MetLife 2011 Annual Report Download - page 81

MetLife, Inc. lends funds, as necessary, to its subsidiaries, some of which are regulated, to meet their capital requirements. Such loans are included
in loans to subsidiaries and consisted of the following at:
December 31,
Subsidiaries Interest Rate Maturity Date 2011 2010
(In millions)
Metropolitan Life Insurance Company(1) ............. Six-month LIBOR + 1.80% December 31, 2011 $— $ 775
Metropolitan Life Insurance Company(2) ............. 7.13% December 15, 2032 — 400
Metropolitan Life Insurance Company(2) ............. 7.13% January 15, 2033 — 100
Total ....................................... $— $1,275
(1) In April 2011, MLIC repaid in cash the $775 million surplus note issued to MetLife, Inc. in December 2009. The early redemption was approved by
the New York Superintendent of Insurance.
(2) On December 15, 2011, MLIC repaid in cash the $400 million and $100 million capital notes issued to MetLife, Inc. in December 2002.
In September and November 2011, American Life issued notes to MetLife, Inc. for $100 million and $270 million, respectively. American Life repaid
both notes during the fourth quarter of 2011.
Debt Repayments. In December 2011, MetLife, Inc. repaid the $750 million senior note with an interest rate of 6.13%. MetLife, Inc. intends to
repay all or refinance in whole or in part the debt that is due in 2012. See “— MetLife, Inc. — Liquidity and Capital Sources — Senior Notes.”
Support Agreements. MetLife, Inc. is party to various capital support commitments and guarantees with certain of its subsidiaries. Under these
arrangements, MetLife, Inc. has agreed to cause each such entity to meet specified capital and surplus levels or has guaranteed certain contractual
obligations.
In June 2011, MetLife, Inc. guaranteed the obligations of its subsidiary, DelAm, under a stop loss reinsurance agreement with RGA Reinsurance
(Barbados) Inc. (“RGARe”), pursuant to which RGARe retrocedes to DelAm a portion of the whole life medical insurance business that RGARe assumed
from American Life on behalf of its Japan branch.
Prior to the sale in April 2011 of its 50% interest in MSI MetLife to a third party, MetLife, Inc. guaranteed the obligations of its subsidiary, Exeter
Reassurance Company, Ltd. (“Exeter”), under a reinsurance agreement with MSI MetLife, under which Exeter reinsures variable annuity business written
by MSI MetLife. This guarantee will remain in place until such time as the reinsurance agreement between Exeter and MSI MetLife is terminated,
notwithstanding the April 2011 disposition of MetLife, Inc.’s interest in MSI MetLife as described in Note 2 of the Notes to the Consolidated Financial
Statements.
In March 2011, MetLife, Inc. guaranteed the obligations of its subsidiary, Missouri Reinsurance (Barbados) Inc. (“MoRe”), under a retrocession
agreement with RGARe, pursuant to which MoRe retrocedes a portion of the closed block liabilities associated with industrial life and ordinary life
insurance policies that it assumed from MLIC.
In November 2010, MetLife, Inc. guaranteed the obligations of Exeter in an aggregate amount up to $1.0 billion, under a reinsurance agreement with
MetLife Europe Limited (“MEL”), under which Exeter reinsures the guaranteed living benefits and guaranteed death benefits associated with certain unit-
linked annuity contracts issued by MEL.
In January 2010, MetLife, Inc. guaranteed the obligations of MoRe, under a retrocession agreement with RGARe, pursuant to which MoRe
retrocedes certain group term life insurance liabilities that it assumed from MLIC.
In December 2009, MetLife, Inc., in connection with MetLife Reinsurance Company of Vermont’s (“MRV”) reinsurance of certain universal life and
term life insurance risks, committed to the Vermont Department of Banking, Insurance, Securities and Health Care Administration to take necessary
action to cause the third protected cell of MRV to maintain total adjusted capital equal to or greater than 200% of such protected cell’s authorized
control level RBC, as defined in state insurance statutes. See “— The Company — Liquidity and Capital Sources — Credit and Committed Facilities”
and Note 11 of the Notes to the Consolidated Financial Statements.
MetLife, Inc., in connection with MRV’s reinsurance of certain universal life and term life insurance risks, committed to the Vermont Department of
Banking, Insurance, Securities and Health Care Administration to take necessary action to cause each of the two initial protected cells of MRV to
maintain total adjusted capital equal to or greater than 200% of such protected cell’s authorized control level RBC, as defined in state insurance
statutes. See “— The Company — Liquidity and Capital Sources — Credit and Committed Facilities” and Note 11 of the Notes to the Consolidated
Financial Statements.
MetLife, Inc., in connection with the collateral financing arrangement associated with MRC’s reinsurance of a portion of the liabilities associated with
the closed block, committed to the South Carolina Department of Insurance to make capital contributions, if necessary, to MRC so that MRC may at all
times maintain its total adjusted capital at a level of not less than 200% of the company action level RBC, as defined in state insurance statutes as in
effect on the date of determination or December 31, 2007, whichever calculation produces the greater capital requirement, or as otherwise required by
the South Carolina Department of Insurance. See “— The Company — Liquidity and Capital Sources — Debt Issuances and Other Borrowings” and
Note 12 of the Notes to the Consolidated Financial Statements.
MetLife, Inc., in connection with the collateral financing arrangement associated with MRSC’s reinsurance of universal life secondary guarantees,
committed to the South Carolina Department of Insurance to take necessary action to cause MRSC to maintain total adjusted capital equal to the
greater of $250,000 or 100% of MRSC’s authorized control level RBC, as defined in state insurance statutes. See “— The Company — Liquidity and
Capital Sources — Debt Issuances and Other Borrowings” and Note 12 of the Notes to the Consolidated Financial Statements.
MetLife, Inc. has net worth maintenance agreements with two of its insurance subsidiaries, MLIIC and First MetLife Investors Insurance Company.
Under these agreements, as subsequently amended, MetLife, Inc. agreed, without limitation as to the amount, to cause each of these subsidiaries to
have a minimum capital and surplus of $10 million, total adjusted capital at a level not less than 150% of the company action level RBC, as defined by
state insurance statutes, and liquidity necessary to enable it to meet its current obligations on a timely basis.
MetLife, Inc. also guarantees the obligations of a number of its subsidiaries under credit facilities with third-party banks. See Note 11 of the Notes to
the Consolidated Financial Statements.
Adoption of New Accounting Pronouncements
See Note 1 of the Notes to the Consolidated Financial Statements.
MetLife, Inc. 77