-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QDYEOlY1K96KRu+2ePLRbVrXdGQ0MHaBb2vX4wHTIwwAzoMkQF35iugQYDMu78kY fr1cMqlLZ8eFVb5/0axb+g== 0000950123-05-009071.txt : 20050728 0000950123-05-009071.hdr.sgml : 20050728 20050728172949 ACCESSION NUMBER: 0000950123-05-009071 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20050728 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050728 DATE AS OF CHANGE: 20050728 FILER: COMPANY DATA: COMPANY CONFORMED NAME: METLIFE INC CENTRAL INDEX KEY: 0001099219 STANDARD INDUSTRIAL CLASSIFICATION: INSURANCE AGENTS BROKERS & SERVICES [6411] IRS NUMBER: 134075851 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-15787 FILM NUMBER: 05982189 BUSINESS ADDRESS: STREET 1: 200 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10166 BUSINESS PHONE: 2125782211 MAIL ADDRESS: STREET 1: 200 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10166 8-K 1 y11164e8vk.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported) July 28, 2005 MetLife, Inc. - -------------------------------------------------------------------------------- (Exact Name of Registrant as Specified in Its Charter) Delaware - -------------------------------------------------------------------------------- (State or Other Jurisdiction of Incorporation) 1-15787 13-4075851 - -------------------------------------------------------------------------------- (Commission File Number) (IRS Employer Identification No.) 200 Park Avenue, New York, New York 10166-0188 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) 212-578-2211 - -------------------------------------------------------------------------------- (Registrant's Telephone Number, Including Area Code) N/A - -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02. Results of Operations and Financial Condition. On July 28, 2005, MetLife, Inc., a Delaware Corporation, issued (i) a press release announcing its results for the quarter ended June 30, 2005, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference, and (ii) a Quarterly Financial Supplement for the quarter ended June 30, 2005, a copy of which is attached hereto as Exhibit 99.2 and is incorporated herein by reference. The press release and the Quarterly Financial Supplement are furnished and not filed pursuant to Instruction B.2 of Form 8-K. Item 9.01. Financial Statements and Exhibits. (a) Not applicable (b) Not applicable (c) 99.1 Press Release of MetLife, Inc. dated July 28, 2005, announcing second quarter 2005 results. 99.2 Quarterly Financial Supplement for the quarter ended June 30, 2005. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. METLIFE, INC. By: /s/ Gwenn L. Carr ------------------------------------------ Name: Gwenn L. Carr Title: Senior Vice-President and Secretary Date: July 28, 2005 EXHIBIT INDEX ------------- Exhibit Number Exhibit - ------- ------- 99.1 Press Release of MetLife, Inc. dated July 28, 2005, announcing second quarter 2005 results. 99.2 Quarterly Financial Supplement for the quarter ended June 30, 2005. EX-99.1 2 y11164exv99w1.txt EX-99.1: PRESS RELEASE EXHIBIT 99.1 PUBLIC RELATIONS MetLife, Inc. For Immediate Release One MetLife Plaza 27-01 Queens Plaza North Long Island City, NY 11101 [METLIFE LOGO] Contacts: For Media: John Calagna (212) 578-6252 For Investors: Tracey Dedrick (212) 578-5140 METLIFE ANNOUNCES SECOND QUARTER 2005 RESULTS GAINS ON REAL ESTATE SALES CONTRIBUTE TO RECORD NET INCOME PER COMMON SHARE OF $3.02 REPORTS RECORD OPERATING EARNINGS PER COMMON SHARE OF $1.17, A 16% INCREASE NEW YORK, July 28, 2005 - MetLife, Inc. (NYSE: MET) today reported second quarter 2005 net income of $2.2 billion, or $3.02 per diluted common share, compared with $954 million, or $1.26 per diluted common share, for the second quarter of 2004.
For the three months ended June 30, ----------------------------------- 2005 2004 --------- ------- (Dollars in millions, except per common share data) Net income(1) $ 2,245 $ 954 Net income per diluted common share $ 3.02 $ 1.26 Operating earnings available to common shareholders(2) $ 869 $ 766 Operating earnings per diluted common share(2) $ 1.17 $ 1.01 Book value per diluted common share $ 35.16 $ 28.23 Book value per diluted common share, excluding accumulated other comprehensive income per diluted common share(2) $ 31.02 $ 25.96
(1) $1.2 billion, net of income taxes, in gains on the sale of real estate are included in net income for the three months ended June 30, 2005. (2) Operating earnings, operating earnings available to common shareholders, operating earnings per diluted common share and book value per diluted common share (excluding accumulated other comprehensive income per diluted common share) are not calculated based on generally accepted accounting principles ("GAAP"). Information regarding non-GAAP financial measures and the reconciliation to GAAP measures in this press release are provided in the Non-GAAP and Other Financial Disclosures section below, as well as in the tables that accompany this release. SECOND QUARTER HIGHLIGHTS - - Achieved record quarterly net income of $2.2 billion, which includes $1.2 billion of net investment gains, net of income taxes, from the sale of real estate - - Earned total premiums, fees and other revenues of $7.1 billion, a 13% increase over the prior year period - - Continued strong investment spreads "MetLife delivered outstanding results as we achieved record net income and operating earnings available to common shareholders for the second consecutive quarter," said Robert H. Benmosche, chairman and chief executive officer of MetLife, Inc. "Our diverse institutional and retail businesses in the U.S. and abroad continued to deliver strong, top-line results. In addition to leveraging the benefits of the Travelers acquisition, we are well positioned to expand our customer base by offering a variety of financial products, services and solutions that build financial freedom." Operating earnings available to common shareholders for the second quarter of 2005 were $869 million, or $1.17 per diluted common share, compared with $766 million, or $1.01 per diluted common share, for the prior year period. SECOND QUARTER SEGMENT OVERVIEW Reconciliations of segment net income to segment operating earnings available to common shareholders are provided in the tables that accompany this release. INSTITUTIONAL BUSINESS EARNINGS UP 13% Institutional Business operating earnings for the second quarter of 2005 were $358 million, compared with $317 million in the prior year period. The improvement in earnings was primarily due to retirement & savings, which experienced strong interest spreads, and the non-medical & health business, which had favorable underwriting results. This was partially offset by a higher than normal level of large group life claims. Operating earnings in the prior year period benefited from a $31 million reduction, net of income taxes, to a previously established premium tax liability in group life. During the quarter, group life premiums, fees and other revenues grew 8% over the prior year period primarily due to growth from sales, strong retention and favorable renewal activity on large participating business. Retirement & savings net investment income grew 22% compared to the prior year period largely due to higher corporate joint venture income and an increase in the asset base driven by favorable sales, particularly in guaranteed interest contracts and the structured settlement business. Non-medical health premiums, fees and other revenues increased 15% over the prior year period due to continued growth across all product lines, particularly in the disability, long-term care and dental businesses. INDIVIDUAL BUSINESS EARNINGS UP 28% Individual Business operating earnings were $278 million in the second quarter of 2005, compared with $217 million in the prior year period. Results in Individual Business were driven primarily by growth in the annuity business and higher interest spreads. Traditional life results reflected the continuing decline in revenues from the company's closed block business while variable/universal life results were up over the prior year period primarily due to growth in the business. Fees 2 for the investment-type products within the annuity business increased by 27% compared with the prior year period. Traditional life first year premiums and deposits were up 11%, driven by higher term life sales. Declines in variable/universal life premiums and deposits were driven by lackluster interest in variable life products and a decrease in high initial premium universal life sales. AUTO & HOME EARNINGS UP 42% Auto & Home operating earnings were $101 million in the second quarter of 2005, compared with $71 million in the prior year period. Auto & Home's record results during the quarter benefited from an improved non-catastrophe combined ratio (86.4%), which resulted from lower homeowners claim frequencies, moderate auto claim severity, and favorable claim development related to prior accident years. Catastrophes for the second quarter of 2005 were also unusually low. INTERNATIONAL EARNINGS UP 22% International operating earnings were $50 million in the second quarter of 2005, compared with $41 million in the prior year period. Overall business growth in Latin America and Asia contributed to the segment's growth during the quarter. INVESTMENTS During the second quarter of 2005, the company completed the sale of One Madison Avenue and 200 Park Avenue in New York City. Combined, the sales resulted in a net investment gain of $1.2 billion, net of income taxes. During the quarter, derivative gains, net of income taxes, of $249 million were primarily related to interest rate and foreign currency movements on positions which did not qualify for hedge accounting. In addition, variable income was at higher than normal levels, primarily from corporate joint ventures. SUBSEQUENT EVENT On July 1, 2005, MetLife completed its acquisition of Travelers Life & Annuity and substantially all of Citigroup's international insurance businesses for $11.8 billion. As part of the consideration, the company issued $1 billion in MetLife common stock, valued at $44.57 per common share, to Citigroup. Earnings Conference Call MetLife will hold its second quarter earnings conference call and audio Webcast on Friday, July 29, 2005, from 8:00 to 9:00 a.m. (ET). The conference call will be available live via telephone and the Internet. To listen over the telephone, dial (612) 326-1003 (domestic and international callers). To listen to the conference call over the Internet, visit www.metlife.com (through a link on the Investor Relations page). Non-GAAP and Other Financial Disclosures MetLife analyzes its performance using non-GAAP measures called operating earnings, operating earnings available to common shareholders and operating earnings per diluted common share. Operating earnings is defined as GAAP net income excluding net investment gains and losses, net of income taxes, adjustments related to net investment gains and losses, net of income taxes, the impact from the cumulative effect of a change in accounting, net of income taxes, and discontinued operations, net of income taxes. 3 Scheduled settlement payments on derivative instruments not qualifying for hedge accounting treatment are included in operating earnings. Operating earnings available to common shareholders is defined as operating earnings less preferred stock dividends. Operating earnings per diluted common share is calculated by dividing operating earnings by the number of weighted average diluted common shares outstanding for the period indicated. MetLife believes these measures enhance the understanding and comparability of its performance by excluding net investment gains and losses, net of income taxes, and adjustments related to net investment gains and losses, net of income taxes, both of which can fluctuate significantly from period to period, the impact of the cumulative effect of a change in accounting, net of income taxes, and discontinued operations, net of income taxes, thereby highlighting the results from operations and the underlying profitability drivers of the business. Operating earnings, operating earnings available to common shareholders and operating earnings per diluted common share should not be viewed as substitutes for GAAP net income, GAAP net income available to common shareholders and GAAP net income per diluted common share, respectively.
For the three months ended June 30, ------------------------------------------------- 2005 2004 --------------------- ----------------------- (Dollars in millions, except per common share data) Net income available to common shareholders $ 2,245 $ 3.02 $ 954 $ 1.26 Net investment (gains) losses, net of income taxes(1) (1,439) (1.94) (102) (0.13) Adjustments related to net investment (gains) losses, net of income taxes(2) 63 0.09 (72) (0.10) Discontinued operations, net of income taxes(3) - - (14) (0.02) ------- --------- --------- -------- Operating earnings available to common shareholders $ 869 $ 1.17 $ 766 $ 1.01 ======= ========= ========= ======== Book value per diluted common share $ 35.16 $ 28.23 Accumulated other comprehensive income per diluted common share 4.14 2.27 ------- --------- Book value per diluted common share, excluding accumulated other comprehensive income per diluted common share $ 31.02 $ 25.96 ======= =========
(1) Net investment (gains) losses, net of income taxes, includes (gains) losses on sales of real estate and real estate joint ventures related to discontinued operations of $(1,219) million and $(85) million for the three months ended June 30, 2005 and 2004, respectively and excludes (gains) losses of $(8) million and $(14) million for the three months ended June 30, 2005 and 2004, respectively, from scheduled settlement payments on derivative instruments not qualifying for hedge accounting treatment. (2) Adjustments related to net investment (gains) losses, net of income taxes, include amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. (3) Excludes (gains) losses on sales of real estate and real estate joint ventures related to discontinued operations. 4
For the six months ended June 30, ------------------------------------------------- 2005 2004 --------------------- ----------------------- (Dollars in millions, except per common share data) Net income available to common shareholders $ 3,232 $ 4.35 $ 1,552 $ 2.04 Net investment (gains) losses, net of income taxes(1) (1,418) (1.91) (178) (0.23) Adjustments related to net investment (gains) losses, net of income taxes(2) 27 0.04 (81) (0.11) Cumulative effect of a change in accounting, net of income taxes(3) - - 86 0.11 Discontinued operations, net of income taxes(4) (151) (0.20) (18) (0.02) ------- --------- --------- -------- Operating earnings available to common shareholders $ 1,690 $ 2.28 $ 1,361 $ 1.79 ======= ========= ========= ========
(1) Net investment (gains) losses, net of income taxes, includes (gains) losses on sales of real estate and real estate joint ventures related to discontinued operations of $(1,231) million and $(98) million for the six months ended June 30, 2005 and 2004, respectively and excludes (gains) losses of $(24) million and $(23) million for the six months ended June 30, 2005 and 2004, respectively, from scheduled settlement payments on derivative instruments not qualifying for hedge accounting treatment. (2) Adjustments related to net investment (gains) losses, net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. (3) The cumulative effect of a change in accounting, net of income taxes, for the six months ended June 30, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Non-Traditional Long-Duration Contracts and for Separate Accounts. (4) Excludes (gains) losses on sales of real estate and real estate joint ventures related to discontinued operations. This release contains statements which constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to trends in the company's operations and financial results and the business and the products of the company and its subsidiaries, as well as other statements including words such as "anticipate," "believe," "plan," "estimate," "expect," "intend" and other similar expressions. Forward-looking statements are made based upon management's current expectations and beliefs concerning future developments and their potential effects on the company. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those included in the forward-looking statements as a result of risks and uncertainties including, but not limited to the following: (i) changes in general economic conditions, including the performance of financial markets and interest rates; (ii) heightened competition, including with respect to pricing, entry of new competitors and the development of new products by new and existing competitors; (iii) unanticipated changes in industry trends; (iv) the company's primary reliance, as a holding company, on dividends from its subsidiaries to meet debt payment obligations and the applicable regulatory restrictions on the ability of the subsidiaries to pay such dividends; (v) deterioration in the experience of the "closed block" established in connection with the reorganization of Metropolitan Life Insurance Company; (vi) catastrophe losses; (vii) adverse results or other consequences from litigation, 5 arbitration or regulatory investigations; (viii) regulatory, accounting or tax changes that may affect the cost of, or demand for, the company's products or services; (ix) downgrades in the company's and its affiliates' claims paying ability, financial strength or credit ratings; (x) changes in rating agency policies or practices; (xi) discrepancies between actual claims experience and assumptions used in setting prices for the company's products and establishing the liabilities for the company's obligations for future policy benefits and claims; (xii) discrepancies between actual experience and assumptions used in establishing liabilities related to other contingencies or obligations; (xiii) the effects of business disruption or economic contraction due to terrorism or other hostilities; (xiv) the company's ability to identify and consummate on successful terms any future acquisitions, and to successfully integrate acquired businesses with minimal disruption; and (xv) other risks and uncertainties described from time to time in the company's filings with the Securities and Exchange Commission, including its S-1 and S-3 registration statements. The company specifically disclaims any obligation to update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. MetLife, Inc. is a leading provider of insurance and other financial services to millions of individual and institutional customers throughout the United States. Through its subsidiaries and affiliates, MetLife, Inc. offers life insurance, annuities, automobile and homeowner's insurance and retail banking services to individuals, as well as group insurance, reinsurance and retirement and savings products and services to corporations and other institutions. Outside the U.S., the MetLife companies have direct insurance operations in Asia Pacific, Latin America and Europe. For more information, please visit www.metlife.com. For a copy of MetLife's Quarterly Financial Supplement, please visit www.metlife.com. # # # 6 MetLife, Inc. Consolidated Statements of Income Unaudited (Dollar amounts in millions)
Three months ended June 30, Six months ended June 30, -------------------------- ------------------------- 2005 2004 2005 2004 --------- ------- -------- -------- Premiums $ 6,019 $ 5,337 $ 12,021 $ 10,723 Universal life and investment-type product policy fees 814 721 1,605 1,384 Net investment income 3,482 3,082 6,699 6,020 Other revenues 301 284 600 597 Net investment gains (losses) 333 47 318 163 -------- ------- -------- -------- Total revenues 10,949 9,471 21,243 18,887 -------- ------- -------- -------- Policyholder benefits and claims 6,238 5,377 12,200 10,852 Interest credited to policyholder account balances 820 743 1,615 1,481 Policyholder dividends 420 420 835 845 Other expenses 2,008 1,866 3,981 3,717 -------- ------- -------- -------- Total expenses 9,486 8,406 18,631 16,895 -------- ------- -------- -------- Income from continuing operations before provision for income taxes 1,463 1,065 2,612 1,992 Provision for income taxes 454 237 804 527 -------- ------- -------- -------- Income from continuing operations 1,009 828 1,808 1,465 Income from discontinued operations, net of income taxes 1,236 126 1,424 173 -------- ------- -------- -------- Income before cumulative effect of a change in accounting, net of income taxes 2,245 954 3,232 1,638 Cumulative effect of a change in accounting, net of income taxes (4) - - - (86) -------- ------- -------- -------- Net income 2,245 954 3,232 1,552 Preferred stock dividend - - - - -------- ------- -------- -------- Net income available to common shareholders $ 2,245 $ 954 $ 3,232 $ 1,552 ======== ======= ======== ======== OPERATING EARNINGS RECONCILIATION Net income available to common shareholders $ 2,245 $ 954 $ 3,232 $ 1,552 Net investment gains (losses) 2,225 157 2,204 280 Minority interest - net investment gains (losses) (2) (8) (11) (16) Net investment gains (losses) tax benefit (provision) (784) (47) (775) (86) -------- ------- -------- -------- Net investment gains (losses), net of income taxes (1) (2) 1,439 102 1,418 178 Adjustments related to policyholder benefits and dividends (86) 116 (16) 147 Adjustments related to other expenses (9) (5) (24) (22) Adjustments related to tax benefit (provision) 32 (39) 13 (44) -------- ------- -------- -------- Adjustments related to net investment gains (losses), net of income taxes (3) (63) 72 (27) 81 Cumulative effect of a change in accounting, net of income taxes (4) - - - (86) Discontinued operations, net of income taxes (5) - 14 151 18 -------- ------- -------- -------- Operating earnings 869 766 1,690 1,361 Preferred stock dividend - - - - -------- ------- -------- -------- Operating earnings available to common shareholders $ 869 $ 766 $ 1,690 $ 1,361 ======== ======= ======== ========
(1) Net investment gains (losses), net of income taxes, includes gains (losses) on sales of real estate and real estate joint ventures related to discontinued operations, of $1,219 million and $1,231 million, respectively, for the three months and six months ended June 30, 2005 and $85 million and $98 million, respectively, for the three months and six months ended June 30, 2004. (2) Net investment gains (losses), net of income taxes, excludes gains (losses) of $8 million and $24 million, respectively, for the three months and six months ended June 30, 2005 and $14 million and $23 million, respectively, for the three months and six months ended June 30, 2004 from scheduled settlement payments on derivative instruments not qualifying for hedge accounting treatment. (3) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. (4) The cumulative effect of a change in accounting, net of income taxes, for the six months ended June 30, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. (5) Excludes gains (losses) on sale of real estate and real estate joint ventures related to discontinued operations. MetLife, Inc. Financial Highlights Unaudited (Dollar amounts in millions, except per common share data or unless otherwise noted)
At or for the three months At or for the six months ended June 30, ended June 30, ------------------ ------------------ 2005 2004 2005 2004 ------ ------ ------ ------ Other Financial Data: Net income available to common shareholders $2,245 $ 954 $3,232 $1,552 Operating earnings available to common shareholders $ 869 $ 766 $1,690 $1,361 Total assets under management (billions) $381.4 $ 338.0 $ 381.4 $ 338.0 Individual Business Sales Data: Total first year life premiums and deposits $ 213 $ 273 $ 420 $ 476 Variable and Universal life first year premiums and deposits (including COLI/BOLI) $ 161 $ 226 $ 321 $ 384 Total annuity deposits $2,496 $2,882 $5,036 $6,318 Mutual fund sales $ 916 $ 864 $1,870 $1,909 Earnings Per Share Calculation: Weighted average common shares outstanding - diluted 743.1 758.0 742.3 759.4 Operating earnings available to common shareholders per common share - diluted $ 1.17 $ 1.01 $ 2.28 $ 1.79 Net income available to common shareholders per common share - diluted $ 3.02 $ 1.26 $ 4.35 $ 2.04
MetLife, Inc. Balance Sheet Data June 30, 2005 (Unaudited) and December 31, 2004 (Audited) (Dollar amounts in millions)
At At June 30, December 31, 2005 2004 --------- --------- Balance Sheet Data: General account assets $ 291,972 $ 270,039 Separate account assets 89,459 86,769 --------- --------- Total assets $ 381,431 $ 356,808 ========= ========= Policyholder liabilities (including amounts of closed block) $ 200,782 $ 194,128 Short-term debt 1,979 1,445 Long-term debt 9,304 7,412 Junior subordinated debt securities underlying common equity units 2,134 - Shares subject to mandatory redemption 278 278 Other liabilities 49,324 43,952 Separate account liabilities 89,459 86,769 --------- --------- Total liabilities 353,260 333,984 --------- --------- Preferred stock, at par value 1 - Common stock, at par value 8 8 Additional paid-in capital 16,974 15,037 Retained earnings 9,840 6,608 Treasury stock (1,733) (1,785) Accumulated other comprehensive income 3,081 2,956 --------- --------- Total stockholders' equity 28,171 22,824 --------- --------- Total liabilities and stockholders' equity $ 381,431 $ 356,808 ========= =========
MetLife, Inc. Reconciliations of Net Income Available to Common Shareholders to Operating Earnings Available to Common Shareholders Unaudited (Dollar amounts in millions)
Three months ended Six months ended June 30, June 30, ----------------- ------------------ 2005 2004 2005 2004 ----- ----- ----- ----- Total Institutional Operations Net income available to common shareholders $ 607 $ 377 $ 956 $ 687 Net investment gains (losses), net of income taxes 273 9 275 73 Adjustments related to net investment gains (losses), net of income taxes (24) 51 (1) 40 Cumulative effect of a change in accounting, net of income taxes - - - (60) ----- ----- ----- ----- Operating earnings available to common shareholders $ 358 $ 317 $ 682 $ 634 ===== ===== ===== ===== Institutional Operations Group Life Net income available to common shareholders $ 80 $ 126 $ 170 $ 220 Net investment gains (losses), net of income taxes - (4) (10) 13 ----- ----- ----- ----- Operating earnings available to common shareholders $ 80 $ 130 $ 180 $ 207 ===== ===== ===== ===== Retirement & Savings Net income available to common shareholders $ 431 $ 183 $ 616 $ 353 Net investment gains (losses), net of income taxes 237 28 250 60 Adjustments related to net investment gains (losses), net of income taxes (10) 20 1 20 Cumulative effect of a change in accounting, net of income taxes - - - (40) ----- ----- ----- ----- Operating earnings available to common shareholders $ 204 $ 135 $ 365 $ 313 ===== ===== ===== ===== Non-Medical Health & Other Net income available to common shareholders $ 96 $ 68 $ 170 $ 114 Net investment gains (losses), net of income taxes 36 (15) 35 - Adjustments related to net investment gains (losses), net of income taxes (14) 31 (2) 20 Cumulative effect of a change in accounting, net of income taxes - - - (20) ----- ----- ----- ----- Operating earnings available to common shareholders $ 74 $ 52 $ 137 $ 114 ===== ===== ===== ===== Total Individual Operations Net income available to common shareholders $ 564 $ 246 $ 929 $ 435 Net investment gains (losses), net of income taxes 321 32 353 13 Adjustments related to net investment gains (losses), net of income taxes (35) (3) (20) 18 ----- ----- ----- ----- Operating earnings available to common shareholders $ 278 $ 217 $ 596 $ 404 ===== ===== ===== ===== Individual Operations Traditional Life Net income available to common shareholders $ 268 $ 93 $ 437 $ 164 Net investment gains (losses), net of income taxes 223 20 268 5 Adjustments related to net investment gains (losses), net of income taxes (22) (4) (7) 18 ----- ----- ----- ----- Operating earnings available to common shareholders $ 67 $ 77 $ 176 $ 141 ===== ===== ===== ===== Variable & Universal Life Net income available to common shareholders $ 46 $ 29 $ 87 $ 44 Net investment gains (losses), net of income taxes 9 (5) 1 (2) Adjustments related to net investment gains (losses), net of income taxes (2) 2 (4) 1 Cumulative effect of a change in accounting, net of income taxes - - - (11) ----- ----- ----- ----- Operating earnings available to common shareholders $ 39 $ 32 $ 90 $ 56 ===== ===== ===== ===== Annuities Net income available to common shareholders $ 258 $ 117 $ 408 $ 215 Net investment gains (losses), net of income taxes 94 17 95 19 Adjustments related to net investment gains (losses), net of income taxes (11) (1) (9) (1) Cumulative effect of a change in accounting, net of income taxes - - - 11 ----- ----- ----- ----- Operating earnings available to common shareholders $ 175 $ 101 $ 322 $ 186 ===== ===== ===== ===== Other Net income (loss) available to common shareholders $ (8) $ 7 $ (3) $ 12 Net investment gains (losses), net of income taxes (5) - (11) (9) ----- ----- ----- ----- Operating earnings (loss) available to common shareholders $ (3) $ 7 $ 8 $ 21 ===== ===== ===== ===== Total Auto & Home Net income available to common shareholders $ 98 $ 68 $ 174 $ 114 Net investment gains (losses), net of income taxes (3) (3) (3) (3) ----- ----- ----- ----- Operating earnings available to common shareholders $ 101 $ 71 $ 177 $ 117 ===== ===== ===== ===== Auto & Home Auto Net income available to common shareholders $ 65 $ 58 $ 108 $ 80 Net investment gains (losses), net of income taxes (2) (3) (2) (3) ----- ----- ----- ----- Operating earnings available to common shareholders $ 67 $ 61 $ 110 $ 83 ===== ===== ===== =====
Three months ended Six months ended June 30, June 30, ----------------- ------------------ 2005 2004 2005 2004 ----- ----- ----- ----- Homeowners Net income available to common shareholders $ 32 $ 12 $ 63 $ 34 Net investment gains (losses), net of income taxes (1) - (1) - ----- ----- ----- ----- Operating earnings available to common shareholders $ 33 $ 12 $ 64 $ 34 ===== ===== ===== ===== Other Net income (loss) available to common shareholders $ 1 $ (2) $ 3 $ - Net investment gains (losses), net of income taxes - - - - ----- ----- ----- ----- Operating earnings (loss) available to common shareholders $ 1 $ (2) $ 3 $ - ===== ===== ===== ===== International Net income available to common shareholders $ 45 $ 70 $ 121 $ 106 Net investment gains (losses), net of income taxes 5 (3) 5 17 Adjustments related to net investment gains (losses), net of income taxes (10) 32 (1) 34 Cumulative effect of a change in accounting, net of income taxes - - - (30) ----- ----- ----- ----- Operating earnings available to common shareholders $ 50 $ 41 $ 117 $ 85 ===== ===== ===== ===== Reinsurance Net income available to common shareholders $ 6 $ 30 $ 37 $ 59 Net investment gains (losses), net of income taxes (3) 15 12 24 Adjustments related to net investment gains (losses), net of income taxes 6 (8) (5) (11) Cumulative effect of a change in accounting, net of income taxes - - - 5 ----- ----- ----- ----- Operating earnings available to common shareholders $ 3 $ 23 $ 30 $ 41 ===== ===== ===== =====
EX-99.2 3 y11164exv99w2.txt EX-99.2: QUARTERLY FINANCIAL SUPPLEMENT (METLIFE LOGO) EXHIBIT 99.2 SECOND QUARTER FINANCIAL SUPPLEMENT JUNE 30, 2005 2 (SNOOPY GRAPHIC) PEANUTS (C) United Feature Syndicate, Inc. (METLIFE LOGO) TABLE OF CONTENTS HIGHLIGHTS Corporate Overview 2 METLIFE, INC. Consolidated Balance Sheets 3 Consolidated Statements of Operating Earnings 4 Consolidating Balance Sheet 5 Consolidating Statement of Operating Earnings 6 SUMMARY OF SEGMENT OPERATING EARNINGS 10 INSTITUTIONAL OPERATIONS Statements of Operating Earnings 11 Premiums, Fees and Other Revenues by Product and Additional Statistical Information 15 Future Policy Benefits and Policyholder Account Balances and Separate Account Liabilities 16 Other Expenses by Major Category 17 Spreads by Product 18 INDIVIDUAL OPERATIONS Statements of Operating Earnings 19 Premiums and Deposits by Product and Mutual Fund Sales 24 Additional Statistical Information 25 Future Policy Benefits and Policyholder Account Balances and Separate Account Liabilities 26 Insurance Expenses and Other Expenses by Major Category 27 Spreads by Product 28 AUTO & HOME OPERATIONS Statements of Operating Earnings 29 Written Premiums by Product and Selected Financial Information and Supplemental Data 33 INTERNATIONAL OPERATIONS Statement of Operating Earnings 34 REINSURANCE OPERATIONS Statement of Operating Earnings 35 Pre-Tax and Pre-Minority Interest Operating Earnings by Region and Reserves by Region 36 CORPORATE, OTHER & ELIMINATIONS Statement of Operating Earnings 37 METLIFE, INC. Investment Results by Asset Category and Annualized Yields 38 Fixed Maturities and Equity Securities Gross Unrealized Gains and Losses Aging Schedule 40 Summary of Fixed Maturities Available for Sale by Sector and Quality Distribution, and Summary of Commercial Mortgage Loans by Region and Property Type 41 Summary of Real Estate, Summary of Mortgages and Consumer Loans and Distribution of Assets Under Management 42 OTHER INFORMATION Company Ratings 43
NOTE: THE QUARTERLY FINANCIAL SUPPLEMENT ("QFS") INCLUDES FINANCIAL MEASURES, "OPERATING EARNINGS," "OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS" AND "OPERATING EARNINGS PER DILUTED COMMON SHARE," THAT ARE NOT BASED ON GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ("GAAP"). "OPERATING EARNINGS" IS DEFINED AS GAAP NET INCOME EXCLUDING NET INVESTMENT GAINS AND LOSSES, NET OF INCOME TAXES, ADJUSTMENTS RELATED TO NET INVESTMENT GAINS AND LOSSES, NET OF INCOME TAXES, THE IMPACT FROM THE CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING, NET OF INCOME TAXES, AND DISCONTINUED OPERATIONS, NET OF INCOME TAXES. SCHEDULED SETTLEMENT PAYMENTS ON DERIVATIVE INSTRUMENTS NOT QUALIFYING FOR HEDGE ACCOUNTING TREATMENT ARE INCLUDED IN OPERATING EARNINGS. "OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS" IS DEFINED AS OPERATING EARNINGS LESS PREFERRED STOCK DIVIDENDS. "OPERATING EARNINGS PER DILUTED COMMON SHARE" IS CALCULATED BY DIVIDING OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS BY THE NUMBER OF WEIGHTED AVERAGE DILUTED COMMON SHARES OUTSTANDING FOR THE PERIOD INDICATED. METLIFE BELIEVES THESE MEASURES ENHANCE THE UNDERSTANDING AND COMPARABILITY OF ITS PERFORMANCE BY EXCLUDING NET INVESTMENT GAINS AND LOSSES, NET OF INCOME TAXES, AND ADJUSTMENTS RELATED TO NET INVESTMENT GAINS AND LOSSES, NET OF INCOME TAXES, BOTH OF WHICH CAN FLUCTUATE SIGNIFICANTLY FROM PERIOD TO PERIOD, THE IMPACT OF THE CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING, NET OF INCOME TAXES, AND DISCONTINUED OPERATIONS, NET OF INCOME TAXES, THEREBY HIGHLIGHTING THE RESULTS FROM OPERATIONS AND THE UNDERLYING PROFITABILITY DRIVERS OF THE BUSINESS. OPERATING EARNINGS, OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS AND OPERATING EARNINGS PER DILUTED COMMON SHARE SHOULD NOT BE VIEWED AS SUBSTITUTES FOR GAAP NET INCOME, GAAP NET INCOME AVAILABLE TO COMMON SHAREHOLDERS AND GAAP NET INCOME PER DILUTED COMMON SHARE, RESPECTIVELY. RECONCILIATIONS OF OPERATING EARNINGS TO GAAP NET INCOME, OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS TO GAAP NET INCOME AVAILABLE TO COMMON SHAREHOLDERS AND OPERATING EARNINGS PER DILUTED COMMON SHARE TO GAAP NET INCOME PER DILUTED COMMON SHARE, THE MOST DIRECTLY COMPARABLE GAAP MEASURES, ARE INCLUDED IN THE QFS AND IN METLIFE'S EARNINGS PRESS RELEASE, DATED JULY 28, 2005, FOR THE QUARTER ENDED JUNE 30, 2005, WHICH ARE AVAILABLE AT WWW.METLIFE.COM. 1 (METLIFE LOGO) CORPORATE OVERVIEW Unaudited (Dollars and shares in millions, except per share data)
For the Three Months Ended ------------------------------------------------------------------ June 30, September 30, December 31, March 31, June 30, 2004 2004 2004 2005 2005 ------------------------------------------------------------------ Net income (1) $954 $695 $511 $987 $2,245 Preferred stock dividend 0 0 0 0 0 ------------------------------------------------------------------ Net income available to common shareholders 954 695 511 987 2,245 Net investment gains (losses) 157 178 (214) (21) 2,225 Minority interest - net investment gains (losses) (8) 2 5 (9) (2) Net investment gains (losses) tax benefit (provision) (47) (62) 71 9 (784) ------------------------------------------------------------------ Net investment gains (losses), net of income taxes (2) (3) (4) 102 118 (138) (21) 1,439 Adjustments related to policyholder benefits and dividends 116 (74) (9) 70 (86) Adjustments related to other expenses (5) 6 5 (15) (9) Adjustments related to tax benefit (provision) (39) 24 1 (19) 32 ------------------------------------------------------------------ Adjustments related to net investment gains (losses), net of income taxes (5) 72 (44) (3) 36 (63) Cumulative effect of a change in accounting, net of income taxes (6) 0 0 0 0 0 Discontinued operations, net of income taxes 14 5 (4) 151 0 ------------------------------------------------------------------ Operating earnings available to common shareholders $766 (7) $616 (8) $656 $821 $869(9) Net income available to common shareholders per common share - diluted $1.26 $0.92 $0.68 $1.33 $3.02 Net investment gains (losses), net of income taxes 0.13 0.15 (0.18) (0.03) 1.94 Adjustments related to net investment gains (losses), net of income taxes 0.10 (0.06) (0.01) 0.05 (0.09) Cumulative effect of a change in accounting, net of income taxes 0.00 0.00 0.00 0.00 0.00 Discontinued operations, net of income taxes 0.02 0.01 (0.01) 0.20 0.00 ------------------------------------------------------------------ Operating earnings available to common shareholders - diluted $1.01 $0.82 $0.88 $1.11 $1.17 ================================================================== Weighted average common shares outstanding - diluted 758.0 753.4 747.7 739.6 743.1 Book value per common share (actual common shares outstanding) $28.53 $30.86 $31.16 $31.43 $35.60 Book value per common share, excluding accumulated other comprehensive income (actual common shares outstanding) $26.24 $27.11 $27.12 $28.48 $31.41 Book value per common share - diluted (weighted average common shares outstanding) $28.23 $30.50 $30.53 $31.15 $35.16 Book value per common share, excluding accumulated other comprehensive income - diluted (weighted average common shares outstanding) $25.96 $26.79 $26.57 $28.23 $31.02 ------------------------------------------------------------------
For the Three Months Ended ------------------------------------------------------------------ June 30, September 30, December 31, March 31, June 30, 2004 2004 2004 2005 2005 ------------------------------------------------------------------ Common shares outstanding, beginning of period 755.4 750.0 744.5 732.5 733.1 Treasury stock (5.4) (5.5) (12.0) 0.6 0.8 ------------------------------------------------------------------ Common shares outstanding, end of period 750.0 744.5 732.5 733.1 733.9 Weighted average common shares outstanding - basic 754.5 749.2 742.3 734.0 736.5 Dilutive effect of convertible securities 0.0 0.0 0.0 0.0 0.0 Dilutive effect of stock options 3.5 4.2 5.4 5.6 6.4 Dilutive effect of LTPCP shares 0.0 0.0 0.0 0.0 0.2 ------------------------------------------------------------------ Weighted average common shares outstanding - diluted 758.0 753.4 747.7 739.6 743.1 ================================================================== Policyholder Trust Shares 335.0 325.1 321.3 315.4 310.9 SUPPLEMENTAL DATA Adjusted long-term debt to total capital (6) 21.9% 22.8% 25.2% 24.2% 29.4% ------------------------------------------------------------------
(1) Presentation of net income throughout the QFS differs from other public filings with respect to discontinued operations and scheduled settlement payments on derivatives not qualifying for hedge accounting treatment. Presentation of discontinued operations in other public filings is in accordance with the Statement of Financial Accounting Standards ("SFAS") No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. Presentation of scheduled settlement payments on derivatives not qualifying for hedge accounting treatment in other public filings is in accordance with SFAS No.133, Accounting for Derivative Instruments and Hedging Activities. (2) Net investment gains (losses), net of income taxes, excludes scheduled settlement payments on derivative instruments not qualifying for hedge accounting treatment of $14 million, $8 million, $2 million, $16 million and $8 million, for the three months ended June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. For QFS purposes, these settlements are included in net investment income. (3) Net investment gains (losses), net of income taxes, from real estate and real estate joint ventures includes discontinued operations of $85 million, ($10) million, $2 million $12 million and $1,219 million, for the three months ended June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. (4) Net investment gains (losses), net of income taxes, for the three months ended December 31, 2004, includes a charge of $17 million related to the value of an embedded derivative associated with a funds withheld reinsurance treaty that was converted to a coinsurance agreement. (5) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments related to the policyholder dividend obligation and amounts allocable to certain participating contracts. (6) Adjusted long-term debt at June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005 consists of $5,503 million, $6,004 million, $6,669 million $6,657 million and $8,319 million of long-term debt, respectively, $0, $0, $0, $0 and $2,134 million of junior subordinated debt securities underlying common equity units, and $36 million, $36 million, $111 million, $113 million and $115 million of adjusted short-term debt, respectively. Non-recourse debt not included in adjusted long-term debt consists of $723 million, $691 million, $743 million, $757 million and $985 million, respectively. Non-core borrowing not included in adjusted short-term debt consists of $3,182 million, $1,530 million, $1,334 million, $1,007 million and $1,864 million, respectively. Total capital is defined as adjusted long-term debt, shares subject to mandatory redemption and stockholders' equity net of accumulated other comprehensive income. (7) Operating earnings available to common shareholders and net income for the three months ended June 30, 2004 includes a $32 million charge, net of income taxes ($0.04 per diluted common share), from a contribution to the MetLife Foundation made by Metropolitan Life Insurance Company, a $31 million benefit, net of income taxes ($0.04 per diluted common share), from a reduction of a previously established premium tax liability and a $105 million benefit ($0.14 per diluted common share) related to a previously disclosed resolution of an IRS audit. (8) Operating earnings available to common shareholders for the three months ended September 30, 2004 includes a $9 million benefit ($0.01 per diluted common share), from a revision of the estimate of income taxes for 2003. (9) Operating earnings available to common shareholders for the three months ended June 30, 2005 includes a $30 million benefit, net of income taxes ($0.04 per diluted common share), associated with the reduction of a previously established liability for settlement death benefits related to the Company's sales practices class action settlement recorded in 1999, an $18 million benefit, net of income taxes ($0.02 per diluted common share), associated with the reduction of a previously established liability related to the Company's demutualization in 2000, and an $8 million charge, net of income taxes ($0.01 per diluted common share), associated with establishment of a liability associated with the Argentine pension business. 2 (METLIFE LOGO) METLIFE, INC. CONSOLIDATED BALANCE SHEETS
As of ------------------------------------------------------------ June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 --------------------------------------------------------------------------------------------------------------------------------- ASSETS (1) Fixed maturities, at fair value $170,192 $176,091 $176,763 $182,653 $185,218 Equity securities, at fair value 1,715 1,869 2,188 2,516 2,632 Mortgage and consumer loans 28,118 29,620 32,406 31,977 33,586 Policy loans 8,766 8,801 8,899 8,953 8,975 Real estate and real estate joint ventures 4,150 4,263 4,233 4,306 3,803 Other limited partnership interests 2,806 2,846 2,907 3,051 3,383 Short-term investments 2,077 2,451 2,663 2,551 2,170 Other invested assets 5,108 4,394 4,926 4,960 6,079 ------------------------------------------------------------ TOTAL INVESTMENTS 222,932 230,335 234,985 240,967 245,846 Cash and cash equivalents 4,424 3,592 4,051 3,925 13,608 Accrued investment income 2,330 2,491 2,338 2,433 2,450 Premiums and other receivables 7,370 7,089 6,696 7,515 7,822 Deferred policy acquisition costs 13,828 13,920 14,336 14,798 14,874 Assets of subsidiaries held-for-sale 196 217 379 0 0 Other assets 7,185 7,352 7,254 7,247 7,372 Separate account assets 79,747 81,181 86,769 85,786 89,459 ------------------------------------------------------------ TOTAL ASSETS $338,012 $346,177 $356,808 $362,671 $381,431 ============================================================ LIABILITIES AND EQUITY (1) LIABILITIES Future policy benefits $95,731 $98,197 $100,159 $100,630 $103,181 Policyholder account balances 79,943 81,798 83,570 85,802 $86,528 Other policyholder funds 6,920 7,036 7,258 7,530 7,657 Policyholder dividends payable 919 954 898 896 939 Policyholder dividend obligation 1,330 2,161 2,243 1,737 2,477 Short-term debt 3,218 1,566 1,445 1,120 1,979 Long-term debt 6,226 6,695 7,412 7,414 9,304 Junior subordinated debt securities underlying common equity units 0 0 0 0 2,134 Shares subject to mandatory redemption 277 277 278 278 278 Liabilities of subsidiaries held-for-sale 65 80 240 0 0 Current income tax payable 751 501 421 31 635 Deferred income tax payable 1,972 2,468 2,473 2,414 3,201 Payables under securities loaned transactions 28,132 28,662 28,678 31,713 31,632 Other liabilities 11,383 11,626 12,140 14,282 13,856 Separate account liabilities 79,747 81,181 86,769 85,786 89,459 ------------------------------------------------------------ TOTAL LIABILITIES 316,614 323,202 333,984 339,633 353,260 ------------------------------------------------------------ EQUITY Preferred stock, at par value 0 0 0 0 1 Common stock, at par value 8 8 8 8 8 Additional paid-in capital 15,013 15,027 15,037 15,043 16,974 Retained earnings 5,745 6,440 6,608 7,595 9,841 Treasury stock (1,085) (1,294) (1,785) (1,764) (1,733) Accumulated other comprehensive income 1,717 2,794 2,956 2,156 3,080 ------------------------------------------------------------ TOTAL EQUITY 21,398 22,975 22,824 23,038 28,171 ------------------------------------------------------------ TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $338,012 $346,177 $356,808 $362,671 $381,431 ============================================================
(1) Certain amounts in prior periods presented throughout the QFS have been reclassified to conform with current period presentation. 3 (METLIFE LOGO) METLIFE, INC. CONSOLIDATED STATEMENTS OF OPERATING EARNINGS
For the Three Months Ended ------------------------------------------------------------------ June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $5,337 $5,679 $5,802 $6,002 $6,019 Universal life and investment-type product policy fees 721 737 747 791 814 Investment income, net 3,157 3,107 3,346 3,280 3,507 Other revenues 283 292 310 299 301 ------------------------------------------------------------------ 9,498 9,815 10,205 10,372 10,641 ------------------------------------------------------------------ EXPENSES Policyholder benefits and dividends 5,914 6,260 6,291 6,447 6,572 Interest credited to policyholder account balances 743 739 778 795 820 Interest expense 108 113 116 119 125 Other expenses 1,754 1,829 2,068 1,830 1,872 ------------------------------------------------------------------ 8,519 8,941 9,253 9,191 9,389 ------------------------------------------------------------------ Operating earnings before provision for income taxes 979 874 952 1,181 1,252 Provision for income taxes 213 258 296 360 383 ------------------------------------------------------------------ Operating earnings 766 616 656 821 869 Preferred stock dividend 0 0 0 0 0 ------------------------------------------------------------------ OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $766 (2) $616 (3) $656 $821 $869 (4) ================================================================== NET INCOME RECONCILIATION Operating earnings available to common shareholders $766 $616 $656 $821 $869 Net investment gains (losses) 157 178 (214) (21) 2,225 Minority interest - net investment gains (losses) (8) 2 5 (9) (2) Net investment gains (losses) tax benefit (provision) (47) (62) 71 9 (784) ------------------------------------------------------------------ Net investment gains (losses), net of income taxes 102 118 (138) (21) 1,439 Adjustments related to policyholder benefits and dividends 116 (74) (9) 70 (86) Adjustments related to other expenses (5) 6 5 (15) (9) Adjustments related to tax benefit (provision) (39) 24 1 (19) 32 ------------------------------------------------------------------ Adjustments related to net investment gains (losses), net of income taxes (1) 72 (44) (3) 36 (63) Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 Discontinued operations, net of income taxes 14 5 (4) 151 0 ------------------------------------------------------------------ Net income available to common shareholders 954 695 511 987 2,245 Preferred stock dividend 0 0 0 0 0 ------------------------------------------------------------------ Net income $954 $695 $511 $987 $2,245 ------------------------------------------------------------------
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation, and amounts allocable to certain participating contracts. (2) Operating earnings available to common shareholders and net income for the three months ended June 30, 2004 includes a $32 million charge, net of income taxes, from a contribution to the MetLife Foundation made by Metropolitan Life Insurance Company, a $31 million benefit, net of income taxes, from a reduction of a previously established premium tax liability and a $105 million benefit related to a previously disclosed resolution of an IRS audit. (3) Operating earnings available to common shareholders for the three months ended September 30, 2004 includes a $9 million benefit from a revision of the estimate of income taxes for 2003. (4) Operating earnings available to common shareholders for the three months ended June 30, 2005 includes a $30 million benefit, net of income taxes, associated with the reduction of a previously established liability for settlement death benefits related to the Company's sales practices class action settlement recorded in 1999, an $18 million benefit, net of income taxes, associated with the reduction of a previously established liability related to the company's demutualization in 2000, and an $8 million charge, net of income taxes, associated with establishment of a liability associated with the Argentine pension business. 4 (METLIFE LOGO) METLIFE, INC. CONSOLIDATING BALANCE SHEET AT JUNE 30, 2005
Corporate, Other Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations - ------------------------------------------------------------------------------------------------------------------------------------ ASSETS Total investments $245,846 $90,497 $114,697 $3,908 $9,290 $11,057 $16,397 Cash and cash equivalents 13,608 (719) (291) (82) (236) 471 14,465 Accrued investment income 2,450 710 1,088 58 106 98 390 Premiums and other receivables 7,822 2,420 4,240 810 383 1,064 (1,095) Deferred policy acquisition costs 14,874 1,029 9,483 181 1,446 2,733 2 Assets of subsidiaries held-for-sale 0 0 0 0 0 0 0 Other assets 7,372 1,625 2,428 560 361 151 2,247 Separate account assets 89,459 37,208 50,892 0 1,345 14 0 -------------------------------------------------------------------------------------------------- Total Assets $381,431 $132,770 $182,537 $5,435 $12,695 $15,588 $32,406 ================================================================================================== LIABILITIES AND EQUITY LIABILITIES Future policy benefits $103,181 $37,307 $54,226 $3,233 $5,099 $4,640 ($1,324) Policyholder account balances 86,528 34,399 44,034 0 2,987 5,112 (4) Other policyholder funds 7,657 2,521 2,630 19 746 1,708 33 Policyholder dividends payable 939 0 938 0 1 9 (9) Policyholder dividend obligation 2,477 0 2,477 0 0 0 0 Short-term debt 1,979 72 717 0 0 0 1,190 Long-term debt 9,304 0 70 0 35 478 8,721 Junior subordinated debt securities underlying common equity units 2,134 0 0 0 0 0 2,134 Shares subject to mandatory redemption 278 0 0 0 0 158 120 Liabilities of subsidiaries held-for-sale 0 0 0 0 0 0 0 Current income tax payable 635 156 68 (1) (42) (121) 575 Deferred income tax payable 3,201 155 1,451 47 113 927 508 Payables under securities loaned transactions 31,632 11,169 14,179 99 0 0 6,185 Other liabilities 13,856 2,165 2,307 687 559 1,332 6,806 Separate account liabilities 89,459 37,208 50,892 0 1,346 13 0 -------------------------------------------------------------------------------------------------- Total Liabilities 353,260 125,152 173,989 4,084 10,844 14,256 24,935 EQUITY Preferred stock, at par value 1 0 0 0 0 0 1 Common stock, at par value 8 0 0 0 0 0 8 Allocated equity (1) 26,815 6,589 7,624 1,167 1,447 1,077 8,911 Treasury stock (1,733) 0 0 0 0 0 (1,733) Accumulated other comprehensive income 3,080 1,029 924 184 404 255 284 -------------------------------------------------------------------------------------------------- Total Stockholders' Equity 28,171 7,618 8,548 1,351 1,851 1,332 7,471 -------------------------------------------------------------------------------------------------- Total Liabilities and Stockholders' Equity $381,431 $132,770 $182,537 $5,435 $12,695 $15,588 $32,406 ==================================================================================================
(1) Allocated equity includes additional paid-in capital and retained earnings. 5 (METLIFE LOGO) METLIFE, INC. CONSOLIDATING STATEMENT OF OPERATING EARNINGS FOR THE THREE MONTHS ENDED JUNE 30, 2005
Corporate, Other Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $6,019 $2,833 $1,058 $738 $455 $932 $3 Universal life and investment-type product policy fees 814 180 506 0 126 2 0 Investment income, net 3,507 1,332 1,592 46 194 151 192 Other revenues 301 157 111 8 (1) 21 5 --------------------------------------------------------------------------------------------------- 10,641 4,502 3,267 792 774 1,106 200 --------------------------------------------------------------------------------------------------- EXPENSES Policyholder benefits and dividends 6,572 3,130 1,746 448 451 842 (45) Interest credited to policyholder account balances 820 312 409 0 55 44 0 Capitalization of deferred policy acquisition costs (858) (68) (279) (119) (138) (254) 0 Amortization of deferred policy acquisition costs 556 35 173 115 56 177 0 Other expenses 2,299 551 802 208 277 294 167 --------------------------------------------------------------------------------------------------- 9,389 3,960 2,851 652 701 1,103 122 --------------------------------------------------------------------------------------------------- Operating earnings before provision (benefit) for income taxes 1,252 542 416 140 73 3 78 Provision (benefit) for income taxes 383 184 138 39 23 0 (1) --------------------------------------------------------------------------------------------------- Operating earnings 869 358 278 101 50 3 79 Preferred stock dividend 0 0 0 0 0 0 0 --------------------------------------------------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $869 (2) $358 $278 $101 $50 $3 $79 =================================================================================================== NET INCOME RECONCILIATION Operating earnings available to common shareholders $869 $358 $278 $101 $50 $3 $79 Net investment gains (losses) 2,225 423 492 (4) 7 (7) 1,314 Minority interest - net investment gains (losses) (2) 0 0 0 0 (2) 0 Net investment gains (losses) tax benefit (provision) (784) (150) (171) 1 (2) 6 (468) --------------------------------------------------------------------------------------------------- Net investment gains (losses), net of income taxes 1,439 273 321 (3) 5 (3) 846 Adjustments related to policyholder benefits and dividends (86) (37) (33) 0 (16) 0 0 Adjustments related to other expenses (9) 0 (21) 0 0 12 0 Adjustments related to tax benefit (provision) 32 13 19 0 6 (6) 0 --------------------------------------------------------------------------------------------------- Adjustments related to net investment gains (losses), net of income taxes (1) (63) (24) (35) 0 (10) 6 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 --------------------------------------------------------------------------------------------------- Net income available to common shareholders 2,245 607 564 98 45 6 925 Preferred stock dividend 0 0 0 0 0 0 0 --------------------------------------------------------------------------------------------------- Net income $2,245 $607 $564 $98 $45 $6 $925 ===================================================================================================
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. (2) Operating earnings available to common shareholders for the three months ended June 30, 2005 includes a $30 million benefit, net of income taxes, associated with the reduction of a previously established liability for settlement death benefits related to the Company's sales practices class action settlement recorded in 1999, an $18 million benefit, net of income taxes, associated with the reduction of a previously established liability related to the company's demutualization in 2000, and an $8 million charge, net of income taxes, associated with establishment of a liability associated with the Argentine pension business. 6 (METLIFE LOGO) METLIFE, INC. CONSOLIDATING STATEMENT OF OPERATING EARNINGS FOR THE THREE MONTHS ENDED JUNE 30, 2004
Corporate, Other Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $5,337 $2,401 $1,007 $734 $392 $807 ($4) Universal life and investment-type product policy fees 721 182 453 0 86 0 0 Investment income, net 3,157 1,128 1,549 44 137 136 163 Other revenues 283 155 106 6 8 15 (7) -------------------------------------------------------------------------------------------------- 9,498 3,866 3,115 784 623 958 152 -------------------------------------------------------------------------------------------------- EXPENSES Policyholder benefits and dividends 5,914 2,713 1,653 495 400 651 2 Interest credited to policyholder account balances 743 232 427 0 32 52 0 Capitalization of deferred policy acquisition costs (852) (141) (298) (116) (93) (204) 0 Amortization of deferred policy acquisition costs 456 33 170 112 36 105 0 Other expenses 2,258 548 837 197 194 318 164 -------------------------------------------------------------------------------------------------- 8,519 3,385 2,789 688 569 922 166 -------------------------------------------------------------------------------------------------- Operating earnings before provision (benefit) for income taxes 979 481 326 96 54 36 (14) Provision (benefit) for income taxes 213 164 109 25 13 13 (111) -------------------------------------------------------------------------------------------------- Operating earnings 766 317 217 71 41 23 97 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $766 $317 $217 $71 $41 $23 $97 ================================================================================================== NET INCOME RECONCILIATION Operating earnings available to common shareholders $766 $317 $217 $71 $41 $23 $97 Net investment gains (losses) 157 18 31 (5) (2) 32 83 Minority interest - net investment gains (losses) (8) 0 0 0 0 (8) 0 Net investment gains (losses) tax benefit (provision) (47) (9) 1 2 (1) (9) (31) -------------------------------------------------------------------------------------------------- Net investment gains (losses), net of income taxes 102 9 32 (3) (3) 15 52 Adjustments related to policyholder benefits and dividends 116 78 (11) 0 49 0 0 Adjustments related to other expenses (5) 0 8 0 0 (13) 0 Adjustments related to tax benefit (provision) (39) (27) 0 0 (17) 5 0 -------------------------------------------------------------------------------------------------- Adjustments related to net investment gains (losses), net of income taxes (1) 72 51 (3) 0 32 (8) 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 14 0 0 0 0 0 14 -------------------------------------------------------------------------------------------------- Net income available to common shareholders 954 377 246 68 70 30 163 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------------------------------------- Net income $954 $377 $246 $68 $70 $30 $163 ==================================================================================================
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. 7 (METLIFE LOGO) METLIFE, INC. CONSOLIDATING STATEMENT OF OPERATING EARNINGS FOR THE SIX MONTHS ENDED JUNE 30, 2005
Corporate, Other Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $12,021 $5,676 $2,079 $1,466 $957 $1,839 $4 Universal life and investment-type product policy fees 1,605 367 991 0 245 2 0 Investment income, net 6,787 2,547 3,153 89 344 312 342 Other revenues 600 313 228 17 2 32 8 -------------------------------------------------------------------------------------------------- 21,013 8,903 6,451 1,572 1,548 2,185 354 -------------------------------------------------------------------------------------------------- EXPENSES Policyholder benefits and dividends 13,019 6,263 3,381 926 897 1,592 (40) Interest credited to policyholder account balances 1,615 598 816 0 102 99 0 Capitalization of deferred policy acquisition costs (1,625) (132) (533) (222) (263) (475) 0 Amortization of deferred policy acquisition costs 1,084 67 359 226 112 320 0 Other expenses 4,487 1,076 1,535 399 523 606 348 -------------------------------------------------------------------------------------------------- 18,580 7,872 5,558 1,329 1,371 2,142 308 -------------------------------------------------------------------------------------------------- Operating earnings before provision (benefit) for income taxes 2,433 1,031 893 243 177 43 46 Provision (benefit) for income taxes 743 349 297 66 60 13 (42) -------------------------------------------------------------------------------------------------- Operating earnings 1,690 682 596 177 117 30 88 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $1,690(2) $682 $596 $177 $117 $30 $88 ================================================================================================== NET INCOME RECONCILIATION Operating earnings available to common shareholders $1,690 $682 $596 $177 $117 $30 $88 Net investment gains (losses) 2,204 428 551 (4) 7 21 1,201 Minority interest - net investment gains (losses) (11) 0 (4) 0 0 (7) 0 Net investment gains (losses) tax benefit (provision) (775) (153) (194) 1 (2) (2) (425) -------------------------------------------------------------------------------------------------- Net investment gains (losses), net of income taxes 1,418 275 353 (3) 5 12 776 Adjustments related to policyholder benefits and dividends (16) (2) (12) 0 (2) 0 0 Adjustments related to other expenses (24) 0 (19) 0 0 (5) 0 Adjustments related to tax benefit (provision) 13 1 11 0 1 0 0 -------------------------------------------------------------------------------------------------- Adjustments related to net investment gains (losses), net of income taxes (1) (27) (1) (20) 0 (1) (5) 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 151 0 0 0 0 0 151 -------------------------------------------------------------------------------------------------- Net income available to common shareholders 3,232 956 929 174 121 37 1,015 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------------------------------------- Net income $3,232 $956 $929 $174 $121 $37 $1,015 ==================================================================================================
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. (2) Operating earnings available to common shareholders for the three months ended June 30, 2005 includes a $30 million benefit, net of income taxes, associated with the reduction of a previously established liability for settlement death benefits related to the Company's sales practices class action settlement recorded in 1999, an $18 million benefit, net of income taxes, associated with the reduction of a previously established liability related to the Company's demutualization in 2000, and an $8 million charge, net of income taxes, associated with establishment of a liability associated with the Argentine pension business. 8 (METLIFE LOGO) METLIFE, INC. CONSOLIDATING STATEMENT OF OPERATING EARNINGS FOR THE SIX MONTHS ENDED JUNE 30, 2004
Corporate, Other Unaudited (Dollars in millions) Consolidated Institutional Individual Auto & Home International Reinsurance & Eliminations - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $10,723 $4,855 $1,985 $1,471 $794 $1,623 ($5) Universal life and investment-type product policy fees 1,384 337 878 0 169 0 0 Investment income, net 6,157 2,224 3,070 90 260 266 247 Other revenues 596 319 223 15 12 27 0 -------------------------------------------------------------------------------------------------- 18,860 7,735 6,156 1,576 1,235 1,916 242 -------------------------------------------------------------------------------------------------- EXPENSES Policyholder benefits and dividends 11,845 5,425 3,297 1,031 778 1,310 4 Interest credited to policyholder account balances 1,481 459 850 0 69 103 0 Capitalization of deferred policy acquisition costs (1,616) (202) (591) (224) (164) (435) 0 Amortization of deferred policy acquisition costs 919 57 336 226 67 233 0 Other expenses 4,386 1,036 1,657 389 366 642 296 -------------------------------------------------------------------------------------------------- 17,015 6,775 5,549 1,422 1,116 1,853 300 -------------------------------------------------------------------------------------------------- Operating earnings before provision (benefit) for income taxes 1,845 960 607 154 119 63 (58) Provision (benefit) for income taxes 484 326 203 37 34 22 (138) -------------------------------------------------------------------------------------------------- Operating earnings 1,361 634 404 117 85 41 80 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $1,361 $634 $404 $117 $85 $41 $80 ================================================================================================== NET INCOME RECONCILIATION Operating earnings available to common shareholders $1,361 $634 $404 $117 $85 $41 $80 Net investment gains (losses) 280 118 3 (5) 24 53 87 Minority interest - net investment gains (losses) (16) 0 0 0 0 (16) 0 Net investment gains (losses) tax benefit (provision) (86) (45) 10 2 (7) (13) (33) -------------------------------------------------------------------------------------------------- Net investment gains (losses), net of income taxes 178 73 13 (3) 17 24 54 Adjustments related to policyholder benefits and dividends 147 61 34 0 52 0 0 Adjustments related to other expenses (22) 0 (5) 0 0 (17) 0 Adjustments related to tax benefit (provision) (44) (21) (11) 0 (18) 6 0 -------------------------------------------------------------------------------------------------- Adjustments related to net investment gains (losses), net of income taxes (1) 81 40 18 0 34 (11) 0 Cumulative effect of a change in accounting, net of income taxes (2) (86) (60) 0 0 (30) 5 (1) Discontinued operations, net of income taxes 18 0 0 0 0 0 18 -------------------------------------------------------------------------------------------------- Net income available to common shareholders 1,552 687 435 114 106 59 151 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------------------------------------- Net income $1,552 $687 $435 $114 $106 $59 $151 ==================================================================================================
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. (2) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. 9 (METLIFE LOGO) SUMMARY OF SEGMENT OPERATING EARNINGS (1)
For Three Months Ended ----------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ---------------------------------------------------------------------------------------------------------- INSTITUTIONAL OPERATIONS $317 $294 $308 $324 $358 INDIVIDUAL OPERATIONS 217 201 200 318 278 AUTO & HOME OPERATIONS 71 34 63 76 101 INTERNATIONAL OPERATIONS 41 45 26 67 50 REINSURANCE OPERATIONS 23 14 31 27 3 CORPORATE, OTHER & ELIMINATIONS 97 28 28 9 79 ----------------------------------------------------------------------- CONSOLIDATED $766(2) $616(3) $656 $821 $869(4) =======================================================================
(1) A reconciliation of operating earnings available to common shareholders to net income for each segment appears in this QFS as follows: (i) Institutional Operations, page 11; (ii) Individual Operations, page 19; (iii) Auto & Home Operations, page 29; (iv) International Operations, page 34; (v) Reinsurance Operations, page 35; and Corporate, Other and Eliminations, page 37. A reconciliation of operating earnings to net income for MetLife, Inc., Consolidated, appears on Page 4. (2) Operating earnings available to common shareholders and net income for the three months ended June 30, 2004 includes a $32 million charge, net of income taxes, from a contribution to the MetLife Foundation made by Metropolitan Life Insurance Company, a $31 million benefit, net of income taxes, from a reduction of a previously established premium tax liability, and a $105 million benefit related to a previously disclosed resolution of an IRS audit. (3) Operating earnings available to common shareholders for the three months ended September 30, 2004 includes a $9 million benefit, from a revision of the estimate of income taxes for 2003. (4) Operating earnings available to common shareholders for the three months ended June 30, 2005 includes a $30 million benefit, net of income taxes, associated with the reduction of a previously established liability for settlement death benefits related to the Company's sales practices class action settlement recorded in 1999, an $18 million benefit, net of income taxes, associated with the reduction of a previously established liability related to the Company's demutualization in 2000, and an $8 million charge, net of income taxes, associated with establishment of a liability associated with the Argentine pension business. 10 (METLIFE LOGO) INSTITUTIONAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - TOTAL UNAUDITED (DOLLARS IN MILLIONS)
For the Three Months Ended --------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Institutional Operations 2004 2004 2004 2005 2005 - ----------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $2,401 $2,662 $2,515 $2,843 $2,833 Universal life and investment-type product policy fees 182 177 171 187 180 Investment income, net 1,128 1,115 1,180 1,215 1,332 Other revenues 155 152 161 156 157 --------------------------------------------------------------- 3,866 4,106 4,027 4,401 4,502 --------------------------------------------------------------- EXPENSES Policyholder benefits and dividends 2,713 2,926 2,780 3,133 3,130 Interest credited to policyholder account balances 232 242 259 286 312 Other expenses 440 494 522 493 518 --------------------------------------------------------------- 3,385 3,662 3,561 3,912 3,960 --------------------------------------------------------------- Operating earnings before provision for income taxes 481 444 466 489 542 Provision for income taxes 164 150 158 165 184 --------------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $317 (3) $294 $308 $324 $358 =============================================================== NET INCOME RECONCILIATION - ----------------------------------------------------- Operating earnings available to common shareholders $317 $294 $308 $324 $358 Net investment gains (losses) $18 105 (69) 5 423 Minority interest - net investment gains (losses) 0 0 0 0 0 Net investment gains (losses) tax benefit (provision) (9) (33) 24 (3) (150) --------------------------------------------------------------- Net investment gains (losses), net of income taxes 9 72 (45) 2 273 Adjustments related to policyholder benefits and dividends 78 (35) (33) 35 (37) Adjustments related to other expenses 0 0 0 0 0 Adjustments related to tax benefit (provision) (27) 11 12 (12) 13 --------------------------------------------------------------- Adjustments related to net investment gains (losses), net of income taxes (1) 51 (24) (21) 23 (24) Cumulative effect of a change in accounting, net of income taxes (2) 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 --------------------------------------------------------------- Net income available to common shareholders 377 342 242 349 607 Preferred stock dividend 0 0 0 0 0 --------------------------------------------------------------- Net income $377 $342 $242 $349 $607 ---------------------------------------------------------------
For the Year-to-Date Period Ended --------------------------------------- June 30, June 30, Institutional Operations 2004 2005 - ----------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $4,855 $5,676 Universal life and investment-type product policy fees 337 367 Investment income, net 2,224 2,547 Other revenues 319 313 --------------------------------------- 7,735 8,903 --------------------------------------- EXPENSES Policyholder benefits and dividends 5,425 6,263 Interest credited to policyholder account balances 459 598 Other expenses 891 1,011 --------------------------------------- 6,775 7,872 --------------------------------------- Operating earnings before provision for income taxes 960 1,031 Provision for income taxes 326 349 --------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS 634 (3) 682 ======================================= NET INCOME RECONCILIATION - ----------------------------------------------------- Operating earnings available to common shareholders $634 $682 Net investment gains (losses) 118 428 Minority interest - net investment gains (losses) 0 0 Net investment gains (losses) tax benefit (provision) (45) (153) --------------------------------------- Net investment gains (losses), net of income taxes 73 275 Adjustments related to policyholder benefits and dividends 61 (2) Adjustments related to other expenses 0 0 Adjustments related to tax benefit (provision) (21) 1 --------------------------------------- Adjustments related to net investment gains (losses), net of income taxes (1) 40 (1) Cumulative effect of a change in accounting, net of income taxes (2) (60) 0 Discontinued operations, net of income taxes 0 0 --------------------------------------- Net income available to common shareholders 687 956 Preferred stock dividend 0 0 --------------------------------------- Net income $687 $956 ---------------------------------------
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs and amounts allocable to certain participating contracts. (2) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. (3) Operating earnings available to common shareholders for the period ended June 30, 2004 includes a $31 million benefit, net of income taxes, from a reduction of a previously established premium tax liability. 11 (METLIFE LOGO) INSTITUTIONAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Three Months Ended -------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Group Life 2004 2004 2004 2005 2005 - ---------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $1,261 $1,225 $1,242 $1,318 $1,385 Universal life and investment-type product policy fees 182 177 171 187 180 Investment income, net 269 250 252 268 278 Other revenues 13 10 14 13 13 -------------------------------------------------------------- 1,725 1,662 1,679 1,786 1,856 -------------------------------------------------------------- EXPENSES Policyholder benefits and dividends 1,338 1,284 1,296 1,408 1,486 Interest credited to policyholder account balances 101 100 101 99 105 Other expenses 88 126 136 129 142 -------------------------------------------------------------- 1,527 1,510 1,533 1,636 1,733 -------------------------------------------------------------- Operating earnings before provision for income taxes 198 152 146 150 123 Provision for income taxes 68 52 50 50 43 -------------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $130 $100 $96 $100 $80 ============================================================== Net investment gains (losses), net of income taxes (4) 4 (44) (10) 0 Adjustments related to net investment gains (losses), net of income taxes 0 0 0 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 -------------------------------------------------------------- Net income available to common shareholders 126 104 52 90 80 Preferred stock dividend 0 0 0 0 0 -------------------------------------------------------------- Net income $126 $104 $52 $90 $80 --------------------------------------------------------------
For the Year-to-Date Period Ended ------------------------------------------ June 30, June 30, Group Life 2004 2005 - -------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $2,577 2,703 Universal life and investment-type product policy fees 337 367 Investment income, net 528 546 Other revenues 32 26 ------------------------------------------ 3,474 3,642 ------------------------------------------ EXPENSES Policyholder benefits and dividends 2,748 2,894 Interest credited to policyholder account balances 201 204 Other expenses 211 271 ------------------------------------------ 3,160 3,369 ------------------------------------------ Operating earnings before provision for income taxes 314 273 Provision for income taxes 107 93 ------------------------------------------ OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $207 $180 ========================================== Net investment gains (losses), net of income taxes 13 (10) Adjustments related to net investment gains (losses), net of income taxes 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 Discontinued operations, net of income taxes 0 0 ------------------------------------------ Net income available to common shareholders 220 170 Preferred stock dividend 0 0 ------------------------------------------ Net income $220 $170 ------------------------------------------
12 (METLIFE LOGO) INSTITUTIONAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Three Months Ended ------------------------------------------------------------ June 30, September 30, December 31, March 31, June 30, Retirement & Savings 2004 2004 2004 2005 2005 - -------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $225 $504 $298 $495 $383 Universal life and investment-type product policy fees 0 0 0 0 0 Investment income, net 736 750 803 817 898 Other revenues 55 54 55 57 56 ------------------------------------------------------------ 1,016 1,308 1,156 1,369 1,337 ------------------------------------------------------------ EXPENSES Policyholder benefits and dividends 598 868 675 862 750 Interest credited to policyholder account balances 131 142 158 187 207 Other expenses 84 83 88 78 73 ------------------------------------------------------------ 813 1,093 921 1,127 1,030 ------------------------------------------------------------ Operating earnings before provision for income taxes 203 215 235 242 307 Provision for income taxes 68 71 78 81 103 ------------------------------------------------------------ OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $135 $144 $157 $161 $204 ============================================================ Net investment gains (losses), net of income taxes 28 49 4 13 237 Adjustments related to net investment gains (losses), net of income taxes 20 (3) (15) 11 (10) Cumulative effect of a change in accounting, net of income taxes (1) 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 ------------------------------------------------------------ Net income available to common shareholders 183 190 146 185 431 Preferred stock dividend 0 0 0 0 0 ------------------------------------------------------------ Net income $183 $190 $146 $185 $431 ------------------------------------------------------------
For the Year-to-Date Period Ended ------------------------------------------ June 30, June 30, Retirement & Savings 2004 2005 - ---------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $490 $878 Universal life and investment-type product policy fees 0 0 Investment income, net 1,466 1,715 Other revenues 112 113 ------------------------------------------ 2,068 2,706 ------------------------------------------ EXPENSES Policyholder benefits and dividends 1,187 1,612 Interest credited to policyholder account balances 258 394 Other expenses 153 151 ------------------------------------------ 1,598 2,157 ------------------------------------------ Operating earnings before provision for income taxes 470 549 Provision for income taxes 157 184 ------------------------------------------ OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $313 $365 ========================================== Net investment gains (losses), net of income taxes 60 250 Adjustments related to net investment gains (losses), net of income taxes 20 1 Cumulative effect of a change in accounting, net of income taxes (1) (40) 0 Discontinued operations, net of income taxes 0 0 ------------------------------------------ Net income available to common shareholders 353 616 Preferred stock dividend 0 0 ------------------------------------------ Net income $353 $616 ------------------------------------------
(1) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. 13 (METLIFE LOGO) INSTITUTIONAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Three Months Ended --------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Non-Medical Health & Other 2004 2004 2004 2005 2005 - ---------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $915 $933 $975 $1,030 $1,065 Universal life and investment-type product policy fees 0 0 0 0 0 Investment income, net 123 115 125 130 156 Other revenues 87 88 92 86 88 -------------------------------------------------------------- 1,125 1,136 1,192 1,246 1,309 -------------------------------------------------------------- EXPENSES Policyholder benefits and dividends 777 774 809 863 894 Interest credited to policyholder account balances 0 0 0 0 0 Other expenses 268 285 298 286 303 -------------------------------------------------------------- 1,045 1,059 1,107 1,149 1,197 -------------------------------------------------------------- Operating earnings before provision for income taxes 80 77 85 97 112 Provision for income taxes 28 27 30 34 38 -------------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $52 $50 $55 $63 $74 ============================================================== Net investment gains (losses), net of income taxes (15) 19 (5) (1) 36 Adjustments related to net investment gains (losses), net of income taxes 31 (21) (6) 12 (14) Cumulative effect of a change in accounting, net of income taxes (1) 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 -------------------------------------------------------------- Net income available to common shareholders 68 48 44 74 96 Preferred stock dividend 0 0 0 0 0 -------------------------------------------------------------- Net income $68 $48 $44 $74 $96 --------------------------------------------------------------
For the Year-to-Date Period Ended -------------------------------------------- June 30, June 30, Non-Medical Health & Other 2004 2005 - ----------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums $1,788 $2,095 Universal life and investment-type product policy fees 0 0 Investment income, net 230 286 Other revenues 175 174 -------------------------------------------- 2,193 2,555 -------------------------------------------- EXPENSES Policyholder benefits and dividends 1,490 1,757 Interest credited to policyholder account balances 0 0 Other expenses 527 589 -------------------------------------------- 2,017 2,346 -------------------------------------------- Operating earnings before provision for income taxes 176 209 Provision for income taxes 62 72 -------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $114 $137 ============================================ Net investment gains (losses), net of income taxes 0 35 Adjustments related to net investment gains (losses), net of income taxes 20 (2) Cumulative effect of a change in accounting, net of income taxes (1) (20) 0 Discontinued operations, net of income taxes 0 0 -------------------------------------------- Net income available to common shareholders 114 170 Preferred stock dividend 0 0 -------------------------------------------- Net income $114 $170 --------------------------------------------
(1) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. 14 (METLIFE LOGO) INSTITUTIONAL OPERATIONS PREMIUMS, FEES AND OTHER REVENUES BY PRODUCT AND ADDITIONAL STATISTICAL INFORMATION
For the Three Months Ended ------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ PREMIUMS, FEES AND OTHER REVENUES BY PRODUCT (1) Group Life $1,456 $1,412 $1,427 $1,518 $1,578 Retirement & Savings 280 558 353 552 439 Non-Medical Health & Other 1,002 1,021 1,067 1,116 1,153 ------------------------------------------------------------------- Total Premiums, Fees and Other Revenues $2,738 $2,991 $2,847 $3,186 $3,170 =================================================================== Group Disability (Included in Non-Medical Health & Other) $252 $253 $276 $282 $291 ADDITIONAL STATISTICAL INFORMATION INCURRED LOSS RATIO (MORTALITY EXPERIENCE): Term Life 93.2% 90.9% 90.7% 94.9% 96.2% INCURRED LOSS RATIO (MORBIDITY EXPERIENCE): Group Disability 92.8% 91.9% 98.8% 91.1% 88.0% NUMBER OF SALES REPRESENTATIVES 794 779 762 783 778
(1) With respect to premiums, fees and other revenues, certain experience rating refunds and changes to premium stabilization reserves are included in premiums and fees. The following table excludes these amounts: ------------------------------------------------------------------- Group Life $1,444 $1,459 $1,513 $1,602 $1,582 Retirement & Savings 280 558 353 552 439 Non-Medical Health & Other 1,000 1,024 1,061 1,123 1,152 ------------------------------------------------------------------- Total Premiums, Fees and Other Revenues $2,724 $3,041 $2,927 $3,277 $3,173 ===================================================================
15 (METLIFE LOGO) INSTITUTIONAL OPERATIONS FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES AND SEPARATE ACCOUNT LIABILITIES UNAUDITED (DOLLARS IN MILLIONS) FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES
For the Three Months Ended --------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Group Life 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ Balance, beginning of period $14,642 $14,834 $14,959 $15,022 $15,174 Premiums and deposits 2,638 2,497 2,446 2,697 2,869 Interest on reserves 131 131 135 135 142 Surrenders and withdrawals (1,118) (1,081) (1,115) (1,159) (1,324) Benefits and reserves (1,338) (1,287) (1,288) (1,409) (1,487) Other (121) (135) (115) (112) (102) --------------------------------------------------------------------------------------------- Balance, end of period $14,834 $14,959 $15,022 $15,174 $15,272 =============================================================================================
For the Three Months Ended --------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Retirement & Savings 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ Balance, beginning of period $42,634 $42,287 $44,497 $45,979 $47,472 Premiums and deposits 2,003 2,525 2,696 2,699 2,095 Interest on reserves 551 567 595 613 634 Surrenders and withdrawals (928) (1,361) (1,566) (807) (1,743) Benefits and reserves (470) (504) (495) (484) (494) Other (1) (1,503) 983 252 (528) 1,310 --------------------------------------------------------------------------------------------- Balance, end of period $42,287 $44,497 $45,979 $47,472 $49,274 =============================================================================================
For the Three Months Ended --------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Non-Medical Health & Other 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ Balance, beginning of period $6,003 $6,407 $6,601 $6,784 $6,931 Premiums and deposits 835 843 899 942 981 Interest on reserves 60 63 64 67 68 Surrenders and withdrawals 25 27 18 19 23 Benefits and reserves (739) (753) (791) (839) (868) Other (1) 223 14 (7) (42) 25 --------------------------------------------------------------------------------------------- Balance, end of period $6,407 $6,601 $6,784 $6,931 $7,160 =============================================================================================
SEPARATE ACCOUNT LIABILITIES
For the Three Months Ended --------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Group Life 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ Balance, beginning of period $7,754 $8,066 $8,337 $8,192 $7,976 Premiums and deposits 156 182 133 114 120 Investment performance 239 166 63 168 40 Surrenders and withdrawals (86) (77) (341) (498) (86) Policy charges 0 0 0 0 0 Other 3 0 0 0 0 --------------------------------------------------------------------------------------------- Balance, end of period $8,066 $8,337 $8,192 $7,976 $8,050 =============================================================================================
For the Three Months Ended --------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Retirement & Savings 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ Balance, beginning of period $27,376 $26,962 $27,666 $28,507 $27,302 Premiums and deposits 694 834 758 1,426 828 Investment performance (277) 732 971 (1,105) 1,851 Surrenders and withdrawals (842) (818) (883) (1,511) (1,051) Policy charges (20) (19) (19) (20) (21) Other (1) 31 (25) 14 5 (27) --------------------------------------------------------------------------------------------- Balance, end of period $26,962 $27,666 $28,507 $27,302 $28,882 =============================================================================================
For the Three Months Ended --------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Non-Medical Health & Other 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ Balance, beginning of period $139 $160 $200 $214 $243 Premiums and deposits 82 89 76 88 85 Investment performance 14 62 (45) (108) 191 Surrenders and withdrawals (25) (27) (18) (19) (23) Policy charges (9) (9) (28) (17) (18) Other (1) (41) (75) 29 85 (202) --------------------------------------------------------------------------------------------- Balance, end of period $160 $200 $214 $243 $276 =============================================================================================
16 (METLIFE LOGO) INSTITUTIONAL OPERATIONS OTHER EXPENSES BY MAJOR CATEGORY
For the Three Months Ended ---------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - -------------------------------------------------------------------------------------------------------------------------------- OTHER EXPENSES BY MAJOR CATEGORY Direct and allocated expenses $361 $355 $394 $358 $372 Pension and other post-retirement benefit costs 21 17 17 19 19 Premium taxes and other taxes, licenses and fees (11) 38 33 31 41 ---------------------------------------------------------------------------- Sub-total Insurance Expenses 371 410 444 408 432 Commissions and other expenses 69 84 78 85 86 ---------------------------------------------------------------------------- Total Other Expenses $440 $494 $522 $493 $518 ============================================================================
17 (METLIFE LOGO) INSTITUTIONAL OPERATIONS SPREADS BY PRODUCT UNAUDITED
For the Three Months Ended --------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Group Life 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------- ANNUALIZED GENERAL ACCOUNT SPREADS BY SEGMENT (%) Investment income yield 5.87% 5.32% 5.34% 5.58% 5.75% Average crediting rate 3.44% 3.45% 3.58% 3.59% 3.75% --------------------------------------------------------------------------------- Spread 2.43% 1.87% 1.76% 1.99% 2.00% =================================================================================
For the Three Months Ended --------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Retirement & Savings 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------- ANNUALIZED GENERAL ACCOUNT SPREADS BY SEGMENT (%) Investment income yield 6.93% 6.85% 7.17% 6.91% 7.43% Average crediting rate 5.33% 5.29% 5.34% 5.44% 5.48% --------------------------------------------------------------------------------- Spread 1.60% 1.56% 1.83% 1.47% 1.95% =================================================================================
For the Three Months Ended --------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Non-Medical Health & Other 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------- ANNUALIZED GENERAL ACCOUNT SPREADS BY SEGMENT (%) Investment income yield 7.77% 6.86% 7.53% 7.34% 9.05% Average crediting rate 5.33% 5.43% 5.47% 5.45% 5.44% --------------------------------------------------------------------------------- Spread 2.44% 1.43% 2.06% 1.89% 3.61% =================================================================================
18 (METLIFE LOGO) INDIVIDUAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - TOTAL UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date For the Three Months Ended Period Ended ------------------------------------------------------------ ----------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Individual Operations 2004 2004 2004 2005 2005 2004 2005 - ---------------------------------------------------------------------------------------------------------- ----------------------- REVENUES Premiums $1,007 $1,023 $1,164 $1,021 $1,058 $1,985 $2,079 Universal life and investment-type product policy fees 453 467 486 485 506 878 991 Investment income, net 1,549 1,528 1,552 1,561 1,592 3,070 3,153 Other revenues 106 109 112 117 111 223 228 ------------------------------------------------------------ ----------------------- 3,115 3,127 3,314 3,184 3,267 6,156 6,451 ------------------------------------------------------------ ----------------------- EXPENSES Policyholder benefits and dividends 1,653 1,681 1,801 1,635 1,746 3,297 3,381 Interest credited to policyholder account balances 427 412 412 407 409 850 816 Capitalization of deferred policy acquisition costs (298) (268) (284) (254) (279) (591) (533) Amortization of deferred policy acquisition costs 170 210 228 186 173 336 359 Other expenses 837 789 857 733 802 1,657 1,535 ------------------------------------------------------------ ----------------------- 2,789 2,824 3,014 2,707 2,851 5,549 5,558 ------------------------------------------------------------ ----------------------- Operating earnings before provision for income taxes 326 303 300 477 416 607 893 Provision for income taxes 109 102 100 159 138 203 297 ------------------------------------------------------------ ----------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $217 $201 $200 $318 $278 $404 $596 ============================================================ ======================= NET INCOME RECONCILIATION Operating earnings $217 $201 $200 $318 $278 $404 $596 Net investment gains (losses) 31 105 (50) 59 492 3 551 Minority interest - net investment gains (losses) 0 0 4 (4) 0 0 (4) Net investment gains (losses) tax benefit (provision) 1 (37) 11 (23) (171) 10 (194) ------------------------------------------------------------ ----------------------- Net investment gains (losses), net of income taxes 32 68 (35) 32 321 13 353 Adjustments related to policyholder benefits and dividends (11) (25) 30 21 (33) 34 (12) Adjustments related to other expenses 8 (8) 4 2 (21) (5) (19) Adjustments related to tax benefit (provision) 0 12 (12) (8) 19 (11) 11 ------------------------------------------------------------ ----------------------- Adjustments related to net investment gains (losses), net of income taxes (1) (3) (21) 22 15 (35) 18 (20) Cumulative effect of a change in accounting, net of income taxes (2) 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 ------------------------------------------------------------ ----------------------- Net income available to common shareholders 246 248 187 365 564 435 929 Preferred stock dividend 0 0 0 0 0 0 0 ------------------------------------------------------------ ----------------------- Net income $246 $248 $187 $365 $564 $435 $929 ============================================================ =======================
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs, adjustments to the policyholder dividend obligation and amounts allocable to certain participating contracts. (2) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. 19 (METLIFE LOGO) INDIVIDUAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date For the Three Months Ended Period Ended ------------------------------------------------------------ ----------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Traditional Life 2004 2004 2004 2005 2005 2004 2005 - ---------------------------------------------------------------------------------------------------------- ----------------------- REVENUES Premiums $980 $989 $1,113 $957 $984 $1,939 $1,941 Universal life and investment-type product policy fees 0 0 0 0 0 0 0 Investment income, net 848 831 825 832 821 1,691 1,653 Other revenues 0 1 4 2 0 1 2 ------------------------------------------------------------ ----------------------- 1,828 1,821 1,942 1,791 1,805 3,631 3,596 ------------------------------------------------------------ ----------------------- EXPENSES Policyholder benefits and dividends 1,496 1,517 1,629 1,433 1,507 2,976 2,940 Interest credited to policyholder account balances 0 0 0 0 0 0 0 Capitalization of deferred policy acquisition costs (42) (44) (50) (43) (60) (83) (103) Amortization of deferred policy acquisition costs 51 51 74 53 48 107 101 Other expenses 206 213 240 184 208 417 392 ------------------------------------------------------------ ----------------------- 1,711 1,737 1,893 1,627 1,703 3,417 3,330 ------------------------------------------------------------ ----------------------- Operating earnings before provision for income taxes 117 84 49 164 102 214 266 Provision for income taxes 40 29 17 55 35 73 90 ------------------------------------------------------------ ----------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $77 $55 $32 $109 $67 $141 $176 ============================================================ ======================= Net investment gains (losses), net of income taxes 20 60 15 45 223 5 268 Adjustments related to net investment gains (losses), net of income taxes (4) (18) 18 15 (22) 18 (7) Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 ------------------------------------------------------------ ----------------------- Net income available to common shareholders 93 97 65 169 268 164 437 Preferred stock dividend 0 0 0 0 0 0 0 ------------------------------------------------------------ ----------------------- Net income $93 $97 $65 $169 $268 $164 $437 ============================================================ =======================
20 (METLIFE LOGO) INDIVIDUAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Three Months Ended ------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Variable & Universal Life 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $ 0 $ 0 $ 0 $ 0 $ 0 Universal life and investment-type product policy fees 264 279 272 265 277 Investment income, net 143 147 149 152 151 Other revenues (3) 1 (1) 0 (3) ------------------------------------------------------- 404 427 420 417 425 ------------------------------------------------------- EXPENSES Policyholder benefits and dividends 88 76 56 93 97 Interest credited to policyholder account balances 116 117 114 114 117 Capitalization of deferred policy acquisition costs (86) (74) (79) (65) (72) Amortization of deferred policy acquisition costs 52 73 82 49 64 Other expenses 186 176 186 148 160 ------------------------------------------------------- 356 368 359 339 366 ------------------------------------------------------- Operating earnings before provision for income taxes 48 59 61 78 59 Provision for income taxes 16 20 21 27 20 ------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $ 32 $ 39 $ 40 $ 51 $ 39 ======================================================= Net investment gains (losses), net of income taxes (5) 5 (1) (8) 9 Adjustments related to net investment gains (losses), net of income taxes 2 (2) 0 (2) (2) Cumulative effect of a change in accounting, net of income taxes (1) 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 ------------------------------------------------------- Net income available to common shareholders 29 42 39 41 46 Preferred stock dividend 0 0 0 0 0 ------------------------------------------------------- Net income $ 29 $ 42 $ 39 $ 41 $ 46 -------------------------------------------------------
For the Year-to-Date Period Ended ------------------------------------ June 30, June 30, 2004 2005 ------------------------------------ REVENUES Premiums $ 0 $ 0 Universal life and investment-type product policy fees 509 542 Investment income, net 283 303 Other revenues 1 (3) ------------------------------------ 793 842 ------------------------------------ EXPENSES Policyholder benefits and dividends 175 190 Interest credited to policyholder account balances 229 231 Capitalization of deferred policy acquisition costs (156) (137) Amortization of deferred policy acquisition costs 100 113 Other expenses 361 308 ------------------------------------ 709 705 ------------------------------------ Operating earnings before provision for income taxes 84 137 Provision for income taxes 28 47 ------------------------------------ OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $ 56 $ 90 ==================================== Net investment gains (losses), net of income taxes (2) 1 Adjustments related to net investment gains (losses), net of income taxes 1 (4) Cumulative effect of a change in accounting, net of income taxes (1) (11) 0 Discontinued operations, net of income taxes 0 0 ------------------------------------ Net income available to common shareholders 44 87 Preferred stock dividend 0 0 ------------------------------------ Net income $ 44 $ 87 ------------------------------------
(1) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. 21 (METLIFE LOGO) INDIVIDUAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Three Months Ended -------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Annuities 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $26 $34 $48 $63 $73 Universal life and investment-type product policy fees 156 156 177 185 198 Investment income, net 494 491 513 511 551 Other revenues 10 11 11 11 13 -------------------------------------------------------- 686 692 749 770 835 -------------------------------------------------------- EXPENSES Policyholder benefits and dividends 58 78 111 96 113 Interest credited to policyholder account balances 281 266 267 261 260 Capitalization of deferred policy acquisition costs (169) (149) (154) (145) (147) Amortization of deferred policy acquisition costs 64 84 62 81 57 Other expenses 302 268 281 259 292 -------------------------------------------------------- 536 547 567 552 575 -------------------------------------------------------- Operating earnings before provision for income taxes 150 145 182 218 260 Provision for income taxes 49 47 59 71 85 -------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $101 $98 $123 $147 $175 ======================================================== Net investment gains (losses), net of income taxes 17 9 (58) 1 94 Adjustments related to net investment gains (losses), net of income taxes (1) (1) 4 2 (11) Cumulative effect of a change in accounting, net of income taxes (1) 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 -------------------------------------------------------- Net income available to common shareholders 117 106 69 150 258 Preferred stock dividend 0 0 0 0 0 -------------------------------------------------------- Net income $117 $106 $69 $150 $258 --------------------------------------------------------
For the Year-to-Date Period Ended --------------------------------------- June 30, June 30, 2004 2005 --------------------------------------- REVENUES Premiums $44 $136 Universal life and investment-type product policy fees 307 383 Investment income, net 969 1,062 Other revenues 17 24 --------------------------------------- 1,337 1,605 --------------------------------------- EXPENSES Policyholder benefits and dividends 126 209 Interest credited to policyholder account balances 561 521 Capitalization of deferred policy acquisition costs (350) (292) Amortization of deferred policy acquisition costs 123 138 Other expenses 601 551 --------------------------------------- 1,061 1,127 --------------------------------------- Operating earnings before provision for income taxes 276 478 Provision for income taxes 90 156 --------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $186 $322 ======================================= Net investment gains (losses), net of income taxes 19 95 Adjustments related to net investment gains (losses), net of income taxes (1) (9) Cumulative effect of a change in accounting, net of income taxes (1) 11 0 Discontinued operations, net of income taxes 0 0 --------------------------------------- Net income available to common shareholders 215 408 Preferred stock dividend 0 0 --------------------------------------- Net income $215 $408 ---------------------------------------
(1) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. 22 (METLIFE LOGO) INDIVIDUAL OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Three Months Ended ------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Other 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ REVENUES Premiums $1 $0 $3 $1 $1 Universal life and investment-type product policy fees 33 32 37 35 31 Investment income, net 64 59 65 66 69 Other revenues 99 96 98 104 101 ------------------------------------------------------- 197 187 203 206 202 ------------------------------------------------------- EXPENSES Policyholder benefits and dividends 11 10 5 13 29 Interest credited to policyholder account balances 30 29 31 32 32 Capitalization of deferred policy acquisition costs (1) (1) (1) (1) 0 Amortization of deferred policy acquisition costs 3 2 10 3 4 Other expenses 143 132 150 142 142 ------------------------------------------------------- 186 172 195 189 207 ------------------------------------------------------- Operating earnings before provision for income taxes 11 15 8 17 (5) Provision for income taxes 4 6 3 6 (2) ------------------------------------------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $7 $9 $5 $11 ($3) ======================================================= Net investment gains (losses), net of income taxes 0 (6) 9 (6) (5) Adjustments related to net investment gains (losses), net of income taxes 0 0 0 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 ------------------------------------------------------- Net income available to common shareholders 7 3 14 5 (8) Preferred stock dividend 0 0 0 0 0 ------------------------------------------------------- Net income $7 $3 $14 $5 ($8) -------------------------------------------------------
For the Year-to-Date Period Ended ------------------------------------ June 30, June 30, 2004 2005 ------------------------------------ REVENUES Premiums $2 $2 Universal life and investment-type product policy fees 62 66 Investment income, net 127 135 Other revenues 204 205 ------------------------------------ 395 408 ------------------------------------ EXPENSES Policyholder benefits and dividends 20 42 Interest credited to policyholder account balances 60 64 Capitalization of deferred policy acquisition costs (2) (1) Amortization of deferred policy acquisition costs 6 7 Other expenses 278 284 ------------------------------------ 362 396 ------------------------------------ Operating earnings before provision for income taxes 33 12 Provision for income taxes 12 4 ------------------------------------ OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $21 $8 ==================================== Net investment gains (losses), net of income taxes (9) (11) Adjustments related to net investment gains (losses), net of income taxes 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 Discontinued operations, net of income taxes 0 0 ------------------------------------ Net income available to common shareholders 12 (3) Preferred stock dividend 0 0 ------------------------------------ Net income $12 ($3) ------------------------------------
23 (METLIFE LOGO) ================================================================================ INDIVIDUAL OPERATIONS PREMIUMS AND DEPOSITS BY PRODUCT AND MUTUAL FUND SALES
---------------------------------------------------------------------- For the Three Months Ended ---------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ PREMIUMS AND DEPOSITS BY PRODUCT (1) TOTAL (2) Life First Year Premiums & Deposits Traditional Life $47 $44 $51 $47 $52 Variable Life 1st Year excluding Single Premium COLI/BOLI 61 51 51 57 41 Universal Life 1st Year excluding Single Premium COLI/BOLI 116 125 118 102 110 Single Premium COLI/BOLI 49 20 4 1 10 ---------------------------------------------------------------------- Total Life First Year Premiums & Deposits (3) 273 240 224 207 213 Life Renewal Premiums & Deposits Traditional Life 1,030 1,017 1,163 943 1,020 Variable & Universal Life 418 447 452 472 416 Annuities (4) 2,882 2,410 2,566 2,540 2,496 Other 251 245 252 273 224 ---------------------------------------------------------------------- Total Premiums and Deposits $4,854 $4,359 $4,657 $4,435 $4,369 ====================================================================== PREMIUMS AND DEPOSITS TO SEPARATE ACCOUNTS Variable & Universal Life $287 $300 $294 $279 $246 Annuities 1,523 1,352 1,525 1,532 1,503 Other 157 152 157 161 137 ---------------------------------------------------------------------- Total Separate Accounts $1,967 $1,804 $1,976 $1,972 $1,886 ====================================================================== ANNUITY DEPOSITS BY TYPE Fixed Annuity Deposits $659 $403 $497 $429 $356 Variable Annuity Deposits 2,223 2,007 2,069 2,111 2,140 ---------------------------------------------------------------------- Total Annuity Deposits $2,882 $2,410 $2,566 $2,540 $2,496 ====================================================================== ---------------------------------------------------------------------- MUTUAL FUND SALES $864 $689 $935 $954 $916 ----------------------------------------------------------------------
(1) Statutory premiums direct and assumed. (2) Includes premiums and deposits to separate accounts and excludes company sponsored internal changes. (3) Of the $213 million of First Year Life Premiums and Deposits received during the three months ended June 30, 2005, approximately 60% were distributed through MetLife agents, 19% through New England Financial agents, 17% through MetLife's Independent Distribution channel and 4% through other distribution channels. (4) Of the $2,496 million of Annuity Deposits received during the three months ended June 30, 2005, approximately 32% were distributed through MetLife agents, 9% through New England Financial agents, 50% through MetLife's Independent Distribution channel and 9% through MetLife's Resources representatives. 24 (METLIFE LOGO) ================================================================================ INDIVIDUAL OPERATIONS ADDITIONAL STATISTICAL INFORMATION
------------------------------------------------------------------------- At or for the Three Months Ended ------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Unaudited 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ PERCENTAGE OF PREMIUMS AND DEPOSITS TO SEPARATE ACCOUNTS, EXCLUDING TRANSFERS FROM GENERAL ACCOUNT: Variable & Universal Life 44.1% 46.4% 43.0% 43.0% 41.4% Annuities 52.9% 56.1% 58.3% 60.3% 60.2% Other 62.5% 62.2% 62.3% 58.9% 60.9% MORTALITY AS A PERCENTAGE OF EXPECTED 78.1% 78.8% 85.6% 85.6% 84.7% LAPSES / SURRENDERS (GENERAL AND SEPARATE ACCOUNT) (1) Traditional Life 6.2% 6.2% 6.1% 6.2% 6.1% Variable & Universal Life 7.1% 7.0% 7.0% 6.6% 6.3% Variable Annuities 7.7% 7.5% 7.6% 7.6% 7.7% Fixed Annuities 8.0% 7.6% 6.7% 6.3% 5.8% NUMBER OF SALES REPRESENTATIVES MetLife Distribution 5,633 5,700 5,597 5,718 5,773 New England Financial 2,553 2,504 2,383 2,231 2,255 General American (2) 448 430 380 343 345 Independent Distribution Wholesalers 101 102 100 116 124 MetLife Resources 397 399 427 422 428 Walnut Street Securities (3) 1,413 1,370 1,359 1,294 1,263 P&C Specialists 500 529 544 570 617 ------------------------------------------------------------------------- Total Agents 11,045 11,034 10,790 10,694 10,805 -------------------------------------------------------------------------
(1) Lapses/Surrenders rates are calculated for the most recent 12 months of experience. (2) Based on minimum annual production of $25,000 in life insurance sales. (3) At June 30, 2005, the number of Walnut Street Securities representatives includes 100 brokers who are also reported as General American agents above. 25 METLIFE INDIVIDUAL OPERATIONS FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES AND SEPARATE ACCOUNT LIABILITIES UNAUDITED (DOLLARS IN MILLIONS) FUTURE POLICY BENEFITS AND POLICYHOLDER ACCOUNT BALANCES
------------------------------------------------------------------------------------------- For the Three Months Ended ------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Traditional Life 2004 2004 2004 2005 2005 --------------------------------------------------------------------------------------------------------------------------------- Balance, beginning of period $48,613 $48,828 $48,893 $49,209 $49,371 Premiums and deposits (1) 1,067 1,069 1,199 1,032 1,066 Interest on reserves 491 493 494 499 503 Surrenders and withdrawals (462) (466) (472) (447) (437) Benefit payments (437) (464) (458) (484) (492) Other (444) (567) (447) (438) (429) ------------------------------------------------------------------------------------------- Balance, end of period $48,828 $48,893 $49,209 $49,371 $49,582 -------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------- For the Three Months Ended ------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Variable & Universal Life 2004 2004 2004 2005 2005 --------------------------------------------------------------------------------------------------------------------------------- Balance, beginning of period $9,644 $9,797 $9,887 $9,991 $10,087 Premiums and deposits (1) (2) 370 340 342 353 320 Interest on reserves 115 114 115 112 117 Surrenders and withdrawals (158) (153) (168) (161) (160) Net transfers from (to) separate account 56 44 54 44 55 Policy charges (204) (224) (228) (225) (231) Benefit payments (27) (25) (24) (27) (30) Other 1 (6) 13 0 (4) ------------------------------------------------------------------------------------- Balance, end of period $9,797 $9,887 $9,991 $10,087 $10,154 -------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------- For the Three Months Ended ------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Annuities 2004 2004 2004 2005 2005 --------------------------------------------------------------------------------------------------------------------------------- Balance, beginning of period $31,491 $31,908 $31,955 $32,184 $32,304 Premiums and deposits (1) (2) 1,432 1,120 1,182 1,089 1,101 Interest on reserves 390 297 339 312 309 Surrenders and withdrawals (740) (517) (677) (587) (679) Net transfers from (to) separate account (566) (339) (425) (427) (346) Policy charges (4) (8) (1) (1) (3) Benefit payments (99) (235) (191) (277) (273) Other 4 (271) 2 11 8 --------------------------------------------------------------------------------------- Balance, end of period $31,908 $31,955 $32,184 $32,304 $32,421 ---------------------------------------------------------------------------------------
SEPARATE ACCOUNT LIABILITIES
-------------------------------------------------------------------------------------------- For the Three Months Ended -------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Variable & Universal Life 2004 2004 2004 2005 2005 ---------------------------------------------------------------------------------------------------------------------------------- Balance, beginning of period $6,989 $7,130 $7,258 $7,785 $7,747 Premiums and deposits (1) 287 299 294 279 247 Investment performance 85 (123) 583 (94) 135 Surrenders and withdrawals (104) (98) (224) (109) (109) Net transfers from (to) fixed account (56) (44) (54) (44) (55) Policy charges (71) (69) (72) (70) (65) Other 0 163 0 0 0 -------------------------------------------------------------------------------------- Balance, end of period $7,130 $7,258 $7,785 $7,747 $7,900 --------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------- For the Three Months Ended ------------------------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Annuities 2004 2004 2004 2005 2005 ---------------------------------------------------------------------------------------------------------------------------------- Balance, beginning of period $31,505 $32,989 $33,491 $37,597 $38,051 Premiums and deposits (1) 1,524 1,353 1,524 1,532 1,503 Investment performance 144 (413) 3,039 (604) 806 Surrenders and withdrawals (642) (668) (744) (764) (796) Net transfers from (to) fixed account 566 339 425 427 346 Policy charges (112) (109) (138) (137) (139) Other 4 0 0 0 0 ---------------------------------------------------------------------------------------- Balance, end of period $32,989 $33,491 $37,597 $38,051 $39,771 ----------------------------------------------------------------------------------------
(1) Includes Company-sponsored internal exchanges. (2) Includes premiums and deposits directed to the General Account investment option of a variable life or variable annuity product. 26 METLIFE INDIVIDUAL OPERATIONS INSURANCE EXPENSES AND OTHER EXPENSES BY MAJOR CATEGORY
------------------------------------------------------------------------- For the Three Months Ended ------------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ INSURANCE EXPENSES (NET OF CAPITALIZATION OF DAC) Insurance Expenses $752 $705 $753 $630 $698 DAC Capitalization (1) (333) (300) (308) (273) (293) ------------------------------------------------------------------------- Net $419 $405 $445 $357 $405 ========================================================================= OTHER EXPENSES BY MAJOR CATEGORY Commissions $241 $218 $218 $203 $213 Other deferrable expenses 114 103 114 93 103 Direct and allocated expenses, not deferred 335 327 370 276 344 Pension and other post-retirement benefit costs 32 28 27 29 29 Premium taxes and other taxes, licenses and fees 30 29 24 29 9 ------------------------------------------------------------------------- Subtotal Insurance Expenses $752 $705 $753 $630 $698 Broker-dealer and other expenses 134 126 141 132 131 Reinsurance allowances (49) (42) (37) (29) (27) ------------------------------------------------------------------------- Total Other Expenses $837 $789 $857 $733 $802 -------------------------------------------------------------------------
(1) Excludes $35 million, $32 million, $24 million, $19 million and $14 million of DAC capitalization related to reinsurance allowances for the three months ended June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. 27 [METLIFE LOGO] INDIVIDUAL OPERATIONS SPREADS BY PRODUCT UNAUDITED
-------------------------------------------------------------------- For the Three Months Ended -------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, VARIABLE & UNIVERSAL LIFE 2004 2004 2004 2005 2005 - -------------------------------------------------------------------------------------------------- ANNUALIZED GENERAL ACCOUNT SPREADS BY PRODUCT (%) Investment income yield 7.05% 7.04% 7.00% 7.07% 6.96% Average crediting rate 5.25% 5.17% 5.08% 5.00% 5.13% -------------------------------------------------------------------- Spread 1.80% 1.87% 1.92% 2.07% 1.83% --------------------------------------------------------------------
-------------------------------------------------------------------- For the Three Months Ended -------------------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, ANNUITIES 2004 2004 2004 2005 2005 - -------------------------------------------------------------------------------------------------- ANNUALIZED GENERAL ACCOUNT SPREADS BY PRODUCT (%) Investment income yield 6.23% 6.08% 6.37% 6.24% 6.69% Average crediting rate 3.79% 3.64% 3.57% 3.44% 3.43% -------------------------------------------------------------------- Spread 2.44% 2.44% 2.80% 2.80% 3.26% --------------------------------------------------------------------
28 [METLIFE LOGO] AUTO & HOME OPERATIONS STATEMENTS OF OPERATING EARNINGS - TOTAL UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date For the Three Months Ended Period Ended -------------------------------------------------------------------- ----------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Auto & Home Operations 2004 2004 2004 2005 2005 2004 2005 - -------------------------------------------------------------------------------------------------------- ----------------------- REVENUES Earned premiums $734 $740 $737 $728 $738 $1,471 $1,466 Investment income, net 44 40 41 43 46 90 89 Other revenues 6 8 12 9 8 15 17 -------------------------------------------------------------------- ----------------------- 784 788 790 780 792 1,576 1,572 -------------------------------------------------------------------- ----------------------- EXPENSES Losses 413 460 398 392 360 859 752 Loss adjustment expense 82 93 99 85 88 172 173 Other expenses 193 194 210 200 204 391 404 -------------------------------------------------------------------- ----------------------- 688 747 707 677 652 1,422 1,329 -------------------------------------------------------------------- ----------------------- Operating earnings before provision (benefit) for income taxes 96 41 83 103 140 154 243 Provision (benefit) for income taxes 25 7 20 27 39 37 66 -------------------------------------------------------------------- ----------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $71 $34 $63 $76 $101 $117 $177 ==================================================================== ======================= NET INCOME RECONCILIATION Operating earnings available to common shareholders $71 $34 $63 $76 $101 $117 $177 Net investment gains (losses) (5) (1) (3) 0 (4) (5) (4) Minority interest - net investment gains (losses) 0 0 0 0 0 0 0 Net investment gains (losses) tax benefit (provision) 2 0 1 0 1 2 1 -------------------------------------------------------------------- ----------------------- Net investment gains (losses), net of income taxes (3) (1) (2) 0 (3) (3) (3) Adjustments related to policyholder benefits and dividends 0 0 0 0 0 0 0 Adjustments related to other expenses 0 0 0 0 0 0 0 Adjustments related to tax benefit (provision) 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Adjustments related to net investment gains (losses), net of income taxes 0 0 0 0 0 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income available to common shareholders 68 33 61 76 98 114 174 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income $68 $33 $61 $76 $98 $114 $174 -------------------------------------------------------------------- -----------------------
29 (METLIFE LOGO) AUTO & HOME OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date For the Three Months Ended Period Ended -------------------------------------------------------------------- ----------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Auto & Home Operations 2004 2004 2004 2005 2005 2004 2005 - -------------------------------------------------------------------------------------------------------- ----------------------- REVENUES Earned premiums $538 $539 $538 $531 $533 $1,080 $1,064 Investment income, net 34 30 34 32 35 70 67 Other revenues 5 6 6 6 6 11 12 -------------------------------------------------------------------- ----------------------- 577 575 578 569 574 1,161 1,143 -------------------------------------------------------------------- ----------------------- EXPENSES Losses 296 300 312 304 272 647 576 Loss adjustment expense 63 66 85 74 70 135 144 Other expenses 135 136 148 137 141 274 278 -------------------------------------------------------------------- ----------------------- 494 502 545 515 483 1,056 998 -------------------------------------------------------------------- ----------------------- Operating earnings before provision for income taxes 83 73 33 54 91 105 145 Provision for income taxes 22 21 3 11 24 22 35 -------------------------------------------------------------------- ----------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $61 $52 $30 $43 $67 $83 $110 ==================================================================== ======================= $0 $0 Net investment gains (losses), net of income taxes (3) (1) (1) 0 (2) (3) (2) Adjustments related to net investment gains (losses), net of income taxes 0 0 0 0 0 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income available to common shareholders 58 51 29 43 65 80 108 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income $58 $51 $29 $43 $65 $80 $108 -------------------------------------------------------------------- -----------------------
30 (METLIFE LOGO) AUTO & HOME OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date For the Three Months Ended Period Ended -------------------------------------------------------------------- ----------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Homeowners 2004 2004 2004 2005 2005 2004 2005 - -------------------------------------------------------------------------------------------------------- ----------------------- REVENUES Earned premiums $185 $188 $188 $184 $193 $367 $377 Investment income, net 9 11 6 10 10 18 20 Other revenues 1 2 2 1 2 2 3 -------------------------------------------------------------------- ----------------------- 195 201 196 195 205 387 400 -------------------------------------------------------------------- ----------------------- EXPENSES Losses 106 155 83 82 82 195 164 Loss adjustment expense 19 26 13 11 17 37 28 Other expenses 54 52 57 56 58 106 114 -------------------------------------------------------------------- ----------------------- 179 233 153 149 157 338 306 -------------------------------------------------------------------- ----------------------- Operating earnings (loss) before provision (benefit) for income taxes 16 (32) 43 46 48 49 94 Provision (benefit) for income taxes 4 (14) 15 15 15 15 30 -------------------------------------------------------------------- ----------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $12 ($18) $28 $31 $33 $34 $64 ==================================================================== ======================= Net investment gains (losses), net of income taxes 0 0 (1) 0 (1) 0 (1) Adjustments related to net investment gains (losses), net of income taxes 0 0 0 0 0 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income available to common shareholders 12 (18) 27 31 32 34 63 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income $12 ($18) $27 $31 $32 $34 $63 -------------------------------------------------------------------- -----------------------
31 (METLIFE LOGO) AUTO & HOME OPERATIONS STATEMENTS OF OPERATING EARNINGS - PRODUCT LEVEL UNAUDITED (DOLLARS IN MILLIONS)
For the Year-to-Date For the Three Months Ended Period Ended -------------------------------------------------------------------- ----------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Auto & Home Operations 2004 2004 2004 2005 2005 2004 2005 - -------------------------------------------------------------------------------------------------------- ----------------------- REVENUES Earned premiums $11 $13 $11 $13 $12 $24 $25 Investment income, net 1 (1) 1 1 1 2 2 Other revenues 0 0 4 2 0 2 2 -------------------------------------------------------------------- ----------------------- 12 12 16 16 13 28 29 -------------------------------------------------------------------- ----------------------- EXPENSES Losses 11 5 3 6 6 17 12 Loss adjustment expense 0 1 1 0 1 0 1 Other expenses 4 6 5 7 5 11 12 -------------------------------------------------------------------- ----------------------- 15 12 9 13 12 28 25 -------------------------------------------------------------------- ----------------------- Operating earnings (loss) before provision (benefit) for income taxes (3) 0 7 3 1 0 4 Provision (benefit) for income taxes (1) 0 2 1 0 0 1 -------------------------------------------------------------------- ----------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS ($2) $0 $5 $2 $1 $0 $3 ==================================================================== ======================= Net investment gains (losses), net of income taxes 0 0 0 0 0 0 0 Adjustments related to net investment gains (losses), net of income taxes 0 0 0 0 0 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 0 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income available to common shareholders (2) 0 5 2 1 0 3 Preferred stock dividend 0 0 0 0 0 0 0 -------------------------------------------------------------------- ----------------------- Net income ($2) $0 $5 $2 $1 $0 $3 -------------------------------------------------------------------- -----------------------
32 (METLIFE LOGO) AUTO & HOME OPERATIONS WRITTEN PREMIUMS BY PRODUCT AND SELECTED FINANCIAL INFORMATION AND SUPPLEMENTAL DATA
For the Three Months Ended ---------------------------------------------------------- June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - -------------------------------------------------------------------------------------------------- WRITTEN PREMIUMS BY PRODUCT Preferred/Standard Automobile $521 $534 $502 $512 $519 Non-Standard Automobile 19 19 21 17 15 Homeowners 199 212 186 160 212 Other 9 11 9 17 12 ---------------------------------------------------------- Total $748 $776 $718 $706 $758 ========================================================== SELECTED FINANCIAL INFORMATION AND SUPPLEMENTAL DATA TOTAL AUTO & HOME Loss and loss adjustment expense ratio 67.5% 74.6% 67.2% 65.7% 60.4% Other expense ratio 25.6% 25.5% 28.0% 26.7% 27.2% ---------------------------------------------------------- Total combined ratio (1) 93.1% 100.1% 95.2% 92.4% 87.6% Effect of catastrophe losses 5.0% 15.3% 3.0% 1.5% 1.2% ---------------------------------------------------------- Combined ratio excluding catastrophes 88.1% 84.8% 92.2% 90.9% 86.4% ========================================================== AUTO Loss and loss adjustment expense ratio 66.9% 68.0% 73.7% 71.5% 63.6% Other expense ratio 24.3% 24.3% 26.9% 25.0% 26.0% ---------------------------------------------------------- Total combined ratio (1) 91.2% 92.3% 100.6% 96.5% 89.6% Effect of catastrophe losses 1.1% 1.7% 0.5% 0.4% 0.1% ---------------------------------------------------------- Combined ratio excluding catastrophes 90.1% 90.6% 100.1% 96.1% 89.5% ========================================================== HOMEOWNERS Loss and loss adjustment expense ratio 67.3% 96.0% 50.8% 50.2% 51.4% Other expense ratio 28.8% 27.6% 30.1% 29.7% 29.8% ---------------------------------------------------------- Total combined ratio (1) 96.1% 123.6% 80.9% 79.9% 81.2% Effect of catastrophe losses 16.6% 55.4% 10.2% 4.9% 4.4% ---------------------------------------------------------- Combined ratio excluding catastrophes 79.5% 68.2% 70.7% 75.0% 76.8% ========================================================== OTHER Loss and loss adjustment expense ratio 100.9% 40.3% 33.7% 49.3% 60.7% Other expense ratio 35.4% 39.9% 43.8% 56.1% 38.7% ---------------------------------------------------------- Total combined ratio (1) 136.3% 80.2% 77.5% 105.4% 99.4% Effect of catastrophe losses 0.0% 0.0% 0.0% 0.0% 0.0% ---------------------------------------------------------- Combined ratio excluding catastrophes 136.3% 80.2% 77.5% 105.4% 99.4% ========================================================== PRE-TAX CATASTROPHE LOSSES Auto $6 $9 $3 $2 $1 Homeowners 31 104 20 9 9 Other 0 0 0 0 0 ---------------------------------------------------------- Total $37 $113 $23 $11 $10 ========================================================== CATASTROPHE POINTS ON COMBINED RATIOS 5.0 15.3 3.0 1.6 1.2 NUMBER OF SALES REPRESENTATIVES 88 80 87 89 89 ----------------------------------------------------------
(1) The combined ratio reflects payment fees as a credit to Other Expenses for the three months ended June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, which resulted in a 0.7, 0.7, 0.7, 0.8 and 0.7 of a percentage point decrease in the combined ratio for the periods ended, respectively. The decreases for Auto, Homeowners and Other were 0.8, 0.5, and 0.6 of a percentage point, respectively, for June 30, 2004, 0.8, 0.4 and 0.7, of a percentage point, respectively, for September 30, 2004, 0.8, 0.4 and 0.7 of a percentage point, respectively, for December 31, 2004, 0.8, 0.5 and 0.5 of a percentage point, respectively, for March 31, 2005 and 0.7, 0.4 and 0.8 of a percentage point, respectively, for June 30, 2005. 33 (METLIFE LOGO) INTERNATIONAL OPERATIONS STATEMENT OF OPERATING EARNINGS
For the Year-to-Date For the Three Months Ended Period Ended ------------------------------------------------------------- -------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 2004 2005 - -------------------------------------------------------------------------------------------------------------- ------------------- REVENUES Premiums $392 $437 $463 $502 $455 $794 $957 Universal life and investment-type product policy fees 86 91 90 119 126 169 245 Investment income, net 137 151 174 150 194 260 344 Other revenues 8 2 9 3 (1) 12 2 ------------------------------------------------------------- -------------------- 623 681 736 774 774 1,235 1,548 ------------------------------------------------------------- -------------------- EXPENSES Policyholder benefits and dividends 400 424 450 446 451 778 897 Interest credited to policyholder account balances 32 37 46 47 55 69 102 Capitalization of deferred policy acquisition costs (93) (103) (117) (125) (138) (164) (263) Amortization of deferred policy acquisition costs 36 32 38 56 56 67 112 Other expenses 194 222 283 246 277 366 523 ------------------------------------------------------------- -------------------- 569 612 700 670 701 1,116 1,371 ------------------------------------------------------------- -------------------- Operating earnings before provision for income taxes 54 69 36 104 73 119 177 Provision for income taxes 13 24 10 37 23 34 60 ------------------------------------------------------------- -------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $41 $45 $26 $67 $50 $85 $117 ============================================================= ==================== NET INCOME RECONCILIATION Operating earnings available to commom shareholders $41 $45 $26 $67 $50 $85 $117 Net investment gains (losses) (2) 3 (4) 0 7 24 7 Minority interest - net investment gains (losses) 0 0 0 0 0 0 0 Net investment gains (losses) tax benefit (provision) (1) (1) 1 0 (2) (7) (2) ------------------------------------------------------------- -------------------- Net investment gains (losses), net of income taxes (3) 2 (3) 0 5 17 5 Adjustments related to policyholder benefits and dividends 49 (14) (6) 14 (16) 52 (2) Adjustments related to other expenses 0 0 0 0 0 0 0 Adjustments related to tax benefit (provision) (17) 5 2 (5) 6 (18) 1 ------------------------------------------------------------- -------------------- Adjustments related to net investment gains (losses), net of income taxes (1) 32 (9) (4) 9 (10) 34 (1) Cumulative effect of a change in accounting, net of income taxes (2) 0 0 0 0 0 (30) 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 ------------------------------------------------------------- -------------------- Net income available to common shareholders 70 38 19 76 45 106 121 Preferred stock dividend 0 0 0 0 0 0 0 ------------------------------------------------------------- -------------------- Net income $70 $38 $19 $76 $45 $106 $121 ------------------------------------------------------------- -------------------- ------------------------------------------------------------- NUMBER OF PROFESSIONAL SALES REPRESENTATIVES 1,810 3,222 3,491 3,749 3,913 -------------------------------------------------------------
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs and amounts allocable to certain participating contracts. (2)The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. 34 (METLIFE LOGO) REINSURANCE OPERATIONS STATEMENT OF OPERATING EARNINGS
For the Year-to-Date For the Three Months Ended Period Ended ------------------------------------------------------------- -------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 2004 2005 - -------------------------------------------------------------------------------------------------------------- -------------------- REVENUES Premiums, net $807 $822 $922 $907 $934 $1,623 $1,841 Investment income, net 136 144 204 161 151 266 312 Other revenues 15 14 16 11 21 27 32 ------------------------------------------------------------- -------------------- 958 980 1,142 1,079 1,106 1,916 2,185 ------------------------------------------------------------- -------------------- EXPENSES Claims and other policy benefits 651 675 760 750 842 1,310 1,592 Interest credited to policyholder account balances 52 48 61 55 44 103 99 Policy acquisition costs and other insurance expenses 133 156 192 148 165 272 313 Other expenses 46 47 44 43 41 91 84 ------------------------------------------------------------- -------------------- 882 926 1,057 996 1,092 1,776 2,088 ------------------------------------------------------------- -------------------- Operating earnings before provision for income taxes and minority interest 76 54 85 83 14 140 97 Provision for income taxes 13 9 15 13 0 22 13 ------------------------------------------------------------- -------------------- Operating earnings available to common shareholders before minority interest 63 45 70 70 14 118 84 Elimination of minority interest, before tax 40 31 39 43 11 77 54 ------------------------------------------------------------- -------------------- CONTRIBUTION TO METLIFE $23 $14 $31 $27 $3(3) $41 $30 (3) ============================================================= ==================== NET INCOME RECONCILIATION Operating earnings $23 $14 $31 $27 $3 $41 $30 Net investment gains (losses) 32 (17) (2) 28 (7) 53 21 Minority interest - net investment gains (losses) (8) 2 1 (5) (2) (16) (7) Net investment gains (losses) tax benefit (provision) (9) 6 1 (8) 6 (13) (2) ------------------------------------------------------------- -------------------- Net investment gains (losses), net of income taxes 15 (9) 0 15 (3) 24 12 Adjustments related to policyholder benefits and dividends 0 0 0 0 0 0 0 Adjustments related to other expenses (13) 14 1 (17) 12 (17) (5) Adjustments related to tax benefit (provision) 5 (5) 0 6 (6) 6 0 ------------------------------------------------------------- -------------------- Adjustments related to net investment gains (losses), net of income taxes (1) (8) 9 1 (11) 6 (11) (5) Cumulative effect of a change in accounting, net of income taxes (2) 0 0 0 0 0 5 0 Discontinued operations, net of income taxes 0 0 0 0 0 0 0 ------------------------------------------------------------- -------------------- Net income available to common shareholders 30 14 32 31 6 59 37 Preferred stock dividend 0 0 0 0 0 0 0 ------------------------------------------------------------- -------------------- Net income $30 $14 $32 $31 $6 $59 $37 ------------------------------------------------------------- --------------------
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amortization of deferred policy acquisition costs. (2) The cumulative effect of a change in accounting, net of income taxes, for the period ended March 31, 2004, is in accordance with AICPA Statement of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts. (3) Operating earnings available to common shareholders for the three months ended June 30, 2005 includes an $8 million charge, net of income taxes, associated with establishment of a liability associated with the Argentine pension business. 35 (METLIFE LOGO) REINSURANCE OPERATIONS PRE-TAX AND PRE-MINORITY INTEREST OPERATING EARNINGS BY REGION AND RESERVES BY REGION
For the Three Months Ended ------------------------------------------------------------------------ June 30, September 30, December 31, March 31. June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ PRE-TAX AND PRE-MINORITY INTEREST OPERATING EARNINGS BY REGION United States $60 $69 $82 $50 $28 Canada 15 16 17 23 17 Asia-Pacific 5 (2) 2 5 14 Other international markets 11 9 4 15 (7) Corporate (15) (38) (20) (10) (38) ------------------------------------------------------------------------ Total pre-tax and pre-minority interest operating earnings $76 $54 $85 $83 $14 ======================================================================== POLICY BENEFITS AND INTEREST SENSITIVE CONTRACT LIABILITIES BY REGION Traditional U.S. $4,385 $4,458 $4,253 $4,285 $4,365 Asset intensive 3,645 3,893 4,085 4,159 4,267 Other 125 58 124 122 126 ------------------------------------------------------------------------ Total U.S. 8,155 8,409 8,462 8,566 8,758 ------------------------------------------------------------------------ Canada 1,167 1,243 1,375 1,367 1,389 Asia-Pacific 357 456 517 548 611 Other international markets 497 549 610 693 702 ------------------------------------------------------------------------ Total International 2,021 2,248 2,502 2,608 2,702 ------------------------------------------------------------------------ Total policy benefits and interest sensitive contract liabilities $10,176 $10,657 $10,964 $11,174 $11,460 ------------------------------------------------------------------------
36 (METLIFE LOGO) CORPORATE, OTHER & ELIMINATIONS STATEMENT OF OPERATING EARNINGS
For the Year-to-Date For the Three Months Ended Period Ended ------------------------------------------------------------- -------------------- June 30, September 30, December 31, March 31, June 30, June 30, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 2004 2005 - -------------------------------------------------------------------------------------------------------------- -------------------- REVENUES Premiums ($4) ($5) $1 $1 $3 ($5) $4 Universal life and investment-type product policy fees 0 2 0 0 0 0 0 Investment income, net 163 129 195 150 192 247 342 Other revenues (7) 7 0 3 5 0 8 ------------------------------------------------------------- -------------------- 152 133 196 154 200 242 354 ------------------------------------------------------------- -------------------- EXPENSES Policyholder benefits and dividends 2 1 3 5 (45) 4 (40) Interest credited to policyholder account balances 0 0 0 0 0 0 0 Interest expense 88 94 97 105 110 166 215 Other expenses 76 44 75 76 57 130 133 ------------------------------------------------------------- -------------------- 166 139 175 186 122 300 308 ------------------------------------------------------------- -------------------- Operating earnings before (benefit) provision for income taxes (14) (6) 21 (32) 78 (58) 46 Benefit for income taxes (111) (34) (7) (41) (1) (138) (42) ------------------------------------------------------------- -------------------- Operating earnings 97 28 28 9 79 80 88 Preferred stock dividend 0 0 0 0 0 0 0 ------------------------------------------------------------- -------------------- OPERATING EARNINGS AVAILABLE TO COMMON SHAREHOLDERS $97 $28 $28 $9 $79(4) $80 $88 (4) ============================================================= ==================== NET INCOME RECONCILIATION Operating earnings available to common shareholders $97 $28 $28 $9 $79 $80 $88 Net investment gains (losses) 83 (17) (86) (113) 1,314 87 1,201 Minority interest - net investment gains (losses) 0 0 0 0 0 0 0 Net investment gains (losses) tax benefit (provision) (31) 3 33 43 (468) (33) (425) ------------------------------------------------------------- -------------------- Net investment gains (losses), net of income taxes 52 (14) (53) (70) 846 54 776 Adjustments related to policyholder benefits and dividends 0 0 0 0 0 0 0 Adjustments related to other expenses 0 0 0 0 0 0 0 Adjustments related to tax benefit (provision) 0 1 (1) 0 0 0 0 ------------------------------------------------------------- -------------------- Adjustments related to net investment gains (losses), net of income taxes (1) 0 1 (1) 0 0 0 0 Cumulative effect of a change in accounting, net of income taxes 0 0 0 0 0 (1) 0 Discontinued operations, net of income taxes 14 5 (4) 151 0 18 151 ------------------------------------------------------------- -------------------- Net income available to common shareholders 163 20 (30) 90 925 151 1,015 Preferred stock dividend 0 0 0 0 0 0 0 ------------------------------------------------------------- -------------------- Net income $163 $20 ($30) $90 $925 $151 $1,015 ------------------------------------------------------------- --------------------
(1) Adjustments related to net investment gains (losses), net of income taxes, includes amounts allocable to certain participating contracts. (2) Operating earnings available to common shareholders for the period ended June 30, 2004 includes a $32 million charge, net of income taxes, from a contribution to the MetLife Foundation made by Metropolitan Life Insurance Company and a $105 million benefit related to a previously disclosed resolution of an IRS audit. (3) Operating earnings available to common shareholders for the three months ended September 30, 2004 includes a $9 million benefit from a revision of the estimate of income taxes for 2003. (4) Operating earnings available to common shareholders for the three months ended June 30, 2005 includes a $30 million benefit, net of income taxes, associated with the reduction of a previously established liability for settlement death benefits related to the Company's sales practices class action settlement recorded in 1999 and a $18 million benefit, net of income taxes, associated with the reduction of a previously established liability related to the Company's demutualization in 2000. 37 (METLIFE LOGO) ================================================================================ METLIFE, INC. INVESTMENT RESULTS BY ASSET CATEGORY AND ANNUALIZED YIELDS
------------------------------------------------------------------------ At or for the Three Months Ended ------------------------------------------------------------------------ June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ FIXED MATURITIES (1) Yield (2) 6.64% 6.44% 6.46% 6.33% 6.31% Income (3) $2,291 $2,246 $2,273 $2,278 $2,306 Investment gains (losses) ($3) $61 ($21) ($114) ($89) Ending Carrying Value (3) $170,192 $176,091 $176,763 $182,653 $185,218 MORTGAGE AND CONSUMER LOANS Yield (4) 6.83% 7.02% 6.93% 6.55% 6.68% Income $468 $507 $537 $527 $547 Investment gains (losses) $0 ($8) ($39) ($11) ($8) Ending Carrying Value $28,118 $29,620 $32,406 $31,977 $33,586 REAL ESTATE AND REAL ESTATE JOINT VENTURES Yield (4) 13.37% 10.55% 11.04% 11.11% 12.82% Income (5) $148 $111 $117 $119 $130 Investment gains (losses) (6) $133 ($5) $13 $18 $1,904 Ending Carrying Value $4,150 $4,263 $4,233 $4,306 $3,803 POLICY LOANS Yield (4) 6.13% 6.14% 6.23% 6.17% 6.19% Income $134 $135 $138 $138 $139 Ending Carrying Value $8,766 $8,801 $8,899 $8,953 $8,975 EQUITY SECURITIES AND OTHER LIMITED PARTNERSHIP INTERESTS (1) Yield (4) 10.32% 7.42% 18.26% 9.84% 21.01% Income $101 $75 $199 $118 $276 Investment gains (losses) $87 $96 $25 $95 $12 Ending Carrying Value $4,521 $4,715 $5,095 $5,567 $6,015 CASH AND SHORT-TERM INVESTMENTS (1) Yield (4) 2.39% 3.16% 3.67% 4.76% 3.66% Income $30 $43 $50 $64 $93 Investment gains (losses) $0 $0 ($1) ($1) $0 Ending Carrying Value $6,501 $6,043 $6,714 $6,476 $15,778 OTHER INVESTED ASSETS Yield (4) 4.29% 5.51% 10.55% 9.06% 7.74% Income (7) $46 $55 $104 $95 $94 Investment gains (losses) (8) ($60) $34 ($191) ($8) $406 Ending Carrying Value $5,108 $4,395 $4,926 $4,960 $6,079 TOTAL INVESTMENTS Gross investment income yield 6.72% 6.51% 6.88% 6.55% 6.76% Investment fees and expenses yield (0.13%) (0.13%) (0.14%) (0.12%) (0.15%) ------------------------------------------------------------------------ NET INVESTMENT INCOME YIELD 6.59% 6.38% 6.74% 6.43% 6.61% ======================================================================== Gross investment income $3,218 $3,172 $3,418 $3,339 $3,585 Investment fees and expenses (61) (65) (72) (59) (78) ------------------------------------------------------------------------ NET INVESTMENT INCOME $3,157 $3,107 $3,346 $3,280 $3,507 ======================================================================== Ending Carrying Value $227,356 $233,928 $239,036 $244,892 $259,454 ======================================================================== Gross investment gains $411 $351 $309 $373 $2,133 Gross investment losses (126) (201) (175) (322) (231) Writedowns (77) (44) (79) (51) (42) ------------------------------------------------------------------------ Subtotal 208 106 55 0 1,860 Derivative & other instruments not qualifying for hedge accounting (51) 72 (269) (21) 365 ------------------------------------------------------------------------ NET INVESTMENT GAINS (LOSSES) 157 178 (214) (21) 2,225 Minority interest - net investment gains (losses (8) 2 5 (9) (2) Net investment gains (losses) tax benefit (provision) (47) (62) 71 9 (784) ------------------------------------------------------------------------ NET INVESTMENT GAINS (LOSSES), NET OF INCOME TAXES $102 $118 ($138) ($21) $1,439 ------------------------------------------------------------------------
(1) Included in ending carrying value, income and investment gains (losses) are $2,241 million, $23 million and $2 million, respectively, related to the consolidation of separate accounts under AICPA Statement of Position 03-1 for the three months ended June 30, 2005. (2) The fixed maturities yield is annualized and is based on quarterly average amortized cost. (3) Fixed maturities includes $197 million and $2 million in ending carrying value and income, respectively, relating to trading securities for the three months ended June 30, 2005. (4) Yields are annualized and based on quarterly average carrying values. (5) Included in income from real estate and real estate joint ventures is $53 million, $33 million, $30 million, $39 million and $12 million related to discontinued operations for the three months ended June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. (6) Included in investment gains (losses) from real estate and real estate joint ventures is $132 million, ($15) million, $10 million, $18 million and $1,905 million related to discontinued operations for the three months ended June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. (7) Included in income from other invested assets are scheduled settlement payments on derivative instruments that do not qualify for hedge accounting under Statement of Financial Accounting Standards No. 133 of $22 million, $12 million, $3 million, $24 million and $13 million for the three months ended June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. (8) Included in investment gains (losses) for the three months ended December 31, 2004 is a charge of $26 million related to a funds withheld reinsurance treaty that was converted to a coinsurance agreement. 38 (METLIFE LOGO) ================================================================================ METLIFE, INC. INVESTMENT RESULTS BY ASSET CATEGORY AND ANNUALIZED YIELDS
------------------------------------------------------------------------ At or for the Year-to-Date ------------------------------------------------------------------------ June 30, September 30, December 31, March 31, June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ------------------------------------------------------------------------------------------------------------------------------------ FIXED MATURITIES (1) Yield (2) 6.64% 6.58% 6.55% 6.33% 6.34% Income $4,523 $6,769 $9,042 $2,278 $4,584 Investment gains (losses) $31 $92 $71 ($114) ($203) Ending Carrying Value $170,192 $176,091 $176,763 $182,653 $185,218 MORTGAGE AND CONSUMER LOANS Yield (3) 6.80% 6.87% 6.86% 6.55% 6.58% Income $917 $1,424 $1,961 $527 $1,074 Investment gains (losses) $0 ($8) ($47) ($11) ($19) Ending Carrying Value $28,118 $29,620 $32,406 $31,977 $33,586 REAL ESTATE AND REAL ESTATE JOINT VENTURES Yield (3) 12.72% 11.92% 11.69% 11.11% 12.08% Income (4) $287 $398 $515 $119 $249 Investment gains (losses) (5) $154 $149 $162 $18 $1,922 Ending Carrying Value $4,150 $4,263 $4,233 $4,306 $3,803 POLICY LOANS Yield (3) 6.12% 6.13% 6.15% 6.17% 6.18% Income $268 $403 $541 $138 $277 Ending Carrying Value $8,766 $8,801 $8,899 $8,953 $8,975 EQUITY SECURITIES AND OTHER LIMITED PARTNERSHIP INTERESTS (1) Yield (3) 6.74% 6.96% 9.96% 9.84% 15.69% Income $130 $205 $404 $118 $394 Investment gains (losses) $87 $183 $208 $95 $107 Ending Carrying Value $4,521 $4,715 $5,095 $5,567 $6,015 CASH AND SHORT-TERM INVESTMENTS (1) Yield (3) 2.47% 2.77% 3.01% 4.76% 3.64% Income $60 $103 $153 $64 $157 Investment gains (losses) $0 $0 ($1) ($1) ($1) Ending Carrying Value $6,501 $6,043 $6,714 $6,476 $15,778 OTHER INVESTED ASSETS Yield (3) 4.68% 5.03% 6.30% 9.06% 8.14% Income (6) $97 $152 $256 $95 $189 Investment gains (losses) (7) $8 $42 ($149) ($8) $398 Ending Carrying Value $5,108 $4,395 $4,926 $4,960 $6,079 TOTAL INVESTMENTS Gross investment income yield 6.64% 6.60% 6.67% 6.55% 6.64% Investment fees and expenses yield (0.13%) (0.13%) (0.14%) (0.12%) (0.13%) ------------------------------------------------------------------------ NET INVESTMENT INCOME YIELD 6.51% 6.47% 6.53% 6.43% 6.51% ======================================================================== Gross investment income $6,282 $9,454 $12,872 $3,339 $6,924 Investment fees and expenses (125) (190) (262) (59) (137) ------------------------------------------------------------------------ NET INVESTMENT INCOME $6,157 $9,264 $12,610 $3,280 $6,787 ======================================================================== Ending Carrying Value $227,356 $233,928 $239,036 $244,892 $259,454 ======================================================================== Gross investment gains $654 $1,005 $1,314 $373 $2,506 Gross investment losses (211) (412) (587) (322) (553) Writedowns (89) (133) (212) (51) (93) ------------------------------------------------------------------------ Subtotal 354 460 515 0 1,860 Derivative & other instruments not qualifying for hedge accounting (74) (2) (271) (21) 344 ------------------------------------------------------------------------ NET INVESTMENT GAINS (LOSSES) 280 458 244 (21) 2,204 Minority interest -- net investment gains (losses) (16) (14) (9) (9) (11) Net investment gains (losses) tax benefit (provision) (86) (148) (77) 9 (775) ------------------------------------------------------------------------ NET INVESTMENT GAINS (LOSSES), NET OF INCOME TAXES $178 $296 $158 ($21) $1,418 ------------------------------------------------------------------------
(1) Included in ending carrying value, income and investment-related gains (losses) is $2,241 million, $44 million and $14 million, respectively, related to the consolidation of separate accounts under AICPA Statement of Position 03-1 for year-to-date June 30, 2005. (2) The fixed maturities yield is annualized and is based on quarterly average amortized cost. (3) Yields are annualized and based on quarterly average carrying values. (4) Included in income from real estate and real estate joint ventures is $102 million, $135 million, $165 million, $39 million and $51 million related to discontinued operations for year-to-date June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. (5) Included in investment gains (losses) from real estate and real estate joint ventures is $152 million, $136 million, $146 million, $18 million and $1,923 million related to discontinued operations for year-to-date June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. (6) Included in income from other invested assets are scheduled settlement payments on derivative instruments that do not qualify for hedge accounting under Statement of Financial Accounting Standards No. 133 of $36 million, $48 million, $51 million, $24 million and $37 million for the year-to-date June 30, 2004, September 30, 2004, December 31, 2004, March 31, 2005 and June 30, 2005, respectively. (7) Included in investment gains (losses) for the three months ended December 31, 2004 is a charge of $26 million related to a funds withheld reinsurance treaty that was converted to a coinsurance agreement. 39 (METLIFE LOGO) METLIFE, INC. GROSS UNREALIZED GAINS AND LOSSES AGING SCHEDULE FIXED MATURITIES (1) (2)
At June 30, 2004 At September 30, 2004 At December 31, 2004 At March 31, 2005 ------------------------------------------------------------------------------------------- Unaudited (Dollars in millions) Amount % of Total Amount % of Total Amount % of Total Amount % of Total - ----------------------------------------------------------------------------------------------------------------------------------- Less than 20% $1,735 96.6% $530 90.8% $463 92.4% $1,185 99.1% 20% or more for less than six months 47 2.6% 44 7.5% 17 3.4% 5 0.4% 20% or more for six months or greater 15 0.8% 10 1.7% 21 4.2% 6 0.5% ------------------------------------------------------------------------------------------- Total Gross Unrealized Losses $1,797 100.0% $584 100.0% $501 100.0% $1,196 100.0% Total Gross Unrealized Gains $7,087 $9,703 $10,268 $8,485 ======= ======= ======= ========
At June 30, 2005 ------------------------ Unaudited (Dollars in millions) Amount % of Total - --------------------------------------------------------------- Less than 20% $416 95.4% 20% or more for less than six months 13 3.0% 20% or more for six months or greater 7 1.6% ------------------------ Total Gross Unrealized Losses $436 100.0% Total Gross Unrealized Gains $11,250 =========
GROSS UNREALIZED GAINS AND LOSSES AGING SCHEDULE EQUITY SECURITIES (1)
At June 30, 2004 At September 30, 2004 At December 31, 2004 At March 31, 2005 ------------------------------------------------------------------------------------------- Unaudited (Dollars in millions) Amount % of Total Amount % of Total Amount % of Total Amount % of Total ----------------------------------------------------------------------------------------------------------------------------------- Less than 20% $13 44.8% $10 40.0% $7 87.5% $44 78.6% 20% or more for less than six months 16 55.2% 15 60.0% 1 12.5% 12 21.4% 20% or more for six months or greater 0 0.0% 0 0.0% 0 0.0% 0 0.0% ------------------------------------------------------------------------------------------- Total Gross Unrealized Losses $29 100.0% $25 100.0% $8 100.0% $56 100.0% Total Gross Unrealized Gains $336 $305 $283 $169 ==== ====== ===== ======
At June 30, 2005 ----------------------- Unaudited (Dollars in millions) Amount % of Total - ---------------------------------------------------------------- Less than 20% $25 61.5% 20% or more for less than six months 15 38.5% 20% or more for six months or greater 0 0.0% ----------------------- Total Gross Unrealized Losses $40 100.0% Total Gross Unrealized Gains $206 =======
(1) The Company's review of its fixed maturities and equity securities for impairments includes an analysis of the total gross unrealized losses by three categories of securities: (i) securities where the estimated fair value had declined and remained below amortized cost by less than 20%; (ii) securities where the estimated fair value had declined and remained below amortized cost by 20% or more for less than six months; and (iii) securities where the estimated value had declined and remained below amortized cost by 20% or more for six months or greater. 40 (METLIFE LOGO) METLIFE, INC. SUMMARY OF FIXED MATURITIES AVAILABLE FOR SALE BY SECTOR AND QUALITY DISTRIBUTION
At June 30, 2004 At September 30, 2004 At December 31, 2004 -------------------------------------------------------------------------- Unaudited (Dollars in millions) Amount % of Total Amount % of Total Amount % of Total - ---------------------------------------------------------------------------------------------------------------------- U.S. corporate securities $60,619 35.6% $63,130 35.8% $ 61,720 34.9% Residential mortgage-backed securities 30,698 18.0% 30,978 17.6% 32,230 18.2% Foreign corporate securities 24,732 14.5% 27,076 15.4% 27,838 15.7% US treasury/agency securities 16,664 9.8% 16,561 9.4% 17,826 10.1% Commercial mortgage-backed securities 12,019 7.1% 12,016 6.8% 12,501 7.1% Asset-backed securities 12,444 7.3% 12,912 7.3% 10,876 6.1% Foreign government securities 8,019 4.7% 8,380 4.8% 8,585 4.9% State and political subdivision securities 3,675 2.2% 3,853 2.2% 3,899 2.2% Other fixed maturity securities 780 0.5% 644 0.4% 985 0.6% -------------------------------------------------------------------------- Total bonds 169,650 99.7% 175,550 99.7% 176,460 99.8% Redeemable preferred stock 542 0.3% 541 0.3% 303 0.2% -------------------------------------------------------------------------- Total fixed maturities $170,192 100.0% $176,091 100.0% $176,763 100.0% ========================================================================== NAIC RATING AGENCY RATING (1) EQUIVALENT DESIGNATION 1 Aaa / Aa / A $113,607 66.8% $117,658 66.8% $118,779 67.2% 2 Baa 43,829 25.8% 45,728 25.9% 45,311 25.6% 3 Ba 7,334 4.3% 7,514 4.3% 7,500 4.2% 4 B 4,086 2.4% 4,089 2.3% 4,414 2.5% 5 Caa and lower 583 0.3% 443 0.3% 366 0.2% 6 In or near default 211 0.1% 118 0.1% 90 0.1% -------------------------------------------------------------------------- Total bonds 169,650 99.7% 175,550 99.7% 176,460 99.8% Redeemable preferred stock 542 0.3% 541 0.3% 303 0.2% -------------------------------------------------------------------------- Total Fixed Maturities $170,192 100.0% $176,091 100.0% $176,763 100.0% ==========================================================================
At March 31, 2005 At June 30, 2005 ------------------------------------------------------------ Unaudited (Dollars in millions) Amount % of Total Amount % of Total - ----------------------------------------------------------------------------------------------------------- U.S. corporate securities $60,417 33.1% $61,614 33.3% Residential mortgage-backed securities 34,650 19.0% 34,795 18.8% Foreign corporate securities 27,766 15.2% 28,557 15.4% US treasury/agency securities 21,770 11.9% 21,051 11.4% Commercial mortgage-backed securities 13,372 7.3% 13,836 7.5% Asset-backed securities 10,826 5.9% 10,373 5.6% Foreign government securities 8,932 4.9% 10,144 5.5% State and political subdivision securities 3,934 2.2% 3,780 2.0% Other fixed maturity securities 703 0.4% 716 0.4% ---------------------------------------------------------- Total bonds 182,370 99.9% 184,866 99.9% Redeemable preferred stock 149 0.1% 155 0.1% ---------------------------------------------------------- Total fixed maturities $182,519 100.0% $185,021 100.0% ========================================================== NAIC RATING AGENCY RATING (1) EQUIVALENT DESIGNATION 1 Aaa / Aa / A $125,899 69.0% $127,913 69.1% 2 Baa 44,054 24.1% 44,202 23.9% 3 Ba 7,392 4.1% 7,476 4.0% 4 B 4,649 2.5% 4,910 2.7% 5 Caa and lower 325 0.2% 335 0.2% 6 In or near default 51 0.0% 30 0.0% ---------------------------------------------------------- Total 182,370 99.9% 184,866 99.9% Redeemable preferred stock 149 0.1% 155 0.1% ---------------------------------------------------------- Total Fixed Maturities $182,519 100.0% $185,021 100.0% ==========================================================
(1) Amounts presented are based on rating agency designations. Comparisons between NAIC ratings and rating agency designations are published by the NAIC. METLIFE, INC. SUMMARY OF COMMERCIAL MORTGAGE LOANS BY REGION AND PROPERTY TYPE
At June 30, 2004 At September 30, 2004 At December 31, 2004 ------------------------------------------------------------------------- Unaudited (Dollars in millions) Amount % of Total Amount % of Total Amount % of Total - --------------------------------------------------------------------------------------------------------------------- Pacific $5,327 24.2% $5,608 24.3% $6,075 24.3% South Atlantic 5,247 23.8% 5,502 23.6% 5,696 22.8% Middle Atlantic 3,513 16.0% 3,704 15.9% 4,057 16.2% East North Central 2,294 10.4% 2,443 10.5% 2,550 10.2% West South Central 1,470 6.7% 1,775 7.6% 2,024 8.1% New England 1,302 5.9% 1,285 5.5% 1,412 5.6% International 1,064 4.8% 1,219 5.2% 1,364 5.5% Mountain 785 3.6% 741 3.2% 778 3.1% West North Central 625 2.8% 615 2.6% 667 2.7% East South Central 278 1.3% 276 1.2% 268 1.1% Other 100 0.5% 99 0.4% 99 0.4% -------------------------------------------------------------------------- Total $22,005 100.0% $23,267 100.0% $24,990 100.0% ========================================================================== Office 10,301 46.8% $10,826 46.6% $11,500 46.0% Retail 5,221 23.7% 5,288 22.7% 5,698 22.8% Apartments 3,001 13.6% 3,095 13.3% 3,264 13.1% Industrial 1,951 8.9% 2,034 8.7% 2,499 10.0% Hotel 1,098 5.0% 1,227 5.3% 1,245 5.0% Other 433 2.0% 797 3.4% 784 3.1% -------------------------------------------------------------------------- Total $22,005 100.0% $23,267 100.0% $24,990 100.0% ==========================================================================
At March 31, 2005 At June 30, 2005 ------------------------------------------------------------ Unaudited (Dollars in millions) Amount % of Total Amount % of Total - ----------------------------------------------------------------------------------------------------------- Pacific $5,888 23.9% $6,224 23.8% South Atlantic 5,613 22.8% 6,005 23.0% Middle Atlantic 3,898 15.8% 4,007 15.4% East North Central 2,565 10.4% 2,868 11.0% West South Central 2,139 8.7% 2,140 8.2% New England 1,409 5.7% 1,438 5.5% International 1,343 5.5% 1,395 5.3% Mountain 780 3.2% 868 3.3% West North Central 631 2.5% 698 2.7% East South Central 267 1.1% 360 1.4% Other 98 0.4% 97 0.4% ----------------------------------------------------------- Total $24,631 100.0% $26,100 100.0% =========================================================== Office $10,798 43.8% $11,776 45.0% Retail 5,754 23.4% 6,073 23.3% Apartments 3,330 13.5% 3,416 13.1% Industrial 2,749 11.2% 2,813 10.8% Hotel 1,212 4.9% 1,295 5.0% Other 788 3.2% 727 2.8% ----------------------------------------------------------- Total $24,631 100.0% $26,100 100.0% ===========================================================
41 (METLIFE LOGO) METLIFE, INC. SUMMARY OF REAL ESTATE
At June 30, At September 30, At December 31, At March 31, At June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ---------------------------------------------------------------------------------------------------------------------- Wholly owned $3,823 $3,911 $3,843 $3,768 $3,277 Joint ventures 325 350 386 534 523 -------------------------------------------------------------------------- Subtotal 4,148 4,261 4,229 4,302 3,800 Foreclosed 2 2 4 4 3 -------------------------------------------------------------------------- Total Real Estate (1) $4,150 $4,263 $4,233 $4,306 $3,803 ===========================================================---------------
(1) Includes real estate held-for-sale and held-for-investment. METLIFE, INC. SUMMARY OF MORTGAGES AND CONSUMER LOANS
At June 30, At September 30, At December 31, At March 31, At June 30, Unaudited (Dollars in millions) 2004 2004 2004 2005 2005 - ---------------------------------------------------------------------------------------------------------------------- COMMERCIAL MORTGAGES $22,005 $23,267 $24,990 $24,631 $26,100 AGRICULTURAL MORTGAGES 5,377 5,593 5,907 5,929 6,040 CONSUMER LOANS 736 760 1,509 1,417 1,446 -------------------------------------------------------------------------- TOTAL $28,118 $29,620 $32,406 $31,977 $33,586 ===========================================================---------------
METLIFE, INC. DISTRIBUTION OF ASSETS UNDER MANAGEMENT
At June 30, At September 30, At December 31, At March 31, At June 30, Unaudited (Dollars in billions) 2004 2004 2004 2005 2005 - ----------------------------------------------------------------------------------------------------------------------- METLIFE $258.3 $265.0 $270.0 $276.9 $291.9 METLIFE SEPARATE ACCOUNT 79.7 81.2 86.8 85.8 89.5 --------------------------------------------------------------------------- TOTAL ASSETS UNDER MANAGEMENT $338.0 $346.2 $356.8 $362.7 $381.4 ---------------------------------------------------------------------------
42 (METLIFE LOGO) COMPANY RATINGS AS OF JULY 25, 2005 (1)
Moody's Standard & A.M. Best Fitch Investors Service Poor's Company Ratings ------------------ ------------ ------------ ------- FINANCIAL STRENGTH RATINGS First MetLife Investors Insurance Co. NR AA * A+ NR General American Life Insurance Company Aa2 * AA * A+ AA MetLife Investors Insurance Company Aa2 * AA * A+ AA MetLife Investors Insurance Company of California NR AA * A+ NR MetLife Investors USA Insurance Company Aa3 * AA * A+ AA Metropolitan Casualty Insurance Company NR NR A NR Metropolitan Direct Property and Casualty Insurance Co. NR NR A NR Metropolitan General Insurance Company NR NR A NR Metropolitan Group Property & Casualty Insurance Co. NR NR A NR Metropolitan Life Insurance Company Aa2 * AA * A+ AA Metropolitan Life Insurance Company (Short-term rating) P-1 * A-1+ NR NR Metropolitan Lloyds Insurance Company of Texas NR NR A NR Metropolitan Property and Casualty Insurance Company Aa3 * NR A NR Metropolitan Tower Life Insurance Company Aa3 * NR A+ NR New England Life Insurance Company Aa2 * AA * A+ AA Paragon Life Insurance Company NR AA * A+ AA Texas Life Insurance Company NR NR A NR RGA Reinsurance Company A1 AA- * A+ AA- CREDIT RATINGS GenAmerica Capital I Preferred Stock A3 * BBB+ * NR A- General American Life Insurance Company Surplus Notes A1 * A+ * a+ * NR MetLife, Inc. Senior Unsecured A2 * A * a * A Commercial Paper P-1 * A-1 AMB-1 * F1 Subordinated Debt (p) A3 * NR a- * NR Preferred Stock Baa1 * BBB+ * bbb+ * A- Perpetual Preferred Stock Baa1 * BBB * bbb+ * A- MetLife Capital Trust II Preferred Stock A3 * BBB+ * a- * A- MetLife Capital Trust III Preferred Stock A3 * BBB+ * a- * A- MetLife Funding, Inc. Commercial Paper P-1 A-1+ AMB-1+ * F1+ Metropolitan Life Global Funding I Senior Secured Aa2 * AA aa * NR Metropolitan Life Insurance Company Surplus Notes A1 * A+ * a+ * A+ Reinsurance Group of America, Incorporated Senior Unsecured Baa1 A- * a- A- RGA Capital Trust I Preferred Stock Baa2 BBB * bbb+ BBB+
* Moody's, Standard & Poor's and A.M. Best's outlook for these ratings is negative. (1) For entities owned as of June 30, 2005. (P) Preliminary (NR) Not Rated 43 -----END PRIVACY-ENHANCED MESSAGE-----