MetLife profit misses estimate as claims rise

Wed Oct 30, 2013 5:18pm EDT

A statue stands atop Grand Central Station in front of the MetLife building in New York, October 8, 2008. REUTERS/Lucas Jackson

A statue stands atop Grand Central Station in front of the MetLife building in New York, October 8, 2008.

Credit: Reuters/Lucas Jackson

(Reuters) - MetLife Inc (MET.N) reported a third-quarter profit that narrowly missed analysts' estimates as the largest U.S. life insurer paid more in claims and benefits to policyholders, sending its shares down about 3 percent after the bell.

The insurer reported a net profit of $942 million, or 84 cents per share, for the quarter ended September 30.

It had posted a loss of $984 million, or 92 cents per share, a year earlier as it took a goodwill impairment charge of $1.6 billion on its U.S. retail annuity business.

Total claims and benefits paid rose 3.5 percent to $9.31 billion. Premium revenue, however, remained flat at $9.09 billion.

On an operating basis, the insurer earned $1.34 per share. Analysts had expected earnings of $1.36 per share, according to Thomson Reuters I/B/E/S.

Operating earnings were boosted by strong results across its retail business in the Americas division. Retail earnings rose 34 percent to $659 million due to better expense management.

MetLife's net derivative losses narrowed to $476 million for the third quarter, from $543 million, a year earlier.

The company has long had a substantial derivatives program to smooth out the risk of low interest rates that have been squeezing the interest incomes of insurers.

Net investment income remained flat at $5.04 billion, as historically low interest rates continued to persist.

Low interest rates have led MetLife to focus on alternative businesses to boost profit. The company bought BBVA's (BBVA.MC) Chilean pension fund for about $2 billion earlier this year to expand its presence in emerging markets.

MetLife's shares closed at $49 on the New York Stock Exchange on Wednesday.

(Reporting by Avik Das in Bangalore; Editing by Rodney Joyce and Don Sebastian)

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California state worker Albert Jagow (L) goes over his retirement options with Calpers Retirement Program Specialist JeanAnn Kirkpatrick at the Calpers regional office in Sacramento, California October 21, 2009. Calpers, the largest U.S. public pension fund, manages retirement benefits for more than 1.6 million people, with assets comparable in value to the entire GDP of Israel. The Calpers investment portfolio had a historic drop in value, going from a peak of $250 billion in the fall of 2007 to $167 billion in March 2009, a loss of about a third during that period. It is now around $200 billion. REUTERS/Max Whittaker   (UNITED STATES) - RTXPWOZ

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