KBW Insurance Conference. September 3, 2003

Transcription

1 KBW Insurance Conference September 3, 2003

2 Safe Harbor Statement These materials contain statements which constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to trends in the operations and financial results and the business and the products of MetLife, Inc. and its subsidiaries (collectively, the company ), as well as other statements including words such as "anticipate," "believe," "plan," "estimate," "expect," "intend" and other similar expressions. Forward-looking statements are made based upon management's current expectations and beliefs concerning future developments and their potential effects on the Company. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those included in the forward-looking statements as a result of risks and uncertainties including, but not limited to the following: (i) changes in general economic conditions, including the performance of financial markets and interest rates; (ii) heightened competition, including with respect to pricing, entry of new competitors and the development of new products by new and existing competitors; (iii) unanticipated changes in industry trends; (iv) MetLife, Inc.'s primary reliance, as a holding company, on dividends from its subsidiaries to meet debt payment obligations and the applicable regulatory restrictions on the ability of the subsidiaries to pay such dividends; (v) deterioration in the experience of the "closed block" established in connection with the reorganization of Metropolitan Life; (vi) catastrophe losses; (vii) adverse litigation or arbitration results; (viii) regulatory, accounting or tax changes that may affect the cost of, or demand for, the Company's products or services; (ix) downgrades in the Company's or its affiliates' claims paying ability, financial strength or debt ratings; (x) changes in rating agency policies or practices; (xi) discrepancies between actual claims experience and assumptions used in setting prices for the Company's products and establishing the liabilities for the Company's obligations for future policy benefits and claims; (xii) discrepancies between actual experience and assumptions used in establishing liabilities related to other contingencies or obligations; (xiii) the effects of business disruption or economic contraction due to terrorism or other hostilities; and (xiv) other risks and uncertainties described from time to time in MetLife, Inc.'s filings with the Securities and Exchange Commission, including its S-1 and S-3 registration statements. The Company specifically disclaims any obligation to update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

3 Note on Non-GAAP Measures This presentation includes certain financial measures not based on generally accepted accounting principles, so-called non-gaap measures. MetLife analyzes its performance using operating earnings and operating earnings per diluted share. Operating earnings is defined as net income, excluding after-tax net investment gains and losses, and the after-tax impact from the cumulative effect of accounting changes. Operating earnings per diluted share is calculated by dividing operating earnings as defined above by the number of weighted average diluted shares outstanding for the period indicated. Operating earnings and operating earnings per diluted share should not be viewed as a substitute for GAAP net income and GAAP net income per share, respectively. Reconciliations of the non-gaap measures used in this presentation to the most directly comparable GAAP measures are included in this presentation, in our earnings releases and our quarterly financial supplements, which are available on our website at MetLife.com on our Investor Relations page.

4 Corporate Vision Build financial freedom for everyone

5 Demand Drivers Demographics Financial insecurity Retirement planning needs Volatile markets Impact of September 11th

6 What Do We Offer The Market? Trusted, well-recognized brands Leading market positions Competitive products Diversified distribution Strong financial ratings

7 Protection Products Environment Defined Benefit Defined Contribution Flight to Quality Third Party National Accounts Career Agents Customer Centric Focus GRO Independent Agents SBC

8 What Do We Offer Investors? Strong earnings growth Diversified earnings stream Capital flexibility Improving return on equity Improving productivity

9 Corporate Overview 2Q03 2Q02 Net income $580 $387 After-tax net investment (gains) losses Operating earnings $620 $504 Net income $0.79 $0.53 After-tax net investment (gains) losses Operating earnings $0.84 $0.69 * 2Q03 operating earnings includes a $64 million after-tax benefit from a reduction of a previously established liability related to the Company s race conscious underwriting settlement and $62 million of after-tax earnings from the merger of the Company s Mexican operations and a reduction in policyholder liabilities resulting from a change in reserve methodology, and a $31 million after-tax charge related to previously deferred expenses. * 2Q02 operating earnings includes a $30 million after-tax reduction of a previously established liability related to the Company s sales practice class action settlement in 1999.

10 Book Value Per Common Share Excl $ $ $18 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 Actual Shares Diluted Shares

11 Diversified Earnings Life Insurance: 33% Traditional Life 13% 3% 15% Variable/Universal Life Group Life 4% 3% Savings: 30% Annuities Retirement & Savings 7% 15% Other Diversified: 37% Non-Medical Health Auto & Home 12% Reinsurance International 10% Other 20% Pie Chart represents percentage contribution to six month 2003 operating earnings, excluding the Corporate & Other segment.

12 2003 Operating Earnings Results 2Q QTD 2Q YTD Individual $151 $311 Institutional Auto & Home International Reinsurance Asset Management 5 6 Corporate & Other Total $620 $1,066 * 2Q03 operating earnings includes a $64 million after-tax benefit from a reduction of a previously established liability related to the Company s race conscious underwriting settlement (corporate) and $62 million of after-tax earnings from the merger of the Company s Mexican operations (International) and a reduction in policyholder liabilities resulting from a change in reserve methodology, and a $31 million after-tax charge related to previously deferred expenses (Individual). * 2Q02 operating earnings includes a $30 million after-tax reduction of a previously established liability related to the Company s sales practice class action settlement in 1999 (corporate).

13 Individual Business Benchmarks Benchmarks Rank Sales Reps/Agents #1 Life Insurance In-Force #1 Life Insurance Sales #3 Variable Life Insurance Sales #2 Variable Annuity Sales #4 Source: Number of Reps/Agents and Life Insurance In-Force according to AM Best as of year-end 2001; Life Insurance Sales according to LIMRA as of year-end 2002; Variable Life Insurance Sales according to LIMRA as of year-end 2002; and Variable Annuity Sales according to VARDS as of 3/31/03.

14 Individual Business Statutory Premiums & Deposits Up 13.6% $14,255 $16,200 ($Millions) $3,909 Up 24.4% $4, Q02 2Q03

15 Annuity Deposits - QFS Full Year ($Millions) Change 2Q02 2Q03 Change Variable $4,471 $6,426 44% $1,566 $2,593 66% Fixed 1,205 1,467 22% % Total $5,676 $7,893 39% $1,849 $2,933 59% MLI $1,776 $3,513 98% $ 687 $1, % Other 3,900 4,380 12% 1,162 1,297 12% Total $5,676 $7,893 39% $1,849 $2,933 59%

16 Breadth of Institutional Business Group Life Term Life, GUL, GVUL, COLI, TCA, PRB $28 billion in assets Premiums, fees and other revenues up 5% to $1.34 billion Retirement & Savings Annuities, GICs, Funding Agreement, Sep. Accounts $74 billion in assets Premiums, fees and other revenues down 10% to $403 million (premiums & deposits to general accounts up 33% to $3 billion) Non-Medical Health Dental, Disability, LTC, AD & D, Group Legal, SBC Products $8 billion in assets Premiums, fees and other revenues up 17% to $895 million At or for the three months ended June 30, 2003

17 Institutional Business Premiums, Fees & Other Revenues Up 11.1% $8,529 $9,478 ($Millions) $2,486 Up 6.2% $2, Q02 2Q03

18 Voluntary Benefits Market Premiums and Fees $2,410 CAGR 12.4% $2,716 $3,045 ($Millions)

19 Auto & Home Second Quarter 2003 Operating earnings of $42 million Average earned premium increased 11% Combined ratio 98.8% vs % a year ago

20 International Operations Seed India China Feed High Focus on Development Mexico, South Korea, Chile, Taiwan Moderate Focus on Development Brazil, Indonesia, Hong Kong & Spain Maintenance Argentina & Uruguay Weed Philippines Poland 70% - 80% of operating revenues and operating earnings from: Mexico, South Korea, Chile

21 Summary Benefiting from broad diversity of earnings sources Adherence to profitability targets Terminating unprofitable product offerings Focus on distribution system profitability Disciplined expense management Prudent spread management On track to achieve full year targets

22 h a v e y o u m e t l i f e t o d a y? SM