MetLife 2007 Annual Report Download - page 8

Real Estate
In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets (“SFAS 144”), income related to real estate sold or classified as held-for-sale for transactions initiated on or after
January 1, 2002 is presented as discontinued operations. The following information presents the components of income from
discontinued real estate operations:
2007 2006 2005 2004 2003
Years Ended December 31,
(In millions)
Investmentincome.................................. $59 $ 276 $ 435 $690 $763
Investmentexpense................................. (43) (182) (273) (418) (452)
Netinvestmentgains(losses)........................... 13 4,795 2,125 146 420
Totalrevenues................................... 29 4,889 2,287 418 731
Interestexpense................................... — — — 13 4
Provisionforincometax .............................. 11 1,727 813 143 266
Income from discontinued operations, net of income tax . . . . . . . . $ 18 $3,162 $1,474 $ 262 $ 461
Operations
In September 2007, September 2005 and January 2005, the Company sold its MetLife Insurance Limited (“MetLife Australia”)
annuities and pension businesses, P.T. Sejahtera (“MetLife Indonesia”) and SSRM Holdings, Inc. (“SSRM”), respectively. In accordance
with SFAS 144, the assets, liabilities and operations of MetLife Indonesia, SSRM and MetLife Australia have been reclassified into
discontinued operations for all years presented. The following tables present these discontinued operations:
2007 2006 2005 2004 2003
Years Ended December 31,
(In millions)
Revenues ........................................ $71 $ 100 $ 74 $333 $235
Expenses......................................... 58 89 89 310 206
Incomebeforeprovisionforincometax ..................... 13 11 (15) 23 29
Provisionforincometax ............................... 4 3 (2) 13 13
Income (loss) from discontinued operations, net of income tax . . . . . 9 8 (13) 10 16
Netinvestmentgains,netofincometax..................... 10 52 182 — —
Income from discontinued operations, net of income tax . . . . . . . . . $19 $ 60 $ 169 $ 10 $ 16
2006 2005 2004 2003
December 31,
(In millions)
Generalaccountassets ............................... $1,563 $1,621 $410 $210
Totalassets...................................... $1,563 $1,621 $410 $210
Lifeandhealthpolicyholderliabilities(4) ..................... $1,595 $1,622 $ 24 $ 17
Short-termdebt..................................... — — 19 —
Other ........................................... — — 225 73
Totalliabilites..................................... $1,595 $1,622 $268 $ 90
(3) The cumulative effect of a change in accounting, net of income tax, of $86 million for the year ended December 31, 2004, resulted from
the adoption of SOP 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for
Separate Accounts. The cumulative effect of a change in accounting, net of income tax, of $26 million for the year ended December 31,
2003, resulted from the adoption of SFAS No. 133 Implementation Issue No. B36, Embedded Derivatives: Modified Coinsurance
Arrangements and Debt Instruments That Incorporate Credit Risk Exposures That Are Unrelated or Only Partially Related to the
Creditworthiness of the Obligor under Those Instruments.
(4) Policyholder liabilities include future policy benefits, other policyholder funds and bank deposits. The life and health policyholder liabilities
also include policyholder account balances, policyholder dividends payable and the policyholder dividend obligation.
(5) The cumulative effect of changes in accounting, net of income tax, of $329 million, which decreased retained earnings at January 1, 2007,
resulted from $292 million related to the adoption of SOP 05-1, Accounting by Insurance Enterprises for Deferred Acquisition Costs in
Connection with Modifications or Exchanges of Insurance Contracts, and $37 million related to the adoption of Financial Accounting
Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109.
(6) The cumulative effect of a change in accounting, net of income tax, of $744 million resulted from the adoption of SFAS No. 158,
Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, and decreased accumulated other comprehensive
income at December 31, 2006.
(7) Return on common equity is defined as net income available to common shareholders divided by average common stockholders’ equity.
4MetLife, Inc.