Equity

6 Months Ended

Jun. 30, 2015

Equity [Abstract]

Equity

9. Equity

Preferred Stock

In June 2015, MetLife, Inc. issued 1,500,000 shares of 5.25% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series C (the "Series C preferred shares"), with a $0.01 par value per share and a liquidation preference of $1,000 per share, for aggregate proceeds of $1.5 billion.

The Series C preferred shares rank senior to MetLife, Inc.’s common stock with respect to the payment of dividends and distributions upon liquidation, dissolution or winding-up. Holders of the Series C preferred shares will be entitled to receive dividend payments only when, as and if declared by MetLife, Inc.’s Board of Directors or a duly authorized committee of the Board. If dividends are declared on the Series C preferred shares for any dividend period, they will be calculated on a non-cumulative basis at a fixed rate per annum of 5.25% from the date of original issue to but excluding June 15, 2020, and at a floating rate per annum equal to three-month U.S. dollar LIBOR plus 3.575% on the related LIBOR determination date from and after June 15, 2020. Dividends for any dividend period will be payable, if declared, semi-annually in arrears on the 15th day of June and December of each year commencing on December 15, 2015 to June 15, 2020, and thereafter quarterly in arrears on the 15th day of September, December, March and June of each year.

Dividends on the Series C preferred shares will not be cumulative and will not be mandatory. Accordingly, if dividends are not declared on the Series C preferred shares for any dividend period, then any accrued dividends for that dividend period will cease to accrue and be payable. If a dividend is not declared before the dividend payment date for any dividend period, MetLife, Inc. will have no obligation to pay dividends accrued for such dividend period whether or not dividends on the Series C preferred shares are declared for any future dividend period. No dividends may be paid or declared on MetLife, Inc.’s common stock (or any other securities ranking junior to the Series C preferred shares) and MetLife, Inc. may not purchase, redeem, or otherwise acquire its common stock (or other such junior stock) unless the full dividends for the latest completed dividend period on all outstanding Series C preferred shares, and any parity stock, have been declared and paid or provided for.

On or prior to December 31, 2018, MetLife, Inc. is prohibited from declaring dividends on the Series C preferred shares if it fails to meet specified capital adequacy, net income and stockholders’ equity levels. Beginning on January 1, 2019, MetLife, Inc. will no longer be subject to such limitations. At June 30, 2015, there were no dividends declared on the Series C preferred shares.

Holders of the Series C preferred shares do not have voting rights except in certain circumstances, including where the dividends have not been paid for an equivalent of six or more dividend payment periods whether or not those periods are consecutive. Under such circumstances, the holders of the Series C preferred shares have certain voting rights with respect to members of the Board of Directors of MetLife, Inc.

The Series C preferred shares are not subject to any mandatory redemption, sinking fund, retirement fund, purchase fund or similar provisions. MetLife, Inc. may, at its option, redeem the Series C preferred shares, (i) in whole but not in part, at any time prior to June 15, 2020, within 90 days after the occurrence of a “regulatory capital event,” and (ii) in whole or in part, from time to time, on or after June 15, 2020, in each case, at a redemption price equal to $1,000 per Series C preferred share, plus an amount equal to any dividends per share that have accrued but not been declared and paid for the then-current dividend period to, but excluding, such redemption date. A “regulatory capital event” could occur as a result of a change or proposed change in capital adequacy rules (or the interpretation or application thereof) that would apply to MetLife, Inc. from rules (or the interpretation or application thereof) in effect with respect to bank holding companies as of June 1, 2015 that would create a more than insubstantial risk, as determined by MetLife, Inc., that the Series C preferred shares would not be treated as “Tier 1 Capital” or as capital with attributes similar to those of Tier 1 Capital.

In June 2015, MetLife, Inc. entered into a replacement capital covenant (“RCC”) related to the Series C preferred shares. As part of such RCC, MetLife, Inc. agreed that it will not repay, redeem or purchase the Series C preferred shares on or before December 31, 2018, unless, subject to certain limitations, it has received proceeds during a specified period from the sale of specified replacement securities. The RCC is for the benefit of the holders of the related covered debt, which is currently MetLife, Inc.’s 10.750% Fixed-to-Floating Junior Subordinated Debentures due 2069. The RCC will terminate upon the earliest to occur of (i) December 31, 2018, or the date on which the Series C preferred shares are no longer outstanding or the RCC is not otherwise still in effect, (ii) the date on which the holders in majority principal amount of the then-effective covered debt consent to the termination of the RCC, or (iii) the date on which MetLife, Inc. has no series of outstanding eligible debt securities.

In connection with the offering of the Series C preferred shares, MetLife, Inc. incurred $17 million of issuance costs which have been recorded as a reduction of additional paid-in capital.

In June 2015, MetLife, Inc. conducted a tender offer for up to 59,850,000 of its 60,000,000 shares of 6.50% Non-Cumulative Preferred Stock, Series B (the “Series B preferred shares”), at a purchase price of $25 per Series B preferred share, plus an amount equal to accrued, unpaid and undeclared dividends from, and including, June 15, 2015 to, but excluding, June 29, 2015, the settlement date of the tender offer. In June 2015, MetLife, Inc. also delivered a notice of redemption to the holders of the Series B preferred shares, pursuant to which it would redeem any Series B preferred shares not purchased by it in the tender offer at a redemption price of $25 per Series B preferred share, without any payment for accrued, unpaid and undeclared dividends on the Series B preferred shares from, and including, June 15, 2015 to, but excluding July 1, 2015, the redemption date. On June 29, 2015, MetLife, Inc. repurchased and canceled 37,192,413 Series B preferred shares in the tender offer for $932 million in cash, resulting in a remaining liability of $570 million, which was included in other liabilities at June 30, 2015. On July 1, 2015, MetLife, Inc. redeemed and canceled the remaining 22,807,587 Series B preferred shares not tendered in the tender offer for an aggregate redemption price of $570 million in cash. In connection with the tender offer and redemption, MetLife, Inc. recognized a preferred stock repurchase premium of $42 million (calculated as the difference between the carrying value of the Series B preferred shares and the total amount paid by MetLife, Inc. to the holders of the Series B preferred shares in connection with the tender offer and redemption), which was recorded as a reduction to retained earnings at June 30, 2015.

Further information on MetLife, Inc.’s authorized, issued and outstanding preferred stock was as follows:

	June 30, 2015			December 31, 2014
Series	Shares Authorized	Shares Issued	Shares Outstanding	Shares Authorized	Shares Issued	Shares Outstanding
Floating Rate Non-Cumulative Preferred Stock, Series A	27,600,000	24,000,000	24,000,000	27,600,000	24,000,000	24,000,000
6.50% Non-Cumulative Preferred Stock, Series B (1)	69,000,000	—	—	69,000,000	60,000,000	60,000,000
5.25% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series C	1,500,000	1,500,000	1,500,000	—	—	—
Series A Junior Participating Preferred Stock	10,000,000	—	—	10,000,000	—	—
Not designated	91,900,000	—	—	93,400,000	—	—
Total	200,000,000	25,500,000	25,500,000	200,000,000	84,000,000	84,000,000

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(1) As discussed further above, on July 1, 2015, MetLife, Inc. redeemed and canceled the remaining 22,807,587 Series B preferred shares not tendered in the tender offer.

Common Stock

During the six months endedJune 30, 2015 and 2014, MetLife, Inc. repurchased 20,176,185 and 80,662 shares through open market purchases for $1.0 billion and $4 million, respectively.

At June 30, 2015, MetLife, Inc. had $261 million remaining under its common stock repurchase authorization. Future common stock repurchases will be dependent upon several factors, including the Company’s capital position, liquidity, financial strength and credit ratings, general market conditions, the market price of MetLife, Inc.’s common stock compared to management’s assessment of the stock’s underlying value and applicable regulatory approvals, as well as other legal and accounting factors.

Stock-Based Compensation Plans

Performance Shares and Performance Units

For outstanding awards granted prior to the January 1, 2013 - December 31, 2015 performance period, vested Performance Shares and Performance Units were or will be multiplied by a performance factor of 0% to 200% based on MetLife, Inc.’s adjusted income, total shareholder return, and performance in change in annual net operating earnings and total shareholder return compared to the performance of its competitors, each measured with respect to the applicable three-year performance period or portions thereof. See also “— Payout of 2012 – 2014 Performance Shares” and “— Payout of 2012 – 2014 Performance Units.”

For outstanding awards granted for the January 1, 2013 – December 31, 2015 and later performance periods, any vested Performance Shares and Performance Units will be multiplied by a performance factor of 0% to 175%. Assuming that MetLife, Inc. has met threshold performance goals related to its adjusted income or total shareholder return, the MetLife, Inc. Compensation Committee will determine the performance factor in its discretion. In doing so, the Compensation Committee may consider MetLife, Inc.’s total shareholder return relative to the performance of its competitors and MetLife, Inc.’s operating return on equity relative to its financial plan. The estimated fair value of Performance Shares and Performance Units will be remeasured each quarter until they become payable.

Beginning in 2015, MetLife, Inc. grants awards under the MetLife, Inc. 2015 Stock and Incentive Compensation Plan (successor to the MetLife, Inc. 2005 Stock and Incentive Compensation Plan) and the MetLife, Inc. 2015 Non-Management Director Stock Compensation Plan (successor to the MetLife, Inc. 2005 Non-Management Director Stock Compensation Plan), each of which was approved by MetLife, Inc. common stockholders in 2014.

Payout of 2012 – 2014 Performance Shares

Final Performance Shares are paid in shares of MetLife, Inc. common stock. The performance factor for the January 1, 2012 – December 31, 2014 performance period was 101%. This factor has been applied to the 1,756,839 Performance Shares associated with that performance period that vested on December 31, 2014 and, as a result, in April 2015, 1,774,407 shares of MetLife, Inc.’s common stock (less withholding for taxes and other items, as applicable) were issued, excluding shares that payees choose to defer.

Payout of 2012 – 2014 Performance Units

Final Performance Units are payable in cash equal to the closing price of MetLife, Inc. common stock on a date following the last day of the three-year performance period. The performance factor for the January 1, 2012 – December 31, 2014 performance period was 101%. This factor has been applied to the 129,734 Performance Units associated with that performance period that vested on December 31, 2014 and, as a result, in April 2015, the cash value of 131,031 units (less withholding for taxes and other items, as applicable) was paid.

Accumulated Other Comprehensive Income (Loss)

Information regarding changes in the balances of each component of AOCI attributable to MetLife, Inc., was as follows:

	Three Months   Ended   June 30, 2015
	Unrealized Investment Gains (Losses), Net of Related Offsets (1)			Unrealized Gains (Losses) on Derivatives			Foreign Currency Translation Adjustments			Defined Benefit Plans Adjustment			Total
	(In millions)
Balance, beginning of period	$	16,206		$	1,555		$	(3,986	)	$	(2,246	)	$	11,529
OCI before reclassifications	(6,511		)	(395		)	(237		)	3			(7,140		)
Deferred income tax benefit (expense)	2,178			150			9			(1		)	2,336
AOCI before reclassifications, net of income tax	11,873			1,310			(4,214		)	(2,244		)	6,725
Amounts reclassified from AOCI	(177		)	(303		)	—			57			(423		)
Deferred income tax benefit (expense)	65			95			—			(19		)	141
Amounts reclassified from AOCI, net of income tax	(112		)	(208		)	—			38			(282		)
Sale of subsidiary	—			—			—			—			—
Deferred income tax benefit (expense)	—			—			—			—			—
Sale of subsidiary, net of income tax	—			—			—			—			—
Balance, end of period	$	11,761		$	1,102		$	(4,214	)	$	(2,206	)	$	6,443

	Three Months   Ended   June 30, 2014
	Unrealized Investment Gains (Losses), Net of Related Offsets (1)			Unrealized Gains (Losses) on Derivatives			Foreign Currency Translation Adjustments			Defined Benefit Plans Adjustment			Total
	(In millions)
Balance, beginning of period	$	11,276		$	404		$	(1,843	)	$	(1,622	)	$	8,215
OCI before reclassifications	4,330			175			(5		)	6			4,506
Deferred income tax benefit (expense)	(1,336		)	(48		)	53			(2		)	(1,333		)
AOCI before reclassifications, net of income tax	14,270			531			(1,795		)	(1,618		)	11,388
Amounts reclassified from AOCI	(176		)	(80		)	77			46			(133		)
Deferred income tax benefit (expense)	55			25			(27		)	(16		)	37
Amounts reclassified from AOCI, net of income tax	(121		)	(55		)	50			30			(96		)
Sale of subsidiary (2)	(320		)	—			6			—			(314		)
Deferred income tax benefit (expense)	80			—			—			—			80
Sale of subsidiary, net of income tax	(240		)	—			6			—			(234		)
Balance, end of period	$	13,909		$	476		$	(1,739	)	$	(1,588	)	$	11,058

	Six Months   Ended   June 30, 2015
	Unrealized Investment Gains (Losses), Net of Related Offsets (1)			Unrealized Gains (Losses) on Derivatives			Foreign Currency Translation Adjustments			Defined Benefit Plans Adjustment			Total
	(In millions)
Balance, beginning of period	$	15,159		$	1,076		$	(3,303	)	$	(2,283	)	$	10,649
OCI before reclassifications	(4,885		)	(208		)	(907		)	3			(5,997		)
Deferred income tax benefit (expense)	1,677			84			(4		)	(1		)	1,756
AOCI before reclassifications, net of income tax	11,951			952			(4,214		)	(2,281		)	6,408
Amounts reclassified from AOCI	(290		)	251			—			114			75
Deferred income tax benefit (expense)	100			(101		)	—			(39		)	(40		)
Amounts reclassified from AOCI, net of income tax	(190		)	150			—			75			35
Sale of subsidiary	—			—			—			—			—
Deferred income tax benefit (expense)	—			—			—			—			—
Sale of subsidiary, net of income tax	—			—			—			—			—
Balance, end of period	$	11,761		$	1,102		$	(4,214	)	$	(2,206	)	$	6,443

	Six Months   Ended   June 30, 2014
	Unrealized Investment Gains (Losses), Net of Related Offsets (1)			Unrealized Gains (Losses) on Derivatives			Foreign Currency Translation Adjustments			Defined Benefit Plans Adjustment			Total
	(In millions)
Balance, beginning of period	$	8,183		$	231		$	(1,659	)	$	(1,651	)	$	5,104
OCI before reclassifications	9,182			496			(222		)	6			9,462
Deferred income tax benefit (expense)	(2,981		)	(161		)	86			(2		)	(3,058		)
AOCI before reclassifications, net of income tax	14,384			566			(1,795		)	(1,647		)	11,508
Amounts reclassified from AOCI	(349		)	(134		)	77			91			(315		)
Deferred income tax benefit (expense)	114			44			(27		)	(32		)	99
Amounts reclassified from AOCI, net of income tax	(235		)	(90		)	50			59			(216		)
Sale of subsidiary (2)	(320		)	—			6			—			(314		)
Deferred income tax benefit (expense)	80			—			—			—			80
Sale of subsidiary, net of income tax	(240		)	—			6			—			(234		)
Balance, end of period	$	13,909		$	476		$	(1,739	)	$	(1,588	)	$	11,058

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(1) See Note 5 for information on offsets to investments related to future policy benefits, DAC, VOBA and DSI, and the policyholder dividend obligation.

(2) See Note 3 of the Notes to the Consolidated Financial Statements included in the 2014 Annual Report.

Information regarding amounts reclassified out of each component of AOCI was as follows:

AOCI Components	Amounts Reclassified from AOCI												Consolidated Statement of Operations and Comprehensive Income (Loss) Locations
	Three Months   Ended   June 30,						Six Months   Ended   June 30,
	2015			2014			2015			2014
	(In millions)
Net unrealized investment gains (losses):
Net unrealized investment gains (losses)	$	110		$	80		$	249		$	192		Net investment gains (losses)
Net unrealized investment gains (losses)	17			59			57			85			Net investment income
Net unrealized investment gains (losses)	50			37			(16		)	72			Net derivative gains (losses)
Net unrealized investment gains (losses), before income tax	177			176			290			349
Income tax (expense) benefit	(65		)	(55		)	(100		)	(114		)
Net unrealized investment gains (losses), net of income tax	$	112		$	121		$	190		$	235
Unrealized gains (losses) on derivatives - cash flow hedges:
Interest rate swaps	$	7		$	12		$	12		$	27		Net derivative gains (losses)
Interest rate swaps	3			2			6			4			Net investment income
Interest rate forwards	1			2			4			2			Net derivative gains (losses)
Interest rate forwards	1			1			2			2			Net investment income
Interest rate forwards	—			1			1			1			Other expenses
Foreign currency swaps	290			62			(277		)	98			Net derivative gains (losses)
Foreign currency swaps	(1		)	—			(1		)	(1		)	Net investment income
Foreign currency swaps	1			—			1			1			Other expenses
Credit forwards	1			—			1			—			Net investment income
Gains (losses) on cash flow hedges, before income tax	303			80			(251		)	134
Income tax (expense) benefit	(95		)	(25		)	101			(44		)
Gains (losses) on cash flow hedges, net of income tax	$	208		$	55		$	(150	)	$	90
Foreign translation adjustment	—			(77		)	—			(77		)	Net investment gains (losses)
Income tax (expense) benefit	—			27			—			27
Foreign translation adjustment, net of income tax	—			(50		)	—			(50		)
Defined benefit plans adjustment: (1)
Amortization of net actuarial gains (losses)	$	(58	)	$	(47	)	$	(116	)	$	(91	)
Amortization of prior service (costs) credit	1			1			2			—
Amortization of defined benefit plan items, before  income tax	(57		)	(46		)	(114		)	(91		)
Income tax (expense) benefit	19			16			39			32
Amortization of defined benefit plan items, net of income tax	$	(38	)	$	(30	)	$	(75	)	$	(59	)
Total reclassifications, net of income tax	$	282		$	96		$	(35	)	$	216

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(1) These AOCI components are included in the computation of net periodic benefit costs. See Note 11.