Investments

12 Months Ended

Dec. 31, 2014

Investments, Debt and Equity Securities [Abstract]

Investments

8. Investments

See Note 10 for information about the fair value hierarchy for investments and the related valuation methodologies.

Investment Risks and Uncertainties

Investments are exposed to the following primary sources of risk: credit, interest rate, liquidity, market valuation, currency and real estate risk. The financial statement risks, stemming from such investment risks, are those associated with the determination of estimated fair values, the diminished ability to sell certain investments in times of strained market conditions, the recognition of impairments, the recognition of income on certain investments and the potential consolidation of VIEs. The use of different methodologies, assumptions and inputs relating to these financial statement risks may have a material effect on the amounts presented within the consolidated financial statements.

The determination of valuation allowances and impairments is highly subjective and is based upon periodic evaluations and assessments of known and inherent risks associated with the respective asset class. Such evaluations and assessments are revised as conditions change and new information becomes available.

The recognition of income on certain investments (e.g. structured securities, including mortgage-backed securities, asset-backed securities (“ABS”), certain structured investment transactions and trading and FVO securities) is dependent upon certain factors such as prepayments and defaults, and changes in such factors could result in changes in amounts to be earned.

Fixed Maturity and Equity Securities AFS

Fixed Maturity and Equity Securities AFS by Sector

The following table presents the fixed maturity and equity securities AFS by sector. Redeemable preferred stock is reported within U.S. corporate and foreign corporate fixed maturity securities and non-redeemable preferred stock is reported within equity securities. Included within fixed maturity securities are structured securities including RMBS, ABS and commercial mortgage-backed securities (“CMBS”).

	December 31, 2014										December 31, 2013
	Cost or Amortized Cost		Gross Unrealized						Estimated Fair Value		Cost or Amortized Cost		Gross Unrealized							Estimated Fair Value
			Gains		Temporary Losses		OTTI Losses						Gains		Temporary Losses		OTTI Losses
									(In millions)
Fixed maturity securities
U.S. corporate	$	59,532	$	6,246	$	421	$	—	$	65,357	$	60,244	$	4,678	$	693	$	—		$	64,229
U.S. Treasury and agency	34,391		4,698		19		—		39,070		29,508		1,730		694		—			30,544
Foreign corporate	28,395		1,934		511		—		29,818		27,082		1,959		285		—			28,756
RMBS	26,893		1,493		157		66		28,163		24,119		1,109		368		150			24,710
ABS (1)	8,206		102		82		—		8,226		7,789		151		117		(1		)	7,824
CMBS	7,705		241		33		—		7,913		8,203		262		89		—			8,376
State and political subdivision	5,329		1,197		6		—		6,520		5,386		467		76		—			5,777
Foreign government	3,153		761		70		—		3,844		3,040		597		107		—			3,530
Total fixed maturity securities	$	173,604	$	16,672	$	1,299	$	66	$	188,911	$	165,371	$	10,953	$	2,429	$	149		$	173,746
Equity securities
Common stock	$	1,236	$	142	$	26	$	—	$	1,352	$	1,070	$	97	$	3	$	—		$	1,164
Non-redeemable preferred stock	690		53		30		—		713		743		62		77		—			728
Total equity securities	$	1,926	$	195	$	56	$	—	$	2,065	$	1,813	$	159	$	80	$	—		$	1,892

______________

(1) The noncredit loss component of OTTI losses was in an unrealized gain position of $1 million for ABS at December 31, 2013, due to increases in estimated fair value subsequent to initial recognition of noncredit losses on such securities. See also “—Net Unrealized Investment Gains (Losses).”

The Company held non-income producing fixed maturity securities with an estimated fair value of $6 million and $38 million with unrealized gains (losses) of $5 million and $12 million at December 31, 2014 and 2013, respectively.

Methodology for Amortization of Premium and Accretion of Discount on Structured Securities

Amortization of premium and accretion of discount on structured securities considers the estimated timing and amount of prepayments of the underlying loans. Actual prepayment experience is periodically reviewed and effective yields are recalculated when differences arise between the originally anticipated and the actual prepayments received and currently anticipated. Prepayment assumptions for single class and multi-class mortgage-backed and ABS are estimated using inputs obtained from third-party specialists and based on management’s knowledge of the current market. For credit-sensitive mortgage-backed and ABS and certain prepayment-sensitive securities, the effective yield is recalculated on a prospective basis. For all other mortgage-backed and ABS, the effective yield is recalculated on a retrospective basis.

Maturities of Fixed Maturity Securities

The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at:

	December 31,
	2014				2013
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
	(In millions)
Due in one year or less	$	5,841	$	5,902	$	6,411	$	6,516
Due after one year through five years	36,600		38,115		34,696		36,556
Due after five years through ten years	39,257		41,519		35,725		38,347
Due after ten years	49,102		59,073		48,428		51,417
Subtotal	130,800		144,609		125,260		132,836
Structured securities (RMBS, ABS and CMBS)	42,804		44,302		40,111		40,910
Total fixed maturity securities	$	173,604	$	188,911	$	165,371	$	173,746

Actual maturities may differ from contractual maturities due to the exercise of call or prepayment options. Fixed maturity securities not due at a single maturity date have been presented in the year of final contractual maturity. RMBS, ABS and CMBS are shown separately, as they are not due at a single maturity.

Continuous Gross Unrealized Losses for Fixed Maturity and Equity Securities AFS by Sector

The following table presents the estimated fair value and gross unrealized losses of fixed maturity and equity securities AFS in an unrealized loss position, aggregated by sector and by length of time that the securities have been in a continuous unrealized loss position.

	December 31, 2014								December 31, 2013
	Less than 12 Months				Equal to or Greater than 12 Months				Less than 12 Months				Equal to or Greater than 12 Months
	Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses
	(In millions, except number of securities)
Fixed maturity securities
U.S. corporate	$	8,950	$	260	$	2,251	$	161	$	8,512	$	426	$	1,948	$	267
U.S. Treasury and agency	3,933		6		982		13		10,077		687		33		7
Foreign corporate	7,052		397		1,165		114		4,217		176		952		109
RMBS	3,141		63		1,900		160		8,194		291		1,675		227
ABS	3,147		45		732		37		1,701		28		530		88
CMBS	772		20		461		13		2,022		74		221		15
State and political subdivision	26		—		76		6		737		44		92		32
Foreign government	327		32		265		38		763		94		54		13
Total fixed maturity securities	$	27,348	$	823	$	7,832	$	542	$	36,223	$	1,820	$	5,505	$	758
Equity securities
Common stock	$	98	$	26	$	1	$	—	$	37	$	3	$	—	$	—
Non-redeemable preferred stock	32		—		139		30		222		41		125		36
Total equity securities	$	130	$	26	$	140	$	30	$	259	$	44	$	125	$	36
Total number of securities in an unrealized loss position	1,997				642				2,211				469

Evaluation of AFS Securities for OTTI and Evaluating Temporarily Impaired AFS Securities

Evaluation and Measurement Methodologies

Management considers a wide range of factors about the security issuer and uses its best judgment in evaluating the cause of the decline in the estimated fair value of the security and in assessing the prospects for near-term recovery. Inherent in management’s evaluation of the security are assumptions and estimates about the operations of the issuer and its future earnings potential. Considerations used in the impairment evaluation process include, but are not limited to: (i) the length of time and the extent to which the estimated fair value has been below cost or amortized cost; (ii) the potential for impairments when the issuer is experiencing significant financial difficulties; (iii) the potential for impairments in an entire industry sector or sub-sector; (iv) the potential for impairments in certain economically depressed geographic locations; (v) the potential for impairments where the issuer, series of issuers or industry has suffered a catastrophic loss or has exhausted natural resources; (vi) with respect to fixed maturity securities, whether the Company has the intent to sell or will more likely than not be required to sell a particular security before the decline in estimated fair value below amortized cost recovers; (vii) with respect to structured securities, changes in forecasted cash flows after considering the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying assets backing a particular security, and the payment priority within the tranche structure of the security; (viii) the potential for impairments due to weakening of foreign currencies on non-functional currency denominated fixed maturity securities that are near maturity; and (ix) other subjective factors, including concentrations and information obtained from regulators and rating agencies.

The methodology and significant inputs used to determine the amount of credit loss on fixed maturity securities are as follows:

• The Company calculates the recovery value by performing a discounted cash flow analysis based on the present value of future cash flows. The discount rate is generally the effective interest rate of the security prior to impairment.

• When determining collectability and the period over which value is expected to recover, the Company applies considerations utilized in its overall impairment evaluation process which incorporates information regarding the specific security, fundamentals of the industry and geographic area in which the security issuer operates, and overall macroeconomic conditions. Projected future cash flows are estimated using assumptions derived from management’s best estimates of likely scenario-based outcomes after giving consideration to a variety of variables that include, but are not limited to: payment terms of the security; the likelihood that the issuer can service the interest and principal payments; the quality and amount of any credit enhancements; the security’s position within the capital structure of the issuer; possible corporate restructurings or asset sales by the issuer; and changes to the rating of the security or the issuer by rating agencies.

• Additional considerations are made when assessing the unique features that apply to certain structured securities including, but not limited to: the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying loans or assets backing a particular security, and the payment priority within the tranche structure of the security.

• When determining the amount of the credit loss for U.S. and foreign corporate securities, foreign government securities and state and political subdivision securities, the estimated fair value is considered the recovery value when available information does not indicate that another value is more appropriate. When information is identified that indicates a recovery value other than estimated fair value, management considers in the determination of recovery value the same considerations utilized in its overall impairment evaluation process as described above, as well as any private and public sector programs to restructure such securities.

With respect to securities that have attributes of debt and equity (perpetual hybrid securities), consideration is given in the OTTI analysis as to whether there has been any deterioration in the credit of the issuer and the likelihood of recovery in value of the securities that are in a severe and extended unrealized loss position. Consideration is also given as to whether any perpetual hybrid securities, with an unrealized loss, regardless of credit rating, have deferred any dividend payments. When an OTTI loss has occurred, the OTTI loss is the entire difference between the perpetual hybrid security’s cost and its estimated fair value with a corresponding charge to earnings.

The cost or amortized cost of fixed maturity and equity securities is adjusted for OTTI in the period in which the determination is made. The Company does not change the revised cost basis for subsequent recoveries in value.

In periods subsequent to the recognition of OTTI on a fixed maturity security, the Company accounts for the impaired security as if it had been purchased on the measurement date of the impairment. Accordingly, the discount (or reduced premium) based on the new cost basis is accreted over the remaining term of the fixed maturity security in a prospective manner based on the amount and timing of estimated future cash flows.

Current Period Evaluation

Based on the Company’s current evaluation of its AFS securities in an unrealized loss position in accordance with its impairment policy, and the Company’s current intentions and assessments (as applicable to the type of security) about holding, selling and any requirements to sell these securities, the Company concluded that these securities were not other-than-temporarily impaired at December 31, 2014. Future OTTI will depend primarily on economic fundamentals, issuer performance (including changes in the present value of future cash flows expected to be collected), and changes in credit ratings, collateral valuation, interest rates and credit spreads. If economic fundamentals deteriorate or if there are adverse changes in the above factors, OTTI may be incurred in upcoming periods.

Gross unrealized losses on fixed maturity securities decreased $1.2 billion during the year ended December 31, 2014 from $2.6 billion to $1.4 billion. The decrease in gross unrealized losses for the year ended December 31, 2014, was primarily attributable to a decrease in interest rates, partially offset by widening credit spreads.

At December 31, 2014, $67 million of the total $1.4 billion of gross unrealized losses were from 27 fixed maturity securities with an unrealized loss position of 20% or more of amortized cost for six months or greater.

Investment Grade Fixed Maturity Securities

Of the $67 million of gross unrealized losses on fixed maturity securities with an unrealized loss of 20% or more of amortized cost for six months or greater, $24 million, or 36%, were related to gross unrealized losses on 12 investment grade fixed maturity securities. Unrealized losses on investment grade fixed maturity securities are principally related to widening credit spreads and, with respect to fixed-rate fixed maturity securities, rising interest rates since purchase.

Below Investment Grade Fixed Maturity Securities

Of the $67 million of gross unrealized losses on fixed maturity securities with an unrealized loss of 20% or more of amortized cost for six months or greater, $43 million, or 64%, were related to gross unrealized losses on 15 below investment grade fixed maturity securities. Unrealized losses on below investment grade fixed maturity securities are principally related to non-agency RMBS (primarily alternative residential mortgage loans) and ABS (primarily foreign ABS) and are the result of significantly wider credit spreads resulting from higher risk premiums since purchase, largely due to economic and market uncertainties including concerns over valuations of residential real estate supporting non-agency RMBS. Management evaluates non-agency RMBS and ABS based on actual and projected cash flows after considering the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying assets backing a particular security, and the payment priority within the tranche structure of the security.

Equity Securities

Gross unrealized losses on equity securities decreased $24 million during the year ended December 31, 2014 from $80 million to $56 million. Of the $56 million, $23 million were from six equity securities with gross unrealized losses of 20% or more of cost for 12 months or greater, all of which were financial services industry investment grade non-redeemable preferred stock, of which 26% were rated A or better.

Mortgage Loans

Mortgage Loans by Portfolio Segment

Mortgage loans are summarized as follows at:

	December 31,
	2014					2013
	Carrying Value			% of Total		Carrying Value			% of Total
	(In millions)					(In millions)
Mortgage loans held-for-investment:
Commercial	$	32,482		66.2	%	$	33,072		71.9	%
Agricultural	11,033			22.5		11,025			24.0
Residential	5,494			11.2		1,858			4.0
Subtotal (1)	49,009			99.9		45,955			99.9
Valuation allowances	(258		)	(0.5	)	(272		)	(0.6	)
Subtotal mortgage loans held-for-investment, net	48,751			99.4		45,683			99.3
Residential — FVO	308			0.6		338			0.7
Total mortgage loans held-for-investment, net	49,059			100.0		46,021			100.0
Mortgage loans held-for-sale	—			—		3			—
Total mortgage loans, net	$	49,059		100.0	%	$	46,024		100.0	%

______________

(1) Purchases of mortgage loans were $4.7 billion and $2.2 billion for the years ended December 31, 2014 and 2013, respectively.

Mortgage Loans, Valuation Allowance and Impaired Loans by Portfolio Segment

Mortgage loans held-for-investment by portfolio segment, by method of evaluation of credit loss, impaired mortgage loans including those modified in a troubled debt restructuring, and the related valuation allowances, were as follows at and for the years ended:

	Evaluated Individually for Credit Losses										Evaluated Collectively for Credit Losses				Impaired Loans
	Impaired Loans with a Valuation Allowance						Impaired Loans without a Valuation Allowance
	Unpaid Principal Balance		Recorded Investment		Valuation Allowances		Unpaid Principal Balance		Recorded Investment		Recorded Investment		Valuation Allowances		Carrying Value		Average Recorded Investment
	(In millions)
December 31, 2014
Commercial	$	75	$	75	$	24	$	84	$	84	$	32,323	$	158	$	135	$	298
Agricultural	47		45		2		14		13		10,975		33		56		76
Residential	—		—		—		40		37		5,457		41		37		17
Total	$	122	$	120	$	26	$	138	$	134	$	48,755	$	232	$	228	$	391
December 31, 2013
Commercial	$	173	$	169	$	49	$	247	$	246	$	32,657	$	164	$	366	$	430
Agricultural	64		62		7		35		34		10,929		33		89		151
Residential	—		—		—		5		4		1,854		19		4		2
Total	$	237	$	231	$	56	$	287	$	284	$	45,440	$	216	$	459	$	583

The average recorded investment for commercial, agricultural and residential mortgage loans was $384 million, $201 million and $0, respectively, for the year ended December 31, 2012.

Valuation Allowance Rollforward by Portfolio Segment

The changes in the valuation allowance, by portfolio segment, were as follows:

	Commercial			Agricultural			Residential			Total
	(In millions)
Balance at January 1, 2012	$	318		$	75		$	—		$	393
Provision (release)	(50		)	2			—			(48		)
Charge-offs, net of recoveries	(12		)	(24		)	—			(36		)
Transfers to held-for-sale	—			(5		)	—			(5		)
Balance at December 31, 2012	256			48			—			304
Provision (release)	(43		)	3			19			(21		)
Charge-offs, net of recoveries	—			(11		)	—			(11		)
Transfers to held-for-sale	—			—			—			—
Balance at December 31, 2013	213			40			19			272
Provision (release)	(8		)	(4		)	27			15
Charge-offs, net of recoveries	(23		)	(1		)	(5		)	(29		)
Transfers to held-for-sale	—			—			—			—
Balance at December 31, 2014	$	182		$	35		$	41		$	258

Valuation Allowance Methodology

Mortgage loans are considered to be impaired when it is probable that, based upon current information and events, the Company will be unable to collect all amounts due under the loan agreement. Specific valuation allowances are established using the same methodology for all three portfolio segments as the excess carrying value of a loan over either (i) the present value of expected future cash flows discounted at the loan’s original effective interest rate, (ii) the estimated fair value of the loan’s underlying collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or (iii) the loan’s observable market price. A common evaluation framework is used for establishing non-specific valuation allowances for all loan portfolio segments; however, a separate non-specific valuation allowance is calculated and maintained for each loan portfolio segment that is based on inputs unique to each loan portfolio segment. Non-specific valuation allowances are established for pools of loans with similar risk characteristics where a property-specific or market-specific risk has not been identified, but for which the Company expects to incur a credit loss. These evaluations are based upon several loan portfolio segment-specific factors, including the Company’s experience for loan losses, defaults and loss severity, and loss expectations for loans with similar risk characteristics. These evaluations are revised as conditions change and new information becomes available.

Commercial and Agricultural Mortgage Loan Portfolio Segments

The Company typically uses several years of historical experience in establishing non-specific valuation allowances which captures multiple economic cycles. For evaluations of commercial mortgage loans, in addition to historical experience, management considers factors that include the impact of a rapid change to the economy, which may not be reflected in the loan portfolio, and recent loss and recovery trend experience as compared to historical loss and recovery experience. For evaluations of agricultural mortgage loans, in addition to historical experience, management considers factors that include increased stress in certain sectors, which may be evidenced by higher delinquency rates, or a change in the number of higher risk loans. On a quarterly basis, management incorporates the impact of these current market events and conditions on historical experience in determining the non-specific valuation allowance established for commercial and agricultural mortgage loans.

All commercial mortgage loans are reviewed on an ongoing basis which may include an analysis of the property financial statements and rent roll, lease rollover analysis, property inspections, market analysis, estimated valuations of the underlying collateral, loan-to-value ratios, debt service coverage ratios, and tenant creditworthiness. The monitoring process focuses on higher risk loans, which include those that are classified as restructured, delinquent or in foreclosure, as well as loans with higher loan-to-value ratios and lower debt service coverage ratios. All agricultural mortgage loans are monitored on an ongoing basis. The monitoring process for agricultural mortgage loans is generally similar to the commercial mortgage loan monitoring process, with a focus on higher risk loans, including reviews on a geographic and property-type basis. Higher risk loans are reviewed individually on an ongoing basis for potential credit loss and specific valuation allowances are established using the methodology described above. Quarterly, the remaining loans are reviewed on a pool basis by aggregating groups of loans that have similar risk characteristics for potential credit loss, and non-specific valuation allowances are established as described above using inputs that are unique to each segment of the loan portfolio.

For commercial mortgage loans, the primary credit quality indicator is the debt service coverage ratio, which compares a property’s net operating income to amounts needed to service the principal and interest due under the loan. Generally, the lower the debt service coverage ratio, the higher the risk of experiencing a credit loss. The Company also reviews the loan-to-value ratio of its commercial mortgage loan portfolio. Loan-to-value ratios compare the unpaid principal balance of the loan to the estimated fair value of the underlying collateral. Generally, the higher the loan-to-value ratio, the higher the risk of experiencing a credit loss. The debt service coverage ratio and loan-to-value ratio, as well as the values utilized in calculating these ratios, are updated annually, on a rolling basis, with a portion of the loan portfolio updated each quarter.

For agricultural mortgage loans, the Company’s primary credit quality indicator is the loan-to-value ratio. The values utilized in calculating this ratio are developed in connection with the ongoing review of the agricultural mortgage loan portfolio and are routinely updated.

Residential Mortgage Loan Portfolio Segment

The Company’s residential mortgage loan portfolio is comprised primarily of closed end, amortizing residential mortgage loans. For evaluations of residential mortgage loans, the key inputs of expected frequency and expected loss reflect current market conditions, with expected frequency adjusted, when appropriate, for differences from market conditions and the Company’s historical experience. In contrast to the commercial and agricultural mortgage loan portfolios, residential mortgage loans are smaller-balance homogeneous loans that are collectively evaluated for impairment. Non-specific valuation allowances are established using the evaluation framework described above for pools of loans with similar risk characteristics from inputs that are unique to the residential segment of the loan portfolio. Loan specific valuation allowances are only established on residential mortgage loans when they have been restructured and are established using the methodology described above for all loan portfolio segments.

For residential mortgage loans, the Company’s primary credit quality indicator is whether the loan is performing or nonperforming. The Company generally defines nonperforming residential mortgage loans as those that are 60 or more days past due and/or in non-accrual status which is assessed monthly. Generally, nonperforming residential mortgage loans have a higher risk of experiencing a credit loss.

Credit Quality of Commercial Mortgage Loans

The credit quality of commercial mortgage loans held-for-investment, were as follows at:

	Recorded Investment										Estimated Fair Value		% of Total
	Debt Service Coverage Ratios						Total		% of  Total
	> 1.20x		1.00x - 1.20x		< 1.00x
	(In millions)										(In millions)
December 31, 2014
Loan-to-value ratios:
Less than 65%	$	26,810	$	746	$	761	$	28,317	87.2	%	$	29,860	87.7	%
65% to 75%	2,783		391		86		3,260		10.0		3,322		9.8
76% to 80%	109		—		8		117		0.4		121		0.3
Greater than 80%	384		256		148		788		2.4		736		2.2
Total	$	30,086	$	1,393	$	1,003	$	32,482	100.0	%	$	34,039	100.0	%
December 31, 2013
Loan-to-value ratios:
Less than 65%	$	24,585	$	476	$	596	$	25,657	77.6	%	$	26,900	78.4	%
65% to 75%	5,219		438		104		5,761		17.4		5,852		17.1
76% to 80%	444		157		189		790		2.4		776		2.3
Greater than 80%	583		205		76		864		2.6		769		2.2
Total	$	30,831	$	1,276	$	965	$	33,072	100.0	%	$	34,297	100.0	%

Credit Quality of Agricultural Mortgage Loans

The credit quality of agricultural mortgage loans held-for-investment were as follows at:

	December 31,
	2014				2013
	Recorded Investment		% of Total		Recorded Investment		% of Total
	(In millions)				(In millions)
Loan-to-value ratios:
Less than 65%	$	10,462	94.8	%	$	10,165	92.2	%
65% to 75%	469		4.2		659		6.0
76% to 80%	17		0.2		84		0.8
Greater than 80%	85		0.8		117		1.0
Total	$	11,033	100.0	%	$	11,025	100.0	%

The estimated fair value of agricultural mortgage loans held-for-investment was $11.4 billion and $11.3 billion at December 31, 2014 and 2013, respectively.

Credit Quality of Residential Mortgage Loans

The credit quality of residential mortgage loans held-for-investment were as follows at:

	December 31,
	2014				2013
	Recorded Investment		% of Total		Recorded Investment		% of Total
	(In millions)				(In millions)
Performance indicators:
Performing	$	5,345	97.3	%	$	1,812	97.5	%
Nonperforming	149		2.7		46		2.5
Total	$	5,494	100.0	%	$	1,858	100.0	%

The estimated fair value of residential mortgage loans held-for-investment was $5.6 billion and $1.8 billion at December 31, 2014 and 2013, respectively.

Past Due and Interest Accrual Status of Mortgage Loans

The Company has a high quality, well performing mortgage loan portfolio, with 99% of all mortgage loans classified as performing at both December 31, 2014 and 2013. The Company defines delinquency consistent with industry practice, when mortgage loans are past due as follows: commercial and residential mortgage loans — 60 days and agricultural mortgage loans — 90 days. The past due and accrual status of mortgage loans at recorded investment, prior to valuation allowances, by portfolio segment, were as follows at:

	Past Due				Nonaccrual Status
	December 31, 2014		December 31, 2013		December 31, 2014		December 31, 2013
	(In millions)
Commercial	$	—	$	—	$	75	$	169
Agricultural	1		44		41		47
Residential	149		46		149		46
Total	$	150	$	90	$	265	$	262

Mortgage Loans Modified in a Troubled Debt Restructuring

For a small portion of the mortgage loan portfolio, classified as troubled debt restructurings, concessions are granted related to borrowers experiencing financial difficulties. Generally, the types of concessions include: reduction of the contractual interest rate, extension of the maturity date at an interest rate lower than current market interest rates, and/or a reduction of accrued interest. The amount, timing and extent of the concession granted is considered in determining any impairment or changes in the specific valuation allowance. During the years ended December 31, 2014 and 2013, the Company did not have a significant amount of mortgage loans modified in a troubled debt restructuring.

Other Invested Assets

Other invested assets is comprised primarily of freestanding derivatives with positive estimated fair values (see Note 9), tax credit and renewable energy partnerships, loans to affiliates (see “— Related Party Investment Transactions”) and leveraged and direct financing leases.

Leveraged and Direct Financing Leases

Investment in leveraged and direct financing leases consisted of the following at:

	December 31,
	2014						2013
	Leveraged Leases			Direct Financing Leases			Leveraged Leases			Direct Financing Leases
	(In millions)
Rental receivables, net	$	1,320		$	406		$	1,393		$	413
Estimated residual values	827			57			853			52
Subtotal	2,147			463			2,246			465
Unearned income	(686		)	(178		)	(742		)	(177		)
Investment in leases, net of non-recourse debt	$	1,461		$	285		$	1,504		$	288

Rental receivables are generally due in periodic installments. The payment periods for leveraged leases range from one to 15 years but in certain circumstances can be over 30 years, while the payment periods for direct financing leases range from one to 22 years. For rental receivables, the primary credit quality indicator is whether the rental receivable is performing or nonperforming, which is assessed monthly. The Company generally defines nonperforming rental receivables as those that are 90 days or more past due. At December 31, 2014 and 2013, all leveraged lease receivables and direct financing rental receivables were performing.

The deferred income tax liability related to leveraged leases was $1.3 billion and $1.4 billion at December 31, 2014 and 2013, respectively.

The components of income from investments in leveraged and direct financing leases, excluding net investment gains (losses), were as follows:

	Years Ended December 31,
	2014				2013				2012
	Leveraged Leases		Direct Financing Leases		Leveraged Leases		Direct Financing Leases		Leveraged Leases		Direct Financing Leases
	(In millions)
Income from investment in leases	$	51	$	19	$	60	$	17	$	34	$	15
Less: Income tax expense on leases	18		7		21		6		12		5
Investment income after income tax	$	33	$	12	$	39	$	11	$	22	$	10

Cash Equivalents

The carrying value of cash equivalents, which includes securities and other investments with an original or remaining maturity of three months or less at the time of purchase, was $1.0 billion and $790 million at December 31, 2014 and 2013, respectively.

Net Unrealized Investment Gains (Losses)

Unrealized investment gains (losses) on fixed maturity and equity securities AFS and the effect on DAC, VOBA, DSI, future policy benefits and the policyholder dividend obligation, that would result from the realization of the unrealized gains (losses), are included in net unrealized investment gains (losses) in AOCI.

The components of net unrealized investment gains (losses), included in AOCI, were as follows:

	Years Ended December 31,
	2014			2013			2012
	(In millions)
Fixed maturity securities	$	15,374		$	8,521		$	19,120
Fixed maturity securities with noncredit OTTI losses in AOCI	(66		)	(149		)	(256		)
Total fixed maturity securities	15,308			8,372			18,864
Equity securities	173			83			(13		)
Derivatives	1,649			361			1,052
Short-term investments	—			—			(2		)
Other	87			5			18
Subtotal	17,217			8,821			19,919
Amounts allocated from:
Future policy benefits	(1,964		)	(610		)	(5,120		)
DAC and VOBA related to noncredit OTTI losses recognized in AOCI	(3		)	5			12
DAC, VOBA and DSI	(918		)	(721		)	(1,231		)
Policyholder dividend obligation	(3,155		)	(1,771		)	(3,828		)
Subtotal	(6,040		)	(3,097		)	(10,167		)
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI	25			51			86
Deferred income tax benefit (expense)	(3,928		)	(2,070		)	(3,498		)
Net unrealized investment gains (losses)	7,274			3,705			6,340
Net unrealized investment gains (losses) attributable to noncontrolling interests	(1		)	(1		)	(1		)
Net unrealized investment gains (losses) attributable to Metropolitan Life Insurance Company	$	7,273		$	3,704		$	6,339

The changes in fixed maturity securities with noncredit OTTI losses included in AOCI were as follows:

	Years Ended December 31,
	2014			2013
	(In millions)
Balance at January 1,	$	(149	)	$	(256	)
Noncredit OTTI losses and subsequent changes recognized	10			47
Securities sold with previous noncredit OTTI loss	41			114
Subsequent changes in estimated fair value	32			(54		)
Balance at December 31,	$	(66	)	$	(149	)

The changes in net unrealized investment gains (losses) were as follows:

	Years Ended December 31,
	2014			2013			2012
	(In millions)
Balance at January 1,	$	3,704		$	6,339		$	4,868
Fixed maturity securities on which noncredit OTTI losses have been recognized	83			107			266
Unrealized investment gains (losses) during the year	8,313			(11,205		)	4,679
Unrealized investment gains (losses) relating to:
Future policy benefits	(1,354		)	4,510			(1,625		)
DAC and VOBA related to noncredit OTTI losses recognized in AOCI	(8		)	(7		)	(21		)
DAC, VOBA and DSI	(197		)	510			(129		)
Policyholder dividend obligation	(1,384		)	2,057			(909		)
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI	(26		)	(35		)	(86		)
Deferred income tax benefit (expense)	(1,858		)	1,428			(704		)
Net unrealized investment gains (losses)	7,273			3,704			6,339
Net unrealized investment gains (losses) attributable to noncontrolling interests	—			—			—
Balance at December 31,	$	7,273		$	3,704		$	6,339
Change in net unrealized investment gains (losses)	$	3,569		$	(2,635	)	$	1,471
Change in net unrealized investment gains (losses) attributable to noncontrolling interests	—			—			—
Change in net unrealized investment gains (losses) attributable to Metropolitan Life Insurance Company	$	3,569		$	(2,635	)	$	1,471

Concentrations of Credit Risk

There were no investments in any counterparty that were greater than 10% of the Company’s equity, other than the U.S. government and its agencies, at both December 31, 2014 and 2013.

Securities Lending

Elements of the securities lending program are presented below at:

	December 31,
	2014		2013
	(In millions)
Securities on loan: (1)
Amortized cost	$	19,099	$	18,829
Estimated fair value	$	21,185	$	19,153
Cash collateral on deposit from counterparties (2)	$	21,635	$	19,673
Security collateral on deposit from counterparties (3)	$	19	$	—
Reinvestment portfolio — estimated fair value	$	22,046	$	19,822

______________

(1) Included within fixed maturity securities, short-term investments and equity securities.

(2) Included within payables for collateral under securities loaned and other transactions.

(3) Security collateral on deposit from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reflected in the consolidated financial statements.

Invested Assets on Deposit and Pledged as Collateral

Invested assets on deposit and pledged as collateral are presented below at estimated fair value for all asset classes, except mortgage loans, which are presented at carrying value at:

	December 31,
	2014		2013
	(In millions)
Invested assets on deposit (regulatory deposits)	$	1,421	$	1,338
Invested assets pledged as collateral (1)	20,712		19,555
Total invested assets on deposit and pledged as collateral	$	22,133	$	20,893

______________

(1) The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements (see Note 4), and derivative transactions (see Note 9).

See “— Securities Lending” for information regarding securities on loan and Note 7 for information regarding investments designated to the closed block.

Purchased Credit Impaired Investments

Investments acquired with evidence of credit quality deterioration since origination and for which it is probable at the acquisition date that the Company will be unable to collect all contractually required payments are classified as purchased credit impaired (“PCI”) investments. For each investment, the excess of the cash flows expected to be collected as of the acquisition date over its acquisition date fair value is referred to as the accretable yield and is recognized as net investment income on an effective yield basis. If subsequently, based on current information and events, it is probable that there is a significant increase in cash flows previously expected to be collected or if actual cash flows are significantly greater than cash flows previously expected to be collected, the accretable yield is adjusted prospectively. The excess of the contractually required payments (including interest) as of the acquisition date over the cash flows expected to be collected as of the acquisition date is referred to as the nonaccretable difference, and this amount is not expected to be realized as net investment income. Decreases in cash flows expected to be collected can result in OTTI.

The Company’s PCI fixed maturity securities were as follows at:

	December 31,
	2014		2013
	(In millions)
Outstanding principal and interest balance (1)	$	4,614	$	4,653
Carrying value (2)	$	3,651	$	3,601

______________

(1) Represents the contractually required payments, which is the sum of contractual principal, whether or not currently due, and accrued interest.

(2) Estimated fair value plus accrued interest.

The following table presents information about PCI fixed maturity securities acquired during the periods indicated:

	Years Ended December 31,
	2014		2013
	(In millions)
Contractually required payments (including interest)	$	820	$	1,612
Cash flows expected to be collected (1)	$	644	$	1,248
Fair value of investments acquired	$	433	$	841

______________

(1) Represents undiscounted principal and interest cash flow expectations, at the date of acquisition.

The following table presents activity for the accretable yield on PCI fixed maturity securities for:

	Years Ended December 31,
	2014			2013
	(In millions)
Accretable yield, January 1,	$	2,431		$	2,357
Investments purchased	211			407
Accretion recognized in earnings	(217		)	(236		)
Disposals	(47		)	(144		)
Reclassification (to) from nonaccretable difference	(495		)	47
Accretable yield, December 31,	$	1,883		$	2,431

Collectively Significant Equity Method Investments

The Company holds investments in real estate joint ventures, real estate funds and other limited partnership interests consisting of leveraged buy-out funds, hedge funds, private equity funds, joint ventures and other funds. The portion of these investments accounted for under the equity method had a carrying value of $9.9 billion at December 31, 2014. The Company’s maximum exposure to loss related to these equity method investments is limited to the carrying value of these investments plus unfunded commitments of $2.7 billion at December 31, 2014. Except for certain real estate joint ventures, the Company’s investments in real estate funds and other limited partnership interests are generally of a passive nature in that the Company does not participate in the management of the entities.

As described in Note 1, the Company generally records its share of earnings in its equity method investments using a three-month lag methodology and within net investment income. Aggregate net investment income from these equity method investments exceeded 10% of the Company’s consolidated pre-tax income (loss) from continuing operations for one of the three most recent annual periods: 2013. The Company is providing the following aggregated summarized financial data for such equity method investments, for the most recent annual periods, in order to provide comparative information. This aggregated summarized financial data does not represent the Company’s proportionate share of the assets, liabilities, or earnings of such entities.

The aggregated summarized financial data presented below reflects the latest available financial information and is as of, and for, the years ended December 31, 2014, 2013 and 2012. Aggregate total assets of these entities totaled $351.0 billion and $280.7 billion at December 31, 2014 and 2013, respectively. Aggregate total liabilities of these entities totaled $32.1 billion and $23.5 billion at December 31, 2014 and 2013, respectively. Aggregate net income (loss) of these entities totaled $33.7 billion, $25.0 billion and $16.5 billion for the years ended December 31, 2014, 2013 and 2012, respectively. Aggregate net income (loss) from the underlying entities in which the Company invests is primarily comprised of investment income, including recurring investment income and realized and unrealized investment gains (losses).

Variable Interest Entities

The Company has invested in certain structured transactions (including consolidated securitization entities (“CSEs”)) that are VIEs. In certain instances, the Company holds both the power to direct the most significant activities of the entity, as well as an economic interest in the entity and, as such, is deemed to be the primary beneficiary or consolidator of the entity.

The determination of the VIE’s primary beneficiary requires an evaluation of the contractual and implied rights and obligations associated with each party’s relationship with or involvement in the entity, an estimate of the entity’s expected losses and expected residual returns and the allocation of such estimates to each party involved in the entity. The Company generally uses a qualitative approach to determine whether it is the primary beneficiary. However, for VIEs that are investment companies or apply measurement principles consistent with those utilized by investment companies, the primary beneficiary is based on a risks and rewards model and is defined as the entity that will absorb a majority of a VIE’s expected losses, receive a majority of a VIE’s expected residual returns if no single entity absorbs a majority of expected losses, or both. The Company reassesses its involvement with VIEs on a quarterly basis. The use of different methodologies, assumptions and inputs in the determination of the primary beneficiary could have a material effect on the amounts presented within the consolidated financial statements.

Consolidated VIEs

The following table presents the total assets and total liabilities relating to VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated at December 31, 2014 and 2013. Creditors or beneficial interest holders of VIEs where the Company is the primary beneficiary have no recourse to the general credit of the Company, as the Company’s obligation to the VIEs is limited to the amount of its committed investment.

	December 31,
	2014				2013
	Total Assets		Total Liabilities		Total Assets		Total Liabilities
	(In millions)
Fixed maturity securities (1)	$	163	$	78	$	159	$	80
Other invested assets	59		—		82		7
Other limited partnership interests	37		—		61		—
CSEs (assets (primarily securities) and liabilities (primarily debt)) (2)	16		15		23		22
Real estate joint ventures (3)	9		15		1,181		443
Total	$	284	$	108	$	1,506	$	552

______________

(1) The Company consolidates certain fixed maturity securities purchased in an investment vehicle which was partially funded with affiliated long-term debt. The long-term debt bears interest primarily at variable rates, payable on a bi-annual basis. Interest expense related to these obligations, included in other expenses, was $2 million for both the years ended December 31, 2014 and 2013 and was $1 million for the year ended December 31, 2012.

(2) The Company consolidates entities that are structured as collateralized debt obligations. The assets of these entities can only be used to settle their respective liabilities, and under no circumstances is the Company liable for any principal or interest shortfalls should any arise. The Company’s exposure was limited to that of its remaining investment in these entities of less than $1 million at estimated fair value at both December 31, 2014 and 2013. The long-term debt bears interest primarily at variable rates, payable on a bi-annual basis. Interest expense related to these obligations, included in other expenses, was $1 million, $3 million and $4 million for the years ended December 31, 2014, 2013 and 2012, respectively.

(3) At December 31, 2013, the Company consolidated an open ended core real estate fund formed in the fourth quarter of 2013 (the “MetLife Core Property Fund”), which represented the majority of the balances at December 31, 2013. As a result of the quarterly reassessment in the first quarter of 2014, the Company no longer consolidated the MetLife Core Property Fund, effective March 31, 2014, based on the terms of the revised partnership agreement. The Company accounts for its retained interest in the real estate fund under the equity method. Assets of the real estate fund are a real estate investment trust which holds primarily traditional core income-producing real estate which has associated liabilities that are primarily non-recourse debt secured by certain real estate assets of the fund. The assets of these entities can only be used to settle their respective liabilities, and under no circumstances is the Company liable for any principal or interest shortfalls should any arise. The Company’s exposure was limited to that of its investment in the real estate fund of $178 million at carrying value at December 31, 2013. The long-term debt bears interest primarily at fixed rates ranging from 1.39% to 4.45%, payable primarily on a monthly basis. Interest expense related to these obligations, included in other expenses, was less than $1 million for the year ended December 31, 2013.

Unconsolidated VIEs

The carrying amount and maximum exposure to loss relating to VIEs in which the Company holds a significant variable interest but is not the primary beneficiary and which have not been consolidated were as follows at:

	December 31,
	2014				2013
	Carrying Amount		Maximum Exposure to Loss (1)		Carrying Amount		Maximum Exposure to Loss (1)
	(In millions)
Fixed maturity securities AFS:
Structured securities (RMBS, ABS and CMBS) (2)	$	44,302	$	44,302	$	40,910	$	40,910
U.S. and foreign corporate	1,919		1,919		2,251		2,251
Other limited partnership interests	3,722		4,833		3,168		4,273
Other invested assets	1,683		2,003		1,498		1,852
Real estate joint ventures	52		74		31		31
Total	$	51,678	$	53,131	$	47,858	$	49,317

______________

(1) The maximum exposure to loss relating to fixed maturity securities AFS is equal to their carrying amounts or the carrying amounts of retained interests. The maximum exposure to loss relating to other limited partnership interests and real estate joint ventures is equal to the carrying amounts plus any unfunded commitments of the Company. For certain of its investments in other invested assets, the Company’s return is in the form of income tax credits which are guaranteed by creditworthy third parties. For such investments, the maximum exposure to loss is equal to the carrying amounts plus any unfunded commitments, reduced by income tax credits guaranteed by third parties of $212 million and $257 million at December 31, 2014 and 2013, respectively. Such a maximum loss would be expected to occur only upon bankruptcy of the issuer or investee.

(2) For these variable interests, the Company’s involvement is limited to that of a passive investor in mortgage-backed or asset-backed securities issued by trusts that do not have substantial equity.

As described in Note 17, the Company makes commitments to fund partnership investments in the normal course of business. Excluding these commitments, the Company did not provide financial or other support to investees designated as VIEs during the years ended December 31, 2014, 2013 and 2012.

Net Investment Income

The components of net investment income were as follows:

	Years Ended December 31,
	2014		2013			2012
	(In millions)
Investment income:
Fixed maturity securities	$	8,260	$	8,279		$	8,295
Equity securities	86		78			68
Trading and FVO securities - Actively Traded and FVO general account securities (1)	23		43			77
Mortgage loans	2,378		2,405			2,528
Policy loans	448		440			451
Real estate and real estate joint ventures	725		699			593
Other limited partnership interests	721		633			555
Cash, cash equivalents and short-term investments	26		32			19
Operating joint ventures	2		(4		)	(2		)
Other	61		21			7
Subtotal	12,730		12,626			12,591
Less: Investment expenses	838		844			743
Subtotal, net	11,892		11,782			11,848
FVO CSEs - interest income:
Securities	1		3			4
Subtotal	1		3			4
Net investment income	$	11,893	$	11,785		$	11,852

______________

(1) Changes in estimated fair value subsequent to purchase for securities still held as of the end of the respective years included in net investment income were ($14) million, $4 million and $44 million for the years ended December 31, 2014, 2013 and 2012, respectively.

See “— Variable Interest Entities” for discussion of CSEs.

See “— Related Party Investment Transactions” for discussion of affiliated net investment income and investment expenses.

Net Investment Gains (Losses)

Components of Net Investment Gains (Losses)

The components of net investment gains (losses) were as follows:

	Years Ended December 31,
	2014			2013			2012
	(In millions)
Total gains (losses) on fixed maturity securities:
Total OTTI losses recognized — by sector and industry:
U.S. and foreign corporate securities — by industry:
Consumer	$	(6	)	$	(12	)	$	(19	)
Utility	—			(48		)	(29		)
Finance	—			(4		)	(21		)
Communications	—			(2		)	(18		)
Industrial	—			—			(4		)
Transportation	—			—			(1		)
Total U.S. and foreign corporate securities	(6		)	(66		)	(92		)
RMBS	(20		)	(62		)	(70		)
CMBS	—			—			(28		)
ABS	—			—			(2		)
OTTI losses on fixed maturity securities recognized in earnings	(26		)	(128		)	(192		)
Fixed maturity securities — net gains (losses) on sales and disposals	(99		)	177			16
Total gains (losses) on fixed maturity securities	(125		)	49			(176		)
Total gains (losses) on equity securities:
Total OTTI losses recognized — by sector:
Non-redeemable preferred stock	(16		)	(17		)	—
Common stock	(5		)	(2		)	(7		)
OTTI losses on equity securities recognized in earnings	(21		)	(19		)	(7		)
Equity securities — net gains (losses) on sales and disposals	42			6			15
Total gains (losses) on equity securities	21			(13		)	8
Trading and FVO securities — FVO general account securities	1			11			11
Mortgage loans	(36		)	31			84
Real estate and real estate joint ventures	252			(15		)	(27		)
Other limited partnership interests	(69		)	(41		)	(35		)
Other investment portfolio gains (losses)	(108		)	5			(192		)
Subtotal — investment portfolio gains (losses)	(64		)	27			(327		)
FVO CSEs:
Securities	—			2			—
Long-term debt — related to securities	(1		)	(2		)	(7		)
Non-investment portfolio gains (losses)	208			21			4
Subtotal FVO CSEs and non-investment portfolio gains (losses)	207			21			(3		)
Total net investment gains (losses)	$	143		$	48		$	(330	)

______________

See “— Variable Interest Entities” for discussion of CSEs.

See “— Related Party Investment Transactions” for discussion of affiliated net investment gains (losses) related to transfers of invested assets to affiliates.

Gains (losses) from foreign currency transactions included within net investment gains (losses) were $132 million, less than $1 million and $2 million for the years ended December 31, 2014, 2013 and 2012, respectively.

Sales or Disposals and Impairments of Fixed Maturity and Equity Securities

Proceeds from sales or disposals of fixed maturity and equity securities and the components of fixed maturity and equity securities net investment gains (losses) are as shown in the table below. Investment gains and losses on sales of securities are determined on a specific identification basis.

	Years Ended December 31,
	2014			2013			2012			2014			2013			2012
	Fixed Maturity Securities									Equity Securities
	(In millions)
Proceeds	$	44,906		$	45,538		$	29,472		$	128		$	144		$	126
Gross investment gains	$	260		$	556		$	327		$	46		$	25		$	23
Gross investment losses	(359		)	(379		)	(311		)	(4		)	(19		)	(8		)
OTTI losses (1)	(26		)	(128		)	(192		)	(21		)	(19		)	(7		)
Net investment gains (losses)	$	(125	)	$	49		$	(176	)	$	21		$	(13	)	$	8

______________

(1) OTTI losses recognized in earnings include noncredit-related impairment losses of $0, $13 million and $67 million for the years ended December 31, 2014, 2013 and 2012, respectively, on (i) perpetual hybrid securities classified within fixed maturity securities where the primary reason for the impairment was the severity and/or the duration of an unrealized loss position, and (ii) fixed maturity securities where there is an intent to sell or it is more likely than not that the Company will be required to sell the security before recovery of the decline in estimated fair value.

Credit Loss Rollforward

The table below presents a rollforward of the cumulative credit loss component of OTTI loss recognized in earnings on fixed maturity securities still held for which a portion of the OTTI loss was recognized in OCI:

	Years Ended December 31,
	2014			2013
	(In millions)
Balance at January 1,	$	277		$	285
Additions:
Initial impairments — credit loss OTTI recognized on securities not previously impaired	1			4
Additional impairments — credit loss OTTI recognized on securities previously impaired	15			54
Reductions:
Sales (maturities, pay downs or prepayments) of securities previously impaired as credit loss OTTI	(30		)	(65		)
Securities impaired to net present value of expected future cash flows	—			—
Increases in cash flows — accretion of previous credit loss OTTI	—			(1		)
Balance at December 31,	$	263		$	277

Related Party Investment Transactions

The Company transfers invested assets, primarily consisting of fixed maturity securities, to and from affiliates. Invested assets transferred to and from affiliates were as follows:

	Years Ended December 31,
	2014		2013		2012
	(In millions)
Estimated fair value of invested assets transferred to affiliates	$	97	$	781	$	4
Amortized cost of invested assets transferred to affiliates	$	89	$	688	$	4
Net investment gains (losses) recognized on transfers	$	8	$	93	$	—
Estimated fair value of invested assets transferred from affiliates	$	882	$	882	$	—

Prior to the Mergers, certain related party investment transactions were consummated as summarized below.  See Note 6 for additional information on the Mergers.

• The Company had a loan outstanding to Exeter, an affiliate, totaling $75 million at December 31, 2013, which was included in other invested assets. MetLife USA assumed the loan upon the consummation of the Mergers in November 2014 and, subsequently, the loan matured on December 30, 2014. Net investment income from this loan was $5 million for each of the years ended December 31, 2014, 2013 and 2012.

• In July 2014, the Company purchased from other affiliates additional affiliated loans (having an unpaid principal balance of $400 million) at estimated fair value of $437 million, which are included in other invested assets and in the table above. The unpaid principal balances on these acquired loans, which bear interest at fixed rates payable semiannually are due as follows: $295 million due July 15, 2021 at 5.64% and $105 million due December 16, 2021 at 5.86%.

• In 2013, Metropolitan Life Insurance Company transferred invested assets to and from MICC of $751 million and $739 million, respectively, related to the establishment of a custodial account to secure certain policyholder liabilities, which is included in the table above.

In December 2014, American Life Insurance Company, an affiliate, issued a surplus note to the Company, which was included in other invested assets, totaling $100 million. The loan, which bears interest at a fixed rate of 3.17%, payable semiannually, is due on June 30, 2020.

The Company has affiliated loans outstanding to MetLife, Inc., which are included in other invested assets, totaling $2.0 billion and $1.5 billion  at December 31, 2014 and 2013, respectively. The loans, which bear interest at a fixed rate, payable semiannually are due as follows: $500 million  at 3.54% due on June 30, 2019, $250 million  at 3.57% due on October 1, 2019, $250 million  at 7.44% due on September 30, 2016, $150 million  at 5.64% due July 15, 2021 and $375 million  at 5.86% due December 16, 2021. Net investment income from these affiliated loans, and the $400 million of affiliated loans acquired in July 2014 described above, was $92 million, $90 million and $93 million for the years ended December 31, 2014, 2013 and 2012, respectively.

The Company purchased from MetLife Bank, National Association, $1.5 billion and $1.3 billion of fixed maturity securities and mortgage loans, respectively, at estimated fair value, for cash during the year ended December 31, 2012.

The Company provides investment administrative services to certain affiliates. The related investment administrative service charges to these affiliates were $179 million, $172 million and $158 million for the years ended December 31, 2014, 2013 and 2012, respectively. The Company also earned additional affiliated net investment income of $4 million for each of the years ended December 31, 2014, 2013 and 2012.