MetLife 2011 Annual Report Download - page 173

MetLife, Inc.
Notes to the Consolidated Financial Statements — (Continued)
Fair Value Option
Residential Mortgage Loans Held-For-Sale
The following table presents residential mortgage loans held-for-sale carried under the FVO at:
December 31,
2011 2010
(In millions)
Unpaid principal balance ................................................................... $2,935 $2,473
Excess of estimated fair value over unpaid principal balance ........................................ 129 37
Carrying value at estimated fair value ........................................................ $3,064 $2,510
Loans in non-accrual status ................................................................. $ 3 $ 2
Loans more than 90 days past due ........................................................... $ 20 $ 3
Loans in non-accrual status or more than 90 days past due, or both — difference between aggregate
estimated fair value and unpaid principal balance ............................................... $ (2) $ (1)
Residential mortgage loans held-for-sale accounted for under the FVO are initially measured at estimated fair value. Interest income on residential
mortgage loans held-for-sale is recorded based on the stated rate of the loan and is recorded in net investment income. Gains and losses from initial
measurement, subsequent changes in estimated fair value and gains or losses on sales are recognized in other revenues. Such changes in estimated
fair value for these loans were due to the following:
Years Ended December 31,
2011 2010 2009
(In millions)
Instrument-specific credit risk based on changes in credit spreads for non-agency loans and
adjustments in individual loan quality .................................................... $ (3) $ (1) $ (2)
Other changes in estimated fair value ..................................................... 511 487 600
Total gains (losses) recognized in other revenues .......................................... $508 $486 $598
Securitized Reverse Residential Mortgage Loans
The following table presents securitized reverse residential mortgage loans carried under the FVO at:
December 31, 2011
(In millions)
Unpaid principal balance ..................................................................... $6,914
Excess of estimated fair value over unpaid principal balance .......................................... 738
Carrying value at estimated fair value .......................................................... $7,652
Loans in non-accrual status ................................................................... $ —
Loans more than 90 days past due ............................................................. $ 59
Loans in non-accrual status or more than 90 days past due, or both — difference between aggregate estimated
fair value and unpaid principal balance ......................................................... $ —
Securitized reverse residential mortgage loans accounted for under the FVO are initially measured at estimated fair value. Gains and losses from
initial measurement and subsequent changes in estimated fair value are recognized in other revenues.
The following table presents the liability related to securitized reverse residential mortgage loans carried under the FVO at:
December 31, 2011
(In millions)
Contractual principal balance .................................................................. $6,914
Excess of estimated fair value over contractual principal balance ...................................... 712
Carrying value at estimated fair value .......................................................... $7,626
The liability related to securitized reverse residential mortgage loans accounted for under the FVO is initially measured at estimated fair value. Gains
and losses from initial measurement and subsequent changes in estimated fair value are recognized in other revenues.
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