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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
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þ
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Page
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Item 1.
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Financial Statements (at September 30, 2015 (Unaudited) and December 31, 2014 and for the Three Months and Nine Months Ended September 30, 2015 and 2014 (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 5.
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Item 6.
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September 30, 2015
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December 31, 2014
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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: $329,203 and $334,780, respectively; includes $4,293 and $4,266, respectively, relating to variable interest entities)
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$
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351,578
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$
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365,425
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Equity securities available-for-sale, at estimated fair value (cost: $3,096 and $3,076, respectively)
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3,399
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3,631
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Fair value option and trading securities, at estimated fair value (includes $696 and $704, respectively, of actively traded securities; and $14 and $60, respectively, relating to variable interest entities)
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15,361
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16,689
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Mortgage loans (net of valuation allowances of $311 and $305, respectively; includes $290 and $280, respectively, at estimated fair value, relating to variable interest entities; includes $315 and $308, respectively, under the fair value option)
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63,553
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60,118
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Policy loans (includes $4 and $3, respectively, relating to variable interest entities)
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11,549
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11,618
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Real estate and real estate joint ventures (includes $0 and $8, respectively, relating to variable interest entities; includes $905 and $172, respectively, of real estate held-for-sale)
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9,923
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10,525
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Other limited partnership interests (includes $27 and $34, respectively, relating to variable interest entities)
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7,901
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8,085
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Short-term investments, principally at estimated fair value (includes $26 and $20, respectively, relating to variable interest entities)
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14,957
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8,621
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Other invested assets, principally at estimated fair value (includes $43 and $56, respectively, relating to variable interest entities)
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23,356
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21,283
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Total investments
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501,577
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505,995
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Cash and cash equivalents, principally at estimated fair value (includes $48 and $57, respectively, relating to variable interest entities)
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10,216
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10,808
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Accrued investment income (includes $26 and $21, respectively, relating to variable interest entities)
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4,187
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4,120
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Premiums, reinsurance and other receivables (includes $21 and $21, respectively, relating to variable interest entities)
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25,808
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22,244
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Deferred policy acquisition costs and value of business acquired (includes $230 and $235, respectively, relating to variable interest entities)
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23,996
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24,442
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Goodwill
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9,546
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9,872
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Other assets (includes $146 and $134, respectively, relating to variable interest entities)
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7,881
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7,862
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Separate account assets (includes $1,056 and $1,128, respectively, relating to variable interest entities)
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299,249
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316,994
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Total assets
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$
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882,460
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$
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902,337
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Liabilities and Equity
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Liabilities
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Future policy benefits (includes $670 and $579, respectively, relating to variable interest entities)
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$
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190,754
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$
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189,586
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Policyholder account balances (includes $21 and $33, respectively, relating to variable interest entities)
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202,291
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209,294
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Other policy-related balances (includes $225 and $198, respectively, relating to variable interest entities)
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14,521
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14,422
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Policyholder dividends payable
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716
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684
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Policyholder dividend obligation
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2,309
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3,155
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Payables for collateral under securities loaned and other transactions
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37,991
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35,326
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Short-term debt
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100
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100
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Long-term debt (includes $162 and $151, respectively, at estimated fair value, relating to variable interest entities)
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16,755
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16,286
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Collateral financing arrangements
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4,152
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4,196
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Junior subordinated debt securities
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3,194
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3,193
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Current income tax payable
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21
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184
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Deferred income tax liability
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11,363
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11,821
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Other liabilities (includes $71 and $80, respectively, relating to variable interest entities)
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27,977
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24,437
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Separate account liabilities (includes $1,056 and $1,128, respectively, relating to variable interest entities)
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299,249
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316,994
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Total liabilities
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811,393
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829,678
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Contingencies, Commitments and Guarantees (Note 14)
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Redeemable noncontrolling interests in partially-owned consolidated subsidiaries
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79
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99
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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; $2,100 aggregate liquidation preference
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—
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1
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Common stock, par value $0.01 per share; 3,000,000,000 shares authorized; 1,159,310,431 and 1,153,998,144 shares issued, respectively; 1,114,764,365 and 1,131,927,894 shares outstanding, respectively
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12
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12
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Additional paid-in capital
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30,726
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30,543
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Retained earnings
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35,153
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32,020
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Treasury stock, at cost; 44,546,066 and 22,070,250 shares, respectively
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(2,279
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)
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(1,172
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)
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Accumulated other comprehensive income (loss)
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6,891
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10,649
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Total MetLife, Inc.’s stockholders’ equity
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70,503
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72,053
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Noncontrolling interests
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485
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507
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Total equity
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70,988
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72,560
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Total liabilities and equity
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$
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882,460
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$
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902,337
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Three Months
Ended September 30, |
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Nine Months
Ended September 30, |
||||||||||||
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2015
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2014
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2015
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2014
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Revenues
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Premiums
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$
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10,375
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$
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9,703
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$
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28,940
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$
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28,795
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Universal life and investment-type product policy fees
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2,346
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2,628
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7,174
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7,507
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|
||||
Net investment income
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3,959
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5,410
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14,367
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15,704
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|
||||
Other revenues
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484
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|
518
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1,497
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1,486
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|
||||
Net investment gains (losses):
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||||||||
Other-than-temporary impairments on fixed maturity securities
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(43
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)
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(17
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)
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(51
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)
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(40
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)
|
||||
Other-than-temporary impairments on fixed maturity securities transferred to other comprehensive income (loss)
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16
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(14
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)
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4
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(16
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)
|
||||
Other net investment gains (losses)
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409
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|
140
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582
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(371
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)
|
||||
Total net investment gains (losses)
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382
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|
|
109
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|
|
535
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(427
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)
|
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Net derivative gains (losses)
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485
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|
478
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|
|
394
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|
|
1,132
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|
||||
Total revenues
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18,031
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|
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18,846
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|
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52,907
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54,197
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|
||||
Expenses
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|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims
|
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10,334
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9,512
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28,943
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|
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28,824
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|
||||
Interest credited to policyholder account balances
|
|
647
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|
|
1,817
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|
|
3,940
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|
|
4,995
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|
||||
Policyholder dividends
|
|
354
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|
|
347
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|
|
1,024
|
|
|
1,047
|
|
||||
Other expenses
|
|
4,533
|
|
|
4,218
|
|
|
12,665
|
|
|
12,603
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|
||||
Total expenses
|
|
15,868
|
|
|
15,894
|
|
|
46,572
|
|
|
47,469
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|
||||
Income (loss) from continuing operations before provision for income tax
|
|
2,163
|
|
|
2,952
|
|
|
6,335
|
|
|
6,728
|
|
||||
Provision for income tax expense (benefit)
|
|
965
|
|
|
858
|
|
|
1,855
|
|
|
1,916
|
|
||||
Income (loss) from continuing operations, net of income tax
|
|
1,198
|
|
|
2,094
|
|
|
4,480
|
|
|
4,812
|
|
||||
Income (loss) from discontinued operations, net of income tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||
Net income (loss)
|
|
1,198
|
|
|
2,094
|
|
|
4,480
|
|
|
4,809
|
|
||||
Less: Net income (loss) attributable to noncontrolling interests
|
|
(5
|
)
|
|
—
|
|
|
4
|
|
|
21
|
|
||||
Net income (loss) attributable to MetLife, Inc.
|
|
1,203
|
|
|
2,094
|
|
|
4,476
|
|
|
4,788
|
|
||||
Less: Preferred stock dividends
|
|
6
|
|
|
30
|
|
|
67
|
|
|
91
|
|
||||
Preferred stock repurchase premium
|
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
||||
Net income (loss) available to MetLife, Inc.’s common shareholders
|
|
$
|
1,197
|
|
|
$
|
2,064
|
|
|
$
|
4,367
|
|
|
$
|
4,697
|
|
Comprehensive income (loss)
|
|
$
|
1,653
|
|
|
$
|
1,972
|
|
|
$
|
760
|
|
|
$
|
10,682
|
|
Less: Comprehensive income (loss) attributable to noncontrolling interests, net of income tax
|
|
2
|
|
|
(56
|
)
|
|
42
|
|
|
6
|
|
||||
Comprehensive income (loss) attributable to MetLife, Inc.
|
|
$
|
1,651
|
|
|
$
|
2,028
|
|
|
$
|
718
|
|
|
$
|
10,676
|
|
Income (loss) from continuing operations, net of income tax, available to MetLife, Inc.’s common shareholders per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
1.07
|
|
|
$
|
1.83
|
|
|
$
|
3.90
|
|
|
$
|
4.17
|
|
Diluted
|
|
$
|
1.06
|
|
|
$
|
1.81
|
|
|
$
|
3.86
|
|
|
$
|
4.12
|
|
Net income (loss) available to MetLife, Inc.’s common shareholders per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
1.07
|
|
|
$
|
1.83
|
|
|
$
|
3.90
|
|
|
$
|
4.17
|
|
Diluted
|
|
$
|
1.06
|
|
|
$
|
1.81
|
|
|
$
|
3.86
|
|
|
$
|
4.12
|
|
Cash dividends declared per common share
|
|
$
|
0.375
|
|
|
$
|
0.350
|
|
|
$
|
1.100
|
|
|
$
|
0.975
|
|
|
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Treasury
Stock
at Cost
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
MetLife, Inc.’s
Stockholders’
Equity
|
|
Noncontrolling
Interests (1)
|
|
Total
Equity
|
||||||||||||||||||
Balance at December 31, 2014
|
|
$
|
1
|
|
|
$
|
12
|
|
|
$
|
30,543
|
|
|
$
|
32,020
|
|
|
$
|
(1,172
|
)
|
|
$
|
10,649
|
|
|
$
|
72,053
|
|
|
$
|
507
|
|
|
$
|
72,560
|
|
Repurchase of preferred stock
|
|
(1
|
)
|
|
|
|
(1,459
|
)
|
|
|
|
|
|
|
|
(1,460
|
)
|
|
|
|
(1,460
|
)
|
||||||||||||||
Preferred stock repurchase premium
|
|
|
|
|
|
|
|
(42
|
)
|
|
|
|
|
|
(42
|
)
|
|
|
|
(42
|
)
|
|||||||||||||||
Preferred stock issuance
|
|
—
|
|
|
|
|
1,483
|
|
|
|
|
|
|
|
|
1,483
|
|
|
|
|
1,483
|
|
||||||||||||||
Treasury stock acquired in connection with share repurchases
|
|
|
|
|
|
|
|
|
|
|
(1,107
|
)
|
|
|
|
(1,107
|
)
|
|
|
|
(1,107
|
)
|
||||||||||||||
Stock-based compensation
|
|
|
|
|
|
159
|
|
|
|
|
|
|
|
|
159
|
|
|
|
|
159
|
|
|||||||||||||||
Dividends on preferred stock
|
|
|
|
|
|
|
|
(67
|
)
|
|
|
|
|
|
(67
|
)
|
|
|
|
(67
|
)
|
|||||||||||||||
Dividends on common stock
|
|
|
|
|
|
|
|
(1,234
|
)
|
|
|
|
|
|
(1,234
|
)
|
|
|
|
(1,234
|
)
|
|||||||||||||||
Change in equity of noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
(64
|
)
|
|
(64
|
)
|
|||||||||||||||
Net income (loss)
|
|
|
|
|
|
|
|
4,476
|
|
|
|
|
|
|
4,476
|
|
|
4
|
|
|
4,480
|
|
||||||||||||||
Other comprehensive income (loss), net of income tax
|
|
|
|
|
|
|
|
|
|
|
|
(3,758
|
)
|
|
(3,758
|
)
|
|
38
|
|
|
(3,720
|
)
|
||||||||||||||
Balance at September 30, 2015
|
|
$
|
—
|
|
|
$
|
12
|
|
|
$
|
30,726
|
|
|
$
|
35,153
|
|
|
$
|
(2,279
|
)
|
|
$
|
6,891
|
|
|
$
|
70,503
|
|
|
$
|
485
|
|
|
$
|
70,988
|
|
|
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional Paid-in Capital
|
|
Retained
Earnings
|
|
Treasury
Stock
at Cost
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
MetLife, Inc.’s
Stockholders’
Equity
|
|
Noncontrolling
Interests (1)
|
|
Total
Equity
|
||||||||||||||||||
Balance at December 31, 2013
|
|
$
|
1
|
|
|
$
|
11
|
|
|
$
|
29,277
|
|
|
$
|
27,332
|
|
|
$
|
(172
|
)
|
|
$
|
5,104
|
|
|
$
|
61,553
|
|
|
$
|
543
|
|
|
$
|
62,096
|
|
Treasury stock acquired in connection with share repurchases
|
|
|
|
|
|
|
|
|
|
(443
|
)
|
|
|
|
(443
|
)
|
|
|
|
(443
|
)
|
|||||||||||||||
Stock-based compensation
|
|
|
|
|
|
211
|
|
|
|
|
|
|
|
|
211
|
|
|
|
|
211
|
|
|||||||||||||||
Dividends on preferred stock
|
|
|
|
|
|
|
|
(91
|
)
|
|
|
|
|
|
(91
|
)
|
|
|
|
(91
|
)
|
|||||||||||||||
Dividends on common stock
|
|
|
|
|
|
|
|
(1,101
|
)
|
|
|
|
|
|
(1,101
|
)
|
|
|
|
(1,101
|
)
|
|||||||||||||||
Change in equity of noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
(55
|
)
|
|
(55
|
)
|
||||||||||||||
Net income (loss)
|
|
|
|
|
|
|
|
4,788
|
|
|
|
|
|
|
4,788
|
|
|
21
|
|
|
4,809
|
|
||||||||||||||
Other comprehensive income (loss), net of income tax
|
|
|
|
|
|
|
|
|
|
|
|
5,888
|
|
|
5,888
|
|
|
(15
|
)
|
|
5,873
|
|
||||||||||||||
Balance at September 30, 2014
|
|
$
|
1
|
|
|
$
|
11
|
|
|
$
|
29,488
|
|
|
$
|
30,928
|
|
|
$
|
(615
|
)
|
|
$
|
10,992
|
|
|
$
|
70,805
|
|
|
$
|
494
|
|
|
$
|
71,299
|
|
(1)
|
Net income (loss) attributable to noncontrolling interests excludes losses of redeemable noncontrolling interests in partially-owned consolidated subsidiaries
of less than
$1 million
at both
September 30,
2015
and
2014
.
|
|
Nine Months
Ended September 30, |
||||||
|
2015
|
|
2014
|
||||
Net cash provided by (used in) operating activities
|
$
|
9,527
|
|
|
$
|
10,950
|
|
Cash flows from investing activities
|
|
|
|
||||
Sales, maturities and repayments of:
|
|
|
|
||||
Fixed maturity securities
|
109,308
|
|
|
85,187
|
|
||
Equity securities
|
478
|
|
|
455
|
|
||
Mortgage loans
|
9,775
|
|
|
10,917
|
|
||
Real estate and real estate joint ventures
|
1,644
|
|
|
532
|
|
||
Other limited partnership interests
|
859
|
|
|
555
|
|
||
Purchases of:
|
|
|
|
||||
Fixed maturity securities
|
(105,128
|
)
|
|
(94,085
|
)
|
||
Equity securities
|
(431
|
)
|
|
(455
|
)
|
||
Mortgage loans
|
(13,814
|
)
|
|
(11,772
|
)
|
||
Real estate and real estate joint ventures
|
(977
|
)
|
|
(1,382
|
)
|
||
Other limited partnership interests
|
(935
|
)
|
|
(1,338
|
)
|
||
Cash received in connection with freestanding derivatives
|
2,376
|
|
|
977
|
|
||
Cash paid in connection with freestanding derivatives
|
(2,887
|
)
|
|
(2,530
|
)
|
||
Cash received under repurchase agreements (Note 5)
|
199
|
|
|
—
|
|
||
Cash paid under reverse repurchase agreements (Note 5)
|
(199
|
)
|
|
—
|
|
||
Sales of businesses, net of cash and cash equivalents disposed of $0 and $262, respectively
|
—
|
|
|
452
|
|
||
Purchases of investments in insurance joint ventures
|
—
|
|
|
(277
|
)
|
||
Net change in policy loans
|
10
|
|
|
(19
|
)
|
||
Net change in short-term investments
|
(6,644
|
)
|
|
1,496
|
|
||
Net change in other invested assets
|
(350
|
)
|
|
(251
|
)
|
||
Other, net
|
(191
|
)
|
|
(131
|
)
|
||
Net cash provided by (used in) investing activities
|
(6,907
|
)
|
|
(11,669
|
)
|
||
Cash flows from financing activities
|
|
|
|
||||
Policyholder account balances:
|
|
|
|
||||
Deposits
|
69,383
|
|
|
73,855
|
|
||
Withdrawals
|
(72,940
|
)
|
|
(71,301
|
)
|
||
Net change in payables for collateral under securities loaned and other transactions
|
2,664
|
|
|
3,481
|
|
||
Net change in short-term debt
|
—
|
|
|
(75
|
)
|
||
Long-term debt issued
|
1,578
|
|
|
1,000
|
|
||
Long-term debt repaid
|
(1,078
|
)
|
|
(2,802
|
)
|
||
Collateral financing arrangements repaid
|
(44
|
)
|
|
—
|
|
||
Cash received (paid) in connection with collateral financing arrangements
|
6
|
|
|
—
|
|
||
Treasury stock acquired in connection with share repurchases
|
(1,107
|
)
|
|
(443
|
)
|
||
Preferred stock issued, net of issuance costs
|
1,483
|
|
|
—
|
|
||
Repurchase of preferred stock
|
(1,460
|
)
|
|
—
|
|
||
Preferred stock repurchase premium
|
(42
|
)
|
|
—
|
|
||
Dividends on preferred stock
|
(67
|
)
|
|
(91
|
)
|
||
Dividends on common stock
|
(1,234
|
)
|
|
(1,101
|
)
|
||
Other, net
|
6
|
|
|
(546
|
)
|
||
Net cash provided by (used in) financing activities
|
(2,852
|
)
|
|
1,977
|
|
||
Effect of change in foreign currency exchange rates on cash and cash equivalents balances
|
(360
|
)
|
|
(60
|
)
|
||
Change in cash and cash equivalents
|
(592
|
)
|
|
1,198
|
|
||
Cash and cash equivalents, beginning of period
|
10,808
|
|
|
7,585
|
|
||
Cash and cash equivalents, end of period
|
$
|
10,216
|
|
|
$
|
8,783
|
|
Supplemental disclosures of cash flow information
|
|
|
|
||||
Net cash paid (received) for:
|
|
|
|
||||
Interest
|
$
|
836
|
|
|
$
|
841
|
|
Income tax
|
$
|
904
|
|
|
$
|
413
|
|
Non-cash transactions:
|
|
|
|
||||
Fixed maturity securities received in connection with pension closeout transactions
|
$
|
903
|
|
|
$
|
—
|
|
Deconsolidation of MetLife Core Property Fund:
|
|
|
|
||||
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 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.
|
•
|
Retail’s operating earnings
increased
(decreased)
by
$86 million
and
$135 million
, net of
($111) million
and
($200) million
of income tax expense (benefit)
,
respectively
;
|
•
|
Group, Voluntary & Worksite Benefits’ operating earnings
increased
(decreased)
by
$4 million
and
$10 million
, net of
($2) million
and
$2 million
of income tax expense (benefit)
,
respectively
;
|
•
|
Corporate Benefit Funding’s operating earnings
increased
(decreased)
by
($13) million
and
($39) million
, net of
($10) million
and
($32) million
of income tax expense (benefit)
,
respectively
;
|
•
|
Latin America’s operating earnings
increased (decreased)
by
($30) million
and
($79) million
, net of
($16) million
and
($46) million
of income tax expense (benefit)
,
respectively
;
|
•
|
Asia’s operating earnings
increased
(decreased)
by
$4 million
and
$14 million
, net of
$3 million
and
$5 million
of income tax expense (benefit)
,
respectively
;
|
•
|
EMEA’s operating earnings
increased (decreased)
by
($18) million
and
($56) million
, net of
($13) million
and
($31) million
of income tax expense (benefit)
,
respectively
; and
|
•
|
Corporate & Other’s operating earnings
increased
(decreased)
by
($33) million
and
$15 million
, net of
$149 million
and
$302 million
of income tax expense (benefit)
,
respectively
.
|
|
|
Operating Results
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Three Months Ended September 30, 2015
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Total
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
|
Adjustments
|
|
Total
Consolidated
|
||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Premiums
|
|
$
|
1,806
|
|
|
$
|
4,092
|
|
|
$
|
1,555
|
|
|
$
|
668
|
|
|
$
|
8,121
|
|
|
$
|
1,736
|
|
|
$
|
501
|
|
|
$
|
18
|
|
|
$
|
10,376
|
|
|
$
|
(1
|
)
|
|
$
|
10,375
|
|
Universal life and investment-type product policy fees
|
|
1,229
|
|
|
188
|
|
|
55
|
|
|
261
|
|
|
1,733
|
|
|
382
|
|
|
106
|
|
|
26
|
|
|
2,247
|
|
|
99
|
|
|
2,346
|
|
|||||||||||
Net investment income
|
|
1,930
|
|
|
485
|
|
|
1,391
|
|
|
279
|
|
|
4,085
|
|
|
670
|
|
|
82
|
|
|
12
|
|
|
4,849
|
|
|
(890
|
)
|
|
3,959
|
|
|||||||||||
Other revenues
|
|
241
|
|
|
113
|
|
|
70
|
|
|
11
|
|
|
435
|
|
|
26
|
|
|
11
|
|
|
23
|
|
|
495
|
|
|
(11
|
)
|
|
484
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
382
|
|
|
382
|
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
485
|
|
|
485
|
|
|||||||||||
Total revenues
|
|
5,206
|
|
|
4,878
|
|
|
3,071
|
|
|
1,219
|
|
|
14,374
|
|
|
2,814
|
|
|
700
|
|
|
79
|
|
|
17,967
|
|
|
64
|
|
|
18,031
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
2,607
|
|
|
3,805
|
|
|
2,154
|
|
|
630
|
|
|
9,196
|
|
|
1,331
|
|
|
233
|
|
|
20
|
|
|
10,780
|
|
|
(92
|
)
|
|
10,688
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
550
|
|
|
39
|
|
|
295
|
|
|
88
|
|
|
972
|
|
|
327
|
|
|
27
|
|
|
5
|
|
|
1,331
|
|
|
(684
|
)
|
|
647
|
|
|||||||||||
Capitalization of DAC
|
|
(266
|
)
|
|
(41
|
)
|
|
(1
|
)
|
|
(105
|
)
|
|
(413
|
)
|
|
(435
|
)
|
|
(107
|
)
|
|
—
|
|
|
(955
|
)
|
|
—
|
|
|
(955
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
432
|
|
|
40
|
|
|
6
|
|
|
57
|
|
|
535
|
|
|
309
|
|
|
127
|
|
|
—
|
|
|
971
|
|
|
160
|
|
|
1,131
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(77
|
)
|
|
(5
|
)
|
|
—
|
|
|
(82
|
)
|
|
(8
|
)
|
|
(90
|
)
|
|||||||||||
Interest expense on debt
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
294
|
|
|
294
|
|
|
8
|
|
|
302
|
|
|||||||||||
Other expenses
|
|
1,197
|
|
|
666
|
|
|
113
|
|
|
410
|
|
|
2,386
|
|
|
896
|
|
|
352
|
|
|
492
|
|
|
4,126
|
|
|
19
|
|
|
4,145
|
|
|||||||||||
Total expenses
|
|
4,519
|
|
|
4,509
|
|
|
2,568
|
|
|
1,080
|
|
|
12,676
|
|
|
2,351
|
|
|
627
|
|
|
811
|
|
|
16,465
|
|
|
(597
|
)
|
|
15,868
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
164
|
|
|
131
|
|
|
177
|
|
|
(37
|
)
|
|
435
|
|
|
125
|
|
|
7
|
|
|
224
|
|
|
791
|
|
|
174
|
|
|
965
|
|
|||||||||||
Operating earnings
|
|
$
|
523
|
|
|
$
|
238
|
|
|
$
|
326
|
|
|
$
|
176
|
|
|
$
|
1,263
|
|
|
$
|
338
|
|
|
$
|
66
|
|
|
$
|
(956
|
)
|
|
711
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
64
|
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
597
|
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
(174
|
)
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
1,198
|
|
|
|
|
$
|
1,198
|
|
|
|
Operating Results
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Three Months Ended September 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
|
|
$
|
1,869
|
|
|
$
|
4,010
|
|
|
$
|
451
|
|
|
$
|
812
|
|
|
$
|
7,142
|
|
|
$
|
1,939
|
|
|
$
|
581
|
|
|
$
|
23
|
|
|
$
|
9,685
|
|
|
$
|
18
|
|
|
$
|
9,703
|
|
Universal life and investment-type product policy fees
|
|
1,311
|
|
|
180
|
|
|
60
|
|
|
328
|
|
|
1,879
|
|
|
487
|
|
|
127
|
|
|
29
|
|
|
2,522
|
|
|
106
|
|
|
2,628
|
|
|||||||||||
Net investment income
|
|
1,965
|
|
|
475
|
|
|
1,464
|
|
|
317
|
|
|
4,221
|
|
|
738
|
|
|
109
|
|
|
125
|
|
|
5,193
|
|
|
217
|
|
|
5,410
|
|
|||||||||||
Other revenues
|
|
275
|
|
|
103
|
|
|
71
|
|
|
7
|
|
|
456
|
|
|
27
|
|
|
22
|
|
|
13
|
|
|
518
|
|
|
—
|
|
|
518
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
109
|
|
|
109
|
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
478
|
|
|
478
|
|
|||||||||||
Total revenues
|
|
5,420
|
|
|
4,768
|
|
|
2,046
|
|
|
1,464
|
|
|
13,698
|
|
|
3,191
|
|
|
839
|
|
|
190
|
|
|
17,918
|
|
|
928
|
|
|
18,846
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
2,555
|
|
|
3,729
|
|
|
1,033
|
|
|
735
|
|
|
8,052
|
|
|
1,535
|
|
|
252
|
|
|
15
|
|
|
9,854
|
|
|
5
|
|
|
9,859
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
567
|
|
|
38
|
|
|
279
|
|
|
97
|
|
|
981
|
|
|
394
|
|
|
43
|
|
|
8
|
|
|
1,426
|
|
|
391
|
|
|
1,817
|
|
|||||||||||
Capitalization of DAC
|
|
(239
|
)
|
|
(37
|
)
|
|
(11
|
)
|
|
(112
|
)
|
|
(399
|
)
|
|
(507
|
)
|
|
(165
|
)
|
|
—
|
|
|
(1,071
|
)
|
|
—
|
|
|
(1,071
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
335
|
|
|
38
|
|
|
5
|
|
|
102
|
|
|
480
|
|
|
367
|
|
|
152
|
|
|
—
|
|
|
999
|
|
|
55
|
|
|
1,054
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(89
|
)
|
|
(7
|
)
|
|
—
|
|
|
(96
|
)
|
|
(11
|
)
|
|
(107
|
)
|
|||||||||||
Interest expense on debt
|
|
(1
|
)
|
|
—
|
|
|
2
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
291
|
|
|
292
|
|
|
3
|
|
|
295
|
|
|||||||||||
Other expenses
|
|
1,163
|
|
|
634
|
|
|
133
|
|
|
450
|
|
|
2,380
|
|
|
1,027
|
|
|
463
|
|
|
133
|
|
|
4,003
|
|
|
44
|
|
|
4,047
|
|
|||||||||||
Total expenses
|
|
4,380
|
|
|
4,402
|
|
|
1,441
|
|
|
1,272
|
|
|
11,495
|
|
|
2,727
|
|
|
738
|
|
|
447
|
|
|
15,407
|
|
|
487
|
|
|
15,894
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
255
|
|
|
125
|
|
|
210
|
|
|
70
|
|
|
660
|
|
|
154
|
|
|
23
|
|
|
(181
|
)
|
|
656
|
|
|
202
|
|
|
858
|
|
|||||||||||
Operating earnings
|
|
$
|
785
|
|
|
$
|
241
|
|
|
$
|
395
|
|
|
$
|
122
|
|
|
$
|
1,543
|
|
|
$
|
310
|
|
|
$
|
78
|
|
|
$
|
(76
|
)
|
|
1,855
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
928
|
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(487
|
)
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
(202
|
)
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
2,094
|
|
|
|
|
$
|
2,094
|
|
|
|
Operating Results
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2015
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Total
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
|
Adjustments
|
|
Total
Consolidated
|
||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Premiums
|
|
$
|
5,302
|
|
|
$
|
12,313
|
|
|
$
|
2,292
|
|
|
$
|
2,150
|
|
|
$
|
22,057
|
|
|
$
|
5,297
|
|
|
$
|
1,534
|
|
|
$
|
54
|
|
|
$
|
28,942
|
|
|
$
|
(2
|
)
|
|
$
|
28,940
|
|
Universal life and investment-type product policy fees
|
|
3,717
|
|
|
559
|
|
|
168
|
|
|
856
|
|
|
5,300
|
|
|
1,179
|
|
|
322
|
|
|
75
|
|
|
6,876
|
|
|
298
|
|
|
7,174
|
|
|||||||||||
Net investment income
|
|
5,913
|
|
|
1,444
|
|
|
4,347
|
|
|
780
|
|
|
12,484
|
|
|
2,033
|
|
|
249
|
|
|
250
|
|
|
15,016
|
|
|
(649
|
)
|
|
14,367
|
|
|||||||||||
Other revenues
|
|
755
|
|
|
340
|
|
|
218
|
|
|
28
|
|
|
1,341
|
|
|
82
|
|
|
40
|
|
|
62
|
|
|
1,525
|
|
|
(28
|
)
|
|
1,497
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
535
|
|
|
535
|
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
394
|
|
|
394
|
|
|||||||||||
Total revenues
|
|
15,687
|
|
|
14,656
|
|
|
7,025
|
|
|
3,814
|
|
|
41,182
|
|
|
8,591
|
|
|
2,145
|
|
|
441
|
|
|
52,359
|
|
|
548
|
|
|
52,907
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
7,429
|
|
|
11,445
|
|
|
4,078
|
|
|
1,955
|
|
|
24,907
|
|
|
4,046
|
|
|
737
|
|
|
40
|
|
|
29,730
|
|
|
237
|
|
|
29,967
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
1,643
|
|
|
114
|
|
|
882
|
|
|
263
|
|
|
2,902
|
|
|
992
|
|
|
91
|
|
|
19
|
|
|
4,004
|
|
|
(64
|
)
|
|
3,940
|
|
|||||||||||
Capitalization of DAC
|
|
(770
|
)
|
|
(113
|
)
|
|
(11
|
)
|
|
(316
|
)
|
|
(1,210
|
)
|
|
(1,268
|
)
|
|
(372
|
)
|
|
—
|
|
|
(2,850
|
)
|
|
—
|
|
|
(2,850
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
1,207
|
|
|
120
|
|
|
17
|
|
|
221
|
|
|
1,565
|
|
|
971
|
|
|
388
|
|
|
1
|
|
|
2,925
|
|
|
128
|
|
|
3,053
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(241
|
)
|
|
(13
|
)
|
|
—
|
|
|
(255
|
)
|
|
(27
|
)
|
|
(282
|
)
|
|||||||||||
Interest expense on debt
|
|
(2
|
)
|
|
—
|
|
|
3
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
897
|
|
|
898
|
|
|
10
|
|
|
908
|
|
|||||||||||
Other expenses
|
|
3,593
|
|
|
2,011
|
|
|
367
|
|
|
1,254
|
|
|
7,225
|
|
|
2,669
|
|
|
1,103
|
|
|
811
|
|
|
11,808
|
|
|
28
|
|
|
11,836
|
|
|||||||||||
Total expenses
|
|
13,100
|
|
|
13,577
|
|
|
5,336
|
|
|
3,376
|
|
|
35,389
|
|
|
7,169
|
|
|
1,934
|
|
|
1,768
|
|
|
46,260
|
|
|
312
|
|
|
46,572
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
721
|
|
|
382
|
|
|
588
|
|
|
15
|
|
|
1,706
|
|
|
332
|
|
|
25
|
|
|
(139
|
)
|
|
1,924
|
|
|
(69
|
)
|
|
1,855
|
|
|||||||||||
Operating earnings
|
|
$
|
1,866
|
|
|
$
|
697
|
|
|
$
|
1,101
|
|
|
$
|
423
|
|
|
$
|
4,087
|
|
|
$
|
1,090
|
|
|
$
|
186
|
|
|
$
|
(1,188
|
)
|
|
4,175
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
548
|
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(312
|
)
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
69
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
4,480
|
|
|
|
|
$
|
4,480
|
|
|
|
Operating Results
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
Nine Months Ended September 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
|
|
$
|
5,405
|
|
|
$
|
12,050
|
|
|
$
|
1,438
|
|
|
$
|
2,293
|
|
|
$
|
21,186
|
|
|
$
|
5,742
|
|
|
$
|
1,762
|
|
|
$
|
65
|
|
|
$
|
28,755
|
|
|
$
|
40
|
|
|
$
|
28,795
|
|
Universal life and investment-type product policy fees
|
|
3,814
|
|
|
538
|
|
|
172
|
|
|
956
|
|
|
5,480
|
|
|
1,276
|
|
|
353
|
|
|
96
|
|
|
7,205
|
|
|
302
|
|
|
7,507
|
|
|||||||||||
Net investment income
|
|
5,906
|
|
|
1,396
|
|
|
4,259
|
|
|
915
|
|
|
12,476
|
|
|
2,162
|
|
|
328
|
|
|
407
|
|
|
15,373
|
|
|
331
|
|
|
15,704
|
|
|||||||||||
Other revenues
|
|
785
|
|
|
314
|
|
|
214
|
|
|
23
|
|
|
1,336
|
|
|
78
|
|
|
49
|
|
|
39
|
|
|
1,502
|
|
|
(16
|
)
|
|
1,486
|
|
|||||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(427
|
)
|
|
(427
|
)
|
|||||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,132
|
|
|
1,132
|
|
|||||||||||
Total revenues
|
|
15,910
|
|
|
14,298
|
|
|
6,083
|
|
|
4,187
|
|
|
40,478
|
|
|
9,258
|
|
|
2,492
|
|
|
607
|
|
|
52,835
|
|
|
1,362
|
|
|
54,197
|
|
|||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Policyholder benefits and claims and policyholder dividends
|
|
7,400
|
|
|
11,299
|
|
|
3,194
|
|
|
2,100
|
|
|
23,993
|
|
|
4,357
|
|
|
784
|
|
|
57
|
|
|
29,191
|
|
|
680
|
|
|
29,871
|
|
|||||||||||
Interest credited to policyholder account balances
|
|
1,683
|
|
|
117
|
|
|
844
|
|
|
295
|
|
|
2,939
|
|
|
1,175
|
|
|
112
|
|
|
26
|
|
|
4,252
|
|
|
743
|
|
|
4,995
|
|
|||||||||||
Capitalization of DAC
|
|
(722
|
)
|
|
(107
|
)
|
|
(30
|
)
|
|
(320
|
)
|
|
(1,179
|
)
|
|
(1,458
|
)
|
|
(511
|
)
|
|
—
|
|
|
(3,148
|
)
|
|
(1
|
)
|
|
(3,149
|
)
|
|||||||||||
Amortization of DAC and VOBA
|
|
1,142
|
|
|
109
|
|
|
15
|
|
|
265
|
|
|
1,531
|
|
|
1,067
|
|
|
476
|
|
|
—
|
|
|
3,074
|
|
|
100
|
|
|
3,174
|
|
|||||||||||
Amortization of negative VOBA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(275
|
)
|
|
(22
|
)
|
|
—
|
|
|
(298
|
)
|
|
(35
|
)
|
|
(333
|
)
|
|||||||||||
Interest expense on debt
|
|
(1
|
)
|
|
—
|
|
|
6
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
880
|
|
|
885
|
|
|
34
|
|
|
919
|
|
|||||||||||
Other expenses
|
|
3,486
|
|
|
1,900
|
|
|
377
|
|
|
1,322
|
|
|
7,085
|
|
|
2,995
|
|
|
1,383
|
|
|
470
|
|
|
11,933
|
|
|
59
|
|
|
11,992
|
|
|||||||||||
Total expenses
|
|
12,988
|
|
|
13,318
|
|
|
4,406
|
|
|
3,661
|
|
|
34,373
|
|
|
7,861
|
|
|
2,222
|
|
|
1,433
|
|
|
45,889
|
|
|
1,580
|
|
|
47,469
|
|
|||||||||||
Provision for income tax expense (benefit)
|
|
824
|
|
|
340
|
|
|
579
|
|
|
110
|
|
|
1,853
|
|
|
430
|
|
|
49
|
|
|
(454
|
)
|
|
1,878
|
|
|
38
|
|
|
1,916
|
|
|||||||||||
Operating earnings
|
|
$
|
2,098
|
|
|
$
|
640
|
|
|
$
|
1,098
|
|
|
$
|
416
|
|
|
$
|
4,252
|
|
|
$
|
967
|
|
|
$
|
221
|
|
|
$
|
(372
|
)
|
|
5,068
|
|
|
|
|
|
|||||
Adjustments to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||
Total revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,362
|
|
|
|
|
|
|||||||||||||||||||||
Total expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,580
|
)
|
|
|
|
|
|||||||||||||||||||||
Provision for income tax (expense) benefit
|
|
(38
|
)
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
4,812
|
|
|
|
|
$
|
4,812
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Retail
|
$
|
347,126
|
|
|
$
|
359,188
|
|
Group, Voluntary & Worksite Benefits
|
47,443
|
|
|
46,483
|
|
||
Corporate Benefit Funding
|
227,297
|
|
|
228,543
|
|
||
Latin America
|
64,949
|
|
|
72,259
|
|
||
Asia
|
112,456
|
|
|
117,894
|
|
||
EMEA
|
27,698
|
|
|
29,217
|
|
||
Corporate & Other
|
55,491
|
|
|
48,753
|
|
||
Total
|
$
|
882,460
|
|
|
$
|
902,337
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||
|
In the
Event of Death
|
|
At
Annuitization
|
|
In the
Event of Death
|
|
At
Annuitization
|
||||||||
|
(In millions)
|
||||||||||||||
Annuity Contracts
(1)
|
|
|
|
|
|
|
|
||||||||
Variable Annuities
|
|
|
|
|
|
|
|
||||||||
Total contract account value (2)
|
$
|
179,887
|
|
|
$
|
90,852
|
|
|
$
|
196,595
|
|
|
$
|
99,000
|
|
Separate account value
|
$
|
149,829
|
|
|
$
|
87,417
|
|
|
$
|
163,566
|
|
|
$
|
95,963
|
|
Net amount at risk (2)
|
$
|
11,374
|
|
|
$
|
2,909
|
|
|
$
|
4,230
|
|
|
$
|
1,770
|
|
Average attained age of contractholders
|
66 years
|
|
|
66 years
|
|
|
65 years
|
|
|
65 years
|
|
||||
Two Tier and Other Annuities
|
|
|
|
|
|
|
|
||||||||
Account value
|
N/A
|
|
|
$
|
1,621
|
|
|
N/A
|
|
|
$
|
1,040
|
|
||
Net amount at risk
|
N/A
|
|
|
$
|
444
|
|
|
N/A
|
|
|
$
|
340
|
|
||
Average attained age of contractholders
|
N/A
|
|
|
53 years
|
|
|
N/A
|
|
|
50 years
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||
|
Secondary
Guarantees
|
|
Paid-Up
Guarantees
|
|
Secondary
Guarantees
|
|
Paid-Up
Guarantees
|
||||||||
|
(In millions)
|
||||||||||||||
Universal and Variable Life Contracts
(1)
|
|
|
|
|
|
|
|
||||||||
Account value (general and separate account)
|
$
|
16,994
|
|
|
$
|
3,490
|
|
|
$
|
16,875
|
|
|
$
|
3,587
|
|
Net amount at risk
|
$
|
177,022
|
|
|
$
|
19,360
|
|
|
$
|
180,069
|
|
|
$
|
20,344
|
|
Average attained age of policyholders
|
57 years
|
|
|
62 years
|
|
|
56 years
|
|
|
61 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 business of certain variable annuity products from the Company’s former operating joint venture in Japan.
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
|
(In millions)
|
||||||
Closed Block Liabilities
|
|
|
|
|
||||
Future policy benefits
|
|
$
|
41,280
|
|
|
$
|
41,667
|
|
Other policy-related balances
|
|
275
|
|
|
265
|
|
||
Policyholder dividends payable
|
|
498
|
|
|
461
|
|
||
Policyholder dividend obligation
|
|
2,309
|
|
|
3,155
|
|
||
Current income tax payable
|
|
29
|
|
|
1
|
|
||
Other liabilities
|
|
474
|
|
|
646
|
|
||
Total closed block liabilities
|
|
44,865
|
|
|
46,195
|
|
||
Assets Designated to the Closed Block
|
|
|
|
|
||||
Investments:
|
|
|
|
|
||||
Fixed maturity securities available-for-sale, at estimated fair value
|
|
27,739
|
|
|
29,199
|
|
||
Equity securities available-for-sale, at estimated fair value
|
|
94
|
|
|
91
|
|
||
Mortgage loans
|
|
6,122
|
|
|
6,076
|
|
||
Policy loans
|
|
4,641
|
|
|
4,646
|
|
||
Real estate and real estate joint ventures
|
|
601
|
|
|
666
|
|
||
Other invested assets
|
|
1,203
|
|
|
1,065
|
|
||
Total investments
|
|
40,400
|
|
|
41,743
|
|
||
Cash and cash equivalents
|
|
266
|
|
|
227
|
|
||
Accrued investment income
|
|
484
|
|
|
477
|
|
||
Premiums, reinsurance and other receivables
|
|
106
|
|
|
67
|
|
||
Deferred income tax assets
|
|
286
|
|
|
289
|
|
||
Total assets designated to the closed block
|
|
41,542
|
|
|
42,803
|
|
||
Excess of closed block liabilities over assets designated to the closed block
|
|
3,323
|
|
|
3,392
|
|
||
Amounts included in accumulated other comprehensive income (loss) (“AOCI”)
|
|
|
|
|
||||
Unrealized investment gains (losses), net of income tax
|
|
1,712
|
|
|
2,291
|
|
||
Unrealized gains (losses) on derivatives, net of income tax
|
|
63
|
|
|
28
|
|
||
Allocated to policyholder dividend obligation, net of income tax
|
|
(1,501
|
)
|
|
(2,051
|
)
|
||
Total amounts included in AOCI
|
|
274
|
|
|
268
|
|
||
Maximum future earnings to be recognized from closed block assets and liabilities
|
|
$
|
3,597
|
|
|
$
|
3,660
|
|
|
|
Nine Months
Ended September 30, 2015 |
|
Year
Ended December 31, 2014 |
||||
|
|
(In millions)
|
||||||
Balance, beginning of period
|
|
$
|
3,155
|
|
|
$
|
1,771
|
|
Change in unrealized investment and derivative gains (losses)
|
|
(846
|
)
|
|
1,384
|
|
||
Balance, end of period
|
|
$
|
2,309
|
|
|
$
|
3,155
|
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
||||||||
Premiums
|
|
$
|
447
|
|
|
$
|
461
|
|
|
$
|
1,334
|
|
|
$
|
1,380
|
|
Net investment income
|
|
487
|
|
|
516
|
|
|
1,500
|
|
|
1,568
|
|
||||
Net investment gains (losses)
|
|
(9
|
)
|
|
—
|
|
|
(8
|
)
|
|
8
|
|
||||
Net derivative gains (losses)
|
|
13
|
|
|
17
|
|
|
25
|
|
|
13
|
|
||||
Total revenues
|
|
938
|
|
|
994
|
|
|
2,851
|
|
|
2,969
|
|
||||
Expenses
|
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims
|
|
635
|
|
|
620
|
|
|
1,886
|
|
|
1,889
|
|
||||
Policyholder dividends
|
|
273
|
|
|
255
|
|
|
757
|
|
|
731
|
|
||||
Other expenses
|
|
36
|
|
|
39
|
|
|
109
|
|
|
118
|
|
||||
Total expenses
|
|
944
|
|
|
914
|
|
|
2,752
|
|
|
2,738
|
|
||||
Revenues, net of expenses before provision for income tax expense (benefit)
|
|
(6
|
)
|
|
80
|
|
|
99
|
|
|
231
|
|
||||
Provision for income tax expense (benefit)
|
|
(1
|
)
|
|
28
|
|
|
36
|
|
|
81
|
|
||||
Revenues, net of expenses and provision for income tax expense (benefit)
|
|
$
|
(5
|
)
|
|
$
|
52
|
|
|
$
|
63
|
|
|
$
|
150
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||||||||||||||||||||
|
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
|
$
|
95,156
|
|
|
$
|
7,525
|
|
|
$
|
1,717
|
|
|
$
|
7
|
|
|
$
|
100,957
|
|
|
$
|
96,235
|
|
|
$
|
10,343
|
|
|
$
|
624
|
|
|
$
|
—
|
|
|
$
|
105,954
|
|
Foreign corporate
|
56,545
|
|
|
3,465
|
|
|
1,606
|
|
|
—
|
|
|
58,404
|
|
|
57,695
|
|
|
4,651
|
|
|
664
|
|
|
7
|
|
|
61,675
|
|
||||||||||
U.S. Treasury and agency
|
53,624
|
|
|
6,216
|
|
|
169
|
|
|
—
|
|
|
59,671
|
|
|
54,654
|
|
|
6,892
|
|
|
30
|
|
|
—
|
|
|
61,516
|
|
||||||||||
Foreign government
|
45,346
|
|
|
5,361
|
|
|
184
|
|
|
—
|
|
|
50,523
|
|
|
47,327
|
|
|
5,500
|
|
|
161
|
|
|
—
|
|
|
52,666
|
|
||||||||||
RMBS
|
38,696
|
|
|
1,720
|
|
|
288
|
|
|
78
|
|
|
40,050
|
|
|
38,064
|
|
|
2,102
|
|
|
214
|
|
|
106
|
|
|
39,846
|
|
||||||||||
State and political subdivision
|
13,678
|
|
|
1,863
|
|
|
53
|
|
|
9
|
|
|
15,479
|
|
|
12,922
|
|
|
2,291
|
|
|
26
|
|
|
—
|
|
|
15,187
|
|
||||||||||
CMBS (1)
|
12,001
|
|
|
437
|
|
|
77
|
|
|
(1
|
)
|
|
12,362
|
|
|
13,762
|
|
|
615
|
|
|
46
|
|
|
(1
|
)
|
|
14,332
|
|
||||||||||
ABS
|
14,157
|
|
|
162
|
|
|
181
|
|
|
6
|
|
|
14,132
|
|
|
14,121
|
|
|
240
|
|
|
112
|
|
|
—
|
|
|
14,249
|
|
||||||||||
Total fixed maturity securities
|
$
|
329,203
|
|
|
$
|
26,749
|
|
|
$
|
4,275
|
|
|
$
|
99
|
|
|
$
|
351,578
|
|
|
$
|
334,780
|
|
|
$
|
32,634
|
|
|
$
|
1,877
|
|
|
$
|
112
|
|
|
$
|
365,425
|
|
Equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Common stock
|
$
|
2,040
|
|
|
$
|
375
|
|
|
$
|
99
|
|
|
$
|
—
|
|
|
$
|
2,316
|
|
|
$
|
1,990
|
|
|
$
|
554
|
|
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
2,516
|
|
Non-redeemable preferred stock
|
1,056
|
|
|
75
|
|
|
48
|
|
|
—
|
|
|
1,083
|
|
|
1,086
|
|
|
68
|
|
|
39
|
|
|
—
|
|
|
1,115
|
|
||||||||||
Total equity securities
|
$
|
3,096
|
|
|
$
|
450
|
|
|
$
|
147
|
|
|
$
|
—
|
|
|
$
|
3,399
|
|
|
$
|
3,076
|
|
|
$
|
622
|
|
|
$
|
67
|
|
|
$
|
—
|
|
|
$
|
3,631
|
|
(1)
|
The noncredit loss component of other-than-temporary-impairment (“OTTI”) losses for CMBS was in an unrealized gain position of
$1 million
at both
September 30, 2015
and
December 31, 2014
, due to increases in estimated fair value subsequent to initial recognition of noncredit losses on such securities. See also “— Net Unrealized Investment Gains (Losses).”
|
|
Due in One Year or Less
|
|
Due After One Year Through Five Years
|
|
Due After Five Years Through Ten Years
|
|
Due After Ten Years
|
|
Structured Securities
|
|
Total Fixed Maturity Securities
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Amortized cost
|
$
|
13,401
|
|
|
$
|
72,334
|
|
|
$
|
70,970
|
|
|
$
|
107,644
|
|
|
$
|
64,854
|
|
|
$
|
329,203
|
|
Estimated fair value
|
$
|
13,476
|
|
|
$
|
75,724
|
|
|
$
|
74,741
|
|
|
$
|
121,093
|
|
|
$
|
66,544
|
|
|
$
|
351,578
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||||||||||||
|
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
|
$
|
23,232
|
|
|
$
|
1,323
|
|
|
$
|
3,027
|
|
|
$
|
401
|
|
|
$
|
11,389
|
|
|
$
|
331
|
|
|
$
|
4,658
|
|
|
$
|
293
|
|
Foreign corporate
|
14,386
|
|
|
1,043
|
|
|
3,343
|
|
|
563
|
|
|
9,410
|
|
|
505
|
|
|
2,074
|
|
|
166
|
|
||||||||
U.S. Treasury and agency
|
3,180
|
|
|
167
|
|
|
303
|
|
|
2
|
|
|
8,927
|
|
|
12
|
|
|
1,314
|
|
|
18
|
|
||||||||
Foreign government
|
2,881
|
|
|
118
|
|
|
433
|
|
|
66
|
|
|
1,085
|
|
|
80
|
|
|
630
|
|
|
81
|
|
||||||||
RMBS
|
6,431
|
|
|
179
|
|
|
2,077
|
|
|
187
|
|
|
4,180
|
|
|
92
|
|
|
2,534
|
|
|
228
|
|
||||||||
State and political subdivision
|
1,415
|
|
|
43
|
|
|
100
|
|
|
19
|
|
|
83
|
|
|
1
|
|
|
297
|
|
|
25
|
|
||||||||
CMBS
|
2,401
|
|
|
46
|
|
|
600
|
|
|
30
|
|
|
1,268
|
|
|
23
|
|
|
934
|
|
|
22
|
|
||||||||
ABS
|
5,772
|
|
|
116
|
|
|
2,240
|
|
|
71
|
|
|
4,456
|
|
|
57
|
|
|
1,440
|
|
|
55
|
|
||||||||
Total fixed maturity securities
|
$
|
59,698
|
|
|
$
|
3,035
|
|
|
$
|
12,123
|
|
|
$
|
1,339
|
|
|
$
|
40,798
|
|
|
$
|
1,101
|
|
|
$
|
13,881
|
|
|
$
|
888
|
|
Equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common stock
|
$
|
292
|
|
|
$
|
98
|
|
|
$
|
9
|
|
|
$
|
1
|
|
|
$
|
111
|
|
|
$
|
28
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Non-redeemable preferred stock
|
89
|
|
|
3
|
|
|
183
|
|
|
45
|
|
|
67
|
|
|
2
|
|
|
192
|
|
|
37
|
|
||||||||
Total equity securities
|
$
|
381
|
|
|
$
|
101
|
|
|
$
|
192
|
|
|
$
|
46
|
|
|
$
|
178
|
|
|
$
|
30
|
|
|
$
|
193
|
|
|
$
|
37
|
|
Total number of securities in an unrealized loss position
|
5,256
|
|
|
|
|
1,275
|
|
|
|
|
3,153
|
|
|
|
|
1,435
|
|
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||
|
Carrying
Value
|
|
% of
Total
|
|
Carrying
Value
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Mortgage loans:
|
|
|
|
|
|
|
|
||||||
Commercial
|
$
|
41,619
|
|
|
65.5
|
%
|
|
$
|
41,088
|
|
|
68.3
|
%
|
Agricultural
|
12,771
|
|
|
20.1
|
|
|
12,378
|
|
|
20.6
|
|
||
Residential
|
8,955
|
|
|
14.1
|
|
|
6,369
|
|
|
10.6
|
|
||
Subtotal (1)
|
63,345
|
|
|
99.7
|
|
|
59,835
|
|
|
99.5
|
|
||
Valuation allowances
|
(311
|
)
|
|
(0.5
|
)
|
|
(305
|
)
|
|
(0.5
|
)
|
||
Subtotal mortgage loans, net
|
63,034
|
|
|
99.2
|
|
|
59,530
|
|
|
99.0
|
|
||
Residential — fair value option (“FVO”)
|
315
|
|
|
0.5
|
|
|
308
|
|
|
0.5
|
|
||
Commercial mortgage loans held by CSEs
—
FVO
|
204
|
|
|
0.3
|
|
|
280
|
|
|
0.5
|
|
||
Total mortgage loans, net
|
$
|
63,553
|
|
|
100.0
|
%
|
|
$
|
60,118
|
|
|
100.0
|
%
|
(1)
|
Purchases of mortgage loans were
$1.0 billion
and
$3.2 billion
for the
three months
and
nine months ended
September 30, 2015
, respectively. Purchases of mortgage loans were
$2.1 billion
and
$3.5 billion
for the
three months
and
nine months ended
September 30, 2014
, respectively.
|
|
Evaluated Individually for Credit Losses
|
|
Evaluated Collectively for Credit Losses
|
|
Impaired Loans
|
||||||||||||||||||||||||||
|
Impaired Loans with a Valuation Allowance
|
|
Impaired Loans without a Valuation Allowance
|
|
|
|
|
|
|
||||||||||||||||||||||
|
Unpaid Principal Balance
|
|
Recorded
Investment
|
|
Valuation
Allowances |
|
Unpaid Principal Balance
|
|
Recorded
Investment |
|
Recorded
Investment |
|
Valuation
Allowances |
|
Carrying
Value |
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
76
|
|
|
$
|
76
|
|
|
$
|
41,536
|
|
|
$
|
208
|
|
|
$
|
76
|
|
Agricultural
|
50
|
|
|
47
|
|
|
3
|
|
|
12
|
|
|
12
|
|
|
12,712
|
|
|
38
|
|
|
56
|
|
||||||||
Residential
|
—
|
|
|
—
|
|
|
—
|
|
|
118
|
|
|
109
|
|
|
8,846
|
|
|
55
|
|
|
109
|
|
||||||||
Total
|
$
|
57
|
|
|
$
|
54
|
|
|
$
|
10
|
|
|
$
|
206
|
|
|
$
|
197
|
|
|
$
|
63,094
|
|
|
$
|
301
|
|
|
$
|
241
|
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commercial
|
$
|
75
|
|
|
$
|
75
|
|
|
$
|
24
|
|
|
$
|
101
|
|
|
$
|
100
|
|
|
$
|
40,913
|
|
|
$
|
200
|
|
|
$
|
151
|
|
Agricultural
|
51
|
|
|
48
|
|
|
2
|
|
|
14
|
|
|
13
|
|
|
12,317
|
|
|
37
|
|
|
59
|
|
||||||||
Residential
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|
37
|
|
|
6,332
|
|
|
42
|
|
|
37
|
|
||||||||
Total
|
$
|
126
|
|
|
$
|
123
|
|
|
$
|
26
|
|
|
$
|
155
|
|
|
$
|
150
|
|
|
$
|
59,562
|
|
|
$
|
279
|
|
|
$
|
247
|
|
|
Nine Months
Ended September 30, |
||||||||||||||||||||||||||||||
|
2015
|
|
2014
|
||||||||||||||||||||||||||||
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
|
Commercial
|
|
Agricultural
|
|
Residential
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Balance, beginning of period
|
$
|
224
|
|
|
$
|
39
|
|
|
$
|
42
|
|
|
$
|
305
|
|
|
$
|
258
|
|
|
$
|
44
|
|
|
$
|
20
|
|
|
$
|
322
|
|
Provision (release)
|
3
|
|
|
2
|
|
|
27
|
|
|
32
|
|
|
(8
|
)
|
|
(5
|
)
|
|
25
|
|
|
12
|
|
||||||||
Charge-offs, net of recoveries
|
(12
|
)
|
|
—
|
|
|
(14
|
)
|
|
(26
|
)
|
|
(23
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(27
|
)
|
||||||||
Balance, end of period
|
$
|
215
|
|
|
$
|
41
|
|
|
$
|
55
|
|
|
$
|
311
|
|
|
$
|
227
|
|
|
$
|
38
|
|
|
$
|
42
|
|
|
$
|
307
|
|
|
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)
|
|
|
||||||||||||||||||
September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loan-to-value ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 65%
|
$
|
34,881
|
|
|
$
|
1,034
|
|
|
$
|
527
|
|
|
$
|
36,442
|
|
|
87.6
|
%
|
|
$
|
37,984
|
|
|
88.0
|
%
|
65% to 75%
|
3,997
|
|
|
217
|
|
|
68
|
|
|
4,282
|
|
|
10.3
|
|
|
4,296
|
|
|
10.0
|
|
|||||
76% to 80%
|
47
|
|
|
—
|
|
|
8
|
|
|
55
|
|
|
0.1
|
|
|
55
|
|
|
0.1
|
|
|||||
Greater than 80%
|
356
|
|
|
258
|
|
|
226
|
|
|
840
|
|
|
2.0
|
|
|
838
|
|
|
1.9
|
|
|||||
Total
|
$
|
39,281
|
|
|
$
|
1,509
|
|
|
$
|
829
|
|
|
$
|
41,619
|
|
|
100.0
|
%
|
|
$
|
43,173
|
|
|
100.0
|
%
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loan-to-value ratios
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Less than 65%
|
$
|
33,933
|
|
|
$
|
1,105
|
|
|
$
|
1,101
|
|
|
$
|
36,139
|
|
|
88.0
|
%
|
|
$
|
38,166
|
|
|
88.4
|
%
|
65% to 75%
|
3,306
|
|
|
405
|
|
|
87
|
|
|
3,798
|
|
|
9.2
|
|
|
3,873
|
|
|
9.0
|
|
|||||
76% to 80%
|
130
|
|
|
—
|
|
|
15
|
|
|
145
|
|
|
0.4
|
|
|
153
|
|
|
0.3
|
|
|||||
Greater than 80%
|
562
|
|
|
281
|
|
|
163
|
|
|
1,006
|
|
|
2.4
|
|
|
987
|
|
|
2.3
|
|
|||||
Total
|
$
|
37,931
|
|
|
$
|
1,791
|
|
|
$
|
1,366
|
|
|
$
|
41,088
|
|
|
100.0
|
%
|
|
$
|
43,179
|
|
|
100.0
|
%
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||
|
Recorded
Investment
|
|
% of
Total
|
|
Recorded
Investment
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Loan-to-value ratios
|
|
|
|
|
|
|
|
||||||
Less than 65%
|
$
|
12,093
|
|
|
94.7
|
%
|
|
$
|
11,743
|
|
|
94.9
|
%
|
65% to 75%
|
588
|
|
|
4.6
|
|
|
533
|
|
|
4.3
|
|
||
76% to 80%
|
22
|
|
|
0.2
|
|
|
17
|
|
|
0.1
|
|
||
Greater than 80%
|
68
|
|
|
0.5
|
|
|
85
|
|
|
0.7
|
|
||
Total
|
$
|
12,771
|
|
|
100.0
|
%
|
|
$
|
12,378
|
|
|
100.0
|
%
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||
|
Recorded
Investment
|
|
% of
Total
|
|
Recorded
Investment
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Performance indicators
|
|
|
|
|
|
|
|
||||||
Performing
|
$
|
8,696
|
|
|
97.1
|
%
|
|
$
|
6,196
|
|
|
97.3
|
%
|
Nonperforming
|
259
|
|
|
2.9
|
|
|
173
|
|
|
2.7
|
|
||
Total
|
$
|
8,955
|
|
|
100.0
|
%
|
|
$
|
6,369
|
|
|
100.0
|
%
|
|
Past Due
|
|
Nonaccrual Status
|
||||||||||||
|
September 30, 2015
|
|
December 31, 2014
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||
|
(In millions)
|
||||||||||||||
Commercial
|
$
|
9
|
|
|
$
|
10
|
|
|
$
|
7
|
|
|
$
|
75
|
|
Agricultural
|
109
|
|
|
1
|
|
|
46
|
|
|
41
|
|
||||
Residential
|
259
|
|
|
173
|
|
|
248
|
|
|
163
|
|
||||
Total
|
$
|
377
|
|
|
$
|
184
|
|
|
$
|
301
|
|
|
$
|
279
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Fixed maturity securities
|
$
|
22,105
|
|
|
$
|
30,367
|
|
Fixed maturity securities with noncredit OTTI losses in AOCI
|
(99
|
)
|
|
(112
|
)
|
||
Total fixed maturity securities
|
22,006
|
|
|
30,255
|
|
||
Equity securities
|
372
|
|
|
608
|
|
||
Derivatives
|
2,145
|
|
|
1,761
|
|
||
Other
|
287
|
|
|
149
|
|
||
Subtotal
|
24,810
|
|
|
32,773
|
|
||
Amounts allocated from:
|
|
|
|
||||
Future policy benefits
|
(183
|
)
|
|
(2,886
|
)
|
||
DAC and VOBA related to noncredit OTTI losses recognized in AOCI
|
—
|
|
|
(4
|
)
|
||
DAC, VOBA and DSI
|
(1,456
|
)
|
|
(1,946
|
)
|
||
Policyholder dividend obligation
|
(2,309
|
)
|
|
(3,155
|
)
|
||
Subtotal
|
(3,948
|
)
|
|
(7,991
|
)
|
||
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI
|
26
|
|
|
42
|
|
||
Deferred income tax benefit (expense)
|
(7,210
|
)
|
|
(8,556
|
)
|
||
Net unrealized investment gains (losses)
|
13,678
|
|
|
16,268
|
|
||
Net unrealized investment gains (losses) attributable to noncontrolling interests
|
(44
|
)
|
|
(33
|
)
|
||
Net unrealized investment gains (losses) attributable to MetLife, Inc.
|
$
|
13,634
|
|
|
$
|
16,235
|
|
|
Nine Months
Ended September 30, 2015 |
|
Year
Ended December 31, 2014 |
||||
|
(In millions)
|
||||||
Balance, beginning of period
|
$
|
(112
|
)
|
|
$
|
(218
|
)
|
Noncredit OTTI losses and subsequent changes recognized
|
(4
|
)
|
|
17
|
|
||
Securities sold with previous noncredit OTTI loss
|
107
|
|
|
53
|
|
||
Subsequent changes in estimated fair value
|
(90
|
)
|
|
36
|
|
||
Balance, end of period
|
$
|
(99
|
)
|
|
$
|
(112
|
)
|
|
Nine Months
Ended September 30, 2015 |
||
|
(In millions)
|
||
Balance, beginning of period
|
$
|
16,235
|
|
Fixed maturity securities on which noncredit OTTI losses have been recognized
|
13
|
|
|
Unrealized investment gains (losses) during the period
|
(7,976
|
)
|
|
Unrealized investment gains (losses) relating to:
|
|
||
Future policy benefits
|
2,703
|
|
|
DAC and VOBA related to noncredit OTTI losses recognized in AOCI
|
4
|
|
|
DAC, VOBA and DSI
|
490
|
|
|
Policyholder dividend obligation
|
846
|
|
|
Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI
|
(16
|
)
|
|
Deferred income tax benefit (expense)
|
1,346
|
|
|
Net unrealized investment gains (losses)
|
13,645
|
|
|
Net unrealized investment gains (losses) attributable to noncontrolling interests
|
(11
|
)
|
|
Balance, end of period
|
$
|
13,634
|
|
Change in net unrealized investment gains (losses)
|
$
|
(2,590
|
)
|
Change in net unrealized investment gains (losses) attributable to noncontrolling interests
|
(11
|
)
|
|
Change in net unrealized investment gains (losses) attributable to MetLife, Inc.
|
$
|
(2,601
|
)
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Securities on loan: (1)
|
|
|
|
||||
Amortized cost
|
$
|
27,147
|
|
|
$
|
26,989
|
|
Estimated fair value
|
$
|
29,848
|
|
|
$
|
30,269
|
|
Cash collateral on deposit from counterparties (2)
|
$
|
30,384
|
|
|
$
|
30,826
|
|
Security collateral on deposit from counterparties (3)
|
$
|
175
|
|
|
$
|
83
|
|
Reinvestment portfolio — estimated fair value
|
$
|
30,560
|
|
|
$
|
31,314
|
|
(1)
|
Included within fixed maturity securities and short-term investments. At
September 30, 2015
, both amortized cost and estimated fair value also include
$227 million
, at estimated fair value, of securities which are not reflected in the consolidated financial statements.
|
(2)
|
Included within payables for collateral under securities loaned and other transactions.
|
(3)
|
Security collateral on deposit from counterparties may not be sold or re-pledged, unless the counterparty is in default, and is not reflected in the consolidated financial statements.
|
|
September 30, 2015
|
|||||||||||||||||||||
|
Remaining Tenor of Securities Lending Agreements
|
|
|
|
|
|||||||||||||||||
|
Open (1)
|
|
1 Month or Less
|
|
1 to 6 Months
|
|
6 Months to 1 Year
|
|
Total
|
|
% of Total
|
|||||||||||
|
(In millions)
|
|
|
|||||||||||||||||||
Cash collateral liability by loaned security type
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
U.S. Treasury and agency
|
$
|
10,199
|
|
|
$
|
11,215
|
|
|
$
|
5,398
|
|
|
$
|
435
|
|
|
$
|
27,247
|
|
|
89.7
|
%
|
Agency RMBS
|
—
|
|
|
986
|
|
|
658
|
|
|
—
|
|
|
1,644
|
|
|
5.4
|
|
|||||
Foreign government
|
2
|
|
|
979
|
|
|
216
|
|
|
—
|
|
|
1,197
|
|
|
3.9
|
|
|||||
U.S. corporate
|
10
|
|
|
285
|
|
|
—
|
|
|
—
|
|
|
295
|
|
|
1.0
|
|
|||||
Foreign corporate
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|||||
Total
|
$
|
10,212
|
|
|
$
|
13,465
|
|
|
$
|
6,272
|
|
|
$
|
435
|
|
|
$
|
30,384
|
|
|
100.0
|
%
|
|
December 31, 2014
|
|||||||||||||||||||||
|
Remaining Tenor of Securities Lending Agreements
|
|
|
|
|
|||||||||||||||||
|
Open (1)
|
|
1 Month or Less
|
|
1 to 6 Months
|
|
6 Months to 1 Year
|
|
Total
|
|
% of Total
|
|||||||||||
|
(In millions)
|
|
|
|||||||||||||||||||
Cash collateral liability by loaned security type
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
U.S. Treasury and agency
|
$
|
10,371
|
|
|
$
|
10,423
|
|
|
$
|
5,239
|
|
|
$
|
—
|
|
|
$
|
26,033
|
|
|
84.5
|
%
|
Agency RMBS
|
—
|
|
|
482
|
|
|
2,572
|
|
|
—
|
|
|
3,054
|
|
|
9.9
|
|
|||||
Foreign government
|
30
|
|
|
1,034
|
|
|
81
|
|
|
—
|
|
|
1,145
|
|
|
3.7
|
|
|||||
U.S. corporate
|
125
|
|
|
182
|
|
|
—
|
|
|
—
|
|
|
307
|
|
|
1.0
|
|
|||||
Foreign corporate
|
175
|
|
|
112
|
|
|
—
|
|
|
—
|
|
|
287
|
|
|
0.9
|
|
|||||
Total
|
$
|
10,701
|
|
|
$
|
12,233
|
|
|
$
|
7,892
|
|
|
$
|
—
|
|
|
$
|
30,826
|
|
|
100.0
|
%
|
(1)
|
The related loaned security could be returned to the Company on the next business day which would require the Company to immediately return the cash collateral.
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Invested assets on deposit (regulatory deposits)
|
$
|
9,146
|
|
|
$
|
9,437
|
|
Invested assets held in trust (collateral financing arrangements and reinsurance agreements)
|
10,285
|
|
|
10,069
|
|
||
Invested assets pledged as collateral (1)
|
24,646
|
|
|
25,996
|
|
||
Total invested assets on deposit, held in trust and pledged as collateral
|
$
|
44,077
|
|
|
$
|
45,502
|
|
(1)
|
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
2014
Annual Report), collateral financing arrangements (see Note 13 of the Notes to the Consolidated Financial Statements included in the
2014
Annual Report) and derivative transactions (see
Note 6
).
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||
|
Total
Assets
|
|
Total
Liabilities
|
|
Total
Assets
|
|
Total
Liabilities
|
||||||||
|
(In millions)
|
||||||||||||||
MRSC (collateral financing arrangement (primarily securities)) (1)
|
$
|
3,399
|
|
|
$
|
—
|
|
|
$
|
3,471
|
|
|
$
|
—
|
|
Operating joint venture (2)
|
2,445
|
|
|
2,045
|
|
|
2,405
|
|
|
1,999
|
|
||||
CSEs (assets (primarily loans) and liabilities (primarily debt)) (3)
|
219
|
|
|
74
|
|
|
297
|
|
|
155
|
|
||||
Investments:
|
|
|
|
|
|
|
|
||||||||
Mortgage loans
|
86
|
|
|
86
|
|
|
—
|
|
|
—
|
|
||||
Other invested assets
|
46
|
|
|
—
|
|
|
59
|
|
|
—
|
|
||||
FVO and trading securities
|
—
|
|
|
—
|
|
|
45
|
|
|
—
|
|
||||
Other limited partnership interests
|
29
|
|
|
—
|
|
|
37
|
|
|
—
|
|
||||
Real estate joint ventures
|
—
|
|
|
—
|
|
|
9
|
|
|
15
|
|
||||
Total
|
$
|
6,224
|
|
|
$
|
2,205
|
|
|
$
|
6,323
|
|
|
$
|
2,169
|
|
(1)
|
See Note 13 of the Notes to the Consolidated Financial Statements included in the
2014
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
$126 million
and
$123 million
at estimated fair value at
September 30, 2015
and
December 31, 2014
, 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
$8 million
and
$10 million
for the
three months
and
nine months ended
September 30, 2015
, respectively, and
$3 million
and
$34 million
for the
three months
and
nine months ended
September 30, 2014
, respectively.
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||
|
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)
|
$
|
66,544
|
|
|
$
|
66,544
|
|
|
$
|
68,427
|
|
|
$
|
68,427
|
|
U.S. and foreign corporate
|
3,324
|
|
|
3,324
|
|
|
3,829
|
|
|
3,829
|
|
||||
Other limited partnership interests
|
6,004
|
|
|
8,162
|
|
|
6,250
|
|
|
8,402
|
|
||||
Other invested assets
|
1,587
|
|
|
2,007
|
|
|
1,720
|
|
|
2,050
|
|
||||
FVO and trading securities
|
577
|
|
|
577
|
|
|
565
|
|
|
565
|
|
||||
Real estate joint ventures
|
72
|
|
|
90
|
|
|
100
|
|
|
125
|
|
||||
Mortgage loans
|
34
|
|
|
34
|
|
|
51
|
|
|
51
|
|
||||
Equity securities AFS:
|
|
|
|
|
|
|
|
||||||||
Non-redeemable preferred stock
|
39
|
|
|
39
|
|
|
41
|
|
|
41
|
|
||||
Total
|
$
|
78,181
|
|
|
$
|
80,777
|
|
|
$
|
80,983
|
|
|
$
|
83,490
|
|
(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. 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
$188 million
and
$212 million
at
September 30, 2015
and
December 31, 2014
, 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 September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Investment income:
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities
|
$
|
3,525
|
|
|
$
|
3,695
|
|
|
$
|
10,738
|
|
|
$
|
11,106
|
|
Equity securities
|
36
|
|
|
31
|
|
|
102
|
|
|
98
|
|
||||
FVO and trading securities — Actively Traded and FVO general account securities (1)
|
(35
|
)
|
|
14
|
|
|
4
|
|
|
95
|
|
||||
Mortgage loans
|
786
|
|
|
775
|
|
|
2,317
|
|
|
2,192
|
|
||||
Policy loans
|
147
|
|
|
158
|
|
|
450
|
|
|
473
|
|
||||
Real estate and real estate joint ventures
|
233
|
|
|
245
|
|
|
767
|
|
|
724
|
|
||||
Other limited partnership interests
|
216
|
|
|
299
|
|
|
681
|
|
|
834
|
|
||||
Cash, cash equivalents and short-term investments
|
29
|
|
|
42
|
|
|
101
|
|
|
130
|
|
||||
Operating joint ventures
|
(1
|
)
|
|
2
|
|
|
15
|
|
|
5
|
|
||||
Other
|
28
|
|
|
60
|
|
|
180
|
|
|
136
|
|
||||
Subtotal
|
4,964
|
|
|
5,321
|
|
|
15,355
|
|
|
15,793
|
|
||||
Less: Investment expenses
|
308
|
|
|
298
|
|
|
923
|
|
|
873
|
|
||||
Subtotal, net
|
4,656
|
|
|
5,023
|
|
|
14,432
|
|
|
14,920
|
|
||||
FVO and trading securities — FVO contractholder-directed unit-linked investments (1)
|
(701
|
)
|
|
379
|
|
|
(79
|
)
|
|
739
|
|
||||
FVO CSEs — interest income:
|
|
|
|
|
|
|
|
||||||||
Commercial mortgage loans
|
4
|
|
|
8
|
|
|
13
|
|
|
44
|
|
||||
Securities
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Subtotal
|
(697
|
)
|
|
387
|
|
|
(65
|
)
|
|
784
|
|
||||
Net investment income
|
$
|
3,959
|
|
|
$
|
5,410
|
|
|
$
|
14,367
|
|
|
$
|
15,704
|
|
(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 September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Actively Traded and FVO general account securities
|
$
|
(39
|
)
|
|
$
|
(18
|
)
|
|
$
|
(45
|
)
|
|
$
|
7
|
|
FVO contractholder-directed unit-linked investments
|
$
|
(833
|
)
|
|
$
|
248
|
|
|
$
|
(600
|
)
|
|
$
|
329
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Total gains (losses) on fixed maturity securities:
|
|
|
|
|
|
|
|
||||||||
Total OTTI losses recognized — by sector and industry:
|
|
|
|
|
|
|
|
||||||||
U.S. and foreign corporate securities — by industry:
|
|
|
|
|
|
|
|
||||||||
Consumer
|
$
|
(17
|
)
|
|
$
|
—
|
|
|
$
|
(20
|
)
|
|
$
|
(7
|
)
|
Transportation
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||
Industrial
|
(3
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
||||
Total U.S. and foreign corporate securities
|
(20
|
)
|
|
—
|
|
|
(25
|
)
|
|
(9
|
)
|
||||
RMBS
|
(1
|
)
|
|
(18
|
)
|
|
(16
|
)
|
|
(27
|
)
|
||||
ABS
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
||||
CMBS
|
—
|
|
|
(13
|
)
|
|
—
|
|
|
(13
|
)
|
||||
State and political subdivision
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
||||
OTTI losses on fixed maturity securities recognized in earnings
|
(27
|
)
|
|
(31
|
)
|
|
(47
|
)
|
|
(56
|
)
|
||||
Fixed maturity securities — net gains (losses) on sales and disposals
|
115
|
|
|
184
|
|
|
383
|
|
|
349
|
|
||||
Total gains (losses) on fixed maturity securities
|
88
|
|
|
153
|
|
|
336
|
|
|
293
|
|
||||
Total gains (losses) on equity securities:
|
|
|
|
|
|
|
|
||||||||
Total OTTI losses recognized — by sector:
|
|
|
|
|
|
|
|
||||||||
Non-redeemable preferred stock
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(23
|
)
|
||||
Common stock
|
(6
|
)
|
|
(1
|
)
|
|
(15
|
)
|
|
(12
|
)
|
||||
OTTI losses on equity securities recognized in earnings
|
(7
|
)
|
|
(1
|
)
|
|
(16
|
)
|
|
(35
|
)
|
||||
Equity securities — net gains (losses) on sales and disposals
|
14
|
|
|
15
|
|
|
39
|
|
|
99
|
|
||||
Total gains (losses) on equity securities
|
7
|
|
|
14
|
|
|
23
|
|
|
64
|
|
||||
FVO and trading securities — FVO general account securities
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
||||
Mortgage loans
|
(26
|
)
|
|
(30
|
)
|
|
(78
|
)
|
|
(25
|
)
|
||||
Real estate and real estate joint ventures
|
263
|
|
|
86
|
|
|
257
|
|
|
150
|
|
||||
Other limited partnership interests
|
(59
|
)
|
|
(14
|
)
|
|
(52
|
)
|
|
(52
|
)
|
||||
Other investment portfolio gains (losses)
|
18
|
|
|
(20
|
)
|
|
14
|
|
|
(26
|
)
|
||||
Subtotal — investment portfolio gains (losses)
|
291
|
|
|
189
|
|
|
500
|
|
|
412
|
|
||||
FVO CSEs:
|
|
|
|
|
|
|
|
||||||||
Commercial mortgage loans
|
(4
|
)
|
|
1
|
|
|
(6
|
)
|
|
(14
|
)
|
||||
Long-term debt — related to commercial mortgage loans
|
1
|
|
|
3
|
|
|
3
|
|
|
21
|
|
||||
Long-term debt — related to securities
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
||||
Non-investment portfolio gains (losses) (1)
|
94
|
|
|
(83
|
)
|
|
38
|
|
|
(845
|
)
|
||||
Subtotal FVO CSEs and non-investment portfolio gains (losses)
|
91
|
|
|
(80
|
)
|
|
35
|
|
|
(839
|
)
|
||||
Total net investment gains (losses)
|
$
|
382
|
|
|
$
|
109
|
|
|
$
|
535
|
|
|
$
|
(427
|
)
|
(1)
|
There were
no
non-investment portfolio gains (losses) for the
three months ended
September 30, 2014
related to the disposition of MetLife Assurance Limited (“MAL”). Non-investment portfolio gains (losses) for the
nine months ended
September 30, 2014
includes a loss of
$633 million
related to the disposition of MAL. See Note 3 of the Notes to the Consolidated Financial Statements included in the 2014 Annual Report.
|
|
Three Months
Ended September 30, |
||||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
Fixed Maturity Securities
|
|
Equity Securities
|
||||||||||||
|
(In millions)
|
||||||||||||||
Proceeds
|
$
|
27,264
|
|
|
$
|
20,105
|
|
|
$
|
55
|
|
|
$
|
96
|
|
Gross investment gains
|
$
|
371
|
|
|
$
|
297
|
|
|
$
|
20
|
|
|
$
|
21
|
|
Gross investment losses
|
(256
|
)
|
|
(113
|
)
|
|
(6
|
)
|
|
(6
|
)
|
||||
OTTI losses
|
(27
|
)
|
|
(31
|
)
|
|
(7
|
)
|
|
(1
|
)
|
||||
Net investment gains (losses)
|
$
|
88
|
|
|
$
|
153
|
|
|
$
|
7
|
|
|
$
|
14
|
|
|
Nine Months
Ended September 30, |
||||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
Fixed Maturity Securities
|
|
Equity Securities
|
||||||||||||
|
(In millions)
|
||||||||||||||
Proceeds
|
$
|
86,590
|
|
|
$
|
62,096
|
|
|
$
|
211
|
|
|
$
|
523
|
|
Gross investment gains
|
$
|
1,047
|
|
|
$
|
787
|
|
|
$
|
54
|
|
|
$
|
108
|
|
Gross investment losses
|
(664
|
)
|
|
(438
|
)
|
|
(15
|
)
|
|
(9
|
)
|
||||
OTTI losses
|
(47
|
)
|
|
(56
|
)
|
|
(16
|
)
|
|
(35
|
)
|
||||
Net investment gains (losses)
|
$
|
336
|
|
|
$
|
293
|
|
|
$
|
23
|
|
|
$
|
64
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Balance, beginning of period
|
$
|
280
|
|
|
$
|
359
|
|
|
$
|
357
|
|
|
$
|
378
|
|
Additions:
|
|
|
|
|
|
|
|
||||||||
Initial impairments — credit loss OTTI on securities not previously impaired
|
—
|
|
|
1
|
|
|
2
|
|
|
1
|
|
||||
Additional impairments — credit loss OTTI on securities previously impaired
|
1
|
|
|
15
|
|
|
14
|
|
|
23
|
|
||||
Reductions:
|
|
|
|
|
|
|
|
||||||||
Sales (maturities, pay downs or prepayments) of securities previously impaired as credit loss OTTI
|
(22
|
)
|
|
(11
|
)
|
|
(113
|
)
|
|
(31
|
)
|
||||
Securities impaired to net present value of expected future cash flows
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
||||
Increase in cash flows — accretion of previous credit loss OTTI
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
||||
Balance, end of period
|
$
|
258
|
|
|
$
|
364
|
|
|
$
|
258
|
|
|
$
|
364
|
|
Statement of Operations Presentation:
|
Derivative:
|
|
Policyholder benefits and claims
|
•
|
Economic hedges of variable annuity guarantees included in future policy benefits
|
Net investment income
|
•
|
Economic hedges of equity method investments in joint ventures
|
|
•
|
All derivatives held in relation to trading portfolios
|
|
•
|
Derivatives held within contractholder-directed unit-linked investments
|
•
|
Fair value hedge (a hedge of the estimated fair value of a recognized asset or liability) - in net derivative gains (losses), consistent with the change in estimated fair value of the hedged item attributable to the designated risk being hedged.
|
•
|
Cash flow hedge (a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability) - effectiveness in OCI (deferred gains or losses on the derivative are reclassified into the statement of operations when the Company’s earnings are affected by the variability in cash flows of the hedged item); ineffectiveness in net derivative gains (losses).
|
•
|
Net investment in a foreign operation hedge - effectiveness in OCI, consistent with the translation adjustment for the hedged net investment in the foreign operation; ineffectiveness in net derivative gains (losses).
|
•
|
the combined instrument is not accounted for in its entirety at estimated fair value with changes in estimated fair value recorded in earnings;
|
•
|
the terms of the embedded derivative are not clearly and closely related to the economic characteristics of the host contract; and
|
•
|
a separate instrument with the same terms as the embedded derivative would qualify as a derivative instrument.
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Derivatives and hedging gains (losses) (1)
|
$
|
2,318
|
|
|
$
|
543
|
|
|
$
|
1,433
|
|
|
$
|
1,077
|
|
Embedded derivatives gains (losses)
|
(1,833
|
)
|
|
(65
|
)
|
|
(1,039
|
)
|
|
55
|
|
||||
Total net derivative gains (losses)
|
$
|
485
|
|
|
$
|
478
|
|
|
$
|
394
|
|
|
$
|
1,132
|
|
(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 September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Qualifying hedges:
|
|
|
|
|
|
|
|
||||||||
Net investment income
|
$
|
55
|
|
|
$
|
44
|
|
|
$
|
158
|
|
|
$
|
111
|
|
Interest credited to policyholder account balances
|
6
|
|
|
24
|
|
|
21
|
|
|
88
|
|
||||
Other expenses
|
(2
|
)
|
|
(1
|
)
|
|
(4
|
)
|
|
(2
|
)
|
||||
Non-qualifying hedges:
|
|
|
|
|
|
|
|
||||||||
Net investment income
|
(1
|
)
|
|
(1
|
)
|
|
(3
|
)
|
|
(3
|
)
|
||||
Net derivative gains (losses)
|
256
|
|
|
282
|
|
|
757
|
|
|
650
|
|
||||
Policyholder benefits and claims
|
4
|
|
|
74
|
|
|
12
|
|
|
10
|
|
||||
Total
|
$
|
318
|
|
|
$
|
422
|
|
|
$
|
941
|
|
|
$
|
854
|
|
|
Net
Derivative
Gains (Losses)
|
|
Net
Investment
Income (1)
|
|
Policyholder
Benefits and
Claims (2)
|
||||||
|
(In millions)
|
||||||||||
Three Months Ended September 30, 2015
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
1,157
|
|
|
$
|
—
|
|
|
$
|
17
|
|
Foreign currency exchange rate derivatives
|
364
|
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
16
|
|
|
3
|
|
|
—
|
|
|||
Credit derivatives — written
|
(77
|
)
|
|
(1
|
)
|
|
—
|
|
|||
Equity derivatives
|
747
|
|
|
(1
|
)
|
|
340
|
|
|||
Total
|
$
|
2,207
|
|
|
$
|
1
|
|
|
$
|
357
|
|
Three Months Ended September 30, 2014
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
3
|
|
Foreign currency exchange rate derivatives
|
211
|
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
5
|
|
|
1
|
|
|
—
|
|
|||
Credit derivatives — written
|
(32
|
)
|
|
—
|
|
|
—
|
|
|||
Equity derivatives
|
160
|
|
|
(1
|
)
|
|
12
|
|
|||
Total
|
$
|
357
|
|
|
$
|
—
|
|
|
$
|
15
|
|
Nine Months Ended September 30, 2015
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
250
|
|
|
$
|
—
|
|
|
$
|
10
|
|
Foreign currency exchange rate derivatives
|
443
|
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
9
|
|
|
3
|
|
|
—
|
|
|||
Credit derivatives — written
|
(108
|
)
|
|
—
|
|
|
—
|
|
|||
Equity derivatives
|
99
|
|
|
(8
|
)
|
|
214
|
|
|||
Total
|
$
|
693
|
|
|
$
|
(5
|
)
|
|
$
|
224
|
|
Nine Months Ended September 30, 2014
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
616
|
|
|
$
|
—
|
|
|
$
|
25
|
|
Foreign currency exchange rate derivatives
|
199
|
|
|
—
|
|
|
—
|
|
|||
Credit derivatives — purchased
|
(1
|
)
|
|
1
|
|
|
—
|
|
|||
Credit derivatives — written
|
(19
|
)
|
|
—
|
|
|
—
|
|
|||
Equity derivatives
|
(446
|
)
|
|
(13
|
)
|
|
(145
|
)
|
|||
Total
|
$
|
349
|
|
|
$
|
(12
|
)
|
|
$
|
(120
|
)
|
(1)
|
Changes in estimated fair value related to economic hedges of equity method investments in joint ventures, derivatives held in relation to trading portfolios and 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 September 30, 2015
|
|
|
||||||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
(4
|
)
|
|
$
|
3
|
|
|
$
|
(1
|
)
|
|
|
Policyholder liabilities (1)
|
|
289
|
|
|
(290
|
)
|
|
(1
|
)
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
6
|
|
|
(3
|
)
|
|
3
|
|
|||
|
|
Foreign-denominated policyholder account balances (2)
|
|
(47
|
)
|
|
46
|
|
|
(1
|
)
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
49
|
|
|
(45
|
)
|
|
4
|
|
|||
Total
|
|
$
|
293
|
|
|
$
|
(289
|
)
|
|
$
|
4
|
|
||
Three Months Ended September 30, 2014
|
|
|
|
|
|
|
||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
9
|
|
|
$
|
(8
|
)
|
|
$
|
1
|
|
|
|
Policyholder liabilities (1)
|
|
43
|
|
|
(44
|
)
|
|
(1
|
)
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
12
|
|
|
(12
|
)
|
|
—
|
|
|||
|
|
Foreign-denominated policyholder account balances (2)
|
|
(134
|
)
|
|
129
|
|
|
(5
|
)
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
(49
|
)
|
|
45
|
|
|
(4
|
)
|
|||
Total
|
|
$
|
(119
|
)
|
|
$
|
110
|
|
|
$
|
(9
|
)
|
||
Nine Months Ended September 30, 2015
|
|
|
||||||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
(5
|
)
|
|
$
|
8
|
|
|
$
|
3
|
|
|
|
Policyholder liabilities (1)
|
|
120
|
|
|
(126
|
)
|
|
(6
|
)
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
13
|
|
|
(6
|
)
|
|
7
|
|
|||
|
|
Foreign-denominated policyholder account balances (2)
|
|
(186
|
)
|
|
179
|
|
|
(7
|
)
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
(49
|
)
|
|
45
|
|
|
(4
|
)
|
|||
Total
|
|
$
|
(107
|
)
|
|
$
|
100
|
|
|
$
|
(7
|
)
|
||
Nine Months Ended September 30, 2014
|
|
|
|
|
|
|
||||||||
Interest rate swaps:
|
|
Fixed maturity securities
|
|
$
|
7
|
|
|
$
|
(5
|
)
|
|
$
|
2
|
|
|
|
Policyholder liabilities (1)
|
|
389
|
|
|
(379
|
)
|
|
10
|
|
|||
Foreign currency swaps:
|
|
Foreign-denominated fixed maturity securities
|
|
5
|
|
|
(5
|
)
|
|
—
|
|
|||
|
|
Foreign-denominated policyholder account balances (2)
|
|
(160
|
)
|
|
158
|
|
|
(2
|
)
|
|||
Foreign currency forwards:
|
|
Foreign-denominated fixed maturity securities
|
|
(33
|
)
|
|
31
|
|
|
(2
|
)
|
|||
Total
|
|
$
|
208
|
|
|
$
|
(200
|
)
|
|
$
|
8
|
|
(1)
|
Fixed rate liabilities reported in policyholder account balances 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 September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
211
|
|
|
$
|
40
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Interest rate forwards
|
|
7
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|||||
Foreign currency swaps
|
|
(116
|
)
|
|
(286
|
)
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Credit forwards
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
102
|
|
|
$
|
(244
|
)
|
|
$
|
4
|
|
|
$
|
1
|
|
|
$
|
5
|
|
Three Months Ended September 30, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
96
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
6
|
|
Interest rate forwards
|
|
9
|
|
|
(10
|
)
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|||||
Foreign currency swaps
|
|
13
|
|
|
(466
|
)
|
|
(1
|
)
|
|
—
|
|
|
2
|
|
|||||
Credit forwards
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
118
|
|
|
$
|
(475
|
)
|
|
$
|
3
|
|
|
$
|
1
|
|
|
$
|
7
|
|
Nine Months Ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
116
|
|
|
$
|
52
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
3
|
|
Interest rate forwards
|
|
2
|
|
|
5
|
|
|
3
|
|
|
2
|
|
|
—
|
|
|||||
Foreign currency swaps
|
|
(224
|
)
|
|
(563
|
)
|
|
(1
|
)
|
|
1
|
|
|
6
|
|
|||||
Credit forwards
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
(106
|
)
|
|
$
|
(505
|
)
|
|
$
|
12
|
|
|
$
|
3
|
|
|
$
|
9
|
|
Nine Months Ended September 30, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
$
|
458
|
|
|
$
|
28
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
6
|
|
Interest rate forwards
|
|
61
|
|
|
(8
|
)
|
|
2
|
|
|
2
|
|
|
—
|
|
|||||
Foreign currency swaps
|
|
95
|
|
|
(368
|
)
|
|
(2
|
)
|
|
1
|
|
|
1
|
|
|||||
Credit forwards
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
614
|
|
|
$
|
(348
|
)
|
|
$
|
8
|
|
|
$
|
3
|
|
|
$
|
7
|
|
Derivatives in Net Investment Hedging Relationships (1), (2)
|
|
Amount of Gains (Losses) Deferred in AOCI
(Effective Portion)
|
||
|
|
(In millions)
|
||
Three Months Ended September 30, 2015
|
|
|
||
Foreign currency forwards
|
|
$
|
88
|
|
Currency options
|
|
(18
|
)
|
|
Total
|
|
$
|
70
|
|
Three Months Ended September 30, 2014
|
|
|
||
Foreign currency forwards
|
|
$
|
227
|
|
Currency options
|
|
163
|
|
|
Total
|
|
$
|
390
|
|
Nine Months Ended September 30, 2015
|
|
|
||
Foreign currency forwards
|
|
$
|
244
|
|
Currency options
|
|
(61
|
)
|
|
Total
|
|
$
|
183
|
|
Nine Months Ended September 30, 2014
|
|
|
||
Foreign currency forwards
|
|
$
|
148
|
|
Currency options
|
|
(75
|
)
|
|
Total
|
|
$
|
73
|
|
(1)
|
During both the
three months
and
nine months ended
September 30, 2015
, 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. In May 2014, the Company sold its interest in MAL (see Note 3 of the Notes to the Consolidated Financial Statements included in the 2014 Annual Report), which was a hedged item in a net investment hedging relationship. As a result, during the
nine months ended
September 30, 2014
, the Company released losses of
$77 million
from AOCI into earnings upon the sale. During the
three months ended
September 30, 2014
, 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.
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||
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)
|
|
$
|
7
|
|
|
$
|
690
|
|
|
2.5
|
|
|
$
|
10
|
|
|
$
|
677
|
|
|
2.4
|
|
Credit default swaps referencing indices
|
|
2
|
|
|
1,610
|
|
|
3.2
|
|
|
10
|
|
|
1,700
|
|
|
2.6
|
|
||||
Subtotal
|
|
9
|
|
|
2,300
|
|
|
3.0
|
|
|
20
|
|
|
2,377
|
|
|
2.6
|
|
||||
Baa
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Single name credit default swaps (corporate)
|
|
12
|
|
|
1,434
|
|
|
2.7
|
|
|
23
|
|
|
1,591
|
|
|
2.8
|
|
||||
Credit default swaps referencing indices
|
|
26
|
|
|
5,939
|
|
|
5.0
|
|
|
94
|
|
|
5,774
|
|
|
4.7
|
|
||||
Subtotal
|
|
38
|
|
|
7,373
|
|
|
4.5
|
|
|
117
|
|
|
7,365
|
|
|
4.3
|
|
||||
Ba
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Single name credit default swaps (corporate)
|
|
1
|
|
|
60
|
|
|
2.2
|
|
|
—
|
|
|
60
|
|
|
3.0
|
|
||||
Credit default swaps referencing indices
|
|
(1
|
)
|
|
100
|
|
|
1.2
|
|
|
(1
|
)
|
|
100
|
|
|
2.0
|
|
||||
Subtotal
|
|
—
|
|
|
160
|
|
|
1.6
|
|
|
(1
|
)
|
|
160
|
|
|
2.4
|
|
||||
B
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Single name credit default swaps (corporate)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Credit default swaps referencing indices
|
|
—
|
|
|
625
|
|
|
5.1
|
|
|
39
|
|
|
625
|
|
|
4.9
|
|
||||
Subtotal
|
|
—
|
|
|
625
|
|
|
5.1
|
|
|
39
|
|
|
625
|
|
|
4.9
|
|
||||
Total
|
|
$
|
47
|
|
|
$
|
10,458
|
|
|
4.2
|
|
|
$
|
175
|
|
|
$
|
10,527
|
|
|
3.9
|
|
(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 gross notional amounts.
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||
Derivatives Subject to a Master Netting Arrangement or a Similar Arrangement (6)
|
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||
|
|
(In millions)
|
||||||||||||||
Gross estimated fair value of derivatives:
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral (1)
|
|
$
|
14,245
|
|
|
$
|
6,008
|
|
|
$
|
12,256
|
|
|
$
|
6,017
|
|
OTC-cleared (1)
|
|
1,470
|
|
|
1,295
|
|
|
1,380
|
|
|
1,054
|
|
||||
Exchange-traded
|
|
27
|
|
|
92
|
|
|
71
|
|
|
11
|
|
||||
Total gross estimated fair value of derivatives (1)
|
|
15,742
|
|
|
7,395
|
|
|
13,707
|
|
|
7,082
|
|
||||
Amounts offset on the consolidated balance sheets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Estimated fair value of derivatives presented on the consolidated balance sheets (1)
|
|
15,742
|
|
|
7,395
|
|
|
13,707
|
|
|
7,082
|
|
||||
Gross amounts not offset on the consolidated balance sheets:
|
|
|
|
|
|
|
|
|
||||||||
Gross estimated fair value of derivatives: (2)
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral
|
|
(4,682
|
)
|
|
(4,682
|
)
|
|
(4,082
|
)
|
|
(4,082
|
)
|
||||
OTC-cleared
|
|
(1,225
|
)
|
|
(1,225
|
)
|
|
(989
|
)
|
|
(989
|
)
|
||||
Exchange-traded
|
|
(2
|
)
|
|
(2
|
)
|
|
(5
|
)
|
|
(5
|
)
|
||||
Cash collateral: (3), (4)
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral
|
|
(7,151
|
)
|
|
(4
|
)
|
|
(4,153
|
)
|
|
(133
|
)
|
||||
OTC-cleared
|
|
(244
|
)
|
|
(63
|
)
|
|
(386
|
)
|
|
(62
|
)
|
||||
Exchange-traded
|
|
—
|
|
|
(44
|
)
|
|
—
|
|
|
(4
|
)
|
||||
Securities collateral: (5)
|
|
|
|
|
|
|
|
|
||||||||
OTC-bilateral
|
|
(2,039
|
)
|
|
(1,240
|
)
|
|
(3,768
|
)
|
|
(1,700
|
)
|
||||
OTC-cleared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||
Exchange-traded
|
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Net amount after application of master netting agreements and collateral
|
|
$
|
399
|
|
|
$
|
89
|
|
|
$
|
324
|
|
|
$
|
102
|
|
(1)
|
At
September 30, 2015
and
December 31, 2014
, derivative assets included income or expense accruals reported in accrued investment income or in other liabilities of
$227 million
and
$255 million
, respectively, and derivative liabilities included income or expense accruals reported in accrued investment income or in other liabilities of
$41 million
and
$60 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 by the Company for OTC-bilateral and OTC-cleared derivatives 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. In certain instances, cash collateral pledged to the Company as initial margin for OTC-bilateral derivatives is held in separate custodial accounts and is not recorded on the Company’s balance sheet because the account title is in the name of the counterparty (but segregated for the benefit of the Company). The amount of this off-balance sheet collateral was
$0
and
$263 million
at
September 30, 2015
and
December 31, 2014
, respectively.
|
(4)
|
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
September 30, 2015
and
December 31, 2014
, the Company received excess cash collateral of
$76 million
and
$87 million
(including
$0
and
$36 million
off-balance sheet cash collateral held in separate custodial accounts), respectively, and provided excess cash collateral of
$175 million
and
$192 million
, respectively, which is not included in the table above due to the foregoing limitation.
|
(5)
|
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 re-pledge this collateral, but at
September 30, 2015
,
none
of the collateral had been sold or re-pledged. 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 re-pledge 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
September 30, 2015
and
December 31, 2014
, the Company received excess securities collateral with an estimated fair value of
$154 million
and
$395 million
, respectively, for its OTC-bilateral derivatives, which are not included in the table above due to the foregoing limitation. At
September 30, 2015
and
December 31, 2014
, the Company provided excess securities collateral with an estimated fair value of
$145 million
and
$117 million
, respectively, for its OTC-bilateral derivatives, and
$270 million
and
$199 million
, respectively, for its OTC-cleared derivatives, and
$161 million
and
$245 million
, respectively, for its exchange-traded derivatives, which are not included in the table above due to the foregoing limitation.
|
(6)
|
See
Note 5
for information regarding the Company’s gross and net payables and receivables under repurchase agreement transactions.
|
|
|
|
|
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)
|
||||||||||||||||||
September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to credit-contingent provisions
|
|
$
|
1,154
|
|
|
$
|
1,236
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
3
|
|
Derivatives not subject to credit-contingent provisions
|
|
164
|
|
|
149
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
1,318
|
|
|
$
|
1,385
|
|
|
$
|
5
|
|
|
$
|
3
|
|
|
$
|
3
|
|
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives subject to credit-contingent provisions
|
|
$
|
1,832
|
|
|
$
|
1,750
|
|
|
$
|
131
|
|
|
$
|
5
|
|
|
$
|
7
|
|
Derivatives not subject to credit-contingent provisions
|
|
84
|
|
|
65
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
1,916
|
|
|
$
|
1,815
|
|
|
$
|
133
|
|
|
$
|
5
|
|
|
$
|
7
|
|
(1)
|
After taking into consideration the existence of netting agreements.
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Net derivative gains (losses) (1)
|
$
|
(1,833
|
)
|
|
$
|
(65
|
)
|
|
$
|
(1,039
|
)
|
|
$
|
55
|
|
Policyholder benefits and claims
|
$
|
59
|
|
|
$
|
32
|
|
|
$
|
40
|
|
|
$
|
55
|
|
(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
$253 million
and
$222 million
for the
three months
and
nine months ended
September 30, 2015
, respectively, and
$5 million
and
($3) million
for the
three months
and
nine months ended
September 30, 2014
, respectively.
|
|
September 30, 2015
|
||||||||||||||
|
Fair Value Hierarchy
|
|
|
||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total Estimated
Fair Value
|
||||||||
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
||||||||
U.S. corporate
|
$
|
—
|
|
|
$
|
93,922
|
|
|
$
|
7,035
|
|
|
$
|
100,957
|
|
Foreign corporate
|
—
|
|
|
52,737
|
|
|
5,667
|
|
|
58,404
|
|
||||
U.S. Treasury and agency
|
34,085
|
|
|
25,569
|
|
|
17
|
|
|
59,671
|
|
||||
Foreign government
|
—
|
|
|
49,832
|
|
|
691
|
|
|
50,523
|
|
||||
RMBS
|
32
|
|
|
34,538
|
|
|
5,480
|
|
|
40,050
|
|
||||
State and political subdivision
|
—
|
|
|
15,433
|
|
|
46
|
|
|
15,479
|
|
||||
CMBS
|
—
|
|
|
11,515
|
|
|
847
|
|
|
12,362
|
|
||||
ABS
|
—
|
|
|
11,926
|
|
|
2,206
|
|
|
14,132
|
|
||||
Total fixed maturity securities
|
34,117
|
|
|
295,472
|
|
|
21,989
|
|
|
351,578
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
||||||||
Common stock
|
1,347
|
|
|
843
|
|
|
126
|
|
|
2,316
|
|
||||
Non-redeemable preferred stock
|
—
|
|
|
759
|
|
|
324
|
|
|
1,083
|
|
||||
Total equity securities
|
1,347
|
|
|
1,602
|
|
|
450
|
|
|
3,399
|
|
||||
FVO and trading securities:
|
|
|
|
|
|
|
|
||||||||
Actively Traded securities
|
—
|
|
|
656
|
|
|
40
|
|
|
696
|
|
||||
FVO general account securities
|
460
|
|
|
31
|
|
|
91
|
|
|
582
|
|
||||
FVO contractholder-directed unit-linked investments
|
10,665
|
|
|
3,147
|
|
|
257
|
|
|
14,069
|
|
||||
FVO securities held by CSEs
|
—
|
|
|
4
|
|
|
10
|
|
|
14
|
|
||||
Total FVO and trading securities
|
11,125
|
|
|
3,838
|
|
|
398
|
|
|
15,361
|
|
||||
Short-term investments (1)
|
3,634
|
|
|
9,006
|
|
|
1,313
|
|
|
13,953
|
|
||||
Mortgage loans:
|
|
|
|
|
|
|
|
||||||||
Residential mortgage loans — FVO
|
—
|
|
|
—
|
|
|
315
|
|
|
315
|
|
||||
Commercial mortgage loans held by CSEs — FVO
|
—
|
|
|
204
|
|
|
—
|
|
|
204
|
|
||||
Total mortgage loans
|
—
|
|
|
204
|
|
|
315
|
|
|
519
|
|
||||
Other invested assets:
|
|
|
|
|
|
|
|
||||||||
Other investments
|
167
|
|
|
—
|
|
|
—
|
|
|
167
|
|
||||
Derivative assets: (2)
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
3
|
|
|
10,249
|
|
|
26
|
|
|
10,278
|
|
||||
Foreign currency exchange rate
|
1
|
|
|
2,964
|
|
|
26
|
|
|
2,991
|
|
||||
Credit
|
—
|
|
|
79
|
|
|
6
|
|
|
85
|
|
||||
Equity market
|
23
|
|
|
1,753
|
|
|
385
|
|
|
2,161
|
|
||||
Total derivative assets
|
27
|
|
|
15,045
|
|
|
443
|
|
|
15,515
|
|
||||
Total other invested assets
|
194
|
|
|
15,045
|
|
|
443
|
|
|
15,682
|
|
||||
Net embedded derivatives within asset host contracts (3)
|
—
|
|
|
—
|
|
|
409
|
|
|
409
|
|
||||
Separate account assets (4)
|
76,074
|
|
|
221,493
|
|
|
1,682
|
|
|
299,249
|
|
||||
Total assets
|
$
|
126,491
|
|
|
$
|
546,660
|
|
|
$
|
26,999
|
|
|
$
|
700,150
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities: (2)
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
$
|
9
|
|
|
$
|
2,651
|
|
|
$
|
1
|
|
|
$
|
2,661
|
|
Foreign currency exchange rate
|
1
|
|
|
2,788
|
|
|
171
|
|
|
2,960
|
|
||||
Credit
|
—
|
|
|
43
|
|
|
2
|
|
|
45
|
|
||||
Equity market
|
82
|
|
|
898
|
|
|
708
|
|
|
1,688
|
|
||||
Total derivative liabilities
|
92
|
|
|
6,380
|
|
|
882
|
|
|
7,354
|
|
||||
Net embedded derivatives within liability host contracts (3)
|
—
|
|
|
2
|
|
|
1,575
|
|
|
1,577
|
|
||||
Long-term debt of CSEs — FVO
|
—
|
|
|
61
|
|
|
11
|
|
|
72
|
|
||||
Trading liabilities (5)
|
164
|
|
|
34
|
|
|
2
|
|
|
200
|
|
||||
Total liabilities
|
$
|
256
|
|
|
$
|
6,477
|
|
|
$
|
2,470
|
|
|
$
|
9,203
|
|
|
December 31, 2014
|
||||||||||||||
|
Fair Value Hierarchy
|
|
|
||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total Estimated
Fair Value
|
||||||||
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities:
|
|
|
|
|
|
|
|
||||||||
U.S. corporate
|
$
|
—
|
|
|
$
|
99,012
|
|
|
$
|
6,942
|
|
|
$
|
105,954
|
|
Foreign corporate
|
—
|
|
|
55,185
|
|
|
6,490
|
|
|
61,675
|
|
||||
U.S. Treasury and agency
|
36,879
|
|
|
24,637
|
|
|
—
|
|
|
61,516
|
|
||||
Foreign government
|
—
|
|
|
51,355
|
|
|
1,311
|
|
|
52,666
|
|
||||
RMBS
|
—
|
|
|
35,463
|
|
|
4,383
|
|
|
39,846
|
|
||||
State and political subdivision
|
—
|
|
|
15,187
|
|
|
—
|
|
|
15,187
|
|
||||
CMBS
|
—
|
|
|
13,567
|
|
|
765
|
|
|
14,332
|
|
||||
ABS
|
—
|
|
|
12,005
|
|
|
2,244
|
|
|
14,249
|
|
||||
Total fixed maturity securities
|
36,879
|
|
|
306,411
|
|
|
22,135
|
|
|
365,425
|
|
||||
Equity securities:
|
|
|
|
|
|
|
|
||||||||
Common stock
|
1,558
|
|
|
863
|
|
|
95
|
|
|
2,516
|
|
||||
Non-redeemable preferred stock
|
—
|
|
|
865
|
|
|
250
|
|
|
1,115
|
|
||||
Total equity securities
|
1,558
|
|
|
1,728
|
|
|
345
|
|
|
3,631
|
|
||||
FVO and trading securities:
|
|
|
|
|
|
|
|
||||||||
Actively Traded securities
|
22
|
|
|
627
|
|
|
5
|
|
|
654
|
|
||||
FVO general account securities
|
552
|
|
|
57
|
|
|
95
|
|
|
704
|
|
||||
FVO contractholder-directed unit-linked investments
|
11,064
|
|
|
3,797
|
|
|
455
|
|
|
15,316
|
|
||||
FVO securities held by CSEs
|
—
|
|
|
3
|
|
|
12
|
|
|
15
|
|
||||
Total FVO and trading securities
|
11,638
|
|
|
4,484
|
|
|
567
|
|
|
16,689
|
|
||||
Short-term investments (1)
|
2,104
|
|
|
5,223
|
|
|
336
|
|
|
7,663
|
|
||||
Mortgage loans:
|
|
|
|
|
|
|
|
||||||||
Residential mortgage loans — FVO
|
—
|
|
|
—
|
|
|
308
|
|
|
308
|
|
||||
Commercial mortgage loans held by CSEs — FVO
|
—
|
|
|
280
|
|
|
—
|
|
|
280
|
|
||||
Total mortgage loans
|
—
|
|
|
280
|
|
|
308
|
|
|
588
|
|
||||
Other invested assets:
|
|
|
|
|
|
|
|
||||||||
Other investments
|
203
|
|
|
61
|
|
|
—
|
|
|
264
|
|
||||
Derivative assets: (2)
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
4
|
|
|
8,988
|
|
|
63
|
|
|
9,055
|
|
||||
Foreign currency exchange rate
|
2
|
|
|
2,472
|
|
|
25
|
|
|
2,499
|
|
||||
Credit
|
—
|
|
|
175
|
|
|
14
|
|
|
189
|
|
||||
Equity market
|
65
|
|
|
1,287
|
|
|
357
|
|
|
1,709
|
|
||||
Total derivative assets
|
71
|
|
|
12,922
|
|
|
459
|
|
|
13,452
|
|
||||
Total other invested assets
|
274
|
|
|
12,983
|
|
|
459
|
|
|
13,716
|
|
||||
Net embedded derivatives within asset host contracts (3)
|
—
|
|
|
—
|
|
|
377
|
|
|
377
|
|
||||
Separate account assets (4)
|
83,533
|
|
|
231,539
|
|
|
1,922
|
|
|
316,994
|
|
||||
Total assets
|
$
|
135,986
|
|
|
$
|
562,648
|
|
|
$
|
26,449
|
|
|
$
|
725,083
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivative liabilities: (2)
|
|
|
|
|
|
|
|
||||||||
Interest rate
|
$
|
9
|
|
|
$
|
2,347
|
|
|
$
|
—
|
|
|
$
|
2,356
|
|
Foreign currency exchange rate
|
—
|
|
|
2,755
|
|
|
93
|
|
|
2,848
|
|
||||
Credit
|
—
|
|
|
38
|
|
|
2
|
|
|
40
|
|
||||
Equity market
|
2
|
|
|
1,112
|
|
|
664
|
|
|
1,778
|
|
||||
Total derivative liabilities
|
11
|
|
|
6,252
|
|
|
759
|
|
|
7,022
|
|
||||
Net embedded derivatives within liability host contracts (3)
|
—
|
|
|
7
|
|
|
(53
|
)
|
|
(46
|
)
|
||||
Long-term debt of CSEs — FVO
|
—
|
|
|
138
|
|
|
13
|
|
|
151
|
|
||||
Trading liabilities (5)
|
215
|
|
|
24
|
|
|
—
|
|
|
239
|
|
||||
Total liabilities
|
$
|
226
|
|
|
$
|
6,421
|
|
|
$
|
719
|
|
|
$
|
7,366
|
|
(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 policyholder account balances, future policy benefits and other liabilities on the consolidated balance sheets. At
September 30, 2015
and
December 31, 2014
, debt and equity securities also included embedded derivatives of
($269) million
and
($217) 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.
|
(1)
|
Estimated fair value equals carrying value, based on the value of the underlying assets, including: mutual fund interests, fixed maturity securities, equity securities, derivatives, hedge funds, other limited partnership interests, short-term investments and cash and cash equivalents. Fixed maturity securities, equity securities, derivatives, short-term investments and cash and cash equivalents are similar in nature to the instruments described under “— Securities, Short-term Investments, Other Investments, Long-term Debt of CSEs — FVO and Trading Liabilities” and “— Derivatives —Freestanding Derivatives Valuation Techniques and Key Inputs.”
|
Instrument
|
|
Interest Rate
|
|
Foreign Currency
Exchange Rate
|
|
Credit
|
|
Equity Market
|
Inputs common to Level 2 and Level 3 by instrument type
|
•
|
swap yield curve
|
•
|
swap yield curve
|
•
|
swap yield curve
|
•
|
swap yield curve
|
•
|
basis curves
|
•
|
basis curves
|
•
|
credit curves
|
•
|
spot equity index levels
|
|
•
|
interest rate volatility (1)
|
•
|
currency spot rates
|
•
|
recovery rates
|
•
|
dividend yield curves
|
|
|
|
|
•
|
cross currency basis curves
|
|
|
•
|
equity volatility (1)
|
|
|
|
•
|
currency volatility (1)
|
|
|
|
|
Level 3
|
•
|
swap yield curve (2)
|
•
|
swap yield curve (2)
|
•
|
swap yield curve (2)
|
•
|
dividend yield curves (2)
|
|
•
|
basis curves (2)
|
•
|
basis curves (2)
|
•
|
credit curves (2)
|
•
|
equity volatility (1), (2)
|
|
•
|
interest rate volatility (1), (2)
|
•
|
cross currency basis curves (2)
|
•
|
credit spreads
|
•
|
correlation between model inputs (1)
|
|
|
|
•
|
currency correlation
|
•
|
repurchase rates
|
|
|
|
|
|
•
|
currency volatility (1)
|
•
|
independent non-binding broker quotations
|
|
|
(1)
|
Option-based only.
|
(2)
|
Extrapolation beyond the observable limits of the curve(s).
|
|
|
|
|
|
|
|
September 30, 2015
|
|
December 31, 2014
|
|
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)
|
|
(50)
|
-
|
240
|
|
40
|
|
(40)
|
-
|
240
|
|
46
|
|
Decrease
|
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
1
|
-
|
780
|
|
149
|
|
—
|
-
|
750
|
|
151
|
|
Increase
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (5)
|
|
68
|
-
|
119
|
|
98
|
|
31
|
-
|
126
|
|
99
|
|
Increase
|
Foreign government
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
81
|
-
|
197
|
|
113
|
|
92
|
-
|
189
|
|
106
|
|
Increase
|
RMBS
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
22
|
-
|
165
|
|
93
|
|
22
|
-
|
120
|
|
97
|
|
Increase (6)
|
ABS
|
•
|
Market pricing
|
|
•
|
Quoted prices (5)
|
|
15
|
-
|
112
|
|
101
|
|
15
|
-
|
110
|
|
100
|
|
Increase (6)
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (5)
|
|
66
|
-
|
106
|
|
100
|
|
56
|
-
|
106
|
|
102
|
|
Increase (6)
|
Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate
|
•
|
Present value techniques
|
|
•
|
Swap yield (7)
|
|
293
|
-
|
583
|
|
|
|
278
|
-
|
297
|
|
|
|
Increase (12)
|
Foreign currency exchange rate
|
•
|
Present value techniques
|
|
•
|
Swap yield (7)
|
|
5
|
-
|
330
|
|
|
|
62
|
-
|
2,430
|
|
|
|
Increase (12)
|
|
|
|
|
•
|
Correlation (8)
|
|
—
|
-
|
—
|
|
|
|
40%
|
-
|
55%
|
|
|
|
|
Credit
|
•
|
Present value techniques
|
|
•
|
Credit spreads (9)
|
|
99
|
-
|
100
|
|
|
|
98
|
-
|
100
|
|
|
|
Decrease (9)
|
|
•
|
Consensus pricing
|
|
•
|
Offered quotes (10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity market
|
•
|
Present value techniques or option pricing models
|
|
•
|
Volatility (11)
|
|
20%
|
-
|
35%
|
|
|
|
15%
|
-
|
27%
|
|
|
|
Increase (12)
|
|
|
|
|
•
|
Correlation (8)
|
|
70%
|
-
|
70%
|
|
|
|
70%
|
-
|
70%
|
|
|
|
|
Embedded derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Direct and assumed guaranteed minimum benefits
|
•
|
Option pricing techniques
|
|
•
|
Mortality rates:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ages 0 - 40
|
|
0%
|
-
|
0.28%
|
|
|
|
0%
|
-
|
0.28%
|
|
|
|
Decrease (13)
|
|
|
|
|
|
Ages 41 - 60
|
|
0.01%
|
-
|
0.75%
|
|
|
|
0.04%
|
-
|
0.88%
|
|
|
|
Decrease (13)
|
|
|
|
|
|
Ages 61 - 115
|
|
0.04%
|
-
|
100%
|
|
|
|
0.26%
|
-
|
100%
|
|
|
|
Decrease (13)
|
|
|
|
|
•
|
Lapse rates:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Durations 1 - 10
|
|
0.25%
|
-
|
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
|
|
0%
|
-
|
25%
|
|
|
|
20%
|
-
|
50%
|
|
|
|
Increase (15)
|
|
|
|
|
•
|
Withdrawal rates
|
|
0%
|
-
|
20%
|
|
|
|
0%
|
-
|
20%
|
|
|
|
(16)
|
|
|
|
|
•
|
Long-term equity volatilities
|
|
8.65%
|
-
|
33%
|
|
|
|
7.30%
|
-
|
33%
|
|
|
|
Increase (17)
|
|
|
|
|
•
|
Nonperformance risk spread
|
|
(0.22)%
|
-
|
1.17%
|
|
|
|
(0.35)%
|
-
|
0.81%
|
|
|
|
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
September 30, 2015
and
December 31, 2014
, 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
|
|
U.S
Treasury
and Agency
|
|
Foreign
Government
|
|
RMBS
|
|
State and
Political
Subdivision
|
|
CMBS
|
|
ABS
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
7,133
|
|
|
$
|
6,387
|
|
|
$
|
55
|
|
|
$
|
1,336
|
|
|
$
|
4,136
|
|
|
$
|
55
|
|
|
$
|
729
|
|
|
$
|
2,153
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
7
|
|
|
2
|
|
|
—
|
|
|
4
|
|
|
32
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
16
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(59
|
)
|
|
(237
|
)
|
|
—
|
|
|
(1
|
)
|
|
(47
|
)
|
|
1
|
|
|
8
|
|
|
(7
|
)
|
||||||||
Purchases (3)
|
|
694
|
|
|
261
|
|
|
—
|
|
|
17
|
|
|
1,583
|
|
|
20
|
|
|
165
|
|
|
796
|
|
||||||||
Sales (3)
|
|
(301
|
)
|
|
(50
|
)
|
|
(1
|
)
|
|
(17
|
)
|
|
(262
|
)
|
|
—
|
|
|
(39
|
)
|
|
(117
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
552
|
|
|
147
|
|
|
18
|
|
|
11
|
|
|
359
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(1,007
|
)
|
|
(843
|
)
|
|
(55
|
)
|
|
(659
|
)
|
|
(318
|
)
|
|
(30
|
)
|
|
(18
|
)
|
|
(619
|
)
|
||||||||
Balance, end of period
|
|
$
|
7,035
|
|
|
$
|
5,667
|
|
|
$
|
17
|
|
|
$
|
691
|
|
|
$
|
5,480
|
|
|
$
|
46
|
|
|
$
|
847
|
|
|
$
|
2,206
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
7
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
32
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
|
|
||||||||||||||||||||||||
|
|
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 |
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
157
|
|
|
$
|
332
|
|
|
$
|
13
|
|
|
$
|
88
|
|
|
$
|
364
|
|
|
$
|
10
|
|
|
$
|
1,809
|
|
|
$
|
345
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||||||
Net investment gains (losses)
|
|
8
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(11
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchases (3)
|
|
12
|
|
|
—
|
|
|
32
|
|
|
13
|
|
|
46
|
|
|
—
|
|
|
1,296
|
|
|
18
|
|
||||||||
Sales (3)
|
|
(12
|
)
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(40
|
)
|
|
—
|
|
|
(11
|
)
|
|
(37
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|
—
|
|
|
5
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(28
|
)
|
|
(2
|
)
|
|
(5
|
)
|
|
—
|
|
|
(186
|
)
|
|
—
|
|
|
(1,786
|
)
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
126
|
|
|
$
|
324
|
|
|
$
|
40
|
|
|
$
|
91
|
|
|
$
|
257
|
|
|
$
|
10
|
|
|
$
|
1,313
|
|
|
$
|
315
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(9
|
)
|
|
$
|
(7
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
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
|
|
Trading
Liabilities
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
18
|
|
|
$
|
(76
|
)
|
|
$
|
9
|
|
|
$
|
(323
|
)
|
|
$
|
841
|
|
|
$
|
1,925
|
|
|
$
|
(12
|
)
|
|
$
|
(4
|
)
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
1
|
|
|
(93
|
)
|
|
(5
|
)
|
|
—
|
|
|
(1,812
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchases (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
95
|
|
|
—
|
|
|
(2
|
)
|
||||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(93
|
)
|
|
—
|
|
|
—
|
|
||||||||
Issuances (3)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
(216
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(271
|
)
|
|
—
|
|
|
4
|
|
||||||||
Balance, end of period
|
|
$
|
25
|
|
|
$
|
(145
|
)
|
|
$
|
4
|
|
|
$
|
(323
|
)
|
|
$
|
(1,166
|
)
|
|
$
|
1,682
|
|
|
$
|
(11
|
)
|
|
$
|
(2
|
)
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
(99
|
)
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
(1,803
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Fixed Maturity Securities
|
||||||||||||||||||||||||||||||
|
|
U.S.
Corporate
|
|
Foreign
Corporate
|
|
U.S.
Treasury and Agency |
|
Foreign
Government
|
|
RMBS
|
|
State and
Political
Subdivision
|
|
CMBS
|
|
ABS
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended September 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
7,369
|
|
|
$
|
6,612
|
|
|
$
|
320
|
|
|
$
|
1,672
|
|
|
$
|
3,945
|
|
|
$
|
35
|
|
|
$
|
595
|
|
|
$
|
3,786
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
2
|
|
|
7
|
|
|
—
|
|
|
4
|
|
|
11
|
|
|
—
|
|
|
2
|
|
|
1
|
|
||||||||
Net investment gains (losses)
|
|
(1
|
)
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
14
|
|
|
(179
|
)
|
|
—
|
|
|
(32
|
)
|
|
28
|
|
|
(1
|
)
|
|
9
|
|
|
(5
|
)
|
||||||||
Purchases (3)
|
|
645
|
|
|
449
|
|
|
—
|
|
|
114
|
|
|
708
|
|
|
—
|
|
|
58
|
|
|
1,164
|
|
||||||||
Sales (3)
|
|
(198
|
)
|
|
(145
|
)
|
|
—
|
|
|
(29
|
)
|
|
(340
|
)
|
|
(7
|
)
|
|
(64
|
)
|
|
(177
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
10
|
|
|
124
|
|
|
—
|
|
|
167
|
|
|
—
|
|
|
—
|
|
|
62
|
|
|
74
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(501
|
)
|
|
(630
|
)
|
|
(320
|
)
|
|
(618
|
)
|
|
(346
|
)
|
|
(23
|
)
|
|
(15
|
)
|
|
(1,564
|
)
|
||||||||
Balance, end of period
|
|
$
|
7,340
|
|
|
$
|
6,233
|
|
|
$
|
—
|
|
|
$
|
1,278
|
|
|
$
|
4,006
|
|
|
$
|
4
|
|
|
$
|
634
|
|
|
$
|
3,279
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
2
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(13
|
)
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
|
|||||||||||||||||||||||||
|
|
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
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended September 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
186
|
|
|
$
|
263
|
|
|
$
|
20
|
|
|
$
|
109
|
|
|
$
|
571
|
|
|
$
|
11
|
|
|
$
|
246
|
|
|
$
|
367
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(22
|
)
|
|
—
|
|
|
1
|
|
|
4
|
|
||||||||
Net investment gains (losses)
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(37
|
)
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchases (3)
|
|
3
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
169
|
|
|
—
|
|
|
114
|
|
|
3
|
|
||||||||
Sales (3)
|
|
(10
|
)
|
|
(13
|
)
|
|
(15
|
)
|
|
(6
|
)
|
|
(288
|
)
|
|
—
|
|
|
(131
|
)
|
|
(63
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
||||||||
Transfers into Level 3 (4)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(42
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
|
(75
|
)
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
101
|
|
|
$
|
247
|
|
|
$
|
8
|
|
|
$
|
99
|
|
|
$
|
488
|
|
|
$
|
12
|
|
|
$
|
155
|
|
|
$
|
298
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(16
|
)
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
4
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
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
|
|
Trading Liabilities
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Three Months Ended September 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
36
|
|
|
$
|
(3
|
)
|
|
$
|
17
|
|
|
$
|
(395
|
)
|
|
$
|
1,020
|
|
|
$
|
1,691
|
|
|
$
|
(15
|
)
|
|
$
|
—
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
(1
|
)
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
(9
|
)
|
|
(68
|
)
|
|
(8
|
)
|
|
50
|
|
|
(58
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
32
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
20
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
102
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchases (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
117
|
|
|
—
|
|
|
—
|
|
||||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(129
|
)
|
|
—
|
|
|
—
|
|
||||||||
Issuances (3)
|
|
(2
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
2
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
(231
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
219
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
47
|
|
|
$
|
(54
|
)
|
|
$
|
8
|
|
|
$
|
(346
|
)
|
|
$
|
865
|
|
|
$
|
1,891
|
|
|
$
|
(15
|
)
|
|
$
|
—
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
1
|
|
|
$
|
(52
|
)
|
|
$
|
(8
|
)
|
|
$
|
50
|
|
|
$
|
(65
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
31
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Fixed Maturity Securities
|
||||||||||||||||||||||||||||||
|
|
U.S.
Corporate |
|
Foreign
Corporate |
|
U.S. Treasury and Agency
|
|
Foreign
Government |
|
RMBS
|
|
State and
Political Subdivision |
|
CMBS
|
|
ABS
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
6,942
|
|
|
$
|
6,490
|
|
|
$
|
—
|
|
|
$
|
1,311
|
|
|
$
|
4,383
|
|
|
$
|
—
|
|
|
$
|
765
|
|
|
$
|
2,244
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
14
|
|
|
11
|
|
|
—
|
|
|
10
|
|
|
88
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||||
Net investment gains (losses)
|
|
33
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(301
|
)
|
|
(458
|
)
|
|
(1
|
)
|
|
1
|
|
|
(40
|
)
|
|
—
|
|
|
(3
|
)
|
|
(25
|
)
|
||||||||
Purchases (3)
|
|
1,250
|
|
|
634
|
|
|
—
|
|
|
30
|
|
|
2,392
|
|
|
46
|
|
|
308
|
|
|
1,362
|
|
||||||||
Sales (3)
|
|
(658
|
)
|
|
(306
|
)
|
|
(1
|
)
|
|
(39
|
)
|
|
(848
|
)
|
|
—
|
|
|
(168
|
)
|
|
(288
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
687
|
|
|
157
|
|
|
19
|
|
|
7
|
|
|
295
|
|
|
—
|
|
|
21
|
|
|
39
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(932
|
)
|
|
(865
|
)
|
|
—
|
|
|
(629
|
)
|
|
(789
|
)
|
|
—
|
|
|
(76
|
)
|
|
(1,127
|
)
|
||||||||
Balance, end of period
|
|
$
|
7,035
|
|
|
$
|
5,667
|
|
|
$
|
17
|
|
|
$
|
691
|
|
|
$
|
5,480
|
|
|
$
|
46
|
|
|
$
|
847
|
|
|
$
|
2,206
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
13
|
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
10
|
|
|
$
|
88
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
|
|
||||||||||||||||||||||||
|
|
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 |
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
95
|
|
|
$
|
250
|
|
|
$
|
5
|
|
|
$
|
95
|
|
|
$
|
455
|
|
|
$
|
12
|
|
|
$
|
336
|
|
|
$
|
308
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
(17
|
)
|
|
—
|
|
|
1
|
|
|
18
|
|
||||||||
Net investment gains (losses)
|
|
8
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(10
|
)
|
|
(12
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchases (3)
|
|
54
|
|
|
3
|
|
|
35
|
|
|
14
|
|
|
81
|
|
|
—
|
|
|
1,313
|
|
|
114
|
|
||||||||
Sales (3)
|
|
(19
|
)
|
|
(15
|
)
|
|
—
|
|
|
(8
|
)
|
|
(121
|
)
|
|
(1
|
)
|
|
(28
|
)
|
|
(100
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
||||||||
Transfers into Level 3 (4)
|
|
1
|
|
|
106
|
|
|
—
|
|
|
—
|
|
|
82
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(3
|
)
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
(223
|
)
|
|
(1
|
)
|
|
(309
|
)
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
126
|
|
|
$
|
324
|
|
|
$
|
40
|
|
|
$
|
91
|
|
|
$
|
257
|
|
|
$
|
10
|
|
|
$
|
1,313
|
|
|
$
|
315
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(10
|
)
|
|
$
|
(15
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
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
|
|
Trading Liabilities
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
63
|
|
|
$
|
(68
|
)
|
|
$
|
12
|
|
|
$
|
(307
|
)
|
|
$
|
430
|
|
|
$
|
1,922
|
|
|
$
|
(13
|
)
|
|
$
|
—
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net investment gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
(8
|
)
|
|
(118
|
)
|
|
(8
|
)
|
|
(30
|
)
|
|
(1,004
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
40
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
2
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchases (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
297
|
|
|
—
|
|
|
(2
|
)
|
||||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(232
|
)
|
|
—
|
|
|
—
|
|
||||||||
Issuances (3)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
(31
|
)
|
|
40
|
|
|
—
|
|
|
9
|
|
|
(613
|
)
|
|
(2
|
)
|
|
2
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(311
|
)
|
|
—
|
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
25
|
|
|
$
|
(145
|
)
|
|
$
|
4
|
|
|
$
|
(323
|
)
|
|
$
|
(1,166
|
)
|
|
$
|
1,682
|
|
|
$
|
(11
|
)
|
|
$
|
(2
|
)
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
(107
|
)
|
|
$
|
(6
|
)
|
|
$
|
(29
|
)
|
|
$
|
(1,016
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
43
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Fixed Maturity Securities
|
||||||||||||||||||||||||||||||
|
|
U.S.
Corporate
|
|
Foreign
Corporate
|
|
U.S.
Treasury and Agency |
|
Foreign
Government
|
|
RMBS
|
|
State and
Political
Subdivision
|
|
CMBS
|
|
ABS
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Nine Months Ended September 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, beginning of period
|
|
$
|
7,148
|
|
|
$
|
6,704
|
|
|
$
|
62
|
|
|
$
|
2,235
|
|
|
$
|
2,957
|
|
|
$
|
10
|
|
|
$
|
972
|
|
|
$
|
4,210
|
|
Total realized/unrealized gains (losses) included in:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss): (1), (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
7
|
|
|
16
|
|
|
—
|
|
|
106
|
|
|
34
|
|
|
—
|
|
|
2
|
|
|
6
|
|
||||||||
Net investment gains (losses)
|
|
(6
|
)
|
|
(8
|
)
|
|
—
|
|
|
(4
|
)
|
|
8
|
|
|
—
|
|
|
(14
|
)
|
|
(39
|
)
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
276
|
|
|
277
|
|
|
—
|
|
|
(104
|
)
|
|
96
|
|
|
—
|
|
|
(21
|
)
|
|
56
|
|
||||||||
Purchases (3)
|
|
1,213
|
|
|
893
|
|
|
—
|
|
|
265
|
|
|
1,278
|
|
|
—
|
|
|
133
|
|
|
2,369
|
|
||||||||
Sales (3)
|
|
(746
|
)
|
|
(516
|
)
|
|
—
|
|
|
(160
|
)
|
|
(443
|
)
|
|
—
|
|
|
(270
|
)
|
|
(793
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
261
|
|
|
281
|
|
|
—
|
|
|
189
|
|
|
146
|
|
|
4
|
|
|
73
|
|
|
37
|
|
||||||||
Transfers out of Level 3 (4)
|
|
(813
|
)
|
|
(1,414
|
)
|
|
(62
|
)
|
|
(1,249
|
)
|
|
(70
|
)
|
|
(10
|
)
|
|
(241
|
)
|
|
(2,567
|
)
|
||||||||
Balance, end of period
|
|
$
|
7,340
|
|
|
$
|
6,233
|
|
|
$
|
—
|
|
|
$
|
1,278
|
|
|
$
|
4,006
|
|
|
$
|
4
|
|
|
$
|
634
|
|
|
$
|
3,279
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
4
|
|
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
34
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
2
|
|
Net investment gains (losses)
|
|
$
|
(7
|
)
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
(13
|
)
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||||||||||||||||
|
|
Equity Securities
|
|
FVO and Trading Securities
|
|
|
|
|||||||||||||||||||||||||
|
|
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
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Nine Months Ended September 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
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
6
|
|
|
—
|
|
|
3
|
|
|
15
|
|
||||||||
Net investment gains (losses)
|
|
13
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
(78
|
)
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||||||
Purchases (3)
|
|
28
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
290
|
|
|
—
|
|
|
126
|
|
|
49
|
|
||||||||
Sales (3)
|
|
(40
|
)
|
|
(58
|
)
|
|
(7
|
)
|
|
(6
|
)
|
|
(449
|
)
|
|
(2
|
)
|
|
(205
|
)
|
|
(78
|
)
|
||||||||
Issuances (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
||||||||
Transfers into Level 3 (4)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
69
|
|
|
60
|
|
|
14
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
—
|
|
|
(100
|
)
|
|
(5
|
)
|
|
—
|
|
|
(22
|
)
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
101
|
|
|
$
|
247
|
|
|
$
|
8
|
|
|
$
|
99
|
|
|
$
|
488
|
|
|
$
|
12
|
|
|
$
|
155
|
|
|
$
|
298
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
15
|
|
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
|
|
Trading
Liabilities
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
Nine Months Ended September 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)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
99
|
|
|
(1
|
)
|
|
—
|
|
||||||||
Net derivative gains (losses)
|
|
16
|
|
|
(59
|
)
|
|
(17
|
)
|
|
(39
|
)
|
|
102
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Policyholder benefits and claims
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
55
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
OCI
|
|
69
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
78
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchases (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
510
|
|
|
—
|
|
|
—
|
|
||||||||
Sales (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(337
|
)
|
|
—
|
|
|
—
|
|
||||||||
Issuances (3)
|
|
(2
|
)
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
82
|
|
|
—
|
|
|
—
|
|
||||||||
Settlements (3)
|
|
(49
|
)
|
|
14
|
|
|
—
|
|
|
—
|
|
|
(628
|
)
|
|
(28
|
)
|
|
14
|
|
|
—
|
|
||||||||
Transfers into Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
147
|
|
|
—
|
|
|
—
|
|
||||||||
Transfers out of Level 3 (4)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
|
—
|
|
||||||||
Balance, end of period
|
|
$
|
47
|
|
|
$
|
(54
|
)
|
|
$
|
8
|
|
|
$
|
(346
|
)
|
|
$
|
865
|
|
|
$
|
1,891
|
|
|
$
|
(15
|
)
|
|
$
|
—
|
|
Changes in unrealized gains (losses) included in net income (loss): (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net investment income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net investment gains (losses)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
Net derivative gains (losses)
|
|
$
|
1
|
|
|
$
|
(45
|
)
|
|
$
|
(15
|
)
|
|
$
|
(38
|
)
|
|
$
|
103
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Policyholder benefits and claims
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
55
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Amortization of premium/accretion of discount is included within net investment income. Impairments charged to net income (loss) on securities are included in net investment gains (losses), while changes in estimated fair value of residential 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
|
|
Certain Assets
and Liabilities
of CSEs — FVO (1)
|
||||||||||||
|
|
September 30, 2015
|
|
December 31, 2014
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Unpaid principal balance
|
|
$
|
445
|
|
|
$
|
436
|
|
|
$
|
152
|
|
|
$
|
223
|
|
Difference between estimated fair value and unpaid principal balance
|
|
(130
|
)
|
|
(128
|
)
|
|
52
|
|
|
57
|
|
||||
Carrying value at estimated fair value
|
|
$
|
315
|
|
|
$
|
308
|
|
|
$
|
204
|
|
|
$
|
280
|
|
Loans in non-accrual status
|
|
$
|
125
|
|
|
$
|
125
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Contractual principal balance
|
|
|
|
|
|
$
|
83
|
|
|
$
|
159
|
|
||||
Difference between estimated fair value and contractual principal balance
|
|
|
|
|
|
(11
|
)
|
|
(8
|
)
|
||||||
Carrying value at estimated fair value
|
|
|
|
|
|
$
|
72
|
|
|
$
|
151
|
|
(1)
|
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 September 30,
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||||||
|
Carrying Value After Measurement
|
|
Gains (Losses)
|
||||||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Mortgage loans (1)
|
$
|
44
|
|
|
$
|
106
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
(1
|
)
|
|
$
|
3
|
|
Other limited partnership interests (2)
|
$
|
53
|
|
|
$
|
92
|
|
|
$
|
(8
|
)
|
|
$
|
(14
|
)
|
|
$
|
(27
|
)
|
|
$
|
(51
|
)
|
(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
September 30, 2015
and
2014
were not significant.
|
|
September 30, 2015
|
||||||||||||||||||
|
|
|
Fair Value Hierarchy
|
|
|
||||||||||||||
|
Carrying
Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
Estimated
Fair Value
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage loans
|
$
|
63,034
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
65,631
|
|
|
$
|
65,631
|
|
Policy loans
|
$
|
11,549
|
|
|
$
|
—
|
|
|
$
|
1,592
|
|
|
$
|
12,324
|
|
|
$
|
13,916
|
|
Real estate joint ventures
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
114
|
|
|
$
|
114
|
|
Other limited partnership interests
|
$
|
580
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
729
|
|
|
$
|
729
|
|
Other invested assets
|
$
|
541
|
|
|
$
|
162
|
|
|
$
|
2
|
|
|
$
|
377
|
|
|
$
|
541
|
|
Premiums, reinsurance and other receivables
|
$
|
5,578
|
|
|
$
|
—
|
|
|
$
|
3,264
|
|
|
$
|
2,416
|
|
|
$
|
5,680
|
|
Other assets
|
$
|
365
|
|
|
$
|
—
|
|
|
$
|
337
|
|
|
$
|
61
|
|
|
$
|
398
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Policyholder account balances
|
$
|
124,476
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
129,880
|
|
|
$
|
129,880
|
|
Long-term debt
|
$
|
16,674
|
|
|
$
|
—
|
|
|
$
|
18,226
|
|
|
$
|
—
|
|
|
$
|
18,226
|
|
Collateral financing arrangements
|
$
|
4,152
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,925
|
|
|
$
|
3,925
|
|
Junior subordinated debt securities
|
$
|
3,194
|
|
|
$
|
—
|
|
|
$
|
4,036
|
|
|
$
|
—
|
|
|
$
|
4,036
|
|
Other liabilities
|
$
|
6,730
|
|
|
$
|
—
|
|
|
$
|
5,396
|
|
|
$
|
1,336
|
|
|
$
|
6,732
|
|
Separate account liabilities
|
$
|
111,427
|
|
|
$
|
—
|
|
|
$
|
111,427
|
|
|
$
|
—
|
|
|
$
|
111,427
|
|
|
December 31, 2014
|
||||||||||||||||||
|
|
|
Fair Value Hierarchy
|
|
|
||||||||||||||
|
Carrying
Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
Estimated
Fair Value
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage loans
|
$
|
59,530
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
62,554
|
|
|
$
|
62,554
|
|
Policy loans
|
$
|
11,618
|
|
|
$
|
—
|
|
|
$
|
1,647
|
|
|
$
|
12,287
|
|
|
$
|
13,934
|
|
Real estate joint ventures
|
$
|
67
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
139
|
|
|
$
|
139
|
|
Other limited partnership interests
|
$
|
704
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
906
|
|
|
$
|
906
|
|
Other invested assets
|
$
|
562
|
|
|
$
|
172
|
|
|
$
|
70
|
|
|
$
|
320
|
|
|
$
|
562
|
|
Premiums, reinsurance and other receivables
|
$
|
3,070
|
|
|
$
|
—
|
|
|
$
|
713
|
|
|
$
|
2,444
|
|
|
$
|
3,157
|
|
Other assets
|
$
|
251
|
|
|
$
|
—
|
|
|
$
|
175
|
|
|
$
|
68
|
|
|
$
|
243
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Policyholder account balances
|
$
|
134,219
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
139,359
|
|
|
$
|
139,359
|
|
Long-term debt
|
$
|
16,128
|
|
|
$
|
—
|
|
|
$
|
18,357
|
|
|
$
|
—
|
|
|
$
|
18,357
|
|
Collateral financing arrangements
|
$
|
4,196
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,961
|
|
|
$
|
3,961
|
|
Junior subordinated debt securities
|
$
|
3,193
|
|
|
$
|
—
|
|
|
$
|
4,173
|
|
|
$
|
—
|
|
|
$
|
4,173
|
|
Other liabilities
|
$
|
2,544
|
|
|
$
|
—
|
|
|
$
|
1,223
|
|
|
$
|
1,323
|
|
|
$
|
2,546
|
|
Separate account liabilities
|
$
|
116,665
|
|
|
$
|
—
|
|
|
$
|
116,665
|
|
|
$
|
—
|
|
|
$
|
116,665
|
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||
Series
|
|
Shares
Authorized
|
|
Shares
Issued
|
|
Shares
Outstanding
|
|
Shares
Authorized
|
|
Shares
Issued
|
|
Shares
Outstanding
|
||||||
Floating Rate Non-Cumulative Preferred Stock, Series A
|
|
27,600,000
|
|
|
24,000,000
|
|
|
24,000,000
|
|
|
27,600,000
|
|
|
24,000,000
|
|
|
24,000,000
|
|
6.50% Non-Cumulative Preferred Stock, Series B (1)
|
|
69,000,000
|
|
|
—
|
|
|
—
|
|
|
69,000,000
|
|
|
60,000,000
|
|
|
60,000,000
|
|
5.25% Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series C
|
|
1,500,000
|
|
|
1,500,000
|
|
|
1,500,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Series A Junior Participating Preferred Stock
|
|
10,000,000
|
|
|
—
|
|
|
—
|
|
|
10,000,000
|
|
|
—
|
|
|
—
|
|
Not designated
|
|
91,900,000
|
|
|
—
|
|
|
—
|
|
|
93,400,000
|
|
|
—
|
|
|
—
|
|
Total
|
|
200,000,000
|
|
|
25,500,000
|
|
|
25,500,000
|
|
|
200,000,000
|
|
|
84,000,000
|
|
|
84,000,000
|
|
(1)
|
As previously discussed, MetLife, Inc. redeemed and canceled the Series B preferred
stock in 2015
.
|
|
Three Months
Ended September 30, 2015 |
||||||||||||||||||
|
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
|
$
|
11,761
|
|
|
$
|
1,102
|
|
|
$
|
(4,214
|
)
|
|
$
|
(2,206
|
)
|
|
$
|
6,443
|
|
OCI before reclassifications
|
962
|
|
|
102
|
|
|
(336
|
)
|
|
—
|
|
|
728
|
|
|||||
Deferred income tax benefit (expense)
|
(340
|
)
|
|
(47
|
)
|
|
(24
|
)
|
|
—
|
|
|
(411
|
)
|
|||||
AOCI before reclassifications, net of income tax
|
12,383
|
|
|
1,157
|
|
|
(4,574
|
)
|
|
(2,206
|
)
|
|
6,760
|
|
|||||
Amounts reclassified from AOCI
|
(102
|
)
|
|
239
|
|
|
—
|
|
|
57
|
|
|
194
|
|
|||||
Deferred income tax benefit (expense)
|
34
|
|
|
(77
|
)
|
|
—
|
|
|
(20
|
)
|
|
(63
|
)
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(68
|
)
|
|
162
|
|
|
—
|
|
|
37
|
|
|
131
|
|
|||||
Sale of subsidiary
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Deferred income tax benefit (expense)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Sale of subsidiary, net of income tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, end of period
|
$
|
12,315
|
|
|
$
|
1,319
|
|
|
$
|
(4,574
|
)
|
|
$
|
(2,169
|
)
|
|
$
|
6,891
|
|
|
Three Months
Ended September 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
|
$
|
13,909
|
|
|
$
|
476
|
|
|
$
|
(1,739
|
)
|
|
$
|
(1,588
|
)
|
|
$
|
11,058
|
|
OCI before reclassifications
|
(56
|
)
|
|
118
|
|
|
(264
|
)
|
|
28
|
|
|
(174
|
)
|
|||||
Deferred income tax benefit (expense)
|
130
|
|
|
(49
|
)
|
|
(157
|
)
|
|
(9
|
)
|
|
(85
|
)
|
|||||
AOCI before reclassifications, net of income tax
|
13,983
|
|
|
545
|
|
|
(2,160
|
)
|
|
(1,569
|
)
|
|
10,799
|
|
|||||
Amounts reclassified from AOCI
|
(214
|
)
|
|
471
|
|
|
—
|
|
|
45
|
|
|
302
|
|
|||||
Deferred income tax benefit (expense)
|
62
|
|
|
(158
|
)
|
|
—
|
|
|
(13
|
)
|
|
(109
|
)
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(152
|
)
|
|
313
|
|
|
—
|
|
|
32
|
|
|
193
|
|
|||||
Sale of subsidiary
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Deferred income tax benefit (expense)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Sale of subsidiary, net of income tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, end of period
|
$
|
13,831
|
|
|
$
|
858
|
|
|
$
|
(2,160
|
)
|
|
$
|
(1,537
|
)
|
|
$
|
10,992
|
|
|
Nine Months
Ended September 30, 2015 |
||||||||||||||||||
|
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
|
$
|
15,159
|
|
|
$
|
1,076
|
|
|
$
|
(3,303
|
)
|
|
$
|
(2,283
|
)
|
|
$
|
10,649
|
|
OCI before reclassifications
|
(3,923
|
)
|
|
(106
|
)
|
|
(1,243
|
)
|
|
3
|
|
|
(5,269
|
)
|
|||||
Deferred income tax benefit (expense)
|
1,337
|
|
|
37
|
|
|
(28
|
)
|
|
(1
|
)
|
|
1,345
|
|
|||||
AOCI before reclassifications, net of income tax
|
12,573
|
|
|
1,007
|
|
|
(4,574
|
)
|
|
(2,281
|
)
|
|
6,725
|
|
|||||
Amounts reclassified from AOCI
|
(392
|
)
|
|
490
|
|
|
—
|
|
|
171
|
|
|
269
|
|
|||||
Deferred income tax benefit (expense)
|
134
|
|
|
(178
|
)
|
|
—
|
|
|
(59
|
)
|
|
(103
|
)
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(258
|
)
|
|
312
|
|
|
—
|
|
|
112
|
|
|
166
|
|
|||||
Sale of subsidiary
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Deferred income tax benefit (expense)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Sale of subsidiary, net of income tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, end of period
|
$
|
12,315
|
|
|
$
|
1,319
|
|
|
$
|
(4,574
|
)
|
|
$
|
(2,169
|
)
|
|
$
|
6,891
|
|
|
Nine Months
Ended September 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
|
9,126
|
|
|
614
|
|
|
(486
|
)
|
|
34
|
|
|
9,288
|
|
|||||
Deferred income tax benefit (expense)
|
(2,851
|
)
|
|
(210
|
)
|
|
(71
|
)
|
|
(11
|
)
|
|
(3,143
|
)
|
|||||
AOCI before reclassifications, net of income tax
|
14,458
|
|
|
635
|
|
|
(2,216
|
)
|
|
(1,628
|
)
|
|
11,249
|
|
|||||
Amounts reclassified from AOCI
|
(563
|
)
|
|
337
|
|
|
77
|
|
|
136
|
|
|
(13
|
)
|
|||||
Deferred income tax benefit (expense)
|
176
|
|
|
(114
|
)
|
|
(27
|
)
|
|
(45
|
)
|
|
(10
|
)
|
|||||
Amounts reclassified from AOCI, net of income tax
|
(387
|
)
|
|
223
|
|
|
50
|
|
|
91
|
|
|
(23
|
)
|
|||||
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
|
$
|
13,831
|
|
|
$
|
858
|
|
|
$
|
(2,160
|
)
|
|
$
|
(1,537
|
)
|
|
$
|
10,992
|
|
(1)
|
See Note
5
for information on offsets to investments related to future policy benefits, DAC, VOBA and DSI, and the policyholder dividend obligation.
|
(2)
|
See Note 3 of the Notes to the Consolidated Financial Statements included in the 2014 Annual Report.
|
AOCI Components
|
|
Amounts Reclassified from AOCI
|
|
Consolidated Statement of Operations and
Comprehensive Income (Loss) Locations
|
||||||||||||||
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
|
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
||||||||
|
|
(In millions)
|
|
|
||||||||||||||
Net unrealized investment gains (losses):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net unrealized investment gains (losses)
|
|
$
|
104
|
|
|
$
|
167
|
|
|
$
|
353
|
|
|
$
|
359
|
|
|
Net investment gains (losses)
|
Net unrealized investment gains (losses)
|
|
3
|
|
|
14
|
|
|
60
|
|
|
99
|
|
|
Net investment income
|
||||
Net unrealized investment gains (losses)
|
|
(5
|
)
|
|
33
|
|
|
(21
|
)
|
|
105
|
|
|
Net derivative gains (losses)
|
||||
Net unrealized investment gains (losses), before income tax
|
|
102
|
|
|
214
|
|
|
392
|
|
|
563
|
|
|
|
||||
Income tax (expense) benefit
|
|
(34
|
)
|
|
(62
|
)
|
|
(134
|
)
|
|
(176
|
)
|
|
|
||||
Net unrealized investment gains (losses), net of income tax
|
|
$
|
68
|
|
|
$
|
152
|
|
|
$
|
258
|
|
|
$
|
387
|
|
|
|
Unrealized gains (losses) on derivatives - cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
$
|
40
|
|
|
$
|
1
|
|
|
$
|
52
|
|
|
$
|
28
|
|
|
Net derivative gains (losses)
|
Interest rate swaps
|
|
3
|
|
|
3
|
|
|
9
|
|
|
7
|
|
|
Net investment income
|
||||
Interest rate forwards
|
|
1
|
|
|
(10
|
)
|
|
5
|
|
|
(8
|
)
|
|
Net derivative gains (losses)
|
||||
Interest rate forwards
|
|
1
|
|
|
—
|
|
|
3
|
|
|
2
|
|
|
Net investment income
|
||||
Interest rate forwards
|
|
1
|
|
|
1
|
|
|
2
|
|
|
2
|
|
|
Other expenses
|
||||
Foreign currency swaps
|
|
(286
|
)
|
|
(466
|
)
|
|
(563
|
)
|
|
(368
|
)
|
|
Net derivative gains (losses)
|
||||
Foreign currency swaps
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
Net investment income
|
||||
Foreign currency swaps
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
Other expenses
|
||||
Credit forwards
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
Net derivative gains (losses)
|
||||
Credit forwards
|
|
—
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
Net investment income
|
||||
Gains (losses) on cash flow hedges, before income tax
|
|
(239
|
)
|
|
(471
|
)
|
|
(490
|
)
|
|
(337
|
)
|
|
|
||||
Income tax (expense) benefit
|
|
77
|
|
|
158
|
|
|
178
|
|
|
114
|
|
|
|
||||
Gains (losses) on cash flow hedges, net of income tax
|
|
$
|
(162
|
)
|
|
$
|
(313
|
)
|
|
$
|
(312
|
)
|
|
$
|
(223
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign translation adjustment
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(77
|
)
|
|
Net investment gains (losses)
|
Income tax (expense) benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27
|
|
|
|
||||
Foreign translation adjustment, net of income tax
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(50
|
)
|
|
|
Defined benefit plans adjustment: (1)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of net actuarial gains (losses)
|
|
$
|
(58
|
)
|
|
$
|
(45
|
)
|
|
$
|
(174
|
)
|
|
$
|
(136
|
)
|
|
|
Amortization of prior service (costs) credit
|
|
1
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
|
||||
Amortization of defined benefit plan items, before
income tax
|
|
(57
|
)
|
|
(45
|
)
|
|
(171
|
)
|
|
(136
|
)
|
|
|
||||
Income tax (expense) benefit
|
|
20
|
|
|
13
|
|
|
59
|
|
|
45
|
|
|
|
||||
Amortization of defined benefit plan items, net of income tax
|
|
$
|
(37
|
)
|
|
$
|
(32
|
)
|
|
$
|
(112
|
)
|
|
$
|
(91
|
)
|
|
|
Total reclassifications, net of income tax
|
|
$
|
(131
|
)
|
|
$
|
(193
|
)
|
|
$
|
(166
|
)
|
|
$
|
23
|
|
|
|
(1)
|
These AOCI components are included in the computation of net periodic benefit costs. See Note
11
.
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Compensation
|
|
$
|
1,157
|
|
|
$
|
1,221
|
|
|
$
|
3,706
|
|
|
$
|
3,636
|
|
Pension, postretirement and postemployment benefit costs
|
|
100
|
|
|
131
|
|
|
297
|
|
|
368
|
|
||||
Commissions
|
|
1,103
|
|
|
1,294
|
|
|
3,382
|
|
|
3,884
|
|
||||
Volume-related costs
|
|
264
|
|
|
227
|
|
|
761
|
|
|
639
|
|
||||
Capitalization of DAC
|
|
(955
|
)
|
|
(1,071
|
)
|
|
(2,850
|
)
|
|
(3,149
|
)
|
||||
Amortization of DAC and VOBA
|
|
1,131
|
|
|
1,054
|
|
|
3,053
|
|
|
3,174
|
|
||||
Amortization of negative VOBA
|
|
(90
|
)
|
|
(107
|
)
|
|
(282
|
)
|
|
(333
|
)
|
||||
Interest expense on debt
|
|
302
|
|
|
295
|
|
|
908
|
|
|
919
|
|
||||
Premium taxes, licenses and fees
|
|
199
|
|
|
192
|
|
|
568
|
|
|
612
|
|
||||
Professional services
|
|
366
|
|
|
348
|
|
|
1,079
|
|
|
1,035
|
|
||||
Rent and related expenses, net of sublease income
|
|
78
|
|
|
95
|
|
|
245
|
|
|
273
|
|
||||
Other (1)
|
|
878
|
|
|
539
|
|
|
1,798
|
|
|
1,545
|
|
||||
Total other expenses
|
|
$
|
4,533
|
|
|
$
|
4,218
|
|
|
$
|
12,665
|
|
|
$
|
12,603
|
|
(1)
|
See Note
12
for a discussion of a charge related to income tax included in both the three months and nine months ended September 30, 2015.
|
|
Three Months
Ended September 30, |
||||||||||||||||||||||||||||||
|
2015
|
|
2014
|
||||||||||||||||||||||||||||
|
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
|
$
|
54
|
|
|
$
|
14
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
50
|
|
|
$
|
17
|
|
|
$
|
3
|
|
|
$
|
—
|
|
Interest costs
|
101
|
|
|
5
|
|
|
22
|
|
|
—
|
|
|
109
|
|
|
3
|
|
|
23
|
|
|
1
|
|
||||||||
Settlement and curtailment costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Expected return on plan assets
|
(134
|
)
|
|
(2
|
)
|
|
(19
|
)
|
|
—
|
|
|
(119
|
)
|
|
(2
|
)
|
|
(19
|
)
|
|
—
|
|
||||||||
Amortization of net actuarial (gains) losses
|
47
|
|
|
1
|
|
|
10
|
|
|
—
|
|
|
42
|
|
|
—
|
|
|
3
|
|
|
—
|
|
||||||||
Amortization of prior service costs (credit)
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net periodic benefit costs (credit)
|
$
|
67
|
|
|
$
|
18
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
96
|
|
|
$
|
18
|
|
|
$
|
10
|
|
|
$
|
1
|
|
|
Nine Months
Ended September 30, |
||||||||||||||||||||||||||||||
|
2015
|
|
2014
|
||||||||||||||||||||||||||||
|
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
|
$
|
162
|
|
|
$
|
44
|
|
|
$
|
11
|
|
|
$
|
1
|
|
|
$
|
150
|
|
|
$
|
51
|
|
|
$
|
10
|
|
|
$
|
1
|
|
Interest costs
|
303
|
|
|
15
|
|
|
66
|
|
|
1
|
|
|
327
|
|
|
10
|
|
|
69
|
|
|
2
|
|
||||||||
Settlement and curtailment costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Expected return on plan assets
|
(403
|
)
|
|
(5
|
)
|
|
(59
|
)
|
|
—
|
|
|
(356
|
)
|
|
(6
|
)
|
|
(56
|
)
|
|
(1
|
)
|
||||||||
Amortization of net actuarial (gains) losses
|
141
|
|
|
2
|
|
|
31
|
|
|
—
|
|
|
127
|
|
|
—
|
|
|
9
|
|
|
—
|
|
||||||||
Amortization of prior service costs (credit)
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||||||
Net periodic benefit costs (credit)
|
$
|
202
|
|
|
$
|
56
|
|
|
$
|
47
|
|
|
$
|
2
|
|
|
$
|
263
|
|
|
$
|
55
|
|
|
$
|
31
|
|
|
$
|
2
|
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions, except share and per share data)
|
||||||||||||||
Weighted Average Shares
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common stock outstanding for basic earnings per common share
|
|
1,118,856,041
|
|
|
1,125,165,772
|
|
|
1,120,130,708
|
|
|
1,126,280,770
|
|
||||
Incremental common shares from assumed:
|
|
|
|
|
|
|
|
|
||||||||
Stock purchase contracts underlying common equity units
|
|
—
|
|
|
4,572,193
|
|
|
—
|
|
|
3,904,760
|
|
||||
Exercise or issuance of stock-based awards
|
|
11,085,040
|
|
|
11,308,766
|
|
|
10,575,611
|
|
|
10,662,053
|
|
||||
Weighted average common stock outstanding for diluted earnings per common share
|
|
1,129,941,081
|
|
|
1,141,046,731
|
|
|
1,130,706,319
|
|
|
1,140,847,583
|
|
||||
Income (Loss) from Continuing Operations
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations, net of income tax
|
|
$
|
1,198
|
|
|
$
|
2,094
|
|
|
$
|
4,480
|
|
|
$
|
4,812
|
|
Less: Income (loss) from continuing operations, net of income tax, attributable to noncontrolling interests
|
|
(5
|
)
|
|
—
|
|
|
4
|
|
|
21
|
|
||||
Less: Preferred stock dividends
|
|
6
|
|
|
30
|
|
|
67
|
|
|
91
|
|
||||
Preferred stock repurchase premium
|
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
||||
Income (loss) from continuing operations, net of income tax, available to MetLife, Inc.’s common shareholders
|
|
$
|
1,197
|
|
|
$
|
2,064
|
|
|
$
|
4,367
|
|
|
$
|
4,700
|
|
Basic
|
|
$
|
1.07
|
|
|
$
|
1.83
|
|
|
$
|
3.90
|
|
|
$
|
4.17
|
|
Diluted
|
|
$
|
1.06
|
|
|
$
|
1.81
|
|
|
$
|
3.86
|
|
|
$
|
4.12
|
|
Income (Loss) from Discontinued Operations
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from discontinued operations, net of income tax
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
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
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
Basic
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Diluted
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net Income (Loss)
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
|
$
|
1,198
|
|
|
$
|
2,094
|
|
|
$
|
4,480
|
|
|
$
|
4,809
|
|
Less: Net income (loss) attributable to noncontrolling interests
|
|
(5
|
)
|
|
—
|
|
|
4
|
|
|
21
|
|
||||
Less: Preferred stock dividends
|
|
6
|
|
|
30
|
|
|
67
|
|
|
91
|
|
||||
Preferred stock repurchase premium
|
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
||||
Net income (loss) available to MetLife, Inc.’s common shareholders
|
|
$
|
1,197
|
|
|
$
|
2,064
|
|
|
$
|
4,367
|
|
|
$
|
4,697
|
|
Basic
|
|
$
|
1.07
|
|
|
$
|
1.83
|
|
|
$
|
3.90
|
|
|
$
|
4.17
|
|
Diluted
|
|
$
|
1.06
|
|
|
$
|
1.81
|
|
|
$
|
3.86
|
|
|
$
|
4.12
|
|
|
Page
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Income (loss) from continuing operations, net of income tax
|
$
|
1,198
|
|
|
$
|
2,094
|
|
|
$
|
4,480
|
|
|
$
|
4,812
|
|
Less: Net investment gains (losses)
|
382
|
|
|
109
|
|
|
535
|
|
|
(427
|
)
|
||||
Less: Net derivative gains (losses)
|
485
|
|
|
478
|
|
|
394
|
|
|
1,132
|
|
||||
Less: Other adjustments to continuing operations (1)
|
(206
|
)
|
|
(146
|
)
|
|
(693
|
)
|
|
(923
|
)
|
||||
Less: Provision for income tax (expense) benefit
|
(174
|
)
|
|
(202
|
)
|
|
69
|
|
|
(38
|
)
|
||||
Operating earnings
|
711
|
|
|
1,855
|
|
|
4,175
|
|
|
5,068
|
|
||||
Less: Preferred stock dividends
|
6
|
|
|
30
|
|
|
67
|
|
|
91
|
|
||||
Operating earnings available to common shareholders
|
$
|
705
|
|
|
$
|
1,825
|
|
|
$
|
4,108
|
|
|
$
|
4,977
|
|
(1)
|
See definitions of operating revenues and operating expenses under “— Non-GAAP and Other Financial Disclosures” for the components of such adjustments.
|
•
|
an unfavorable change in operating earnings available to common shareholders of $1.1 billion, net of income tax; and
|
•
|
a favorable change in net investment gains (losses) of $273 million ($177 million, net of income tax) due to higher net gains on sales of real estate, as well as a favorable change in foreign currency transaction gains due to the strengthening of the U.S. dollar.
|
•
|
a $557 million one-time tax charge and a $362 million ($235 million, net of income tax) one-time charge for interest on uncertain tax positions that were recorded under accounting guidance for the recognition of tax uncertainties related to the U.S. tax treatment of taxes paid by a wholly-owned United Kingdom (“UK”) investment subsidiary of Metropolitan Life Insurance Company (“MLIC”); and
|
•
|
a $60 million one-time tax benefit related to restructuring in Chile
.
|
•
|
a $41 million one-time tax charge related to tax reform in Chile.
|
•
|
an unfavorable change in operating earnings available to common shareholders of $869 million, net of income tax;
|
•
|
an unfavorable change in net derivative gains (losses) of $738 million ($480 million, net of income tax) due to unfavorable changes in market and other risks in embedded derivatives; and
|
•
|
a favorable change in net investment gains (losses) of $962 million ($625 million, net of income tax), primarily due to the prior period loss on the disposition of MetLife Assurance Limited (“MAL”). For further information on MAL, see Note 3 of the Notes to the Consolidated Financial Statements in the 2014 Annual Report.
|
•
|
the aforementioned $557 million one-time tax charge and the aforementioned $362 million ($235 million, net of income tax) one-time charge for interest on uncertain tax positions;
|
•
|
a $60 million one-time tax benefit related to restructuring in Chile; and
|
•
|
a $61 million one-time tax benefit in Japan related to a change in tax rate.
|
•
|
charges totaling $57 million, net of income tax, related to a settlement with the New York State Department of Financial Services (the “Department of Financial Services”) and the District Attorney, New York County; and
|
•
|
a $41 million one-time tax charge related to tax reform in Chile.
|
•
|
Growth in premiums, fees and other revenues driven by:
|
-
|
Increases in our businesses outside of the U.S., notably accident & health, from continuing organic growth throughout our various geographic regions and leveraging our multichannel distribution network.
|
•
|
Expanding our presence in emerging markets, including potential merger and acquisition activity. In our 2012 strategic plan, we expected that by 2016, 20% or more of our operating earnings would come from emerging markets, with the acquisition of Administradora de Fondos de Pensiones Provida S.A. (“ProVida”) contributing to this increase. However, due to the strengthening of the U.S. dollar, increased earnings from the favorable U.S. equity markets, and lower than anticipated merger and acquisition activity, we expect to be below the 20% target in 2016.
|
•
|
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.
|
•
|
Expense management in the light of the low interest rate environment, and continued expense control throughout the Company.
|
•
|
Continued disciplined approach to investing and asset/liability management (“ALM”), through our enterprise risk and ALM governance process.
|
•
|
Retail’s operating earnings
increased
(decreased)
by
$86 million
and
$135 million
, net of
($111) million
and
($200) million
of income tax expense (benefit), respectively;
|
•
|
Group, Voluntary & Worksite Benefits’ operating earnings
increased
(decreased)
by
$4 million
and
$10 million
, net of
($2) million
and
$2 million
of income tax expense (benefit), respectively;
|
•
|
Corporate Benefit Funding’s operating earnings
increased
(decreased)
by
($13) million
and
($39) million
, net of
($10) million
and
($32) million
of income tax expense (benefit), respectively;
|
•
|
Latin America’s operating earnings
increased (decreased)
by
($30) million
and
($79) million
, net of
($16) million
and
($46) million
of income tax expense (benefit), respectively;
|
•
|
Asia’s operating earnings
increased
(decreased)
by
$4 million
and
$14 million
, net of
$3 million
and
$5 million
of income tax expense (benefit), respectively;
|
•
|
EMEA’s operating earnings
increased (decreased)
by
($18) million
and
($56) million
, net of
($13) million
and
($31) million
of income tax expense (benefit), respectively; and
|
•
|
Corporate & Other’s operating earnings
increased
(decreased)
by
($33) million
and
$15 million
, net of
$149 million
and
$302 million
of income tax expense (benefit), respectively.
|
(i)
|
liabilities for future policy benefits and the accounting for reinsurance;
|
(ii)
|
capitalization and amortization of deferred policy acquisition costs (“DAC”) and the establishment and amortization of value of business acquired (“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 September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
10,375
|
|
|
$
|
9,703
|
|
|
$
|
28,940
|
|
|
$
|
28,795
|
|
Universal life and investment-type product policy fees
|
2,346
|
|
|
2,628
|
|
|
7,174
|
|
|
7,507
|
|
||||
Net investment income
|
3,959
|
|
|
5,410
|
|
|
14,367
|
|
|
15,704
|
|
||||
Other revenues
|
484
|
|
|
518
|
|
|
1,497
|
|
|
1,486
|
|
||||
Net investment gains (losses)
|
382
|
|
|
109
|
|
|
535
|
|
|
(427
|
)
|
||||
Net derivative gains (losses)
|
485
|
|
|
478
|
|
|
394
|
|
|
1,132
|
|
||||
Total revenues
|
18,031
|
|
|
18,846
|
|
|
52,907
|
|
|
54,197
|
|
||||
Expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
10,688
|
|
|
9,859
|
|
|
29,967
|
|
|
29,871
|
|
||||
Interest credited to policyholder account balances
|
647
|
|
|
1,817
|
|
|
3,940
|
|
|
4,995
|
|
||||
Capitalization of DAC
|
(955
|
)
|
|
(1,071
|
)
|
|
(2,850
|
)
|
|
(3,149
|
)
|
||||
Amortization of DAC and VOBA
|
1,131
|
|
|
1,054
|
|
|
3,053
|
|
|
3,174
|
|
||||
Amortization of negative VOBA
|
(90
|
)
|
|
(107
|
)
|
|
(282
|
)
|
|
(333
|
)
|
||||
Interest expense on debt
|
302
|
|
|
295
|
|
|
908
|
|
|
919
|
|
||||
Other expenses
|
4,145
|
|
|
4,047
|
|
|
11,836
|
|
|
11,992
|
|
||||
Total expenses
|
15,868
|
|
|
15,894
|
|
|
46,572
|
|
|
47,469
|
|
||||
Income (loss) from continuing operations before provision for income tax
|
2,163
|
|
|
2,952
|
|
|
6,335
|
|
|
6,728
|
|
||||
Provision for income tax expense (benefit)
|
965
|
|
|
858
|
|
|
1,855
|
|
|
1,916
|
|
||||
Income (loss) from continuing operations, net of income tax
|
1,198
|
|
|
2,094
|
|
|
4,480
|
|
|
4,812
|
|
||||
Income (loss) from discontinued operations, net of income tax
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||
Net income (loss)
|
1,198
|
|
|
2,094
|
|
|
4,480
|
|
|
4,809
|
|
||||
Less: Net income (loss) attributable to noncontrolling interests
|
(5
|
)
|
|
—
|
|
|
4
|
|
|
21
|
|
||||
Net income (loss) attributable to MetLife, Inc.
|
1,203
|
|
|
2,094
|
|
|
4,476
|
|
|
4,788
|
|
||||
Less: Preferred stock dividends
|
6
|
|
|
30
|
|
|
67
|
|
|
91
|
|
||||
Preferred stock repurchase premium
|
—
|
|
|
—
|
|
|
42
|
|
|
—
|
|
||||
Net income (loss) available to MetLife, Inc.’s common shareholders
|
$
|
1,197
|
|
|
$
|
2,064
|
|
|
$
|
4,367
|
|
|
$
|
4,697
|
|
|
Three Months
Ended September 30, |
||||||
|
2015
|
|
2014
|
||||
|
(In millions)
|
||||||
Non-VA program derivatives
|
|
|
|
||||
Interest rate
|
$
|
723
|
|
|
$
|
82
|
|
Foreign currency exchange rate
|
139
|
|
|
199
|
|
||
Credit
|
(39
|
)
|
|
(8
|
)
|
||
Equity
|
14
|
|
|
(4
|
)
|
||
Non-VA embedded derivatives
|
82
|
|
|
17
|
|
||
Total non-VA program derivatives
|
919
|
|
|
286
|
|
||
VA program derivatives
|
|
|
|
||||
Market risks in embedded derivatives
|
(1,684
|
)
|
|
(119
|
)
|
||
Nonperformance risk adjustment on embedded derivatives
|
253
|
|
|
5
|
|
||
Other risks in embedded derivatives
|
(484
|
)
|
|
32
|
|
||
Total embedded derivatives
|
(1,915
|
)
|
|
(82
|
)
|
||
Freestanding derivatives hedging embedded derivatives
|
1,481
|
|
|
274
|
|
||
Total VA program derivatives
|
(434
|
)
|
|
192
|
|
||
Net derivative gains (losses)
|
$
|
485
|
|
|
$
|
478
|
|
•
|
The cross effect of capital markets changes, which resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
Refinements in the valuation model, which resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
The mismatch of fund performance between actual and modeled funds, which resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
A combination of other factors, including reserve changes influenced by benefit features and policyholder behavior, as well as FCTA, which resulted in an unfavorable period over period change in the valuation of embedded derivatives.
|
•
|
Key equity index levels decreased in the current period and increased in the prior period, contributing to an unfavorable change in our embedded derivatives and a favorable change in our freestanding derivatives. For example, the S&P 500 Index decreased by 7% in the current period and increased by 1% in the prior period.
|
•
|
Long-term interest rates decreased more in the current period than in the prior period, contributing to an unfavorable change in our embedded derivatives and a favorable change in our freestanding derivatives. For example, the 30-year U.S. swap rate decreased by 42 basis points in the current period and decreased by 14 basis points in the prior period.
|
•
|
Changes in foreign currency exchange rates contributed to an unfavorable change in our embedded derivatives and a favorable change in our freestanding derivatives related to the assumed reinsurance of certain variable annuity products from the Company’s former operating joint venture in Japan. For example, the Japanese yen strengthened against the British pound by 6% in the current period as compared with a weakening by 3% against the British pound in the prior period.
|
•
|
Key equity volatility measures generally 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 economic assumptions resulted in an increase of DAC and reserves, resulting in a net charge of $122 million ($79 million, net of income tax).
|
•
|
Changes in policyholder behavior and mortality assumptions resulted in reserve increases, offset by favorable DAC, resulting in a net charge of $91 million ($59 million, net of income tax).
|
•
|
The remaining updates resulted in an increase in reserves, coupled with unfavorable DAC, resulting in a charge of $100 million ($65 million, net of income tax). The most notable update was related to our projection of closed block results.
|
|
Nine Months
Ended September 30, |
||||||
|
2015
|
|
2014
|
||||
|
(In millions)
|
||||||
Non-VA program derivatives
|
|
|
|
||||
Interest rate
|
$
|
506
|
|
|
$
|
502
|
|
Foreign currency exchange rate
|
296
|
|
|
207
|
|
||
Credit
|
(36
|
)
|
|
36
|
|
||
Equity
|
(78
|
)
|
|
(44
|
)
|
||
Non-VA embedded derivatives
|
87
|
|
|
(62
|
)
|
||
Total non-VA program derivatives
|
775
|
|
|
639
|
|
||
VA program derivatives
|
|
|
|
||||
Market risks in embedded derivatives
|
(658
|
)
|
|
235
|
|
||
Nonperformance risk adjustment on embedded derivatives
|
222
|
|
|
(3
|
)
|
||
Other risks in embedded derivatives
|
(690
|
)
|
|
(115
|
)
|
||
Total embedded derivatives
|
(1,126
|
)
|
|
117
|
|
||
Freestanding derivatives hedging embedded derivatives
|
745
|
|
|
376
|
|
||
Total VA program derivatives
|
(381
|
)
|
|
493
|
|
||
Net derivative gains (losses)
|
$
|
394
|
|
|
$
|
1,132
|
|
•
|
Refinements in the valuation model, which resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
The cross effect of capital markets changes, which resulted in an unfavorable period over period change in the valuation of the embedded derivatives.
|
•
|
A combination of other factors, including reserve changes influenced by benefit features and policyholder behavior, as well as FCTA, which resulted in an unfavorable period over period change in the valuation of embedded derivatives.
|
•
|
Key equity index levels decreased more in the current period than in the prior period, contributing to an unfavorable change in our embedded derivatives and a favorable change in our freestanding derivatives. For example, the Russell 2000 Index decreased by 9% in the current period and decreased by 5% in the prior period.
|
•
|
Key equity volatility measures generally increased in the current period and decreased in the prior period, contributing to an unfavorable change in our embedded derivatives and a favorable change in our freestanding derivatives.
|
•
|
Changes in foreign currency exchange rates contributed to an unfavorable change in our embedded derivatives and a favorable change in our freestanding derivatives related to the assumed reinsurance of certain variable annuity products from the Company’s former operating joint venture in Japan. For example, the Japanese yen strengthened against the euro by 8% in the current period as compared with a strengthening by 4% against the euro in the prior period.
|
•
|
Long-term interest rates decreased less 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. For example, the 30-year U.S. swap rate decreased by 18 basis points in the current period and decreased by 74 basis points in the prior period.
|
|
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
|
$
|
362
|
|
|
$
|
386
|
|
|
$
|
476
|
|
|
$
|
78
|
|
|
$
|
655
|
|
|
$
|
85
|
|
|
$
|
(844
|
)
|
|
$
|
1,198
|
|
Less: Net investment gains (losses)
|
70
|
|
|
11
|
|
|
139
|
|
|
9
|
|
|
325
|
|
|
14
|
|
|
(186
|
)
|
|
382
|
|
||||||||
Less: Net derivative gains (losses)
|
(282
|
)
|
|
259
|
|
|
127
|
|
|
(108
|
)
|
|
107
|
|
|
7
|
|
|
375
|
|
|
485
|
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(35
|
)
|
|
(42
|
)
|
|
(37
|
)
|
|
(32
|
)
|
|
(21
|
)
|
|
(14
|
)
|
|
(25
|
)
|
|
(206
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
86
|
|
|
(80
|
)
|
|
(79
|
)
|
|
33
|
|
|
(94
|
)
|
|
12
|
|
|
(52
|
)
|
|
(174
|
)
|
||||||||
Operating earnings
|
$
|
523
|
|
|
$
|
238
|
|
|
$
|
326
|
|
|
$
|
176
|
|
|
$
|
338
|
|
|
$
|
66
|
|
|
(956
|
)
|
|
711
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
6
|
|
|
6
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(962
|
)
|
|
$
|
705
|
|
|
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
|
$
|
909
|
|
|
$
|
278
|
|
|
$
|
509
|
|
|
$
|
119
|
|
|
$
|
338
|
|
|
$
|
77
|
|
|
$
|
(136
|
)
|
|
$
|
2,094
|
|
Less: Net investment gains (losses)
|
9
|
|
|
(9
|
)
|
|
180
|
|
|
(4
|
)
|
|
136
|
|
|
(9
|
)
|
|
(194
|
)
|
|
109
|
|
||||||||
Less: Net derivative gains (losses)
|
283
|
|
|
106
|
|
|
28
|
|
|
(61
|
)
|
|
(80
|
)
|
|
16
|
|
|
186
|
|
|
478
|
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(100
|
)
|
|
(41
|
)
|
|
(31
|
)
|
|
87
|
|
|
(32
|
)
|
|
1
|
|
|
(30
|
)
|
|
(146
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
(68
|
)
|
|
(19
|
)
|
|
(63
|
)
|
|
(25
|
)
|
|
4
|
|
|
(9
|
)
|
|
(22
|
)
|
|
(202
|
)
|
||||||||
Operating earnings
|
$
|
785
|
|
|
$
|
241
|
|
|
$
|
395
|
|
|
$
|
122
|
|
|
$
|
310
|
|
|
$
|
78
|
|
|
(76
|
)
|
|
1,855
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
30
|
|
|
30
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(106
|
)
|
|
$
|
1,825
|
|
(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
|
$
|
1,725
|
|
|
$
|
760
|
|
|
$
|
1,312
|
|
|
$
|
282
|
|
|
$
|
1,568
|
|
|
$
|
215
|
|
|
$
|
(1,382
|
)
|
|
$
|
4,480
|
|
Less: Net investment gains (losses)
|
147
|
|
|
22
|
|
|
313
|
|
|
7
|
|
|
450
|
|
|
22
|
|
|
(426
|
)
|
|
535
|
|
||||||||
Less: Net derivative gains (losses)
|
(64
|
)
|
|
200
|
|
|
73
|
|
|
(144
|
)
|
|
134
|
|
|
21
|
|
|
174
|
|
|
394
|
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(299
|
)
|
|
(125
|
)
|
|
(63
|
)
|
|
(51
|
)
|
|
(113
|
)
|
|
(7
|
)
|
|
(35
|
)
|
|
(693
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
75
|
|
|
(34
|
)
|
|
(112
|
)
|
|
47
|
|
|
7
|
|
|
(7
|
)
|
|
93
|
|
|
69
|
|
||||||||
Operating earnings
|
$
|
1,866
|
|
|
$
|
697
|
|
|
$
|
1,101
|
|
|
$
|
423
|
|
|
$
|
1,090
|
|
|
$
|
186
|
|
|
(1,188
|
)
|
|
4,175
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
67
|
|
|
67
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(1,255
|
)
|
|
$
|
4,108
|
|
|
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
|
$
|
2,152
|
|
|
$
|
745
|
|
|
$
|
852
|
|
|
$
|
256
|
|
|
$
|
1,106
|
|
|
$
|
279
|
|
|
$
|
(578
|
)
|
|
$
|
4,812
|
|
Less: Net investment gains (losses)
|
25
|
|
|
(10
|
)
|
|
(556
|
)
|
|
11
|
|
|
375
|
|
|
(16
|
)
|
|
(256
|
)
|
|
(427
|
)
|
||||||||
Less: Net derivative gains (losses)
|
579
|
|
|
293
|
|
|
256
|
|
|
(57
|
)
|
|
(122
|
)
|
|
103
|
|
|
80
|
|
|
1,132
|
|
||||||||
Less: Other adjustments to continuing operations (1)
|
(521
|
)
|
|
(122
|
)
|
|
(55
|
)
|
|
(146
|
)
|
|
(50
|
)
|
|
31
|
|
|
(60
|
)
|
|
(923
|
)
|
||||||||
Less: Provision for income tax (expense) benefit
|
(29
|
)
|
|
(56
|
)
|
|
109
|
|
|
32
|
|
|
(64
|
)
|
|
(60
|
)
|
|
30
|
|
|
(38
|
)
|
||||||||
Operating earnings
|
$
|
2,098
|
|
|
$
|
640
|
|
|
$
|
1,098
|
|
|
$
|
416
|
|
|
$
|
967
|
|
|
$
|
221
|
|
|
(372
|
)
|
|
5,068
|
|
||
Less: Preferred stock dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
91
|
|
|
91
|
|
||||||||||||||
Operating earnings available to common shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(463
|
)
|
|
$
|
4,977
|
|
(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
|
$
|
4,983
|
|
|
$
|
5,106
|
|
|
$
|
3,312
|
|
|
$
|
1,109
|
|
|
$
|
3,043
|
|
|
$
|
206
|
|
|
$
|
272
|
|
|
$
|
18,031
|
|
Less: Net investment gains (losses)
|
70
|
|
|
11
|
|
|
139
|
|
|
9
|
|
|
325
|
|
|
14
|
|
|
(186
|
)
|
|
382
|
|
||||||||
Less: Net derivative gains (losses)
|
(282
|
)
|
|
259
|
|
|
127
|
|
|
(108
|
)
|
|
107
|
|
|
7
|
|
|
375
|
|
|
485
|
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
1
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(12
|
)
|
|
(42
|
)
|
|
(25
|
)
|
|
(11
|
)
|
|
(205
|
)
|
|
(513
|
)
|
|
4
|
|
|
(804
|
)
|
||||||||
Total operating revenues
|
$
|
5,206
|
|
|
$
|
4,878
|
|
|
$
|
3,071
|
|
|
$
|
1,219
|
|
|
$
|
2,814
|
|
|
$
|
700
|
|
|
$
|
79
|
|
|
$
|
17,967
|
|
Total expenses
|
$
|
4,543
|
|
|
$
|
4,509
|
|
|
$
|
2,580
|
|
|
$
|
1,101
|
|
|
$
|
2,169
|
|
|
$
|
126
|
|
|
$
|
840
|
|
|
$
|
15,868
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
41
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
41
|
|
||||||||
Less: Other adjustments to expenses (1)
|
(17
|
)
|
|
—
|
|
|
12
|
|
|
21
|
|
|
(184
|
)
|
|
(499
|
)
|
|
29
|
|
|
(638
|
)
|
||||||||
Total operating expenses
|
$
|
4,519
|
|
|
$
|
4,509
|
|
|
$
|
2,568
|
|
|
$
|
1,080
|
|
|
$
|
2,351
|
|
|
$
|
627
|
|
|
$
|
811
|
|
|
$
|
16,465
|
|
|
Retail
|
|
Group,
Voluntary
& Worksite
Benefits
|
|
Corporate
Benefit
Funding
|
|
Latin
America
|
|
Asia
|
|
EMEA
|
|
Corporate
& Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Total revenues
|
$
|
5,699
|
|
|
$
|
4,824
|
|
|
$
|
2,239
|
|
|
$
|
1,414
|
|
|
$
|
3,399
|
|
|
$
|
1,085
|
|
|
$
|
186
|
|
|
$
|
18,846
|
|
Less: Net investment gains (losses)
|
9
|
|
|
(9
|
)
|
|
180
|
|
|
(4
|
)
|
|
136
|
|
|
(9
|
)
|
|
(194
|
)
|
|
109
|
|
||||||||
Less: Net derivative gains (losses)
|
283
|
|
|
106
|
|
|
28
|
|
|
(61
|
)
|
|
(80
|
)
|
|
16
|
|
|
186
|
|
|
478
|
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
1
|
|
|
—
|
|
|
8
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(13
|
)
|
|
(41
|
)
|
|
(15
|
)
|
|
15
|
|
|
145
|
|
|
238
|
|
|
4
|
|
|
333
|
|
||||||||
Total operating revenues
|
$
|
5,420
|
|
|
$
|
4,768
|
|
|
$
|
2,046
|
|
|
$
|
1,464
|
|
|
$
|
3,191
|
|
|
$
|
839
|
|
|
$
|
190
|
|
|
$
|
17,918
|
|
Total expenses
|
$
|
4,467
|
|
|
$
|
4,402
|
|
|
$
|
1,457
|
|
|
$
|
1,200
|
|
|
$
|
2,911
|
|
|
$
|
976
|
|
|
$
|
481
|
|
|
$
|
15,894
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(28
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
2
|
|
|
—
|
|
|
(27
|
)
|
||||||||
Less: Other adjustments to expenses (1)
|
115
|
|
|
—
|
|
|
16
|
|
|
(72
|
)
|
|
185
|
|
|
236
|
|
|
34
|
|
|
514
|
|
||||||||
Total operating expenses
|
$
|
4,380
|
|
|
$
|
4,402
|
|
|
$
|
1,441
|
|
|
$
|
1,272
|
|
|
$
|
2,727
|
|
|
$
|
738
|
|
|
$
|
447
|
|
|
$
|
15,407
|
|
(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
|
$
|
15,714
|
|
|
$
|
14,753
|
|
|
$
|
7,335
|
|
|
$
|
3,684
|
|
|
$
|
9,267
|
|
|
$
|
1,953
|
|
|
$
|
201
|
|
|
$
|
52,907
|
|
Less: Net investment gains (losses)
|
147
|
|
|
22
|
|
|
313
|
|
|
7
|
|
|
450
|
|
|
22
|
|
|
(426
|
)
|
|
535
|
|
||||||||
Less: Net derivative gains (losses)
|
(64
|
)
|
|
200
|
|
|
73
|
|
|
(144
|
)
|
|
134
|
|
|
21
|
|
|
174
|
|
|
394
|
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12
|
|
|
(4
|
)
|
|
—
|
|
|
8
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(56
|
)
|
|
(125
|
)
|
|
(76
|
)
|
|
7
|
|
|
80
|
|
|
(231
|
)
|
|
12
|
|
|
(389
|
)
|
||||||||
Total operating revenues
|
$
|
15,687
|
|
|
$
|
14,656
|
|
|
$
|
7,025
|
|
|
$
|
3,814
|
|
|
$
|
8,591
|
|
|
$
|
2,145
|
|
|
$
|
441
|
|
|
$
|
52,359
|
|
Total expenses
|
$
|
13,343
|
|
|
$
|
13,577
|
|
|
$
|
5,323
|
|
|
$
|
3,434
|
|
|
$
|
7,374
|
|
|
$
|
1,706
|
|
|
$
|
1,815
|
|
|
$
|
46,572
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
37
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
(4
|
)
|
|
—
|
|
|
42
|
|
||||||||
Less: Other adjustments to expenses (1)
|
206
|
|
|
—
|
|
|
(13
|
)
|
|
58
|
|
|
196
|
|
|
(224
|
)
|
|
47
|
|
|
270
|
|
||||||||
Total operating expenses
|
$
|
13,100
|
|
|
$
|
13,577
|
|
|
$
|
5,336
|
|
|
$
|
3,376
|
|
|
$
|
7,169
|
|
|
$
|
1,934
|
|
|
$
|
1,768
|
|
|
$
|
46,260
|
|
|
Retail
|
|
Group, Voluntary & Worksite Benefits
|
|
Corporate Benefit Funding
|
|
Latin America
|
|
Asia
|
|
EMEA
|
|
Corporate & Other
|
|
Total
|
||||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||||||
Total revenues
|
$
|
16,455
|
|
|
$
|
14,459
|
|
|
$
|
5,822
|
|
|
$
|
4,180
|
|
|
$
|
9,614
|
|
|
$
|
3,206
|
|
|
$
|
461
|
|
|
$
|
54,197
|
|
Less: Net investment gains (losses)
|
25
|
|
|
(10
|
)
|
|
(556
|
)
|
|
11
|
|
|
375
|
|
|
(16
|
)
|
|
(256
|
)
|
|
(427
|
)
|
||||||||
Less: Net derivative gains (losses)
|
579
|
|
|
293
|
|
|
256
|
|
|
(57
|
)
|
|
(122
|
)
|
|
103
|
|
|
80
|
|
|
1,132
|
|
||||||||
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
7
|
|
|
—
|
|
|
14
|
|
||||||||
Less: Other adjustments to revenues (1)
|
(58
|
)
|
|
(122
|
)
|
|
39
|
|
|
39
|
|
|
95
|
|
|
620
|
|
|
30
|
|
|
643
|
|
||||||||
Total operating revenues
|
$
|
15,910
|
|
|
$
|
14,298
|
|
|
$
|
6,083
|
|
|
$
|
4,187
|
|
|
$
|
9,258
|
|
|
$
|
2,492
|
|
|
$
|
607
|
|
|
$
|
52,835
|
|
Total expenses
|
$
|
13,450
|
|
|
$
|
13,318
|
|
|
$
|
4,500
|
|
|
$
|
3,846
|
|
|
$
|
8,014
|
|
|
$
|
2,818
|
|
|
$
|
1,523
|
|
|
$
|
47,469
|
|
Less: Adjustments related to net investment gains (losses) and net derivative gains (losses)
|
33
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
9
|
|
|
—
|
|
|
37
|
|
||||||||
Less: Other adjustments to expenses (1)
|
429
|
|
|
—
|
|
|
94
|
|
|
185
|
|
|
158
|
|
|
587
|
|
|
90
|
|
|
1,543
|
|
||||||||
Total operating expenses
|
$
|
12,988
|
|
|
$
|
13,318
|
|
|
$
|
4,406
|
|
|
$
|
3,661
|
|
|
$
|
7,861
|
|
|
$
|
2,222
|
|
|
$
|
1,433
|
|
|
$
|
45,889
|
|
(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 September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
10,376
|
|
|
$
|
9,685
|
|
|
$
|
28,942
|
|
|
$
|
28,755
|
|
Universal life and investment-type product policy fees
|
2,247
|
|
|
2,522
|
|
|
6,876
|
|
|
7,205
|
|
||||
Net investment income
|
4,849
|
|
|
5,193
|
|
|
15,016
|
|
|
15,373
|
|
||||
Other revenues
|
495
|
|
|
518
|
|
|
1,525
|
|
|
1,502
|
|
||||
Total operating revenues
|
17,967
|
|
|
17,918
|
|
|
52,359
|
|
|
52,835
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
10,780
|
|
|
9,854
|
|
|
29,730
|
|
|
29,191
|
|
||||
Interest credited to policyholder account balances
|
1,331
|
|
|
1,426
|
|
|
4,004
|
|
|
4,252
|
|
||||
Capitalization of DAC
|
(955
|
)
|
|
(1,071
|
)
|
|
(2,850
|
)
|
|
(3,148
|
)
|
||||
Amortization of DAC and VOBA
|
971
|
|
|
999
|
|
|
2,925
|
|
|
3,074
|
|
||||
Amortization of negative VOBA
|
(82
|
)
|
|
(96
|
)
|
|
(255
|
)
|
|
(298
|
)
|
||||
Interest expense on debt
|
294
|
|
|
292
|
|
|
898
|
|
|
885
|
|
||||
Other expenses
|
4,126
|
|
|
4,003
|
|
|
11,808
|
|
|
11,933
|
|
||||
Total operating expenses
|
16,465
|
|
|
15,407
|
|
|
46,260
|
|
|
45,889
|
|
||||
Provision for income tax expense (benefit)
|
791
|
|
|
656
|
|
|
1,924
|
|
|
1,878
|
|
||||
Operating earnings
|
711
|
|
|
1,855
|
|
|
4,175
|
|
|
5,068
|
|
||||
Less: Preferred stock dividends
|
6
|
|
|
30
|
|
|
67
|
|
|
91
|
|
||||
Operating earnings available to common shareholders
|
$
|
705
|
|
|
$
|
1,825
|
|
|
$
|
4,108
|
|
|
$
|
4,977
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
1,806
|
|
|
$
|
1,869
|
|
|
$
|
5,302
|
|
|
$
|
5,405
|
|
Universal life and investment-type product policy fees
|
1,229
|
|
|
1,311
|
|
|
3,717
|
|
|
3,814
|
|
||||
Net investment income
|
1,930
|
|
|
1,965
|
|
|
5,913
|
|
|
5,906
|
|
||||
Other revenues
|
241
|
|
|
275
|
|
|
755
|
|
|
785
|
|
||||
Total operating revenues
|
5,206
|
|
|
5,420
|
|
|
15,687
|
|
|
15,910
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
2,607
|
|
|
2,555
|
|
|
7,429
|
|
|
7,400
|
|
||||
Interest credited to policyholder account balances
|
550
|
|
|
567
|
|
|
1,643
|
|
|
1,683
|
|
||||
Capitalization of DAC
|
(266
|
)
|
|
(239
|
)
|
|
(770
|
)
|
|
(722
|
)
|
||||
Amortization of DAC and VOBA
|
432
|
|
|
335
|
|
|
1,207
|
|
|
1,142
|
|
||||
Interest expense on debt
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
(1
|
)
|
||||
Other expenses
|
1,197
|
|
|
1,163
|
|
|
3,593
|
|
|
3,486
|
|
||||
Total operating expenses
|
4,519
|
|
|
4,380
|
|
|
13,100
|
|
|
12,988
|
|
||||
Provision for income tax expense (benefit)
|
164
|
|
|
255
|
|
|
721
|
|
|
824
|
|
||||
Operating earnings
|
$
|
523
|
|
|
$
|
785
|
|
|
$
|
1,866
|
|
|
$
|
2,098
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
4,092
|
|
|
$
|
4,010
|
|
|
$
|
12,313
|
|
|
$
|
12,050
|
|
Universal life and investment-type product policy fees
|
188
|
|
|
180
|
|
|
559
|
|
|
538
|
|
||||
Net investment income
|
485
|
|
|
475
|
|
|
1,444
|
|
|
1,396
|
|
||||
Other revenues
|
113
|
|
|
103
|
|
|
340
|
|
|
314
|
|
||||
Total operating revenues
|
4,878
|
|
|
4,768
|
|
|
14,656
|
|
|
14,298
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
3,805
|
|
|
3,729
|
|
|
11,445
|
|
|
11,299
|
|
||||
Interest credited to policyholder account balances
|
39
|
|
|
38
|
|
|
114
|
|
|
117
|
|
||||
Capitalization of DAC
|
(41
|
)
|
|
(37
|
)
|
|
(113
|
)
|
|
(107
|
)
|
||||
Amortization of DAC and VOBA
|
40
|
|
|
38
|
|
|
120
|
|
|
109
|
|
||||
Other expenses
|
666
|
|
|
634
|
|
|
2,011
|
|
|
1,900
|
|
||||
Total operating expenses
|
4,509
|
|
|
4,402
|
|
|
13,577
|
|
|
13,318
|
|
||||
Provision for income tax expense (benefit)
|
131
|
|
|
125
|
|
|
382
|
|
|
340
|
|
||||
Operating earnings
|
$
|
238
|
|
|
$
|
241
|
|
|
$
|
697
|
|
|
$
|
640
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
1,555
|
|
|
$
|
451
|
|
|
$
|
2,292
|
|
|
$
|
1,438
|
|
Universal life and investment-type product policy fees
|
55
|
|
|
60
|
|
|
168
|
|
|
172
|
|
||||
Net investment income
|
1,391
|
|
|
1,464
|
|
|
4,347
|
|
|
4,259
|
|
||||
Other revenues
|
70
|
|
|
71
|
|
|
218
|
|
|
214
|
|
||||
Total operating revenues
|
3,071
|
|
|
2,046
|
|
|
7,025
|
|
|
6,083
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
2,154
|
|
|
1,033
|
|
|
4,078
|
|
|
3,194
|
|
||||
Interest credited to policyholder account balances
|
295
|
|
|
279
|
|
|
882
|
|
|
844
|
|
||||
Capitalization of DAC
|
(1
|
)
|
|
(11
|
)
|
|
(11
|
)
|
|
(30
|
)
|
||||
Amortization of DAC and VOBA
|
6
|
|
|
5
|
|
|
17
|
|
|
15
|
|
||||
Interest expense on debt
|
1
|
|
|
2
|
|
|
3
|
|
|
6
|
|
||||
Other expenses
|
113
|
|
|
133
|
|
|
367
|
|
|
377
|
|
||||
Total operating expenses
|
2,568
|
|
|
1,441
|
|
|
5,336
|
|
|
4,406
|
|
||||
Provision for income tax expense (benefit)
|
177
|
|
|
210
|
|
|
588
|
|
|
579
|
|
||||
Operating earnings
|
$
|
326
|
|
|
$
|
395
|
|
|
$
|
1,101
|
|
|
$
|
1,098
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
668
|
|
|
$
|
812
|
|
|
$
|
2,150
|
|
|
$
|
2,293
|
|
Universal life and investment-type product policy fees
|
261
|
|
|
328
|
|
|
856
|
|
|
956
|
|
||||
Net investment income
|
279
|
|
|
317
|
|
|
780
|
|
|
915
|
|
||||
Other revenues
|
11
|
|
|
7
|
|
|
28
|
|
|
23
|
|
||||
Total operating revenues
|
1,219
|
|
|
1,464
|
|
|
3,814
|
|
|
4,187
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
630
|
|
|
735
|
|
|
1,955
|
|
|
2,100
|
|
||||
Interest credited to policyholder account balances
|
88
|
|
|
97
|
|
|
263
|
|
|
295
|
|
||||
Capitalization of DAC
|
(105
|
)
|
|
(112
|
)
|
|
(316
|
)
|
|
(320
|
)
|
||||
Amortization of DAC and VOBA
|
57
|
|
|
102
|
|
|
221
|
|
|
265
|
|
||||
Amortization of negative VOBA
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Other expenses
|
410
|
|
|
450
|
|
|
1,254
|
|
|
1,322
|
|
||||
Total operating expenses
|
1,080
|
|
|
1,272
|
|
|
3,376
|
|
|
3,661
|
|
||||
Provision for income tax expense (benefit)
|
(37
|
)
|
|
70
|
|
|
15
|
|
|
110
|
|
||||
Operating earnings
|
$
|
176
|
|
|
$
|
122
|
|
|
$
|
423
|
|
|
$
|
416
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
1,736
|
|
|
$
|
1,939
|
|
|
$
|
5,297
|
|
|
$
|
5,742
|
|
Universal life and investment-type product policy fees
|
382
|
|
|
487
|
|
|
1,179
|
|
|
1,276
|
|
||||
Net investment income
|
670
|
|
|
738
|
|
|
2,033
|
|
|
2,162
|
|
||||
Other revenues
|
26
|
|
|
27
|
|
|
82
|
|
|
78
|
|
||||
Total operating revenues
|
2,814
|
|
|
3,191
|
|
|
8,591
|
|
|
9,258
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
1,331
|
|
|
1,535
|
|
|
4,046
|
|
|
4,357
|
|
||||
Interest credited to policyholder account balances
|
327
|
|
|
394
|
|
|
992
|
|
|
1,175
|
|
||||
Capitalization of DAC
|
(435
|
)
|
|
(507
|
)
|
|
(1,268
|
)
|
|
(1,458
|
)
|
||||
Amortization of DAC and VOBA
|
309
|
|
|
367
|
|
|
971
|
|
|
1,067
|
|
||||
Amortization of negative VOBA
|
(77
|
)
|
|
(89
|
)
|
|
(241
|
)
|
|
(275
|
)
|
||||
Other expenses
|
896
|
|
|
1,027
|
|
|
2,669
|
|
|
2,995
|
|
||||
Total operating expenses
|
2,351
|
|
|
2,727
|
|
|
7,169
|
|
|
7,861
|
|
||||
Provision for income tax expense (benefit)
|
125
|
|
|
154
|
|
|
332
|
|
|
430
|
|
||||
Operating earnings
|
$
|
338
|
|
|
$
|
310
|
|
|
$
|
1,090
|
|
|
$
|
967
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
501
|
|
|
$
|
581
|
|
|
$
|
1,534
|
|
|
$
|
1,762
|
|
Universal life and investment-type product policy fees
|
106
|
|
|
127
|
|
|
322
|
|
|
353
|
|
||||
Net investment income
|
82
|
|
|
109
|
|
|
249
|
|
|
328
|
|
||||
Other revenues
|
11
|
|
|
22
|
|
|
40
|
|
|
49
|
|
||||
Total operating revenues
|
700
|
|
|
839
|
|
|
2,145
|
|
|
2,492
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
233
|
|
|
252
|
|
|
737
|
|
|
784
|
|
||||
Interest credited to policyholder account balances
|
27
|
|
|
43
|
|
|
91
|
|
|
112
|
|
||||
Capitalization of DAC
|
(107
|
)
|
|
(165
|
)
|
|
(372
|
)
|
|
(511
|
)
|
||||
Amortization of DAC and VOBA
|
127
|
|
|
152
|
|
|
388
|
|
|
476
|
|
||||
Amortization of negative VOBA
|
(5
|
)
|
|
(7
|
)
|
|
(13
|
)
|
|
(22
|
)
|
||||
Other expenses
|
352
|
|
|
463
|
|
|
1,103
|
|
|
1,383
|
|
||||
Total operating expenses
|
627
|
|
|
738
|
|
|
1,934
|
|
|
2,222
|
|
||||
Provision for income tax expense (benefit)
|
7
|
|
|
23
|
|
|
25
|
|
|
49
|
|
||||
Operating earnings
|
$
|
66
|
|
|
$
|
78
|
|
|
$
|
186
|
|
|
$
|
221
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Operating revenues
|
|
|
|
|
|
|
|
||||||||
Premiums
|
$
|
18
|
|
|
$
|
23
|
|
|
$
|
54
|
|
|
$
|
65
|
|
Universal life and investment-type product policy fees
|
26
|
|
|
29
|
|
|
75
|
|
|
96
|
|
||||
Net investment income
|
12
|
|
|
125
|
|
|
250
|
|
|
407
|
|
||||
Other revenues
|
23
|
|
|
13
|
|
|
62
|
|
|
39
|
|
||||
Total operating revenues
|
79
|
|
|
190
|
|
|
441
|
|
|
607
|
|
||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Policyholder benefits and claims and policyholder dividends
|
20
|
|
|
15
|
|
|
40
|
|
|
57
|
|
||||
Interest credited to policyholder account balances
|
5
|
|
|
8
|
|
|
19
|
|
|
26
|
|
||||
Amortization of DAC and VOBA
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Interest expense on debt
|
294
|
|
|
291
|
|
|
897
|
|
|
880
|
|
||||
Other expenses
|
492
|
|
|
133
|
|
|
811
|
|
|
470
|
|
||||
Total operating expenses
|
811
|
|
|
447
|
|
|
1,768
|
|
|
1,433
|
|
||||
Provision for income tax expense (benefit)
|
224
|
|
|
(181
|
)
|
|
(139
|
)
|
|
(454
|
)
|
||||
Operating earnings
|
(956
|
)
|
|
(76
|
)
|
|
(1,188
|
)
|
|
(372
|
)
|
||||
Less: Preferred stock dividends
|
6
|
|
|
30
|
|
|
67
|
|
|
91
|
|
||||
Operating earnings available to common shareholders
|
$
|
(962
|
)
|
|
$
|
(106
|
)
|
|
$
|
(1,255
|
)
|
|
$
|
(463
|
)
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Other business activities
|
$
|
5
|
|
|
$
|
21
|
|
|
$
|
29
|
|
|
$
|
56
|
|
Other net investment income
|
16
|
|
|
88
|
|
|
170
|
|
|
271
|
|
||||
Interest expense on debt
|
(191
|
)
|
|
(189
|
)
|
|
(583
|
)
|
|
(572
|
)
|
||||
Preferred stock dividends
|
(6
|
)
|
|
(30
|
)
|
|
(67
|
)
|
|
(91
|
)
|
||||
Acquisition costs
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
||||
Corporate initiatives and projects
|
(45
|
)
|
|
(43
|
)
|
|
(142
|
)
|
|
(114
|
)
|
||||
Incremental tax benefit (expense)
|
(480
|
)
|
|
91
|
|
|
(325
|
)
|
|
164
|
|
||||
Other
|
(261
|
)
|
|
(44
|
)
|
|
(337
|
)
|
|
(172
|
)
|
||||
Operating earnings available to common shareholders
|
$
|
(962
|
)
|
|
$
|
(106
|
)
|
|
$
|
(1,255
|
)
|
|
$
|
(463
|
)
|
•
|
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.
|
|
At or For the Three Months Ended September 30,
|
|
At or For the Nine Months Ended September 30,
|
||||||||||||||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||||||||||||||
|
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)
|
4.55
|
|
%
|
$
|
3,467
|
|
|
4.73
|
|
%
|
$
|
3,704
|
|
|
4.66
|
|
%
|
$
|
10,701
|
|
|
4.80
|
|
%
|
$
|
11,185
|
|
Mortgage loans (3)
|
4.95
|
|
%
|
785
|
|
|
5.44
|
|
%
|
774
|
|
|
4.95
|
|
%
|
2,316
|
|
|
5.19
|
|
%
|
2,191
|
|
||||
Real estate and real estate joint ventures
|
3.99
|
|
%
|
101
|
|
|
3.69
|
|
%
|
94
|
|
|
4.83
|
|
%
|
371
|
|
|
3.88
|
|
%
|
297
|
|
||||
Policy loans
|
5.09
|
|
%
|
147
|
|
|
5.37
|
|
%
|
158
|
|
|
5.18
|
|
%
|
450
|
|
|
5.36
|
|
%
|
473
|
|
||||
Equity securities
|
4.66
|
|
%
|
36
|
|
|
3.95
|
|
%
|
31
|
|
|
4.42
|
|
%
|
102
|
|
|
4.18
|
|
%
|
98
|
|
||||
Other limited partnerships
|
10.82
|
|
%
|
216
|
|
|
14.77
|
|
%
|
299
|
|
|
11.27
|
|
%
|
681
|
|
|
14.14
|
|
%
|
834
|
|
||||
Cash and short-term investments
|
0.74
|
|
%
|
23
|
|
|
1.06
|
|
%
|
40
|
|
|
0.93
|
|
%
|
89
|
|
|
1.09
|
|
%
|
124
|
|
||||
Other invested assets
|
|
|
|
225
|
|
|
|
|
|
233
|
|
|
|
|
775
|
|
|
|
|
653
|
|
||||||
Total before investment fees and expenses
|
4.76
|
|
%
|
5,000
|
|
|
5.03
|
|
%
|
5,333
|
|
|
4.91
|
|
%
|
15,485
|
|
|
5.02
|
|
%
|
15,855
|
|
||||
Investment fees and expenses
|
(0.14
|
)
|
|
(151
|
)
|
|
(0.13
|
)
|
|
(137
|
)
|
|
(0.15
|
)
|
|
(469
|
)
|
|
(0.13
|
)
|
|
(412
|
)
|
||||
Net investment income including divested businesses (4), (5)
|
4.62
|
|
%
|
4,849
|
|
|
4.90
|
|
%
|
5,196
|
|
|
4.76
|
|
%
|
15,016
|
|
|
4.89
|
|
%
|
15,443
|
|
||||
Less: net investment income from divested businesses (4), (5)
|
|
|
—
|
|
|
|
|
3
|
|
|
|
|
—
|
|
|
|
|
70
|
|
||||||||
Net investment income (5)
|
|
|
$
|
4,849
|
|
|
|
|
$
|
5,193
|
|
|
|
|
$
|
15,016
|
|
|
|
|
$
|
15,373
|
|
(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 (5) 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
($35) million
and
$4 million
for the
three months
and
nine months ended
September 30, 2015
, respectively, and
$14 million
and
$95 million
for the
three months
and
nine months ended
September 30, 2014
, 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
nine months ended
September 30, 2014
was
$3 million
and
$70 million
, 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
$0
and
$1 million
for the
three months
and
nine months ended
September 30, 2014
, respectively. There were no net investment income adjustments for divested businesses or excluded scheduled periodic settlement payments on derivatives for the
three months
and
nine months ended
September 30, 2015
.
|
(5)
|
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 September 30, |
|
Nine Months
Ended September 30, |
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(In millions)
|
||||||||||||||
Net investment income — in the above yield table
|
$
|
4,849
|
|
|
$
|
5,193
|
|
|
$
|
15,016
|
|
|
$
|
15,373
|
|
Real estate discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||
Scheduled periodic settlement payments on derivatives not qualifying for hedge accounting
|
(194
|
)
|
|
(169
|
)
|
|
(574
|
)
|
|
(513
|
)
|
||||
Contractholder-directed unit-linked investments
|
(701
|
)
|
|
379
|
|
|
(79
|
)
|
|
739
|
|
||||
Divested businesses
|
—
|
|
|
3
|
|
|
—
|
|
|
70
|
|
||||
Operating joint venture adjustments
|
(3
|
)
|
|
1
|
|
|
(6
|
)
|
|
2
|
|
||||
Incremental net investment income from CSEs
|
8
|
|
|
3
|
|
|
10
|
|
|
34
|
|
||||
Net investment income — GAAP consolidated statements of operations
|
$
|
3,959
|
|
|
$
|
5,410
|
|
|
$
|
14,367
|
|
|
$
|
15,704
|
|
|
September 30, 2015
|
|
December 31, 2014
|
|
||||||||
|
Estimated Fair Value
|
|
% of Total
|
|
Estimated Fair Value
|
|
% of Total
|
|
||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
|
||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
||||
Publicly-traded
|
$
|
303,052
|
|
|
86.2
|
%
|
$
|
315,167
|
|
|
86.2
|
%
|
Privately-placed
|
48,526
|
|
|
13.8
|
|
50,258
|
|
|
13.8
|
|
||
Total fixed maturity securities
|
$
|
351,578
|
|
|
100.0
|
%
|
$
|
365,425
|
|
|
100.0
|
%
|
Percentage of cash and invested assets
|
68.7
|
%
|
|
|
|
70.7
|
%
|
|
|
|
||
Equity securities
|
|
|
|
|
|
|
|
|
||||
Publicly-traded
|
$
|
2,277
|
|
|
67.0
|
%
|
$
|
2,569
|
|
|
70.8
|
%
|
Privately-held
|
1,122
|
|
|
33.0
|
|
1,062
|
|
|
29.2
|
|
||
Total equity securities
|
$
|
3,399
|
|
|
100.0
|
%
|
$
|
3,631
|
|
|
100.0
|
%
|
Percentage of cash and invested assets
|
0.7
|
%
|
|
|
|
0.7
|
%
|
|
|
|
||
Perpetual securities included within fixed maturity and equity securities AFS
|
$
|
865
|
|
|
|
|
$
|
1,009
|
|
|
|
|
Redeemable preferred stock with a stated maturity included within fixed maturity securities AFS
|
$
|
982
|
|
|
|
|
$
|
1,265
|
|
|
|
|
|
September 30, 2015
|
||||||||||||
|
Fixed Maturity
Securities
|
|
|
Equity
Securities
|
|||||||||
|
(In millions)
|
|
|
|
|
(In millions)
|
|
|
|
||||
Level 1
|
|
|
|
|
|
|
|
|
|
||||
Quoted prices in active markets for identical assets
|
$
|
34,117
|
|
|
9.7
|
%
|
|
$
|
1,347
|
|
|
39.6
|
%
|
Level 2
|
|
|
|
|
|
|
|
|
|
||||
Independent pricing source
|
260,746
|
|
|
74.1
|
|
|
1,459
|
|
|
42.9
|
|
||
Internal matrix pricing or discounted cash flow techniques
|
34,726
|
|
|
9.9
|
|
|
143
|
|
|
4.2
|
|
||
Significant other observable inputs
|
295,472
|
|
|
84.0
|
|
|
1,602
|
|
|
47.1
|
|
||
Level 3
|
|
|
|
|
|
|
|
|
|
||||
Independent pricing source
|
9,086
|
|
|
2.6
|
|
|
309
|
|
|
9.1
|
|
||
Internal matrix pricing or discounted cash flow techniques
|
11,240
|
|
|
3.2
|
|
|
126
|
|
|
3.7
|
|
||
Independent broker quotations
|
1,663
|
|
|
0.5
|
|
|
15
|
|
|
0.5
|
|
||
Significant unobservable inputs
|
21,989
|
|
|
6.3
|
|
|
450
|
|
|
13.3
|
|
||
Total estimated fair value
|
$
|
351,578
|
|
|
100.0
|
%
|
|
$
|
3,399
|
|
|
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 collateralized obligation ABS and foreign government securities.
|
•
|
During the
three months ended
September 30, 2015
, Level 3 fixed maturity securities increased by
$5 million
, or less than
1%
. The increase was driven by purchases in excess of sales, offset by net transfers out of Level 3 and a decrease in estimated fair value recognized in other comprehensive income (loss) (“OCI”). The
purchases in excess of sales
were concentrated in RMBS, ABS, U.S. and foreign corporate securities and commercial mortgage-backed securities(“CMBS”). The net transfers out of Level 3 were concentrated in U.S. and foreign corporate securities, foreign government securities and ABS and the decrease in estimated fair value recognized in OCI was concentrated in
U.S. and foreign corporate securities
.
|
•
|
During the
nine months ended
September 30, 2015
, Level 3 fixed maturity securities decreased by
$146 million
, or less than
1%
. The decrease was
driven by net transfers out of Level 3 and a decrease in estimated fair value recognized in OCI, partially
offset by purchases in excess of sales. The net transfers out of Level 3 were concentrated in ABS,
U.S. and foreign corporate securities, foreign government securities
and RMBS and the decrease in estimated fair value recognized in OCI was concentrated in U.S. and foreign corporate securities. The purchases in excess of sales were concentrated in RMBS, ABS, and U.S. and foreign corporate securities.
|
|
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)
|
||||||||||||||||||||||||||
September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
U.S. corporate
|
$
|
44,323
|
|
|
$
|
43,126
|
|
|
$
|
9,295
|
|
|
$
|
3,707
|
|
|
$
|
506
|
|
|
$
|
—
|
|
|
$
|
100,957
|
|
Foreign corporate
|
23,652
|
|
|
29,862
|
|
|
3,831
|
|
|
912
|
|
|
146
|
|
|
1
|
|
|
58,404
|
|
|||||||
U.S. Treasury and agency
|
59,671
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59,671
|
|
|||||||
Foreign government
|
44,137
|
|
|
4,033
|
|
|
1,495
|
|
|
401
|
|
|
404
|
|
|
53
|
|
|
50,523
|
|
|||||||
RMBS
|
37,710
|
|
|
1,003
|
|
|
639
|
|
|
385
|
|
|
294
|
|
|
19
|
|
|
40,050
|
|
|||||||
State and political subdivision
|
14,878
|
|
|
576
|
|
|
10
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
15,479
|
|
|||||||
CMBS
|
12,309
|
|
|
35
|
|
|
15
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
12,362
|
|
|||||||
ABS
|
13,367
|
|
|
723
|
|
|
21
|
|
|
2
|
|
|
15
|
|
|
4
|
|
|
14,132
|
|
|||||||
Total fixed maturity securities
|
$
|
250,047
|
|
|
$
|
79,358
|
|
|
$
|
15,306
|
|
|
$
|
5,407
|
|
|
$
|
1,383
|
|
|
$
|
77
|
|
|
$
|
351,578
|
|
Percentage of total
|
71.1
|
%
|
|
22.6
|
%
|
|
4.4
|
%
|
|
1.5
|
%
|
|
0.4
|
%
|
|
—
|
%
|
|
100.0
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
December 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
U.S. corporate
|
$
|
46,043
|
|
|
$
|
44,174
|
|
|
$
|
9,627
|
|
|
$
|
5,602
|
|
|
$
|
497
|
|
|
$
|
11
|
|
|
$
|
105,954
|
|
Foreign corporate
|
25,368
|
|
|
31,084
|
|
|
3,775
|
|
|
1,358
|
|
|
89
|
|
|
1
|
|
|
61,675
|
|
|||||||
U.S. Treasury and agency
|
61,516
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
61,516
|
|
|||||||
Foreign government
|
44,837
|
|
|
5,763
|
|
|
744
|
|
|
863
|
|
|
418
|
|
|
41
|
|
|
52,666
|
|
|||||||
RMBS
|
37,156
|
|
|
1,049
|
|
|
766
|
|
|
551
|
|
|
318
|
|
|
6
|
|
|
39,846
|
|
|||||||
State and political subdivision
|
14,656
|
|
|
501
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
15,187
|
|
|||||||
CMBS
|
14,124
|
|
|
30
|
|
|
166
|
|
|
9
|
|
|
3
|
|
|
—
|
|
|
14,332
|
|
|||||||
ABS
|
13,383
|
|
|
807
|
|
|
37
|
|
|
2
|
|
|
15
|
|
|
5
|
|
|
14,249
|
|
|||||||
Total fixed maturity securities
|
$
|
257,083
|
|
|
$
|
83,408
|
|
|
$
|
15,145
|
|
|
$
|
8,385
|
|
|
$
|
1,340
|
|
|
$
|
64
|
|
|
$
|
365,425
|
|
Percentage of total
|
70.4
|
%
|
|
22.8
|
%
|
|
4.1
|
%
|
|
2.3
|
%
|
|
0.4
|
%
|
|
—
|
%
|
|
100.0
|
%
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||
|
Estimated
Fair
Value
|
|
% of
Total
|
|
Estimated
Fair
Value
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Corporate fixed maturity securities — by sector:
|
|
|
|
|
|
|
|
||||||
Foreign corporate (1)
|
$
|
58,404
|
|
|
36.6
|
%
|
|
$
|
61,675
|
|
|
36.8
|
%
|
U.S. corporate fixed maturity securities — by industry:
|
|
|
|
|
|
|
|
||||||
Consumer
|
26,878
|
|
|
16.9
|
|
|
27,808
|
|
|
16.6
|
|
||
Industrial
|
26,001
|
|
|
16.3
|
|
|
27,221
|
|
|
16.2
|
|
||
Utility
|
19,147
|
|
|
12.0
|
|
|
20,029
|
|
|
12.0
|
|
||
Finance
|
18,295
|
|
|
11.5
|
|
|
18,688
|
|
|
11.1
|
|
||
Communications
|
6,963
|
|
|
4.4
|
|
|
8,071
|
|
|
4.8
|
|
||
Other
|
3,673
|
|
|
2.3
|
|
|
4,137
|
|
|
2.5
|
|
||
Total
|
$
|
159,361
|
|
|
100.0
|
%
|
|
$
|
167,629
|
|
|
100.0
|
%
|
(1)
|
Includes both U.S. dollar and foreign denominated securities.
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||
|
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
|
$
|
20,409
|
|
|
51.0
|
%
|
|
$
|
855
|
|
|
$
|
20,269
|
|
|
50.9
|
%
|
|
$
|
1,083
|
|
Pass-through securities
|
19,641
|
|
|
49.0
|
|
|
499
|
|
|
19,577
|
|
|
49.1
|
|
|
699
|
|
||||
Total RMBS
|
$
|
40,050
|
|
|
100.0
|
%
|
|
$
|
1,354
|
|
|
$
|
39,846
|
|
|
100.0
|
%
|
|
$
|
1,782
|
|
By risk profile:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Agency
|
$
|
27,665
|
|
|
69.1
|
%
|
|
$
|
1,168
|
|
|
$
|
26,818
|
|
|
67.3
|
%
|
|
$
|
1,469
|
|
Prime
|
2,106
|
|
|
5.2
|
|
|
53
|
|
|
2,648
|
|
|
6.6
|
|
|
68
|
|
||||
Alt-A
|
6,069
|
|
|
15.2
|
|
|
32
|
|
|
5,540
|
|
|
13.9
|
|
|
85
|
|
||||
Sub-prime
|
4,210
|
|
|
10.5
|
|
|
101
|
|
|
4,840
|
|
|
12.2
|
|
|
160
|
|
||||
Total RMBS
|
$
|
40,050
|
|
|
100.0
|
%
|
|
$
|
1,354
|
|
|
$
|
39,846
|
|
|
100.0
|
%
|
|
$
|
1,782
|
|
Ratings profile:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rated Aaa/AAA
|
$
|
28,069
|
|
|
70.1
|
%
|
|
|
|
$
|
27,362
|
|
|
68.7
|
%
|
|
|
||||
Designated NAIC 1
|
$
|
37,710
|
|
|
94.2
|
%
|
|
|
|
$
|
37,156
|
|
|
93.2
|
%
|
|
|
|
September 30, 2015
|
||||||||||||||||||||||||||||||||||||||||||||||
|
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 - 2005
|
$
|
340
|
|
|
$
|
356
|
|
|
$
|
221
|
|
|
$
|
232
|
|
|
$
|
68
|
|
|
$
|
69
|
|
|
$
|
51
|
|
|
$
|
54
|
|
|
$
|
14
|
|
|
$
|
15
|
|
|
$
|
694
|
|
|
$
|
726
|
|
2006
|
1,442
|
|
|
1,463
|
|
|
69
|
|
|
70
|
|
|
91
|
|
|
92
|
|
|
51
|
|
|
57
|
|
|
—
|
|
|
—
|
|
|
1,653
|
|
|
1,682
|
|
||||||||||||
2007
|
491
|
|
|
506
|
|
|
32
|
|
|
32
|
|
|
163
|
|
|
169
|
|
|
—
|
|
|
—
|
|
|
123
|
|
|
125
|
|
|
809
|
|
|
832
|
|
||||||||||||
2008 - 2010
|
5
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
19
|
|
||||||||||||
2011
|
519
|
|
|
559
|
|
|
23
|
|
|
24
|
|
|
63
|
|
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
605
|
|
|
649
|
|
||||||||||||
2012
|
253
|
|
|
284
|
|
|
251
|
|
|
260
|
|
|
850
|
|
|
874
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
1,356
|
|
|
1,420
|
|
||||||||||||
2013
|
749
|
|
|
794
|
|
|
479
|
|
|
515
|
|
|
1,342
|
|
|
1,399
|
|
|
12
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
2,582
|
|
|
2,718
|
|
||||||||||||
2014
|
736
|
|
|
744
|
|
|
830
|
|
|
832
|
|
|
668
|
|
|
684
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,234
|
|
|
2,260
|
|
||||||||||||
2015
|
1,459
|
|
|
1,465
|
|
|
262
|
|
|
260
|
|
|
305
|
|
|
307
|
|
|
24
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
2,050
|
|
|
2,056
|
|
||||||||||||
Total
|
$
|
5,994
|
|
|
$
|
6,176
|
|
|
$
|
2,167
|
|
|
$
|
2,225
|
|
|
$
|
3,563
|
|
|
$
|
3,674
|
|
|
$
|
138
|
|
|
$
|
145
|
|
|
$
|
139
|
|
|
$
|
142
|
|
|
$
|
12,001
|
|
|
$
|
12,362
|
|
Ratings Distribution
|
|
|
50.0
|
%
|
|
|
|
18.0
|
%
|
|
|
|
29.7
|
%
|
|
|
|
1.2
|
%
|
|
|
|
1.1
|
%
|
|
|
|
100.0
|
%
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
December 31, 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
|
$
|
251
|
|
|
$
|
258
|
|
|
$
|
25
|
|
|
$
|
27
|
|
|
$
|
54
|
|
|
$
|
56
|
|
|
$
|
40
|
|
|
$
|
40
|
|
|
$
|
17
|
|
|
$
|
17
|
|
|
$
|
387
|
|
|
$
|
398
|
|
2005
|
2,278
|
|
|
2,300
|
|
|
412
|
|
|
426
|
|
|
243
|
|
|
253
|
|
|
111
|
|
|
115
|
|
|
9
|
|
|
13
|
|
|
3,053
|
|
|
3,107
|
|
||||||||||||
2006
|
1,983
|
|
|
2,056
|
|
|
103
|
|
|
106
|
|
|
107
|
|
|
110
|
|
|
66
|
|
|
73
|
|
|
—
|
|
|
—
|
|
|
2,259
|
|
|
2,345
|
|
||||||||||||
2007
|
694
|
|
|
720
|
|
|
64
|
|
|
67
|
|
|
195
|
|
|
205
|
|
|
41
|
|
|
43
|
|
|
129
|
|
|
131
|
|
|
1,123
|
|
|
1,166
|
|
||||||||||||
2008 - 2010
|
5
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
30
|
|
||||||||||||
2011
|
561
|
|
|
603
|
|
|
23
|
|
|
24
|
|
|
63
|
|
|
65
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|
651
|
|
|
696
|
|
||||||||||||
2012
|
467
|
|
|
559
|
|
|
245
|
|
|
255
|
|
|
842
|
|
|
866
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
|
1,557
|
|
|
1,683
|
|
||||||||||||
2013
|
802
|
|
|
854
|
|
|
467
|
|
|
505
|
|
|
1,330
|
|
|
1,393
|
|
|
13
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
2,612
|
|
|
2,763
|
|
||||||||||||
2014
|
466
|
|
|
480
|
|
|
883
|
|
|
900
|
|
|
652
|
|
|
677
|
|
|
13
|
|
|
14
|
|
|
76
|
|
|
73
|
|
|
2,090
|
|
|
2,144
|
|
||||||||||||
Total
|
$
|
7,507
|
|
|
$
|
7,835
|
|
|
$
|
2,222
|
|
|
$
|
2,310
|
|
|
$
|
3,511
|
|
|
$
|
3,650
|
|
|
$
|
284
|
|
|
$
|
296
|
|
|
$
|
238
|
|
|
$
|
241
|
|
|
$
|
13,762
|
|
|
$
|
14,332
|
|
Ratings Distribution
|
|
|
54.7
|
%
|
|
|
|
16.1
|
%
|
|
|
|
25.5
|
%
|
|
|
|
2.0
|
%
|
|
|
|
1.7
|
%
|
|
|
|
100.0
|
%
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||
|
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 obligations
|
$
|
7,200
|
|
|
50.9
|
%
|
|
$
|
(101
|
)
|
|
$
|
5,262
|
|
|
36.9
|
%
|
|
$
|
(46
|
)
|
Foreign residential loans
|
1,598
|
|
|
11.3
|
|
|
27
|
|
|
2,146
|
|
|
15.1
|
|
|
63
|
|
||||
Student loans
|
1,366
|
|
|
9.7
|
|
|
(26
|
)
|
|
1,997
|
|
|
14.0
|
|
|
42
|
|
||||
Automobile loans
|
1,067
|
|
|
7.6
|
|
|
7
|
|
|
1,625
|
|
|
11.4
|
|
|
10
|
|
||||
Credit card loans
|
922
|
|
|
6.5
|
|
|
34
|
|
|
1,195
|
|
|
8.4
|
|
|
44
|
|
||||
Other loans
|
1,979
|
|
|
14.0
|
|
|
34
|
|
|
2,024
|
|
|
14.2
|
|
|
15
|
|
||||
Total
|
$
|
14,132
|
|
|
100.0
|
%
|
|
$
|
(25
|
)
|
|
$
|
14,249
|
|
|
100.0
|
%
|
|
$
|
128
|
|
Ratings profile:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Rated Aaa/AAA
|
$
|
7,331
|
|
|
51.9
|
%
|
|
|
|
$
|
7,950
|
|
|
55.8
|
%
|
|
|
||||
Designated NAIC 1
|
$
|
13,367
|
|
|
94.6
|
%
|
|
|
|
$
|
13,383
|
|
|
93.9
|
%
|
|
|
|
September 30, 2015
|
|
December 31, 2014
|
|||||||||||||||||||||||||
|
|
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
|
|
$
|
41,619
|
|
|
65.7
|
%
|
|
$
|
215
|
|
|
0.5
|
%
|
|
$
|
41,088
|
|
|
68.7
|
%
|
|
$
|
224
|
|
|
0.5
|
%
|
Agricultural
|
|
12,771
|
|
|
20.2
|
|
|
41
|
|
|
0.3
|
%
|
|
12,378
|
|
|
20.7
|
|
|
39
|
|
|
0.3
|
%
|
||||
Residential
|
|
8,955
|
|
|
14.1
|
|
|
55
|
|
|
0.6
|
%
|
|
6,369
|
|
|
10.6
|
|
|
42
|
|
|
0.7
|
%
|
||||
Total
|
|
$
|
63,345
|
|
|
100.0
|
%
|
|
$
|
311
|
|
|
0.5
|
%
|
|
$
|
59,835
|
|
|
100.0
|
%
|
|
$
|
305
|
|
|
0.5
|
%
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||
|
Amount
|
|
% of
Total
|
|
Amount
|
|
% of
Total
|
||||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||||
Region
|
|
|
|
|
|
|
|
||||||||
Pacific
|
$
|
9,208
|
|
|
22.1
|
%
|
|
$
|
8,620
|
|
|
21.0
|
%
|
||
Middle Atlantic
|
7,743
|
|
|
18.6
|
|
|
7,689
|
|
|
18.7
|
|
||||
International
|
7,548
|
|
|
18.1
|
|
|
7,251
|
|
|
17.7
|
|
||||
South Atlantic
|
5,858
|
|
|
14.1
|
|
|
6,384
|
|
|
15.5
|
|
||||
West South Central
|
4,289
|
|
|
10.3
|
|
|
3,990
|
|
|
9.7
|
|
||||
East North Central
|
2,127
|
|
|
5.1
|
|
|
2,430
|
|
|
5.9
|
|
||||
New England
|
1,350
|
|
|
3.2
|
|
|
1,155
|
|
|
2.8
|
|
||||
Mountain
|
1,118
|
|
|
2.7
|
|
|
932
|
|
|
2.3
|
|
||||
East South Central
|
408
|
|
|
1.0
|
|
|
424
|
|
|
1.0
|
|
||||
West North Central
|
234
|
|
|
0.6
|
|
|
140
|
|
|
0.3
|
|
||||
Multi-Region and Other
|
1,736
|
|
|
4.2
|
|
|
2,073
|
|
|
5.1
|
|
||||
Total recorded investment
|
41,619
|
|
|
100.0
|
%
|
|
41,088
|
|
|
100.0
|
%
|
||||
Less: valuation allowances
|
215
|
|
|
|
|
224
|
|
|
|
||||||
Carrying value, net of valuation allowances
|
$
|
41,404
|
|
|
|
|
$
|
40,864
|
|
|
|
||||
Property Type
|
|
|
|
|
|
|
|
||||||||
Office
|
$
|
19,951
|
|
|
47.9
|
%
|
|
$
|
21,400
|
|
|
52.1
|
%
|
||
Retail
|
10,002
|
|
|
24.0
|
|
|
9,389
|
|
|
22.9
|
|
||||
Hotel
|
4,456
|
|
|
10.7
|
|
|
4,196
|
|
|
10.2
|
|
||||
Apartment
|
4,865
|
|
|
11.7
|
|
|
3,786
|
|
|
9.2
|
|
||||
Industrial
|
2,191
|
|
|
5.3
|
|
|
2,133
|
|
|
5.2
|
|
||||
Other
|
154
|
|
|
0.4
|
|
|
184
|
|
|
0.4
|
|
||||
Total recorded investment
|
41,619
|
|
|
100.0
|
%
|
|
41,088
|
|
|
100.0
|
%
|
||||
Less: valuation allowances
|
215
|
|
|
|
|
224
|
|
|
|
||||||
Carrying value, net of valuation allowances
|
$
|
41,404
|
|
|
|
|
$
|
40,864
|
|
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||
|
Carrying
Value
|
|
% of
Total
|
|
Carrying
Value
|
|
% of
Total
|
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Traditional
|
$
|
8,420
|
|
|
84.8
|
%
|
|
$
|
9,386
|
|
|
89.2
|
%
|
Real estate joint ventures and funds
|
553
|
|
|
5.6
|
|
|
647
|
|
|
6.2
|
|
||
Subtotal
|
8,973
|
|
|
90.4
|
|
|
10,033
|
|
|
95.4
|
|
||
Foreclosed (commercial, agricultural and residential)
|
45
|
|
|
0.5
|
|
|
320
|
|
|
3.0
|
|
||
Real estate held-for-investment
|
9,018
|
|
|
90.9
|
|
|
10,353
|
|
|
98.4
|
|
||
Real estate held-for-sale
|
905
|
|
|
9.1
|
|
|
172
|
|
|
1.6
|
|
||
Total real estate and real estate joint ventures
|
$
|
9,923
|
|
|
100.0
|
%
|
|
$
|
10,525
|
|
|
100.0
|
%
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||
|
Carrying
Value
|
|
% of
Total
|
|
Carrying
Value
|
|
% of
Total |
||||||
|
(In millions)
|
|
|
|
(In millions)
|
|
|
||||||
Freestanding derivatives with positive estimated fair values
|
$
|
15,515
|
|
|
66.4
|
%
|
|
$
|
13,452
|
|
|
63.2
|
%
|
Tax credit and renewable energy partnerships
|
2,862
|
|
|
12.3
|
|
|
2,752
|
|
|
12.9
|
|
||
Leveraged leases, net of non-recourse debt
|
1,768
|
|
|
7.6
|
|
|
1,785
|
|
|
8.4
|
|
||
Direct financing leases
|
1,039
|
|
|
4.4
|
|
|
1,119
|
|
|
5.3
|
|
||
Funds withheld
|
751
|
|
|
3.2
|
|
|
763
|
|
|
3.6
|
|
||
Operating joint ventures
|
534
|
|
|
2.3
|
|
|
513
|
|
|
2.4
|
|
||
Other
|
887
|
|
|
3.8
|
|
|
899
|
|
|
4.2
|
|
||
Total
|
$
|
23,356
|
|
|
100.0
|
%
|
|
$
|
21,283
|
|
|
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 gross notional amount, estimated fair value, and primary underlying risk exposure of our derivatives by type of hedge designation, excluding embedded derivatives held at
September 30, 2015
and
December 31, 2014
.
|
•
|
The statement of operations effects of derivatives in net investments in foreign operations, cash flow, fair value, or non-qualifying hedge relationships for the
three months
and
nine months ended
September 30, 2015
and
2014
.
|
|
|
Three Months
Ended September 30, 2015 |
|
Nine Months
Ended September 30, 2015 |
Gain (loss) recognized in net income (loss)
|
|
($97) million
|
|
($163) million
|
Percentage of gain (loss) attributable to observable inputs
|
|
(36)%
|
|
(4)%
|
Primary drivers of observable gain (loss)
|
|
Strengthening of the U.S. dollar versus foreign currencies on receive inflation-linked foreign currency, pay U.S. dollar forwards; decreases in certain equity volatility levels; and decreases in equity index levels and swap rates.
|
|
Strengthening of the U.S. dollar versus foreign currencies on receive inflation-linked foreign currency, pay U.S. dollar forwards; decreases in certain equity volatility levels; and decreases in equity index levels.
|
Percentage of gain (loss) attributable to unobservable inputs
|
|
136%
|
|
104%
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||
Credit Default Swaps
|
|
Gross
Notional
Amount
|
|
Estimated
Fair Value
|
|
Gross
Notional
Amount
|
|
Estimated
Fair Value
|
||||||||
|
|
(In millions)
|
||||||||||||||
Purchased (1)
|
|
$
|
2,274
|
|
|
$
|
(7
|
)
|
|
$
|
2,830
|
|
|
$
|
(26
|
)
|
Written (2)
|
|
10,458
|
|
|
47
|
|
|
10,527
|
|
|
175
|
|
||||
Total
|
|
$
|
12,732
|
|
|
$
|
40
|
|
|
$
|
13,357
|
|
|
$
|
149
|
|
(1)
|
The gross notional amount and estimated fair value for purchased credit default swaps in the trading portfolio were $475 million and ($2) million, respectively, at
September 30, 2015
and $250 million and ($6) million, respectively, at
December 31, 2014
.
|
(2)
|
The gross notional amount and estimated fair value for written credit default swaps in the trading portfolio were $20 million and ($1) million, respectively, at
September 30, 2015
and $15 million and $1 million, respectively, at
December 31, 2014
.
|
|
|
Three Months
Ended September 30, |
|
Nine Months
Ended September 30, |
||||||||||||||||||||||||||||||||||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||||||||||||||||||||||||||||||||||
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)
|
|
$
|
20
|
|
|
$
|
(1
|
)
|
|
$
|
19
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
32
|
|
|
$
|
(20
|
)
|
|
$
|
12
|
|
|
$
|
18
|
|
|
$
|
(18
|
)
|
|
$
|
—
|
|
Written (3), (4)
|
|
—
|
|
|
(78
|
)
|
|
(78
|
)
|
|
(15
|
)
|
|
(17
|
)
|
|
(32
|
)
|
|
16
|
|
|
(124
|
)
|
|
(108
|
)
|
|
20
|
|
|
(39
|
)
|
|
(19
|
)
|
||||||||||||
Total
|
|
$
|
20
|
|
|
$
|
(79
|
)
|
|
$
|
(59
|
)
|
|
$
|
(9
|
)
|
|
$
|
(17
|
)
|
|
$
|
(26
|
)
|
|
$
|
48
|
|
|
$
|
(144
|
)
|
|
$
|
(96
|
)
|
|
$
|
38
|
|
|
$
|
(57
|
)
|
|
$
|
(19
|
)
|
(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 $4 million and ($1) million, respectively, for the
three months ended
September 30, 2015
and $7 million and ($4) million, respectively, for the nine months ended
September 30, 2015
. The gross gains and gross (losses) for purchased credit default swaps in the trading portfolio were $1 million and $0, respectively, for the
three months ended
September 30, 2014
and $4 million and ($3) million, respectively, for the
nine months ended
September 30, 2014
.
|
(3)
|
The gross gains and gross (losses) for written credit default swaps in the trading portfolio were $2 million and ($3) million for the three months ended
September 30, 2015
and $3 million and ($3) million, respectively, for the nine months ended
September 30, 2015
. The gross gains and gross (losses) for written credit default swaps in our trading portfolio were not significant for both the
three months
and
nine months ended
September 30, 2014
.
|
(4)
|
Gains (losses) do not include earned income (expense) on credit default swaps.
|
|
September 30, 2015
|
||||||
|
Account
Value (1)
|
|
Account
Value at
Guarantee (1)
|
||||
Guaranteed Minimum Crediting Rate
|
(In millions)
|
||||||
Life & Other
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
96
|
|
|
$
|
96
|
|
Equal to 2% but less than 4%
|
$
|
12,351
|
|
|
$
|
5,238
|
|
Equal to or greater than 4%
|
$
|
10,601
|
|
|
$
|
6,312
|
|
Annuities
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
3,386
|
|
|
$
|
2,927
|
|
Equal to 2% but less than 4%
|
$
|
31,422
|
|
|
$
|
26,119
|
|
Equal to or greater than 4%
|
$
|
2,387
|
|
|
$
|
2,345
|
|
|
September 30, 2015
|
||||||
|
Account
Value (1)
|
|
Account
Value at
Guarantee (1)
|
||||
Guaranteed Minimum Crediting Rate
|
(In millions)
|
||||||
Greater than 0% but less than 2%
|
$
|
4,848
|
|
|
$
|
4,844
|
|
Equal to 2% but less than 4%
|
$
|
2,047
|
|
|
$
|
2,017
|
|
Equal to or greater than 4%
|
$
|
674
|
|
|
$
|
647
|
|
(1)
|
These amounts are not adjusted for policy loans.
|
|
September 30, 2015
|
||||||
|
Account
Value (2)
|
|
Account
Value at
Guarantee (2)
|
||||
Guaranteed Minimum Crediting Rate (1)
|
(In millions)
|
||||||
Annuities
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
18,794
|
|
|
$
|
3,188
|
|
Equal to 2% but less than 4%
|
$
|
1,022
|
|
|
$
|
239
|
|
Equal to or greater than 4%
|
$
|
1
|
|
|
$
|
1
|
|
Life & Other
|
|
|
|
||||
Greater than 0% but less than 2%
|
$
|
6,283
|
|
|
$
|
5,947
|
|
Equal to 2% but less than 4%
|
$
|
17,661
|
|
|
$
|
8,021
|
|
Equal to or greater than 4%
|
$
|
266
|
|
|
$
|
—
|
|
(1)
|
Excludes negative VOBA liabilities of $1.3 billion at
September 30, 2015
, 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 associated with the acquisition of American Life Insurance Company (“American Life”) and Delaware American Life Insurance Company (“DelAm”) (collectively, “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
|
||||||||||||
|
September 30, 2015
|
|
December 31, 2014
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||
|
(In millions)
|
||||||||||||||
Americas
|
|
|
|
|
|
|
|
||||||||
GMDB
|
$
|
904
|
|
|
$
|
710
|
|
|
$
|
—
|
|
|
$
|
—
|
|
GMIB
|
2,357
|
|
|
1,993
|
|
|
(155
|
)
|
|
(1,278
|
)
|
||||
GMAB
|
—
|
|
|
—
|
|
|
17
|
|
|
2
|
|
||||
GMWB
|
125
|
|
|
104
|
|
|
540
|
|
|
38
|
|
||||
Asia
|
|
|
|
|
|
|
|
||||||||
GMDB
|
25
|
|
|
29
|
|
|
—
|
|
|
—
|
|
||||
GMAB
|
—
|
|
|
—
|
|
|
37
|
|
|
22
|
|
||||
GMWB
|
85
|
|
|
91
|
|
|
142
|
|
|
129
|
|
||||
EMEA
|
|
|
|
|
|
|
|
||||||||
GMDB
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||
GMAB
|
—
|
|
|
—
|
|
|
21
|
|
|
23
|
|
||||
GMWB
|
28
|
|
|
26
|
|
|
(31
|
)
|
|
(61
|
)
|
||||
Corporate & Other
|
|
|
|
|
|
|
|
||||||||
GMDB
|
12
|
|
|
17
|
|
|
—
|
|
|
—
|
|
||||
GMAB
|
—
|
|
|
—
|
|
|
24
|
|
|
23
|
|
||||
GMWB
|
101
|
|
|
74
|
|
|
991
|
|
|
949
|
|
||||
Total
|
$
|
3,639
|
|
|
$
|
3,046
|
|
|
$
|
1,586
|
|
|
$
|
(153
|
)
|
|
Total Contract
Account Value (1)
|
||||||||||
|
Americas
|
|
Asia & EMEA
|
|
Corporate &
Other
|
||||||
|
(In millions)
|
||||||||||
Return of premium or five to seven year step-up
|
$
|
98,983
|
|
|
$
|
10,225
|
|
|
$
|
10,992
|
|
Annual step-up
|
27,570
|
|
|
—
|
|
|
—
|
|
|||
Roll-up and step-up combination
|
36,474
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
163,027
|
|
|
$
|
10,225
|
|
|
$
|
10,992
|
|
(1)
|
Total contract account value excludes $2.1 billion for contracts with no GMDBs. Further, many of our annuity contracts offer more than one type of guarantee such that GMDB amounts listed above are not mutually exclusive to the amounts in the living benefit guarantees table below.
|
|
Total Contract
Account Value (1)
|
||||||||||
|
Americas
|
|
Asia & EMEA
|
|
Corporate &
Other
|
||||||
|
(In millions)
|
||||||||||
GMIB
|
$
|
89,914
|
|
|
$
|
—
|
|
|
$
|
—
|
|
GMWB - non-life contingent (2)
|
5,728
|
|
|
2,673
|
|
|
2,526
|
|
|||
GMWB - life-contingent
|
21,114
|
|
|
4,648
|
|
|
7,443
|
|
|||
GMAB
|
593
|
|
|
1,399
|
|
|
1,023
|
|
|||
|
$
|
117,349
|
|
|
$
|
8,720
|
|
|
$
|
10,992
|
|
(1)
|
Total contract account value excludes $47.8 billion for contracts with no living benefit guarantees. Further, many of our annuity contracts offer more than one type of guarantee such that living benefit guarantee amounts listed above are not mutually exclusive of the amounts in the GMDBs table above.
|
(2)
|
The Asia and EMEA segments include the non-life contingent portion of the GMWB total contract account value of $938 million with a guarantee at annuitization.
|
|
Total Contract
Account Value
|
||
|
(In millions)
|
||
7-year setback, 2.5% interest rate
|
$
|
32,133
|
|
7-year setback, 1.5% interest rate
|
5,547
|
|
|
10-year setback, 1.5% interest rate
|
18,242
|
|
|
10-year mortality projection, 10-year setback, 1.0% interest rate
|
29,763
|
|
|
10-year mortality projection, 10-year setback, 0.5% interest rate
|
4,229
|
|
|
|
$
|
89,914
|
|
|
In-the-
Moneyness
|
|
Total Contract
Account Value
|
|
% of Total
|
|
||
|
|
|
(In millions)
|
|
|
|||
In-the-money
|
30% +
|
|
$
|
2,586
|
|
|
2.9
|
%
|
|
20% to 30%
|
|
2,184
|
|
|
2.4
|
%
|
|
|
10% to 20%
|
|
3,966
|
|
|
4.4
|
%
|
|
|
0% to 10%
|
|
6,541
|
|
|
7.3
|
%
|
|
|
|
|
15,277
|
|
|
|
||
Out-of-the-money
|
-10% to 0%
|
|
14,296
|
|
|
15.9
|
%
|
|
|
-20% to -10%
|
|
8,823
|
|
|
9.8
|
%
|
|
|
-20% +
|
|
51,518
|
|
|
57.3
|
%
|
|
|
|
|
74,637
|
|
|
|
||
Total GMIBs
|
|
|
$
|
89,914
|
|
|
|
|
|
Instrument Type
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||||
Primary Underlying
Risk Exposure
|
|
Gross Notional
Amount
|
|
Estimated Fair Value
|
|
Gross Notional
Amount
|
|
Estimated Fair Value
|
||||||||||||||||||
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||||||||||||||
|
|
|
|
(In millions)
|
||||||||||||||||||||||
Interest rate
|
|
Interest rate swaps
|
|
$
|
23,506
|
|
|
$
|
2,159
|
|
|
$
|
966
|
|
|
$
|
22,794
|
|
|
$
|
1,881
|
|
|
$
|
834
|
|
|
|
Interest rate futures
|
|
3,874
|
|
|
3
|
|
|
9
|
|
|
2,707
|
|
|
3
|
|
|
9
|
|
||||||
|
|
Interest rate options
|
|
25,260
|
|
|
1,129
|
|
|
1
|
|
|
36,510
|
|
|
908
|
|
|
26
|
|
||||||
Foreign currency exchange rate
|
|
Foreign currency forwards
|
|
2,306
|
|
|
67
|
|
|
4
|
|
|
2,241
|
|
|
1
|
|
|
137
|
|
||||||
|
|
Foreign currency futures
|
|
183
|
|
|
1
|
|
|
—
|
|
|
522
|
|
|
2
|
|
|
—
|
|
||||||
Equity market
|
|
Equity futures
|
|
6,748
|
|
|
22
|
|
|
82
|
|
|
6,065
|
|
|
65
|
|
|
2
|
|
||||||
|
|
Equity options
|
|
45,115
|
|
|
1,678
|
|
|
920
|
|
|
37,427
|
|
|
1,422
|
|
|
1,035
|
|
||||||
|
|
Variance swaps
|
|
24,872
|
|
|
209
|
|
|
682
|
|
|
24,598
|
|
|
196
|
|
|
639
|
|
||||||
|
|
Total rate of return swaps
|
|
3,847
|
|
|
248
|
|
|
4
|
|
|
3,297
|
|
|
22
|
|
|
101
|
|
||||||
|
|
Total
|
|
$
|
135,711
|
|
|
$
|
5,516
|
|
|
$
|
2,668
|
|
|
$
|
136,161
|
|
|
$
|
4,500
|
|
|
$
|
2,783
|
|
|
Nine Months
Ended September 30, |
||||||
|
2015
|
|
2014
|
||||
|
(In millions)
|
||||||
Sources:
|
|
|
|
||||
Operating activities, net
|
$
|
9,527
|
|
|
$
|
10,950
|
|
Changes in policyholder account balances, net
|
—
|
|
|
2,554
|
|
||
Changes in payables for collateral under securities loaned and other transactions, net
|
2,664
|
|
|
3,481
|
|
||
Long-term debt issued
|
1,578
|
|
|
1,000
|
|
||
Preferred stock issued, net of issuance costs
|
1,483
|
|
|
—
|
|
||
Cash received in connection with collateral financing arrangements
|
6
|
|
|
—
|
|
||
Other, net
|
6
|
|
|
—
|
|
||
Total sources
|
15,264
|
|
|
17,985
|
|
||
Uses:
|
|
|
|
||||
Investing activities, net
|
6,907
|
|
|
11,669
|
|
||
Changes in policyholder account balances, net
|
3,557
|
|
|
—
|
|
||
Short-term debt repayments, net
|
—
|
|
|
75
|
|
||
Long-term debt repaid
|
1,078
|
|
|
2,802
|
|
||
Collateral financing arrangements repaid
|
44
|
|
|
—
|
|
||
Treasury stock acquired in connection with share repurchases
|
1,107
|
|
|
443
|
|
||
Repurchase of preferred stock
|
1,460
|
|
|
—
|
|
||
Preferred stock repurchase premium
|
42
|
|
|
—
|
|
||
Dividends on preferred stock
|
67
|
|
|
91
|
|
||
Dividends on common stock
|
1,234
|
|
|
1,101
|
|
||
Other, net
|
—
|
|
|
546
|
|
||
Effect of change in foreign currency exchange rates on cash and cash equivalents
|
360
|
|
|
60
|
|
||
Total uses
|
15,856
|
|
|
16,787
|
|
||
Net increase (decrease) in cash and cash equivalents
|
$
|
(592
|
)
|
|
$
|
1,198
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Short-term debt
|
$
|
100
|
|
|
$
|
100
|
|
Long-term debt (1)
|
$
|
16,683
|
|
|
$
|
16,135
|
|
Collateral financing arrangements
|
$
|
4,152
|
|
|
$
|
4,196
|
|
Junior subordinated debt securities
|
$
|
3,194
|
|
|
$
|
3,193
|
|
(1)
|
Excludes $72 million and $151 million at
September 30, 2015
and
December 31, 2014
, respectively, of long-term debt relating to CSEs — FVO (see Note
5
of the Notes to the Interim Condensed Consolidated Financial Statements).
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Preferred Stock Dividend
|
||||||||||||||
Series A
Per Share
|
|
Series A
Aggregate
|
|
Series B
Per Share
|
|
Series B
Aggregate
|
||||||||||||||
|
|
|
|
|
|
(In millions, except per share data)
|
||||||||||||||
August 17, 2015
|
|
August 31, 2015
|
|
September 15, 2015
|
|
$
|
0.256
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
May 15, 2015
|
|
May 31, 2015
|
|
June 15, 2015
|
|
$
|
0.256
|
|
|
7
|
|
|
$
|
0.406
|
|
|
24
|
|
||
March 5, 2015
|
|
February 28, 2015
|
|
March 16, 2015
|
|
$
|
0.250
|
|
|
6
|
|
|
$
|
0.406
|
|
|
24
|
|
||
|
|
|
|
|
|
|
|
$
|
19
|
|
|
|
|
$
|
48
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
August 15, 2014
|
|
August 31, 2014
|
|
September 15, 2014
|
|
$
|
0.256
|
|
|
$
|
6
|
|
|
$
|
0.406
|
|
|
$
|
24
|
|
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
|
|
||
|
|
|
|
|
|
|
|
$
|
19
|
|
|
|
|
$
|
72
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Common Stock Dividend
|
||||||
Per Share
|
|
Aggregate
|
||||||||||
|
|
|
|
|
|
(In millions, except per share data)
|
||||||
July 7, 2015
|
|
August 7, 2015
|
|
September 11, 2015
|
|
$
|
0.375
|
|
|
$
|
420
|
|
April 28, 2015
|
|
May 11, 2015
|
|
June 12, 2015
|
|
$
|
0.375
|
|
|
420
|
|
|
January 6, 2015
|
|
February 6, 2015
|
|
March 13, 2015
|
|
$
|
0.350
|
|
|
394
|
|
|
|
|
|
|
|
|
|
|
$
|
1,234
|
|
||
|
|
|
|
|
|
|
|
|
||||
July 7, 2014
|
|
August 8, 2014
|
|
September 12, 2014
|
|
$
|
0.350
|
|
|
$
|
395
|
|
April 22, 2014
|
|
May 9, 2014
|
|
June 13, 2014
|
|
$
|
0.350
|
|
|
395
|
|
|
January 6, 2014
|
|
February 6, 2014
|
|
March 13, 2014
|
|
$
|
0.275
|
|
|
311
|
|
|
|
|
|
|
|
|
|
|
$
|
1,101
|
|
|
|
2015
|
||||||
Company
|
|
Paid
|
|
Permitted w/o
Approval (1)
|
||||
|
|
(In millions)
|
||||||
Metropolitan Life Insurance Company
|
|
$
|
600
|
|
|
$
|
1,200
|
|
American Life Insurance Company
|
|
$
|
—
|
|
|
$
|
—
|
|
MetLife Insurance Company USA
|
|
$
|
500
|
|
|
$
|
3,056
|
|
Metropolitan Property and Casualty Insurance Company
|
|
$
|
—
|
|
|
$
|
239
|
|
Metropolitan Tower Life Insurance Company
|
|
$
|
—
|
|
|
$
|
102
|
|
(1)
|
Reflects dividend amounts that may be paid during 2015 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 2015, some or all of such dividends may require regulatory approval.
|
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Long-term debt — unaffiliated
|
$
|
15,777
|
|
|
$
|
15,317
|
|
Long-term debt — affiliated
|
$
|
3,600
|
|
|
$
|
3,600
|
|
Collateral financing arrangements
|
$
|
2,797
|
|
|
$
|
2,797
|
|
Junior subordinated debt securities
|
$
|
1,748
|
|
|
$
|
1,748
|
|
•
|
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 policyholder account balances 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.
|
•
|
Operating ROE is defined as operating earnings available to common shareholders, divided by average GAAP common stockholders’ equity;
|
•
|
Operating ROE, excluding AOCI other than FCTA, is defined as operating earnings available to common shareholders divided by average GAAP common stockholders’ equity, excluding AOCI other than FCTA;
|
•
|
Allocated equity is defined as the portion of common stockholders’ equity that management allocates to each of its segments and sub-segments based on our economic capital model, coupled with considerations of local capital requirements.
See “— Economic Capital
;”
|
•
|
The impact of changes in our foreign currency exchange rates is calculated using the average foreign currency exchange rates for the current period and is applied to each of the comparable periods; and
|
•
|
Asymmetrical and non-economic accounting for insurance contracts refers to Inflation and Pass Through Adjustments as noted above within the definition of operating expenses.
|
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)
|
||||||
July 1 — July 31, 2015
|
|
1,312
|
|
|
$
|
54.83
|
|
|
—
|
|
|
$
|
260,735,204
|
|
August 1 — August 31, 2015
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
260,735,204
|
|
September 1 — September 30, 2015
|
|
2,300,289
|
|
|
$
|
46.70
|
|
|
2,299,631
|
|
|
$
|
892,600,098
|
|
(1)
|
During the periods July 1 through July 31, 2015, August 1 through August 31, 2015 and September 1 through
September 30, 2015
, separate account index funds purchased
1,312
shares,
0
shares and
658
shares, respectively, of common stock on the open market in nondiscretionary transactions. 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)
|
On April 22, 2008, MetLife, Inc. announced that its Board of Directors authorized $1.0 billion of common stock repurchases, which were completed in January 2015. On December 12, 2014, MetLife, Inc. announced that its Board of Directors authorized an additional $1.0 billion of common stock repurchases under which purchases commenced in January 2015, and on September 22, 2015, MetLife, Inc. announced that its Board of Directors authorized additional repurchases of $739 million of its common stock, bringing MetLife, Inc.’s available repurchase authorization under the December 2014 and September 2015 authorizations to $1.0 billion. At
September 30, 2015
, MetLife, Inc. had
$893 million
remaining under these authorizations. In October 2015, MetLife, Inc. purchased 3,288,239 shares of its common stock in the open market under these authorizations, and at
October 30, 2015
MetLife, Inc. had $739 million remaining under these authorizations. Under the April 2008, December 2014 and September 2015 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 Exchange Act) and in privately negotiated transactions. Common stock repurchases are 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 the 2014 Annual Report, as amended or supplemented by the information under the similarly named section in MetLife, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015, as well as Note 16 of the Notes to the Consolidated Financial Statements included in the 2014 Annual Report. See
Note 15
of the Notes to the Interim Condensed Consolidated Financial Statements for information on common stock repurchases subsequent to
September 30, 2015
.
|
Period
|
|
(a) Total Number
of Shares Purchased |
|
(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 (1) |
||||||
July 1 — July 31, 2015
|
|
22,807,587
|
|
|
$
|
25.00
|
|
|
22,807,587
|
|
|
$
|
—
|
|
August 1 — August 31, 2015
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
September 1 — September 30, 2015
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
(1)
|
In June 2015, MetLife, Inc. conducted a tender offer for up to
59,850,000
of its
60,000,000
shares of Series B preferred stock, at a purchase price of
$25
per share, plus an amount equal to accrued, unpaid and undeclared dividends from, and including, June 15, 2015 to, but excluding, June 29, 2015, the settlement date of the tender offer. In June 2015, MetLife, Inc. also delivered a notice of redemption to the holders of the Series B preferred stock, pursuant to which it would redeem any Series B preferred stock not purchased by it in the tender offer at a redemption price of
$25
per share, without any payment for accrued, unpaid and undeclared dividends on the Series B preferred stock from, and including, June 15, 2015 to, but excluding July 1, 2015, the redemption date. On June 29, 2015, MetLife, Inc. repurchased and canceled
37,192,413
shares of Series B preferred stock in connection with its publicly announced tender offer for
$932 million
in cash (or $25.06 per share). On July 1, 2015, MetLife, Inc. redeemed and canceled the remaining 22,807,587 shares of Series B preferred stock not tendered in the tender offer for an aggregate redemption price of $570 million in cash. See
Note 9
of the Notes to the Interim Condensed Consolidated Financial Statements.
|
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)
|
to pay you the sum of $2,004,006.00 (two million four thousand and six dollars and zero cents) less all applicable federal, state and local tax withholding. MetLife will make this payment on the next available payroll date following the later of your date of discontinuance and the Effective Date of this Agreement, but in any event on or before March 15 of the calendar year after the earlier of (i) your date of discontinuance, or (ii) the date you were first offered a separation agreement in connection with this discontinuance of your employment, so long as the Effective Date has occurred by that time. If your “separation from service” as defined under U.S. Internal Revenue Code Section 409A is different from your date of discontinuance, your “separation from service,” rather than your date of discontinuance, will be used to determine the date by which payment will be made.
|
b)
|
that you will qualify for an “Eligibility Enhancement” to qualify for Retirement Eligibility as, to the extent provided under, and subject to the terms and conditions of, the applicable Company benefit plans, including the provisions regarding amendment and termination of those plans. Any such additional age or service will neither be taken into account for, nor result in, additional accrued benefits, increased company contributions, receipt of benefits under the traditional formula of the MetLife Retirement Plan for U.S. Employees prior to actual attainment of age 55 or other additional benefits.
|
c)
|
that you will qualify for an “Eligibility Enhancement” to qualify for MetLife Choices Eligibility as, to the extent provided under, and subject to the terms and conditions of, the applicable Company benefit plans, including the provisions regarding amendment and termination of those plans. Any such additional age or service will neither be taken into account for, nor result in, additional accrued benefits, increased company matching contributions, or other additional benefits.
|
|
|
|
/s/ William J. Wheeler
|
|
7/30/15
|
Signature
|
|
Date
|
|
|
|
STATE OF
|
New York
|
|
COUNTY OF
|
Kings
|
|
/s/ Keisha Henderson
|
Notary Public
|
Notary Public Commission Expiration Date: 9/25/18
|
|
|
|
MetLife Group, Inc.
|
|
|
|
by
|
/s/ Frans Hijkoop
|
|
Frans Hijkoop
|
|
Executive Vice President and
|
|
Chief Human Resources Officer
|
1.
|
All equipment, documents, and all information and other property that belongs to MetLife that I receive or develop in the course of my employment by MetLife, remain the property and information of MetLife. The products of all of my efforts in the course of my employment belong exclusively to MetLife and, unless the officer in charge of my department agrees to some other arrangement in writing, I will not retain any rights in any such work product. I agree to return all property and information immediately and without keeping any copies when my employment terminates for any reason.
|
2.
|
For 18 months following the termination of my employment with MetLife for any reason:
|
A.
|
I will not interfere in MetLife’s business or try to disrupt MetLife’s business. This includes things I might do through my own efforts, or indirectly through the efforts of others, and I will not use any MetLife information or property to assist others. This includes diverting business away from MetLife or seeking to have any MetLife customer reduce or terminate any insurance obtained from or through MetLife.
|
B.
|
I will not solicit any employee of MetLife or its affiliated entities (“Employee”) to become employed, associated or contracted by or with me or any entity in which I am an employee, owner or investor (“Other Company”). I will not solicit any Employee to become employed, associated or contracted with an organization providing services to me or any Other Company. For example, I will not inform an Employee of a job opportunity with me or any Other Company, or suggest that any person or entity contact an Employee to discuss or mention such a job opportunity. I also will not interview an Employee for a job, or offer, authorize, approve or agree to hire an Employee for any job opportunity with me or any Other Company.
|
C.
|
I will not make statements that damage, disparage or otherwise diminish the reputation and business practices of MetLife and its affiliated entities, and its and their officers, directors and employees. This includes statements made verbally, in writing or electronically. The only exception is if I am compelled by a court of law or I am otherwise authorized to do this pursuant to legal or administrative process.
|
D.
|
I authorize MetLife to present a copy of this agreement to each of my subsequent employers.
|
3.
|
I acknowledge that the business of MetLife is conducted all states and in certain foreign countries and that the employees of MetLife and its affiliated entities are working to further the interests of MetLife in those states and foreign countries. I also acknowledge that the property and information I obtain in the course of my employment involves and affects MetLife’s activities in all states and in those foreign countries in which it conducts its business. Therefore, it is not appropriate or feasible for MetLife to establish geographic limitations on the restrictions to which I am now agreeing. Accordingly, I agree to abide by these restrictions in all states and in those foreign countries in which MetLife is or has plans to conduct business at the time that my employment terminates.
|
4.
|
I acknowledge that, if I violate any provision of this Agreement, MetLife will suffer irreparable harm. Therefore, in addition to any other rights or remedies of MetLife, MetLife will have the right to obtain an injunction enjoining any such violation. If MetLife succeeds in any lawsuit or proceeding against me brought to enforce this Agreement, or to establish damages sustained by MetLife as a result of my violation of this Agreement, I will reimburse MetLife’s attorney’s fees and costs, as these may be fixed by the court in which MetLife sues me or brings a proceeding against me.
|
5.
|
If any provision of this Agreement is invalidated in any jurisdiction either by statute or by a court, that provision will be deemed modified to comply with the law or deemed stricken from this Agreement, if that is necessary to comply with the law. If any provision is stricken for this reason, however, the remainder of this Agreement remains in effect.
|
|
|
|
Signature:
|
|
/s/ William J. Wheeler
|
|
|
|
Dept:
|
|
Institutional
|
|
|
|
Name:
|
|
William J. Wheeler
|
|
|
|
Date:
|
|
June 21, 2001
|
|
|
|
Witness:
|
|
/s/ Lily Salzberg
|
|
|
|
Name & Title:
|
Lily Salzberg, Secretary to Sr. V-P
|
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
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d)
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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
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a)
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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
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b)
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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.
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/s/ Steven A. Kandarian
|
Steven A. Kandarian
Chairman of the Board, President and
Chief Executive Officer
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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;
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b)
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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;
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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 of the Board, President and
Chief Executive Officer
|
/s/ John C. R. Hele
|
John C. R. Hele
Executive Vice President and
Chief Financial Officer
|