Metlife, Inc. · NYSE:MET
Metlife — Investor Day (December 2019)
136 slides from Metlife's investor day presentation, Dec 12, 2019
Slide 1: Introduction
Introduction John Hall Senior Vice President, Global Head of Investor Relations Exhibit 99.1
Slide 2: Agenda for today
Agenda for today Michel Khalaf President and Chief Executive Officer Next Horizon Strategy Group Benefits Ramy Tadros President, U.S. Business Todd Katz Executive Vice President, Group Benefits Esther Lee Executive Vice President, Global Chief Marketing Officer Retirement and Income Solutions Ramy T
Slide 3: Our future
] wee "Our future \
Slide 4: Next Horizon Strategy
Next Horizon Strategy Michel Khalaf President and Chief Executive Officer
Slide 5: Always with you, building a more confident future
Always with you, building a more confident future. Our People Our Customers Our Shareholders
Slide 6: Key Messages
Key Messages Embarking on our Next Horizon Strategy from a position of strength Three strategic pillars: Focus, Simplify, Differentiate Driving value from our globally diversified, market-leading businesses Accretive Returns Deliver 12–14% Adjusted ROE1 Strong Free Cash Flow Generate ~$20B of distri
Slide 7: Embarking on our Next Horizon from a position of strength
Embarking on our Next Horizon from a position of strength Improved core operations since 2016 Improved asset and liability risk profile Built balance sheet resilience Increased liquidity and capital resilience Spun-off U.S. Retail Business Returned ~$15.7B1 in dividends and buybacks Improved Adjuste
Slide 8: Delivering attractive returns while driving down our cost of capital
2.9% 1 Excluding total notable items and AOCI other than FCTA. 2 One to three years. 3 Average U.S. 10 Year Treasury yield. 4 Source: Thomson Reuters. Beta 5 years. 5 Peers include: Allianz, Allstate, Aflac, AIG, AXA, Chubb, Daiichi, Globe Life, Hartford, Legal & General, Lincoln, Manulife, MetLife,
Slide 9: Improving our risk profile
Improving our risk profile… Variable Annuity (VA) Account Balances1 ($ in billions) Group Benefits Adjusted Earnings ($ in millions) -69% +99% 1 Represents MetLife Holdings and former U.S. retail segment.
Slide 10: … and our business mix
… and our business mix Group, Accident & Health (A&H) and Fee Adjusted Earnings1 Investment / Spread Long-term Protection3 Property & Casualty Group, A&H and Fee Value of New Business2 Investment / Spread Long-term Protection3 Property & Casualty 1 3Q19 YTD. Excluding Corporate & Other and total not
Slide 11: Delivering outstanding VNB growth
1 Excludes MetLife Holdings; Value of New Business is the present value of future profits net the cost of capital and time value of guarantees from new sales. Delivering outstanding VNB growth Value of New Business1 Capital Deployed $2.9B $3.1B $3.8B IRR 14% 14% 15% Payback 7 Years 7 Years 7 Years C
Slide 12: Focus, Simplify, Differentiate to drive superior value
Focus, Simplify, Differentiate to drive superior value Focus Generate strong free cash flow by deploying capital and resources to the highest value opportunities Simplify Simplify our business to deliver operational efficiency and an outstanding customer experience Differentiate Drive competitive ad
Slide 13: Generating strong and sustainable free cash flow
Generating strong and sustainable free cash flow Disciplined assessment of capital deployment opportunities Our Capital Management Philosophy Maintain a 65%-75% free cash flow ratio1 Our Commitments 1 Ratio of adjusted earnings. Maintain strong liquidity and capital position Excess capital belongs t
Slide 14: Operating leverage creates $1B+ additional capacity
1 As of September 30, 2019. 2 Excludes lower employee benefit costs related to market movements; 12.2% including such costs. 3 Excluding total notable items related to direct expenses and PRT. Operating leverage creates $1B+ additional capacity to accelerate growth over 5 years Shift from serial exp
Slide 15: Continue to differentiate and build on our competitive advantages
Continue to differentiate and build on our competitive advantages World-Class Talent Iconic Brand Technology & Innovation Scale
Slide 16: Diversified portfolio of global businesses
Diversified portfolio of global businesses Globally diversified covering 80% of world GWP Complementary mix of mature and high-growth markets Recognized and trusted by ~100M customers worldwide Serving 90+ of Fortune 100 companies in the U.S. Highlights Latin America: 9% U.S.: 64% Asia: 22% EMEA: 5%
Slide 17: Complementary portfolio of businesses to generate sustained free cash flow
Complementary portfolio of businesses to generate sustained free cash flow Well-positioned in secular growth markets2 Steady sources of cash in mature markets Growth drivers from market leaders2 Group #1 Chile #1 Mexico #1 Holdings RIS Japan China India Brazil Bangladesh Turkey #2 #1 #3 ~50% of MetL
Slide 18: Our Next Horizon
Our Next Horizon Simpler & More Focused Great Set of Businesses Strong Free Cash Flow
Slide 19: Group Benefits
Group Benefits Ramy Tadros President, U.S. Business
Slide 20: Key Messages
Key Messages Market leader in a highly attractive business Positioned to win in a rapidly evolving marketplace Product mix and pricing drives resilience across economic cycles Focused strategies to outpace market top and bottom line growth
Slide 21: Diverse product set and market mix enables balanced growth
Diverse product set and market mix enables balanced growth Adjusted PFO by Product1 Adjusted PFO by Market1 Sales by Market2 Life 1 3Q19 YTD. 2 Full year 2019 projection.
Slide 22: Market trends create significant opportunity
Market trends create significant opportunity 17th Annual Employee Benefit Trend Study Market Trends Benefits are a strategic business enabler Shift to voluntary benefits favors carriers with a distinct value proposition Evolving third party ecosystem Increased carrier consolidation
Slide 23: Market trends create significant opportunity: Group Benefits ecosystem
E M P L O Y E R Employee Human Capital Management & Payroll Market trends create significant opportunity Broker / Consultant Benefits are a strategic business enabler Shift to voluntary benefits favors carriers with a distinct value proposition Evolving third party ecosystem Increased carrier consol
Slide 24: Topline growth driving operating leverage
Adjusted PFO CAGR +5% +5% 8.0% Direct Expense Ratio2 7.5% Highlights #1 player with a 16% market share3 Growing faster than the market4 Investing ~$100 million per year in new technology capabilities Driving down expense ratio Topline growth driving operating leverage 7.3% 7.2% 6.9% 1 1 1 Excludes o
Slide 25: Proven track record delivering strong bottom line growth
Strong business fundamentals Economic and tax reform tailwinds Competitive advantages drive voluntary Group Life Mortality Ratio Adjusted Earnings Group Non- Medical Health IABR1 ($ in millions) 1 Interest adjusted benefit ratio. CAGR +25% +20% Proven track record delivering strong bottom line growt
Slide 26: Group Benefits
Group Benefits Todd Katz Executive Vice President, Group Benefits
Slide 27: Our approach to outpace market growth
Maximize the core Invest in underpenetrated segments Grow voluntary Expand the product set Our approach to outpace market growth
Slide 28: National Accounts – Extending our lead
1 Based on 2016 annual premium and equivalents. 2 2016 – 2019 annualized, excluding the loss of one large dental case. 3 2018 and 2019 YTD. Growth Opportunities MetLife #1 28% Estimated Market Growth: 1–2% Market Share Over 5,000 Employees MetLife growth2: 5% National Accounts – Extending our lead 9
Slide 29: Regional Market – Focused distribution strategy
1 Based on 2016 annual premium and equivalents. 2 2016 – 2019 annualized. 3 Based on employer information submitted through ERISA 5500 forms as of year end 2018. MetLife #3 7% Estimated Market Growth: 3-5% Expect to double market growth rate while preserving margins Top brokers taking share Only 25%
Slide 30: Small Business – Innovating to disrupt
Industry-first quote-to-claim platform Simplified customer administration Greater voluntary reach Full roll out in 2020 1 Based on 2016 annual premium and equivalents. 2 2016 – 2019 annualized. Estimated Market Growth: 4-6% MetLife growth2: 6-7% Small Business – Innovating to disrupt Market Size1: $
Slide 31: Small business solutions
I MetLife 'C f small business solutions
Slide 32: Voluntary opportunity is compelling
Adjusted PFO 3Q19 YTD Year-over-year Growth Group Benefits $13,721 5% Employee-paid $5,395 9% Voluntary1 $706 37% Voluntary1 Adjusted PFO CAGR +30% $411 $706 $514 $694 $526 ($ in millions) Voluntary opportunity is compelling 1 A&H and Legal. 2 As of December 31, 2018. ($ in millions) Voluntary Produ
Slide 33: Why we win in voluntary benefits
76_84 Why we win in voluntary benefits Ability to leverage size and strength of relationships Broadest product portfolio in the industry Leading employee engagement capabilities High-tech, high-touch service delivery model Trusted brand builds loyalty
Slide 34: Group Benefits
Group Benefits Esther Lee Executive Vice President, Global Chief Marketing Officer
Slide 35: Winning in voluntary requires customer focus
76_84 Deep insights Relevant positionings Engaging experience Winning in voluntary requires customer focus Employee Benefit Trends Study Consumer/employee segmentation Tailored by product and stakeholder Address needs, not just features Not:Trigger à Enroll But:Right tool at right time
Slide 36: Customer video: life insurance testimonial
Slide 37: Customer video: Jon & Whitney, newlyweds
Slide 38: Customer focus helps us win with employees
Enrollment Rate1 Perceptions2 Customer focus helps us win with employees Interest in enrolling +25% Understands benefits +16% Value of benefits +32% Better opinion of MetLife +35% Better opinion of Employer +14% Enhanced Conditions Basic Conditions Optimal Conditions Up to 5-10x 1 Full year 2018. 2
Slide 39: Customer focus extends beyond acquisition to retention
Modern Website SMS/Text Servicing Mobile Designed Built for customers’ growing expectations Intuitive, integrated customer experience 10 million registered users and counting Highlights Customer focus extends beyond acquisition to retention
Slide 40: Group Benefits
Group Benefits Todd Katz Executive Vice President, Group Benefits
Slide 41: Robust pipeline of additional opportunities
1 2019 Midyear Deviner HSA Research Report. Based on assets under management and year over year market growth as of June 30, 2019. 2 NAPHIA state of the industry report 2019 annualized premiums. Growth 2014-2019. 3 Caring.com survey, 2019. Digital Estate Planning Pet Insurance Approach Market Size M
Slide 42: Legal wills made easy
an Wiking Legal wills made easy
Slide 43: Group Benefits
Group Benefits Ramy Tadros President, U.S. Business
Slide 44: Key Takeaways
Key Takeaways Clear leader in highly attractive business Resilient across cycles Positioned to outgrow the market
Slide 45: Retirement and Income Solutions
Retirement and Income Solutions Ramy Tadros President, U.S. Business
Slide 46: Key Messages
Leading institutional retirement player Diversified business with distinct competitive advantages Strong free cash flow and attractive return on equity Disciplined execution subject to strict return hurdles Key Messages
Slide 47: Retirement and Income Solutions
Retirement and Income Solutions Graham Cox Executive Vice President, Retirement and Income Solutions
Slide 48: Broad set of market leading businesses
1 Market positions based on IBIS study for Corporate Owned Life Insurance. LIMRA rankings for full-year 2018, per LIMRA’s U.S. Group Annuity Risk Transfer; U.S. Individual Structured Settlements; and, Stable Value and Funding Agreement Products surveys. Entire market represented for pensions. In a s
Slide 49: Diversified product mix drives strong results
Total Liabilities1 1As of September 30, 2019. Total liabilities include Future Policy Benefits, Policyholder Account balances, Separate Account liabilities, and off-balance sheet Synthetic GIC notional amounts of $28 billion. 2 Based on allocated equity. 3 Percentage of pre-tax statutory earnings to
Slide 50: Value creation driven by defensible competitive advantage
76_84 Large Balance Sheet Strong Ratings Distribution Relationships Value creation driven by defensible competitive advantage Scale and Efficiency 1 Statutory balance sheet as of September 30, 2019. U.S. domestic life insurance companies combined total. 2 S&P rating for U.S. domestic life insurance
Slide 51: Rigorous risk management
Rigorous risk management Strong Credit Underwriting Robust Asset-Liability Management Defined Risk Appetite
Slide 52: Disciplined pricing, growing responsibly
Disciplined pricing, growing responsibly IRR Above Hurdle Rate Capital Deployed New business written above return targets Average payback period 5 years Target business we can duration match Larger deals, under-penetrated segments Highlights LTM Value of New Business1 1 Last twelve months (LTM) = 4Q
Slide 53: Key Takeaways
Key Takeaways Leading player Disciplined execution Strong FCF and ROE
Slide 54: Investments
Investments Steven J. Goulart Chief Investment Officer President, MetLife Investment Management
Slide 55: Key Messages
Large, diversified global portfolio with strong private asset capabilities Consistent investment process and performance General account (GA) portfolio well-positioned Strong third-party investment management growth opportunities Key Messages
Slide 56: MetLife Investment Management (MIM) overview
$596B Manages MetLife general account $456 billion GA AUM Disciplined asset-liability management Prudent underwriting and risk management Leverage capabilities for institutional investors worldwide $140 billion Institutional Client AUM Tailored solutions to meet client objectives Total AUM1 by Core
Slide 57: Global investment portfolio: think global, act local
Global investment portfolio: think global, act local $456B U.S.: $300 billion7 GA AUM Benefits from diversification and private assets Asia: $131 billion GA AUM Significant USD investments Latin America: $16 billion GA AUM Portfolios well positioned for recent developments EMEA: $9 billion GA AUM La
Slide 58: Strong private asset capabilities
As of December 31, 2015 $387B GA AUM allocation since 1/1/2016 Strong private asset capabilities Strong origination platforms provide competitive advantage Private assets represent ~30% of GA AUM $22 billion of GA originations through 3Q19 YTD As of September 30, 2019 $456B GA AUM 2: 1 Represents GA
Slide 59: Strong returns from private equity
Private Equity Returns Strong returns from private equity $7.2 billion1, diversified across strategy, geography and managers No manager greater than 4%; no fund greater than 2% Attractive fit for long-tailed liabilities High returns with lower volatility than public equities 1 Represents private equ
Slide 60: Consistent investment performance
$12.5 $17.4 $13.3 $16.4 $16.5 ($ in billions) Roll Off vs. Reinvestment Net Investment Income1 Consistent investment performance $13.0 1 As reported, on an adjusted basis.
Slide 61: Favorable loss history over time
Favorable loss history over time Since 2008: Fixed maturity securities: average annual impairment rate of 0.16% Commercial mortgage loans: average annual charge-off rate of 0.04% Agricultural mortgage loans: average annual charge-off rate of 0.08% Cumulative impairment rate of 1.2%, half the industr
Slide 62: Early repositioning is critical
Note: Credit portfolio includes public and private corporates, municipals and foreign governments. 1Represents % of GA AUM at respective periods. Early repositioning is critical Reduced allocation to below investment grade Reduced bank loans and increased quality Small BBB- credit exposure High qual
Slide 63: MIM: Institutional. But far from typical.
MIM: Institutional. But far from typical.
Slide 64: Strong growth in Institutional Client AUM and adjusted earnings
$140B1 1 Institutional Client AUM as of September 30, 2019. At estimated fair value. 2 Includes limited partnerships, collective trusts, mutual funds registered under the Investment Company Act and other vehicles offered or available to qualifying investors, including third parties and affiliates. 3
Slide 65: Key Takeaways
Key Takeaways Consistent process and performance General account well-positioned Growth opportunity in institutional client asset management
Slide 66: Asia
Asia Kishore Ponnavolu President, Asia
Slide 67: Key Messages
Key Messages Well-positioned in an attractive region Realizing the benefits of Accelerating Value Differentiated strategies across markets
Slide 68: Complementary businesses across mature and secular growth markets
Complementary businesses across mature and secular growth markets 1 3Q19 YTD. 2 2018 Value of New Business is the present value of future profits net the cost of capital and time value of guarantees from new sales. Adjusted Earnings1 by Country Value of New Business2 Japan Rest of Asia Japan Rest of
Slide 69: Realizing the benefits of Accelerating Value
$92 $122 $112 $109 CAGR +10% +12% GA Assets Under Management1 ($ in billions) Adjusted Earnings2 and Cash ($ in millions) 1 Excludes fair value adjustments and includes operating joint ventures, each on a constant currency basis. 2 Excludes total notable items, calculated on a constant currency basi
Slide 70: Differentiated strategies across markets
76_84 Japan China Bangladesh Drive continuous operational improvement Optimize portfolio to manage risk and capital Leverage distribution strength Scale up professional agency Provide customer centric Life and A&H solutions Market leader Scale up professional agency Continue to invest in core operat
Slide 71: Opportunity in Health and Retirement in Japan
Opportunity in Health and Retirement in Japan 1 3Q19 YTD. 2 Source: SwissRe, July 2019. 3 Source: 2018 premiums based on local statutory filings. 1 Sales1 by Distribution Japan Market #3 global life market2 Super-aging society Growing Health and Retirement needs MetLife Japan #6 life insurer3 Distri
Slide 72: Strategy to enhance earnings and cash in Japan
Strategy to enhance earnings and cash in Japan Drive continuous operational improvement Optimize portfolio to manage risk and capital Leverage distribution strength
Slide 73: China
China Rebecca Tadikonda Executive Vice President Head of Strategic Growth Markets, Asia
Slide 74: Agency led growth model in China
Agency led growth model in China 1 3Q19 YTD. 2 Source: SwissRe, July 2019. 3 2018 gross written premiums as a percentage of GDP. 4 Source: National Bureau of Statistics of China, 2018. 1 Sales1 by Distribution China Market #2 global life market2 Fast growing mass affluent Low life insurance penetrat
Slide 75: Accelerating growth in China
Customer acquisition Hiring and training Performance management Servicing and customer engagement Delivering Best in Class Agency +100% Agency Headcount Market Ranking1 1 Source: Insurance Association of China, September 2019. Based on annualized new business premiums among foreign players. Accelera
Slide 76: Asia
Asia Kishore Ponnavolu President, Asia
Slide 77: Key Takeaways
Key Takeaways Strong position in attractive region Value actions paying off Differentiated market strategies to drive growth and value
Slide 78: Latin America
Latin America Oscar Schmidt President, Latin America
Slide 79: Key Messages
Key Messages #1 life insurer in Latin America High margin protection products with diversified distribution Solid underlying growth Large value pools in core businesses in Mexico and Chile Long-term growth in Brazil
Slide 80: Well-established footprint
Highlights #1 life insurer in Mexico with 21% share2 #1 life insurer and #1 pension provider in Chile3 Emerging presence in Brazil Well-established footprint 1 3Q19 YTD. 2 Source: Asociacion Mexicana de Instituciones de Seguros, in gross written premiums for 2018. Includes Life, Medical and Personal
Slide 81: Protection products with diversified distribution
1 Adjusted PFO Product Mix1 Adjusted PFO Distribution Mix1 1 3Q19 YTD. Protection products with diversified distribution
Slide 82: Solid underlying growth driven by Mexico and Chile
Growth driven by Mexico and Chile Dividends to holding companies 80%+ of adjusted earnings Adjusted return on allocated equity 18%+ Managing regulatory environment Highlights Adjusted Earnings1 Solid underlying growth CAGR +1% CAGR +5% 1Excluding total notable items. Reported Constant Currency ($ in
Slide 83: Strategic focus on three key markets
76_84 Mexico Chile Brazil Drive value in worksite government Accelerate diversification into private sector Continue to grow agency Expand bancassurance Protect value in ProVida Scale employee benefits Grow bancassurance Accelerate agency Strategic focus on three key markets
Slide 84: MetLife Mexico
MetLife Mexico Sofia Belmar Senior Vice President, General Manager, Mexico
Slide 85: Mexico Overview
1 3Q19 YTD. 2 Source: 2Q 2019 National Occupation and Employment Survey (total population). 3 Considering 2018 Industry Premiums / GDP. 4 AMIS (Asociación Mexicana de Instituciones de Seguros / Mexican Association of Insurance Institutions) - EstadisticAMIS 3Q 2019 (Life and A&H). Ranking based on s
Slide 86: Strategic focus in Mexico
Strategic focus in Mexico Drive value in worksite government Accelerating growth in the private sector Tap voluntary private market Grow private sector agency
Slide 87: Drive value in worksite government
Drive value in worksite government Financial inclusion for low to mid income government employees Payroll deduction drives high persistency Flexible product that protects different life events Agency network with national reach Deepening customer relationships and retention through digital
Slide 88: Accelerating growth in the private sector
Accelerating growth in the private sector Untapped opportunity in low-mid segment Large underserved low to mid income segment Leverage government value proposition and product Scale existing B2B capabilities Build dedicated worksite distribution channel Outperforming peers in affluent segment 12%1 o
Slide 89: Latin America
Latin America Oscar Schmidt President, Latin America
Slide 90: Key Takeaways
Key Takeaways Largest life insurer in Latin America with solid underlying growth High margins and diversified distribution Well positioned to protect and grow value
Slide 91: MetLife Holdings
MetLife Holdings John McCallion Executive Vice President and Chief Financial Officer
Slide 92: Key Messages
Key Messages Large, stable in-force business Diversified set of liabilities and performance drivers Steadily improving risk profile Reliable source of cash and adjusted earnings
Slide 93: Large, stable in-force business
$145B Total Liabilities1 Long-Term Care Variable Annuities with Living Benefits Large, stable in-force business Highlights Diversified set of insurance liabilities Conservative policy provisions Large participating, closed block of life insurance Strong asset-liability management 1 As of September 3
Slide 94: Diversified set of liabilities and drivers
Diversified set of liabilities and drivers Product 2018 Adjusted PFOs Total Liabilities1 Key Performance Drivers 2018 Adjusted Earnings2 Variable Annuities – Living Benefits $0.8 $27 Equity market ~55% Variable Annuities – No Living Benefits 24 Fixed Annuities 0.1 8 Interest rates Traditional Life a
Slide 95: Meet customer commitments while optimizing value levers
Meet customer commitments while optimizing value levers Contractual Operational Behavioral Financial
Slide 96: Continued expense management
Direct Expense Ratio Continued expense management -20 bps -200 bps Adjusted Expense Ratio -280 bps -240 bps
Slide 97: Steadily improving risk profile
VA Policies (in thousands) -23% VA Account Values ($ in billions) -14% 936 717 $59 $51 Living Benefits Non-Living Benefits Steadily improving risk profile
Slide 98: Earnings now, cash now
Earnings now, cash now MetLife Holdings Adjusted Earnings1 +14% Highlights Over $1 billion in adjusted earnings Strong cash generation Double-digit ROE and steadily improving Delivering 1-2% annual EPS accretion -9% 136% Cash2 96% 1 Excluding total notable items. 2 Percentage of pre-tax statutory ea
Slide 99: Key Takeaways
Key Takeaways Large and stable in-force Improving risk profile Steady earnings and cash
Slide 100: Outlook
Outlook John McCallion Executive Vice President and Chief Financial Officer
Slide 101: Key Messages
Key Messages Delivering another strong year of financial performance in 2019 Maintaining ROE and free cash flow targets Exceeding expense commitment Returning excess capital to shareholders remains a top priority
Slide 102: Near-Term Targets and Corporate Guidance
Mixed macro environment in 2020: U.S. growth still solid, led by consumer Continued headwinds from low interest rates U.S. dollar remains strong Near-term1 targets: Adjusted return on equity2 of 12-14% Free cash flow ratio of 65-75% of adjusted earnings Corporate guidance for 2020: Variable investme
Slide 103: Guidance: Group Benefits
1% change in Group Life mortality ratio translates to approximately $60 million of adjusted earnings3 1% change in Group Non-Medical Health interest adjusted benefit ratio translates to approximately $60 million of adjusted earnings3 Adjusted premiums, fees and other revenues (PFOs) expected to grow
Slide 104: Guidance: Retirement and Income Solutions
Both spread based and fee based liability exposures2 expected to grow 2-4% annually Investment spread3 of 112 bps in LTM, with variable investment income contributing 25 bps Investment spread3 expected to be within 90-115 bps, with variable investment income contributing 15-20 bps Near-Term Guidance
Slide 105: Guidance: Property & Casualty
1% change in overall P&C combined ratio2 translates to approximately $30 million of adjusted earnings3 1% change in Auto combined ratio2 translates to approximately $20 million of adjusted earnings3 1% change in Homeowners & Other combined ratio2 translates to approximately $10 million of adjusted e
Slide 106: Guidance: Asia
Mid single-digit sales growth on a constant currency basis in 2020, moving higher in 2021-2022, double-digit growth in emerging markets GA AUM3 to grow at high single-digits on a constant currency basis Mid to high single-digit adjusted earnings growth on a constant currency basis Dividends to holdi
Slide 107: Guidance: Latin America
Mid single-digit adjusted earnings growth on a constant currency basis in 2020, moving to high single-digits in 2021-2022 High single-digit annual growth in adjusted PFOs on a constant currency basis Dividends to holding companies expected to be 80-90% of adjusted earnings Near-Term Guidance on Cert
Slide 108: Guidance: EMEA
Sales and adjusted PFO growth of mid-to-high single-digits on a constant currency basis Mid single-digit adjusted earnings growth on a constant currency basis Dividends to holding companies expected to be 90-100% of adjusted earnings Near-Term Guidance on Certain Key Items Key Sensitivities Adjusted
Slide 109: Guidance: MetLife Holdings
Roughly 70% of the separate account (SA) assets are in equities 10 bps change in yield translates to approximately $55 million of adjusted earnings annually 1% change in life interest adjusted benefit ratio translates to approximately $25 million of adjusted earnings annually Adjusted PFOs expected
Slide 110: Key Takeaways
Key Takeaways Delivering another strong year of financial performance in 2019 Maintaining ROE and free cash flow targets Exceeding expense commitment Returning excess capital to shareholders remains a top priority
Slide 111: Closing Remarks
Closing Remarks Michel Khalaf President and Chief Executive Officer
Slide 112: Our Next Horizon
Our Next Horizon Simpler & More Focused Great Set of Businesses Strong Free Cash Flow
Slide 113: Appendix
Appendix Il MetLife
Slide 114: Interest Rates: Base vs. Stress Scenario
12/31/2019 12/31/2020 12/31/2021 12/31/2022 Base Stress Base Stress Base Stress Base Stress 3-Month LIBOR1 1.90% 1.90% 1.45% 1.00% 1.36% 1.00% 1.38% 1.00% 2-Year Treasury1 1.58% 1.58% 1.47% 1.00% 1.49% 1.00% 1.56% 1.00% 10-Year Treasury1 1.69% 1.69% 1.76% 1.00% 1.85% 1.10% 1.95% 1.20% 1 Base rates b
Slide 115: Forward-looking statements
This presentation may contain or incorporate by reference information that includes or is based upon forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give expectations or forecasts of future events. These statements can
Slide 116: Explanatory Note on Non-GAAP Financial Information and Reconciliations
Explanatory Note on Non-GAAP Financial Information and Reconciliations
Slide 117: Explanatory Note on Non-GAAP Financial Information
Any references in this presentation (except in this Explanatory Note on Non-GAAP Financial Information and Reconciliations) to: Should be read as, respectively: (i) adjusted earnings; (i) adjusted earnings available to common shareholders; (ii) adjusted earnings per share; (ii) adjusted earnings ava
Slide 118: Non-GAAP reference definitions
(xv) other expenses, net of capitalization of DAC, as reported on an adjusted basis; (xv) other expenses, net of capitalization of DAC; (xvi) other expenses, net of capitalization of DAC, excluding total notable items related to other expenses, as reported on an adjusted basis; (xvi) other expenses,
Slide 119: Definitions of non-GAAP and other financial measures
MetLife’s definitions of non-GAAP and other financial measures discussed in this presentation may differ from those used by other companies: Adjusted earnings and related measures adjusted earnings; adjusted earnings available to common shareholders; adjusted earnings available to common shareholder
Slide 120: Adjusted revenues adjustments
The following additional adjustments are made to revenues, in the line items indicated, in calculating adjusted revenues: Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to NIGL and NDGL (Unearned revenue adjustments) and certain variable
Slide 121: Adjusted return on equity definitions
Adjusted return on MetLife, Inc.'s common stockholders' equity: adjusted earnings available to common shareholders divided by MetLife, Inc.'s average common stockholders' equity. Adjusted return on MetLife, Inc.'s common stockholders' equity, excluding AOCI other than FCTA: adjusted earnings availab
Slide 122: GA AUM and assets under management definitions
GA AUM (excluding Fair Value Adjustment (FVA)) excludes the following FVA: (i) unrealized gain (loss) on investments carried at estimated fair value and (ii) adjustments from carrying value to estimated fair value on mortgage loans and real estate and real estate joint ventures. MetLife believes tha
Slide 123: Statistical sales information
Statistical sales information: U.S.: Group Benefits: calculated using 10% of single premium deposits and 100% of annualized full-year premiums and fees from recurring premium policy sales of all products. Retirement and Income Solutions: calculated using 10% of single premium deposits and 100% of an
Slide 124: Reconciliation of Net Income to Adjusted Earnings
Reconciliation of Net Income (Loss) available to MetLife, Inc.’s Common Shareholders to Adjusted Earnings Available to Common Shareholders 117 (viii)
Slide 125: Equity Details and Return on Equity
1 Annualized using year-to-date results. Equity Details and Return on Equity 117 (ix)
Slide 126: Expense Detail and Ratios
1 For the year ended December 31, 2016, Divested businesses and lag elimination includes adjustments related to the financial impact of converting MetLife’s Japan operations to calendar year end reporting without retrospective application of this change to prior periods. Expense Detail and Ratios 11
Slide 127: Reconciliation of Adjusted Earnings, Excluding Total Notable Items
Reconciliation of Adjusted Earnings Available to Common Shareholders, Excluding Total Notable Items 117 (xi)
Slide 128: Reconciliation of Adjusted Earnings, Excluding Total Notable Items (Continued)
Reconciliation of Adjusted Earnings Available to Common Shareholders, Excluding Total Notable Items (Continued) 117 (xii)
Slide 129: Expense Detail and Ratios – Group Benefits
Expense Detail and Ratios – Group Benefits 117 (xiii)
Slide 130: Reconciliation of Total Investments to GA AUM and Total AUM
Reconciliation of Total Investments to GA AUM and Total AUM 1 U.S. includes the balances for the U.S. and MetLife Holdings segments as well as Corporate & Other. 117 (xiv)
Slide 131: Private Equity Returns
Private Equity Returns 1 Yields presented are annualized using year-to-date results. 117 (xv)
Slide 132: Below Investment Grade and Syndicated Bank Loans in Credit Portfolio
Below Investment Grade and Syndicated Bank Loans in Credit Portfolio 1 Credit portfolio includes public and private corporates, municipals and foreign governments. 117 (xvi)
Slide 133: Reconciliation of Net Investment Income
Reconciliation of Net Investment Income to Net Investment Income, As Reported on an Adjusted Basis 1 For the year ended December 31, 2016, Divested businesses and lag elimination includes adjustments related to the financial impact of converting MetLife’s Japan operations to calendar year end report
Slide 134: Reconciliation of Total Investments to GA AUM - Asia
Reconciliation of Total Investments to GA AUM - Asia 1 Includes MetLife, Inc.'s percentage interest in operating joint ventures of: (i) China, (ii) India, (iii) Malaysia and (iv) Vietnam, which are consolidated using the equity method of accounting and reported in other invested assets, a component
Slide 135: Adjusted Earnings and Cash - Asia
Adjusted Earnings and Cash - Asia 117 (xix)
Slide 136: MetLife
iy’ MetLife