MetLife 2008 Annual Report Download - page 176

6. Goodwill
Goodwill is the excess of cost over the estimated fair value of net assets acquired. Information regarding goodwill is as follows:
2008 2007 2006
December 31,
(In millions)
Balanceatbeginningoftheperiod..................................... $4,814 $4,801 $4,701
Acquisitions(1).................................................. 256 2 93
Other,net(2) ................................................... (62) 11 7
Balanceattheendoftheperiod ...................................... $5,008 $4,814 $4,801
(1) See Note 2 for a description of acquisitions and dispositions.
(2) Consisting principally of foreign currency translation adjustments.
Information regarding goodwill by segment and reporting unit is as follows:
2008 2007
December 31,
(In millions)
Institutional:
Grouplife .......................................................... $ 15 $ 15
Retirement&savings................................................... 887 887
Non-medicalhealth&other............................................... 149 76
Subtotal.......................................................... 1,051 978
Individual:
Traditionallife........................................................ 73 73
Variable&universallife.................................................. 1,174 1,174
Annuities........................................................... 1,692 1,692
Other ............................................................. 18 18
Subtotal.......................................................... 2,957 2,957
International:
LatinAmericaregion ................................................... 184 104
Europeanregion ...................................................... 37 50
AsiaPacificregion..................................................... 152 159
Subtotal.......................................................... 373 313
Auto&Home.......................................................... 157 157
Corporate&Other(1)..................................................... 470 409
Total ............................................................... $5,008 $4,814
(1) The allocation of the goodwill to the reporting units was performed at the time of the respective acquisition. The $470 million of goodwill
within Corporate & Other relates to goodwill acquired as a part of the Travelers acquisition of $405 million, as well as acquisitions by
MetLife Bank which resides within Corporate & Other. For purposes of goodwill impairment testing at December 31, 2008 and 2007, the
$405 million of Corporate & Other goodwill has been attributed to the Individual and Institutional segment reporting units. The Individual
segment was attributed $210 million, (traditional life — $23 million, variable & universal life — $11 million and annuities — $176 million)
and the Institutional segment was attributed $195 million, (group life — $2 million, retirement & savings — $186 million, and non-medical
health & other — $7 million) at both December 31, 2008 and 2007.
As described in more detail in Note 1, the Company performed its annual goodwill impairment tests during the third quarter of 2008
based upon data as of June 30, 2008. Such tests indicated that goodwill was not impaired as of September 30, 2008. Current economic
conditions, the sustained low level of equity markets, declining market capitalizations in the insurance industry and lower operating
earnings projections, particularly for the Individual segment, required management of the Company to consider the impact of these events
on the recoverability of its assets, in particular its goodwill. Management concluded it was appropriate to perform an interim goodwill
impairment test at December 31, 2008. Based upon the tests performed management concluded no impairment of goodwill had occurred
for any of the Company’s reporting units at December 31, 2008.
Management continues to evaluate current market conditions that may affect the estimated fair value of the Company’s reporting units
to assess whether any goodwill impairment exists. Continued deteriorating or adverse market conditions for certain reporting units may
have a significant impact on the estimated fair value of these reporting units and could result in future impairments of goodwill.
F-53MetLife, Inc.
MetLife, Inc.
Notes to the Consolidated Financial Statements — (Continued)