Metlife, Inc. · NYSE:MET
Metlife — Investor Presentation (March 2012)
25 slides from Metlife's investor presentation, Mar 23, 2012
Slide 1: Explanatory Note on Non-GAAP Financial Information
The following additional adjustments are made to GAAP expenses, in the line items indicated, in calculating operating expenses: Policyholder benefits and claims and policyholder dividends excludes: (i) changes in the policyholder dividend obligation related to NIGL and NDGL, (ii) inflation-indexed b
Slide 2: Overview
Solid financial results, despite macro headwinds A global and growing franchise Strong capital position Prudent risk management Overview Focused on creating long-term shareholder value
Slide 3: MetLife's 2011 Results
MetLife’s 2011 Results Solid year in a challenging environment Operating earnings per share grew 16% year over year, despite: – Low interest rates – Volatile equity markets – Record natural disasters Alico providing expected value; integration on-track
Slide 4: Full Year 2011 Financial Overview
2011 Plan 2011 Actual Operating Earnings (in $ millions) $5,060 - $5,490 $5,358 Operating Earnings per Share $4.75 - $5.15 $5.02 Operating Return on Equity 10.6% - 11.4% 11.0% Book Value* (excluding AOCI) $46.80 - $47.65 $49.02 * Book Value per Common Share, actual common shares outstanding Full Yea
Slide 5: A Global and Growing Franchise
Global Presence Risk Management Diversified Distribution & Products Financial Strength A Global and Growing Franchise Leadership positions in large established markets Strong and growing presence in high growth markets with favorable demographics and high margins Disciplined risk management to prote
Slide 6: Leadership Positions in Markets of Today and Tomorrow
Established Significant & Growing Emerging Leadership Positions in Markets of Today and Tomorrow United States Japan Mexico Korea Poland Chile Russia Brazil China India Turkey High Margins with Attractive Growth Prospects Largest Global Markets with Strong Cash Generation Fast Growing with Good Marg
Slide 7: Diversified Products to Meet Customers Needs
2012 Plan Operating Earnings by Product ¹ Diversified Products to Meet Customers Needs International United States Individual Life Auto & Home Non-Medical Health Retirement Group Insurance Group Life Corporate Benefit Funding Retirement Individual Life 1. Calculated using mid-point of range, excludi
Slide 8: Guiding Principles for Building on Our Strengths
Take a portfolio view of our businesses Continuously assess our strategy Balance growth, profitability and risk Optimize the use of capital Guiding Principles for Building on Our Strengths
Slide 9: Retail Key Themes
Retail Key Themes Commitment to Face-to-Face Profitable Growth Investing for Return Organizational Alignment
Slide 10: Retail Organization Structure
Retail Organization Structure Retail Business Product Distribution Administration/ Marketing Promotes accountability Aligns strategy across Product and Distribution Drives efficiency gains
Slide 11: Variable Annuity Highlights
Variable Annuity Highlights Well diversified block – Over one-third of our VA block has no living benefits – Dollar cost averaged over time - never stopped writing – By channel Proven risk management practices – Product design – Hedging 2012 Variable Annuity sales $17.5B to $18.5B – Plan developed b
Slide 12: Living Benefits
Living Benefits Variable Annuity Account Value by Guarantee Type (Domestic) Total VA Account Balance¹ = $139 Billion 1. Deferred Variable Annuities account balance as of December 31, 2011
Slide 13: GMIB MAX
GMIB MAX Protected Growth Strategy (“PGS”) funds provide more stable fee base More capital efficient Improved distribution of returns
Slide 14: Return on Investment (ROI) Distribution
Return on Investment (ROI) Distribution GMIB MAX: Distribution of Returns No scenarios observed below 0% ROI 1. GMIB MAX (5% Rollup) launched on Jan 2, 2012. The pricing results were based on market conditions as of Oct 31, 2011. Incidences of ROIs reflected in the chart above are the results of rou
Slide 15: Actively Managing Interest Rate Risk
Actively Managing Interest Rate Risk Approximately $47 billion notional² to hedge against low rates Protection extending into next decade 1. Estimated based on August 31, 2011 rates, assuming parallel curve shift. 2. MetLife investment portfolio (excluding International and VA hedging program and Me
Slide 16: Peripheral European Sovereign Exposure
$682 $165 U.S. GAAP Book Value Peripheral European Sovereign Exposure Total Peripheral European Sovereign exposure is 0.1% of total Managed Assets, as of 12/31/11 Net Impairment and Losses of $272 million, after-tax in 2011 Remaining Greece exposure manageable See Explanatory Note on Non-GAAP Financ
Slide 17: European Bank Exposure
U.S. GAAP Book Value European Bank Exposure 12/31/2010 12/31/2011 Peripherals ¹ Non-Peripherals $9,279 $6,263 Country of Domicile ($ Millions) Spain, Ireland, Portugal, Italy and Greece. The exposures presented above are based on MetLife Inc. 4Q 2011 financials and therefore include 11/30/11 figures
Slide 18: LTV and DSCR Matrix
LTV and DSCR Matrix $42.1 Billion 1 1 Commercial Mortgages 61% Loan to Value (LTV) 2.1x average Debt Service Coverage Ratio (DSCR) Commercial mortgage valuation allowance of $398 million Delinquency rate of 16 basis points Low losses in 2011 of $12 million LTV >1.2x 1.0-1.2x <1.0x Total < 65% 61.8%
Slide 19: Comprehensive Capital Analysis and Review (CCAR)
Comprehensive Capital Analysis and Review (“CCAR”) One of the 19 Bank Holding Companies (“BHCs”) Federal Reserve objected to 2012 capital plan – Share repurchases of $2.0 billion – Common stock dividend increase to $1.10 per share from $0.74 per share MetLife submitted its own calculations above req
Slide 20: Life Insurance vs. BHC Profile
Life Insurance -vs- BHC Profile CCAR methodology designed for banks Risk profile unique compared to BHC – Investment portfolio composition driven by liability profile – Corporate bonds “penalized” in risk-weighted assets – Separate accounts “penalized” by inclusion in Tier 1 Leverage Ratio MetLife i
Slide 21: Strong Capital Position
Strong Capital Position Strong capitalization at operating subsidiaries at year-end – U.S. combined risk based capital (RBC): 450% – Japan solvency margin ratio (SMR): 881% Deployable capital at Holding Companies – $3.5 billion at year-end 2011 – Estimated $6 to $7 billion at year-end ¹ Committed to
Slide 22: Summary
Delivering solid financial results in a challenging environment Strong presence in established and high growth markets Focused on profitable growth Strong capital generation to fuel growth and deliver shareholder value Summary
Slide 23: Reconciliation of Net Income to Operating Earnings Available to Common Shareholders
2011 Reconciliation of Net Income (Loss) Available to MetLife, Inc.’s Common Shareholders to Operating Earnings Available to Common Shareholders and Reconciliation of Net Income (Loss) Available to MetLife, Inc.’s Common Shareholders Per Common Share – Diluted to Operating Earnings Available to Comm
Slide 24: Reconciliation of Common Equity and Book Value per Common Share
2011 Reconciliation of MetLife, Inc.’s Common Equity and Reconciliation of MetLife, Inc.’s Book Value per Common Share Total Company Return on MetLife, Inc.'s common equity 12.8% Return on MetLife, Inc.'s common equity, excluding AOCI 13.8% Operating return on MetLife, Inc.'s common equity 10.2% Ope
Slide 25: MetLife
MetLife