MetLife 2001 Annual Report Download - page 6

(1) In 1998, the Company adopted the provisions of Statement of Financial Accounting Standards 125, Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities, with respect to the Company’s securities lending program. Adoption of the provisions had the
effect of increasing assets and liabilities by $3,769 million at December 31, 1998 and increasing revenues and expenses by $266 million for the
year ended December 31, 1998.
(2) Investment gains and losses are presented net of related policyholder amounts. The amounts netted against investment gains and losses are the
following:
For the Years Ended December 31,
2001 2000 1999 1998 1997
(Dollars in millions)
Gross investment (losses) gains********************************** $(737) $(444) $(137) $2,629 $1,018
Less amounts allocable to:
Future policy benefit loss recognition**************************** — — — (272) (126)
Deferred policy acquisition costs ******************************* (25) 95 46 (240) (70)
Participating pension contracts********************************* — (126) 21 (96) (35)
Policyholder dividend obligation ******************************** 159 85 — — —
Total******************************************************* 134 54 67 (608) (231)
Net investment (losses) gains ************************************ $(603) $(390) $ (70) $2,021 $ 787
Investment gains (losses) have been reduced by (i) additions to future policy benefits resulting from the need to establish additional liabilities due to
the recognition of investment gains, (ii) deferred policy acquisition amortization to the extent that such amortization results from investment gains and
losses, (iii) additions to participating contractholder accounts when amounts equal to such investment gains and losses are credited to the
contractholder’s accounts, and (iv) adjustments to the policyholder dividend obligation resulting from investment gains and losses. This presentation
may not be comparable to presentations made by other insurers. This presentation affected operating income and adjusted operating income. See
note 10 below.
(3) Includes the following combined financial statement data of Conning Corporation, which was sold on July 2, 2001, the Company’s controlling
interest in Nvest Companies L.P. and its affiliates, which were sold in 2000, MetLife Capital Holdings, Inc., which was sold in 1998, and the
Company’s Canadian operations and U.K. insurance operations, substantially all of which were sold in 1998 and 1997:
For the Years Ended December 31,
2001 2000 1999 1998 1997
(Dollars in millions)
Total revenues *********************************************** $33 $608 $655 $1,405 $2,149
Total expenses ********************************************** $35 $582 $603 $1,275 $1,870
As a result of these sales, investment gains of $25 million, $663 million, $520 million and $139 million were recorded for the years ended
December 31, 2001, 2000, 1998 and 1997, respectively.
In July 1998, Metropolitan Life sold a substantial portion of its Canadian operations to Clarica Life. As part of that sale, a large block of policies in
effect with Metropolitan Life in Canada were transferred to Clarica Life, and the holders of the transferred Canadian policies became policyholders of
Clarica Life. Those transferred policyholders are no longer policyholders of Metropolitan Life and, therefore, were not entitled to compensation under
the plan of reorganization. However, as a result of a commitment made in connection with obtaining Canadian regulatory approval of that sale and in
connection with the demutualization, Metropolitan Life’s Canadian branch made cash payments to those who were, or were deemed to be, holders
of these transferred Canadian policies. The payments were determined in a manner that is consistent with the treatment of, and fair and equitable to,
eligible policyholders of Metropolitan Life.
(4) Included in 2000 total revenues and total expenses are $3,739 million and $3,561 million, respectively, related to GenAmerica, which was acquired
on January 6, 2000.
(5) Policyholder benefits and claims exclude $(159) million, $41 million, $(21) million, $368 million and $161 million for the years ended December 31,
2001, 2000, 1999, 1998 and 1997, respectively, of future policy benefit loss recognition, credits to participating contractholder accounts and
changes in the policyholder dividend obligation that have been charged against net investment gains and losses as such amounts are directly
related to such gains and losses. This presentation may not be comparable to presentations made by other insurers.
(6) Other expenses exclude $25 million, $(95) million, $(46) million, $240 million and $70 million for the years ended December 31, 2001, 2000, 1999,
1998 and 1997, respectively, of amortization of deferred policy acquisition costs that have been charged against net investment gains and losses
as such amounts are directly related to such gains and losses. This presentation may not be comparable to presentations made by other insurers.
(7) Includes $(145) million, $125 million, $18 million and $(40) million for surplus tax (credited) accrued by Metropolitan Life for the years ended
December 31, 2000, 1999, 1998 and 1997, respectively. Prior to its demutualization, Metropolitan Life was subject to surplus tax imposed on
mutual life insurance companies under Section 809 of the Code. See ‘‘Management’s Discussion and Analysis of Financial Condition and Results of
Operations.’’
(8) Policyholder liabilities include future policy benefits, policyholder account balances, other policyholder funds, policyholder dividends payable and the
policyholder dividend obligation.
(9) For additional information regarding these items, see Note 1 of Notes to Consolidated Financial Statements.
MetLife, Inc. 3