,024 and 1,094,880,623 shares issued at December 31, 2013 and 2012, respectively; 1,122,030,137 and 1,091,686,736 shares outstanding at December 31, 2013 and 2012, respectively	11			11
Additional paid-in capital	29,277			28,011
Retained earnings	27,332			25,205
Treasury stock, at cost; 3,193,887 shares at December 31, 2013 and 2012	(172		)	(172		)
Accumulated other comprehensive income (loss)	5,104			11,397
Total stockholders’ equity	61,553			64,453
Total liabilities and stockholders’ equity	$	87,217		$	89,550

See accompanying notes to the condensed financial information.

MetLife, Inc.

Schedule II

Condensed Financial Information — (Continued)

(Parent Company Only)

For the Years Ended December 31, 2013, 2012 and 2011

(In millions)

	2013			2012			2011
Condensed Statements of Operations
Revenues
Equity in earnings of subsidiaries	$	4,163		$	3,444		$	6,979
Net investment income	304			94			121
Other revenues	155			159			155
Net investment gains (losses)	(80		)	29			(146		)
Net derivative gains (losses)	(99		)	(259		)	82
Total revenues	4,443			3,467			7,191
Expenses
Interest expense	1,122			985			1,007
Goodwill impairment	—			1,384			—
Other expenses	373			167			149
Total expenses	1,495			2,536			1,156
Income (loss) before provision for income tax	2,948			931			6,035
Provision for income tax expense (benefit)	(420		)	(393		)	(388		)
Net income (loss)	3,368			1,324			6,423
Less: Preferred stock dividends	122			122			122
Preferred stock redemption premium	—			—			146
Net income (loss) available to common shareholders	$	3,246		$	1,202		$	6,155
Comprehensive income (loss)	$	(2,925	)	$	6,638		$	11,361

See accompanying notes to the condensed financial information.

MetLife, Inc.

Schedule II

Condensed Financial Information — (Continued)

(Parent Company Only)

For the Years Ended December 31, 2013, 2012 and 2011

(In millions)

	2013			2012			2011
Condensed Statements of Cash Flows
Cash flows from operating activities
Net income (loss)	$	3,368		$	1,324		$	6,423
Earnings of subsidiaries	(4,163		)	(3,444		)	(6,979		)
Dividends from subsidiaries	2,734			3,177			2,578
Goodwill impairment	—			1,384			—
Other, net	(74		)	177			697
Net cash provided by (used in) operating activities	1,865			2,618			2,719
Cash flows from investing activities
Sales of fixed maturity securities	5,108			5,645			3,265
Purchases of fixed maturity securities	(4,795		)	(6,200		)	(4,787		)
Sales of equity securities	13			2			1
Cash received in connection with freestanding derivatives	424			197			257
Cash paid in connection with freestanding derivatives	(465		)	(203		)	(276		)
Sales of businesses	17			—			180
Expense paid on behalf of subsidiaries	(85		)	(80		)	(75		)
Repayments of loans to subsidiaries	645			175			1,275
Issuances of loans to subsidiaries	(1,942		)	(175		)	—
Redemption of preferred stock of subsidiary	300			—			—
Investment in preferred stock of subsidiary	—			—			(250		)
Returns of capital from subsidiaries	267			9			591
Capital contributions to subsidiaries	(748		)	(1,223		)	(1,439		)
Net change in short-term investments	(265		)	372			(620		)
Other, net	(49		)	(48		)	(10		)
Net cash provided by (used in) investing activities	(1,575		)	(1,529		)	(1,888		)
Cash flows from financing activities
Net change in payables for collateral under securities loaned and other transactions	85			(1,180		)	520
Long-term debt issued	994			750			—
Long-term debt repaid	(750		)	(797		)	(750		)
Cash received (paid) in connection with collateral financing arrangements	—			(44		)	37
Common stock issued, net of issuance costs	1,000			1,000			2,950
Redemption of convertible preferred stock	—			—			(2,805		)
Preferred stock redemption premium	—			—			(146		)
Dividends on preferred stock	(122		)	(122		)	(122		)
Dividends on common stock	(1,119		)	(811		)	(787		)
Other, net	82			(6		)	(43		)
Net cash provided by (used in) financing activities	170			(1,210		)	(1,146		)
Change in cash and cash equivalents	460			(121		)	(315		)
Cash and cash equivalents, beginning of year	188			309			624
Cash and cash equivalents, end of year	$	648		$	188		$	309

MetLife, Inc.

Schedule II

Condensed Financial Information — (Continued)

(Parent Company Only)

For the Years Ended December 31, 2013, 2012 and 2011

(In millions)

	2013		2012		2011
Supplemental disclosures of cash flow information:
Net cash paid (received) for:
Interest	$	1,100	$	937	$	997
Income tax	$	69	$	24	$	(659	)
Non-cash transactions:
Dividends from subsidiaries	$	32	$	203	$	170
Returns of capital from subsidiaries	$	—	$	356	$	47
Capital contributions to subsidiaries	$	121	$	559	$	316
Assumption of long-term debt from subsidiary	$	—	$	2,000	$	—
Investment in preferred stock of subsidiary	$	—	$	2,000	$	—
Issuance of long-term debt to subsidiary	$	350	$	750	$	—
Issuance of loan to subsidiary	$	350	$	750	$	—
Allocation of interest expense to subsidiary	$	28	$	33	$	29
Allocation of interest income to subsidiary	$	68	$	76	$	68

MetLife, Inc.

Schedule II

Notes to the Condensed Financial Information

(Parent Company Only)

1. Basis of Presentation

The condensed financial information of MetLife, Inc. (the “Parent Company”) should be read in conjunction with the consolidated financial statements of MetLife, Inc. and its subsidiaries and the notes thereto (the “Consolidated Financial Statements”). These condensed unconsolidated financial statements reflect the results of operations, financial position and cash flows for MetLife, Inc. Investments in subsidiaries are accounted for using the equity method of accounting.

The preparation of these condensed unconsolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to adopt accounting policies and make certain estimates and assumptions. The most important of these estimates and assumptions relate to the fair value measurements, the accounting for goodwill and identifiable intangible assets and the provision for potential losses that may arise from litigation and regulatory proceedings and tax audits, which may affect the amounts reported in the condensed unconsolidated financial statements and accompanying notes. Actual results could differ from these estimates.

[Placeholder for Provida Acquisition and MetLife Bank disposition. Will remove this section if it is not required to disclose neither.]

2. Investment in Subsidiaries

During 2012, MetLife, Inc. assumed debt from Exeter Reassurance Company, Ltd. (“Exeter”), a subsidiary, as described in Note 5, in exchange for $2.0 billion of preferred stock of Exeter. In September 2012, MetLife, Inc. subscribed to 75,000 shares of Exeter’s Series A Non-Cumulative Perpetual Preferred Shares which bears an annual rate of 7.69% that is payable semi-annually. In December 2012, MetLife, Inc. subscribed to 125,000 shares of Exeter’s Series B Non-Cumulative Perpetual Preferred Shares which bears an annual rate of 7.75% that is payable semi-annually.

3. Loans to Subsidiaries

MetLife, Inc. lends funds, as necessary, to its subsidiaries, some of which are regulated, to meet their capital requirements. Payments of interest and principal on surplus notes of regulated subsidiaries, which are subordinate to all other obligations of the issuing company, may be made only with the prior approval of the insurance department of the state of domicile.

In December 2013, MetLife Reinsurance Company of Delaware (“MRD”), issued a $350 million surplus note to MetLife, Inc. due December 2033. The surplus note bears interest at a fixed rate of 6.00% payable semi-annually. MetLife, Inc. issued a $350 million senior note to MRD in exchange for the surplus note (see Note 4).

In July, 2013, MetLife Ireland Treasury Limited (“MITL”) borrowed the Chilean peso equivalent of $1.5 billion from MetLife, Inc., which is due July 2023. The loan bears interest at a fixed rate of 8.5%, payable annually. In December 2013, MITL repaid $245 million of the loan to MetLife, Inc.

In December 2012, MRD issued a $750 million surplus note to MetLife, Inc. due September 30, 2032. The surplus note bears interest at a fixed rate of 5.13% payable semi-annually. In December 2012, MetLife, Inc. issued a $750 million senior note to MRD in exchange for the surplus note (see Note 4).

In December 2011, Metropolitan Life Insurance Company (“MLIC”) repaid in cash the $500 million capital notes issued to MetLife, Inc. In April 2011, MLIC repaid in cash a $775 million surplus note issued to MetLife, Inc. and due December 2011. The early redemption was approved by the New York Superintendent of Insurance.

Interest income earned on loans to subsidiaries of $103 million, $1 million and $40 million for the years ended December 31, 2013, 2012 and 2011, respectively, is included in net investment income.

4. Long-term Debt

Long-term debt outstanding was as follows:

	Interest Rates (1)			December 31,
	Range	Weighted Average	Maturity	2013		2012
				(In millions)
Senior notes — unaffiliated	1.52% - 7.72%	4.96%	2014 - 2045	$	15,938	$	15,669
Senior notes — affiliated	3.57% - 7.44%	5.43%	2014 - 2033	3,100		2,750
Other affiliated debt	0.95% - 1.01%	0.98%	2015 - 2016	500		500
Total				$	19,538	$	18,919

______________

(1) Range of interest rates and weighted average interest rates are for the year ended December 31, 2013.

See Note 12 of the Notes to the Consolidated Financial Statements for information about the issuances of senior notes - unaffiliated in 2013 and 2012.

The aggregate maturities of long-term debt at December 31, 2013 for the next five years and thereafter are $1.9 billion in 2014, $1.3 billion in 2015, $1.7 billion in 2016, $500 million in 2017, $1.5 billion in 2018 and $12.6 billion thereafter.

Senior Notes – Affiliated

In December 2013, MetLife, Inc. issued a $350 million senior note to MRD due December 31, 2033. The senior note bears interest at a fixed rate of 5.10%, payable semi-annually. MRD issued a $350 million surplus note to MetLife, Inc. in exchange for the senior note.

In December 2012, $1.25 billion of senior notes issued by Exeter, payable to affiliates and comprised of three notes, were reassigned to MetLife, Inc. MetLife, Inc. received $1.25 billion of preferred stock of Exeter in exchange for the assumption of this affiliated debt (see Note 3). A $250 million senior note matures on September 30, 2016 and bears interest at a fixed rate of 7.44%, payable semi-annually. A $500 million senior note matures on July 15, 2021 and bears interest at a fixed rate of 5.64%, payable semi-annually. A $500 million senior note matures on December 16, 2021 and bears interest at a fixed rate of 5.86%, payable semi-annually.

In December 2012, MetLife, Inc. issued a $750 million senior note to MRD due September 30, 2032. The senior note bears interest at a fixed rate of 4.21%, payable semi-annually. MRD issued a $750 million surplus note to MetLife, Inc. in exchange for the senior note.

In September 2012, $750 million of senior notes issued by Exeter payable to MLIC were reassigned to MetLife, Inc. MetLife, Inc. received $750 million of preferred stock of Exeter in exchange for the assumption of this affiliated debt (see Note 3). On September 30, 2012, $250 million of the assumed senior notes matured and, subsequently, in October 2012, a $250 million senior note was issued by MetLife, Inc. to MLIC. The $250 million senior note matures on October 1, 2019 and bears interest at a fixed rate of 3.57%, payable semi-annually. The remaining $500 million senior note matures on June 30, 2014 and bears interest at a fixed rate of 6.44%, payable semi-annually.

Interest Expense

Interest expense was comprised of the following:

	Years Ended December 31,
	2013		2012		2011
	(In millions)
Long-term debt — unaffiliated	$	790	$	779	$	806
Long-term debt — affiliated	163		28		16
Collateral financing arrangements	35		42		43
Junior subordinated debt securities	134		134		134
Stock purchase contracts	—		2		8
Total	$	1,122	$	985	$	1,007

5. Support Agreements

MetLife, Inc. is party to various capital support commitments and guarantees with certain of its subsidiaries. Under these arrangements, MetLife, Inc. has agreed to cause each such entity to meet specified capital and surplus levels or has guaranteed certain contractual obligations.

In October 2013, MetLife, Inc. guaranteed two-year notes issued by Exeter to affiliates, MetLife Insurance Company of Connecticut and MetLife Investors USA Insurance Company, totaling $500 million that bear interest at 2.47%.

In January 2013, MetLife, Inc. entered into an 18-month agreement with MetLife Bank, National Association’s (“MetLife Bank”) to lend up to $500 million to MetLife Bank on a revolving basis. In February 2013, the agreement was amended to reduce borrowing capacity to $100 million. MetLife Bank's rights and obligations under the agreement succeeded to MetLife Home Loans LLC (“MLHL”) upon the merger of MetLife Bank with and into MLHL. On October 29, 2013, MetLife, Inc. and MLHL agreed to terminate the agreement. There were no loans outstanding at such date.

In July 2012, in connection with an operating agreement with the Comptroller of the Currency (the “OCC”) governing MetLife Bank operations during its wind-down process, MetLife Bank and MetLife, Inc. entered into a capital support agreement with the OCC and MetLife, Inc. and MetLife Bank entered into an indemnification and capital maintenance agreement under which agreements MetLife, Inc. provided financial and other support to MetLife Bank to ensure that MetLife Bank could wind down its operations in a safe and sound manner. Pursuant to the agreements, MetLife, Inc. was required to ensure that MetLife Bank meets or exceeds certain minimum capital and liquidity requirements and make indemnification payments to MetLife Bank in connection with MetLife Bank’s obligation under the April 2011 consent decree between MetLife Bank and the OCC. During the years ended December 31, 2013 and 2012, MetLife, Inc. invested $21 million and $34 million, respectively, in cash in MetLife Bank in connection with these agreements. On August 30, 2013, MetLife Bank merged with and into MLHL, with MLHL as the surviving, non-bank entity. The obligations of MetLife, Inc. and MetLife Bank under the capital support agreement with the OCC and the obligations of MetLife, Inc. under the indemnification and capital maintenance agreement ceased in all material respects upon the merger of MetLife Bank with and into MLHL.

MetLife, Inc., in connection with MRD’s reinsurance of certain universal life and term life risks, entered into a capital maintenance agreement pursuant to which MetLife, Inc. agreed, without limitation as to amount, to cause the initial protected cell of MRD to maintain total adjusted capital equal to or greater than 200% of such protected cell’s company action level risk-based capital (“RBC”), as defined in state insurance statutes.

MetLife, Inc. guarantees the obligations of its subsidiary, DelAm, under a stop loss reinsurance agreement with RGA Reinsurance (Barbados) Inc. (“RGARe”), pursuant to which RGARe retrocedes to DelAm a portion of the whole life medical insurance business that RGARe assumed from American Life on behalf of its Japan operations. Also, MetLife, Inc. guarantees the obligations of its subsidiary, Missouri Reinsurance, Inc. (“MoRe”), under a retrocession agreement with RGARe, pursuant to which MoRe retrocedes certain group term life insurance liabilities and a portion of the closed block liabilities associated with industrial life and ordinary life insurance policies that it assumed from MLIC.

Prior to the sale in April 2011 of its 50% interest in Mitsui Sumitomo MetLife Insurance Co., Ltd. (‘MSI MetLife’) to a third party, MetLife, Inc. guaranteed the obligations of its subsidiary, Exeter, under a reinsurance agreement with MSI MetLife, under which Exeter reinsures variable annuity business written by MSI MetLife. This guarantee will remain in place until such time as the reinsurance agreement between Exeter and MSI MetLife is terminated, notwithstanding the April 2011 disposition of MetLife, Inc.’s interest in MSI MetLife as described in Note 3 of the Notes to the Consolidated Financial Statements.

MetLife, Inc. guarantees the obligations of Exeter in an aggregate amount up to $1.0 billion, under a reinsurance agreement with MetLife Europe Limited (“MEL”), under which Exeter reinsures the guaranteed living benefits and guaranteed death benefits associated with certain unit-linked annuity contracts issued by MEL.

MetLife, Inc., in connection with MetLife Reinsurance Company of Vermont’s (“MRV”) reinsurance of certain universal life and term life insurance risks, committed to the Vermont Department of Banking, Insurance, Securities and Health Care Administration to take necessary action to cause the three protected cells of MRV to maintain total adjusted capital in an amount that is equal to or greater than 200% of each such protected cell’s authorized control level RBC, as defined in Vermont state insurance statutes. See Note 12 of the Notes to the Consolidated Financial Statements.

MetLife, Inc., in connection with the collateral financing arrangement associated with MetLife Reinsurance Company of Charleston’s (“MRC”) reinsurance of a portion of the liabilities associated with the closed block, committed to the South Carolina Department of Insurance to make capital contributions, if necessary, to MRC so that MRC may at all times maintain its total adjusted capital in an amount that is equal to or greater than 200% of the company action level RBC, as defined in South Carolina state insurance statutes as in effect on the date of determination or December 31, 2007, whichever calculation produces the greater capital requirement, or as otherwise required by the South Carolina Department of Insurance. See Note 13 of the Notes to the Consolidated Financial Statements.

MetLife, Inc., in connection with the collateral financing arrangement associated with MetLife Reinsurance Company of South Carolina’s (“MRSC”) reinsurance of universal life secondary guarantees, committed to the South Carolina Department of Insurance to take necessary action to cause MRSC to maintain the greater of capital and surplus of $250,000 or total adjusted capital in an amount that is equal to or greater than 100% of authorized control level RBC, as defined in South Carolina state insurance statutes. See Note 13 of the Notes to the Consolidated Financial Statements.

MetLife, Inc. has net worth maintenance agreements with two of its insurance subsidiaries, MetLife Investors Insurance Company and First MetLife Investors Insurance Company. Under these agreements, as amended, MetLife, Inc. agreed, without limitation as to the amount, to cause each of these subsidiaries to have capital and surplus of $10 million, total adjusted capital in an amount that is equal to or greater than 150% of the company action level RBC, as defined by applicable state insurance statutes, and liquidity necessary to enable it to meet its current obligations on a timely basis.

MetLife, Inc. guarantees obligations arising from derivatives of the following subsidiaries: Exeter, MetLife International Holdings, Inc. and MetLife Worldwide Holdings, Inc. These subsidiaries are exposed to various risks relating to their ongoing business operations, including interest rate, foreign currency exchange rate, credit and equity market. These subsidiaries use a variety of strategies to manage these risks, including the use of derivatives. Further, all of the subsidiaries’ derivatives are subject to industry standard netting agreements and collateral agreements that limit the unsecured portion of any open derivative position. On a net counterparty basis at December 31, 2013 and 2012, derivative transactions with positive mark-to-market values (in-the-money) were $568 million and $3.2 billion, respectively, and derivative transactions with negative mark-to-market values (out-of-the-money) were $734 million and $22 million, respectively. To secure the obligations represented by the out of-the-money transactions, the subsidiaries had provided collateral to their counterparties with an estimated fair value of $651 million and $12 million at December 31, 2013 and 2012, respectively. Accordingly, unsecured derivative liabilities guaranteed by MetLife, Inc. were $83 million and $10 million at December 31, 2013 and 2012, respectively.

MetLife, Inc. also guarantees the obligations of certain of its subsidiaries under committed facilities with third-party banks. See Note 12 of the Notes to the Consolidated Financial Statements.