MetLife 2008 Annual Report Download - page 158

Less than
20% 20% or more Less than 20% 20% or more Less than 20% 20% or more
Cost or Amortized Cost Gross Unrealized Loss Number of Securities
December 31, 2007
(In millions, except number of securities)
Fixed Maturity Securities:
Lessthansixmonths.................................. $ 46,343 $1,375 $1,482 $383 4,713 148
Six months or greater but less than nine months . . . . . . . . . . . . . . . . 15,833 14 730 4 1,028 24
Ninemonthsorgreaterbutlessthantwelvemonths.............. 8,529 7 492 2 586 —
Twelvemonthsorgreater............................... 29,893 50 1,162 13 2,692 32
Total ........................................... $100,598 $1,446 $3,866 $402
Equity Securities:
Lessthansixmonths.................................. $ 1,757 $ 423 $ 148 $133 1,212 417
Sixmonthsorgreaterbutlessthanninemonths................ 528 — 62 — 154 —
Ninemonthsorgreaterbutlessthantwelvemonths.............. 439 — 54 — 62 1
Twelvemonthsorgreater............................... 511 — 52 — 90 —
Total ........................................... $ 3,235 $ 423 $ 316 $133
As described more fully in Note 1, the Company performs a regular evaluation, on a security-by-security basis, of its investment
holdings in accordance with its impairment policy in order to evaluate whether such securities are other-than-temporarily impaired. One of
the criteria which the Company considers in its other-than-temporary impairment analysis is its intent and ability to hold securities for a
period of time sufficient to allow for the recovery of their value to an amount equal to or greater than cost or amortized cost. The Company’s
intent and ability to hold securities considers broad portfolio management objectives such as asset/liability duration management, issuer
and industry segment exposures, interest rate views and the overall total return focus. In following these portfolio management objectives,
changes in facts and circumstances that were present in past reporting periods may trigger a decision to sell securities that were held in
prior reporting periods. Decisions to sell are based on current conditions or the Company’s need to shift the portfolio to maintain its
portfolio management objectives including liquidity needs or duration targets on asset/liability managed portfolios. The Company attempts
to anticipate these types of changes and if a sale decision has been made on an impaired security and that security is not expected to
recover prior to the expected time of sale, the security will be deemed other-than-temporarily impaired in the period that the sale decision
was made and an other-than-temporary impairment loss will be recognized.
At December 31, 2008 and 2007, $8.0 billion and $3.9 billion, respectively, of unrealized losses related to fixed maturity securities with
an unrealized loss position of less than 20% of cost or amortized cost, which represented 9% and 4%, respectively, of the cost or amortized
cost of such securities. At December 31, 2008 and 2007, $75 million and $316 million, respectively, of unrealized losses related to equity
securities with an unrealized loss position of less than 20% of cost, which represented 13% and 10%, respectively, of the cost of such
securities.
At December 31, 2008, $20.8 billion and $903 million of unrealized losses related to fixed maturity securities and equity securities,
respectively, with an unrealized loss position of 20% or more of cost or amortized cost, which represented 38% and 43% of the cost or
amortized cost of such fixed maturity securities and equity securities, respectively. Of such unrealized losses of $20.8 billion and
$903 million, $17.2 billion and $519 million related to fixed maturity securities and equity securities, respectively, that were in an unrealized
loss position for a period of less than six months. At December 31, 2007, $402 million and $133 million of unrealized losses related to fixed
maturity securities and equity securities, respectively, with an unrealized loss position of 20% or more of cost or amortized cost, which
represented 28% and 31% of the cost or amortized cost of such fixed maturity securities and equity securities, respectively. Of such
unrealized losses of $402 million and $133 million, $383 million and $133 million related to fixed maturity securities and equity securities,
respectively, that were in an unrealized loss position for a period of less than six months.
The Company held 699 fixed maturity securities and 33 equity securities, each with a gross unrealized loss at December 31, 2008 of
greater than $10 million. These 699 fixed maturity securities represented 50% or $14.5 billion in the aggregate, of the gross unrealized loss
on fixed maturity securities. These 33 equity securities represented 71% or $699 million in the aggregate, of the gross unrealized loss on
equity securities. The Company held 23 fixed maturity securities and six equity securities, each with a gross unrealized loss at
December 31, 2007 of greater than $10 million. These 23 fixed maturity securities represented 8% or $357 million in the aggregate,
of the gross unrealized loss on fixed maturity securities. These six equity securities represented 20% or $90 million in the aggregate, of the
gross unrealized loss on equity securities. The fixed maturity and equity securities, each with a gross unrealized loss greater than
$10 million increased $14.7 billion during the year ended December 31, 2008. These securities were included in the regular evaluation of
whether such securities are other-than-temporarily impaired. Based upon the Company’s current evaluation of these securities in
accordance with its impairment policy, the cause of the decline being primarily attributable to a rise in market yields caused principally
by an extensive widening of credit spreads which resulted from a lack of market liquidity and a short-term market dislocation versus a long-
term deterioration in credit quality, and the Company’s current intent and ability to hold the fixed maturity and equity securities with
unrealized losses for a period of time sufficient for them to recover, the Company has concluded that these securities are not other-than-
temporarily impaired.
F-35MetLife, Inc.
MetLife, Inc.
Notes to the Consolidated Financial Statements — (Continued)