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þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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13-4075851
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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200 Park Avenue, New York, N.Y.
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10166-0188
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
o
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Page
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Item 1.
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Financial Statements (at June 30, 2014 (Unaudited) and December 31, 2013 and for the Three Months and Six Months Ended June 30, 2014 and 2013 (Unaudited))
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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June 30, 2014
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December 31, 2013
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||||
Assets
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Investments:
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||||
Fixed maturity securities available-for-sale, at estimated fair value (amortized cost: $339,287 and $333,599, respectively; includes $4,180 and $4,005, respectively, relating to variable interest entities)
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$
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367,056
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$
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350,187
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Equity securities available-for-sale, at estimated fair value (cost: $3,252 and $3,012, respectively)
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3,863
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3,402
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Fair value option and trading securities, at estimated fair value (includes $690 and $662, respectively, of actively traded securities; and $84 and $92, respectively, relating to variable interest entities)
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17,831
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17,423
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Mortgage loans (net of valuation allowances of $294 and $322, respectively; includes $638 and $1,621, respectively, at estimated fair value, relating to variable interest entities; includes $367 and $338, respectively, under the fair value option)
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57,223
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57,706
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Policy loans (includes $3 and $2, respectively, relating to variable interest entities)
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11,785
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11,764
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Real estate and real estate joint ventures (includes $9 and $1,141, respectively, relating to variable interest entities, includes $49 and $186, respectively, of real estate held-for-sale)
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10,101
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10,712
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Other limited partnership interests (includes $53 and $53, respectively, relating to variable interest entities)
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7,964
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7,401
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Short-term investments, principally at estimated fair value (includes $22 and $8, respectively, relating to variable interest entities)
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12,366
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13,955
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Other invested assets, principally at estimated fair value (includes $71 and $78, respectively, relating to variable interest entities)
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17,116
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16,229
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Total investments
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505,305
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488,779
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Cash and cash equivalents, principally at estimated fair value (includes $45 and $70, respectively, relating to variable interest entities)
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7,393
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7,585
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Accrued investment income (includes $23 and $26, respectively, relating to variable interest entities)
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4,234
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4,255
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Premiums, reinsurance and other receivables (includes $21 and $22, respectively, relating to variable interest entities)
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23,730
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21,859
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Deferred policy acquisition costs and value of business acquired (includes $260 and $255, respectively, relating to variable interest entities)
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25,915
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26,706
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Goodwill
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10,430
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10,542
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Other assets (includes $140 and $152, respectively, relating to variable interest entities)
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9,136
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8,369
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Separate account assets (includes $1,164 and $1,033, respectively, relating to variable interest entities)
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324,977
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317,201
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Total assets
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$
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911,120
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$
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885,296
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Liabilities and Equity
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Liabilities
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Future policy benefits (includes $542 and $516, respectively, relating to variable interest entities)
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$
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189,675
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$
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187,942
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Policyholder account balances (includes $63 and $56, respectively, relating to variable interest entities)
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213,799
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212,885
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Other policy-related balances (includes $203 and $123, respectively, relating to variable interest entities)
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15,361
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15,214
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Policyholder dividends payable
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682
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675
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Policyholder dividend obligation
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2,986
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1,771
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Payables for collateral under securities loaned and other transactions
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33,187
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30,411
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Short-term debt
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100
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175
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Long-term debt (includes $505 and $1,868, respectively, at estimated fair value, relating to variable interest entities)
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16,783
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18,653
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Collateral financing arrangements
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4,196
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4,196
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Junior subordinated debt securities
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3,193
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3,193
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Current income tax payable
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232
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186
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Deferred income tax liability
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10,453
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6,643
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Other liabilities (includes $66 and $88, respectively, relating to variable interest entities)
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25,214
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23,168
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Separate account liabilities (includes $1,164 and $1,033, respectively, relating to variable interest entities)
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324,977
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317,201
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Total liabilities
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840,838
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822,313
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Contingencies, Commitments and Guarantees (Note 14)
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Redeemable noncontrolling interests
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108
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887
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Equity
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MetLife, Inc.’s stockholders’ equity:
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Preferred stock, par value $0.01 per share; 200,000,000 shares authorized: 84,000,000 shares issued and outstanding; $2,100 aggregate liquidation preference
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1
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1
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Common stock, par value $0.01 per share; 3,000,000,000 shares authorized; 1,129,845,890 and 1,125,224,024 shares issued at June 30, 2014 and December 31, 2013, respectively; 1,126,571,341 and 1,122,030,137 shares outstanding at June 30, 2014 and December 31, 2013, respectively
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11
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11
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Additional paid-in capital
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29,438
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29,277
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Retained earnings
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29,259
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27,332
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Treasury stock, at cost; 3,274,549 and 3,193,887 shares at June 30, 2014 and December 31, 2013, respectively
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(176
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)
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(172
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)
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Accumulated other comprehensive income (loss)
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11,058
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5,104
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Total MetLife, Inc.’s stockholders’ equity
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69,591
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61,553
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Noncontrolling interests
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583
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543
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Total equity
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70,174
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62,096
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Total liabilities and equity
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$
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911,120
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$
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885,296
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Three Months
Ended June 30, |
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Six Months
Ended June 30, |
||||||||||||
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2014
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2013
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2014
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2013
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Revenues
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Premiums
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$
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9,873
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$
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9,158
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$
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19,092
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$
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18,309
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Universal life and investment-type product policy fees
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2,458
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2,371
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4,879
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4,662
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|
||||
Net investment income
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5,259
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5,282
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10,294
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11,359
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|
||||
Other revenues
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490
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490
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|
968
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|
970
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|
||||
Net investment gains (losses):
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||||||||
Other-than-temporary impairments on fixed maturity securities
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(9
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)
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(35
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)
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(23
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)
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(64
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)
|
||||
Other-than-temporary impairments on fixed maturity securities transferred to other comprehensive income (loss)
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(6
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)
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(4
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)
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(2
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)
|
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(35
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)
|
||||
Other net investment gains (losses)
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(110
|
)
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149
|
|
|
(511
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)
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523
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|
||||
Total net investment gains (losses)
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(125
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)
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110
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|
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(536
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)
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424
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|
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Net derivative gains (losses)
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311
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(1,690
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)
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654
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|
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(2,320
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)
|
||||
Total revenues
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18,266
|
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15,721
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35,351
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33,404
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|
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Expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims
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9,988
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8,960
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19,312
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|
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18,355
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|
||||
Interest credited to policyholder account balances
|
1,709
|
|
|
1,846
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|
|
3,178
|
|
|
4,436
|
|
||||
Policyholder dividends
|
397
|
|
|
329
|
|
|
700
|
|
|
642
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|
||||
Other expenses
|
4,222
|
|
|
4,025
|
|
|
8,385
|
|
|
8,163
|
|
||||
Total expenses
|
16,316
|
|
|
15,160
|
|
|
31,575
|
|
|
31,596
|
|
||||
Income (loss) from continuing operations before provision for income tax
|
1,950
|
|
|
561
|
|
|
3,776
|
|
|
1,808
|
|
||||
Provision for income tax expense (benefit)
|
574
|
|
|
53
|
|
|
1,058
|
|
|
305
|
|
||||
Income (loss) from continuing operations, net of income tax
|
1,376
|
|
|
508
|
|
|
2,718
|
|
|
1,503
|
|
||||
Income (loss) from discontinued operations, net of income tax
|
—
|
|
|
2
|
|
|
(3
|
)
|
|
(1
|
)
|
||||
Net income (loss)
|
1,376
|
|
|
510
|
|
|
2,715
|
|
|
1,502
|
|
||||
Less: Net income (loss) attributable to noncontrolling interests
|
10
|
|
|
8
|
|
|
21
|
|
|
14
|
|
||||
Net income (loss) attributable to MetLife, Inc.
|
1,366
|
|
|
502
|
|
|
2,694
|
|
|
1,488
|
|
||||
Less: Preferred stock dividends
|
31
|
|
|
31
|
|
|
61
|
|
|
61
|
|
||||
Net income (loss) available to MetLife, Inc.’s common shareholders
|
$
|
1,335
|
|
|
$
|
471
|
|
|
$
|
2,633
|
|
|
$
|
1,427
|
|
Comprehensive income (loss)
|
$
|
4,228
|
|
|
$
|
(3,881
|
)
|
|
$
|
8,710
|
|
|
$
|
(3,703
|
)
|
Less: Comprehensive income (loss) attributable to noncontrolling interests, net of income tax
|
19
|
|
|
(5
|
)
|
|
62
|
|
|
4
|
|
||||
Comprehensive income (loss) attributable to MetLife, Inc.
|
$
|
4,209
|
|
|
$
|
(3,876
|
)
|
|
$
|
8,648
|
|
|
$
|
(3,707
|
)
|
Income (loss) from continuing operations, net of income tax, available to MetLife, Inc.’s common shareholders per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.18
|
|
|
$
|
0.43
|
|
|
$
|
2.34
|
|
|
$
|
1.30
|
|
Diluted
|
$
|
1.17
|
|
|
$
|
0.43
|
|
|
$
|
2.31
|
|
|
$
|
1.29
|
|
Net income (loss) available to MetLife, Inc.’s common shareholders per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.18
|
|
|
$
|
0.43
|
|
|
$
|
2.34
|
|
|
$
|
1.30
|
|
Diluted
|
$
|
1.17
|
|
|
$
|
0.43
|
|
|
$
|
2.31
|
|
|
$
|
1.29
|
|
Cash dividends declared per common share
|
$
|
0.350
|
|
|
$
|
0.550
|
|
|
$
|
0.625
|
|
|
$
|
0.735
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Treasury
Stock
at Cost
|
|
Net
Unrealized
Investment
Gains
(Losses)
|
|
Other-Than-
Temporary
Impairments
|
|
Foreign
Currency
Translation
Adjustments
|
|
Defined
Benefit Plans
Adjustment
|
|
Total
MetLife, Inc.’s
Stockholders’
Equity
|
|
Noncontrolling
Interests (1)
|
|
Total
Equity
|
||||||||||||||||||||||||
Balance at December 31, 2013
|
$
|
1
|
|
|
$
|
11
|
|
|
$
|
29,277
|
|
|
$
|
27,332
|
|
|
$
|
(172
|
)
|
|
$
|
8,553
|
|
|
$
|
(139
|
)
|
|
$
|
(1,659
|
)
|
|
$
|
(1,651
|
)
|
|
$
|
61,553
|
|
|
$
|
543
|
|
|
$
|
62,096
|
|
Treasury stock acquired in connection with share repurchases
|
|
|
|
|
|
|
|
|
(4
|
)
|
|
|
|
|
|
|
|
|
|
(4
|
)
|
|
|
|
(4
|
)
|
|||||||||||||||||||||
Stock-based compensation
|
|
|
|
|
161
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
161
|
|
|
|
|
161
|
|
|||||||||||||||||||||
Dividends on preferred stock
|
|
|
|
|
|
|
(61
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(61
|
)
|
|
|
|
(61
|
)
|
|||||||||||||||||||||
Dividends on common stock
|
|
|
|
|
|
|
(706
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(706
|
)
|
|
|
|
(706
|
)
|
|||||||||||||||||||||
Change in equity of noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
(22
|
)
|
|
(22
|
)
|
|||||||||||||||||||||
Net income (loss)
|
|
|
|
|
|
|
2,694
|
|
|
|
|
|
|
|
|
|
|
|
|
2,694
|
|
|
21
|
|
|
2,715
|
|
||||||||||||||||||||
Other comprehensive income (loss), net of income tax
|
|
|
|
|
|
|
|
|
|
|
5,902
|
|
|
69
|
|
|
(80
|
)
|
|
63
|
|
|
5,954
|
|
|
41
|
|
|
5,995
|
|
|||||||||||||||||
Balance at June 30, 2014
|
$
|
1
|
|
|
$
|
11
|
|
|
$
|
29,438
|
|
|
$
|
29,259
|
|
|
$
|
(176
|
)
|
|
$
|
14,455
|
|
|
$
|
(70
|
)
|
|
$
|
(1,739
|
)
|
|
$
|
(1,588
|
)
|
|
$
|
69,591
|
|
|
$
|
583
|
|
|
$
|
70,174
|
|
(1)
|
Net income (loss) attributable to noncontrolling interests excludes losses of redeemable noncontrolling interests of less than
$1 million
.
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional Paid-in Capital
|
|
Retained
Earnings
|
|
Treasury
Stock
at Cost
|
|
Net
Unrealized
Investment
Gains
(Losses)
|
|
Other-Than-
Temporary
Impairments
|
|
Foreign
Currency
Translation
Adjustments
|
|
Defined
Benefit Plans
Adjustment
|
|
Total
MetLife, Inc.’s
Stockholders’
Equity
|
|
Noncontrolling
Interests (1)
|
|
Total
Equity
|
||||||||||||||||||||||||
Balance at December 31, 2012
|
$
|
1
|
|
|
$
|
11
|
|
|
$
|
28,011
|
|
|
$
|
25,205
|
|
|
$
|
(172
|
)
|
|
$
|
14,642
|
|
|
$
|
(223
|
)
|
|
$
|
(533
|
)
|
|
$
|
(2,489
|
)
|
|
$
|
64,453
|
|
|
$
|
384
|
|
|
$
|
64,837
|
|
Stock-based compensation
|
|
|
|
|
165
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
165
|
|
|
|
|
165
|
|
|||||||||||||||||||||
Dividends on preferred stock
|
|
|
|
|
|
|
(61
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(61
|
)
|
|
|
|
(61
|
)
|
|||||||||||||||||||||
Dividends on common stock
|
|
|
|
|
|
|
(808
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(808
|
)
|
|
|
|
(808
|
)
|
|||||||||||||||||||||
Change in equity of noncontrolling interests
|
|
|
|
|
(39
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(39
|
)
|
|
17
|
|
|
(22
|
)
|
||||||||||||||||||||
Net income (loss)
|
|
|
|
|
|
|
1,488
|
|
|
|
|
|
|
|
|
|
|
|
|
1,488
|
|
|
14
|
|
|
1,502
|
|
||||||||||||||||||||
Other comprehensive income (loss), net of income tax
|
|
|
|
|
|
|
|
|
|
|
(4,025
|
)
|
|
49
|
|
|
(1,292
|
)
|
|
73
|
|
|
(5,195
|
)
|
|
(10
|
)
|
|
(5,205
|
)
|
|||||||||||||||||
Balance at June 30, 2013
|
$
|
1
|
|
|
$
|
11
|
|
|
$
|
28,137
|
|
|
$
|
25,824
|
|
|
$
|
(172
|
)
|
|
$
|
10,617
|
|
|
$
|
(174
|
)
|
|
$
|
(1,825
|
)
|
|
$
|
(2,416
|
)
|
|
$
|
60,003
|
|
|
$
|
405
|
|
|
$
|
60,408
|
|
(1)
|
Net income (loss) attributable to noncontrolling interests excludes gains of redeemable noncontrolling interests of less than
$1 million
.
|
|
Six Months
Ended June 30, |
||||||
|
2014
|
|
2013
|
||||
Net cash provided by (used in) operating activities
|
$
|
6,921
|
|
|
$
|
7,314
|
|
Cash flows from investing activities
|
|
|
|
||||
Sales, maturities and repayments of:
|
|
|
|
||||
Fixed maturity securities
|
56,794
|
|
|
64,674
|
|
||
Equity securities
|
320
|
|
|
449
|
|
||
Mortgage loans
|
6,557
|
|
|
5,033
|
|
||
Real estate and real estate joint ventures
|
385
|
|
|
271
|
|
||
Other limited partnership interests
|
383
|
|
|
510
|
|
||
Purchases of:
|
|
|
|
||||
Fixed maturity securities
|
(62,844
|
)
|
|
(65,745
|
)
|
||
Equity securities
|
(452
|
)
|
|
(644
|
)
|
||
Mortgage loans
|
(6,021
|
)
|
|
(4,826
|
)
|
||
Real estate and real estate joint ventures
|
(912
|
)
|
|
(721
|
)
|
||
Other limited partnership interests
|
(852
|
)
|
|
(926
|
)
|
||
Cash received in connection with freestanding derivatives
|
703
|
|
|
777
|
|
||
Cash paid in connection with freestanding derivatives
|
(2,003
|
)
|
|
(4,300
|
)
|
||
Sales of businesses, net of cash and cash equivalents disposed of $262 and $0, respectively
|
452
|
|
|
373
|
|
||
Sale of bank deposits
|
—
|
|
|
(6,395
|
)
|
||
Purchases of investments in insurance joint ventures
|
(249
|
)
|
|
—
|
|
||
Net change in policy loans
|
(5
|
)
|
|
(111
|
)
|
||
Net change in short-term investments
|
1,374
|
|
|
3,880
|
|
||
Net change in other invested assets
|
(220
|
)
|
|
(174
|
)
|
||
Other, net
|
(110
|
)
|
|
22
|
|
||
Net cash provided by (used in) investing activities
|
(6,700
|
)
|
|
(7,853
|
)
|
||
Cash flows from financing activities
|
|
|
|
||||
Policyholder account balances:
|
|
|
|
||||
Deposits
|
46,847
|
|
|
41,507
|
|
||
Withdrawals
|
(47,621
|
)
|
|
(45,852
|
)
|
||
Net change in payables for collateral under securities loaned and other transactions
|
2,891
|
|
|
(440
|
)
|
||
Net change in bank deposits
|
—
|
|
|
8
|
|
||
Net change in short-term debt
|
(75
|
)
|
|
—
|
|
||
Long-term debt issued
|
1,000
|
|
|
—
|
|
||
Long-term debt repaid
|
(2,484
|
)
|
|
(356
|
)
|
||
Treasury stock acquired in connection with share repurchases
|
(4
|
)
|
|
—
|
|
||
Dividends on preferred stock
|
(61
|
)
|
|
(61
|
)
|
||
Dividends on common stock
|
(706
|
)
|
|
(505
|
)
|
||
Other, net
|
(221
|
)
|
|
(91
|
)
|
||
Net cash provided by (used in) financing activities
|
(434
|
)
|
|
(5,790
|
)
|
||
Effect of change in foreign currency exchange rates on cash and cash equivalents balances
|
21
|
|
|
(225
|
)
|
||
Change in cash and cash equivalents
|
(192
|
)
|
|
(6,554
|
)
|
||
Cash and cash equivalents, beginning of period
|
7,585
|
|
|
15,738
|
|
||
Cash and cash equivalents, end of period
|
$
|
7,393
|
|
|
$
|
9,184
|
|
Supplemental disclosures of cash flow information
|
|
|
|
||||
Net cash paid (received) for:
|
|
|
|
||||
Interest
|
$
|
623
|
|
|
$
|
618
|
|
Income tax
|
$
|
332
|
|
|
$
|
444
|
|
Non-cash transactions:
|
|
|
|
||||
Real estate and real estate joint ventures acquired in satisfaction of debt
|
$
|
—
|
|
|
$
|
55
|
|
Dividends on common stock declared and unpaid
|
$
|
—
|
|
|
$
|
303
|
|
Deconsolidation of MetLife Core Property Fund (see Note 6):
|
|
|
|
||||
Reduction of redeemable noncontrolling interests
|
$
|
774
|
|
|
$
|
—
|
|
Reduction of long-term debt
|
$
|
413
|
|
|
$
|
—
|
|
Reduction of real estate and real estate joint ventures
|
$
|
1,132
|
|
|
$
|
—
|
|
•
|
Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to net investment gains (losses) and net derivative gains (losses) and certain variable annuity guaranteed minimum income benefits (“GMIBs”) fees (“GMIB Fees”);
|
•
|
Net investment income: (i) includes amounts for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment, (ii) includes income from discontinued real estate operations, (iii) excludes post-tax operating earnings adjustments relating to insurance joint ventures accounted for under the equity method, (iv) excludes certain amounts related to contractholder-directed unit-linked investments, and (v) excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and
|
•
|
Other revenues are adjusted for settlements of foreign currency earnings hedges.
|
•
|
Policyholder benefits and claims and policyholder dividends excludes: (i) changes in the policyholder dividend obligation related to net investment gains (losses) and net derivative gains (losses), (ii) inflation-indexed benefit adjustments associated with contracts backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass through adjustments, (iii) benefits and hedging costs related to GMIBs (“GMIB Costs”), and (iv) market value adjustments associated with surrenders or terminations of contracts (“Market Value Adjustments”);
|
•
|
Interest credited to policyholder account balances includes adjustments for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of policyholder account balances (“PABs”) but do not qualify for hedge accounting treatment and excludes amounts related to net investment income earned on contractholder-directed unit-linked investments;
|
•
|
Amortization of deferred policy acquisition costs (“DAC”) and value of business acquired (“VOBA”) excludes amounts related to: (i) net investment gains (losses) and net derivative gains (losses), (ii) GMIB Fees and GMIB Costs, and (iii) Market Value Adjustments;
|
•
|
Amortization of negative VOBA excludes amounts related to Market Value Adjustments;
|
•
|
Interest expense on debt excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and
|
•
|
Other expenses excludes costs related to: (i) noncontrolling interests, (ii) implementation of new insurance regulatory requirements, and (iii) acquisition and integration costs.
|
|
|
Operating Earnings
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Three Months Ended June 30, 2014
|
|
Retail
|
|
Group,
Voluntary & Worksite Benefits |
|
Corporate
Benefit Funding |
|
Latin
America |
|
Total
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other |
|
Total
|
|
Adjustments
|
|
Total
Consolidated |
||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Premiums
|
|
$
|
1,812
|
|
|
$
|
4,038
|
|
|
$
|
686
|
|
|
$
|
780
|
|
|
$
|
7,316
|
|
|
$
|
1,913
|
|
|
$
|
584
|
|
|
$
|
40
|
|
|
$
|
9,853
|
|
|
$
|
20
|
|
|
$
|
9,873
|
|
Universal life and investment-type product policy fees
|
|
1,256
|
|
|
181
|
|
|
55
|
|
|
317
|
|
|
1,809
|
|
|
400
|
|
|
117
|
|
|
34
|
|
|
2,360
|
|
|
98
|
|
|
2,458
|
|
|||||||||||
Net investment income
|
|
1,963
|
|
|
458
|
|
|
1,443
|
|
|
332
|
|
|
4,196
|
|
|
717
|
|
|
134
|
|
|
48
|
|
|
5,095
|
|
|
164
|
|
|
5,259
|
|
|||||||||||
Other revenues
|
|
265
|
|
|
104
|
|
|
75
|
|
|
9
|
|
|
453
|
|
|
24
|
|
|
11
|
|
|
5
|
|
|
493
|
|
|
(3
|
)
|
|
490
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(125
|
)
|
|
(125
|
)
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
311
|
|
|
311
|
|
|||||||||||
Total revenues
|
|
5,296
|
|
|
4,781
|
|
|
2,259
|
|
|
1,438
|
|
|
13,774
|
|
|
3,054
|
|
|
846
|
|
|
127
|
|
|
17,801
|
|
|
465
|
|
|
18,266
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
2,438
|
|
|
3,789
|
|
|
1,273
|
|
|
743
|
|
|
8,243
|
|
|
1,425
|
|
|
271
|
|
|
25
|
|
|
9,964
|
|
|
421
|
|
|
10,385
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
561
|
|
|
39
|
|
|
287
|
|
|
100
|
|
|
987
|
|
|
394
|
|
|
35
|
|
|
9
|
|
|
1,425
|
|
|
284
|
|
|
1,709
|
|
|||||||||||
Capitalization of DAC
|
|
(249
|
)
|
|
(36
|
)
|
|
(18
|
)
|
|
(93
|
)
|
|
(396
|
)
|
|
(457
|
)
|
|
(170
|
)
|
|
(8
|
)
|
|
(1,031
|
)
|
|
(1
|
)
|
|
(1,032
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
378
|
|
|
35
|
|
|
6
|
|
|
81
|
|
|
500
|
|
|
362
|
|
|
160
|
|
|
3
|
|
|
1,025
|
|
|
37
|
|
|
1,062
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(92
|
)
|
|
(6
|
)
|
|
—
|
|
|
(99
|
)
|
|
(12
|
)
|
|
(111
|
)
|
|||||||||||
Interest expense on debt
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
297
|
|
|
299
|
|
|
13
|
|
|
312
|
|
|||||||||||
Other expenses
|
|
1,177
|
|
|
638
|
|
|
134
|
|
|
412
|
|
|
2,361
|
|
|
976
|
|
|
446
|
|
|
196
|
|
|
3,979
|
|
|
12
|
|
|
3,991
|
|
|||||||||||
Total expenses
|
|
4,305
|
|
|
4,465
|
|
|
1,684
|
|
|
1,242
|
|
|
11,696
|
|
|
2,608
|
|
|
736
|
|
|
522
|
|
|
15,562
|
|
|
754
|
|
|
16,316
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
339
|
|
|
111
|
|
|
201
|
|
|
36
|
|
|
687
|
|
|
127
|
|
|
17
|
|
|
(213
|
)
|
|
618
|
|
|
(44
|
)
|
|
574
|
|
|||||||||||
Operating earnings
|
|
$
|
652
|
|
|
$
|
205
|
|
|
$
|
374
|
|
|
$
|
160
|
|
|
$
|
1,391
|
|
|
$
|
319
|
|
|
$
|
93
|
|
|
$
|
(182
|
)
|
|
1,621
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
465
|
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(754
|
)
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
44
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
1,376
|
|
|
|
|
$
|
1,376
|
|
|
|
Operating Earnings
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Three Months Ended June 30, 2013
|
|
Retail
|
|
Group,
Voluntary & Worksite Benefits |
|
Corporate
Benefit Funding |
|
Latin
America |
|
Total
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other |
|
Total
|
|
Adjustments
|
|
Total
Consolidated |
||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Premiums
|
|
$
|
1,581
|
|
|
$
|
3,797
|
|
|
$
|
503
|
|
|
$
|
710
|
|
|
$
|
6,591
|
|
|
$
|
1,980
|
|
|
$
|
558
|
|
|
$
|
28
|
|
|
$
|
9,157
|
|
|
$
|
1
|
|
|
$
|
9,158
|
|
Universal life and investment-type product policy fees
|
|
1,238
|
|
|
170
|
|
|
65
|
|
|
235
|
|
|
1,708
|
|
|
442
|
|
|
96
|
|
|
35
|
|
|
2,281
|
|
|
90
|
|
|
2,371
|
|
|||||||||||
Net investment income
|
|
1,987
|
|
|
472
|
|
|
1,402
|
|
|
281
|
|
|
4,142
|
|
|
723
|
|
|
120
|
|
|
72
|
|
|
5,057
|
|
|
225
|
|
|
5,282
|
|
|||||||||||
Other revenues
|
|
257
|
|
|
105
|
|
|
67
|
|
|
5
|
|
|
434
|
|
|
28
|
|
|
34
|
|
|
4
|
|
|
500
|
|
|
(10
|
)
|
|
490
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
110
|
|
|
110
|
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,690
|
)
|
|
(1,690
|
)
|
|||||||||||
Total revenues
|
|
5,063
|
|
|
4,544
|
|
|
2,037
|
|
|
1,231
|
|
|
12,875
|
|
|
3,173
|
|
|
808
|
|
|
139
|
|
|
16,995
|
|
|
(1,274
|
)
|
|
15,721
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
2,272
|
|
|
3,514
|
|
|
1,080
|
|
|
601
|
|
|
7,467
|
|
|
1,433
|
|
|
256
|
|
|
18
|
|
|
9,174
|
|
|
115
|
|
|
9,289
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
589
|
|
|
39
|
|
|
305
|
|
|
103
|
|
|
1,036
|
|
|
437
|
|
|
37
|
|
|
11
|
|
|
1,521
|
|
|
325
|
|
|
1,846
|
|
|||||||||||
Capitalization of DAC
|
|
(344
|
)
|
|
(35
|
)
|
|
(6
|
)
|
|
(108
|
)
|
|
(493
|
)
|
|
(522
|
)
|
|
(192
|
)
|
|
(5
|
)
|
|
(1,212
|
)
|
|
—
|
|
|
(1,212
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
396
|
|
|
33
|
|
|
6
|
|
|
83
|
|
|
518
|
|
|
392
|
|
|
195
|
|
|
—
|
|
|
1,105
|
|
|
(147
|
)
|
|
958
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(113
|
)
|
|
(11
|
)
|
|
—
|
|
|
(124
|
)
|
|
(14
|
)
|
|
(138
|
)
|
|||||||||||
Interest expense on debt
|
|
1
|
|
|
1
|
|
|
2
|
|
|
1
|
|
|
5
|
|
|
—
|
|
|
(1
|
)
|
|
283
|
|
|
287
|
|
|
34
|
|
|
321
|
|
|||||||||||
Other expenses
|
|
1,265
|
|
|
578
|
|
|
116
|
|
|
390
|
|
|
2,349
|
|
|
1,054
|
|
|
460
|
|
|
146
|
|
|
4,009
|
|
|
87
|
|
|
4,096
|
|
|||||||||||
Total expenses
|
|
4,179
|
|
|
4,130
|
|
|
1,503
|
|
|
1,070
|
|
|
10,882
|
|
|
2,681
|
|
|
744
|
|
|
453
|
|
|
14,760
|
|
|
400
|
|
|
15,160
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
303
|
|
|
139
|
|
|
188
|
|
|
36
|
|
|
666
|
|
|
162
|
|
|
(4
|
)
|
|
(205
|
)
|
|
619
|
|
|
(566
|
)
|
|
53
|
|
|||||||||||
Operating earnings
|
|
$
|
581
|
|
|
$
|
275
|
|
|
$
|
346
|
|
|
$
|
125
|
|
|
$
|
1,327
|
|
|
$
|
330
|
|
|
$
|
68
|
|
|
$
|
(109
|
)
|
|
1,616
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,274
|
)
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(400
|
)
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
566
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
508
|
|
|
|
|
$
|
508
|
|
|
|
Operating Earnings
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Six Months Ended June 30, 2014
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Total
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
|
Adjustments
|
|
Total
Consolidated
|
||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Premiums
|
|
$
|
3,536
|
|
|
$
|
8,040
|
|
|
$
|
987
|
|
|
$
|
1,448
|
|
|
$
|
14,011
|
|
|
$
|
3,803
|
|
|
$
|
1,181
|
|
|
$
|
75
|
|
|
$
|
19,070
|
|
|
$
|
22
|
|
|
$
|
19,092
|
|
Universal life and investment-type product policy fees
|
|
2,503
|
|
|
358
|
|
|
112
|
|
|
628
|
|
|
3,601
|
|
|
789
|
|
|
226
|
|
|
67
|
|
|
4,683
|
|
|
196
|
|
|
4,879
|
|
|||||||||||
Net investment income
|
|
3,977
|
|
|
911
|
|
|
2,853
|
|
|
657
|
|
|
8,398
|
|
|
1,410
|
|
|
257
|
|
|
115
|
|
|
10,180
|
|
|
114
|
|
|
10,294
|
|
|||||||||||
Other revenues
|
|
510
|
|
|
211
|
|
|
143
|
|
|
16
|
|
|
880
|
|
|
51
|
|
|
27
|
|
|
26
|
|
|
984
|
|
|
(16
|
)
|
|
968
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(536
|
)
|
|
(536
|
)
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
654
|
|
|
654
|
|
|||||||||||
Total revenues
|
|
10,526
|
|
|
9,520
|
|
|
4,095
|
|
|
2,749
|
|
|
26,890
|
|
|
6,053
|
|
|
1,691
|
|
|
283
|
|
|
34,917
|
|
|
434
|
|
|
35,351
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
4,845
|
|
|
7,570
|
|
|
2,161
|
|
|
1,347
|
|
|
15,923
|
|
|
2,822
|
|
|
532
|
|
|
60
|
|
|
19,337
|
|
|
675
|
|
|
20,012
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
1,116
|
|
|
79
|
|
|
565
|
|
|
198
|
|
|
1,958
|
|
|
781
|
|
|
69
|
|
|
18
|
|
|
2,826
|
|
|
352
|
|
|
3,178
|
|
|||||||||||
Capitalization of DAC
|
|
(483
|
)
|
|
(70
|
)
|
|
(19
|
)
|
|
(182
|
)
|
|
(754
|
)
|
|
(951
|
)
|
|
(346
|
)
|
|
(26
|
)
|
|
(2,077
|
)
|
|
(1
|
)
|
|
(2,078
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
807
|
|
|
71
|
|
|
10
|
|
|
160
|
|
|
1,048
|
|
|
700
|
|
|
324
|
|
|
3
|
|
|
2,075
|
|
|
45
|
|
|
2,120
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(186
|
)
|
|
(15
|
)
|
|
—
|
|
|
(202
|
)
|
|
(24
|
)
|
|
(226
|
)
|
|||||||||||
Interest expense on debt
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
589
|
|
|
593
|
|
|
31
|
|
|
624
|
|
|||||||||||
Other expenses
|
|
2,319
|
|
|
1,266
|
|
|
254
|
|
|
814
|
|
|
4,653
|
|
|
1,966
|
|
|
902
|
|
|
409
|
|
|
7,930
|
|
|
15
|
|
|
7,945
|
|
|||||||||||
Total expenses
|
|
8,604
|
|
|
8,916
|
|
|
2,975
|
|
|
2,336
|
|
|
22,831
|
|
|
5,132
|
|
|
1,466
|
|
|
1,053
|
|
|
30,482
|
|
|
1,093
|
|
|
31,575
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
658
|
|
|
211
|
|
|
391
|
|
|
70
|
|
|
1,330
|
|
|
274
|
|
|
44
|
|
|
(426
|
)
|
|
1,222
|
|
|
(164
|
)
|
|
1,058
|
|
|||||||||||
Operating earnings
|
|
$
|
1,264
|
|
|
$
|
393
|
|
|
$
|
729
|
|
|
$
|
343
|
|
|
$
|
2,729
|
|
|
$
|
647
|
|
|
$
|
181
|
|
|
$
|
(344
|
)
|
|
3,213
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
434
|
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,093
|
)
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
164
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
2,718
|
|
|
|
|
$
|
2,718
|
|
|
|
Operating Earnings
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Six Months Ended June 30, 2013
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Total
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
|
Adjustments
|
|
Total
Consolidated
|
||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Premiums
|
|
$
|
3,128
|
|
|
$
|
7,671
|
|
|
$
|
919
|
|
|
$
|
1,385
|
|
|
$
|
13,103
|
|
|
$
|
3,978
|
|
|
$
|
1,125
|
|
|
$
|
54
|
|
|
$
|
18,260
|
|
|
$
|
49
|
|
|
$
|
18,309
|
|
Universal life and investment-type product policy fees
|
|
2,405
|
|
|
350
|
|
|
133
|
|
|
460
|
|
|
3,348
|
|
|
886
|
|
|
187
|
|
|
71
|
|
|
4,492
|
|
|
170
|
|
|
4,662
|
|
|||||||||||
Net investment income
|
|
3,948
|
|
|
925
|
|
|
2,792
|
|
|
558
|
|
|
8,223
|
|
|
1,455
|
|
|
248
|
|
|
213
|
|
|
10,139
|
|
|
1,220
|
|
|
11,359
|
|
|||||||||||
Other revenues
|
|
500
|
|
|
213
|
|
|
140
|
|
|
9
|
|
|
862
|
|
|
41
|
|
|
61
|
|
|
17
|
|
|
981
|
|
|
(11
|
)
|
|
970
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
424
|
|
|
424
|
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,320
|
)
|
|
(2,320
|
)
|
|||||||||||
Total revenues
|
|
9,981
|
|
|
9,159
|
|
|
3,984
|
|
|
2,412
|
|
|
25,536
|
|
|
6,360
|
|
|
1,621
|
|
|
355
|
|
|
33,872
|
|
|
(468
|
)
|
|
33,404
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
4,425
|
|
|
7,154
|
|
|
2,097
|
|
|
1,155
|
|
|
14,831
|
|
|
2,848
|
|
|
493
|
|
|
27
|
|
|
18,199
|
|
|
798
|
|
|
18,997
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
1,168
|
|
|
78
|
|
|
648
|
|
|
207
|
|
|
2,101
|
|
|
879
|
|
|
72
|
|
|
23
|
|
|
3,075
|
|
|
1,361
|
|
|
4,436
|
|
|||||||||||
Capitalization of DAC
|
|
(718
|
)
|
|
(68
|
)
|
|
(23
|
)
|
|
(213
|
)
|
|
(1,022
|
)
|
|
(1,068
|
)
|
|
(369
|
)
|
|
(9
|
)
|
|
(2,468
|
)
|
|
—
|
|
|
(2,468
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
727
|
|
|
67
|
|
|
17
|
|
|
157
|
|
|
968
|
|
|
793
|
|
|
360
|
|
|
—
|
|
|
2,121
|
|
|
(339
|
)
|
|
1,782
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(226
|
)
|
|
(28
|
)
|
|
—
|
|
|
(255
|
)
|
|
(29
|
)
|
|
(284
|
)
|
|||||||||||
Interest expense on debt
|
|
1
|
|
|
1
|
|
|
4
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
569
|
|
|
575
|
|
|
67
|
|
|
642
|
|
|||||||||||
Other expenses
|
|
2,543
|
|
|
1,166
|
|
|
255
|
|
|
762
|
|
|
4,726
|
|
|
2,148
|
|
|
908
|
|
|
310
|
|
|
8,092
|
|
|
399
|
|
|
8,491
|
|
|||||||||||
Total expenses
|
|
8,146
|
|
|
8,398
|
|
|
2,998
|
|
|
2,067
|
|
|
21,609
|
|
|
5,374
|
|
|
1,436
|
|
|
920
|
|
|
29,339
|
|
|
2,257
|
|
|
31,596
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
628
|
|
|
256
|
|
|
346
|
|
|
77
|
|
|
1,307
|
|
|
323
|
|
|
30
|
|
|
(400
|
)
|
|
1,260
|
|
|
(955
|
)
|
|
305
|
|
|||||||||||
Operating earnings
|
|
$
|
1,207
|
|
|
$
|
505
|
|
|
$
|
640
|
|
|
$
|
268
|
|
|
$
|
2,620
|
|
|
$
|
663
|
|
|
$
|
155
|
|
|
$
|
(165
|
)
|
|
3,273
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(468
|
)
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,257
|
)
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
955
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
1,503
|
|
|
|
|
$
|
1,503
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
|
(In millions)
|
||||||
Retail
|
$
|
360,783
|
|
|
$
|
349,516
|
|
Group, Voluntary & Worksite Benefits
|
45,401
|
|
|
43,404
|
|
||
Corporate Benefit Funding
|
229,128
|
|
|
220,612
|
|
||
Latin America
|
74,437
|
|
|
69,874
|
|
||
Asia
|
124,475
|
|
|
119,717
|
|
||
EMEA
|
31,178
|
|
|
33,382
|
|
||
Corporate & Other
|
45,718
|
|
|
48,791
|
|
||
Total
|
$
|
911,120
|
|
|
$
|
885,296
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
In the
Event of Death
|
|
At
Annuitization
|
|
In the
Event of Death
|
|
At
Annuitization
|
||||||||
|
(In millions)
|
||||||||||||||
Annuity Contracts
(1)
|
|
|
|
|
|
|
|
||||||||
Variable Annuity Guarantees
|
|
|
|
|
|
|
|
||||||||
Total contract account value (2)
|
$
|
204,027
|
|
|
$
|
102,857
|
|
|
$
|
201,395
|
|
|
$
|
100,527
|
|
Separate account value
|
$
|
168,187
|
|
|
$
|
98,901
|
|
|
$
|
164,500
|
|
|
$
|
96,459
|
|
Net amount at risk
|
$
|
3,917
|
|
|
$
|
1,382
|
|
|
$
|
4,203
|
|
|
$
|
1,219
|
|
Average attained age of contractholders
|
64 years
|
|
|
64 years
|
|
|
63 years
|
|
|
63 years
|
|
||||
Two Tier Annuities
|
|
|
|
|
|
|
|
||||||||
General account value
|
N/A
|
|
|
$
|
1,025
|
|
|
N/A
|
|
|
$
|
880
|
|
||
Net amount at risk
|
N/A
|
|
|
$
|
311
|
|
|
N/A
|
|
|
$
|
234
|
|
||
Average attained age of contractholders
|
N/A
|
|
|
50 years
|
|
|
N/A
|
|
|
50 years
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Secondary
Guarantees
|
|
Paid-Up
Guarantees
|
|
Secondary
Guarantees
|
|
Paid-Up
Guarantees
|
||||||||
|
(In millions)
|
||||||||||||||
Universal and Variable Life Contracts
(1)
|
|
|
|
|
|
|
|
||||||||
Account value (general and separate account)
|
$
|
16,468
|
|
|
$
|
3,640
|
|
|
$
|
16,048
|
|
|
$
|
3,700
|
|
Net amount at risk
|
$
|
183,942
|
|
|
$
|
21,020
|
|
|
$
|
185,920
|
|
|
$
|
21,737
|
|
Average attained age of policyholders
|
56 years
|
|
|
61 years
|
|
|
55 years
|
|
|
60 years
|
|
(1)
|
The Company’s annuity and life contracts with guarantees may offer more than one type of guarantee in each contract. Therefore, the amounts listed above may not be mutually exclusive.
|
(2)
|
Includes amounts, which are not reported on the consolidated balance sheets, from assumed reinsurance of certain variable annuity products from the Company’s former operating joint venture in Japan.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
|
(In millions)
|
||||||
Closed Block Liabilities
|
|
|
|
||||
Future policy benefits
|
$
|
41,795
|
|
|
$
|
42,076
|
|
Other policy-related balances
|
331
|
|
|
298
|
|
||
Policyholder dividends payable
|
477
|
|
|
456
|
|
||
Policyholder dividend obligation
|
2,986
|
|
|
1,771
|
|
||
Current income tax payable
|
18
|
|
|
18
|
|
||
Other liabilities
|
641
|
|
|
582
|
|
||
Total closed block liabilities
|
46,248
|
|
|
45,201
|
|
||
Assets Designated to the Closed Block
|
|
|
|
||||
Investments:
|
|
|
|
||||
Fixed maturity securities available-for-sale, at estimated fair value
|
29,295
|
|
|
28,374
|
|
||
Equity securities available-for-sale, at estimated fair value
|
90
|
|
|
86
|
|
||
Mortgage loans
|
6,031
|
|
|
6,155
|
|
||
Policy loans
|
4,651
|
|
|
4,669
|
|
||
Real estate and real estate joint ventures
|
543
|
|
|
492
|
|
||
Other invested assets
|
997
|
|
|
814
|
|
||
Total investments
|
41,607
|
|
|
40,590
|
|
||
Cash and cash equivalents
|
311
|
|
|
238
|
|
||
Accrued investment income
|
495
|
|
|
477
|
|
||
Premiums, reinsurance and other receivables
|
95
|
|
|
98
|
|
||
Deferred income tax assets
|
294
|
|
|
293
|
|
||
Total assets designated to the closed block
|
42,802
|
|
|
41,696
|
|
||
Excess of closed block liabilities over assets designated to the closed block
|
3,446
|
|
|
3,505
|
|
||
Amounts included in accumulated other comprehensive income (loss) (“AOCI”)
|
|
|
|
||||
Unrealized investment gains (losses), net of income tax
|
2,254
|
|
|
1,502
|
|
||
Unrealized gains (losses) on derivatives, net of income tax
|
(5
|
)
|
|
(3
|
)
|
||
Allocated to policyholder dividend obligation, net of income tax
|
(1,941
|
)
|
|
(1,151
|
)
|
||
Total amounts included in AOCI
|
308
|
|
|
348
|
|
||
Maximum future earnings to be recognized from closed block assets and liabilities
|
$
|
3,754
|
|
|
$
|
3,853
|
|
|
|
Six Months
Ended June 30, 2014 |
|
Year
Ended December 31, 2013 |
||||
|
|
(In millions)
|
||||||
Balance, beginning of period
|
|
$
|
1,771
|
|
|
$
|
3,828
|
|
Change in unrealized investment and derivative gains (losses)
|
|
1,215
|
|
|
(2,057
|
)
|
||
Balance, end of period
|
|
$
|
2,986
|
|
|
$
|
1,771
|
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
||||||||
Premiums
|
|
$
|
473
|
|
|
$
|
489
|
|
|
$
|
919
|
|
|
$
|
953
|
|
Net investment income
|
|
522
|
|
|
529
|
|
|
1,052
|
|
|
1,062
|
|
||||
Net investment gains (losses)
|
|
8
|
|
|
24
|
|
|
8
|
|
|
27
|
|
||||
Net derivative gains (losses)
|
|
(3
|
)
|
|
7
|
|
|
(4
|
)
|
|
15
|
|
||||
Total revenues
|
|
1,000
|
|
|
1,049
|
|
|
1,975
|
|
|
2,057
|
|
||||
Expenses
|
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims
|
|
645
|
|
|
669
|
|
|
1,269
|
|
|
1,312
|
|
||||
Policyholder dividends
|
|
243
|
|
|
247
|
|
|
476
|
|
|
489
|
|
||||
Other expenses
|
|
38
|
|
|
43
|
|
|
79
|
|
|
85
|
|
||||
Total expenses
|
|
926
|
|
|
959
|
|
|
1,824
|
|
|
1,886
|
|
||||
Revenues, net of expenses before provision for income tax expense (benefit)
|
|
74
|
|
|
90
|
|
|
151
|
|
|
171
|
|
||||
Provision for income tax expense (benefit)
|
|
26
|
|
|
33
|
|
|
53
|
|
|
60
|
|
||||
Revenues, net of expenses and provision for income tax expense (benefit)
|
|
$
|
48
|
|
|
$
|
57
|
|
|
$
|
98
|
|
|
$
|
111
|
|
|
June 30, 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
|
$
|
99,550
|
|
|
$
|
10,311
|
|
|
$
|
468
|
|
|
$
|
—
|
|
|
$
|
109,393
|
|
|
$
|
100,203
|
|
|
$
|
7,495
|
|
|
$
|
1,229
|
|
|
$
|
—
|
|
|
$
|
106,469
|
|
Foreign corporate
|
57,557
|
|
|
5,118
|
|
|
187
|
|
|
—
|
|
|
62,488
|
|
|
59,778
|
|
|
3,939
|
|
|
565
|
|
|
—
|
|
|
63,152
|
|
||||||||||
Foreign government
|
51,794
|
|
|
5,019
|
|
|
186
|
|
|
—
|
|
|
56,627
|
|
|
50,717
|
|
|
4,107
|
|
|
387
|
|
|
—
|
|
|
54,437
|
|
||||||||||
U.S. Treasury and agency
|
50,310
|
|
|
4,194
|
|
|
157
|
|
|
—
|
|
|
54,347
|
|
|
43,928
|
|
|
2,251
|
|
|
1,056
|
|
|
—
|
|
|
45,123
|
|
||||||||||
RMBS
|
37,344
|
|
|
2,082
|
|
|
259
|
|
|
103
|
|
|
39,064
|
|
|
34,167
|
|
|
1,584
|
|
|
490
|
|
|
206
|
|
|
35,055
|
|
||||||||||
CMBS
|
15,119
|
|
|
582
|
|
|
50
|
|
|
—
|
|
|
15,651
|
|
|
16,115
|
|
|
605
|
|
|
170
|
|
|
—
|
|
|
16,550
|
|
||||||||||
ABS
|
14,558
|
|
|
306
|
|
|
69
|
|
|
7
|
|
|
14,788
|
|
|
15,458
|
|
|
296
|
|
|
171
|
|
|
12
|
|
|
15,571
|
|
||||||||||
State and political subdivision
|
13,055
|
|
|
1,729
|
|
|
86
|
|
|
—
|
|
|
14,698
|
|
|
13,233
|
|
|
903
|
|
|
306
|
|
|
—
|
|
|
13,830
|
|
||||||||||
Total fixed maturity securities
|
$
|
339,287
|
|
|
$
|
29,341
|
|
|
$
|
1,462
|
|
|
$
|
110
|
|
|
$
|
367,056
|
|
|
$
|
333,599
|
|
|
$
|
21,180
|
|
|
$
|
4,374
|
|
|
$
|
218
|
|
|
$
|
350,187
|
|
Equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Common stock
|
$
|
2,138
|
|
|
$
|
573
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
2,707
|
|
|
$
|
1,927
|
|
|
$
|
431
|
|
|
$
|
5
|
|
|
$
|
—
|
|
|
$
|
2,353
|
|
Non-redeemable preferred stock
|
1,114
|
|
|
82
|
|
|
40
|
|
|
—
|
|
|
1,156
|
|
|
1,085
|
|
|
76
|
|
|
112
|
|
|
—
|
|
|
1,049
|
|
||||||||||
Total equity securities
|
$
|
3,252
|
|
|
$
|
655
|
|
|
$
|
44
|
|
|
$
|
—
|
|
|
$
|
3,863
|
|
|
$
|
3,012
|
|
|
$
|
507
|
|
|
$
|
117
|
|
|
$
|
—
|
|
|
$
|
3,402
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
||||||||
|
(In millions)
|
||||||||||||||
Due in one year or less
|
$
|
14,242
|
|
|
$
|
14,480
|
|
|
$
|
15,828
|
|
|
$
|
16,030
|
|
Due after one year through five years
|
77,029
|
|
|
81,202
|
|
|
70,467
|
|
|
74,229
|
|
||||
Due after five years through ten years
|
78,643
|
|
|
85,648
|
|
|
78,159
|
|
|
83,223
|
|
||||
Due after ten years
|
102,352
|
|
|
116,223
|
|
|
103,405
|
|
|
109,529
|
|
||||
Subtotal
|
272,266
|
|
|
297,553
|
|
|
267,859
|
|
|
283,011
|
|
||||
Structured securities (RMBS, CMBS and ABS)
|
67,021
|
|
|
69,503
|
|
|
65,740
|
|
|
67,176
|
|
||||
Total fixed maturity securities
|
$
|
339,287
|
|
|
$
|
367,056
|
|
|
$
|
333,599
|
|
|
$
|
350,187
|
|
|
June 30, 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
|
$
|
4,041
|
|
|
$
|
59
|
|
|
$
|
7,002
|
|
|
$
|
409
|
|
|
$
|
13,889
|
|
|
$
|
808
|
|
|
$
|
3,807
|
|
|
$
|
421
|
|
Foreign corporate
|
2,781
|
|
|
70
|
|
|
2,822
|
|
|
117
|
|
|
9,019
|
|
|
402
|
|
|
2,320
|
|
|
163
|
|
||||||||
Foreign government
|
2,226
|
|
|
54
|
|
|
1,955
|
|
|
132
|
|
|
5,052
|
|
|
336
|
|
|
1,846
|
|
|
51
|
|
||||||||
U.S. Treasury and agency
|
4,865
|
|
|
6
|
|
|
5,673
|
|
|
151
|
|
|
15,225
|
|
|
1,037
|
|
|
357
|
|
|
19
|
|
||||||||
RMBS
|
1,640
|
|
|
77
|
|
|
4,162
|
|
|
285
|
|
|
10,754
|
|
|
363
|
|
|
2,302
|
|
|
333
|
|
||||||||
CMBS
|
860
|
|
|
20
|
|
|
1,076
|
|
|
30
|
|
|
3,696
|
|
|
142
|
|
|
631
|
|
|
28
|
|
||||||||
ABS
|
2,845
|
|
|
17
|
|
|
786
|
|
|
59
|
|
|
3,772
|
|
|
59
|
|
|
978
|
|
|
124
|
|
||||||||
State and political subdivision
|
155
|
|
|
2
|
|
|
1,214
|
|
|
84
|
|
|
3,109
|
|
|
225
|
|
|
351
|
|
|
81
|
|
||||||||
Total fixed maturity securities
|
$
|
19,413
|
|
|
$
|
305
|
|
|
$
|
24,690
|
|
|
$
|
1,267
|
|
|
$
|
64,516
|
|
|
$
|
3,372
|
|
|
$
|
12,592
|
|
|
$
|
1,220
|
|
Equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common stock
|
$
|
90
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
81
|
|
|
$
|
4
|
|
|
$
|
16
|
|
|
$
|
1
|
|
Non-redeemable preferred stock
|
68
|
|
|
2
|
|
|
348
|
|
|
38
|
|
|
364
|
|
|
65
|
|
|
191
|
|
|
47
|
|
||||||||
Total equity securities
|
$
|
158
|
|
|
$
|
6
|
|
|
$
|
348
|
|
|
$
|
38
|
|
|
$
|
445
|
|
|
$
|
69
|
|
|
$
|
207
|
|
|
$
|
48
|
|
Total number of securities in an unrealized loss position
|
1,611
|
|
|
|
|
1,853
|
|
|
|
|
4,480
|
|
|
|
|
1,571
|
|
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||
|
Carrying
Value
|
|
% of
Total
|
|
Carrying
Value
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Mortgage loans held-for-investment:
|
|
|
|
|
|
|
|
||||||
Commercial
|
$
|
40,604
|
|
|
71.0
|
%
|
|
$
|
40,926
|
|
|
70.9
|
%
|
Agricultural
|
11,961
|
|
|
20.9
|
|
|
12,391
|
|
|
21.5
|
|
||
Residential
|
3,947
|
|
|
6.9
|
|
|
2,772
|
|
|
4.8
|
|
||
Subtotal (1)
|
56,512
|
|
|
98.8
|
|
|
56,089
|
|
|
97.2
|
|
||
Valuation allowances
|
(294
|
)
|
|
(0.5
|
)
|
|
(322
|
)
|
|
(0.6
|
)
|
||
Subtotal mortgage loans held-for-investment, net
|
56,218
|
|
|
98.3
|
|
|
55,767
|
|
|
96.6
|
|
||
Residential — fair value option (“FVO”)
|
367
|
|
|
0.6
|
|
|
338
|
|
|
0.6
|
|
||
Commercial mortgage loans held by CSEs
—
FVO
|
638
|
|
|
1.1
|
|
|
1,598
|
|
|
2.8
|
|
||
Total mortgage loans held-for-investment, net
|
57,223
|
|
|
100.0
|
|
|
57,703
|
|
|
100.0
|
|
||
Mortgage loans held-for-sale
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||
Total mortgage loans, net
|
$
|
57,223
|
|
|
100.0
|
%
|
|
$
|
57,706
|
|
|
100.0
|
%
|
(1)
|
Purchases of mortgage loans were
$818 million
and
$1.4 billion
for the three months and
six months ended
June 30, 2014
, respectively. Purchases of mortgage loans were
$836 million
and
$886 million
for the three months and
six months ended
June 30, 2013
, respectively.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||||||||||||
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Mortgage loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Evaluated individually for credit losses
|
$
|
415
|
|
|
$
|
75
|
|
|
$
|
9
|
|
|
$
|
499
|
|
|
$
|
506
|
|
|
$
|
100
|
|
|
$
|
16
|
|
|
$
|
622
|
|
Evaluated collectively for credit losses
|
40,189
|
|
|
11,886
|
|
|
3,938
|
|
|
56,013
|
|
|
40,420
|
|
|
12,291
|
|
|
2,756
|
|
|
55,467
|
|
||||||||
Total mortgage loans
|
40,604
|
|
|
11,961
|
|
|
3,947
|
|
|
56,512
|
|
|
40,926
|
|
|
12,391
|
|
|
2,772
|
|
|
56,089
|
|
||||||||
Valuation allowances:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Specific credit losses
|
33
|
|
|
6
|
|
|
—
|
|
|
39
|
|
|
58
|
|
|
7
|
|
|
1
|
|
|
66
|
|
||||||||
Non-specifically identified credit losses
|
197
|
|
|
36
|
|
|
22
|
|
|
255
|
|
|
200
|
|
|
37
|
|
|
19
|
|
|
256
|
|
||||||||
Total valuation allowances
|
230
|
|
|
42
|
|
|
22
|
|
|
294
|
|
|
258
|
|
|
44
|
|
|
20
|
|
|
322
|
|
||||||||
Mortgage loans, net of valuation allowance
|
$
|
40,374
|
|
|
$
|
11,919
|
|
|
$
|
3,925
|
|
|
$
|
56,218
|
|
|
$
|
40,668
|
|
|
$
|
12,347
|
|
|
$
|
2,752
|
|
|
$
|
55,767
|
|
|
Three Months
Ended June 30, |
||||||||||||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||||||||||||
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Balance, beginning of period
|
$
|
259
|
|
|
$
|
42
|
|
|
$
|
25
|
|
|
$
|
326
|
|
|
$
|
275
|
|
|
$
|
54
|
|
|
$
|
3
|
|
|
$
|
332
|
|
Provision (release)
|
(5
|
)
|
|
—
|
|
|
(3
|
)
|
|
(8
|
)
|
|
(33
|
)
|
|
1
|
|
|
8
|
|
|
(24
|
)
|
||||||||
Charge-offs, net of recoveries
|
(24
|
)
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
||||||||
Balance, end of period
|
$
|
230
|
|
|
$
|
42
|
|
|
$
|
22
|
|
|
$
|
294
|
|
|
$
|
242
|
|
|
$
|
49
|
|
|
$
|
11
|
|
|
$
|
302
|
|
|
Six Months
Ended June 30, |
||||||||||||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||||||||||||
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Balance, beginning of period
|
$
|
258
|
|
|
$
|
44
|
|
|
$
|
20
|
|
|
$
|
322
|
|
|
$
|
293
|
|
|
$
|
52
|
|
|
$
|
2
|
|
|
$
|
347
|
|
Provision (release)
|
(4
|
)
|
|
(2
|
)
|
|
3
|
|
|
(3
|
)
|
|
(51
|
)
|
|
7
|
|
|
9
|
|
|
(35
|
)
|
||||||||
Charge-offs, net of recoveries
|
(24
|
)
|
|
—
|
|
|
(1
|
)
|
|
(25
|
)
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
(10
|
)
|
||||||||
Balance, end of period
|
$
|
230
|
|
|
$
|
42
|
|
|
$
|
22
|
|
|
$
|
294
|
|
|
$
|
242
|
|
|
$
|
49
|
|
|
$
|
11
|
|
|
$
|
302
|
|
|
Recorded Investment
|
|
Estimated
Fair Value
|
|
% of
Total
|
||||||||||||||||||||
|
Debt Service Coverage Ratios
|
|
|
|
% of
Total
|
|
|||||||||||||||||||
|
> 1.20x
|
|
1.00x - 1.20x
|
|
< 1.00x
|
|
Total
|
|
|||||||||||||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||||||||||||||
June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loan-to-value ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 65%
|
$
|
31,658
|
|
|
$
|
587
|
|
|
$
|
534
|
|
|
$
|
32,779
|
|
|
80.7
|
%
|
|
$
|
34,876
|
|
|
81.5
|
%
|
65% to 75%
|
5,513
|
|
|
498
|
|
|
57
|
|
|
6,068
|
|
|
15.0
|
|
|
6,206
|
|
|
14.5
|
|
|||||
76% to 80%
|
548
|
|
|
212
|
|
|
57
|
|
|
817
|
|
|
2.0
|
|
|
816
|
|
|
1.9
|
|
|||||
Greater than 80%
|
424
|
|
|
303
|
|
|
213
|
|
|
940
|
|
|
2.3
|
|
|
909
|
|
|
2.1
|
|
|||||
Total
|
$
|
38,143
|
|
|
$
|
1,600
|
|
|
$
|
861
|
|
|
$
|
40,604
|
|
|
100.0
|
%
|
|
$
|
42,807
|
|
|
100.0
|
%
|
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loan-to-value ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 65%
|
$
|
30,552
|
|
|
$
|
614
|
|
|
$
|
841
|
|
|
$
|
32,007
|
|
|
78.2
|
%
|
|
$
|
33,519
|
|
|
78.9
|
%
|
65% to 75%
|
6,360
|
|
|
438
|
|
|
149
|
|
|
6,947
|
|
|
17.0
|
|
|
7,039
|
|
|
16.6
|
|
|||||
76% to 80%
|
525
|
|
|
192
|
|
|
189
|
|
|
906
|
|
|
2.2
|
|
|
892
|
|
|
2.1
|
|
|||||
Greater than 80%
|
661
|
|
|
242
|
|
|
163
|
|
|
1,066
|
|
|
2.6
|
|
|
1,006
|
|
|
2.4
|
|
|||||
Total
|
$
|
38,098
|
|
|
$
|
1,486
|
|
|
$
|
1,342
|
|
|
$
|
40,926
|
|
|
100.0
|
%
|
|
$
|
42,456
|
|
|
100.0
|
%
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||
|
Recorded
Investment
|
|
% of
Total
|
|
Recorded
Investment
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Loan-to-value ratios:
|
|
|
|
|
|
|
|
||||||
Less than 65%
|
$
|
11,277
|
|
|
94.3
|
%
|
|
$
|
11,461
|
|
|
92.5
|
%
|
65% to 75%
|
552
|
|
|
4.6
|
|
|
729
|
|
|
5.9
|
|
||
76% to 80%
|
40
|
|
|
0.3
|
|
|
84
|
|
|
0.7
|
|
||
Greater than 80%
|
92
|
|
|
0.8
|
|
|
117
|
|
|
0.9
|
|
||
Total
|
$
|
11,961
|
|
|
100.0
|
%
|
|
$
|
12,391
|
|
|
100.0
|
%
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||
|
Recorded
Investment
|
|
% of
Total
|
|
Recorded
Investment
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Performance indicators:
|
|
|
|
|
|
|
|
||||||
Performing
|
$
|
3,847
|
|
|
97.5
|
%
|
|
$
|
2,693
|
|
|
97.1
|
%
|
Nonperforming
|
100
|
|
|
2.5
|
|
|
79
|
|
|
2.9
|
|
||
Total
|
$
|
3,947
|
|
|
100.0
|
%
|
|
$
|
2,772
|
|
|
100.0
|
%
|
|
Past Due
|
|
Greater than 90 Days Past Due
and Still Accruing Interest
|
|
Nonaccrual Status
|
||||||||||||||||||
|
June 30, 2014
|
|
December 31, 2013
|
|
June 30, 2014
|
|
December 31, 2013
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Commercial
|
$
|
12
|
|
|
$
|
12
|
|
|
$
|
12
|
|
|
$
|
12
|
|
|
$
|
113
|
|
|
$
|
191
|
|
Agricultural
|
45
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
46
|
|
|
47
|
|
||||||
Residential
|
100
|
|
|
79
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|
65
|
|
||||||
Total
|
$
|
157
|
|
|
$
|
135
|
|
|
$
|
12
|
|
|
$
|
12
|
|
|
$
|
248
|
|
|
$
|
303
|
|
|
Loans with a Valuation Allowance
|
|
Loans without
a Valuation Allowance
|
|
All Impaired Loans
|
||||||||||||||||||||||||||
|
Unpaid
Principal
Balance
|
|
Recorded
Investment
|
|
Valuation
Allowances
|
|
Carrying
Value
|
|
Unpaid
Principal
Balance
|
|
Recorded
Investment
|
|
Unpaid
Principal
Balance
|
|
Carrying
Value
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial
|
$
|
132
|
|
|
$
|
132
|
|
|
$
|
33
|
|
|
$
|
99
|
|
|
$
|
285
|
|
|
$
|
283
|
|
|
$
|
417
|
|
|
$
|
382
|
|
Agricultural
|
55
|
|
|
53
|
|
|
6
|
|
|
47
|
|
|
23
|
|
|
22
|
|
|
78
|
|
|
69
|
|
||||||||
Residential
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
9
|
|
|
12
|
|
|
9
|
|
||||||||
Total
|
$
|
187
|
|
|
$
|
185
|
|
|
$
|
39
|
|
|
$
|
146
|
|
|
$
|
320
|
|
|
$
|
314
|
|
|
$
|
507
|
|
|
$
|
460
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial
|
$
|
214
|
|
|
$
|
210
|
|
|
$
|
58
|
|
|
$
|
152
|
|
|
$
|
299
|
|
|
$
|
296
|
|
|
$
|
513
|
|
|
$
|
448
|
|
Agricultural
|
68
|
|
|
66
|
|
|
7
|
|
|
59
|
|
|
35
|
|
|
34
|
|
|
103
|
|
|
93
|
|
||||||||
Residential
|
12
|
|
|
12
|
|
|
1
|
|
|
11
|
|
|
5
|
|
|
4
|
|
|
17
|
|
|
15
|
|
||||||||
Total
|
$
|
294
|
|
|
$
|
288
|
|
|
$
|
66
|
|
|
$
|
222
|
|
|
$
|
339
|
|
|
$
|
334
|
|
|
$
|
633
|
|
|
$
|
556
|
|
|
Impaired Mortgage Loans
|
||||||||||||||||||||||||||||||
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||||||||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||||||||||||||
|
Average
Recorded
Investment
|
|
Interest
Income
|
|
Average
Recorded
Investment
|
|
Interest
Income
|
|
Average
Recorded
Investment
|
|
Interest
Income
|
|
Average
Recorded
Investment
|
|
Interest
Income
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Commercial
|
$
|
462
|
|
|
$
|
4
|
|
|
$
|
531
|
|
|
$
|
4
|
|
|
$
|
476
|
|
|
$
|
7
|
|
|
$
|
534
|
|
|
$
|
7
|
|
Agricultural
|
88
|
|
|
3
|
|
|
158
|
|
|
2
|
|
|
92
|
|
|
6
|
|
|
165
|
|
|
3
|
|
||||||||
Residential
|
9
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
12
|
|
|
—
|
|
|
14
|
|
|
—
|
|
||||||||
Total
|
$
|
559
|
|
|
$
|
7
|
|
|
$
|
703
|
|
|
$
|
6
|
|
|
$
|
580
|
|
|
$
|
13
|
|
|
$
|
713
|
|
|
$
|
10
|
|
|
Three Months
Ended June 30, |
||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||
|
Number of
Mortgage Loans |
|
Carrying Value after Specific
Valuation Allowance |
|
Number of
Mortgage Loans |
|
Carrying Value after Specific
Valuation Allowance |
||||||||||||||
|
|
|
Pre-Modification
|
|
Post-Modification
|
|
|
|
Pre-Modification
|
|
Post-Modification
|
||||||||||
|
|
|
(In millions)
|
|
|
|
(In millions)
|
||||||||||||||
Commercial
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Agricultural
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
4
|
|
|
4
|
|
||||
Residential
|
17
|
|
|
3
|
|
|
2
|
|
|
6
|
|
|
1
|
|
|
1
|
|
||||
Total
|
18
|
|
|
$
|
4
|
|
|
$
|
3
|
|
|
7
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
Six Months
Ended June 30, |
||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||
|
Number of
Mortgage Loans |
|
Carrying Value after Specific
Valuation Allowance |
|
Number of
Mortgage Loans |
|
Carrying Value after Specific
Valuation Allowance |
||||||||||||||
|
|
|
Pre-Modification
|
|
Post-Modification
|
|
|
|
Pre-Modification
|
|
Post-Modification
|
||||||||||
|
|
|
(In millions)
|
|
|
|
(In millions)
|
||||||||||||||
Commercial
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Agricultural
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
4
|
|
|
4
|
|
||||
Residential
|
44
|
|
|
9
|
|
|
7
|
|
|
6
|
|
|
1
|
|
|
1
|
|
||||
Total
|
45
|
|
|
$
|
10
|
|
|
$
|
8
|
|
|
7
|
|
|
$
|
5
|
|
|
$
|
5
|
|
|
Three Months
Ended June 30, |
||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||
|
Number of
Mortgage Loans |
|
Carrying Value
|
|
Number of
Mortgage Loans |
|
Carrying Value
|
||||||||||
|
|
|
(In millions)
|
|
|
|
(In millions)
|
||||||||||
Commercial
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
||||
Agricultural
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Residential (1)
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
2
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
Six Months
Ended June 30, |
||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||
|
Number of
Mortgage Loans |
|
Carrying Value
|
|
Number of
Mortgage Loans |
|
Carrying Value
|
||||||||||
|
|
|
(In millions)
|
|
|
|
(In millions)
|
||||||||||
Commercial
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
||||
Agricultural
|
2
|
|
|
24
|
|
|
—
|
|
|
—
|
|
||||||
Residential (1)
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
4
|
|
|
$
|
24
|
|
|
—
|
|
|
$
|
—
|
|
(1)
|
Residential mortgage loans for the
three months
and
six months ended
June 30, 2014
had a carrying value of less than
$1 million
.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
|
(In millions)
|
||||||
Fixed maturity securities
|
$
|
27,769
|
|
|
$
|
16,672
|
|
Fixed maturity securities with noncredit OTTI losses in AOCI
|
(110
|
)
|
|
(218
|
)
|
||
Total fixed maturity securities
|
27,659
|
|
|
16,454
|
|
||
Equity securities
|
631
|
|
|
390
|
|
||
Derivatives
|
737
|
|
|
375
|
|
||
Other
|
(12
|
)
|
|
(73
|
)
|
||
Subtotal
|
29,015
|
|
|
17,146
|
|
||
Amounts allocated from:
|
|
|
|
||||
Insurance liability loss recognition
|
(1,980
|
)
|
|
(898
|
)
|
||
DAC and VOBA related to noncredit OTTI losses recognized in AOCI
|
1
|
|
|
6
|
|
||
DAC and VOBA
|
(1,881
|
)
|
|
(1,190
|
)
|
||
Policyholder dividend obligation
|
(2,986
|
)
|
|
(1,771
|
)
|
||
Subtotal
|
(6,846
|
)
|
|
(3,853
|
)
|
||
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI
|
39
|
|
|
73
|
|
||
Deferred income tax benefit (expense)
|
(7,826
|
)
|
|
(4,956
|
)
|
||
Net unrealized investment gains (losses)
|
14,382
|
|
|
8,410
|
|
||
Net unrealized investment gains (losses) attributable to noncontrolling interests
|
3
|
|
|
4
|
|
||
Net unrealized investment gains (losses) attributable to MetLife, Inc.
|
$
|
14,385
|
|
|
$
|
8,414
|
|
|
Six Months
Ended June 30, 2014 |
|
Year
Ended December 31, 2013 |
||||
|
(In millions)
|
||||||
Balance, beginning of period
|
$
|
(218
|
)
|
|
$
|
(361
|
)
|
Noncredit OTTI losses and subsequent changes recognized (1)
|
2
|
|
|
60
|
|
||
Securities sold with previous noncredit OTTI loss
|
25
|
|
|
149
|
|
||
Subsequent changes in estimated fair value
|
81
|
|
|
(66
|
)
|
||
Balance, end of period
|
$
|
(110
|
)
|
|
$
|
(218
|
)
|
(1)
|
Noncredit OTTI losses and subsequent changes recognized, net of DAC, were
($6) million
and
$52 million
for the
six months ended
June 30, 2014
and the year ended
December 31, 2013
, respectively.
|
|
Six Months
Ended June 30, 2014 |
||
|
(In millions)
|
||
Balance, beginning of period
|
$
|
8,414
|
|
Fixed maturity securities on which noncredit OTTI losses have been recognized
|
108
|
|
|
Unrealized investment gains (losses) during the period
|
11,761
|
|
|
Unrealized investment gains (losses) relating to:
|
|
||
Insurance liability gain (loss) recognition
|
(1,082
|
)
|
|
DAC and VOBA related to noncredit OTTI losses recognized in AOCI
|
(5
|
)
|
|
DAC and VOBA
|
(691
|
)
|
|
Policyholder dividend obligation
|
(1,215
|
)
|
|
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI
|
(34
|
)
|
|
Deferred income tax benefit (expense)
|
(2,870
|
)
|
|
Net unrealized investment gains (losses)
|
14,386
|
|
|
Net unrealized investment gains (losses) attributable to noncontrolling interests
|
(1
|
)
|
|
Balance, end of period
|
$
|
14,385
|
|
Change in net unrealized investment gains (losses)
|
$
|
5,972
|
|
Change in net unrealized investment gains (losses) attributable to noncontrolling interests
|
(1
|
)
|
|
Change in net unrealized investment gains (losses) attributable to MetLife, Inc.
|
$
|
5,971
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
|
(In millions)
|
||||||
Securities on loan: (1)
|
|
|
|
||||
Amortized cost
|
$
|
28,356
|
|
|
$
|
27,094
|
|
Estimated fair value
|
$
|
30,355
|
|
|
$
|
27,595
|
|
Cash collateral on deposit from counterparties (2)
|
$
|
30,910
|
|
|
$
|
28,319
|
|
Security collateral on deposit from counterparties (3)
|
$
|
85
|
|
|
$
|
—
|
|
Reinvestment portfolio — estimated fair value
|
$
|
31,396
|
|
|
$
|
28,481
|
|
(1)
|
Included within fixed maturity securities, short-term investments, equity securities and cash and cash equivalents.
|
(2)
|
Included within payables for collateral under securities loaned and other transactions.
|
(3)
|
Security collateral on deposit from counterparties may not be sold or repledged, unless the counterparty is in default, and is not reflected in the consolidated financial statements.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
|
(In millions)
|
||||||
Invested assets on deposit (regulatory deposits) (1)
|
$
|
9,057
|
|
|
$
|
2,153
|
|
Invested assets held in trust (collateral financing arrangements and reinsurance agreements)
|
11,583
|
|
|
11,004
|
|
||
Invested assets pledged as collateral (2)
|
23,857
|
|
|
23,770
|
|
||
Total invested assets on deposit, held in trust and pledged as collateral
|
$
|
44,497
|
|
|
$
|
36,927
|
|
(1)
|
In 2013, MetLife, Inc. announced its plans to merge three U.S.-based life insurance companies and an offshore reinsurance subsidiary to create one larger U.S.-based and U.S.-regulated life insurance company (the “Mergers”). The Mergers are expected to occur in the fourth quarter of 2014, subject to regulatory approvals. The companies to be merged are MetLife Insurance Company of Connecticut (“MICC”), MetLife Investors USA Insurance Company (“MLI-USA”) and MetLife Investors Insurance Company, each a U.S. insurance company that issues variable annuity products in addition to other products, and Exeter Reassurance Company, Ltd. (“Exeter”), a reinsurance company that mainly reinsures guarantees associated with variable annuity products. MICC, which is expected to be renamed and domiciled in Delaware, will be the surviving entity. In October 2013, Exeter, formerly a Cayman Islands company, was re-domesticated to Delaware. Effective January 1, 2014, following receipt of New York State Department of Financial Services (the “Department of Financial Services”) approval, MICC withdrew its license to issue insurance policies and annuity contracts in New York. Also effective January 1, 2014, MICC reinsured with an affiliate all existing New York insurance policies and annuity contracts that include a separate account feature. On December 31, 2013, MICC deposited investments with an estimated fair market value of
$6.3 billion
into a custodial account to secure MICC’s remaining New York policyholder liabilities not covered by the reinsurance, which became restricted on January 1, 2014.
|
(2)
|
The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements (see Notes 4 and 12 of the Notes to the Consolidated Financial Statements included in the
2013
Annual Report), collateral financing arrangements (see Note 13 of the Notes to the Consolidated Financial Statements included in the
2013
Annual Report) and derivative transactions (see Note 7).
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Total
Assets
|
|
Total
Liabilities
|
|
Total
Assets
|
|
Total
Liabilities
|
||||||||
|
(In millions)
|
||||||||||||||
MRSC (collateral financing arrangement (primarily securities)) (1)
|
$
|
3,457
|
|
|
$
|
—
|
|
|
$
|
3,440
|
|
|
$
|
—
|
|
Operating joint venture (2)
|
2,383
|
|
|
2,016
|
|
|
2,095
|
|
|
1,777
|
|
||||
CSEs (assets (primarily loans) and liabilities (primarily debt)) (3)
|
661
|
|
|
512
|
|
|
1,630
|
|
|
1,457
|
|
||||
Investments:
|
|
|
|
|
|
|
|
||||||||
Real estate and real estate joint ventures (4)
|
10
|
|
|
15
|
|
|
1,181
|
|
|
443
|
|
||||
Other invested assets
|
75
|
|
|
—
|
|
|
82
|
|
|
7
|
|
||||
FVO and trading securities
|
66
|
|
|
—
|
|
|
69
|
|
|
—
|
|
||||
Other limited partnership interests
|
61
|
|
|
—
|
|
|
61
|
|
|
—
|
|
||||
Total
|
$
|
6,713
|
|
|
$
|
2,543
|
|
|
$
|
8,558
|
|
|
$
|
3,684
|
|
(1)
|
See Note 13 of the Notes to the Consolidated Financial Statements included in the
2013
Annual Report for a description of the MetLife Reinsurance Company of South Carolina (“MRSC”) collateral financing arrangement.
|
(2)
|
Assets of the operating joint venture are primarily fixed maturity securities and separate account assets. Liabilities of the operating joint venture are primarily future policy benefits, other policyholder funds and separate account liabilities.
|
(3)
|
The Company consolidates entities that are structured as CMBS and 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
$129 million
and
$154 million
at estimated fair value at
June 30, 2014
and
December 31, 2013
, respectively. The long-term debt bears interest primarily at fixed rates ranging from
2.25%
to
5.57%
, payable primarily on a monthly basis. Interest expense related to these obligations, included in other expenses, was
$13 million
and
$31 million
for the
three months
and
six months ended
June 30, 2014
, respectively, and
$34 million
and
$67 million
for the
three months
and
six months ended
June 30, 2013
, respectively.
|
(4)
|
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 consolidates 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 bore interest primarily at fixed rates ranging from
1.39%
to
4.45%
, payable primarily on a monthly basis.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Carrying
Amount
|
|
Maximum
Exposure
to Loss (1)
|
|
Carrying
Amount
|
|
Maximum
Exposure
to Loss (1)
|
||||||||
|
(In millions)
|
||||||||||||||
Fixed maturity securities AFS:
|
|
|
|
|
|
|
|
||||||||
Structured securities (RMBS, CMBS and ABS) (2)
|
$
|
69,503
|
|
|
$
|
69,503
|
|
|
$
|
67,176
|
|
|
$
|
67,176
|
|
U.S. and foreign corporate
|
4,234
|
|
|
4,234
|
|
|
3,966
|
|
|
3,966
|
|
||||
Other limited partnership interests
|
5,362
|
|
|
7,264
|
|
|
5,041
|
|
|
6,994
|
|
||||
Other invested assets
|
1,571
|
|
|
1,715
|
|
|
1,509
|
|
|
1,897
|
|
||||
FVO and trading securities
|
582
|
|
|
582
|
|
|
619
|
|
|
619
|
|
||||
Mortgage loans
|
107
|
|
|
107
|
|
|
106
|
|
|
106
|
|
||||
Real estate joint ventures
|
66
|
|
|
67
|
|
|
70
|
|
|
71
|
|
||||
Equity securities AFS:
|
|
|
|
|
|
|
|
||||||||
Non-redeemable preferred stock
|
41
|
|
|
41
|
|
|
35
|
|
|
35
|
|
||||
Total
|
$
|
81,466
|
|
|
$
|
83,513
|
|
|
$
|
78,522
|
|
|
$
|
80,864
|
|
(1)
|
The maximum exposure to loss relating to fixed maturity securities AFS, FVO and trading securities and equity 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, mortgage loans 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
$234 million
and
$257 million
at
June 30, 2014
and
December 31, 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.
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(In millions)
|
||||||||||||||
Investment income:
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities
|
|
$
|
3,758
|
|
|
$
|
3,709
|
|
|
$
|
7,411
|
|
|
$
|
7,535
|
|
Equity securities
|
|
37
|
|
|
36
|
|
|
67
|
|
|
60
|
|
||||
FVO and trading securities — Actively Traded Securities and FVO general account securities (1)
|
|
44
|
|
|
(11
|
)
|
|
81
|
|
|
10
|
|
||||
Mortgage loans
|
|
708
|
|
|
716
|
|
|
1,417
|
|
|
1,454
|
|
||||
Policy loans
|
|
158
|
|
|
152
|
|
|
315
|
|
|
307
|
|
||||
Real estate and real estate joint ventures
|
|
262
|
|
|
243
|
|
|
479
|
|
|
436
|
|
||||
Other limited partnership interests
|
|
206
|
|
|
275
|
|
|
535
|
|
|
521
|
|
||||
Cash, cash equivalents and short-term investments
|
|
41
|
|
|
45
|
|
|
88
|
|
|
94
|
|
||||
International joint ventures
|
|
3
|
|
|
5
|
|
|
3
|
|
|
(9
|
)
|
||||
Other
|
|
31
|
|
|
49
|
|
|
76
|
|
|
112
|
|
||||
Subtotal
|
|
5,248
|
|
|
5,219
|
|
|
10,472
|
|
|
10,520
|
|
||||
Less: Investment expenses
|
|
299
|
|
|
287
|
|
|
575
|
|
|
587
|
|
||||
Subtotal, net
|
|
4,949
|
|
|
4,932
|
|
|
9,897
|
|
|
9,933
|
|
||||
FVO and trading securities — FVO contractholder-directed unit-linked investments (1)
|
|
295
|
|
|
314
|
|
|
360
|
|
|
1,353
|
|
||||
FVO CSEs — interest income:
|
|
|
|
|
|
|
|
|
||||||||
Commercial mortgage loans
|
|
14
|
|
|
34
|
|
|
36
|
|
|
71
|
|
||||
Securities
|
|
1
|
|
|
2
|
|
|
1
|
|
|
2
|
|
||||
Subtotal
|
|
310
|
|
|
350
|
|
|
397
|
|
|
1,426
|
|
||||
Net investment income
|
|
$
|
5,259
|
|
|
$
|
5,282
|
|
|
$
|
10,294
|
|
|
$
|
11,359
|
|
(1)
|
Changes in estimated fair value subsequent to purchase for securities still held as of the end of the respective periods included in net investment income were as follows:
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(In millions)
|
||||||||||||||
Actively Traded Securities and FVO general account securities
|
|
$
|
14
|
|
|
$
|
(24
|
)
|
|
$
|
25
|
|
|
$
|
(14
|
)
|
FVO contractholder-directed unit-linked investments
|
|
$
|
138
|
|
|
$
|
123
|
|
|
$
|
81
|
|
|
$
|
1,078
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(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:
|
|
|
|
|
|
|
|
||||||||
Utility
|
$
|
—
|
|
|
$
|
(27
|
)
|
|
$
|
—
|
|
|
$
|
(32
|
)
|
Consumer
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
(8
|
)
|
||||
Finance
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
||||
Transportation
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
||||
Communications
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Total U.S. and foreign corporate securities
|
(2
|
)
|
|
(29
|
)
|
|
(9
|
)
|
|
(52
|
)
|
||||
RMBS
|
(6
|
)
|
|
(10
|
)
|
|
(9
|
)
|
|
(47
|
)
|
||||
ABS
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
||||
OTTI losses on fixed maturity securities recognized in earnings
|
(15
|
)
|
|
(39
|
)
|
|
(25
|
)
|
|
(99
|
)
|
||||
Fixed maturity securities — net gains (losses) on sales and disposals
|
69
|
|
|
179
|
|
|
165
|
|
|
548
|
|
||||
Total gains (losses) on fixed maturity securities
|
54
|
|
|
140
|
|
|
140
|
|
|
449
|
|
||||
Total gains (losses) on equity securities:
|
|
|
|
|
|
|
|
||||||||
Total OTTI losses recognized — by sector:
|
|
|
|
|
|
|
|
||||||||
Non-redeemable preferred stock
|
(23
|
)
|
|
—
|
|
|
(23
|
)
|
|
(20
|
)
|
||||
Common stock
|
(10
|
)
|
|
(1
|
)
|
|
(11
|
)
|
|
(2
|
)
|
||||
OTTI losses on equity securities recognized in earnings
|
(33
|
)
|
|
(1
|
)
|
|
(34
|
)
|
|
(22
|
)
|
||||
Equity securities — net gains (losses) on sales and disposals
|
58
|
|
|
5
|
|
|
84
|
|
|
(1
|
)
|
||||
Total gains (losses) on equity securities
|
25
|
|
|
4
|
|
|
50
|
|
|
(23
|
)
|
||||
FVO and trading securities — FVO general account securities
|
(1
|
)
|
|
4
|
|
|
8
|
|
|
8
|
|
||||
Mortgage loans
|
16
|
|
|
23
|
|
|
5
|
|
|
35
|
|
||||
Real estate and real estate joint ventures
|
(1
|
)
|
|
(9
|
)
|
|
64
|
|
|
(23
|
)
|
||||
Other limited partnership interests
|
(36
|
)
|
|
(41
|
)
|
|
(38
|
)
|
|
(41
|
)
|
||||
Other investment portfolio gains (losses)
|
(2
|
)
|
|
27
|
|
|
(6
|
)
|
|
34
|
|
||||
Subtotal — investment portfolio gains (losses)
|
55
|
|
|
148
|
|
|
223
|
|
|
439
|
|
||||
FVO CSEs:
|
|
|
|
|
|
|
|
||||||||
Commercial mortgage loans
|
(16
|
)
|
|
(19
|
)
|
|
(15
|
)
|
|
(32
|
)
|
||||
Long-term debt — related to commercial mortgage loans
|
17
|
|
|
26
|
|
|
18
|
|
|
48
|
|
||||
Long-term debt — related to securities
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Non-investment portfolio gains (losses) (1)
|
(181
|
)
|
|
(46
|
)
|
|
(762
|
)
|
|
(31
|
)
|
||||
Subtotal FVO CSEs and non-investment portfolio gains (losses)
|
(180
|
)
|
|
(38
|
)
|
|
(759
|
)
|
|
(15
|
)
|
||||
Total net investment gains (losses)
|
$
|
(125
|
)
|
|
$
|
110
|
|
|
$
|
(536
|
)
|
|
$
|
424
|
|
(1)
|
Non-investment portfolio gain (losses) for the three months and
six months ended
June 30, 2014
includes a loss of
($138) million
and
($633) million
, respectively, related to the disposition of MAL. See Note 3.
|
|
Three Months
Ended June 30, |
||||||||||||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||
|
Fixed Maturity Securities
|
|
Equity Securities
|
|
Total
|
||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Proceeds
|
$
|
19,700
|
|
|
$
|
22,072
|
|
|
$
|
326
|
|
|
$
|
269
|
|
|
$
|
20,026
|
|
|
$
|
22,341
|
|
Gross investment gains
|
$
|
176
|
|
|
$
|
323
|
|
|
$
|
60
|
|
|
$
|
10
|
|
|
$
|
236
|
|
|
$
|
333
|
|
Gross investment losses
|
(107
|
)
|
|
(144
|
)
|
|
(2
|
)
|
|
(5
|
)
|
|
(109
|
)
|
|
(149
|
)
|
||||||
Total OTTI losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Credit-related
|
(15
|
)
|
|
(39
|
)
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
(39
|
)
|
||||||
Other (1)
|
—
|
|
|
—
|
|
|
(33
|
)
|
|
(1
|
)
|
|
(33
|
)
|
|
(1
|
)
|
||||||
Total OTTI losses
|
(15
|
)
|
|
(39
|
)
|
|
(33
|
)
|
|
(1
|
)
|
|
(48
|
)
|
|
(40
|
)
|
||||||
Net investment gains (losses)
|
$
|
54
|
|
|
$
|
140
|
|
|
$
|
25
|
|
|
$
|
4
|
|
|
$
|
79
|
|
|
$
|
144
|
|
|
Six Months
Ended June 30, |
||||||||||||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||
|
Fixed Maturity Securities
|
|
Equity Securities
|
|
Total
|
||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Proceeds
|
$
|
41,991
|
|
|
$
|
41,622
|
|
|
$
|
427
|
|
|
$
|
355
|
|
|
$
|
42,418
|
|
|
$
|
41,977
|
|
Gross investment gains
|
$
|
490
|
|
|
$
|
823
|
|
|
$
|
87
|
|
|
$
|
18
|
|
|
$
|
577
|
|
|
$
|
841
|
|
Gross investment losses
|
(325
|
)
|
|
(275
|
)
|
|
(3
|
)
|
|
(19
|
)
|
|
(328
|
)
|
|
(294
|
)
|
||||||
Total OTTI losses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Credit-related
|
(25
|
)
|
|
(81
|
)
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|
(81
|
)
|
||||||
Other (1)
|
—
|
|
|
(18
|
)
|
|
(34
|
)
|
|
(22
|
)
|
|
(34
|
)
|
|
(40
|
)
|
||||||
Total OTTI losses
|
(25
|
)
|
|
(99
|
)
|
|
(34
|
)
|
|
(22
|
)
|
|
(59
|
)
|
|
(121
|
)
|
||||||
Net investment gains (losses)
|
$
|
140
|
|
|
$
|
449
|
|
|
$
|
50
|
|
|
$
|
(23
|
)
|
|
$
|
190
|
|
|
$
|
426
|
|
(1)
|
Other OTTI losses recognized in earnings include impairments on (i) equity securities, (ii) 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 (iii) 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.
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Balance, beginning of period
|
$
|
370
|
|
|
$
|
398
|
|
|
$
|
378
|
|
|
$
|
392
|
|
Additions:
|
|
|
|
|
|
|
|
||||||||
Initial impairments — credit loss OTTI recognized on securities not previously impaired
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||
Additional impairments — credit loss OTTI recognized on securities previously impaired
|
6
|
|
|
6
|
|
|
8
|
|
|
41
|
|
||||
Reductions:
|
|
|
|
|
|
|
|
||||||||
Sales (maturities, pay downs or prepayments) during the period of securities previously impaired as credit loss OTTI
|
(10
|
)
|
|
(24
|
)
|
|
(20
|
)
|
|
(54
|
)
|
||||
Securities impaired to net present value of expected future cash flows
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
||||
Balance, end of period
|
$
|
359
|
|
|
$
|
381
|
|
|
$
|
359
|
|
|
$
|
381
|
|
|
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||||
|
|
Primary Underlying Risk Exposure
|
|
Notional
Amount
|
|
Estimated Fair Value
|
|
Notional
Amount
|
|
Estimated Fair Value
|
||||||||||||||||
|
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||||||||||||
|
|
|
|
(In millions)
|
||||||||||||||||||||||
Derivatives Designated as Hedging Instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Fair value hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swaps
|
|
Interest rate
|
|
$
|
6,213
|
|
|
$
|
1,653
|
|
|
$
|
30
|
|
|
$
|
6,419
|
|
|
$
|
1,282
|
|
|
$
|
78
|
|
Foreign currency swaps
|
|
Foreign currency exchange rate
|
|
1,780
|
|
|
229
|
|
|
31
|
|
|
2,713
|
|
|
252
|
|
|
135
|
|
||||||
Foreign currency forwards
|
|
Foreign currency exchange rate
|
|
2,825
|
|
|
4
|
|
|
4
|
|
|
2,935
|
|
|
—
|
|
|
77
|
|
||||||
Subtotal
|
|
|
|
10,818
|
|
|
1,886
|
|
|
65
|
|
|
12,067
|
|
|
1,534
|
|
|
290
|
|
||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swaps
|
|
Interest rate
|
|
2,878
|
|
|
266
|
|
|
17
|
|
|
3,121
|
|
|
83
|
|
|
141
|
|
||||||
Interest rate forwards
|
|
Interest rate
|
|
640
|
|
|
45
|
|
|
8
|
|
|
450
|
|
|
7
|
|
|
7
|
|
||||||
Foreign currency swaps
|
|
Foreign currency exchange rate
|
|
14,921
|
|
|
457
|
|
|
614
|
|
|
12,452
|
|
|
401
|
|
|
660
|
|
||||||
Subtotal
|
|
|
|
18,439
|
|
|
768
|
|
|
639
|
|
|
16,023
|
|
|
491
|
|
|
808
|
|
||||||
Foreign operations hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency forwards
|
|
Foreign currency exchange rate
|
|
2,725
|
|
|
1
|
|
|
19
|
|
|
3,182
|
|
|
82
|
|
|
47
|
|
||||||
Currency options
|
|
Foreign currency exchange rate
|
|
6,419
|
|
|
39
|
|
|
68
|
|
|
7,362
|
|
|
318
|
|
|
—
|
|
||||||
Subtotal
|
|
|
|
9,144
|
|
|
40
|
|
|
87
|
|
|
10,544
|
|
|
400
|
|
|
47
|
|
||||||
Total qualifying hedges
|
|
38,401
|
|
|
2,694
|
|
|
791
|
|
|
38,634
|
|
|
2,425
|
|
|
1,145
|
|
||||||||
Derivatives Not Designated or Not Qualifying as Hedging Instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest rate swaps
|
|
Interest rate
|
|
95,551
|
|
|
3,405
|
|
|
1,388
|
|
|
107,354
|
|
|
3,330
|
|
|
1,767
|
|
||||||
Interest rate floors
|
|
Interest rate
|
|
67,265
|
|
|
457
|
|
|
285
|
|
|
63,064
|
|
|
451
|
|
|
346
|
|
||||||
Interest rate caps
|
|
Interest rate
|
|
36,605
|
|
|
111
|
|
|
—
|
|
|
39,460
|
|
|
177
|
|
|
—
|
|
||||||
Interest rate futures
|
|
Interest rate
|
|
6,364
|
|
|
3
|
|
|
6
|
|
|
6,011
|
|
|
9
|
|
|
9
|
|
||||||
Interest rate options
|
|
Interest rate
|
|
39,361
|
|
|
524
|
|
|
179
|
|
|
40,978
|
|
|
255
|
|
|
243
|
|
||||||
Synthetic GICs
|
|
Interest rate
|
|
4,362
|
|
|
—
|
|
|
—
|
|
|
4,409
|
|
|
—
|
|
|
—
|
|
||||||
Foreign currency swaps
|
|
Foreign currency exchange rate
|
|
9,222
|
|
|
124
|
|
|
712
|
|
|
9,307
|
|
|
133
|
|
|
684
|
|
||||||
Foreign currency forwards
|
|
Foreign currency exchange rate
|
|
12,669
|
|
|
107
|
|
|
95
|
|
|
11,311
|
|
|
69
|
|
|
359
|
|
||||||
Currency futures
|
|
Foreign currency exchange rate
|
|
382
|
|
|
1
|
|
|
—
|
|
|
1,316
|
|
|
1
|
|
|
1
|
|
||||||
Currency options
|
|
Foreign currency exchange rate
|
|
8,389
|
|
|
155
|
|
|
7
|
|
|
2,265
|
|
|
53
|
|
|
48
|
|
||||||
Credit default swaps — purchased
|
|
Credit
|
|
3,675
|
|
|
6
|
|
|
49
|
|
|
3,725
|
|
|
7
|
|
|
51
|
|
||||||
Credit default swaps — written
|
|
Credit
|
|
9,982
|
|
|
175
|
|
|
2
|
|
|
9,055
|
|
|
166
|
|
|
1
|
|
||||||
Equity futures
|
|
Equity market
|
|
5,814
|
|
|
1
|
|
|
11
|
|
|
5,157
|
|
|
1
|
|
|
43
|
|
||||||
Equity options
|
|
Equity market
|
|
38,116
|
|
|
1,272
|
|
|
1,228
|
|
|
37,411
|
|
|
1,344
|
|
|
1,068
|
|
||||||
Variance swaps
|
|
Equity market
|
|
21,985
|
|
|
217
|
|
|
691
|
|
|
21,636
|
|
|
174
|
|
|
577
|
|
||||||
TRRs
|
|
Equity market
|
|
3,449
|
|
|
—
|
|
|
138
|
|
|
3,802
|
|
|
—
|
|
|
179
|
|
||||||
Total non-designated or non-qualifying derivatives
|
|
363,191
|
|
|
6,558
|
|
|
4,791
|
|
|
366,261
|
|
|
6,170
|
|
|
5,376
|
|
||||||||
Total
|
|
|
|
$
|
401,592
|
|
|
$
|
9,252
|
|
|
$
|
5,582
|
|
|
$
|
404,895
|
|
|
$
|
8,595
|
|
|
$
|
6,521
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Derivatives and hedging gains (losses) (1)
|
$
|
82
|
|
|
$
|
(2,769
|
)
|
|
$
|
534
|
|
|
$
|
(5,083
|
)
|
Embedded derivatives
|
229
|
|
|
1,079
|
|
|
120
|
|
|
2,763
|
|
||||
Total net derivative gains (losses)
|
$
|
311
|
|
|
$
|
(1,690
|
)
|
|
$
|
654
|
|
|
$
|
(2,320
|
)
|
(1)
|
Includes foreign currency transaction gains (losses) on hedged items in cash flow and non-qualifying hedging relationships, which are not presented elsewhere in this note.
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Qualifying hedges:
|
|
|
|
|
|
|
|
||||||||
Net investment income
|
$
|
34
|
|
|
$
|
35
|
|
|
$
|
67
|
|
|
$
|
71
|
|
Interest credited to policyholder account balances
|
32
|
|
|
36
|
|
|
64
|
|
|
71
|
|
||||
Other expenses
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(4
|
)
|
||||
Non-qualifying hedges:
|
|
|
|
|
|
|
|
||||||||
Net investment income
|
(1
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(3
|
)
|
||||
Net derivative gains (losses)
|
149
|
|
|
200
|
|
|
368
|
|
|
215
|
|
||||
Policyholder benefits and claims
|
(56
|
)
|
|
9
|
|
|
(64
|
)
|
|
(56
|
)
|
||||
Total
|
$
|
158
|
|
|
$
|
277
|
|
|
$
|
432
|
|
|
$
|
294
|
|
|
Net
Derivative
Gains (Losses)
|
|
Net
Investment
Income (1)
|
|
Policyholder
Benefits and
Claims (2)
|
||||||
|
(In millions)
|
||||||||||
Three Months Ended June 30, 2014
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
305
|
|
|
$
|
—
|
|
|
$
|
10
|
|
Foreign currency exchange rate derivatives
|
(81
|
)
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
(7
|
)
|
|
(1
|
)
|
|
—
|
|
|||
Credit derivatives — written
|
22
|
|
|
—
|
|
|
—
|
|
|||
Equity derivatives
|
(425
|
)
|
|
(6
|
)
|
|
(119
|
)
|
|||
Total
|
$
|
(186
|
)
|
|
$
|
(7
|
)
|
|
$
|
(109
|
)
|
Three Months Ended June 30, 2013
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
(2,128
|
)
|
|
$
|
—
|
|
|
$
|
(19
|
)
|
Foreign currency exchange rate derivatives
|
(533
|
)
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
1
|
|
|
(1
|
)
|
|
—
|
|
|||
Credit derivatives — written
|
(5
|
)
|
|
—
|
|
|
—
|
|
|||
Equity derivatives
|
(329
|
)
|
|
(4
|
)
|
|
(82
|
)
|
|||
Total
|
$
|
(2,994
|
)
|
|
$
|
(5
|
)
|
|
$
|
(101
|
)
|
Six Months Ended June 30, 2014
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
603
|
|
|
$
|
—
|
|
|
$
|
22
|
|
Foreign currency exchange rate derivatives
|
(12
|
)
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
(6
|
)
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — written
|
13
|
|
|
—
|
|
|
—
|
|
|||
Equity derivatives
|
(606
|
)
|
|
(12
|
)
|
|
(157
|
)
|
|||
Total
|
$
|
(8
|
)
|
|
$
|
(12
|
)
|
|
$
|
(135
|
)
|
Six Months Ended June 30, 2013
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
(2,361
|
)
|
|
$
|
—
|
|
|
$
|
(17
|
)
|
Foreign currency exchange rate derivatives
|
(984
|
)
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
(5
|
)
|
|
(4
|
)
|
|
—
|
|
|||
Credit derivatives — written
|
27
|
|
|
—
|
|
|
—
|
|
|||
Equity derivatives
|
(1,882
|
)
|
|
(11
|
)
|
|
(356
|
)
|
|||
Total
|
$
|
(5,205
|
)
|
|
$
|
(15
|
)
|
|
$
|
(373
|
)
|
(1)
|
Changes in estimated fair value related to economic hedges of equity method investments in joint ventures; changes in estimated fair value related to derivatives held in relation to trading portfolios; and changes in estimated fair value related to derivatives held within contractholder-directed unit-linked investments.
|
(2)
|
Changes in estimated fair value related to economic hedges of variable annuity guarantees included in future policy benefits.
|
Derivatives in Fair Value
Hedging Relationships
|
|
Hedged Items in Fair Value
Hedging Relationships
|
|
Net Derivative
Gains (Losses)
Recognized
for Derivatives
|
|
Net Derivative
Gains (Losses)
Recognized for
Hedged Items
|
|
Ineffectiveness
Recognized in
Net Derivative
Gains (Losses)
|
||||||
|
|
|
|
(In millions)
|
||||||||||
Three Months Ended June 30, 2014
|
|
|
||||||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
(3
|
)
|
|
$
|
2
|
|
|
$
|
(1
|
)
|
|
|
Policyholder liabilities (1)
|
|
137
|
|
|
(131
|
)
|
|
6
|
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
(3
|
)
|
|
3
|
|
|
—
|
|
|||
|
|
Foreign-denominated PABs (2)
|
|
1
|
|
|
(3
|
)
|
|
(2
|
)
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
6
|
|
|
(5
|
)
|
|
1
|
|
|||
Total
|
|
$
|
138
|
|
|
$
|
(134
|
)
|
|
$
|
4
|
|
||
Three Months Ended June 30, 2013
|
|
|
|
|
|
|
||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
30
|
|
|
$
|
(30
|
)
|
|
$
|
—
|
|
|
|
Policyholder liabilities (1)
|
|
(383
|
)
|
|
381
|
|
|
(2
|
)
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
13
|
|
|
(11
|
)
|
|
2
|
|
|||
|
|
Foreign-denominated PABs (2)
|
|
(55
|
)
|
|
63
|
|
|
8
|
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
(395
|
)
|
|
$
|
403
|
|
|
$
|
8
|
|
||
Six Months Ended June 30, 2014
|
|
|
||||||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
(2
|
)
|
|
$
|
3
|
|
|
$
|
1
|
|
|
|
Policyholder liabilities (1)
|
|
346
|
|
|
(335
|
)
|
|
11
|
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
(7
|
)
|
|
7
|
|
|
—
|
|
|||
|
|
Foreign-denominated PABs (2)
|
|
(26
|
)
|
|
29
|
|
|
3
|
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
16
|
|
|
(14
|
)
|
|
2
|
|
|||
Total
|
|
$
|
327
|
|
|
$
|
(310
|
)
|
|
$
|
17
|
|
||
Six Months Ended June 30, 2013
|
|
|
|
|
|
|
||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
38
|
|
|
$
|
(38
|
)
|
|
$
|
—
|
|
|
|
Policyholder liabilities (1)
|
|
(536
|
)
|
|
533
|
|
|
(3
|
)
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
17
|
|
|
(16
|
)
|
|
1
|
|
|||
|
|
Foreign-denominated PABs (2)
|
|
(194
|
)
|
|
196
|
|
|
2
|
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
(675
|
)
|
|
$
|
675
|
|
|
$
|
—
|
|
(1)
|
Fixed rate liabilities reported in PABs or future policy benefits.
|
(2)
|
Fixed rate or floating rate liabilities.
|
Derivatives in Cash Flow
Hedging Relationships
|
|
Amount of Gains
(Losses) Deferred in
AOCI on Derivatives
|
|
Amount and Location
of Gains (Losses)
Reclassified from
AOCI into Income (Loss)
|
|
Amount and Location
of Gains (Losses)
Recognized in Income
(Loss) on Derivatives
|
||||||||||||||
|
|
(Effective Portion)
|
|
(Effective Portion)
|
|
(Ineffective Portion)
|
||||||||||||||
|
|
|
|
Net Derivative
Gains (Losses)
|
|
Net Investment
Income
|
|
Other
Expenses
|
|
Net Derivative
Gains (Losses)
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Three Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
134
|
|
|
$
|
12
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
(5
|
)
|
Interest rate forwards
|
|
11
|
|
|
2
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|||||
Foreign currency swaps
|
|
30
|
|
|
62
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||
Credit forwards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
175
|
|
|
$
|
76
|
|
|
$
|
3
|
|
|
$
|
1
|
|
|
$
|
(6
|
)
|
Three Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
(273
|
)
|
|
$
|
10
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
6
|
|
Interest rate forwards
|
|
(5
|
)
|
|
3
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Foreign currency swaps
|
|
(30
|
)
|
|
(68
|
)
|
|
(1
|
)
|
|
—
|
|
|
2
|
|
|||||
Credit forwards
|
|
(3
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
(311
|
)
|
|
$
|
(55
|
)
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
9
|
|
Six Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
362
|
|
|
$
|
27
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest rate forwards
|
|
52
|
|
|
2
|
|
|
2
|
|
|
1
|
|
|
1
|
|
|||||
Foreign currency swaps
|
|
82
|
|
|
98
|
|
|
(1
|
)
|
|
1
|
|
|
(1
|
)
|
|||||
Credit forwards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
496
|
|
|
$
|
127
|
|
|
$
|
5
|
|
|
$
|
2
|
|
|
$
|
—
|
|
Six Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
(397
|
)
|
|
$
|
14
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Interest rate forwards
|
|
(30
|
)
|
|
6
|
|
|
1
|
|
|
(1
|
)
|
|
1
|
|
|||||
Foreign currency swaps
|
|
57
|
|
|
(257
|
)
|
|
(2
|
)
|
|
—
|
|
|
6
|
|
|||||
Credit forwards
|
|
(3
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
(373
|
)
|
|
$
|
(237
|
)
|
|
$
|
4
|
|
|
$
|
(1
|
)
|
|
$
|
11
|
|
(1)
|
In May 2014, the Company sold its interest in MAL, which was a hedged item in a net investment hedging relationship. As a result, during both the
three months
and
six months ended
June 30, 2014
, the Company released losses of
$77 million
from accumulated other comprehensive income (loss) into earnings upon the sale. See Note 3. During the
three months
and
six months ended
June 30, 2013
, there were
no
sales or substantial liquidations of net investments in foreign operations that would have required the reclassification of gains or losses from AOCI into earnings.
|
(2)
|
There was
no
ineffectiveness recognized for the Company’s hedges of net investments in foreign operations. All components of each derivative’s gain or loss were included in the assessment of hedge effectiveness.
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||
Rating Agency Designation of Referenced
Credit Obligations (1)
|
|
Estimated
Fair Value
of Credit
Default
Swaps
|
|
Maximum
Amount of Future
Payments under
Credit Default
Swaps (2)
|
|
Weighted
Average
Years to
Maturity (3)
|
|
Estimated
Fair Value
of Credit
Default
Swaps
|
|
Maximum
Amount of Future
Payments under
Credit Default
Swaps (2)
|
|
Weighted
Average
Years to
Maturity (3)
|
||||||||||
|
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||||||||||
Aaa/Aa/A
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Single name credit default swaps (corporate)
|
|
$
|
9
|
|
|
$
|
605
|
|
|
2.4
|
|
|
$
|
10
|
|
|
$
|
545
|
|
|
2.6
|
|
Credit default swaps referencing indices
|
|
15
|
|
|
2,877
|
|
|
1.9
|
|
|
26
|
|
|
2,739
|
|
|
1.5
|
|
||||
Subtotal
|
|
24
|
|
|
3,482
|
|
|
2.0
|
|
|
36
|
|
|
3,284
|
|
|
1.6
|
|
||||
Baa
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Single name credit default swaps (corporate)
|
|
27
|
|
|
1,478
|
|
|
2.9
|
|
|
24
|
|
|
1,320
|
|
|
3.1
|
|
||||
Credit default swaps referencing indices
|
|
89
|
|
|
4,635
|
|
|
4.7
|
|
|
73
|
|
|
4,071
|
|
|
4.7
|
|
||||
Subtotal
|
|
116
|
|
|
6,113
|
|
|
4.3
|
|
|
97
|
|
|
5,391
|
|
|
4.3
|
|
||||
Ba
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Single name credit default swaps (corporate)
|
|
—
|
|
|
15
|
|
|
3.1
|
|
|
—
|
|
|
5
|
|
|
3.8
|
|
||||
Credit default swaps referencing indices
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Subtotal
|
|
—
|
|
|
15
|
|
|
3.1
|
|
|
—
|
|
|
5
|
|
|
3.8
|
|
||||
B
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Single name credit default swaps (corporate)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Credit default swaps referencing indices
|
|
33
|
|
|
372
|
|
|
4.9
|
|
|
32
|
|
|
375
|
|
|
4.9
|
|
||||
Subtotal
|
|
33
|
|
|
372
|
|
|
4.9
|
|
|
32
|
|
|
375
|
|
|
4.9
|
|
||||
Total
|
|
$
|
173
|
|
|
$
|
9,982
|
|
|
3.5
|
|
|
$
|
165
|
|
|
$
|
9,055
|
|
|
3.4
|
|
(1)
|
The rating agency designations are based on availability and the midpoint of the applicable ratings among Moody’s Investors Service (“Moody’s”), Standard & Poor’s Ratings Services (“S&P”) and Fitch Ratings. If no rating is available from a rating agency, then an internally developed rating is used.
|
(2)
|
Assumes the value of the referenced credit obligations is zero.
|
(3)
|
The weighted average years to maturity of the credit default swaps is calculated based on weighted average notional amounts.
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
Derivatives Subject to a Master Netting Arrangement or a Similar Arrangement
|
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||
|
|
(In millions)
|
||||||||||||||
Gross estimated fair value of derivatives:
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral (1)
|
|
$
|
9,151
|
|
|
$
|
5,281
|
|
|
$
|
8,537
|
|
|
$
|
6,367
|
|
OTC-cleared (1)
|
|
310
|
|
|
335
|
|
|
302
|
|
|
129
|
|
||||
Exchange-traded
|
|
5
|
|
|
17
|
|
|
11
|
|
|
53
|
|
||||
Total gross estimated fair value of derivatives (1)
|
|
9,466
|
|
|
5,633
|
|
|
8,850
|
|
|
6,549
|
|
||||
Amounts offset on the consolidated balance sheets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Estimated fair value of derivatives presented on the consolidated balance sheets (1)
|
|
9,466
|
|
|
5,633
|
|
|
8,850
|
|
|
6,549
|
|
||||
Gross amounts not offset on the consolidated balance sheets:
|
|
|
|
|
|
|
|
|
||||||||
Gross estimated fair value of derivatives: (2)
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral
|
|
(4,134
|
)
|
|
(4,134
|
)
|
|
(4,631
|
)
|
|
(4,631
|
)
|
||||
OTC-cleared
|
|
(195
|
)
|
|
(195
|
)
|
|
(122
|
)
|
|
(122
|
)
|
||||
Exchange-traded
|
|
(3
|
)
|
|
(3
|
)
|
|
(5
|
)
|
|
(5
|
)
|
||||
Cash collateral: (3)
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral
|
|
(1,960
|
)
|
|
(4
|
)
|
|
(1,679
|
)
|
|
(3
|
)
|
||||
OTC-cleared
|
|
(115
|
)
|
|
(140
|
)
|
|
(169
|
)
|
|
(7
|
)
|
||||
Exchange-traded
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
|
(44
|
)
|
||||
Securities collateral: (4)
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral
|
|
(2,891
|
)
|
|
(971
|
)
|
|
(2,105
|
)
|
|
(1,464
|
)
|
||||
OTC-cleared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Exchange-traded
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(4
|
)
|
||||
Net amount after application of master netting agreements and collateral
|
|
$
|
168
|
|
|
$
|
172
|
|
|
$
|
139
|
|
|
$
|
269
|
|
(1)
|
At
June 30, 2014
and
December 31, 2013
, derivative assets include income or expense accruals reported in accrued investment income or in other liabilities of
$214 million
and
$255 million
, respectively, and derivative liabilities include income or expense accruals reported in accrued investment income or in other liabilities of
$51 million
and
$28 million
, respectively.
|
(2)
|
Estimated fair value of derivatives is limited to the amount that is subject to set-off and includes income or expense accruals.
|
(3)
|
Cash collateral received is included in cash and cash equivalents, short-term investments or in fixed maturity securities, and the obligation to return it is included in payables for collateral under securities loaned and other transactions on the balance sheet. The receivable for the return of cash collateral provided by the Company is inclusive of initial margin on exchange-traded and OTC-cleared derivatives and is included in premiums, reinsurance and other receivables on the balance sheet. The amount of cash collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreements. At
June 30, 2014
and
December 31, 2013
, the Company received excess cash collateral of
$63 million
and
$104 million
, respectively, and provided excess cash collateral of
$226 million
and
$236 million
, respectively, which is not included in the table above due to the foregoing limitation.
|
(4)
|
Securities collateral received by the Company is held in separate custodial accounts and is not recorded on the balance sheet. Subject to certain constraints, the Company is permitted by contract to sell or repledge this collateral, but at
June 30, 2014
none
of the collateral had been sold or repledged. Securities collateral pledged by the Company is reported in fixed maturity securities on the balance sheet. Subject to certain constraints, the counterparties are permitted by contract to sell or repledge this collateral. The amount of securities collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreements and cash collateral. At
June 30, 2014
and
December 31, 2013
, the Company received excess securities collateral with an estimated fair value of
$105 million
and
$238 million
, respectively, for its OTC-bilateral derivatives, which are not included in the table above due to the foregoing limitation. At
June 30, 2014
and
December 31, 2013
, the Company provided excess securities collateral with an estimated fair value of
$74 million
and
$66 million
, respectively, for its OTC-bilateral derivatives, and
$130 million
and
$141 million
, respectively, for its OTC-cleared derivatives, and
$200 million
and
$81 million
, respectively, for its exchange-traded derivatives, which are not included in the table above due to the foregoing limitation.
|
|
|
|
|
Estimated Fair Value of
Collateral Provided
|
|
Fair Value of Incremental
Collateral Provided Upon
|
||||||||||||||
|
|
Estimated
Fair Value of
Derivatives in
Net Liability
Position (1)
|
|
Fixed Maturity
Securities
|
|
Cash
|
|
One Notch
Downgrade in
the Company’s
Credit Rating
|
|
Downgrade in the Company’s
Credit Rating to a Level
that Triggers Full Overnight
Collateralization or Termination
of the Derivative Position
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to credit-contingent provisions
|
|
$
|
1,082
|
|
|
$
|
1,045
|
|
|
$
|
—
|
|
|
$
|
32
|
|
|
$
|
58
|
|
Derivatives not subject to credit-contingent provisions
|
|
24
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
1,106
|
|
|
$
|
1,045
|
|
|
$
|
4
|
|
|
$
|
32
|
|
|
$
|
58
|
|
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to credit-contingent provisions
|
|
$
|
1,674
|
|
|
$
|
1,530
|
|
|
$
|
—
|
|
|
$
|
27
|
|
|
$
|
34
|
|
Derivatives not subject to credit-contingent provisions
|
|
20
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
1,694
|
|
|
$
|
1,530
|
|
|
$
|
3
|
|
|
$
|
27
|
|
|
$
|
34
|
|
(1)
|
After taking into consideration the existence of netting agreements.
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Net derivative gains (losses) (1)
|
$
|
229
|
|
|
$
|
1,079
|
|
|
$
|
120
|
|
|
$
|
2,763
|
|
Policyholder benefits and claims
|
$
|
8
|
|
|
$
|
(33
|
)
|
|
$
|
23
|
|
|
$
|
(80
|
)
|
(1)
|
The valuation of guaranteed minimum benefits includes a nonperformance risk adjustment. The amounts included in net derivative gains (losses), in connection with this adjustment, were
($51) million
and
($8) million
for the
three months
and
six months ended
June 30, 2014
, respectively, and
($236) million
and
($650) million
for the
three months
and
six months ended
June 30, 2013
, respectively.
|
|
June 30, 2014
|
||||||||||||||
|
Fair Value Hierarchy
|
|
|
||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total Estimated
Fair Value
|
||||||||
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
||||||||
U.S. corporate
|
$
|
—
|
|
|
$
|
102,024
|
|
|
$
|
7,369
|
|
|
$
|
109,393
|
|
Foreign corporate
|
—
|
|
|
55,876
|
|
|
6,612
|
|
|
62,488
|
|
||||
Foreign government
|
—
|
|
|
54,955
|
|
|
1,672
|
|
|
56,627
|
|
||||
U.S. Treasury and agency
|
32,103
|
|
|
21,924
|
|
|
320
|
|
|
54,347
|
|
||||
RMBS
|
1,330
|
|
|
33,789
|
|
|
3,945
|
|
|
39,064
|
|
||||
CMBS
|
—
|
|
|
15,056
|
|
|
595
|
|
|
15,651
|
|
||||
ABS
|
—
|
|
|
11,002
|
|
|
3,786
|
|
|
14,788
|
|
||||
State and political subdivision
|
—
|
|
|
14,663
|
|
|
35
|
|
|
14,698
|
|
||||
Total fixed maturity securities
|
33,433
|
|
|
309,289
|
|
|
24,334
|
|
|
367,056
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
||||||||
Common stock
|
1,615
|
|
|
906
|
|
|
186
|
|
|
2,707
|
|
||||
Non-redeemable preferred stock
|
—
|
|
|
893
|
|
|
263
|
|
|
1,156
|
|
||||
Total equity securities
|
1,615
|
|
|
1,799
|
|
|
449
|
|
|
3,863
|
|
||||
FVO and trading securities:
|
|
|
|
|
|
|
|
||||||||
Actively Traded Securities
|
—
|
|
|
670
|
|
|
20
|
|
|
690
|
|
||||
FVO general account securities
|
503
|
|
|
70
|
|
|
109
|
|
|
682
|
|
||||
FVO contractholder-directed unit-linked investments
|
11,533
|
|
|
4,337
|
|
|
571
|
|
|
16,441
|
|
||||
FVO securities held by CSEs
|
—
|
|
|
7
|
|
|
11
|
|
|
18
|
|
||||
Total FVO and trading securities
|
12,036
|
|
|
5,084
|
|
|
711
|
|
|
17,831
|
|
||||
Short-term investments (1)
|
4,309
|
|
|
5,723
|
|
|
246
|
|
|
10,278
|
|
||||
Mortgage loans:
|
|
|
|
|
|
|
|
||||||||
Residential mortgage loans — FVO
|
—
|
|
|
—
|
|
|
367
|
|
|
367
|
|
||||
Commercial mortgage loans held by CSEs — FVO
|
—
|
|
|
638
|
|
|
—
|
|
|
638
|
|
||||
Total mortgage loans
|
—
|
|
|
638
|
|
|
367
|
|
|
1,005
|
|
||||
Other invested assets:
|
|
|
|
|
|
|
|
||||||||
Other investments
|
259
|
|
|
67
|
|
|
—
|
|
|
326
|
|
||||
Derivative assets: (2)
|
|
|
|
|
|
|
|
|
|||||||
Interest rate
|
3
|
|
|
6,417
|
|
|
44
|
|
|
6,464
|
|
||||
Foreign currency exchange rate
|
1
|
|
|
1,081
|
|
|
35
|
|
|
1,117
|
|
||||
Credit
|
—
|
|
|
163
|
|
|
18
|
|
|
181
|
|
||||
Equity market
|
1
|
|
|
1,167
|
|
|
322
|
|
|
1,490
|
|
||||
Total derivative assets
|
5
|
|
|
8,828
|
|
|
419
|
|
|
9,252
|
|
||||
Total other invested assets
|
264
|
|
|
8,895
|
|
|
419
|
|
|
9,578
|
|
||||
Net embedded derivatives within asset host contracts (3)
|
—
|
|
|
—
|
|
|
328
|
|
|
328
|
|
||||
Separate account assets (4)
|
87,503
|
|
|
235,783
|
|
|
1,691
|
|
|
324,977
|
|
||||
Total assets
|
$
|
139,160
|
|
|
$
|
567,211
|
|
|
$
|
28,545
|
|
|
$
|
734,916
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities: (2)
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
$
|
6
|
|
|
$
|
1,899
|
|
|
$
|
8
|
|
|
$
|
1,913
|
|
Foreign currency exchange rate
|
—
|
|
|
1,512
|
|
|
38
|
|
|
1,550
|
|
||||
Credit
|
—
|
|
|
50
|
|
|
1
|
|
|
51
|
|
||||
Equity market
|
11
|
|
|
1,340
|
|
|
717
|
|
|
2,068
|
|
||||
Total derivative liabilities
|
17
|
|
|
4,801
|
|
|
764
|
|
|
5,582
|
|
||||
Net embedded derivatives within liability host contracts (3)
|
—
|
|
|
8
|
|
|
(692
|
)
|
|
(684
|
)
|
||||
Long-term debt of CSEs — FVO
|
—
|
|
|
490
|
|
|
15
|
|
|
505
|
|
||||
Trading liabilities (5)
|
218
|
|
|
—
|
|
|
—
|
|
|
218
|
|
||||
Total liabilities
|
$
|
235
|
|
|
$
|
5,299
|
|
|
$
|
87
|
|
|
$
|
5,621
|
|
|
December 31, 2013
|
||||||||||||||
|
Fair Value Hierarchy
|
|
|
||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total Estimated
Fair Value
|
||||||||
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
||||||||
U.S. corporate
|
$
|
—
|
|
|
$
|
99,321
|
|
|
$
|
7,148
|
|
|
$
|
106,469
|
|
Foreign corporate
|
—
|
|
|
56,448
|
|
|
6,704
|
|
|
63,152
|
|
||||
Foreign government
|
—
|
|
|
52,202
|
|
|
2,235
|
|
|
54,437
|
|
||||
U.S. Treasury and agency
|
25,061
|
|
|
20,000
|
|
|
62
|
|
|
45,123
|
|
||||
RMBS
|
—
|
|
|
32,098
|
|
|
2,957
|
|
|
35,055
|
|
||||
CMBS
|
—
|
|
|
15,578
|
|
|
972
|
|
|
16,550
|
|
||||
ABS
|
—
|
|
|
11,361
|
|
|
4,210
|
|
|
15,571
|
|
||||
State and political subdivision
|
—
|
|
|
13,820
|
|
|
10
|
|
|
13,830
|
|
||||
Total fixed maturity securities
|
25,061
|
|
|
300,828
|
|
|
24,298
|
|
|
350,187
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
||||||||
Common stock
|
1,186
|
|
|
990
|
|
|
177
|
|
|
2,353
|
|
||||
Non-redeemable preferred stock
|
—
|
|
|
654
|
|
|
395
|
|
|
1,049
|
|
||||
Total equity securities
|
1,186
|
|
|
1,644
|
|
|
572
|
|
|
3,402
|
|
||||
FVO and trading securities:
|
|
|
|
|
|
|
|
||||||||
Actively Traded Securities
|
2
|
|
|
648
|
|
|
12
|
|
|
662
|
|
||||
FVO general account securities
|
518
|
|
|
80
|
|
|
29
|
|
|
627
|
|
||||
FVO contractholder-directed unit-linked investments
|
10,702
|
|
|
4,806
|
|
|
603
|
|
|
16,111
|
|
||||
FVO securities held by CSEs
|
—
|
|
|
23
|
|
|
—
|
|
|
23
|
|
||||
Total FVO and trading securities
|
11,222
|
|
|
5,557
|
|
|
644
|
|
|
17,423
|
|
||||
Short-term investments (1)
|
5,915
|
|
|
6,943
|
|
|
254
|
|
|
13,112
|
|
||||
Mortgage loans:
|
|
|
|
|
|
|
|
||||||||
Residential mortgage loans — FVO
|
—
|
|
|
—
|
|
|
338
|
|
|
338
|
|
||||
Commercial mortgage loans held by CSEs — FVO
|
—
|
|
|
1,598
|
|
|
—
|
|
|
1,598
|
|
||||
Total mortgage loans
|
—
|
|
|
1,598
|
|
|
338
|
|
|
1,936
|
|
||||
Other invested assets:
|
|
|
|
|
|
|
|
||||||||
Other investments
|
188
|
|
|
71
|
|
|
—
|
|
|
259
|
|
||||
Derivative assets: (2)
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
10
|
|
|
5,557
|
|
|
27
|
|
|
5,594
|
|
||||
Foreign currency exchange rate
|
1
|
|
|
1,280
|
|
|
28
|
|
|
1,309
|
|
||||
Credit
|
—
|
|
|
144
|
|
|
29
|
|
|
173
|
|
||||
Equity market
|
1
|
|
|
1,233
|
|
|
285
|
|
|
1,519
|
|
||||
Total derivative assets
|
12
|
|
|
8,214
|
|
|
369
|
|
|
8,595
|
|
||||
Total other invested assets
|
200
|
|
|
8,285
|
|
|
369
|
|
|
8,854
|
|
||||
Net embedded derivatives within asset host contracts (3)
|
—
|
|
|
—
|
|
|
285
|
|
|
285
|
|
||||
Separate account assets (4)
|
89,960
|
|
|
225,776
|
|
|
1,465
|
|
|
317,201
|
|
||||
Total assets
|
$
|
133,544
|
|
|
$
|
550,631
|
|
|
$
|
28,225
|
|
|
$
|
712,400
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities: (2)
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
$
|
9
|
|
|
$
|
2,568
|
|
|
$
|
14
|
|
|
$
|
2,591
|
|
Foreign currency exchange rate
|
1
|
|
|
1,971
|
|
|
39
|
|
|
2,011
|
|
||||
Credit
|
—
|
|
|
52
|
|
|
—
|
|
|
52
|
|
||||
Equity market
|
43
|
|
|
1,222
|
|
|
602
|
|
|
1,867
|
|
||||
Total derivative liabilities
|
53
|
|
|
5,813
|
|
|
655
|
|
|
6,521
|
|
||||
Net embedded derivatives within liability host contracts (3)
|
—
|
|
|
4
|
|
|
(973
|
)
|
|
(969
|
)
|
||||
Long-term debt of CSEs — FVO
|
—
|
|
|
1,427
|
|
|
28
|
|
|
1,455
|
|
||||
Trading liabilities (5)
|
260
|
|
|
2
|
|
|
—
|
|
|
262
|
|
||||
Total liabilities
|
$
|
313
|
|
|
$
|
7,246
|
|
|
$
|
(290
|
)
|
|
$
|
7,269
|
|
(1)
|
Short-term investments as presented in the tables above differ from the amounts presented on the consolidated balance sheets because certain short-term investments are not measured at estimated fair value on a recurring basis.
|
(2)
|
Derivative assets are presented within other invested assets on the consolidated balance sheets and derivative liabilities are presented within other liabilities on the consolidated balance sheets. The amounts are presented gross in the tables above to reflect the presentation on the consolidated balance sheets, but are presented net for purposes of the rollforward in the Fair Value Measurements Using Significant Unobservable Inputs (Level 3) tables.
|
(3)
|
Net embedded derivatives within asset host contracts are presented primarily within premiums, reinsurance and other receivables on the consolidated balance sheets. Net embedded derivatives within liability host contracts are presented within PABs and other liabilities on the consolidated balance sheets. At
June 30, 2014
and
December 31, 2013
, equity securities also included embedded derivatives of
($170) million
and
($145) million
, respectively.
|
(4)
|
Investment performance related to separate account assets is fully offset by corresponding amounts credited to contractholders whose liability is reflected within separate account liabilities. Separate account liabilities are set equal to the estimated fair value of separate account assets.
|
(5)
|
Trading liabilities are presented within other liabilities on the consolidated balance sheets.
|
|
|
|
|
|
|
|
June 30, 2014
|
|
December 31, 2013
|
|
Impact of
Increase in Input on Estimated Fair Value (2) |
||||||||
|
Valuation
Techniques |
|
Significant
Unobservable Inputs |
|
Range
|
|
Weighted
Average (1) |
|
Range
|
|
Weighted
Average (1) |
|
|||||||
Fixed maturity securities (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
U.S. corporate and foreign corporate
|
•
|
Matrix pricing
|
|
•
|
Delta spread adjustments (4)
|
|
(5)
|
-
|
190
|
|
34
|
|
(10)
|
-
|
240
|
|
46
|
|
Decrease
|
|
|
|
|
•
|
Illiquidity premium (4)
|
|
30
|
-
|
30
|
|
30
|
|
30
|
-
|
30
|
|
30
|
|
Decrease
|
|
|
|
|
•
|
Credit spreads (4)
|
|
(1,473)
|
-
|
706
|
|
129
|
|
(1,489)
|
-
|
876
|
|
174
|
|
Decrease
|
|
|
|
|
•
|
Offered quotes (5)
|
|
—
|
-
|
120
|
|
98
|
|
4
|
-
|
145
|
|
100
|
|
Increase
|
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
—
|
-
|
369
|
|
120
|
|
|
|
|
|
|
|
Increase
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (5)
|
|
31
|
-
|
700
|
|
234
|
|
33
|
-
|
145
|
|
95
|
|
Increase
|
Foreign government
|
•
|
Matrix pricing
|
|
•
|
Credit spreads (4)
|
|
53
|
-
|
56
|
|
54
|
|
4
|
-
|
72
|
|
32
|
|
Decrease
|
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
1
|
-
|
153
|
|
102
|
|
64
|
-
|
156
|
|
100
|
|
Increase
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (5)
|
|
66
|
-
|
140
|
|
113
|
|
84
|
-
|
156
|
|
107
|
|
Increase
|
RMBS
|
•
|
Matrix pricing and
discounted cash flow |
|
•
|
Credit spreads (4)
|
|
220
|
-
|
582
|
|
375
|
|
(136)
|
-
|
3,609
|
|
288
|
|
Decrease (6)
|
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
—
|
-
|
120
|
|
100
|
|
10
|
-
|
109
|
|
98
|
|
Increase (6)
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (5)
|
|
1
|
-
|
111
|
|
92
|
|
69
|
-
|
101
|
|
93
|
|
Increase (6)
|
CMBS
|
•
|
Matrix pricing and
discounted cash flow |
|
•
|
Credit spreads (4)
|
|
(89)
|
-
|
833
|
|
137
|
|
215
|
-
|
2,025
|
|
409
|
|
Decrease (6)
|
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
1
|
-
|
105
|
|
96
|
|
70
|
-
|
104
|
|
97
|
|
Increase (6)
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (5)
|
|
15
|
-
|
104
|
|
101
|
|
90
|
-
|
101
|
|
95
|
|
Increase (6)
|
ABS
|
•
|
Matrix pricing and
discounted cash flow |
|
•
|
Credit spreads (4)
|
|
111
|
-
|
1,879
|
|
327
|
|
30
|
-
|
1,878
|
|
145
|
|
Decrease (6)
|
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
—
|
-
|
106
|
|
101
|
|
—
|
-
|
110
|
|
101
|
|
Increase (6)
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (5)
|
|
—
|
-
|
106
|
|
99
|
|
56
|
-
|
106
|
|
98
|
|
Increase (6)
|
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate
|
•
|
Present value techniques
|
|
•
|
Swap yield (7)
|
|
267
|
-
|
353
|
|
|
|
248
|
-
|
450
|
|
|
|
Increase (12)
|
Foreign currency exchange rate
|
•
|
Present value techniques
|
|
•
|
Swap yield (7)
|
|
(19)
|
-
|
972
|
|
|
|
97
|
-
|
767
|
|
|
|
Increase (12)
|
|
|
|
|
•
|
Correlation (8)
|
|
39%
|
-
|
47%
|
|
|
|
38%
|
-
|
47%
|
|
|
|
|
Credit
|
•
|
Present value techniques
|
|
•
|
Credit spreads (9)
|
|
99
|
-
|
101
|
|
|
|
98
|
-
|
101
|
|
|
|
Decrease (9)
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity market
|
•
|
Present value techniques
or option pricing models |
|
•
|
Volatility (11)
|
|
11%
|
-
|
25%
|
|
|
|
13%
|
-
|
28%
|
|
|
|
Increase (12)
|
|
|
|
|
•
|
Correlation (8)
|
|
60%
|
-
|
60%
|
|
|
|
60%
|
-
|
60%
|
|
|
|
|
Embedded derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Direct and assumed guaranteed minimum benefits
|
•
|
Option pricing
techniques |
|
•
|
Mortality rates:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ages 0 - 40
|
|
0%
|
-
|
0.28%
|
|
|
|
0%
|
-
|
0.14%
|
|
|
|
Decrease (13)
|
|
|
|
|
|
Ages 41 - 60
|
|
0.04%
|
-
|
0.88%
|
|
|
|
0.04%
|
-
|
0.88%
|
|
|
|
Decrease (13)
|
|
|
|
|
|
Ages 61 - 115
|
|
0.26%
|
-
|
100%
|
|
|
|
0.26%
|
-
|
100%
|
|
|
|
Decrease (13)
|
|
|
|
|
•
|
Lapse rates:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Durations 1 - 10
|
|
0.50%
|
-
|
100%
|
|
|
|
0.50%
|
-
|
100%
|
|
|
|
Decrease (14)
|
|
|
|
|
|
Durations 11 - 20
|
|
2%
|
-
|
100%
|
|
|
|
2%
|
-
|
100%
|
|
|
|
Decrease (14)
|
|
|
|
|
|
Durations 21 - 116
|
|
2%
|
-
|
100%
|
|
|
|
2%
|
-
|
100%
|
|
|
|
Decrease (14)
|
|
|
|
|
•
|
Utilization rates
|
|
20%
|
-
|
50%
|
|
|
|
20%
|
-
|
50%
|
|
|
|
Increase (15)
|
|
|
|
|
•
|
Withdrawal rates
|
|
0%
|
-
|
20%
|
|
|
|
0%
|
-
|
40%
|
|
|
|
(16)
|
|
|
|
|
•
|
Long-term equity volatilities
|
|
7.56%
|
-
|
40%
|
|
|
|
9.14%
|
-
|
40%
|
|
|
|
Increase (17)
|
|
|
|
|
•
|
Nonperformance risk spread
|
|
(0.26)%
|
-
|
0.73%
|
|
|
|
(1.08)%
|
-
|
0.83%
|
|
|
|
Decrease (18)
|
(1)
|
The weighted average for fixed maturity securities is determined based on the estimated fair value of the securities.
|
(2)
|
The impact of a decrease in input would have the opposite impact on the estimated fair value. For embedded derivatives, changes are based on liability positions.
|
(3)
|
Significant increases (decreases) in expected default rates in isolation would result in substantially lower (higher) valuations.
|
(4)
|
Range and weighted average are presented in basis points.
|
(5)
|
Range and weighted average are presented in accordance with the market convention for fixed maturity securities of dollars per hundred dollars of par.
|
(6)
|
Changes in the assumptions used for the probability of default is accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumptions used for prepayment rates.
|
(7)
|
Ranges represent the rates across different yield curves and are presented in basis points. The swap yield curve is utilized among different types of derivatives to project cash flows, as well as to discount future cash flows to present value. Since this valuation methodology uses a range of inputs across a yield curve to value the derivative, presenting a range is more representative of the unobservable input used in the valuation.
|
(8)
|
Ranges represent the different correlation factors utilized as components within the valuation methodology. Presenting a range of correlation factors is more representative of the unobservable input used in the valuation. Increases (decreases) in correlation in isolation will increase (decrease) the significance of the change in valuations.
|
(9)
|
Represents the risk quoted in basis points of a credit default event on the underlying instrument. Credit derivatives with significant unobservable inputs are primarily comprised of written credit default swaps.
|
(10)
|
At both
June 30, 2014
and
December 31, 2013
, independent non-binding broker quotations were used in the determination of less than 1% of the total net derivative estimated fair value.
|
(11)
|
Ranges represent the underlying equity volatility quoted in percentage points. Since this valuation methodology uses a range of inputs across multiple volatility surfaces to value the derivative, presenting a range is more representative of the unobservable input used in the valuation.
|
(12)
|
Changes are based on long U.S. dollar net asset positions and will be inversely impacted for short U.S. dollar net asset positions.
|
(13)
|
Mortality rates vary by age and by demographic characteristics such as gender. Mortality rate assumptions are based on company experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative.
|
(14)
|
Base lapse rates are adjusted at the contract level based on a comparison of the actuarially calculated guaranteed values and the current policyholder account value, as well as other factors, such as the applicability of any surrender charges. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in the money contracts are less likely to lapse. Lapse rates are also generally assumed to be lower in periods when a surrender charge applies. For any given contract, lapse rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative.
|
(15)
|
The utilization rate assumption estimates the percentage of contract holders with a GMIB or lifetime withdrawal benefit who will elect to utilize the benefit upon becoming eligible. The rates may vary by the type of guarantee, the amount by which the guaranteed amount is greater than the account value, the contract’s withdrawal history and by the age of the policyholder. For any given contract, utilization rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative.
|
(16)
|
The withdrawal rate represents the percentage of account balance that any given policyholder will elect to withdraw from the contract each year. The withdrawal rate assumption varies by age and duration of the contract, and also by other factors such as benefit type. For any given contract, withdrawal rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. For GMWBs, any increase (decrease) in withdrawal rates results in an increase (decrease) in the estimated fair value of the guarantees. For GMABs and GMIBs, any increase (decrease) in withdrawal rates results in a decrease (increase) in the estimated fair value.
|
(17)
|
Long-term equity volatilities represent equity volatility beyond the period for which observable equity volatilities are available. For any given contract, long-term equity volatility rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative.
|
(18)
|
Nonperformance risk spread varies by duration and by currency. For any given contract, multiple nonperformance risk spreads will apply, depending on the duration of the cash flow being discounted for purposes of valuing the embedded derivative.
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Fixed Maturity Securities
|
||||||||||||||||||||||||||||||
|
|
U.S.
Corporate |
|
Foreign
Corporate |
|
Foreign
Government |
|
U.S.
Treasury and Agency |
|
RMBS
|
|
CMBS
|
|
ABS
|
|
State and
Political Subdivision |
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
7,378
|
|
|
$
|
6,501
|
|
|
$
|
1,545
|
|
|
$
|
45
|
|
|
$
|
3,439
|
|
|
$
|
682
|
|
|
$
|
2,800
|
|
|
$
|
21
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
4
|
|
|
(1
|
)
|
|
96
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
7
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
108
|
|
|
339
|
|
|
(91
|
)
|
|
—
|
|
|
81
|
|
|
(8
|
)
|
|
(3
|
)
|
|
—
|
|
||||||||
Purchases (3)
|
|
487
|
|
|
394
|
|
|
118
|
|
|
301
|
|
|
802
|
|
|
15
|
|
|
1,616
|
|
|
2
|
|
||||||||
Sales (3)
|
|
(455
|
)
|
|
(323
|
)
|
|
(96
|
)
|
|
(26
|
)
|
|
(209
|
)
|
|
(34
|
)
|
|
(259
|
)
|
|
—
|
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
253
|
|
|
223
|
|
|
284
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
121
|
|
|
12
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(413
|
)
|
|
(518
|
)
|
|
(184
|
)
|
|
—
|
|
|
(193
|
)
|
|
(60
|
)
|
|
(492
|
)
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
7,369
|
|
|
$
|
6,612
|
|
|
$
|
1,672
|
|
|
$
|
320
|
|
|
$
|
3,945
|
|
|
$
|
595
|
|
|
$
|
3,786
|
|
|
$
|
35
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
2
|
|
|
$
|
(2
|
)
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
|
Mortgage Loans
|
||||||||||||||||||||||||||||
|
|
Common
Stock
|
|
Non-
redeemable
Preferred
Stock
|
|
Actively
Traded
Securities
|
|
FVO
General
Account
Securities
|
|
FVO
Contractholder-
directed
Unit-linked
Investments
|
|
FVO Securities
Held by CSEs
|
|
Short-term
Investments
|
|
Residential
Mortgage
Loans -
FVO
|
|
Mortgage
Loans Held-
for-sale
|
||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||
Three Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Balance, beginning of period
|
|
$
|
203
|
|
|
$
|
441
|
|
|
$
|
11
|
|
|
$
|
29
|
|
|
$
|
624
|
|
|
$
|
11
|
|
|
$
|
1,032
|
|
|
$
|
352
|
|
|
$
|
—
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
6
|
|
|
—
|
|
|
1
|
|
|
8
|
|
|
—
|
|
|||||||||
Net investment gains (losses)
|
|
(2
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
OCI
|
|
40
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Purchases (3)
|
|
24
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
281
|
|
|
—
|
|
|
212
|
|
|
24
|
|
|
—
|
|
|||||||||
Sales (3)
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(270
|
)
|
|
—
|
|
|
(461
|
)
|
|
(3
|
)
|
|
—
|
|
|||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|||||||||
Transfers into Level 3 (4)
|
|
2
|
|
|
—
|
|
|
—
|
|
|
69
|
|
|
37
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Transfers out of Level 3 (4)
|
|
(79
|
)
|
|
(190
|
)
|
|
(8
|
)
|
|
—
|
|
|
(107
|
)
|
|
—
|
|
|
(538
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Balance, end of period
|
|
$
|
186
|
|
|
$
|
263
|
|
|
$
|
20
|
|
|
$
|
109
|
|
|
$
|
571
|
|
|
$
|
11
|
|
|
$
|
246
|
|
|
$
|
367
|
|
|
$
|
—
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
8
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
(2
|
)
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||
|
|
Net Derivatives (6)
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
Interest
Rate
|
|
Foreign
Currency
Exchange
Rate
|
|
Credit
|
|
Equity
Market
|
|
Net
Embedded
Derivatives (7)
|
|
Separate
Account
Assets (8)
|
|
Long-term
Debt of
CSEs — FVO
|
||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||
Three Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance, beginning of period
|
|
$
|
56
|
|
|
$
|
(13
|
)
|
|
$
|
20
|
|
|
$
|
(356
|
)
|
|
$
|
980
|
|
|
$
|
1,730
|
|
|
$
|
(15
|
)
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|||||||
Net derivative gains (losses)
|
|
9
|
|
|
6
|
|
|
(2
|
)
|
|
(45
|
)
|
|
255
|
|
|
—
|
|
|
—
|
|
|||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|||||||
OCI
|
|
11
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
—
|
|
|||||||
Purchases (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
131
|
|
|
—
|
|
|||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(104
|
)
|
|
—
|
|
|||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
58
|
|
|
—
|
|
|||||||
Settlements (3)
|
|
(40
|
)
|
|
3
|
|
|
—
|
|
|
—
|
|
|
(205
|
)
|
|
(27
|
)
|
|
—
|
|
|||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|||||||
Transfers out of Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(122
|
)
|
|
—
|
|
|||||||
Balance, end of period
|
|
$
|
36
|
|
|
$
|
(3
|
)
|
|
$
|
17
|
|
|
$
|
(395
|
)
|
|
$
|
1,020
|
|
|
$
|
1,691
|
|
|
$
|
(15
|
)
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
(1
|
)
|
|
$
|
4
|
|
|
$
|
(1
|
)
|
|
$
|
(46
|
)
|
|
$
|
262
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Fixed Maturity Securities
|
||||||||||||||||||||||||||||||
|
|
U.S.
Corporate
|
|
Foreign
Corporate
|
|
Foreign
Government
|
|
U.S.
Treasury
and Agency
|
|
RMBS
|
|
CMBS
|
|
ABS
|
|
State and
Political
Subdivision
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
6,426
|
|
|
$
|
5,825
|
|
|
$
|
2,203
|
|
|
$
|
115
|
|
|
$
|
2,426
|
|
|
$
|
1,084
|
|
|
$
|
3,766
|
|
|
$
|
53
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
4
|
|
|
4
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
(29
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
4
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(169
|
)
|
|
(168
|
)
|
|
(48
|
)
|
|
(2
|
)
|
|
14
|
|
|
(6
|
)
|
|
(37
|
)
|
|
(1
|
)
|
||||||||
Purchases (3)
|
|
553
|
|
|
642
|
|
|
234
|
|
|
—
|
|
|
524
|
|
|
184
|
|
|
359
|
|
|
17
|
|
||||||||
Sales (3)
|
|
(281
|
)
|
|
(135
|
)
|
|
(47
|
)
|
|
(42
|
)
|
|
(198
|
)
|
|
(113
|
)
|
|
(256
|
)
|
|
(5
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
121
|
|
|
201
|
|
|
3
|
|
|
16
|
|
|
49
|
|
|
46
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(707
|
)
|
|
(358
|
)
|
|
(376
|
)
|
|
(5
|
)
|
|
(86
|
)
|
|
(143
|
)
|
|
(79
|
)
|
|
(23
|
)
|
||||||||
Balance, end of period
|
|
$
|
5,918
|
|
|
$
|
6,008
|
|
|
$
|
1,971
|
|
|
$
|
82
|
|
|
$
|
2,735
|
|
|
$
|
1,050
|
|
|
$
|
3,758
|
|
|
$
|
41
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
3
|
|
|
$
|
4
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
(28
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
Mortgage Loans
|
|||||||||||||||||||||||||||||
|
|
Common
Stock
|
|
Non-
redeemable
Preferred
Stock
|
|
Actively
Traded
Securities
|
|
FVO
General
Account
Securities
|
|
FVO
Contractholder-
directed
Unit-linked
Investments
|
|
FVO Securities
Held by CSEs
|
|
Short-term
Investments
|
|
Residential
Mortgage
Loans - FVO
|
|
Mortgage
Loans Held-
for-sale
|
||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||
Three Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Balance, beginning of period
|
|
$
|
189
|
|
|
$
|
401
|
|
|
$
|
14
|
|
|
$
|
44
|
|
|
$
|
831
|
|
|
$
|
—
|
|
|
$
|
2,130
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
(17
|
)
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|||||||||
Net investment gains (losses)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
OCI
|
|
(4
|
)
|
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Purchases (3)
|
|
8
|
|
|
20
|
|
|
1
|
|
|
—
|
|
|
341
|
|
|
—
|
|
|
247
|
|
|
150
|
|
|
—
|
|
|||||||||
Sales (3)
|
|
(7
|
)
|
|
(22
|
)
|
|
(4
|
)
|
|
—
|
|
|
(481
|
)
|
|
—
|
|
|
(1,783
|
)
|
|
—
|
|
|
(2
|
)
|
|||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Transfers into Level 3 (4)
|
|
1
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
36
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Transfers out of Level 3 (4)
|
|
(4
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(117
|
)
|
|
—
|
|
|
(218
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Balance, end of period
|
|
$
|
183
|
|
|
$
|
408
|
|
|
$
|
11
|
|
|
$
|
46
|
|
|
$
|
593
|
|
|
$
|
—
|
|
|
$
|
344
|
|
|
$
|
150
|
|
|
$
|
—
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
(9
|
)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||
|
|
Net Derivatives (6)
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
Interest
Rate
|
|
Foreign
Currency
Exchange
Rate
|
|
Credit
|
|
Equity
Market
|
|
Net
Embedded
Derivatives (7)
|
|
Separate
Account
Assets (8)
|
|
Long-term
Debt of
CSEs — FVO
|
||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||
Three Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance, beginning of period
|
|
$
|
144
|
|
|
$
|
30
|
|
|
$
|
38
|
|
|
$
|
(139
|
)
|
|
$
|
(1,584
|
)
|
|
$
|
1,219
|
|
|
$
|
(31
|
)
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|||||||
Net derivative gains (losses)
|
|
(26
|
)
|
|
(25
|
)
|
|
(10
|
)
|
|
(33
|
)
|
|
1,031
|
|
|
—
|
|
|
—
|
|
|||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(33
|
)
|
|
—
|
|
|
—
|
|
|||||||
OCI
|
|
(7
|
)
|
|
2
|
|
|
(3
|
)
|
|
—
|
|
|
105
|
|
|
—
|
|
|
—
|
|
|||||||
Purchases (3)
|
|
—
|
|
|
2
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
117
|
|
|
—
|
|
|||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(39
|
)
|
|
—
|
|
|||||||
Issuances (3)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Settlements (3)
|
|
(12
|
)
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(197
|
)
|
|
(19
|
)
|
|
—
|
|
|||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|||||||
Transfers out of Level 3 (4)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(43
|
)
|
|
—
|
|
|||||||
Balance, end of period
|
|
$
|
98
|
|
|
$
|
6
|
|
|
$
|
25
|
|
|
$
|
(171
|
)
|
|
$
|
(678
|
)
|
|
$
|
1,225
|
|
|
$
|
(31
|
)
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
(21
|
)
|
|
$
|
(26
|
)
|
|
$
|
(10
|
)
|
|
$
|
(34
|
)
|
|
$
|
1,024
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
(31
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Fixed Maturity Securities
|
||||||||||||||||||||||||||||||
|
|
U.S.
Corporate |
|
Foreign
Corporate |
|
Foreign
Government |
|
U.S.
Treasury and Agency |
|
RMBS
|
|
CMBS
|
|
ABS
|
|
State and
Political Subdivision |
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Six Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
7,148
|
|
|
$
|
6,704
|
|
|
$
|
2,235
|
|
|
$
|
62
|
|
|
$
|
2,957
|
|
|
$
|
972
|
|
|
$
|
4,210
|
|
|
$
|
10
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
4
|
|
|
4
|
|
|
98
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
—
|
|
|
(1
|
)
|
|
(4
|
)
|
|
—
|
|
|
8
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
268
|
|
|
298
|
|
|
(77
|
)
|
|
—
|
|
|
68
|
|
|
(32
|
)
|
|
63
|
|
|
1
|
|
||||||||
Purchases (3)
|
|
863
|
|
|
716
|
|
|
179
|
|
|
301
|
|
|
1,176
|
|
|
61
|
|
|
2,098
|
|
|
2
|
|
||||||||
Sales (3)
|
|
(562
|
)
|
|
(240
|
)
|
|
(109
|
)
|
|
(1
|
)
|
|
(377
|
)
|
|
(172
|
)
|
|
(567
|
)
|
|
—
|
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
464
|
|
|
517
|
|
|
312
|
|
|
—
|
|
|
146
|
|
|
11
|
|
|
548
|
|
|
32
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(816
|
)
|
|
(1,386
|
)
|
|
(962
|
)
|
|
(42
|
)
|
|
(68
|
)
|
|
(245
|
)
|
|
(2,533
|
)
|
|
(10
|
)
|
||||||||
Balance, end of period
|
|
$
|
7,369
|
|
|
$
|
6,612
|
|
|
$
|
1,672
|
|
|
$
|
320
|
|
|
$
|
3,945
|
|
|
$
|
595
|
|
|
$
|
3,786
|
|
|
$
|
35
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
2
|
|
|
$
|
7
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
(7
|
)
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
|
|
|
Mortgage Loans
|
||||||||||||||||||||||||||
|
|
Common
Stock |
|
Non-
redeemable Preferred Stock |
|
Actively
Traded Securities |
|
FVO
General Account Securities |
|
FVO
Contractholder- directed Unit-linked Investments |
|
FVO Securities
Held by CSEs
|
|
Short-term
Investments |
|
Residential
Mortgage Loans - FVO |
|
Mortgage
Loans Held- for-sale |
||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Balance, beginning of period
|
|
$
|
177
|
|
|
$
|
395
|
|
|
$
|
12
|
|
|
$
|
29
|
|
|
$
|
603
|
|
|
$
|
—
|
|
|
$
|
254
|
|
|
$
|
338
|
|
|
$
|
—
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
12
|
|
|
—
|
|
|
1
|
|
|
11
|
|
|
—
|
|
|||||||||
Net investment gains (losses)
|
|
(2
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
OCI
|
|
43
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Purchases (3)
|
|
21
|
|
|
—
|
|
|
20
|
|
|
—
|
|
|
318
|
|
|
—
|
|
|
192
|
|
|
51
|
|
|
—
|
|
|||||||||
Sales (3)
|
|
(14
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(368
|
)
|
|
(1
|
)
|
|
(76
|
)
|
|
(8
|
)
|
|
—
|
|
|||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|
—
|
|
|||||||||
Transfers into Level 3 (4)
|
|
40
|
|
|
—
|
|
|
—
|
|
|
69
|
|
|
27
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Transfers out of Level 3 (4)
|
|
(79
|
)
|
|
(143
|
)
|
|
(7
|
)
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
(124
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Balance, end of period
|
|
$
|
186
|
|
|
$
|
263
|
|
|
$
|
20
|
|
|
$
|
109
|
|
|
$
|
571
|
|
|
$
|
11
|
|
|
$
|
246
|
|
|
$
|
367
|
|
|
$
|
—
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
11
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
(2
|
)
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||
|
|
Net Derivatives (6)
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
Interest
Rate |
|
Foreign
Currency Exchange Rate |
|
Credit
|
|
Equity
Market |
|
Net
Embedded Derivatives (7) |
|
Separate
Account Assets (8) |
|
Long-term
Debt of
CSEs — FVO
|
||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||
Six Months Ended June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance, beginning of period
|
|
$
|
13
|
|
|
$
|
(11
|
)
|
|
$
|
29
|
|
|
$
|
(317
|
)
|
|
$
|
1,258
|
|
|
$
|
1,465
|
|
|
$
|
(28
|
)
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
65
|
|
|
—
|
|
|||||||
Net derivative gains (losses)
|
|
15
|
|
|
8
|
|
|
(9
|
)
|
|
(87
|
)
|
|
160
|
|
|
—
|
|
|
—
|
|
|||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|||||||
OCI
|
|
49
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(24
|
)
|
|
—
|
|
|
—
|
|
|||||||
Purchases (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
348
|
|
|
—
|
|
|||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(192
|
)
|
|
—
|
|
|||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
82
|
|
|
—
|
|
|||||||
Settlements (3)
|
|
(41
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(397
|
)
|
|
(28
|
)
|
|
13
|
|
|||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|||||||
Transfers out of Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(51
|
)
|
|
—
|
|
|||||||
Balance, end of period
|
|
$
|
36
|
|
|
$
|
(3
|
)
|
|
$
|
17
|
|
|
$
|
(395
|
)
|
|
$
|
1,020
|
|
|
$
|
1,691
|
|
|
$
|
(15
|
)
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
(7
|
)
|
|
$
|
(87
|
)
|
|
$
|
168
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Fixed Maturity Securities
|
||||||||||||||||||||||||||||||
|
|
U.S.
Corporate |
|
Foreign
Corporate |
|
Foreign
Government |
|
U.S.
Treasury and Agency |
|
RMBS
|
|
CMBS
|
|
ABS
|
|
State and
Political Subdivision |
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Six Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
7,433
|
|
|
$
|
6,208
|
|
|
$
|
1,814
|
|
|
$
|
71
|
|
|
$
|
2,037
|
|
|
$
|
1,147
|
|
|
$
|
3,656
|
|
|
$
|
54
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
8
|
|
|
6
|
|
|
8
|
|
|
—
|
|
|
10
|
|
|
(1
|
)
|
|
8
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
(32
|
)
|
|
(23
|
)
|
|
5
|
|
|
—
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(9
|
)
|
|
(161
|
)
|
|
(47
|
)
|
|
(2
|
)
|
|
124
|
|
|
(49
|
)
|
|
(62
|
)
|
|
(1
|
)
|
||||||||
Purchases (3)
|
|
684
|
|
|
794
|
|
|
352
|
|
|
—
|
|
|
803
|
|
|
404
|
|
|
985
|
|
|
17
|
|
||||||||
Sales (3)
|
|
(659
|
)
|
|
(413
|
)
|
|
(74
|
)
|
|
(4
|
)
|
|
(168
|
)
|
|
(333
|
)
|
|
(420
|
)
|
|
(5
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
241
|
|
|
185
|
|
|
91
|
|
|
17
|
|
|
21
|
|
|
139
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(1,748
|
)
|
|
(588
|
)
|
|
(178
|
)
|
|
—
|
|
|
(94
|
)
|
|
(255
|
)
|
|
(409
|
)
|
|
(24
|
)
|
||||||||
Balance, end of period
|
|
$
|
5,918
|
|
|
$
|
6,008
|
|
|
$
|
1,971
|
|
|
$
|
82
|
|
|
$
|
2,735
|
|
|
$
|
1,050
|
|
|
$
|
3,758
|
|
|
$
|
41
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
7
|
|
|
$
|
5
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
(1
|
)
|
|
$
|
8
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
(34
|
)
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
|
|
|
Mortgage Loans
|
||||||||||||||||||||||||||
|
|
Common
Stock |
|
Non-
redeemable Preferred Stock |
|
Actively
Traded Securities |
|
FVO
General Account Securities |
|
FVO
Contractholder- directed Unit-linked Investments |
|
FVO Securities
Held by CSEs
|
|
Short-term
Investments |
|
Residential
Mortgage Loans - FVO |
|
Mortgage
Loans Held- for-sale |
||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Balance, beginning of period
|
|
$
|
190
|
|
|
$
|
419
|
|
|
$
|
6
|
|
|
$
|
32
|
|
|
$
|
937
|
|
|
$
|
—
|
|
|
$
|
429
|
|
|
$
|
—
|
|
|
$
|
49
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
(24
|
)
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|||||||||
Net investment gains (losses)
|
|
—
|
|
|
(29
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
OCI
|
|
(7
|
)
|
|
65
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|||||||||
Purchases (3)
|
|
12
|
|
|
23
|
|
|
3
|
|
|
—
|
|
|
340
|
|
|
—
|
|
|
332
|
|
|
150
|
|
|
—
|
|
|||||||||
Sales (3)
|
|
(9
|
)
|
|
(70
|
)
|
|
—
|
|
|
(5
|
)
|
|
(427
|
)
|
|
—
|
|
|
(400
|
)
|
|
—
|
|
|
(45
|
)
|
|||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|||||||||
Transfers into Level 3 (4)
|
|
1
|
|
|
—
|
|
|
2
|
|
|
14
|
|
|
58
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Transfers out of Level 3 (4)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(291
|
)
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Balance, end of period
|
|
$
|
183
|
|
|
$
|
408
|
|
|
$
|
11
|
|
|
$
|
46
|
|
|
$
|
593
|
|
|
$
|
—
|
|
|
$
|
344
|
|
|
$
|
150
|
|
|
$
|
—
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
(12
|
)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
(20
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||
|
|
Net Derivatives (6)
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
Interest
Rate
|
|
Foreign
Currency
Exchange
Rate
|
|
Credit
|
|
Equity
Market
|
|
Net
Embedded
Derivatives (7)
|
|
Separate
Account
Assets (8)
|
|
Long-term
Debt of
CSEs — FVO
|
||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||
Six Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance, beginning of period
|
|
$
|
177
|
|
|
$
|
37
|
|
|
$
|
43
|
|
|
$
|
128
|
|
|
$
|
(3,162
|
)
|
|
$
|
1,205
|
|
|
$
|
(44
|
)
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||||
Net derivative gains (losses)
|
|
(22
|
)
|
|
(34
|
)
|
|
(15
|
)
|
|
(305
|
)
|
|
2,721
|
|
|
—
|
|
|
—
|
|
|||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
(80
|
)
|
|
—
|
|
|
—
|
|
|||||||
OCI
|
|
(31
|
)
|
|
1
|
|
|
(3
|
)
|
|
—
|
|
|
209
|
|
|
—
|
|
|
—
|
|
|||||||
Purchases (3)
|
|
—
|
|
|
2
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
175
|
|
|
—
|
|
|||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(78
|
)
|
|
—
|
|
|||||||
Issuances (3)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Settlements (3)
|
|
(25
|
)
|
|
1
|
|
|
—
|
|
|
(7
|
)
|
|
(366
|
)
|
|
(28
|
)
|
|
14
|
|
|||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|||||||
Transfers out of Level 3 (4)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(56
|
)
|
|
—
|
|
|||||||
Balance, end of period
|
|
$
|
98
|
|
|
$
|
6
|
|
|
$
|
25
|
|
|
$
|
(171
|
)
|
|
$
|
(678
|
)
|
|
$
|
1,225
|
|
|
$
|
(31
|
)
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
Net derivative gains (losses)
|
|
$
|
(17
|
)
|
|
$
|
(34
|
)
|
|
$
|
(15
|
)
|
|
$
|
(305
|
)
|
|
$
|
2,707
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10
|
|
|
$
|
(77
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Amortization of premium/accretion of discount is included within net investment income. Impairments charged to net income (loss) on securities and mortgage loans held-for-sale are included in net investment gains (losses), while changes in estimated fair value of mortgage loans - FVO are included in net investment income. Lapses associated with net embedded derivatives are included in net derivative gains (losses).
|
(2)
|
Interest and dividend accruals, as well as cash interest coupons and dividends received, are excluded from the rollforward.
|
(3)
|
Items purchased/issued and then sold/settled in the same period are excluded from the rollforward. Fees attributed to embedded derivatives are included in settlements.
|
(4)
|
Gains and losses, in net income (loss) and OCI, are calculated assuming transfers into and/or out of Level 3 occurred at the beginning of the period. Items transferred into and then out of Level 3 in the same period are excluded from the rollforward.
|
(5)
|
Changes in unrealized gains (losses) included in net income (loss) relate to assets and liabilities still held at the end of the respective periods.
|
(6)
|
Freestanding derivative assets and liabilities are presented net for purposes of the rollforward.
|
(7)
|
Embedded derivative assets and liabilities are presented net for purposes of the rollforward.
|
(8)
|
Investment performance related to separate account assets is fully offset by corresponding amounts credited to contractholders within separate account liabilities. Therefore, such changes in estimated fair value are not recorded in net income. For the purpose of this disclosure, these changes are presented within net investment gains (losses).
|
|
|
Residential Mortgage
Loans — FVO (1)
|
|
Certain Assets
and Liabilities
of CSEs — FVO (2)
|
||||||||||||
|
|
June 30, 2014
|
|
December 31, 2013
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||
|
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Unpaid principal balance
|
|
$
|
546
|
|
|
$
|
508
|
|
|
$
|
582
|
|
|
$
|
1,528
|
|
Difference between estimated fair value and unpaid principal balance
|
|
(179
|
)
|
|
(170
|
)
|
|
56
|
|
|
70
|
|
||||
Carrying value at estimated fair value
|
|
$
|
367
|
|
|
$
|
338
|
|
|
$
|
638
|
|
|
$
|
1,598
|
|
Loans in non-accrual status
|
|
$
|
132
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Loans more than 90 days past due
|
|
$
|
87
|
|
|
$
|
81
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Loans in non-accrual status or more than 90 days past due, or both — difference between aggregate estimated fair value and unpaid principal balance
|
|
$
|
(103
|
)
|
|
$
|
(82
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Contractual principal balance
|
|
|
|
|
|
$
|
512
|
|
|
$
|
1,445
|
|
||||
Difference between estimated fair value and contractual principal balance
|
|
|
|
|
|
(7
|
)
|
|
10
|
|
||||||
Carrying value at estimated fair value
|
|
|
|
|
|
$
|
505
|
|
|
$
|
1,455
|
|
(1)
|
Interest income, changes in estimated fair value and gains or losses on sales are recognized in net investment income. Changes in estimated fair value for these loans were due to the following:
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
|
(In millions)
|
||||||||||||||
Instrument-specific credit risk based on changes in credit spreads for non-agency loans and adjustments in individual loan quality
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
5
|
|
|
$
|
—
|
|
Other changes in estimated fair value
|
|
3
|
|
|
—
|
|
|
4
|
|
|
—
|
|
||||
Total gains (losses) recognized in net investment income
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
(2)
|
These assets and liabilities are comprised of commercial mortgage loans and long-term debt. Changes in estimated fair value on these assets and liabilities and gains or losses on sales of these assets are recognized in net investment gains (losses). Interest income on commercial mortgage loans held by CSEs — FVO is recognized in net investment income. Interest expense from long-term debt of CSEs — FVO is recognized in other expenses.
|
|
At June 30,
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||
|
Carrying Value After Measurement
|
|
Gains (Losses)
|
||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Mortgage loans, net (1)
|
$
|
146
|
|
|
$
|
242
|
|
|
$
|
(1
|
)
|
|
$
|
10
|
|
|
$
|
(2
|
)
|
|
$
|
17
|
|
Other limited partnership interests (2)
|
$
|
69
|
|
|
$
|
70
|
|
|
$
|
(35
|
)
|
|
$
|
(39
|
)
|
|
$
|
(37
|
)
|
|
$
|
(39
|
)
|
Real estate joint ventures (3)
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
(1)
|
Estimated fair values for impaired mortgage loans are based on independent broker quotations or valuation models using unobservable inputs or, if the loans are in foreclosure or are otherwise determined to be collateral dependent, are based on the estimated fair value of the underlying collateral or the present value of the expected future cash flows.
|
(2)
|
For these cost method investments, estimated fair value is determined from information provided in the financial statements of the underlying entities including NAV data. These investments include private equity and debt funds that typically invest primarily in various strategies including domestic and international leveraged buyout funds; power, energy, timber and infrastructure development funds; venture capital funds; and below investment grade debt and mezzanine debt funds. Distributions will be generated from investment gains, from operating income from the underlying investments of the funds and from liquidation of the underlying assets of the funds. It is estimated that the underlying assets of the funds will be liquidated over the next
two
to
10 years
. Unfunded commitments for these investments at both
June 30, 2014
and
2013
were not significant.
|
(3)
|
For these cost method investments, estimated fair value is determined from information provided in the financial statements of the underlying entities including NAV data. These investments include several real estate funds that typically invest primarily in commercial real estate and mezzanine debt. Distributions will be generated from investment gains, from operating income from the underlying investments of the funds and from liquidation of the underlying assets of the funds. It is estimated that the underlying assets of the funds will be liquidated over the next
one
to
10 years
. Unfunded commitments for these investments at both
June 30, 2014
and
2013
were not significant.
|
|
June 30, 2014
|
||||||||||||||||||
|
|
|
Fair Value Hierarchy
|
|
|
||||||||||||||
|
Carrying
Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
Estimated
Fair Value
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage loans
|
$
|
56,218
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
59,194
|
|
|
$
|
59,194
|
|
Policy loans
|
$
|
11,785
|
|
|
$
|
—
|
|
|
$
|
1,689
|
|
|
$
|
11,769
|
|
|
$
|
13,458
|
|
Real estate joint ventures
|
$
|
92
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
171
|
|
|
$
|
171
|
|
Other limited partnership interests
|
$
|
847
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,085
|
|
|
$
|
1,085
|
|
Other invested assets
|
$
|
656
|
|
|
$
|
216
|
|
|
$
|
95
|
|
|
$
|
345
|
|
|
$
|
656
|
|
Premiums, reinsurance and other receivables
|
$
|
4,014
|
|
|
$
|
—
|
|
|
$
|
1,642
|
|
|
$
|
2,420
|
|
|
$
|
4,062
|
|
Other assets
|
$
|
1,057
|
|
|
$
|
—
|
|
|
$
|
974
|
|
|
$
|
76
|
|
|
$
|
1,050
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
PABs
|
$
|
138,216
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
144,112
|
|
|
$
|
144,112
|
|
Long-term debt
|
$
|
16,248
|
|
|
$
|
—
|
|
|
$
|
18,293
|
|
|
$
|
—
|
|
|
$
|
18,293
|
|
Collateral financing arrangements
|
$
|
4,196
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,993
|
|
|
$
|
3,993
|
|
Junior subordinated debt securities
|
$
|
3,193
|
|
|
$
|
—
|
|
|
$
|
4,131
|
|
|
$
|
—
|
|
|
$
|
4,131
|
|
Other liabilities
|
$
|
5,900
|
|
|
$
|
—
|
|
|
$
|
4,610
|
|
|
$
|
1,293
|
|
|
$
|
5,903
|
|
Separate account liabilities
|
$
|
119,236
|
|
|
$
|
—
|
|
|
$
|
119,236
|
|
|
$
|
—
|
|
|
$
|
119,236
|
|
|
December 31, 2013
|
||||||||||||||||||
|
|
|
Fair Value Hierarchy
|
|
|
||||||||||||||
|
Carrying
Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
Estimated
Fair Value
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage loans
|
$
|
55,770
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
57,924
|
|
|
$
|
57,924
|
|
Policy loans
|
$
|
11,764
|
|
|
$
|
—
|
|
|
$
|
1,694
|
|
|
$
|
11,512
|
|
|
$
|
13,206
|
|
Real estate joint ventures
|
$
|
102
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
169
|
|
|
$
|
169
|
|
Other limited partnership interests
|
$
|
950
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,109
|
|
|
$
|
1,109
|
|
Other invested assets
|
$
|
844
|
|
|
$
|
322
|
|
|
$
|
163
|
|
|
$
|
359
|
|
|
$
|
844
|
|
Premiums, reinsurance and other receivables
|
$
|
3,116
|
|
|
$
|
—
|
|
|
$
|
728
|
|
|
$
|
2,382
|
|
|
$
|
3,110
|
|
Other assets
|
$
|
324
|
|
|
$
|
—
|
|
|
$
|
210
|
|
|
$
|
142
|
|
|
$
|
352
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
PABs
|
$
|
139,735
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
144,631
|
|
|
$
|
144,631
|
|
Long-term debt
|
$
|
17,170
|
|
|
$
|
—
|
|
|
$
|
18,564
|
|
|
$
|
—
|
|
|
$
|
18,564
|
|
Collateral financing arrangements
|
$
|
4,196
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,984
|
|
|
$
|
3,984
|
|
Junior subordinated debt securities
|
$
|
3,193
|
|
|
$
|
—
|
|
|
$
|
3,789
|
|
|
$
|
—
|
|
|
$
|
3,789
|
|
Other liabilities
|
$
|
2,239
|
|
|
$
|
—
|
|
|
$
|
948
|
|
|
$
|
1,292
|
|
|
$
|
2,240
|
|
Separate account liabilities
|
$
|
117,562
|
|
|
$
|
—
|
|
|
$
|
117,562
|
|
|
$
|
—
|
|
|
$
|
117,562
|
|
|
Three Months
Ended June 30, 2014 |
||||||||||||||||||
|
Unrealized
Investment Gains
(Losses), Net of
Related Offsets (1)
|
|
Unrealized
Gains (Losses)
on Derivatives
|
|
Foreign
Currency
Translation
Adjustments
|
|
Defined
Benefit
Plans
Adjustment
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Balance, beginning of period
|
$
|
11,276
|
|
|
$
|
404
|
|
|
$
|
(1,843
|
)
|
|
$
|
(1,622
|
)
|
|
$
|
8,215
|
|
OCI before reclassifications
|
4,330
|
|
|
175
|
|
|
(5
|
)
|
|
6
|
|
|
4,506
|
|
|||||
Deferred income tax benefit (expense)
|
(1,336
|
)
|
|
(48
|
)
|
|
53
|
|
|
(2
|
)
|
|
(1,333
|
)
|
|||||
OCI before reclassifications, net of income tax
|
14,270
|
|
|
531
|
|
|
(1,795
|
)
|
|
(1,618
|
)
|
|
11,388
|
|
|||||
Amounts reclassified from AOCI
|
(176
|
)
|
|
(80
|
)
|
|
77
|
|
|
46
|
|
|
(133
|
)
|
|||||
Deferred income tax benefit (expense)
|
55
|
|
|
25
|
|
|
(27
|
)
|
|
(16
|
)
|
|
37
|
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(121
|
)
|
|
(55
|
)
|
|
50
|
|
|
30
|
|
|
(96
|
)
|
|||||
Sale of subsidiary (2)
|
(320
|
)
|
|
—
|
|
|
6
|
|
|
—
|
|
|
(314
|
)
|
|||||
Deferred income tax benefit (expense)
|
80
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|||||
Sale of subsidiary, net of income tax
|
(240
|
)
|
|
—
|
|
|
6
|
|
|
—
|
|
|
(234
|
)
|
|||||
Balance, end of period
|
$
|
13,909
|
|
|
$
|
476
|
|
|
$
|
(1,739
|
)
|
|
$
|
(1,588
|
)
|
|
$
|
11,058
|
|
|
Three Months
Ended June 30, 2013 |
||||||||||||||||||
|
Unrealized
Investment Gains
(Losses), Net of
Related Offsets (1)
|
|
Unrealized
Gains (Losses)
on Derivatives
|
|
Foreign
Currency
Translation
Adjustments
|
|
Defined
Benefit
Plans
Adjustment
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Balance, beginning of period
|
$
|
13,332
|
|
|
$
|
905
|
|
|
$
|
(1,205
|
)
|
|
$
|
(2,452
|
)
|
|
$
|
10,580
|
|
OCI before reclassifications
|
(5,320
|
)
|
|
(311
|
)
|
|
(633
|
)
|
|
2
|
|
|
(6,262
|
)
|
|||||
Deferred income tax benefit (expense)
|
1,844
|
|
|
96
|
|
|
13
|
|
|
—
|
|
|
1,953
|
|
|||||
OCI before reclassifications, net of income tax
|
9,856
|
|
|
690
|
|
|
(1,825
|
)
|
|
(2,450
|
)
|
|
6,271
|
|
|||||
Amounts reclassified from AOCI
|
(189
|
)
|
|
53
|
|
|
—
|
|
|
52
|
|
|
(84
|
)
|
|||||
Deferred income tax benefit (expense)
|
42
|
|
|
(9
|
)
|
|
—
|
|
|
(18
|
)
|
|
15
|
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(147
|
)
|
|
44
|
|
|
—
|
|
|
34
|
|
|
(69
|
)
|
|||||
Balance, end of period
|
$
|
9,709
|
|
|
$
|
734
|
|
|
$
|
(1,825
|
)
|
|
$
|
(2,416
|
)
|
|
$
|
6,202
|
|
|
Six Months
Ended June 30, 2014 |
||||||||||||||||||
|
Unrealized
Investment Gains
(Losses), Net of
Related Offsets (1)
|
|
Unrealized
Gains (Losses)
on Derivatives
|
|
Foreign
Currency
Translation
Adjustments
|
|
Defined
Benefit
Plans
Adjustment
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Balance, beginning of period
|
$
|
8,183
|
|
|
$
|
231
|
|
|
$
|
(1,659
|
)
|
|
$
|
(1,651
|
)
|
|
$
|
5,104
|
|
OCI before reclassifications
|
9,182
|
|
|
496
|
|
|
(222
|
)
|
|
6
|
|
|
9,462
|
|
|||||
Deferred income tax benefit (expense)
|
(2,981
|
)
|
|
(161
|
)
|
|
86
|
|
|
(2
|
)
|
|
(3,058
|
)
|
|||||
OCI before reclassifications, net of income tax
|
14,384
|
|
|
566
|
|
|
(1,795
|
)
|
|
(1,647
|
)
|
|
11,508
|
|
|||||
Amounts reclassified from AOCI
|
(349
|
)
|
|
(134
|
)
|
|
77
|
|
|
91
|
|
|
(315
|
)
|
|||||
Deferred income tax benefit (expense)
|
114
|
|
|
44
|
|
|
(27
|
)
|
|
(32
|
)
|
|
99
|
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(235
|
)
|
|
(90
|
)
|
|
50
|
|
|
59
|
|
|
(216
|
)
|
|||||
Sale of subsidiary (2)
|
(320
|
)
|
|
—
|
|
|
6
|
|
|
—
|
|
|
(314
|
)
|
|||||
Deferred income tax benefit (expense)
|
80
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|||||
Sale of subsidiary, net of income tax
|
(240
|
)
|
|
—
|
|
|
6
|
|
|
—
|
|
|
(234
|
)
|
|||||
Balance, end of period
|
$
|
13,909
|
|
|
$
|
476
|
|
|
$
|
(1,739
|
)
|
|
$
|
(1,588
|
)
|
|
$
|
11,058
|
|
|
Six Months
Ended June 30, 2013 |
||||||||||||||||||
|
Unrealized
Investment Gains
(Losses), Net of
Related Offsets (1)
|
|
Unrealized
Gains (Losses)
on Derivatives
|
|
Foreign
Currency
Translation
Adjustments
|
|
Defined
Benefit
Plans
Adjustment
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Balance, beginning of period
|
$
|
13,590
|
|
|
$
|
829
|
|
|
$
|
(533
|
)
|
|
$
|
(2,489
|
)
|
|
$
|
11,397
|
|
OCI before reclassifications
|
(5,494
|
)
|
|
(373
|
)
|
|
(1,230
|
)
|
|
2
|
|
|
(7,095
|
)
|
|||||
Deferred income tax benefit (expense)
|
1,919
|
|
|
118
|
|
|
(62
|
)
|
|
—
|
|
|
1,975
|
|
|||||
OCI before reclassifications, net of income tax
|
10,015
|
|
|
574
|
|
|
(1,825
|
)
|
|
(2,487
|
)
|
|
6,277
|
|
|||||
Amounts reclassified from AOCI
|
(469
|
)
|
|
234
|
|
|
—
|
|
|
107
|
|
|
(128
|
)
|
|||||
Deferred income tax benefit (expense)
|
163
|
|
|
(74
|
)
|
|
—
|
|
|
(36
|
)
|
|
53
|
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(306
|
)
|
|
160
|
|
|
—
|
|
|
71
|
|
|
(75
|
)
|
|||||
Balance, end of period
|
$
|
9,709
|
|
|
$
|
734
|
|
|
$
|
(1,825
|
)
|
|
$
|
(2,416
|
)
|
|
$
|
6,202
|
|
(1)
|
See
Note 6
for information on offsets to investments related to insurance liabilities, DAC and VOBA and the policyholder dividend obligation.
|
(2)
|
See
Note 3
.
|
AOCI Components
|
|
Amounts Reclassified from AOCI
|
|
Statement of Operations and
Comprehensive Income (Loss) Location
|
||||||||||||||
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
|
|
||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
||||||||
|
|
(In millions)
|
|
|
||||||||||||||
Net unrealized investment gains (losses):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net unrealized investment gains (losses)
|
|
$
|
86
|
|
|
$
|
171
|
|
|
$
|
194
|
|
|
$
|
461
|
|
|
Net investment gains (losses)
|
Net unrealized investment gains (losses)
|
|
59
|
|
|
22
|
|
|
85
|
|
|
43
|
|
|
Net investment income
|
||||
Net unrealized investment gains (losses)
|
|
37
|
|
|
—
|
|
|
72
|
|
|
—
|
|
|
Net derivative gains (losses)
|
||||
OTTI
|
|
(6
|
)
|
|
(4
|
)
|
|
(2
|
)
|
|
(35
|
)
|
|
Net investment gains (losses)
|
||||
Net unrealized investment gains (losses), before income tax
|
|
176
|
|
|
189
|
|
|
349
|
|
|
469
|
|
|
|
||||
Income tax (expense) benefit
|
|
(55
|
)
|
|
(42
|
)
|
|
(114
|
)
|
|
(163
|
)
|
|
|
||||
Net unrealized investment gains (losses), net of income tax
|
|
121
|
|
|
147
|
|
|
235
|
|
|
306
|
|
|
|
||||
Unrealized gains (losses) on derivatives - cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
12
|
|
|
10
|
|
|
27
|
|
|
14
|
|
|
Net derivative gains (losses)
|
||||
Interest rate swaps
|
|
2
|
|
|
2
|
|
|
4
|
|
|
4
|
|
|
Net investment income
|
||||
Interest rate forwards
|
|
2
|
|
|
3
|
|
|
2
|
|
|
6
|
|
|
Net derivative gains (losses)
|
||||
Interest rate forwards
|
|
1
|
|
|
—
|
|
|
2
|
|
|
1
|
|
|
Net investment income
|
||||
Interest rate forwards
|
|
1
|
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
Other expenses
|
||||
Foreign currency swaps
|
|
62
|
|
|
(68
|
)
|
|
98
|
|
|
(257
|
)
|
|
Net derivative gains (losses)
|
||||
Foreign currency swaps
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
Net investment income
|
||||
Foreign currency swaps
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
Other expenses
|
||||
Credit forwards
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
Net investment income
|
||||
Gains (losses) on cash flow hedges, before income tax
|
|
80
|
|
|
(53
|
)
|
|
134
|
|
|
(234
|
)
|
|
|
||||
Income tax (expense) benefit
|
|
(25
|
)
|
|
9
|
|
|
(44
|
)
|
|
74
|
|
|
|
||||
Gains (losses) on cash flow hedges, net of income tax
|
|
55
|
|
|
(44
|
)
|
|
90
|
|
|
(160
|
)
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign translation adjustment
|
|
(77
|
)
|
|
—
|
|
|
(77
|
)
|
|
—
|
|
|
Net investment gains (losses)
|
||||
Income tax (expense) benefit
|
|
27
|
|
|
—
|
|
|
27
|
|
|
—
|
|
|
|
||||
Foreign translation adjustment, net of income tax
|
|
(50
|
)
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
|
||||
Defined benefit plans adjustment: (1)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of net actuarial gains (losses)
|
|
(47
|
)
|
|
(70
|
)
|
|
(91
|
)
|
|
(141
|
)
|
|
|
||||
Amortization of prior service (costs) credit
|
|
1
|
|
|
18
|
|
|
—
|
|
|
34
|
|
|
|
||||
Amortization of defined benefit plan items, before income tax
|
|
(46
|
)
|
|
(52
|
)
|
|
(91
|
)
|
|
(107
|
)
|
|
|
||||
Income tax (expense) benefit
|
|
16
|
|
|
18
|
|
|
32
|
|
|
36
|
|
|
|
||||
Amortization of defined benefit plan items, net of income tax
|
|
(30
|
)
|
|
(34
|
)
|
|
(59
|
)
|
|
(71
|
)
|
|
|
||||
Total reclassifications, net of income tax
|
|
$
|
96
|
|
|
$
|
69
|
|
|
$
|
216
|
|
|
$
|
75
|
|
|
|
(1)
|
These AOCI components are included in the computation of net periodic benefit costs. See
Note 12
.
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Compensation
|
$
|
1,210
|
|
|
$
|
1,227
|
|
|
$
|
2,415
|
|
|
$
|
2,518
|
|
Pension, postretirement and postemployment benefit costs
|
117
|
|
|
122
|
|
|
237
|
|
|
245
|
|
||||
Commissions
|
1,302
|
|
|
1,387
|
|
|
2,590
|
|
|
2,775
|
|
||||
Volume-related costs
|
211
|
|
|
196
|
|
|
412
|
|
|
379
|
|
||||
Capitalization of DAC
|
(1,032
|
)
|
|
(1,212
|
)
|
|
(2,078
|
)
|
|
(2,468
|
)
|
||||
Amortization of DAC and VOBA
|
1,062
|
|
|
958
|
|
|
2,120
|
|
|
1,782
|
|
||||
Amortization of negative VOBA
|
(111
|
)
|
|
(138
|
)
|
|
(226
|
)
|
|
(284
|
)
|
||||
Interest expense on debt
|
312
|
|
|
321
|
|
|
624
|
|
|
642
|
|
||||
Premium taxes, licenses and fees
|
195
|
|
|
166
|
|
|
420
|
|
|
325
|
|
||||
Professional services
|
366
|
|
|
324
|
|
|
687
|
|
|
627
|
|
||||
Rent and related expenses, net of sublease income
|
93
|
|
|
101
|
|
|
178
|
|
|
194
|
|
||||
Other
|
497
|
|
|
573
|
|
|
1,006
|
|
|
1,428
|
|
||||
Total other expenses
|
$
|
4,222
|
|
|
$
|
4,025
|
|
|
$
|
8,385
|
|
|
$
|
8,163
|
|
|
Three Months
Ended June 30, |
||||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||||
|
Severance
|
|
Lease and
Asset
Impairment
|
|
Total
|
|
Severance
|
|
Lease and
Asset
Impairment
|
|
Total
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Balance, beginning of period
|
$
|
24
|
|
|
$
|
5
|
|
|
$
|
29
|
|
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
20
|
|
Restructuring charges
|
14
|
|
|
4
|
|
|
18
|
|
|
7
|
|
|
9
|
|
|
16
|
|
||||||
Cash payments
|
(22
|
)
|
|
(2
|
)
|
|
(24
|
)
|
|
(15
|
)
|
|
—
|
|
|
(15
|
)
|
||||||
Balance, end of period
|
$
|
16
|
|
|
$
|
7
|
|
|
$
|
23
|
|
|
$
|
12
|
|
|
$
|
9
|
|
|
$
|
21
|
|
|
Six Months
Ended June 30, |
||||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||||
|
Severance
|
|
Lease and
Asset
Impairment
|
|
Total
|
|
Severance
|
|
Lease and
Asset
Impairment
|
|
Total
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Balance, beginning of period
|
$
|
40
|
|
|
$
|
6
|
|
|
$
|
46
|
|
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
23
|
|
Restructuring charges
|
26
|
|
|
5
|
|
|
31
|
|
|
37
|
|
|
12
|
|
|
49
|
|
||||||
Cash payments
|
(50
|
)
|
|
(4
|
)
|
|
(54
|
)
|
|
(48
|
)
|
|
(3
|
)
|
|
(51
|
)
|
||||||
Balance, end of period
|
$
|
16
|
|
|
$
|
7
|
|
|
$
|
23
|
|
|
$
|
12
|
|
|
$
|
9
|
|
|
$
|
21
|
|
Total restructuring charges incurred since inception of initiative
|
$
|
267
|
|
|
$
|
39
|
|
|
$
|
306
|
|
|
$
|
178
|
|
|
$
|
30
|
|
|
$
|
208
|
|
|
Three Months
Ended June 30, |
||||||||||||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||||||||||||
|
Pension Benefits
|
|
Other Postretirement Benefits
|
|
Pension Benefits
|
|
Other Postretirement Benefits
|
||||||||||||||||||||||||
|
U.S. Plans
|
|
Non-U.S. Plans
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Service costs
|
$
|
50
|
|
|
$
|
14
|
|
|
$
|
4
|
|
|
$
|
1
|
|
|
$
|
59
|
|
|
$
|
17
|
|
|
$
|
5
|
|
|
$
|
1
|
|
Interest costs
|
109
|
|
|
4
|
|
|
23
|
|
|
—
|
|
|
97
|
|
|
3
|
|
|
23
|
|
|
—
|
|
||||||||
Expected return on plan assets
|
(118
|
)
|
|
(2
|
)
|
|
(18
|
)
|
|
(1
|
)
|
|
(121
|
)
|
|
(1
|
)
|
|
(19
|
)
|
|
—
|
|
||||||||
Amortization of net actuarial (gains) losses
|
44
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
57
|
|
|
—
|
|
|
13
|
|
|
—
|
|
||||||||
Amortization of prior service costs (credit)
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
||||||||
Net periodic benefit costs
|
$
|
85
|
|
|
$
|
16
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
92
|
|
|
$
|
19
|
|
|
$
|
4
|
|
|
$
|
1
|
|
|
Six Months
Ended June 30, |
||||||||||||||||||||||||||||||
|
2014
|
|
2013
|
||||||||||||||||||||||||||||
|
Pension Benefits
|
|
Other Postretirement Benefits
|
|
Pension Benefits
|
|
Other Postretirement Benefits
|
||||||||||||||||||||||||
|
U.S. Plans
|
|
Non-U.S. Plans
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Service costs
|
$
|
100
|
|
|
$
|
34
|
|
|
$
|
7
|
|
|
$
|
1
|
|
|
$
|
118
|
|
|
$
|
34
|
|
|
$
|
10
|
|
|
$
|
1
|
|
Interest costs
|
218
|
|
|
7
|
|
|
46
|
|
|
1
|
|
|
194
|
|
|
7
|
|
|
46
|
|
|
1
|
|
||||||||
Expected return on plan assets
|
(237
|
)
|
|
(4
|
)
|
|
(37
|
)
|
|
(1
|
)
|
|
(242
|
)
|
|
(3
|
)
|
|
(38
|
)
|
|
—
|
|
||||||||
Amortization of net actuarial (gains) losses
|
85
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
27
|
|
|
—
|
|
||||||||
Amortization of prior service costs (credit)
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
3
|
|
|
—
|
|
|
(37
|
)
|
|
—
|
|
||||||||
Net periodic benefit costs
|
$
|
167
|
|
|
$
|
37
|
|
|
$
|
21
|
|
|
$
|
1
|
|
|
$
|
187
|
|
|
$
|
38
|
|
|
$
|
8
|
|
|
$
|
2
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions, except share and per share data)
|
||||||||||||||
Weighted Average Shares
|
|
|
|
|
|
|
|
||||||||
Weighted average common stock outstanding for basic
earnings per common share
|
1,127,986,031
|
|
|
1,097,889,347
|
|
|
1,126,876,090
|
|
|
1,096,815,883
|
|
||||
Incremental common shares from assumed:
|
|
|
|
|
|
|
|
||||||||
Stock purchase contracts underlying common equity units (1)
|
3,756,390
|
|
|
—
|
|
|
3,571,043
|
|
|
—
|
|
||||
Exercise or issuance of stock-based awards
|
10,519,694
|
|
|
8,790,971
|
|
|
10,338,697
|
|
|
7,875,396
|
|
||||
Weighted average common stock outstanding for diluted
earnings per common share
|
1,142,262,115
|
|
|
1,106,680,318
|
|
|
1,140,785,830
|
|
|
1,104,691,279
|
|
||||
Income (Loss) from Continuing Operations
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations, net of income tax
|
$
|
1,376
|
|
|
$
|
508
|
|
|
$
|
2,718
|
|
|
$
|
1,503
|
|
Less: Income (loss) from continuing operations, net of income tax, attributable to noncontrolling interests
|
10
|
|
|
8
|
|
|
21
|
|
|
14
|
|
||||
Less: Preferred stock dividends
|
31
|
|
|
31
|
|
|
61
|
|
|
61
|
|
||||
Income (loss) from continuing operations, net of income tax,
available to MetLife, Inc.’s common shareholders
|
$
|
1,335
|
|
|
$
|
469
|
|
|
$
|
2,636
|
|
|
$
|
1,428
|
|
Basic
|
$
|
1.18
|
|
|
$
|
0.43
|
|
|
$
|
2.34
|
|
|
$
|
1.30
|
|
Diluted
|
$
|
1.17
|
|
|
$
|
0.43
|
|
|
$
|
2.31
|
|
|
$
|
1.29
|
|
Income (Loss) from Discontinued Operations
|
|
|
|
|
|
|
|
||||||||
Income (loss) from discontinued operations, net of income tax
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
(3
|
)
|
|
$
|
(1
|
)
|
Less: Income (loss) from discontinued operations, net of income tax, attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Income (loss) from discontinued operations, net of income tax,
available to MetLife, Inc.’s common shareholders
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
(3
|
)
|
|
$
|
(1
|
)
|
Basic
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Diluted
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net Income (Loss)
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
1,376
|
|
|
$
|
510
|
|
|
$
|
2,715
|
|
|
$
|
1,502
|
|
Less: Net income (loss) attributable to noncontrolling interests
|
10
|
|
|
8
|
|
|
21
|
|
|
14
|
|
||||
Less: Preferred stock dividends
|
31
|
|
|
31
|
|
|
61
|
|
|
61
|
|
||||
Net income (loss) available to MetLife, Inc.’s common shareholders
|
$
|
1,335
|
|
|
$
|
471
|
|
|
$
|
2,633
|
|
|
$
|
1,427
|
|
Basic
|
$
|
1.18
|
|
|
$
|
0.43
|
|
|
$
|
2.34
|
|
|
$
|
1.30
|
|
Diluted
|
$
|
1.17
|
|
|
$
|
0.43
|
|
|
$
|
2.31
|
|
|
$
|
1.29
|
|
(1)
|
See Note 15 of the Notes to the Consolidated Financial Statements included in the 2013 Annual Report for a description of the Company’s common equity units. For the three months and six months ended
June 30, 2013
, all shares related to the assumed issuance of shares in settlement of the applicable purchase contracts have been excluded from the calculation of diluted earnings per common share as these assumed shares are anti-dilutive.
|
|
Page
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Income (loss) from continuing operations, net of income tax
|
$
|
1,376
|
|
|
$
|
508
|
|
|
$
|
2,718
|
|
|
$
|
1,503
|
|
Less: Net investment gains (losses)
|
(125
|
)
|
|
110
|
|
|
(536
|
)
|
|
424
|
|
||||
Less: Net derivative gains (losses)
|
311
|
|
|
(1,690
|
)
|
|
654
|
|
|
(2,320
|
)
|
||||
Less: Other adjustments to continuing operations (1)
|
(475
|
)
|
|
(94
|
)
|
|
(777
|
)
|
|
(829
|
)
|
||||
Less: Provision for income tax (expense) benefit
|
44
|
|
|
566
|
|
|
164
|
|
|
955
|
|
||||
Operating earnings
|
1,621
|
|
|
1,616
|
|
|
3,213
|
|
|
3,273
|
|
||||
Less: Preferred stock dividends
|
31
|
|
|
31
|
|
|
61
|
|
|
61
|
|
||||
Operating earnings available to common shareholders
|
$
|
1,590
|
|
|
$
|
1,585
|
|
|
$
|
3,152
|
|
|
$
|
3,212
|
|
(1)
|
See definitions of operating revenues and operating expenses under “— Non-GAAP and Other Financial Disclosures” for the components of such adjustments.
|
•
|
Growth in premiums, fees and other revenues driven by:
|
-
|
Accelerated growth in Group, Voluntary & Worksite Benefits;
|
-
|
Increased fee revenue reflecting the benefit of higher equity markets on our separate account balances; and
|
-
|
Increases in our businesses outside of the U.S., notably accident & health, from continuing organic growth throughout our various geographic regions and leveraging of our multichannel distribution network.
|
•
|
Expanding our presence in emerging markets, including potential merger and acquisition activity. We expect that by 2016, 20% or more of our operating earnings will come from emerging markets, with the acquisition of ProVida contributing to this increase.
|
•
|
Focus on disciplined underwriting. We see no significant changes to the underlying trends that drive underwriting results; however, unanticipated catastrophes could result in a high volume of claims.
|
•
|
Focus on expense management in the light of the low interest rate environment, and continued focus on expense control throughout the Company.
|
•
|
Continued disciplined approach to investing and asset/liability management (“ALM”), through our enterprise risk and ALM governance process.
|
(i)
|
liabilities for future policyholder benefits and the accounting for reinsurance;
|
(ii)
|
capitalization and amortization of DAC and the establishment and amortization of VOBA;
|
(iii)
|
estimated fair values of investments in the absence of quoted market values;
|
(iv)
|
investment impairments;
|
(v)
|
estimated fair values of freestanding derivatives and the recognition and estimated fair value of embedded derivatives requiring bifurcation;
|
(vi)
|
measurement of goodwill and related impairment;
|
(vii)
|
measurement of employee benefit plan liabilities;
|
(viii)
|
measurement of income taxes and the valuation of deferred tax assets; and
|
(ix)
|
liabilities for litigation and regulatory matters.
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
9,873
|
|
|
$
|
9,158
|
|
|
$
|
19,092
|
|
|
$
|
18,309
|
|
Universal life and investment-type product policy fees
|
2,458
|
|
|
2,371
|
|
|
4,879
|
|
|
4,662
|
|
||||
Net investment income
|
5,259
|
|
|
5,282
|
|
|
10,294
|
|
|
11,359
|
|
||||
Other revenues
|
490
|
|
|
490
|
|
|
968
|
|
|
970
|
|
||||
Net investment gains (losses)
|
(125
|
)
|
|
110
|
|
|
(536
|
)
|
|
424
|
|
||||
Net derivative gains (losses)
|
311
|
|
|
(1,690
|
)
|
|
654
|
|
|
(2,320
|
)
|
||||
Total revenues
|
18,266
|
|
|
15,721
|
|
|
35,351
|
|
|
33,404
|
|
||||
Expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
10,385
|
|
|
9,289
|
|
|
20,012
|
|
|
18,997
|
|
||||
Interest credited to policyholder account balances
|
1,709
|
|
|
1,846
|
|
|
3,178
|
|
|
4,436
|
|
||||
Capitalization of DAC
|
(1,032
|
)
|
|
(1,212
|
)
|
|
(2,078
|
)
|
|
(2,468
|
)
|
||||
Amortization of DAC and VOBA
|
1,062
|
|
|
958
|
|
|
2,120
|
|
|
1,782
|
|
||||
Amortization of negative VOBA
|
(111
|
)
|
|
(138
|
)
|
|
(226
|
)
|
|
(284
|
)
|
||||
Interest expense on debt
|
312
|
|
|
321
|
|
|
624
|
|
|
642
|
|
||||
Other expenses
|
3,991
|
|
|
4,096
|
|
|
7,945
|
|
|
8,491
|
|
||||
Total expenses
|
16,316
|
|
|
15,160
|
|
|
31,575
|
|
|
31,596
|
|
||||
Income (loss) from continuing operations before provision for income tax
|
1,950
|
|
|
561
|
|
|
3,776
|
|
|
1,808
|
|
||||
Provision for income tax expense (benefit)
|
574
|
|
|
53
|
|
|
1,058
|
|
|
305
|
|
||||
Income (loss) from continuing operations, net of income tax
|
1,376
|
|
|
508
|
|
|
2,718
|
|
|
1,503
|
|
||||
Income (loss) from discontinued operations, net of income tax
|
—
|
|
|
2
|
|
|
(3
|
)
|
|
(1
|
)
|
||||
Net income (loss)
|
1,376
|
|
|
510
|
|
|
2,715
|
|
|
1,502
|
|
||||
Less: Net income (loss) attributable to noncontrolling interests
|
10
|
|
|
8
|
|
|
21
|
|
|
14
|
|
||||
Net income (loss) attributable to MetLife, Inc.
|
1,366
|
|
|
502
|
|
|
2,694
|
|
|
1,488
|
|
||||
Less: Preferred stock dividends
|
31
|
|
|
31
|
|
|
61
|
|
|
61
|
|
||||
Net income (loss) available to MetLife, Inc.’s common shareholders
|
$
|
1,335
|
|
|
$
|
471
|
|
|
$
|
2,633
|
|
|
$
|
1,427
|
|
|
Three Months
Ended June 30, |
||||||
|
2014
|
|
2013
|
||||
|
(In millions)
|
||||||
Non-VA program derivatives
|
|
|
|
||||
Interest rate
|
$
|
184
|
|
|
$
|
(951
|
)
|
Foreign currency exchange rate
|
(38
|
)
|
|
(408
|
)
|
||
Credit
|
33
|
|
|
15
|
|
||
Equity
|
(28
|
)
|
|
17
|
|
||
Non-VA embedded derivatives
|
(66
|
)
|
|
92
|
|
||
Total non-VA program derivatives
|
85
|
|
|
(1,235
|
)
|
||
VA program derivatives
|
|
|
|
||||
Market risks in embedded derivatives
|
380
|
|
|
1,312
|
|
||
Nonperformance risk on embedded derivatives
|
(51
|
)
|
|
(236
|
)
|
||
Other risks in embedded derivatives
|
(34
|
)
|
|
(89
|
)
|
||
Total embedded derivatives
|
295
|
|
|
987
|
|
||
Freestanding derivatives hedging embedded derivatives
|
(69
|
)
|
|
(1,442
|
)
|
||
Total VA program derivatives
|
226
|
|
|
(455
|
)
|
||
Net derivative gains (losses)
|
$
|
311
|
|
|
$
|
(1,690
|
)
|
•
|
Long-term interest rates decreased in the current period and increased in the prior period, contributing to a favorable change in our freestanding derivatives and an unfavorable change in our embedded derivatives.
|
•
|
Key equity index levels increased more in the current period than in the prior period, contributing to a favorable change in our embedded derivatives and an unfavorable change in our freestanding derivatives.
|
•
|
Key equity volatility measures decreased in the current period and increased in the prior period, contributing to a favorable change in our embedded derivatives and an unfavorable change in our freestanding derivatives.
|
•
|
Changes in foreign currency exchange rates contributed to a favorable change in our freestanding derivatives and an unfavorable change in our embedded derivatives.
|
•
|
Foreign currency translation adjustments caused by a strengthening of the Japanese yen resulted in a favorable change in the valuation of the embedded derivatives.
|
•
|
An increase in the risk margin adjustment caused by higher policyholder behavior risks resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
In-force changes and the mismatch of fund performance between actual and modeled funds resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
A combination of other factors, including the cross effect of capital markets changes and refinements to the valuation model, resulted in a favorable period over period change in the valuation of the embedded derivatives.
|
|
Six Months
Ended June 30, |
||||||
|
2014
|
|
2013
|
||||
|
(In millions)
|
||||||
Non-VA program derivatives
|
|
|
|
||||
Interest rate
|
$
|
420
|
|
|
$
|
(1,166
|
)
|
Foreign currency exchange rate
|
8
|
|
|
(812
|
)
|
||
Credit
|
44
|
|
|
59
|
|
||
Equity
|
(40
|
)
|
|
17
|
|
||
Non-VA embedded derivatives
|
(79
|
)
|
|
102
|
|
||
Total non-VA program derivatives
|
353
|
|
|
(1,800
|
)
|
||
VA program derivatives
|
|
|
|
||||
Market risks in embedded derivatives
|
354
|
|
|
3,186
|
|
||
Nonperformance risk on embedded derivatives
|
(8
|
)
|
|
(650
|
)
|
||
Other risks in embedded derivatives
|
(147
|
)
|
|
125
|
|
||
Total embedded derivatives
|
199
|
|
|
2,661
|
|
||
Freestanding derivatives hedging embedded derivatives
|
102
|
|
|
(3,181
|
)
|
||
Total VA program derivatives
|
301
|
|
|
(520
|
)
|
||
Net derivative gains (losses)
|
$
|
654
|
|
|
$
|
(2,320
|
)
|
•
|
Long-term interest rates decreased in the current period and increased in the prior period, contributing to a favorable change in our freestanding derivatives and an unfavorable change in our embedded derivatives.
|
•
|
Key equity index levels increased less in the current period than in the prior period contributing to a favorable change in our freestanding derivatives and an unfavorable change in our embedded derivatives.
|
•
|
Key equity volatility measures decreased in the current period and increased in the prior period, contributing to a favorable change in our embedded derivatives and an unfavorable change in our freestanding derivatives.
|
•
|
Changes in foreign currency exchange rates contributed to a favorable change in our freestanding derivatives and an unfavorable change in our embedded derivatives.
|
•
|
Foreign currency translation adjustments caused by a strengthening of the Japanese yen resulted in a favorable change in the valuation of the embedded derivatives.
|
•
|
An increase in the risk margin adjustment caused by higher policyholder behavior risks resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
In-force changes and the mismatch of fund performance between actual and modeled funds resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
The cross effect of capital markets changes and refinements to the valuation model resulted in a favorable period over period change in the valuation of embedded derivatives.
|
•
|
Other factors, including reserve changes influenced by benefit features and policyholder behavior, resulted in an unfavorable period over period change in the valuation of embedded derivatives.
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
$
|
627
|
|
|
$
|
230
|
|
|
$
|
306
|
|
|
$
|
46
|
|
|
$
|
333
|
|
|
$
|
137
|
|
|
$
|
(303
|
)
|
|
$
|
1,376
|
|
Less: Net investment gains (losses)
|
10
|
|
|
10
|
|
|
(195
|
)
|
|
(14
|
)
|
|
82
|
|
|
2
|
|
|
(20
|
)
|
|
(125
|
)
|
||||||||
Less: Net derivative gains (losses)
|
225
|
|
|
71
|
|
|
125
|
|
|
8
|
|
|
(35
|
)
|
|
49
|
|
|
(132
|
)
|
|
311
|
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(274
|
)
|
|
(42
|
)
|
|
(22
|
)
|
|
(146
|
)
|
|
(6
|
)
|
|
31
|
|
|
(16
|
)
|
|
(475
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
14
|
|
|
(14
|
)
|
|
24
|
|
|
38
|
|
|
(27
|
)
|
|
(38
|
)
|
|
47
|
|
|
44
|
|
||||||||
Operating earnings
|
$
|
652
|
|
|
$
|
205
|
|
|
$
|
374
|
|
|
$
|
160
|
|
|
$
|
319
|
|
|
$
|
93
|
|
|
(182
|
)
|
|
1,621
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
31
|
|
|
31
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(213
|
)
|
|
$
|
1,590
|
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
$
|
301
|
|
|
$
|
26
|
|
|
$
|
234
|
|
|
$
|
228
|
|
|
$
|
(34
|
)
|
|
$
|
69
|
|
|
$
|
(316
|
)
|
|
$
|
508
|
|
Less: Net investment gains (losses)
|
23
|
|
|
(28
|
)
|
|
(3
|
)
|
|
9
|
|
|
85
|
|
|
23
|
|
|
1
|
|
|
110
|
|
||||||||
Less: Net derivative gains (losses)
|
(421
|
)
|
|
(310
|
)
|
|
(209
|
)
|
|
(28
|
)
|
|
(486
|
)
|
|
(4
|
)
|
|
(232
|
)
|
|
(1,690
|
)
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(32
|
)
|
|
(45
|
)
|
|
39
|
|
|
171
|
|
|
(117
|
)
|
|
(21
|
)
|
|
(89
|
)
|
|
(94
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
150
|
|
|
134
|
|
|
61
|
|
|
(49
|
)
|
|
154
|
|
|
3
|
|
|
113
|
|
|
566
|
|
||||||||
Operating earnings
|
$
|
581
|
|
|
$
|
275
|
|
|
$
|
346
|
|
|
$
|
125
|
|
|
$
|
330
|
|
|
$
|
68
|
|
|
(109
|
)
|
|
1,616
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
31
|
|
|
31
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(140
|
)
|
|
$
|
1,585
|
|
(1)
|
See definitions of operating revenues and operating expenses under “— Non-GAAP and Other Financial Disclosures” for the components of such adjustments.
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
$
|
1,194
|
|
|
$
|
461
|
|
|
$
|
369
|
|
|
$
|
186
|
|
|
$
|
758
|
|
|
$
|
240
|
|
|
$
|
(490
|
)
|
|
$
|
2,718
|
|
Less: Net investment gains (losses)
|
16
|
|
|
(1
|
)
|
|
(736
|
)
|
|
15
|
|
|
239
|
|
|
(7
|
)
|
|
(62
|
)
|
|
(536
|
)
|
||||||||
Less: Net derivative gains (losses)
|
296
|
|
|
187
|
|
|
228
|
|
|
4
|
|
|
(42
|
)
|
|
87
|
|
|
(106
|
)
|
|
654
|
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(421
|
)
|
|
(81
|
)
|
|
(24
|
)
|
|
(233
|
)
|
|
(18
|
)
|
|
30
|
|
|
(30
|
)
|
|
(777
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
39
|
|
|
(37
|
)
|
|
172
|
|
|
57
|
|
|
(68
|
)
|
|
(51
|
)
|
|
52
|
|
|
164
|
|
||||||||
Operating earnings
|
$
|
1,264
|
|
|
$
|
393
|
|
|
$
|
729
|
|
|
$
|
343
|
|
|
$
|
647
|
|
|
$
|
181
|
|
|
(344
|
)
|
|
3,213
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
61
|
|
|
61
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(405
|
)
|
|
$
|
3,152
|
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
$
|
702
|
|
|
$
|
157
|
|
|
$
|
639
|
|
|
$
|
334
|
|
|
$
|
(111
|
)
|
|
$
|
152
|
|
|
$
|
(370
|
)
|
|
$
|
1,503
|
|
Less: Net investment gains (losses)
|
96
|
|
|
(11
|
)
|
|
19
|
|
|
9
|
|
|
213
|
|
|
39
|
|
|
59
|
|
|
424
|
|
||||||||
Less: Net derivative gains (losses)
|
(577
|
)
|
|
(439
|
)
|
|
(104
|
)
|
|
(19
|
)
|
|
(1,038
|
)
|
|
(10
|
)
|
|
(133
|
)
|
|
(2,320
|
)
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(296
|
)
|
|
(85
|
)
|
|
84
|
|
|
106
|
|
|
(386
|
)
|
|
(13
|
)
|
|
(239
|
)
|
|
(829
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
272
|
|
|
187
|
|
|
—
|
|
|
(30
|
)
|
|
437
|
|
|
(19
|
)
|
|
108
|
|
|
955
|
|
||||||||
Operating earnings
|
$
|
1,207
|
|
|
$
|
505
|
|
|
$
|
640
|
|
|
$
|
268
|
|
|
$
|
663
|
|
|
$
|
155
|
|
|
(165
|
)
|
|
3,273
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
61
|
|
|
61
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(226
|
)
|
|
$
|
3,212
|
|
(1)
|
See definitions of operating revenues and operating expenses under “— Non-GAAP and Other Financial Disclosures” for the components of such adjustments.
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Total revenues
|
$
|
5,509
|
|
|
$
|
4,820
|
|
|
$
|
2,203
|
|
|
$
|
1,452
|
|
|
$
|
3,100
|
|
|
$
|
1,192
|
|
|
$
|
(10
|
)
|
|
$
|
18,266
|
|
Less: Net investment gains (losses)
|
10
|
|
|
10
|
|
|
(195
|
)
|
|
(14
|
)
|
|
82
|
|
|
2
|
|
|
(20
|
)
|
|
(125
|
)
|
||||||||
Less: Net derivative gains (losses)
|
225
|
|
|
71
|
|
|
125
|
|
|
8
|
|
|
(35
|
)
|
|
49
|
|
|
(132
|
)
|
|
311
|
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(21
|
)
|
|
(42
|
)
|
|
14
|
|
|
20
|
|
|
(2
|
)
|
|
292
|
|
|
15
|
|
|
276
|
|
||||||||
Total operating revenues
|
$
|
5,296
|
|
|
$
|
4,781
|
|
|
$
|
2,259
|
|
|
$
|
1,438
|
|
|
$
|
3,054
|
|
|
$
|
846
|
|
|
$
|
127
|
|
|
$
|
17,801
|
|
Total expenses
|
$
|
4,557
|
|
|
$
|
4,465
|
|
|
$
|
1,720
|
|
|
$
|
1,408
|
|
|
$
|
2,613
|
|
|
$
|
1,000
|
|
|
$
|
553
|
|
|
$
|
16,316
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
63
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
3
|
|
|
—
|
|
|
63
|
|
||||||||
Less: Other adjustments to expenses (1)
|
189
|
|
|
—
|
|
|
36
|
|
|
166
|
|
|
8
|
|
|
261
|
|
|
31
|
|
|
691
|
|
||||||||
Total operating expenses
|
$
|
4,305
|
|
|
$
|
4,465
|
|
|
$
|
1,684
|
|
|
$
|
1,242
|
|
|
$
|
2,608
|
|
|
$
|
736
|
|
|
$
|
522
|
|
|
$
|
15,562
|
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Total revenues
|
$
|
4,627
|
|
|
$
|
4,161
|
|
|
$
|
1,871
|
|
|
$
|
1,216
|
|
|
$
|
3,210
|
|
|
$
|
702
|
|
|
$
|
(66
|
)
|
|
$
|
15,721
|
|
Less: Net investment gains (losses)
|
23
|
|
|
(28
|
)
|
|
(3
|
)
|
|
9
|
|
|
85
|
|
|
23
|
|
|
1
|
|
|
110
|
|
||||||||
Less: Net derivative gains (losses)
|
(421
|
)
|
|
(310
|
)
|
|
(209
|
)
|
|
(28
|
)
|
|
(486
|
)
|
|
(4
|
)
|
|
(232
|
)
|
|
(1,690
|
)
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
7
|
|
|
—
|
|
|
5
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(34
|
)
|
|
(45
|
)
|
|
46
|
|
|
4
|
|
|
436
|
|
|
(132
|
)
|
|
26
|
|
|
301
|
|
||||||||
Total operating revenues
|
$
|
5,063
|
|
|
$
|
4,544
|
|
|
$
|
2,037
|
|
|
$
|
1,231
|
|
|
$
|
3,173
|
|
|
$
|
808
|
|
|
$
|
139
|
|
|
$
|
16,995
|
|
Total expenses
|
$
|
4,173
|
|
|
$
|
4,130
|
|
|
$
|
1,510
|
|
|
$
|
903
|
|
|
$
|
3,236
|
|
|
$
|
640
|
|
|
$
|
568
|
|
|
$
|
15,160
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(112
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
9
|
|
|
—
|
|
|
(104
|
)
|
||||||||
Less: Other adjustments to expenses (1)
|
106
|
|
|
—
|
|
|
7
|
|
|
(167
|
)
|
|
556
|
|
|
(113
|
)
|
|
115
|
|
|
504
|
|
||||||||
Total operating expenses
|
$
|
4,179
|
|
|
$
|
4,130
|
|
|
$
|
1,503
|
|
|
$
|
1,070
|
|
|
$
|
2,681
|
|
|
$
|
744
|
|
|
$
|
453
|
|
|
$
|
14,760
|
|
(1)
|
See definitions of operating revenues and operating expenses under “— Non-GAAP and Other Financial Disclosures” for the components of such adjustments.
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Total revenues
|
$
|
10,792
|
|
|
$
|
9,625
|
|
|
$
|
3,641
|
|
|
$
|
2,792
|
|
|
$
|
6,201
|
|
|
$
|
2,159
|
|
|
$
|
141
|
|
|
$
|
35,351
|
|
Less: Net investment gains (losses)
|
16
|
|
|
(1
|
)
|
|
(736
|
)
|
|
15
|
|
|
239
|
|
|
(7
|
)
|
|
(62
|
)
|
|
(536
|
)
|
||||||||
Less: Net derivative gains (losses)
|
296
|
|
|
187
|
|
|
228
|
|
|
4
|
|
|
(42
|
)
|
|
87
|
|
|
(106
|
)
|
|
654
|
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(45
|
)
|
|
(81
|
)
|
|
54
|
|
|
24
|
|
|
(50
|
)
|
|
382
|
|
|
26
|
|
|
310
|
|
||||||||
Total operating revenues
|
$
|
10,526
|
|
|
$
|
9,520
|
|
|
$
|
4,095
|
|
|
$
|
2,749
|
|
|
$
|
6,053
|
|
|
$
|
1,691
|
|
|
$
|
283
|
|
|
$
|
34,917
|
|
Total expenses
|
$
|
8,979
|
|
|
$
|
8,916
|
|
|
$
|
3,053
|
|
|
$
|
2,593
|
|
|
$
|
5,101
|
|
|
$
|
1,824
|
|
|
$
|
1,109
|
|
|
$
|
31,575
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
61
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
7
|
|
|
—
|
|
|
64
|
|
||||||||
Less: Other adjustments to expenses (1)
|
314
|
|
|
—
|
|
|
78
|
|
|
257
|
|
|
(27
|
)
|
|
351
|
|
|
56
|
|
|
1,029
|
|
||||||||
Total operating expenses
|
$
|
8,604
|
|
|
$
|
8,916
|
|
|
$
|
2,975
|
|
|
$
|
2,336
|
|
|
$
|
5,132
|
|
|
$
|
1,466
|
|
|
$
|
1,053
|
|
|
$
|
30,482
|
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Total revenues
|
$
|
9,423
|
|
|
$
|
8,624
|
|
|
$
|
4,068
|
|
|
$
|
2,415
|
|
|
$
|
6,612
|
|
|
$
|
1,916
|
|
|
$
|
346
|
|
|
$
|
33,404
|
|
Less: Net investment gains (losses)
|
96
|
|
|
(11
|
)
|
|
19
|
|
|
9
|
|
|
213
|
|
|
39
|
|
|
59
|
|
|
424
|
|
||||||||
Less: Net derivative gains (losses)
|
(577
|
)
|
|
(439
|
)
|
|
(104
|
)
|
|
(19
|
)
|
|
(1,038
|
)
|
|
(10
|
)
|
|
(133
|
)
|
|
(2,320
|
)
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
5
|
|
|
—
|
|
|
2
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(71
|
)
|
|
(85
|
)
|
|
169
|
|
|
13
|
|
|
1,074
|
|
|
261
|
|
|
65
|
|
|
1,426
|
|
||||||||
Total operating revenues
|
$
|
9,981
|
|
|
$
|
9,159
|
|
|
$
|
3,984
|
|
|
$
|
2,412
|
|
|
$
|
6,360
|
|
|
$
|
1,621
|
|
|
$
|
355
|
|
|
$
|
33,872
|
|
Total expenses
|
$
|
8,365
|
|
|
$
|
8,398
|
|
|
$
|
3,083
|
|
|
$
|
1,974
|
|
|
$
|
6,837
|
|
|
$
|
1,715
|
|
|
$
|
1,224
|
|
|
$
|
31,596
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(176
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
5
|
|
|
—
|
|
|
(182
|
)
|
||||||||
Less: Other adjustments to expenses (1)
|
395
|
|
|
—
|
|
|
85
|
|
|
(93
|
)
|
|
1,474
|
|
|
274
|
|
|
304
|
|
|
2,439
|
|
||||||||
Total operating expenses
|
$
|
8,146
|
|
|
$
|
8,398
|
|
|
$
|
2,998
|
|
|
$
|
2,067
|
|
|
$
|
5,374
|
|
|
$
|
1,436
|
|
|
$
|
920
|
|
|
$
|
29,339
|
|
(1)
|
See definitions of operating revenues and operating expenses under “— Non-GAAP and Other Financial Disclosures” for the components of such adjustments.
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
9,853
|
|
|
$
|
9,157
|
|
|
$
|
19,070
|
|
|
$
|
18,260
|
|
Universal life and investment-type product policy fees
|
2,360
|
|
|
2,281
|
|
|
4,683
|
|
|
4,492
|
|
||||
Net investment income
|
5,095
|
|
|
5,057
|
|
|
10,180
|
|
|
10,139
|
|
||||
Other revenues
|
493
|
|
|
500
|
|
|
984
|
|
|
981
|
|
||||
Total operating revenues
|
17,801
|
|
|
16,995
|
|
|
34,917
|
|
|
33,872
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
9,964
|
|
|
9,174
|
|
|
19,337
|
|
|
18,199
|
|
||||
Interest credited to policyholder account balances
|
1,425
|
|
|
1,521
|
|
|
2,826
|
|
|
3,075
|
|
||||
Capitalization of DAC
|
(1,031
|
)
|
|
(1,212
|
)
|
|
(2,077
|
)
|
|
(2,468
|
)
|
||||
Amortization of DAC and VOBA
|
1,025
|
|
|
1,105
|
|
|
2,075
|
|
|
2,121
|
|
||||
Amortization of negative VOBA
|
(99
|
)
|
|
(124
|
)
|
|
(202
|
)
|
|
(255
|
)
|
||||
Interest expense on debt
|
299
|
|
|
287
|
|
|
593
|
|
|
575
|
|
||||
Other expenses
|
3,979
|
|
|
4,009
|
|
|
7,930
|
|
|
8,092
|
|
||||
Total operating expenses
|
15,562
|
|
|
14,760
|
|
|
30,482
|
|
|
29,339
|
|
||||
Provision for income tax expense (benefit)
|
618
|
|
|
619
|
|
|
1,222
|
|
|
1,260
|
|
||||
Operating earnings
|
1,621
|
|
|
1,616
|
|
|
3,213
|
|
|
3,273
|
|
||||
Less: Preferred stock dividends
|
31
|
|
|
31
|
|
|
61
|
|
|
61
|
|
||||
Operating earnings available to common shareholders
|
$
|
1,590
|
|
|
$
|
1,585
|
|
|
$
|
3,152
|
|
|
$
|
3,212
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
1,812
|
|
|
$
|
1,581
|
|
|
$
|
3,536
|
|
|
$
|
3,128
|
|
Universal life and investment-type product policy fees
|
1,256
|
|
|
1,238
|
|
|
2,503
|
|
|
2,405
|
|
||||
Net investment income
|
1,963
|
|
|
1,987
|
|
|
3,977
|
|
|
3,948
|
|
||||
Other revenues
|
265
|
|
|
257
|
|
|
510
|
|
|
500
|
|
||||
Total operating revenues
|
5,296
|
|
|
5,063
|
|
|
10,526
|
|
|
9,981
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
2,438
|
|
|
2,272
|
|
|
4,845
|
|
|
4,425
|
|
||||
Interest credited to policyholder account balances
|
561
|
|
|
589
|
|
|
1,116
|
|
|
1,168
|
|
||||
Capitalization of DAC
|
(249
|
)
|
|
(344
|
)
|
|
(483
|
)
|
|
(718
|
)
|
||||
Amortization of DAC and VOBA
|
378
|
|
|
396
|
|
|
807
|
|
|
727
|
|
||||
Interest expense on debt
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
Other expenses
|
1,177
|
|
|
1,265
|
|
|
2,319
|
|
|
2,543
|
|
||||
Total operating expenses
|
4,305
|
|
|
4,179
|
|
|
8,604
|
|
|
8,146
|
|
||||
Provision for income tax expense (benefit)
|
339
|
|
|
303
|
|
|
658
|
|
|
628
|
|
||||
Operating earnings
|
$
|
652
|
|
|
$
|
581
|
|
|
$
|
1,264
|
|
|
$
|
1,207
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
4,038
|
|
|
$
|
3,797
|
|
|
$
|
8,040
|
|
|
$
|
7,671
|
|
Universal life and investment-type product policy fees
|
181
|
|
|
170
|
|
|
358
|
|
|
350
|
|
||||
Net investment income
|
458
|
|
|
472
|
|
|
911
|
|
|
925
|
|
||||
Other revenues
|
104
|
|
|
105
|
|
|
211
|
|
|
213
|
|
||||
Total operating revenues
|
4,781
|
|
|
4,544
|
|
|
9,520
|
|
|
9,159
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
3,789
|
|
|
3,514
|
|
|
7,570
|
|
|
7,154
|
|
||||
Interest credited to policyholder account balances
|
39
|
|
|
39
|
|
|
79
|
|
|
78
|
|
||||
Capitalization of DAC
|
(36
|
)
|
|
(35
|
)
|
|
(70
|
)
|
|
(68
|
)
|
||||
Amortization of DAC and VOBA
|
35
|
|
|
33
|
|
|
71
|
|
|
67
|
|
||||
Interest expense on debt
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
Other expenses
|
638
|
|
|
578
|
|
|
1,266
|
|
|
1,166
|
|
||||
Total operating expenses
|
4,465
|
|
|
4,130
|
|
|
8,916
|
|
|
8,398
|
|
||||
Provision for income tax expense (benefit)
|
111
|
|
|
139
|
|
|
211
|
|
|
256
|
|
||||
Operating earnings
|
$
|
205
|
|
|
$
|
275
|
|
|
$
|
393
|
|
|
$
|
505
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
686
|
|
|
$
|
503
|
|
|
$
|
987
|
|
|
$
|
919
|
|
Universal life and investment-type product policy fees
|
55
|
|
|
65
|
|
|
112
|
|
|
133
|
|
||||
Net investment income
|
1,443
|
|
|
1,402
|
|
|
2,853
|
|
|
2,792
|
|
||||
Other revenues
|
75
|
|
|
67
|
|
|
143
|
|
|
140
|
|
||||
Total operating revenues
|
2,259
|
|
|
2,037
|
|
|
4,095
|
|
|
3,984
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
1,273
|
|
|
1,080
|
|
|
2,161
|
|
|
2,097
|
|
||||
Interest credited to policyholder account balances
|
287
|
|
|
305
|
|
|
565
|
|
|
648
|
|
||||
Capitalization of DAC
|
(18
|
)
|
|
(6
|
)
|
|
(19
|
)
|
|
(23
|
)
|
||||
Amortization of DAC and VOBA
|
6
|
|
|
6
|
|
|
10
|
|
|
17
|
|
||||
Interest expense on debt
|
2
|
|
|
2
|
|
|
4
|
|
|
4
|
|
||||
Other expenses
|
134
|
|
|
116
|
|
|
254
|
|
|
255
|
|
||||
Total operating expenses
|
1,684
|
|
|
1,503
|
|
|
2,975
|
|
|
2,998
|
|
||||
Provision for income tax expense (benefit)
|
201
|
|
|
188
|
|
|
391
|
|
|
346
|
|
||||
Operating earnings
|
$
|
374
|
|
|
$
|
346
|
|
|
$
|
729
|
|
|
$
|
640
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
780
|
|
|
$
|
710
|
|
|
$
|
1,448
|
|
|
$
|
1,385
|
|
Universal life and investment-type product policy fees
|
317
|
|
|
235
|
|
|
628
|
|
|
460
|
|
||||
Net investment income
|
332
|
|
|
281
|
|
|
657
|
|
|
558
|
|
||||
Other revenues
|
9
|
|
|
5
|
|
|
16
|
|
|
9
|
|
||||
Total operating revenues
|
1,438
|
|
|
1,231
|
|
|
2,749
|
|
|
2,412
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
743
|
|
|
601
|
|
|
1,347
|
|
|
1,155
|
|
||||
Interest credited to policyholder account balances
|
100
|
|
|
103
|
|
|
198
|
|
|
207
|
|
||||
Capitalization of DAC
|
(93
|
)
|
|
(108
|
)
|
|
(182
|
)
|
|
(213
|
)
|
||||
Amortization of DAC and VOBA
|
81
|
|
|
83
|
|
|
160
|
|
|
157
|
|
||||
Amortization of negative VOBA
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Interest expense on debt
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Other expenses
|
412
|
|
|
390
|
|
|
814
|
|
|
762
|
|
||||
Total operating expenses
|
1,242
|
|
|
1,070
|
|
|
2,336
|
|
|
2,067
|
|
||||
Provision for income tax expense (benefit)
|
36
|
|
|
36
|
|
|
70
|
|
|
77
|
|
||||
Operating earnings
|
$
|
160
|
|
|
$
|
125
|
|
|
$
|
343
|
|
|
$
|
268
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
1,913
|
|
|
$
|
1,980
|
|
|
$
|
3,803
|
|
|
$
|
3,978
|
|
Universal life and investment-type product policy fees
|
400
|
|
|
442
|
|
|
789
|
|
|
886
|
|
||||
Net investment income
|
717
|
|
|
723
|
|
|
1,410
|
|
|
1,455
|
|
||||
Other revenues
|
24
|
|
|
28
|
|
|
51
|
|
|
41
|
|
||||
Total operating revenues
|
3,054
|
|
|
3,173
|
|
|
6,053
|
|
|
6,360
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
1,425
|
|
|
1,433
|
|
|
2,822
|
|
|
2,848
|
|
||||
Interest credited to policyholder account balances
|
394
|
|
|
437
|
|
|
781
|
|
|
879
|
|
||||
Capitalization of DAC
|
(457
|
)
|
|
(522
|
)
|
|
(951
|
)
|
|
(1,068
|
)
|
||||
Amortization of DAC and VOBA
|
362
|
|
|
392
|
|
|
700
|
|
|
793
|
|
||||
Amortization of negative VOBA
|
(92
|
)
|
|
(113
|
)
|
|
(186
|
)
|
|
(226
|
)
|
||||
Other expenses
|
976
|
|
|
1,054
|
|
|
1,966
|
|
|
2,148
|
|
||||
Total operating expenses
|
2,608
|
|
|
2,681
|
|
|
5,132
|
|
|
5,374
|
|
||||
Provision for income tax expense (benefit)
|
127
|
|
|
162
|
|
|
274
|
|
|
323
|
|
||||
Operating earnings
|
$
|
319
|
|
|
$
|
330
|
|
|
$
|
647
|
|
|
$
|
663
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
584
|
|
|
$
|
558
|
|
|
$
|
1,181
|
|
|
$
|
1,125
|
|
Universal life and investment-type product policy fees
|
117
|
|
|
96
|
|
|
226
|
|
|
187
|
|
||||
Net investment income
|
134
|
|
|
120
|
|
|
257
|
|
|
248
|
|
||||
Other revenues
|
11
|
|
|
34
|
|
|
27
|
|
|
61
|
|
||||
Total operating revenues
|
846
|
|
|
808
|
|
|
1,691
|
|
|
1,621
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
271
|
|
|
256
|
|
|
532
|
|
|
493
|
|
||||
Interest credited to policyholder account balances
|
35
|
|
|
37
|
|
|
69
|
|
|
72
|
|
||||
Capitalization of DAC
|
(170
|
)
|
|
(192
|
)
|
|
(346
|
)
|
|
(369
|
)
|
||||
Amortization of DAC and VOBA
|
160
|
|
|
195
|
|
|
324
|
|
|
360
|
|
||||
Amortization of negative VOBA
|
(6
|
)
|
|
(11
|
)
|
|
(15
|
)
|
|
(28
|
)
|
||||
Interest expense on debt
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||
Other expenses
|
446
|
|
|
460
|
|
|
902
|
|
|
908
|
|
||||
Total operating expenses
|
736
|
|
|
744
|
|
|
1,466
|
|
|
1,436
|
|
||||
Provision for income tax expense (benefit)
|
17
|
|
|
(4
|
)
|
|
44
|
|
|
30
|
|
||||
Operating earnings
|
$
|
93
|
|
|
$
|
68
|
|
|
$
|
181
|
|
|
$
|
155
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
OPERATING REVENUES
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
40
|
|
|
$
|
28
|
|
|
$
|
75
|
|
|
$
|
54
|
|
Universal life and investment-type product policy fees
|
34
|
|
|
35
|
|
|
67
|
|
|
71
|
|
||||
Net investment income
|
48
|
|
|
72
|
|
|
115
|
|
|
213
|
|
||||
Other revenues
|
5
|
|
|
4
|
|
|
26
|
|
|
17
|
|
||||
Total operating revenues
|
127
|
|
|
139
|
|
|
283
|
|
|
355
|
|
||||
OPERATING EXPENSES
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
25
|
|
|
18
|
|
|
60
|
|
|
27
|
|
||||
Interest credited to policyholder account balances
|
9
|
|
|
11
|
|
|
18
|
|
|
23
|
|
||||
Capitalization of DAC
|
(8
|
)
|
|
(5
|
)
|
|
(26
|
)
|
|
(9
|
)
|
||||
Amortization for DAC and VOBA
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||
Interest expense on debt
|
297
|
|
|
283
|
|
|
589
|
|
|
569
|
|
||||
Other expenses
|
196
|
|
|
146
|
|
|
409
|
|
|
310
|
|
||||
Total operating expenses
|
522
|
|
|
453
|
|
|
1,053
|
|
|
920
|
|
||||
Provision for income tax expense (benefit)
|
(213
|
)
|
|
(205
|
)
|
|
(426
|
)
|
|
(400
|
)
|
||||
Operating earnings
|
(182
|
)
|
|
(109
|
)
|
|
(344
|
)
|
|
(165
|
)
|
||||
Less: Preferred stock dividends
|
31
|
|
|
31
|
|
|
61
|
|
|
61
|
|
||||
Operating earnings available to common shareholders
|
$
|
(213
|
)
|
|
$
|
(140
|
)
|
|
$
|
(405
|
)
|
|
$
|
(226
|
)
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Various business activities
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
23
|
|
|
$
|
33
|
|
Other net investment income
|
31
|
|
|
47
|
|
|
75
|
|
|
139
|
|
||||
Interest expense on debt
|
(193
|
)
|
|
(184
|
)
|
|
(383
|
)
|
|
(370
|
)
|
||||
Preferred stock dividends
|
(31
|
)
|
|
(31
|
)
|
|
(61
|
)
|
|
(61
|
)
|
||||
Acquisition costs
|
(3
|
)
|
|
(6
|
)
|
|
(5
|
)
|
|
(12
|
)
|
||||
Corporate initiatives and projects
|
(40
|
)
|
|
(15
|
)
|
|
(68
|
)
|
|
(44
|
)
|
||||
Incremental tax benefit
|
75
|
|
|
95
|
|
|
157
|
|
|
202
|
|
||||
Other
|
(66
|
)
|
|
(60
|
)
|
|
(143
|
)
|
|
(113
|
)
|
||||
Operating earnings available to common shareholders
|
$
|
(213
|
)
|
|
$
|
(140
|
)
|
|
$
|
(405
|
)
|
|
$
|
(226
|
)
|
•
|
credit risk, relating to the uncertainty associated with the continued ability of a given obligor to make timely payments of principal and interest;
|
•
|
interest rate risk, relating to the market price and cash flow variability associated with changes in market interest rates. Changes in market interest rates will impact the net unrealized gain or loss position of our fixed income investment portfolio and the rates of return we receive on both new funds invested and reinvestment of existing funds;
|
•
|
liquidity risk, relating to the diminished ability to sell certain investments, in times of strained market conditions;
|
•
|
market valuation risk, relating to the variability in the estimated fair value of investments associated with changes in market factors such as credit spreads. A widening of credit spreads will adversely impact the net unrealized gain (loss) position of the fixed income investment portfolio, will increase losses associated with credit-based non-qualifying derivatives where we assume credit exposure, and, if credit spreads widen significantly or for an extended period of time, will likely result in higher other-than-temporary impairment (“OTTI”). Credit spread tightening will reduce net investment income associated with purchases of fixed maturity securities and will favorably impact the net unrealized gain (loss) position of the fixed income investment portfolio;
|
•
|
currency risk, relating to the variability in currency exchange rates for foreign denominated investments. This risk relates to potential decreases in estimated fair value and net investment income resulting from changes in currency exchange rates versus the U.S. dollar. In general, the weakening of foreign currencies versus the U.S. dollar will adversely affect the estimated fair value of our foreign denominated investments; and
|
•
|
real estate risk, relating to commercial, agricultural and residential real estate, and stemming from factors, which include, but are not limited to, market conditions, including the demand and supply of leasable commercial space, creditworthiness of tenants and partners, capital markets volatility and the inherent interest rate movement.
|
|
Summary of Selected European Country Investment Exposure at June 30, 2014
|
||||||||||||||||||||||||||||||||||||
|
Fixed Maturity Securities (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
Sovereign
|
|
Financial
Services
|
|
Non-Financial Services
|
|
Total
|
|
All Other
General
Account
Investment
Exposure (2)
|
|
Total Exposure (3)
|
|
%
|
|
Purchased
Credit Default
Protection (4)
|
|
Net
Exposure
|
|
%
|
||||||||||||||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||||||||||||||||||||||||||
Europe’s perimeter region:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Portugal
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
13
|
|
|
1
|
%
|
|
$
|
—
|
|
|
$
|
13
|
|
|
1
|
%
|
Italy
|
8
|
|
|
134
|
|
|
598
|
|
|
740
|
|
|
67
|
|
|
807
|
|
|
33
|
|
|
1
|
|
|
808
|
|
|
33
|
|
||||||||
Ireland
|
—
|
|
|
—
|
|
|
30
|
|
|
30
|
|
|
747
|
|
|
777
|
|
|
31
|
|
|
—
|
|
|
777
|
|
|
31
|
|
||||||||
Greece
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
127
|
|
|
127
|
|
|
5
|
|
|
—
|
|
|
127
|
|
|
5
|
|
||||||||
Spain
|
3
|
|
|
103
|
|
|
531
|
|
|
637
|
|
|
62
|
|
|
699
|
|
|
28
|
|
|
—
|
|
|
699
|
|
|
28
|
|
||||||||
Total Europe’s perimeter region
|
11
|
|
|
237
|
|
|
1,159
|
|
|
1,407
|
|
|
1,016
|
|
|
2,423
|
|
|
98
|
|
|
1
|
|
|
2,424
|
|
|
98
|
|
||||||||
Cyprus
|
51
|
|
|
—
|
|
|
—
|
|
|
51
|
|
|
9
|
|
|
60
|
|
|
2
|
|
|
—
|
|
|
60
|
|
|
2
|
|
||||||||
Total
|
$
|
62
|
|
|
$
|
237
|
|
|
$
|
1,159
|
|
|
$
|
1,458
|
|
|
$
|
1,025
|
|
|
$
|
2,483
|
|
|
100
|
%
|
|
$
|
1
|
|
|
$
|
2,484
|
|
|
100
|
%
|
As percent of total cash and invested assets
|
0.0
|
%
|
|
0.1
|
%
|
|
0.2
|
%
|
|
0.3
|
%
|
|
0.2
|
%
|
|
0.5
|
%
|
|
|
|
0.0
|
%
|
|
0.5
|
%
|
|
|
||||||||||
Investment grade %
|
17
|
%
|
|
100
|
%
|
|
83
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Non-investment grade %
|
83
|
%
|
|
0
|
%
|
|
17
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The par value and amortized cost of the fixed maturity securities were both
$1.3 billion
at
June 30, 2014
.
|
(2)
|
Comprised of equity securities, mortgage loans, real estate and real estate joint ventures, other limited partnership interests, cash, cash equivalents and short-term investments, and other invested assets at carrying value. See Note 1 of the Notes to the Consolidated Financial Statements included in the
2013
Annual Report for an explanation of the carrying value for these invested asset classes. Excludes FVO contractholder-directed unit-linked investments of
$1.0 billion
. See “— FVO and Trading Securities.”
|
(3)
|
For Greece, the Company had
$1 million
of commitments to fund partnership investments at
June 30, 2014
.
|
(4)
|
Purchased credit default protection is stated at the estimated fair value of the swap. For Italy, the purchased credit default protection relates to financial services corporate securities and these swaps had a notional amount of
$80 million
and an estimated fair value of
($1) million
at
June 30, 2014
. The counterparties to these swaps are financial institutions with Standard & Poor’s Ratings Services (“S&P”) credit ratings of A as of
June 30, 2014
.
|
|
At or For the Three Months Ended June 30,
|
|
At or For the Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||||||||||
|
Yield % (1)
|
|
Amount
|
|
Yield % (1)
|
|
Amount
|
|
Yield % (1)
|
|
Amount
|
|
Yield % (1)
|
|
Amount
|
||||||||||||
|
|
|
(In millions)
|
|
|
|
(In millions)
|
|
|
|
(In millions)
|
|
|
|
(In millions)
|
||||||||||||
Fixed maturity securities (2)(3)
|
4.90
|
|
%
|
$
|
3,796
|
|
|
4.71
|
|
%
|
$
|
3,687
|
|
|
4.83
|
|
%
|
$
|
7,481
|
|
|
4.77
|
|
%
|
$
|
7,520
|
|
Mortgage loans (3)
|
5.05
|
|
%
|
708
|
|
|
5.40
|
|
%
|
716
|
|
|
5.06
|
|
%
|
1,417
|
|
|
5.46
|
|
%
|
1,454
|
|
||||
Real estate and real estate joint ventures
|
4.54
|
|
%
|
114
|
|
|
4.26
|
|
%
|
106
|
|
|
3.98
|
|
%
|
203
|
|
|
3.33
|
|
%
|
166
|
|
||||
Policy loans
|
5.36
|
|
%
|
158
|
|
|
5.18
|
|
%
|
152
|
|
|
5.35
|
|
%
|
315
|
|
|
5.20
|
|
%
|
307
|
|
||||
Equity securities
|
4.72
|
|
%
|
37
|
|
|
5.13
|
|
%
|
36
|
|
|
4.30
|
|
%
|
67
|
|
|
4.28
|
|
%
|
60
|
|
||||
Other limited partnerships
|
10.46
|
|
%
|
206
|
|
|
15.43
|
|
%
|
275
|
|
|
13.81
|
|
%
|
535
|
|
|
14.85
|
|
%
|
521
|
|
||||
Cash and short-term investments
|
1.05
|
|
%
|
39
|
|
|
1.10
|
|
%
|
42
|
|
|
1.11
|
|
%
|
84
|
|
|
0.98
|
|
%
|
87
|
|
||||
Other invested assets
|
|
|
|
200
|
|
|
|
|
|
222
|
|
|
|
|
|
420
|
|
|
|
|
|
401
|
|
||||
Total before investment fees and expenses
|
5.01
|
|
%
|
5,258
|
|
|
5.00
|
|
%
|
5,236
|
|
|
5.02
|
|
%
|
10,522
|
|
|
4.97
|
|
%
|
10,516
|
|
||||
Investment fees and expenses
|
(0.13
|
)
|
|
(139
|
)
|
|
(0.13
|
)
|
|
(131
|
)
|
|
(0.13
|
)
|
|
(275
|
)
|
|
(0.13
|
)
|
|
(274
|
)
|
||||
Net investment income including divested businesses (4), (5)
|
4.88
|
|
%
|
5,119
|
|
|
4.87
|
|
%
|
5,105
|
|
|
4.89
|
|
%
|
10,247
|
|
|
4.84
|
|
%
|
10,242
|
|
||||
Less: net investment income from divested businesses (4), (5)
|
|
|
24
|
|
|
|
|
48
|
|
|
|
|
67
|
|
|
|
|
103
|
|
||||||||
Net investment income (6)
|
|
|
$
|
5,095
|
|
|
|
|
$
|
5,057
|
|
|
|
|
$
|
10,180
|
|
|
|
|
$
|
10,139
|
|
(1)
|
Yields are calculated as investment income as a percent of average quarterly asset carrying values. Investment income excludes recognized gains and losses and reflects GAAP adjustments presented in footnote (6) below. Asset carrying values exclude unrealized gains (losses), collateral received in connection with our securities lending program, freestanding derivative assets, collateral received from derivative counterparties, the effects of consolidating certain variable interest entities (“VIEs”) under GAAP that are treated as consolidated securitization entities (“CSEs”) and contractholder-directed unit-linked investments. A yield is not presented for other invested assets, as it is not considered a meaningful measure of performance for this asset class.
|
(2)
|
Investment income (loss) includes amounts for FVO and trading securities of
$44 million
and
$81 million
for the
three months
and
six months ended
June 30, 2014
, respectively, and
($11) million
and
$10 million
for the
three months
and
six months ended
June 30, 2013
, respectively.
|
(3)
|
Investment income from fixed maturity securities and mortgage loans includes prepayment fees.
|
(4)
|
Yield calculations include the net investment income and ending carrying values of the divested businesses. The net investment income adjustment for divested businesses for the
three months
and
six months ended
June 30, 2014
was
$24 million
and
$67 million
, respectively, and $48 million and $103 million for the
three months
and
six months ended
June 30, 2013
, respectively. These amounts include scheduled periodic settlement payments on derivatives not qualifying for hedge accounting adjustment that are excluded in the scheduled periodic settlement payments on derivatives not qualifying for hedge accounting line in the GAAP net investment income reconciliation presented below. The scheduled periodic settlement payments excluded were $4 million and $1 million for the
three months
and
six months ended
June 30, 2014
, respectively, and $7 million for both the
three months
and
six months ended
June 30, 2013
.
|
(5)
|
Certain amounts in the prior periods have been reclassified to conform with the current period segment presentation. In the first quarter of 2014, MetLife, Inc. began reporting the operations of MAL as divested business. See “— Executive Summary.”
|
(6)
|
Net investment income presented in the yield table varies from the most directly comparable GAAP measure due to certain reclassifications and excludes the effects of consolidating certain VIEs under GAAP that are treated as CSEs and contractholder-directed unit-linked investments. Such reclassifications are presented in the table below.
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
|
(In millions)
|
||||||||||||||
Net investment income — in the above yield table
|
$
|
5,095
|
|
|
$
|
5,057
|
|
|
$
|
10,180
|
|
|
$
|
10,139
|
|
Real estate discontinued operations
|
—
|
|
|
(3
|
)
|
|
(1
|
)
|
|
(4
|
)
|
||||
Scheduled periodic settlement payments on derivatives not qualifying for hedge accounting
|
(169
|
)
|
|
(167
|
)
|
|
(344
|
)
|
|
(298
|
)
|
||||
Equity method operating joint ventures
|
1
|
|
|
(1
|
)
|
|
1
|
|
|
(1
|
)
|
||||
Contractholder-directed unit-linked investments
|
295
|
|
|
314
|
|
|
360
|
|
|
1,353
|
|
||||
Divested businesses
|
24
|
|
|
48
|
|
|
67
|
|
|
103
|
|
||||
Incremental net investment income from CSEs
|
13
|
|
|
34
|
|
|
31
|
|
|
67
|
|
||||
Net investment income — GAAP consolidated statements of operations
|
$
|
5,259
|
|
|
$
|
5,282
|
|
|
$
|
10,294
|
|
|
$
|
11,359
|
|
|
June 30, 2014
|
|
|||||||||||
|
Fixed Maturity
Securities
|
|
|
Equity
Securities
|
|
||||||||
|
(In millions)
|
|
|
|
|
(In millions)
|
|
|
|
||||
Level 1
|
|
|
|
|
|
|
|
|
|
||||
Quoted prices in active markets for identical assets
|
$
|
33,433
|
|
|
9.1
|
%
|
|
$
|
1,615
|
|
|
41.8
|
%
|
Level 2
|
|
|
|
|
|
|
|
|
|
||||
Independent pricing source
|
271,633
|
|
|
74.0
|
|
|
821
|
|
|
21.3
|
|
||
Internal matrix pricing or discounted cash flow techniques
|
37,656
|
|
|
10.3
|
|
|
978
|
|
|
25.3
|
|
||
Significant other observable inputs
|
309,289
|
|
|
84.3
|
|
|
1,799
|
|
|
46.6
|
|
||
Level 3
|
|
|
|
|
|
|
|
|
|
||||
Independent pricing source
|
6,617
|
|
|
1.8
|
|
|
248
|
|
|
6.4
|
|
||
Internal matrix pricing or discounted cash flow techniques
|
14,067
|
|
|
3.8
|
|
|
138
|
|
|
3.6
|
|
||
Independent broker quotations
|
3,650
|
|
|
1.0
|
|
|
63
|
|
|
1.6
|
|
||
Significant unobservable inputs
|
24,334
|
|
|
6.6
|
|
|
449
|
|
|
11.6
|
|
||
Total estimated fair value
|
$
|
367,056
|
|
|
100.0
|
%
|
|
$
|
3,863
|
|
|
100.0
|
%
|
•
|
The majority of the Level 3 fixed maturity and equity securities AFS were concentrated in four sectors: U.S. and foreign corporate securities, residential mortgage-backed securities (“RMBS”) and asset-backed securities (“ABS”).
|
•
|
Level 3 fixed maturity securities are priced principally through market standard valuation methodologies, independent pricing services and, to a much lesser extent, independent non-binding broker quotations using inputs that are not market observable or cannot be derived principally from or corroborated by observable market data. Level 3 fixed maturity securities consist of less liquid securities with very limited trading activity or where less price transparency exists around the inputs to the valuation methodologies. Level 3 fixed maturity securities include: alternative residential mortgage loan (“Alt-A”) and sub-prime RMBS; certain below investment grade private securities and less liquid investment grade corporate securities (included in U.S. and foreign corporate securities); less liquid ABS and foreign government securities.
|
•
|
During the
three months ended
June 30, 2014
, Level 3 fixed maturity securities increased by
$1.9 billion
, or
9%
. The increase was driven by purchases in excess of sales and an increase in estimated fair value recognized in other comprehensive income (loss) (“OCI”), partially offset by net transfers out of Level 3. The purchases in excess of sales were concentrated in ABS, RMBS and U.S Treasury and agency securities and the increase in estimated fair value recognized in OCI was concentrated in U.S. and foreign corporate securities. The net transfers out of Level 3 were concentrated in ABS, U.S. and foreign corporate securities and RMBS.
|
•
|
During the
six months ended
June 30, 2014
, Level 3 fixed maturity securities increased by
$36 million
, or less than
1%
. The increase was driven by purchases in excess of sales and an increase in estimated fair value recognized in OCI, partially offset by net transfers out of Level 3. The purchases in excess of sales were concentrated in ABS, RMBS, U.S. and foreign corporate securities and U.S Treasury and agency securities and the increase in estimated fair value recognized in OCI was concentrated in U.S. and foreign corporate securities and RMBS. The net transfers out of Level 3 were concentrated in ABS, U.S. and foreign corporate securities, foreign government securities and commercial mortgage-backed securities (“CMBS”).
|
|
|
|
|
June 30, 2014
|
|
|
December 31, 2013
|
|
||||||||||||||||||||||||
NAIC
Designation
|
|
NRSRO Rating
|
|
Amortized
Cost
|
|
Unrealized
Gain (Loss)
|
|
Estimated
Fair
Value
|
|
% of
Total
|
|
|
Amortized
Cost
|
|
Unrealized
Gain (Loss)
|
|
Estimated
Fair
Value
|
|
% of
Total
|
|
||||||||||||
|
|
|
|
(In millions)
|
|
|
(In millions)
|
|
||||||||||||||||||||||||
1
|
|
Aaa/Aa/A
|
|
$
|
236,269
|
|
|
$
|
19,291
|
|
|
$
|
255,560
|
|
|
69.6
|
%
|
|
$
|
230,429
|
|
|
$
|
11,640
|
|
|
$
|
242,069
|
|
|
69.1
|
%
|
2
|
|
Baa
|
|
78,827
|
|
|
7,574
|
|
|
86,401
|
|
|
23.6
|
|
|
79,732
|
|
|
4,382
|
|
|
84,114
|
|
|
24.0
|
|
||||||
|
|
Subtotal investment grade
|
|
315,096
|
|
|
26,865
|
|
|
341,961
|
|
|
93.2
|
|
|
310,161
|
|
|
16,022
|
|
|
326,183
|
|
|
93.1
|
|
||||||
3
|
|
Ba
|
|
14,198
|
|
|
596
|
|
|
14,794
|
|
|
4.0
|
|
|
13,239
|
|
|
358
|
|
|
13,597
|
|
|
3.9
|
|
||||||
4
|
|
B
|
|
8,998
|
|
|
279
|
|
|
9,277
|
|
|
2.5
|
|
|
9,216
|
|
|
162
|
|
|
9,378
|
|
|
2.7
|
|
||||||
5
|
|
Caa and lower
|
|
981
|
|
|
11
|
|
|
992
|
|
|
0.3
|
|
|
932
|
|
|
23
|
|
|
955
|
|
|
0.3
|
|
||||||
6
|
|
In or near default
|
|
14
|
|
|
18
|
|
|
32
|
|
|
—
|
|
|
51
|
|
|
23
|
|
|
74
|
|
|
—
|
|
||||||
|
|
Subtotal below investment grade
|
|
24,191
|
|
|
904
|
|
|
25,095
|
|
|
6.8
|
|
|
23,438
|
|
|
566
|
|
|
24,004
|
|
|
6.9
|
|
||||||
|
|
Total fixed maturity securities
|
|
$
|
339,287
|
|
|
$
|
27,769
|
|
|
$
|
367,056
|
|
|
100.0
|
%
|
|
$
|
333,599
|
|
|
$
|
16,588
|
|
|
$
|
350,187
|
|
|
100.0
|
%
|
|
Fixed Maturity Securities — by Sector & Credit Quality Rating
|
||||||||||||||||||||||||||
NAIC Designation:
|
1
|
|
2
|
|
3
|
|
4
|
|
5
|
|
6
|
|
Total
Estimated
Fair Value
|
||||||||||||||
NRSRO Rating:
|
Aaa/Aa/A
|
|
Baa
|
|
Ba
|
|
B
|
|
Caa and Lower
|
|
In or Near
Default
|
|
|||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||
June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
U.S. corporate
|
$
|
47,133
|
|
|
$
|
46,571
|
|
|
$
|
9,986
|
|
|
$
|
5,307
|
|
|
$
|
379
|
|
|
$
|
17
|
|
|
$
|
109,393
|
|
Foreign corporate
|
26,470
|
|
|
30,991
|
|
|
3,131
|
|
|
1,789
|
|
|
106
|
|
|
1
|
|
|
62,488
|
|
|||||||
Foreign government
|
48,760
|
|
|
5,779
|
|
|
661
|
|
|
1,267
|
|
|
160
|
|
|
—
|
|
|
56,627
|
|
|||||||
U.S. Treasury and agency
|
54,347
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
54,347
|
|
|||||||
RMBS
|
35,480
|
|
|
1,441
|
|
|
961
|
|
|
861
|
|
|
312
|
|
|
9
|
|
|
39,064
|
|
|||||||
CMBS
|
15,546
|
|
|
45
|
|
|
20
|
|
|
23
|
|
|
17
|
|
|
—
|
|
|
15,651
|
|
|||||||
ABS
|
13,643
|
|
|
1,068
|
|
|
24
|
|
|
30
|
|
|
18
|
|
|
5
|
|
|
14,788
|
|
|||||||
State and political subdivision
|
14,181
|
|
|
506
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,698
|
|
|||||||
Total fixed maturity securities
|
$
|
255,560
|
|
|
$
|
86,401
|
|
|
$
|
14,794
|
|
|
$
|
9,277
|
|
|
$
|
992
|
|
|
$
|
32
|
|
|
$
|
367,056
|
|
Percentage of total
|
69.6
|
%
|
|
23.6
|
%
|
|
4.0
|
%
|
|
2.5
|
%
|
|
0.3
|
%
|
|
—
|
%
|
|
100.0
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
U.S. corporate
|
$
|
46,038
|
|
|
$
|
45,639
|
|
|
$
|
9,349
|
|
|
$
|
4,998
|
|
|
$
|
415
|
|
|
$
|
30
|
|
|
$
|
106,469
|
|
Foreign corporate
|
27,957
|
|
|
30,477
|
|
|
2,762
|
|
|
1,910
|
|
|
45
|
|
|
1
|
|
|
63,152
|
|
|||||||
Foreign government
|
47,767
|
|
|
4,481
|
|
|
648
|
|
|
1,363
|
|
|
178
|
|
|
—
|
|
|
54,437
|
|
|||||||
U.S. Treasury and agency
|
45,123
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45,123
|
|
|||||||
RMBS
|
31,385
|
|
|
1,657
|
|
|
753
|
|
|
974
|
|
|
248
|
|
|
38
|
|
|
35,055
|
|
|||||||
CMBS
|
16,393
|
|
|
47
|
|
|
45
|
|
|
14
|
|
|
51
|
|
|
—
|
|
|
16,550
|
|
|||||||
ABS
|
14,184
|
|
|
1,215
|
|
|
30
|
|
|
119
|
|
|
18
|
|
|
5
|
|
|
15,571
|
|
|||||||
State and political subdivision
|
13,222
|
|
|
598
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,830
|
|
|||||||
Total fixed maturity securities
|
$
|
242,069
|
|
|
$
|
84,114
|
|
|
$
|
13,597
|
|
|
$
|
9,378
|
|
|
$
|
955
|
|
|
$
|
74
|
|
|
$
|
350,187
|
|
Percentage of total
|
69.1
|
%
|
|
24.0
|
%
|
|
3.9
|
%
|
|
2.7
|
%
|
|
0.3
|
%
|
|
—
|
%
|
|
100.0
|
%
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||
|
Estimated
Fair
Value
|
|
% of
Total
|
|
Estimated
Fair
Value
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Corporate fixed maturity securities — by sector:
|
|
|
|
|
|
|
|
||||||
Foreign corporate (1)
|
$
|
62,488
|
|
|
36.4
|
%
|
|
$
|
63,152
|
|
|
37.2
|
%
|
U.S. corporate fixed maturity securities — by industry:
|
|
|
|
|
|
|
|
||||||
Consumer
|
28,127
|
|
|
16.4
|
|
|
27,953
|
|
|
16.5
|
|
||
Industrial
|
28,109
|
|
|
16.3
|
|
|
27,462
|
|
|
16.2
|
|
||
Finance
|
20,807
|
|
|
12.1
|
|
|
20,135
|
|
|
11.9
|
|
||
Utility
|
19,974
|
|
|
11.6
|
|
|
19,066
|
|
|
11.2
|
|
||
Communications
|
8,383
|
|
|
4.9
|
|
|
8,074
|
|
|
4.8
|
|
||
Other
|
3,993
|
|
|
2.3
|
|
|
3,779
|
|
|
2.2
|
|
||
Total
|
$
|
171,881
|
|
|
100.0
|
%
|
|
$
|
169,621
|
|
|
100.0
|
%
|
(1)
|
Includes both U.S. dollar and foreign denominated securities.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||
|
Estimated
Fair
Value
|
|
% of
Total
|
|
Net
Unrealized
Gains (Losses)
|
|
Estimated
Fair
Value
|
|
% of
Total
|
|
Net
Unrealized
Gains (Losses)
|
||||||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
(In millions)
|
|
|
|
(In millions)
|
||||||||||
By security type:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Collateralized mortgage obligations
|
$
|
19,781
|
|
|
50.6
|
%
|
|
$
|
1,115
|
|
|
$
|
19,046
|
|
|
54.3
|
%
|
|
$
|
705
|
|
Pass-through securities
|
19,283
|
|
|
49.4
|
|
|
605
|
|
|
16,009
|
|
|
45.7
|
|
|
183
|
|
||||
Total RMBS
|
$
|
39,064
|
|
|
100.0
|
%
|
|
$
|
1,720
|
|
|
$
|
35,055
|
|
|
100.0
|
%
|
|
$
|
888
|
|
By risk profile:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
$
|
26,713
|
|
|
68.4
|
%
|
|
$
|
1,313
|
|
|
$
|
23,686
|
|
|
67.6
|
%
|
|
$
|
762
|
|
Prime
|
2,967
|
|
|
7.6
|
|
|
92
|
|
|
2,935
|
|
|
8.4
|
|
|
71
|
|
||||
Alt-A
|
5,469
|
|
|
14.0
|
|
|
161
|
|
|
4,986
|
|
|
14.2
|
|
|
(25
|
)
|
||||
Sub-prime
|
3,915
|
|
|
10.0
|
|
|
154
|
|
|
3,448
|
|
|
9.8
|
|
|
80
|
|
||||
Total RMBS
|
$
|
39,064
|
|
|
100.0
|
%
|
|
$
|
1,720
|
|
|
$
|
35,055
|
|
|
100.0
|
%
|
|
$
|
888
|
|
Ratings profile:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rated Aaa/AAA
|
$
|
27,591
|
|
|
70.6
|
%
|
|
|
|
$
|
24,764
|
|
|
70.6
|
%
|
|
|
||||
Designated NAIC 1
|
$
|
35,480
|
|
|
90.8
|
%
|
|
|
|
$
|
31,385
|
|
|
89.5
|
%
|
|
|
|
June 30, 2014
|
||||||||||||||||||||||||||||||||||||||||||||||
|
Aaa
|
|
Aa
|
|
A
|
|
Baa
|
|
Below
Investment
Grade
|
|
Total
|
||||||||||||||||||||||||||||||||||||
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
|
Amortized
Cost
|
|
Estimated
Fair
Value
|
||||||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||||||
2003 - 2004
|
$
|
1,013
|
|
|
$
|
1,030
|
|
|
$
|
123
|
|
|
$
|
126
|
|
|
$
|
129
|
|
|
$
|
131
|
|
|
$
|
51
|
|
|
$
|
52
|
|
|
$
|
21
|
|
|
$
|
21
|
|
|
$
|
1,337
|
|
|
$
|
1,360
|
|
2005
|
3,145
|
|
|
3,240
|
|
|
413
|
|
|
432
|
|
|
320
|
|
|
334
|
|
|
110
|
|
|
113
|
|
|
12
|
|
|
15
|
|
|
4,000
|
|
|
4,134
|
|
||||||||||||
2006
|
2,212
|
|
|
2,318
|
|
|
141
|
|
|
149
|
|
|
101
|
|
|
104
|
|
|
54
|
|
|
62
|
|
|
55
|
|
|
54
|
|
|
2,563
|
|
|
2,687
|
|
||||||||||||
2007
|
742
|
|
|
779
|
|
|
85
|
|
|
90
|
|
|
206
|
|
|
220
|
|
|
145
|
|
|
151
|
|
|
75
|
|
|
72
|
|
|
1,253
|
|
|
1,312
|
|
||||||||||||
2008 - 2011
|
569
|
|
|
607
|
|
|
24
|
|
|
24
|
|
|
95
|
|
|
97
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
12
|
|
|
700
|
|
|
740
|
|
||||||||||||
2012
|
452
|
|
|
505
|
|
|
229
|
|
|
235
|
|
|
920
|
|
|
934
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
17
|
|
|
1,618
|
|
|
1,691
|
|
||||||||||||
2013
|
732
|
|
|
748
|
|
|
408
|
|
|
419
|
|
|
1,513
|
|
|
1,545
|
|
|
13
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
2,666
|
|
|
2,724
|
|
||||||||||||
2014
|
161
|
|
|
164
|
|
|
276
|
|
|
281
|
|
|
545
|
|
|
558
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
982
|
|
|
1,003
|
|
||||||||||||
Total
|
$
|
9,026
|
|
|
$
|
9,391
|
|
|
$
|
1,699
|
|
|
$
|
1,756
|
|
|
$
|
3,829
|
|
|
$
|
3,923
|
|
|
$
|
373
|
|
|
$
|
390
|
|
|
$
|
192
|
|
|
$
|
191
|
|
|
$
|
15,119
|
|
|
$
|
15,651
|
|
Ratings Distribution
|
|
|
60.0
|
%
|
|
|
|
11.2
|
%
|
|
|
|
25.1
|
%
|
|
|
|
2.5
|
%
|
|
|
|
1.2
|
%
|
|
|
|
100.0
|
%
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
December 31, 2013
|
||||||||||||||||||||||||||||||||||||||||||||||
|
Aaa
|
|
Aa
|
|
A
|
|
Baa
|
|
Below
Investment
Grade
|
|
Total
|
||||||||||||||||||||||||||||||||||||
|
Amortized
Cost |
|
Estimated
Fair Value |
|
Amortized
Cost |
|
Estimated
Fair Value |
|
Amortized
Cost |
|
Estimated
Fair Value |
|
Amortized
Cost |
|
Estimated
Fair Value |
|
Amortized
Cost |
|
Estimated
Fair Value |
|
Amortized
Cost |
|
Estimated
Fair Value |
||||||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||||||
2003 - 2004
|
$
|
2,483
|
|
|
$
|
2,522
|
|
|
$
|
227
|
|
|
$
|
236
|
|
|
$
|
118
|
|
|
$
|
124
|
|
|
$
|
92
|
|
|
$
|
95
|
|
|
$
|
22
|
|
|
$
|
21
|
|
|
$
|
2,942
|
|
|
$
|
2,998
|
|
2005
|
3,294
|
|
|
3,442
|
|
|
363
|
|
|
387
|
|
|
372
|
|
|
393
|
|
|
102
|
|
|
110
|
|
|
29
|
|
|
36
|
|
|
4,160
|
|
|
4,368
|
|
||||||||||||
2006
|
2,355
|
|
|
2,466
|
|
|
246
|
|
|
260
|
|
|
145
|
|
|
156
|
|
|
16
|
|
|
21
|
|
|
36
|
|
|
37
|
|
|
2,798
|
|
|
2,940
|
|
||||||||||||
2007
|
782
|
|
|
814
|
|
|
65
|
|
|
70
|
|
|
208
|
|
|
220
|
|
|
184
|
|
|
187
|
|
|
75
|
|
|
69
|
|
|
1,314
|
|
|
1,360
|
|
||||||||||||
2008 - 2011
|
587
|
|
|
613
|
|
|
25
|
|
|
24
|
|
|
142
|
|
|
139
|
|
|
1
|
|
|
1
|
|
|
13
|
|
|
13
|
|
|
768
|
|
|
790
|
|
||||||||||||
2012
|
439
|
|
|
477
|
|
|
271
|
|
|
264
|
|
|
937
|
|
|
892
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
51
|
|
|
1,664
|
|
|
1,684
|
|
||||||||||||
2013
|
719
|
|
|
715
|
|
|
396
|
|
|
384
|
|
|
1,354
|
|
|
1,311
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,469
|
|
|
2,410
|
|
||||||||||||
Total
|
$
|
10,659
|
|
|
$
|
11,049
|
|
|
$
|
1,593
|
|
|
$
|
1,625
|
|
|
$
|
3,276
|
|
|
$
|
3,235
|
|
|
$
|
395
|
|
|
$
|
414
|
|
|
$
|
192
|
|
|
$
|
227
|
|
|
$
|
16,115
|
|
|
$
|
16,550
|
|
Ratings Distribution
|
|
|
66.8
|
%
|
|
|
|
9.8
|
%
|
|
|
|
19.5
|
%
|
|
|
|
2.5
|
%
|
|
|
|
1.4
|
%
|
|
|
|
100.0
|
%
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||
|
Estimated
Fair
Value
|
|
% of
Total
|
|
Net
Unrealized
Gains (Losses)
|
|
Estimated
Fair
Value
|
|
% of
Total
|
|
Net
Unrealized
Gains (Losses)
|
||||||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
(In millions)
|
|
|
|
(In millions)
|
||||||||||
By collateral type:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Collateralized debt obligations
|
$
|
4,379
|
|
|
29.6
|
%
|
|
$
|
(7
|
)
|
|
$
|
2,960
|
|
|
19.0
|
%
|
|
$
|
(6
|
)
|
Foreign residential loans
|
2,847
|
|
|
19.3
|
|
|
93
|
|
|
3,415
|
|
|
21.9
|
|
|
80
|
|
||||
Automobile loans
|
2,100
|
|
|
14.2
|
|
|
20
|
|
|
2,635
|
|
|
16.9
|
|
|
12
|
|
||||
Student loans
|
2,027
|
|
|
13.7
|
|
|
54
|
|
|
2,332
|
|
|
15.0
|
|
|
17
|
|
||||
Credit card loans
|
1,587
|
|
|
10.7
|
|
|
61
|
|
|
2,187
|
|
|
14.1
|
|
|
20
|
|
||||
Equipment loans
|
310
|
|
|
2.1
|
|
|
5
|
|
|
427
|
|
|
2.7
|
|
|
6
|
|
||||
Other loans
|
1,538
|
|
|
10.4
|
|
|
4
|
|
|
1,615
|
|
|
10.4
|
|
|
(16
|
)
|
||||
Total
|
$
|
14,788
|
|
|
100.0
|
%
|
|
$
|
230
|
|
|
$
|
15,571
|
|
|
100.0
|
%
|
|
$
|
113
|
|
Ratings profile:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rated Aaa/AAA
|
$
|
8,533
|
|
|
57.7
|
%
|
|
|
|
$
|
9,616
|
|
|
61.8
|
%
|
|
|
||||
Designated NAIC 1
|
$
|
13,643
|
|
|
92.3
|
%
|
|
|
|
$
|
14,184
|
|
|
91.1
|
%
|
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||||||||||||
|
Recorded
Investment
|
|
% of
Total
|
|
Valuation
Allowance
|
|
% of
Recorded Investment
|
|
Recorded
Investment
|
|
% of
Total
|
|
Valuation
Allowance
|
|
% of
Recorded Investment
|
||||||||||||||||
|
(Dollars in millions)
|
|
(Dollars in millions)
|
||||||||||||||||||||||||||||
Commercial
|
$
|
40,604
|
|
|
71.8
|
%
|
|
$
|
230
|
|
0.6
|
%
|
|
$
|
40,926
|
|
|
73.0
|
%
|
|
$
|
258
|
|
|
0.6
|
%
|
|||||
Agricultural
|
11,961
|
|
|
21.2
|
|
|
42
|
|
0.4
|
%
|
|
12,391
|
|
|
22.1
|
|
|
44
|
|
|
0.4
|
%
|
|||||||||
Residential
|
3,947
|
|
|
7.0
|
|
|
22
|
|
0.6
|
%
|
|
2,772
|
|
|
4.9
|
|
|
20
|
|
|
0.7
|
%
|
|||||||||
Total
|
$
|
56,512
|
|
|
100.0
|
%
|
|
$
|
294
|
|
0.5
|
%
|
|
$
|
56,089
|
|
|
100.0
|
%
|
|
$
|
322
|
|
|
0.6
|
%
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
|
Amount
|
|
% of
Total
|
|
Amount
|
|
% of
Total
|
||||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||||
Region
|
|
|
|
|
|
|
|
||||||||
Pacific
|
$
|
9,017
|
|
|
22.2
|
%
|
|
$
|
8,961
|
|
|
21.9
|
%
|
||
Middle Atlantic
|
7,232
|
|
|
17.8
|
|
|
7,367
|
|
|
18.0
|
|
||||
International
|
6,763
|
|
|
16.7
|
|
|
6,709
|
|
|
16.4
|
|
||||
South Atlantic
|
6,714
|
|
|
16.5
|
|
|
6,977
|
|
|
17.1
|
|
||||
West South Central
|
3,734
|
|
|
9.2
|
|
|
3,619
|
|
|
8.8
|
|
||||
East North Central
|
2,455
|
|
|
6.0
|
|
|
2,717
|
|
|
6.6
|
|
||||
New England
|
1,406
|
|
|
3.5
|
|
|
1,404
|
|
|
3.4
|
|
||||
Mountain
|
935
|
|
|
2.3
|
|
|
834
|
|
|
2.0
|
|
||||
East South Central
|
383
|
|
|
0.9
|
|
|
471
|
|
|
1.2
|
|
||||
West North Central
|
144
|
|
|
0.4
|
|
|
148
|
|
|
0.4
|
|
||||
Multi-Region and Other
|
1,821
|
|
|
4.5
|
|
|
1,719
|
|
|
4.2
|
|
||||
Total recorded investment
|
40,604
|
|
|
100.0
|
%
|
|
40,926
|
|
|
100.0
|
%
|
||||
Less: valuation allowances
|
230
|
|
|
|
|
258
|
|
|
|
||||||
Carrying value, net of valuation allowances
|
$
|
40,374
|
|
|
|
|
$
|
40,668
|
|
|
|
||||
Property Type
|
|
|
|
|
|
|
|
||||||||
Office
|
$
|
20,692
|
|
|
51.0
|
%
|
|
$
|
20,629
|
|
|
50.4
|
%
|
||
Retail
|
9,049
|
|
|
22.3
|
|
|
9,245
|
|
|
22.6
|
|
||||
Hotel
|
4,154
|
|
|
10.2
|
|
|
4,219
|
|
|
10.3
|
|
||||
Apartment
|
3,948
|
|
|
9.7
|
|
|
3,724
|
|
|
9.1
|
|
||||
Industrial
|
2,444
|
|
|
6.0
|
|
|
2,897
|
|
|
7.1
|
|
||||
Other
|
317
|
|
|
0.8
|
|
|
212
|
|
|
0.5
|
|
||||
Total recorded investment
|
40,604
|
|
|
100.0
|
%
|
|
40,926
|
|
|
100.0
|
%
|
||||
Less: valuation allowances
|
230
|
|
|
|
|
258
|
|
|
|
||||||
Carrying value, net of valuation allowances
|
$
|
40,374
|
|
|
|
|
$
|
40,668
|
|
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||
|
Carrying
Value
|
|
% of
Total
|
|
Carrying
Value
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Traditional
|
$
|
8,947
|
|
|
88.6
|
%
|
|
$
|
9,312
|
|
|
86.9
|
%
|
Real estate joint ventures and funds
|
691
|
|
|
6.8
|
|
|
769
|
|
|
7.2
|
|
||
Subtotal
|
9,638
|
|
|
95.4
|
|
|
10,081
|
|
|
94.1
|
|
||
Foreclosed (commercial, agricultural and residential)
|
414
|
|
|
4.1
|
|
|
445
|
|
|
4.2
|
|
||
Real estate held-for-investment
|
10,052
|
|
|
99.5
|
|
|
10,526
|
|
|
98.3
|
|
||
Real estate held-for-sale
|
49
|
|
|
0.5
|
|
|
186
|
|
|
1.7
|
|
||
Total real estate and real estate joint ventures
|
$
|
10,101
|
|
|
100.0
|
%
|
|
$
|
10,712
|
|
|
100.0
|
%
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||
|
Carrying
Value
|
|
% of
Total
|
|
Carrying
Value
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Freestanding derivatives with positive estimated fair values
|
$
|
9,252
|
|
|
54.1
|
%
|
|
$
|
8,595
|
|
|
53.0
|
%
|
Tax credit and renewable energy partnerships
|
2,710
|
|
|
15.8
|
|
|
2,657
|
|
|
16.3
|
|
||
Leveraged leases, net of non-recourse debt
|
1,881
|
|
|
11.0
|
|
|
1,946
|
|
|
12.0
|
|
||
Funds withheld
|
678
|
|
|
4.0
|
|
|
649
|
|
|
4.0
|
|
||
Joint venture investments
|
411
|
|
|
2.3
|
|
|
113
|
|
|
0.7
|
|
||
Other
|
2,184
|
|
|
12.8
|
|
|
2,269
|
|
|
14.0
|
|
||
Total
|
$
|
17,116
|
|
|
100.0
|
%
|
|
$
|
16,229
|
|
|
100.0
|
%
|
•
|
A comprehensive description of the nature of our derivatives, including the strategies for which derivatives are used in managing various risks.
|
•
|
Information about the notional amount, estimated fair value, and primary underlying risk exposure of our derivatives by type of hedge designation, excluding embedded derivatives held at
June 30, 2014
and
December 31, 2013
.
|
•
|
The statement of operations effects of derivatives in cash flow, fair value, or non-qualifying hedge relationships for the three months and six months ended
June 30, 2014
and
2013
.
|
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||
Credit Default Swaps
|
|
Notional
Amount
|
|
Estimated
Fair Value
|
|
Notional
Amount
|
|
Estimated
Fair Value
|
||||||||
|
|
(In millions)
|
||||||||||||||
Purchased (1)
|
|
$
|
3,675
|
|
|
$
|
(43
|
)
|
|
$
|
3,725
|
|
|
$
|
(44
|
)
|
Written (2)
|
|
9,982
|
|
|
173
|
|
|
9,055
|
|
|
165
|
|
||||
Total
|
|
$
|
13,657
|
|
|
$
|
130
|
|
|
$
|
12,780
|
|
|
$
|
121
|
|
(1)
|
The notional amount and estimated fair value for purchased credit default swaps in the trading portfolio were $290 million and ($8) million, respectively, at
June 30, 2014
and $355 million and ($10) million, respectively, at
December 31, 2013
.
|
(2)
|
The notional amount and estimated fair value for written credit default swaps in the trading portfolio were $15 million and $0, respectively, at
June 30, 2014
and $10 million and $0, respectively, at
December 31, 2013
.
|
|
|
Three Months
Ended June 30, |
|
Six Months
Ended June 30, |
||||||||||||||||||||||||||||||||||||||||||||
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||||||||||||||||||||||||||||||||||
Credit Default Swaps
|
|
Gross
Gains
(1)
|
|
Gross
Losses
(1)
|
|
Net
Gains
(Losses)
|
|
Gross
Gains
(1)
|
|
Gross
Losses
(1)
|
|
Net
Gains
(Losses)
|
|
Gross
Gains
(1)
|
|
Gross
Losses
(1)
|
|
Net
Gains
(Losses)
|
|
Gross
Gains
(1)
|
|
Gross
Losses
(1)
|
|
Net
Gains
(Losses)
|
||||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||||||
Purchased (2), (4)
|
|
$
|
3
|
|
|
$
|
(11
|
)
|
|
$
|
(8
|
)
|
|
$
|
5
|
|
|
$
|
(5
|
)
|
|
$
|
—
|
|
|
$
|
12
|
|
|
$
|
(18
|
)
|
|
$
|
(6
|
)
|
|
$
|
10
|
|
|
$
|
(19
|
)
|
|
$
|
(9
|
)
|
Written (3), (4)
|
|
28
|
|
|
(6
|
)
|
|
22
|
|
|
6
|
|
|
(11
|
)
|
|
(5
|
)
|
|
35
|
|
|
(22
|
)
|
|
13
|
|
|
52
|
|
|
(25
|
)
|
|
27
|
|
||||||||||||
Total
|
|
$
|
31
|
|
|
$
|
(17
|
)
|
|
$
|
14
|
|
|
$
|
11
|
|
|
$
|
(16
|
)
|
|
$
|
(5
|
)
|
|
$
|
47
|
|
|
$
|
(40
|
)
|
|
$
|
7
|
|
|
$
|
62
|
|
|
$
|
(44
|
)
|
|
$
|
18
|
|
(1)
|
Gains (losses) are reported in net derivative gains (losses), except for gains (losses) on the trading portfolio, which are reported in net investment income.
|
(2)
|
The gross gains and gross (losses) for purchased credit default swaps in the trading portfolio were $1 million and ($2) million, respectively, for the
three months ended
June 30, 2014
and $3 million and ($3) million, respectively, for the
six months ended
June 30, 2014
. The gross gains and gross (losses) for purchased credit default swaps in the trading portfolio were $2 million and ($3) million, respectively, for the
three months ended
June 30, 2013
and $3 million and ($7) million, respectively, for the
six months ended
June 30, 2013
.
|
(3)
|
The gross gains and gross (losses) for written credit default swaps in the trading portfolio were not significant for both the three months and six months ended
June 30, 2014
and
2013
.
|
(4)
|
Gains (losses) do not include earned income (expense) on credit default swaps.
|
|
June 30, 2014
|
||||||
Guaranteed Minimum Crediting Rate
|
Account
Value (1)
|
|
Account
Value at
Guarantee (1)
|
||||
|
(In millions)
|
||||||
Life & Other
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
125
|
|
|
$
|
125
|
|
Equal to 2% but less than 4%
|
$
|
11,689
|
|
|
$
|
4,897
|
|
Equal to or greater than 4%
|
$
|
10,753
|
|
|
$
|
6,778
|
|
Annuities
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
3,310
|
|
|
$
|
2,414
|
|
Equal to 2% but less than 4%
|
$
|
32,931
|
|
|
$
|
26,804
|
|
Equal to or greater than 4%
|
$
|
2,609
|
|
|
$
|
2,594
|
|
(1)
|
These amounts are not adjusted for policy loans.
|
|
June 30, 2014
|
||||||
Guaranteed Minimum Crediting Rate
|
Account
Value (1)
|
|
Account
Value at
Guarantee (1)
|
||||
|
(In millions)
|
||||||
Greater than 0% but less than 2%
|
$
|
4,973
|
|
|
$
|
4,973
|
|
Equal to 2% but less than 4%
|
$
|
2,221
|
|
|
$
|
2,200
|
|
Equal to or greater than 4%
|
$
|
639
|
|
|
$
|
613
|
|
(1)
|
These amounts are not adjusted for policy loans.
|
|
June 30, 2014
|
||||||
Guaranteed Minimum Crediting Rate
(1)
|
Account
Value (2)
|
|
Account
Value at
Guarantee (2)
|
||||
|
(In millions)
|
||||||
Annuities
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
26,473
|
|
|
$
|
2,204
|
|
Equal to 2% but less than 4%
|
$
|
1,104
|
|
|
$
|
362
|
|
Equal to or greater than 4%
|
$
|
2
|
|
|
$
|
2
|
|
Life & Other
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
6,261
|
|
|
$
|
5,831
|
|
Equal to 2% but less than 4%
|
$
|
17,581
|
|
|
$
|
8,779
|
|
Equal to or greater than 4%
|
$
|
263
|
|
|
$
|
—
|
|
(1)
|
Excludes negative VOBA liabilities of $1.9 billion at
June 30, 2014
, primarily held in Japan. These liabilities were established in instances where the estimated fair value of contract obligations exceeded the book value of assumed insurance policy liabilities in the acquisition of ALICO. These negative liabilities were established primarily for decreased market interest rates subsequent to the issuance of the policy contracts.
|
(2)
|
These amounts are not adjusted for policy loans.
|
|
Future Policy
Benefits
|
|
Policyholder
Account Balances
|
||||||||||||
|
June 30, 2014
|
|
December 31, 2013
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||
|
(In millions)
|
||||||||||||||
Americas
|
|
|
|
|
|
|
|
||||||||
GMDB
|
$
|
581
|
|
|
$
|
495
|
|
|
$
|
—
|
|
|
$
|
—
|
|
GMIB
|
1,812
|
|
|
1,608
|
|
|
(1,871
|
)
|
|
(1,904
|
)
|
||||
GMAB
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
GMWB
|
77
|
|
|
62
|
|
|
(411
|
)
|
|
(441
|
)
|
||||
Asia
|
|
|
|
|
|
|
|
||||||||
GMDB
|
37
|
|
|
33
|
|
|
—
|
|
|
—
|
|
||||
GMAB
|
—
|
|
|
—
|
|
|
8
|
|
|
3
|
|
||||
GMWB
|
216
|
|
|
204
|
|
|
134
|
|
|
129
|
|
||||
EMEA
|
|
|
|
|
|
|
|
||||||||
GMDB
|
(5
|
)
|
|
6
|
|
|
—
|
|
|
—
|
|
||||
GMAB
|
—
|
|
|
—
|
|
|
8
|
|
|
11
|
|
||||
GMWB
|
31
|
|
|
19
|
|
|
(142
|
)
|
|
(102
|
)
|
||||
Corporate & Other
|
|
|
|
|
|
|
|
||||||||
GMDB
|
9
|
|
|
11
|
|
|
—
|
|
|
—
|
|
||||
GMAB
|
—
|
|
|
—
|
|
|
71
|
|
|
83
|
|
||||
GMWB
|
90
|
|
|
109
|
|
|
1,390
|
|
|
1,179
|
|
||||
Total
|
$
|
2,848
|
|
|
$
|
2,547
|
|
|
$
|
(813
|
)
|
|
$
|
(1,040
|
)
|
|
Total Contract
Account Value (1)
|
||||||
|
Americas
|
|
Corporate &
Other
|
||||
|
(In millions)
|
||||||
Return of premium or five to seven year step-up
|
$
|
108,114
|
|
|
$
|
15,427
|
|
Annual step-up
|
32,388
|
|
|
—
|
|
||
Roll-up and step-up combination
|
40,788
|
|
|
—
|
|
||
Total
|
$
|
181,290
|
|
|
$
|
15,427
|
|
(1)
|
Total contract account value excludes $2.3 billion for contracts with no GMDBs and $12.5 billion of total contract account value in the EMEA and Asia segments.
|
|
Total Contract
Account Value (1)
|
||||||
|
Americas
|
|
Corporate &
Other
|
||||
|
(In millions)
|
||||||
GMIB
|
$
|
101,464
|
|
|
$
|
—
|
|
GMWB - non-life contingent
|
7,084
|
|
|
3,847
|
|
||
GMWB - life-contingent
|
21,161
|
|
|
9,736
|
|
||
GMAB
|
302
|
|
|
1,844
|
|
||
|
$
|
130,011
|
|
|
$
|
15,427
|
|
(1)
|
Total contract account value excludes $53.6 billion for contracts with no living benefit guarantees and $9.7 billion of total contract account value in the EMEA and Asia segments.
|
|
Total Contract
Account Value
|
||
|
(In millions)
|
||
7-year setback, 2.5% interest rate
|
$
|
37,609
|
|
7-year setback, 1.5% interest rate
|
6,231
|
|
|
10-year setback, 1.5% interest rate
|
20,534
|
|
|
10-year mortality projection, 10-year setback, 1.0% interest rate
|
32,391
|
|
|
10-year mortality projection, 10-year setback, 0.5% interest rate
|
4,699
|
|
|
|
$
|
101,464
|
|
|
In-the-
Moneyness
|
|
Total Contract
Account Value
|
|
% of Total
|
|
||
|
|
|
(In millions)
|
|
|
|||
In-the-money
|
30% +
|
|
$
|
891
|
|
|
0.9
|
%
|
|
20% to 30%
|
|
701
|
|
|
0.7
|
%
|
|
|
10% to 20%
|
|
1,520
|
|
|
1.5
|
%
|
|
|
0% to 10%
|
|
3,596
|
|
|
3.5
|
%
|
|
|
|
|
6,708
|
|
|
|
||
Out-of-the-money
|
-10% to 0%
|
|
7,364
|
|
|
7.3
|
%
|
|
|
-20% to -10%
|
|
12,999
|
|
|
12.8
|
%
|
|
|
-20% +
|
|
74,393
|
|
|
73.3
|
%
|
|
|
|
|
94,756
|
|
|
|
||
Total GMIBs
|
|
|
$
|
101,464
|
|
|
|
|
|
Instrument Type
|
|
June 30, 2014
|
|
December 31, 2013
|
||||||||||||||||||||
Primary Underlying
Risk Exposure
|
|
Notional
Amount
|
|
Estimated Fair Value
|
|
Notional
Amount
|
|
Estimated Fair Value
|
||||||||||||||||||
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||||||||||||||
|
|
|
|
(In millions)
|
||||||||||||||||||||||
Interest rate
|
|
Interest rate swaps
|
|
$
|
25,474
|
|
|
$
|
1,504
|
|
|
$
|
675
|
|
|
$
|
25,474
|
|
|
$
|
1,108
|
|
|
$
|
669
|
|
|
|
Interest rate futures
|
|
6,346
|
|
|
3
|
|
|
6
|
|
|
5,888
|
|
|
9
|
|
|
9
|
|
||||||
|
|
Interest rate options
|
|
27,940
|
|
|
315
|
|
|
149
|
|
|
17,690
|
|
|
131
|
|
|
236
|
|
||||||
Foreign currency exchange rate
|
|
Foreign currency forwards
|
|
2,349
|
|
|
15
|
|
|
6
|
|
|
2,324
|
|
|
1
|
|
|
171
|
|
||||||
|
|
Foreign currency futures
|
|
382
|
|
|
1
|
|
|
—
|
|
|
365
|
|
|
1
|
|
|
1
|
|
||||||
Equity market
|
|
Equity futures
|
|
5,803
|
|
|
1
|
|
|
11
|
|
|
5,144
|
|
|
1
|
|
|
43
|
|
||||||
|
|
Equity options
|
|
36,224
|
|
|
1,271
|
|
|
1,228
|
|
|
35,445
|
|
|
1,344
|
|
|
1,068
|
|
||||||
|
|
Variance swaps
|
|
21,985
|
|
|
217
|
|
|
691
|
|
|
21,636
|
|
|
174
|
|
|
577
|
|
||||||
|
|
Total rate of return swaps
|
|
3,449
|
|
|
—
|
|
|
138
|
|
|
3,802
|
|
|
—
|
|
|
179
|
|
||||||
|
|
Total
|
|
$
|
129,952
|
|
|
$
|
3,327
|
|
|
$
|
2,904
|
|
|
$
|
117,768
|
|
|
$
|
2,769
|
|
|
$
|
2,953
|
|
|
Six Months
Ended June 30, |
||||||
|
2014
|
|
2013
|
||||
|
(In millions)
|
||||||
Sources:
|
|
|
|
||||
Operating activities, net
|
$
|
6,921
|
|
|
$
|
7,314
|
|
Changes in payables for collateral under securities loaned and other transactions, net
|
2,891
|
|
|
—
|
|
||
Changes in bank deposits, net
|
—
|
|
|
8
|
|
||
Long-term debt issued
|
1,000
|
|
|
—
|
|
||
Effect of change in foreign currency exchange rates on cash and cash equivalents
|
21
|
|
|
—
|
|
||
Total sources
|
10,833
|
|
|
7,322
|
|
||
Uses:
|
|
|
|
||||
Investing activities, net
|
6,700
|
|
|
7,853
|
|
||
Changes in policyholder account balances, net
|
774
|
|
|
4,345
|
|
||
Changes in payables for collateral under securities loaned and other transactions, net
|
—
|
|
|
440
|
|
||
Short-term debt repayments, net
|
75
|
|
|
—
|
|
||
Long-term debt repaid
|
2,484
|
|
|
356
|
|
||
Treasury stock acquired in connection with share repurchases
|
4
|
|
|
—
|
|
||
Dividends on preferred stock
|
61
|
|
|
61
|
|
||
Dividends on common stock
|
706
|
|
|
505
|
|
||
Other, net
|
221
|
|
|
91
|
|
||
Effect of change in foreign currency exchange rates on cash and cash equivalents
|
—
|
|
|
225
|
|
||
Total uses
|
11,025
|
|
|
13,876
|
|
||
Net increase (decrease) in cash and cash equivalents
|
$
|
(192
|
)
|
|
$
|
(6,554
|
)
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
|
(In millions)
|
||||||
Short-term debt
|
$
|
100
|
|
|
$
|
175
|
|
Long-term debt (1)
|
$
|
16,278
|
|
|
$
|
17,198
|
|
Collateral financing arrangements
|
$
|
4,196
|
|
|
$
|
4,196
|
|
Junior subordinated debt securities
|
$
|
3,193
|
|
|
$
|
3,193
|
|
(1)
|
Excludes $505 million and $1.5 billion at
June 30, 2014
and
December 31, 2013
, respectively, of long-term debt relating to CSEs — FVO (see Note
6
of the Notes to the Interim Condensed Consolidated Financial Statements).
|
|
|
Record Date
|
|
Payment Date
|
|
Preferred Stock Dividend
|
||||||||||||||
Declaration Date
|
|
Series A
Per Share
|
|
Series A
Aggregate
|
|
Series B
Per Share
|
|
Series B
Aggregate
|
||||||||||||
|
|
|
|
|
|
(In millions, except per share data)
|
||||||||||||||
May 15, 2014
|
|
May 31, 2014
|
|
June 16, 2014
|
|
$
|
0.256
|
|
|
$
|
7
|
|
|
$
|
0.406
|
|
|
$
|
24
|
|
March 5, 2014
|
|
February 28, 2014
|
|
March 17, 2014
|
|
$
|
0.250
|
|
|
6
|
|
|
$
|
0.406
|
|
|
24
|
|
||
|
|
|
|
|
|
|
|
$
|
13
|
|
|
|
|
$
|
48
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
May 15, 2013
|
|
May 31, 2013
|
|
June 17, 2013
|
|
$
|
0.256
|
|
|
$
|
7
|
|
|
$
|
0.406
|
|
|
$
|
24
|
|
March 5, 2013
|
|
February 28, 2013
|
|
March 15, 2013
|
|
$
|
0.250
|
|
|
6
|
|
|
$
|
0.406
|
|
|
24
|
|
||
|
|
|
|
|
|
|
|
$
|
13
|
|
|
|
|
$
|
48
|
|
|
|
Record Date
|
|
Payment Date
|
|
Common Stock Dividend
|
||||||
Declaration Date
|
|
Per Share
|
|
Aggregate
|
||||||||
|
|
|
|
|
|
(In millions, except per share data)
|
||||||
April 22, 2014
|
|
May 9, 2014
|
|
June 13, 2014
|
|
$
|
0.350
|
|
|
$
|
395
|
|
January 6, 2014
|
|
February 6, 2014
|
|
March 13, 2014
|
|
$
|
0.275
|
|
|
311
|
|
|
|
|
|
|
|
|
|
|
$
|
706
|
|
||
|
|
|
|
|
|
|
|
|
||||
April 23, 2013
|
|
May 9, 2013
|
|
June 13, 2013
|
|
$
|
0.275
|
|
|
$
|
302
|
|
January 4, 2013
|
|
February 6, 2013
|
|
March 13, 2013
|
|
$
|
0.185
|
|
|
203
|
|
|
|
|
|
|
|
|
|
|
$
|
505
|
|
|
|
2014
|
||||||
Company
|
|
Paid
|
|
Permitted w/o
Approval (1)
|
||||
|
|
(In millions)
|
||||||
Metropolitan Life Insurance Company
|
|
$
|
558
|
|
|
$
|
1,163
|
|
American Life Insurance Company
|
|
$
|
—
|
|
|
$
|
—
|
|
MetLife Insurance Company of Connecticut (2)
|
|
$
|
—
|
|
|
$
|
1,013
|
|
Metropolitan Property and Casualty Insurance Company
|
|
$
|
—
|
|
|
$
|
218
|
|
Metropolitan Tower Life Insurance Company
|
|
$
|
—
|
|
|
$
|
73
|
|
MetLife Investors Insurance Company
|
|
$
|
—
|
|
|
$
|
120
|
|
Delaware American Life Insurance Company
|
|
$
|
—
|
|
|
$
|
16
|
|
(1)
|
Reflects dividend amounts that may be paid during 2014 without prior regulatory approval. However, because dividend tests may be based on dividends previously paid over rolling 12-month periods, if paid before a specified date during 2014, some or all of such dividends may require regulatory approval.
|
(2)
|
We do not expect MICC to pay any dividends during 2014. See “— Liquidity and Capital Uses — Affiliated Capital Transactions” for information regarding MICC’s expected redemption and retirement of its common stock held by MetLife Investors Group, LLC (“MLIG”) and MLIG’s expected dividend to MetLife, Inc. in connection with the Mergers.
|
|
June 30, 2014
|
|
December 31, 2013
|
||||
|
(In millions)
|
||||||
Long-term debt — unaffiliated
|
$
|
15,429
|
|
|
$
|
15,938
|
|
Long-term debt — affiliated (1)
|
$
|
3,600
|
|
|
$
|
3,600
|
|
Collateral financing arrangements
|
$
|
2,797
|
|
|
$
|
2,797
|
|
Junior subordinated debt securities
|
$
|
1,748
|
|
|
$
|
1,748
|
|
(1)
|
In June 2014, a $500 million senior note issued by MetLife, Inc. to MLIC matured and a new $500 million senior note was issued by MetLife, Inc. to MLIC. The senior note matures in June 2019 and bears interest at a fixed rate of 3.54%, payable semi-annually.
|
•
|
Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to net investment gains (losses) and net derivative gains (losses) and certain variable annuity GMIB fees (“GMIB Fees”);
|
•
|
Net investment income: (i) includes amounts for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment, (ii) includes income from discontinued real estate operations, (iii) excludes post-tax operating earnings adjustments relating to insurance joint ventures accounted for under the equity method, (iv) excludes certain amounts related to contractholder-directed unit-linked investments, and (v) excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and
|
•
|
Other revenues are adjusted for settlements of foreign currency earnings hedges.
|
•
|
Policyholder benefits and claims and policyholder dividends excludes: (i) changes in the policyholder dividend obligation related to net investment gains (losses) and net derivative gains (losses), (ii) inflation-indexed benefit adjustments associated with contracts backed by inflation-indexed investments and amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets and other pass through adjustments (“Inflation and Pass Through Adjustments”) (iii) benefits and hedging costs related to GMIBs (“GMIB Costs”), and (iv) market value adjustments associated with surrenders or terminations of contracts (“Market Value Adjustments”);
|
•
|
Interest credited to policyholder account balances includes adjustments for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of PABs but do not qualify for hedge accounting treatment and excludes amounts related to net investment income earned on contractholder-directed unit-linked investments;
|
•
|
Amortization of DAC and VOBA excludes amounts related to: (i) net investment gains (losses) and net derivative gains (losses), (ii) GMIB Fees and GMIB Costs, and (iii) Market Value Adjustments;
|
•
|
Amortization of negative VOBA excludes amounts related to Market Value Adjustments;
|
•
|
Interest expense on debt excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and
|
•
|
Other expenses excludes costs related to: (i) noncontrolling interests, (ii) implementation of new insurance regulatory requirements, and (iii) acquisition and integration costs.
|
•
|
implementing a corporate risk framework, which outlines our enterprise approach for managing risk;
|
•
|
developing policies and procedures for managing, measuring, monitoring and controlling those risks identified in the corporate risk framework;
|
•
|
establishing appropriate corporate risk tolerance levels;
|
•
|
deploying capital on an economic basis;
|
•
|
recommending capital allocations on an economic capital basis; and
|
•
|
reporting to (i) the Finance and Risk Committee of MetLife, Inc.’s Board of Directors; (ii) the Investment Committee of MLIC’s Board of Directors, which assists MetLife, Inc.’s Board of Directors in overseeing certain investment activities of the enterprise; and (iii) the financial and non-financial senior management committees on various aspects of risk.
|
•
|
GRM’s Foreign Exchange Committee, in coordination with the Treasury Department, is responsible for managing our exposure to investments in foreign subsidiaries. Exposure limits are established by the Treasury Department and monitored by GRM. The Investments Department manages such exposure.
|
•
|
The Investments Department is responsible for managing the exposure to foreign currency denominated investments. Exposure limits to unhedged foreign currency investments are incorporated into the standing authorizations granted to management by the Board of Directors and are reported to the Board of Directors on a periodic basis.
|
•
|
Management of each of the Company’s segments, with oversight from the Foreign Exchange Committee, is responsible for establishing limits and managing any foreign currency exchange rate exposure caused by the sale or issuance of insurance products.
|
•
|
Risks Related to Living Guarantee Benefits — We use a wide range of derivative contracts to mitigate the risk associated with variable annuity living guarantee benefits. These derivatives include equity and interest rate futures, interest rate swaps, currency futures/forwards, equity indexed options and interest rate option contracts and equity variance swaps.
|
•
|
Minimum Interest Rate Guarantees — For certain liability contracts, we provide the contractholder a guaranteed minimum interest rate. These contracts include certain fixed annuities and other insurance liabilities. We purchase interest rate floors to reduce risk associated with these liability guarantees.
|
•
|
Reinvestment Risk in Long Duration Liability Contracts — Derivatives are used to hedge interest rate risk related to certain long duration liability contracts. Hedges include interest rate swaps and swaptions.
|
•
|
Foreign Currency Exchange Rate Risk — We use currency swaps, forwards and options to hedge foreign currency exchange rate risk. These hedges primarily swap foreign currency denominated bonds, investments in foreign subsidiaries or equity market exposures to U.S. dollars.
|
•
|
General ALM Hedging Strategies — In the ordinary course of managing our asset/liability risks, we use interest rate futures, interest rate swaps, interest rate caps, interest rate floors and inflation swaps. These hedges are designed to reduce interest rate risk or inflation risk related to the existing assets or liabilities or related to expected future cash flows.
|
•
|
the net present values of our interest rate sensitive exposures resulting from a 10% change (increase or decrease) in interest rates;
|
•
|
the U.S. dollar equivalent estimated fair values of our foreign currency exposures due to a 10% change (increase or decrease) in foreign currency exchange rates; and
|
•
|
the estimated fair value of our equity positions due to a 10% change (increase or decrease) in equity market prices.
|
•
|
the market risk information is limited by the assumptions and parameters established in creating the related sensitivity analysis, including the impact of prepayment rates on mortgage loans;
|
•
|
for the derivatives that qualify as hedges, the impact on reported earnings may be materially different from the change in market values;
|
•
|
the analysis excludes liabilities pursuant to insurance contracts and real estate holdings; and
|
•
|
the model assumes that the composition of assets and liabilities remains unchanged throughout the period.
|
|
June 30, 2014
|
||
|
(In millions)
|
||
Non-trading:
|
|
||
Interest rate risk
|
$
|
6,078
|
|
Foreign currency exchange rate risk
|
$
|
6,907
|
|
Equity market risk
|
$
|
111
|
|
Trading:
|
|
||
Interest rate risk
|
$
|
5
|
|
Foreign currency exchange rate risk
|
$
|
—
|
|
|
June 30, 2014
|
||||||||||
|
Notional
Amount
|
|
Estimated
Fair
Value (1)
|
|
Assuming a
10% Increase
in the Yield
Curve
|
||||||
|
(In millions)
|
||||||||||
Assets
|
|
|
|
|
|
||||||
Fixed maturity securities
|
|
|
$
|
367,056
|
|
|
$
|
(6,157
|
)
|
||
Equity securities
|
|
|
$
|
3,863
|
|
|
—
|
|
|||
Fair value option and trading securities:
|
|
|
|
|
|
||||||
Actively Traded Securities
|
|
|
$
|
690
|
|
|
(10
|
)
|
|||
Fair value option general account securities
|
|
|
$
|
682
|
|
|
(1
|
)
|
|||
Total fair value option and trading securities
|
|
|
$
|
1,372
|
|
|
(11
|
)
|
|||
Mortgage loans
|
|
|
$
|
59,194
|
|
|
(391
|
)
|
|||
Policy loans
|
|
|
$
|
13,458
|
|
|
(115
|
)
|
|||
Short-term investments
|
|
|
$
|
12,366
|
|
|
(2
|
)
|
|||
Other invested assets
|
|
|
$
|
982
|
|
|
—
|
|
|||
Cash and cash equivalents
|
|
|
$
|
7,393
|
|
|
—
|
|
|||
Accrued investment income
|
|
|
$
|
4,234
|
|
|
—
|
|
|||
Premiums, reinsurance and other receivables
|
|
|
$
|
4,062
|
|
|
(154
|
)
|
|||
Other assets
|
|
|
$
|
1,050
|
|
|
(4
|
)
|
|||
Net embedded derivatives within asset host contracts (2)
|
|
|
$
|
328
|
|
|
(21
|
)
|
|||
Total assets
|
|
|
|
|
$
|
(6,855
|
)
|
||||
Liabilities (3)
|
|
|
|
|
|
||||||
Policyholder account balances
|
|
|
$
|
137,432
|
|
|
$
|
635
|
|
||
Payables for collateral under securities loaned and other transactions
|
|
|
$
|
33,187
|
|
|
—
|
|
|||
Short-term debt
|
|
|
$
|
100
|
|
|
—
|
|
|||
Long-term debt
|
|
|
$
|
18,293
|
|
|
350
|
|
|||
Collateral financing arrangements
|
|
|
$
|
3,993
|
|
|
—
|
|
|||
Junior subordinated debt securities
|
|
|
$
|
4,131
|
|
|
120
|
|
|||
Other liabilities:
|
|
|
|
|
|
||||||
Trading liabilities
|
|
|
$
|
218
|
|
|
5
|
|
|||
Other
|
|
|
$
|
5,903
|
|
|
124
|
|
|||
Net embedded derivatives within liability host contracts (2)
|
|
|
$
|
(684
|
)
|
|
480
|
|
|||
Total liabilities
|
|
|
|
|
$
|
1,714
|
|
||||
Derivative Instruments
|
|
|
|
|
|
||||||
Interest rate swaps
|
$
|
104,642
|
|
|
$
|
3,889
|
|
|
$
|
(689
|
)
|
Interest rate floors
|
$
|
67,265
|
|
|
$
|
172
|
|
|
(25
|
)
|
|
Interest rate caps
|
$
|
36,605
|
|
|
$
|
111
|
|
|
30
|
|
|
Interest rate futures
|
$
|
6,364
|
|
|
$
|
(3
|
)
|
|
3
|
|
|
Interest rate options
|
$
|
39,361
|
|
|
$
|
345
|
|
|
(173
|
)
|
|
Interest rate forwards
|
$
|
640
|
|
|
$
|
37
|
|
|
(16
|
)
|
|
Synthetic GICs
|
$
|
4,362
|
|
|
$
|
—
|
|
|
—
|
|
|
Foreign currency swaps
|
$
|
25,923
|
|
|
$
|
(547
|
)
|
|
(9
|
)
|
|
Foreign currency forwards
|
$
|
18,219
|
|
|
$
|
(6
|
)
|
|
(10
|
)
|
|
Currency futures
|
$
|
382
|
|
|
$
|
1
|
|
|
—
|
|
|
Currency options
|
$
|
14,808
|
|
|
$
|
119
|
|
|
(6
|
)
|
|
Credit default swaps
|
$
|
13,657
|
|
|
$
|
130
|
|
|
—
|
|
|
Equity futures
|
$
|
5,814
|
|
|
$
|
(10
|
)
|
|
—
|
|
|
Equity options
|
$
|
38,116
|
|
|
$
|
44
|
|
|
(50
|
)
|
|
Variance swaps
|
$
|
21,985
|
|
|
$
|
(474
|
)
|
|
3
|
|
|
Total rate of return swaps
|
$
|
3,449
|
|
|
$
|
(138
|
)
|
|
—
|
|
|
Total derivative instruments
|
|
|
|
|
$
|
(942
|
)
|
||||
Net Change
|
|
|
|
|
$
|
(6,083
|
)
|
(1)
|
Separate account assets and liabilities and contractholder-directed unit-linked investments and associated PABs, which are interest rate sensitive, are not included herein as any interest rate risk is borne by the contractholder. Mortgage loans, fair value option and trading securities and long-term debt exclude $
638 million
, $18 million and $
505 million
, respectively, related to CSEs. See
Note 6
of the Notes to the Interim Condensed Consolidated Financial Statements for information regarding CSEs.
|
(2)
|
Embedded derivatives are recognized in the consolidated balance sheet in the same caption as the host contract.
|
(3)
|
Excludes $205.0 billion of liabilities, at carrying value, pursuant to insurance contracts reported within future policy benefits and other policy-related balances. These liabilities would economically offset a significant portion of the net change in fair value of our financial instruments resulting from a 10% increase in the yield curve.
|
|
June 30, 2014
|
||||||||||
|
Notional
Amount
|
|
Estimated
Fair
Value (1)
|
|
Assuming a
10% Increase
in the Foreign
Exchange Rate
|
||||||
|
(In millions)
|
||||||||||
Assets
|
|
|
|
|
|
||||||
Fixed maturity securities
|
|
|
$
|
367,056
|
|
|
$
|
(8,624
|
)
|
||
Equity securities
|
|
|
$
|
3,863
|
|
|
(116
|
)
|
|||
Fair value option and trading securities:
|
|
|
|
|
|
||||||
Actively Traded Securities
|
|
|
$
|
690
|
|
|
—
|
|
|||
Fair value option general account securities
|
|
|
$
|
682
|
|
|
(76
|
)
|
|||
Total fair value option and trading securities
|
|
|
$
|
1,372
|
|
|
(76
|
)
|
|||
Mortgage loans
|
|
|
$
|
59,194
|
|
|
(649
|
)
|
|||
Policy loans
|
|
|
$
|
13,458
|
|
|
(169
|
)
|
|||
Short-term investments
|
|
|
$
|
12,366
|
|
|
(232
|
)
|
|||
Other invested assets
|
|
|
$
|
982
|
|
|
(156
|
)
|
|||
Cash and cash equivalents
|
|
|
$
|
7,393
|
|
|
(357
|
)
|
|||
Accrued investment income
|
|
|
$
|
4,234
|
|
|
(87
|
)
|
|||
Premiums, reinsurance and other receivables
|
|
|
$
|
4,062
|
|
|
(63
|
)
|
|||
Other assets
|
|
|
$
|
1,050
|
|
|
(6
|
)
|
|||
Net embedded derivatives within asset host contracts (2)
|
|
|
$
|
328
|
|
|
(13
|
)
|
|||
Total assets
|
|
|
|
|
$
|
(10,548
|
)
|
||||
Liabilities (3)
|
|
|
|
|
|
||||||
Policyholder account balances
|
|
|
$
|
137,432
|
|
|
$
|
2,836
|
|
||
Payables for collateral under securities loaned and other transactions
|
|
|
$
|
33,187
|
|
|
119
|
|
|||
Long-term debt
|
|
|
$
|
18,293
|
|
|
144
|
|
|||
Other liabilities
|
|
|
$
|
6,121
|
|
|
17
|
|
|||
Net embedded derivatives within liability host contracts (2)
|
|
|
$
|
(684
|
)
|
|
147
|
|
|||
Total liabilities
|
|
|
|
|
$
|
3,263
|
|
||||
Derivative Instruments
|
|
|
|
|
|
||||||
Interest rate swaps
|
$
|
104,642
|
|
|
$
|
3,889
|
|
|
$
|
(25
|
)
|
Interest rate floors
|
$
|
67,265
|
|
|
$
|
172
|
|
|
—
|
|
|
Interest rate caps
|
$
|
36,605
|
|
|
$
|
111
|
|
|
—
|
|
|
Interest rate futures
|
$
|
6,364
|
|
|
$
|
(3
|
)
|
|
1
|
|
|
Interest rate options
|
$
|
39,361
|
|
|
$
|
345
|
|
|
(15
|
)
|
|
Interest rate forwards
|
$
|
640
|
|
|
$
|
37
|
|
|
—
|
|
|
Synthetic GICs
|
$
|
4,362
|
|
|
$
|
—
|
|
|
—
|
|
|
Foreign currency swaps
|
$
|
25,923
|
|
|
$
|
(547
|
)
|
|
602
|
|
|
Foreign currency forwards
|
$
|
18,219
|
|
|
$
|
(6
|
)
|
|
(364
|
)
|
|
Currency futures
|
$
|
382
|
|
|
$
|
1
|
|
|
(112
|
)
|
|
Currency options
|
$
|
14,808
|
|
|
$
|
119
|
|
|
303
|
|
|
Credit default swaps
|
$
|
13,657
|
|
|
$
|
130
|
|
|
(1
|
)
|
|
Equity futures
|
$
|
5,814
|
|
|
$
|
(10
|
)
|
|
1
|
|
|
Equity options
|
$
|
38,116
|
|
|
$
|
44
|
|
|
(14
|
)
|
|
Variance swaps
|
$
|
21,985
|
|
|
$
|
(474
|
)
|
|
2
|
|
|
Total rate of return swaps
|
$
|
3,449
|
|
|
$
|
(138
|
)
|
|
—
|
|
|
Total derivative instruments
|
|
|
|
|
$
|
378
|
|
||||
Net Change
|
|
|
|
|
$
|
(6,907
|
)
|
(1)
|
Does not necessarily represent those financial instruments solely subject to foreign currency exchange rate risk. Separate account assets and liabilities and contractholder-directed unit-linked investments and associated PABs, which are foreign currency exchange rate sensitive, are not included herein as any foreign currency exchange rate risk is borne by the contractholder. Mortgage loans, fair value option and trading securities and long-term debt exclude $
638 million
, $18 million and $
505 million
, respectively, related to CSEs. See
Note 6
of the Notes to the Interim Condensed Consolidated Financial Statements for information regarding CSEs.
|
(2)
|
Embedded derivatives are recognized in the consolidated balance sheet in the same caption as the host contract.
|
(3)
|
Excludes $205.0 billion of liabilities, at carrying value, pursuant to insurance contracts reported within future policy benefits and other policy-related balances. These liabilities would economically offset a significant portion of the net change in fair value of our financial instruments resulting from a 10% increase in foreign currency exchange rates.
|
|
June 30, 2014
|
||||||||||
|
Notional
Amount
|
|
Estimated
Fair
Value (1)
|
|
Assuming a
10% Increase
in Equity
Prices
|
||||||
|
(In millions)
|
||||||||||
Assets
|
|
|
|
|
|
||||||
Equity securities
|
|
|
$
|
3,863
|
|
|
$
|
387
|
|
||
Net embedded derivatives within asset host contracts (2)
|
|
|
$
|
328
|
|
|
(18
|
)
|
|||
Total assets
|
|
|
|
|
$
|
369
|
|
||||
Liabilities
|
|
|
|
|
|
||||||
Policyholder account balances
|
|
|
$
|
137,432
|
|
|
$
|
—
|
|
||
Net embedded derivatives within liability host contracts (2)
|
|
|
$
|
(684
|
)
|
|
643
|
|
|||
Total liabilities
|
|
|
|
|
$
|
643
|
|
||||
Derivative Instruments
|
|
|
|
|
|
||||||
Interest rate swaps
|
$
|
104,642
|
|
|
$
|
3,889
|
|
|
$
|
—
|
|
Interest rate floors
|
$
|
67,265
|
|
|
$
|
172
|
|
|
—
|
|
|
Interest rate caps
|
$
|
36,605
|
|
|
$
|
111
|
|
|
—
|
|
|
Interest rate futures
|
$
|
6,364
|
|
|
$
|
(3
|
)
|
|
—
|
|
|
Interest rate options
|
$
|
39,361
|
|
|
$
|
345
|
|
|
—
|
|
|
Interest rate forwards
|
$
|
640
|
|
|
$
|
37
|
|
|
—
|
|
|
Synthetic GICs
|
$
|
4,362
|
|
|
$
|
—
|
|
|
—
|
|
|
Foreign currency swaps
|
$
|
25,923
|
|
|
$
|
(547
|
)
|
|
—
|
|
|
Foreign currency forwards
|
$
|
18,219
|
|
|
$
|
(6
|
)
|
|
—
|
|
|
Currency futures
|
$
|
382
|
|
|
$
|
1
|
|
|
—
|
|
|
Currency options
|
$
|
14,808
|
|
|
$
|
119
|
|
|
—
|
|
|
Credit default swaps
|
$
|
13,657
|
|
|
$
|
130
|
|
|
—
|
|
|
Equity futures
|
$
|
5,814
|
|
|
$
|
(10
|
)
|
|
(524
|
)
|
|
Equity options
|
$
|
38,116
|
|
|
$
|
44
|
|
|
(255
|
)
|
|
Variance swaps
|
$
|
21,985
|
|
|
$
|
(474
|
)
|
|
11
|
|
|
Total rate of return swaps
|
$
|
3,449
|
|
|
$
|
(138
|
)
|
|
(355
|
)
|
|
Total derivative instruments
|
|
|
|
|
$
|
(1,123
|
)
|
||||
Net Change
|
|
|
|
|
$
|
(111
|
)
|
(1)
|
Does not necessarily represent those financial instruments solely subject to equity price risk. Additionally, separate account assets and liabilities and contractholder-directed unit-linked investments and associated PABs, which are equity market sensitive, are not included herein as any equity market risk is borne by the contractholder.
|
(2)
|
Embedded derivatives are recognized in the consolidated balance sheet in the same caption as the host contract.
|
Period
|
|
(a) Total Number
of Shares
Purchased (1)
|
|
(b) Average Price
Paid per Share
|
|
(c) Total Number
of Shares
Purchased as Part
of Publicly
Announced Plans
or Programs
|
|
(d) Maximum Number
(or Approximate
Dollar Value) of
Shares that May Yet
Be Purchased Under the
Plans or Programs (2)
|
||||||
April 1 — April 30, 2014
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
1,260,735,127
|
|
May 1 — May 31, 2014
|
|
815
|
|
|
$
|
52.35
|
|
|
—
|
|
|
$
|
1,260,735,127
|
|
June 1 — June 30, 2014
|
|
84,618
|
|
|
$
|
55.82
|
|
|
80,662
|
|
|
$
|
1,256,235,172
|
|
(1)
|
During the periods May 1 through May 31, 2014 and June 1 through
June 30, 2014
, separate account and other affiliates of MetLife, Inc. purchased
815
shares and
3,956
shares, respectively, of common stock on the open market in nondiscretionary transactions to rebalance index funds. Except for the foregoing, there were no shares of common stock which were repurchased by MetLife, Inc. other than through a publicly announced plan or program.
|
(2)
|
At
June 30, 2014
, MetLife, Inc. had
$1.3 billion
remaining under its common stock repurchase program authorizations. In April 2008, MetLife, Inc.’s Board of Directors authorized an additional $1.0 billion common stock repurchase program, which will begin after the completion of the January 2008 $1.0 billion common stock repurchase program, of which
$256 million
remained outstanding at
June 30, 2014
. Under these authorizations, MetLife, Inc. may purchase its common stock from the MetLife Policyholder Trust, in the open market (including pursuant to the terms of a pre-set trading plan meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934) and in privately negotiated transactions. Future common stock repurchases will be dependent upon several factors, including our capital position, liquidity, financial strength and credit ratings, general market conditions, the market price of MetLife, Inc.’s common stock compared to management’s assessment of the stock’s underlying value and applicable regulatory approvals, as well as other legal and accounting factors. See “Risk Factors — Capital-Related Risks — Regulatory Restrictions and Uncertainty and Restrictions Under the Terms of Certain of Our Securities May Prevent Us from Repurchasing Our Stock and Paying Dividends at the Level We Wish” included in MetLife, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014 and Note 16 of the Notes to the Consolidated Financial Statements included in the 2013 Annual Report.
|
METLIFE, INC.
|
||
|
|
|
By:
|
|
/s/ Peter M. Carlson
|
|
|
Name: Peter M. Carlson
Title: Executive Vice President
and Chief Accounting Officer
(Authorized Signatory and Principal
Accounting Officer)
|
(a)
|
the MetLife Options Short Term Disability Summary Plan Description and is receiving Short Term Disability benefits under MetLife Options (or the successor plan(s) to such plan(s)); or
|
(b)
|
the MetLife Options Long Term Disability Summary Plan Description and is receiving Long Term Disability benefits under MetLife Options (or the successor plan(s) to such plan(s)).
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Steven A. Kandarian
|
Steven A. Kandarian
Chairman, President and
Chief Executive Officer
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ John C.R. Hele
|
John C. R. Hele
Executive Vice President and
Chief Financial Officer
|
/s/ Steven A. Kandarian
|
Steven A. Kandarian
Chairman, President and
Chief Executive Officer
|
/s/ John C.R. Hele
|
John C. R. Hele
Executive Vice President and
Chief Financial Officer
|