MetLife 3Q profit dips

MetLife 3Q profit dips

	Published : Wed, 31 Oct 2007 22:09 By : Agencies Print this Story

NEW YORK (AP) - MetLife Inc. on Wednesday reported third-quarter profit edged lower, as the No. 1 U.S. life insurer suffered $270 million of losses from investments used to hedge its insurance portfolio.

Quarterly profit after paying preferred dividends fell to $985 million, or $1.29 per share, from $999 million, or $1.29 per share, in the same period a year earlier. MetLife had more shares outstanding in the year-ago period.

Operating earnings, which strips out investment losses, rose to $1.52 per share from $1.24 per share for the year-earlier quarter. Revenue rose to $13.06 billion from $12.53 billion in the year-ago period.

Analysts were calling for a profit of $1.39 per share on revenue of $13.45 billion, according to analysts polled by Thomson Financial.

Like most insurers, MetLife parks the premiums it collects in investments like stocks and bonds. As investments tied to the value of mortgage debt plunged, there had been concern abut how much exposure MetLife had in its $333.4 billion investment portfolio.

MetLife said it booked losses from its investment portfolio amid the market's turbulence. The company had net losses of $215 million pinned on derivatives and other financial instruments, and $25 million from hedge fund positions.

The company did not break out further information about its investment portfolio.

The New York-based company also reported that higher expenses and lower underwriting margins caused its life insurance operating earnings to tumble to $117 million from $167 million a year earlier. This led to a drop in earnings for its individual business earnings to $363 million from $367 million a year ago.

However, MetLife said its international business garnered higher annuity sales in Japan and Korea. This helped push up the division's operating earnings by 20 percent to $467 million.

Auto and home insurance earnings edged higher to $109 million as lower catastrophe costs were somewhat outweighed by tougher market competition.

MetLife saw strong annuity sales rose 22 percent to $4.4 billion in the quarter. Meanwhile, assets rose to a record $563.1 billion.

Shares added 21 cents to end regular trading at $68.85, but fell 44 cents to $68.41 in after-hours trading.