The paragraph introduces a conference call for MetLife's fourth-quarter and full-year 2024 earnings and outlook. The call, which is currently in listen-only mode, will later include a Q&A session. The conference is being recorded, and participants are directed to review forward-looking statements and risk factors in MetLife's SEC filings. John Hall, the Global Head of Investor Relations, thanks attendees and points to non-GAAP measures and other information on MetLife's website. John McCallion, the CFO, will discuss supplemental slides related to the quarter and outlook. President and CEO Michel Khalaf will also make remarks, with the call concluding with a Q&A session. Participants are asked to limit themselves to one question and follow-up.

MetLife, Inc. reported strong fourth-quarter and full-year results for 2024, showcasing the resilience of its business portfolio amid economic uncertainties. Despite challenges like a global pandemic and volatile interest rates, the company met its Next Horizon strategy financial commitments, outperforming the S&P 500 index. As the Next Horizon period ended, MetLife introduced its New Frontier strategy, emphasizing growth through four strategic priorities: enhancing group benefits, leveraging its retirement platform, accelerating asset management growth, and expanding in high-growth international markets. The new strategy builds on focus, simplicity, and differentiation while positioning the company for responsible growth.

The paragraph discusses MetLife, Inc.'s new strategic initiatives under their New Frontier strategy, aimed at enhancing shareholder value. Key moves include forming a Bermuda-based reinsurance company, Cherry Tree, in partnership with General Atlantic and Chubb, to address global life and retirement solution demands. Additionally, MetLife announced the acquisition of PineBridge Investments to bolster its asset management capabilities, as well as the acquisition of teams from Mesero Financial. MetLife is committed to double-digit adjusted EPS growth and has increased its return on equity target, emphasizing both business growth and disciplined capital management.

In the fourth quarter of 2024, MetLife, Inc. reported an increase in adjusted earnings to $1.5 billion, or $2.09 per share, reflecting a 14% rise from the previous year. The company exceeded its prior five-year financial commitments by aiming for an additional 100 basis point reduction in its direct expense ratio and raising its free cash flow target to $25 billion. The firm's strong performance was attributed to higher variable investment income and solid business momentum, resulting in a full-year adjusted ROE of 15.2%, surpassing their targets. The group's benefits business, seen as a leading segment within the US life insurance market, achieved adjusted earnings of $1.7 billion and an 8% increase in sales, driven by growth in national accounts. MetLife, Inc. attributes this growth to its scale, technology, and disciplined approach, aiming for continued expansion through enhanced employer, product, and employee engagement.

In 2024, MetLife, Inc. demonstrated robust financial performance across various segments, with Retirement and Income Solutions (RIS) generating $1.6 billion in adjusted earnings. The company saw growth in liability exposures, driven by contributions from structured settlements and other areas. Asia's earnings increased significantly, while the Latin America business achieved record earnings despite currency challenges. MetLife's diversified portfolio and balanced earnings among its top segments contributed to strong overall performance. Despite some buyback restrictions in the fourth quarter, MetLife repurchased $3.2 billion of common stock and distributed $1.5 billion in dividends, returning a total of $4.7 billion to shareholders in 2024.

The paragraph discusses MetLife, Inc.'s transition from its "Next Horizon" to "New Frontier" strategy in 2024, focusing on responsible growth and attractive returns. The company operates in competitive markets and is well-positioned to leverage global tailwinds. John McCallion then reviews MetLife's financial performance and outlook, highlighting a net income of $1.2 billion for Q4 and $4.2 billion for the full year of 2024. Differences between net income and adjusted earnings are due to net derivative losses and offsetting gains from higher interest rates. Additionally, notable financial items include a positive impact from a tax refund and a negative impact from increased asbestos litigation reserves.

The paragraph discusses the financial performance in the fourth quarter, highlighting a 1% increase in adjusted earnings to $1.4 billion, or 3% on a constant currency basis, largely due to higher variable investment income and volume growth. Adjusted earnings per share rose 8%, or 10% on a constant currency basis. Group benefits adjusted earnings decreased by 11% due to less favorable nonmedical health underwriting margins. However, the group life mortality ratio improved to the low end of the annual target range. Group benefits adjusted PFOs increased by 4% for the year, aligning with the target growth range when adjusting for dampened growth factors. RIS adjusted earnings fell 8% due to lower recurring interest margins and underwriting, though variable investment income and volume growth boosted results. RIS total investment spreads increased slightly due to higher variable investment income.

In the article's paragraph, RIS adjusted PFOs increased by 26% due to product growth, particularly in PRT and UK funded reinsurance, with total PRT inflows reaching $6.7 billion for 2024. In Asia, adjusted earnings rose 50% (52% constant currency) due to higher variable investment income and favorable underwriting margins, with positive reserve refinements contributing $30 million. General account assets increased by 5% year-over-year, while sales decreased by 5% mainly due to a decline in Japan, impacted by yen volatility. However, other Asian markets like Korea, India, and China saw substantial growth. In Latin America, adjusted earnings fell by 3% but improved by 10% on a constant currency basis due to higher volume growth, while adjusted PFOs decreased by 3% but increased by 9% constant currency. EMEA's adjusted earnings rose by 26% (31% constant currency), driven by volume growth and lower tax charges, despite less favorable expense and underwriting margins.

The paragraph provides a financial update on MetLife's performance in the EMEA region and other segments for the fourth quarter and full year 2024. EMEA's adjusted PFOs rose by 10% and 13% on a constant currency basis due to strong regional sales. MetLife Holdings' adjusted earnings were $153 million, down 2% because of foregone earnings from a reinsurance transaction, partially offset by favorable life underwriting. The corporate and other segment reported a higher adjusted loss of $209 million, influenced by increased expenses and taxes, although bolstered by higher variable investment income. The effective tax rate was 23.5%, slightly below the 2024 guidance. Q4 variable investment income was $293 million, driven by the private equity portfolio, though overall for 2024, it was $1 billion, below the target but better than the previous year, with real estate funds being the primary shortfall contributors. The Asia segment notably outperformed in variable investment income, generating over 50% of the total.

The paragraph discusses financial performance highlights for MetLife, Inc., particularly focusing on the direct expense ratio, cash and capital positions, and meeting financial commitments. In Q4 2024, the direct expense ratio was 13.1% due to seasonal costs, but for the full year, it was 12.1%, beating the target. The company repurchased $400 million in shares in Q4 and $470 million in January. Preliminary statutory operating earnings for US companies were approximately $4 billion, with net income around $2.9 billion, reflecting a decrease due to reinsurance impacts and lower investment income, offset by favorable underwriting. MetLife surpassed its five-year financial commitments, achieving an adjusted ROE of 15.2% for 2024, exceeding both original and updated targets, and surpassed its distributable cash and operating leverage capacity goals.

The paragraph outlines the company's near-term financial outlook. Key points include an expected strengthening of the US dollar, creating a potential $150 to $175 million headwind to adjusted earnings by 2025, with the impact particularly affecting non-US segments. Long-term interest rates are projected to remain stable, and the yield curve is expected to steepen positively. The company anticipates a 5% annual return for the S&P 500 and aims for double-digit growth in adjusted earnings per share. It expects an adjusted return on equity of 15% to 17% and plans to maintain a two-year average free cash flow ratio of 65% to 75% of adjusted earnings, supporting a goal of generating over $25 billion in free cash flow in five years. The company plans to reduce its expense ratio to 11.3% by 2029, lowering direct expense ratio guidance for 2025 to 12.1%. Variable investment income is projected at $1.7 billion pretax for 2025, with corporate and other adjusted losses estimated between $850 and $950 million after tax. The effective tax rate is expected to stay within 24% to 26%. Interest rate sensitivities suggest minimal impact on near-term adjusted earnings, and further details are provided in an appendix. The next page projects stable average asset balances for variable investment income in 2025.

The paragraph discusses expected financial returns and growth targets across various business segments. The company is projecting near-term annual returns of 9% to 11% for private equity and 7% to 9% for real estate and other funds, with expectations for lower returns in 2025, followed by an increase in 2026 and 2027. Specifically for U.S. group benefits, the company is raising its adjusted growth target to 4% to 7% annually and maintaining current underwriting guidance ranges. They anticipate that if recent positive trends continue, the group life mortality ratio could be at the lower end of the range by 2025. Adjusted earnings for group benefits are expected to increase by 5% to 10% due to product mix changes, improved efficiencies, and higher investment income. Additionally, the company is raising its total liability annual growth guidance for RIS to 3% to 5% in response to opportunities under the New Frontier initiative.

The paragraph outlines financial projections and guidance for the upcoming years. The general account investment spread for 2025 is expected to be between 110 and 135 basis points, stabilizing post-2025 as interest rate caps mature. Additional fee and underwriting income could boost RIS adjusted earnings by 5%. For MetLife Holdings, adjusted earnings are expected to range from $650 to $800 million in 2025, with a projected decline in adjusted PFOs and accelerated business run-off. In Asia, sales and adjusted earnings are expected to grow mid to high single digits on a constant currency basis, with adjustments for yen weakness. In Latin America, both adjusted PFOs and earnings are forecasted to grow high single digits on a constant currency basis by 2025, but remain flat on a reported basis due to weakening currencies. Growth is expected to continue into 2026 and 2027 across these regions.

The paragraph discusses MetLife, Inc.'s optimistic financial outlook for the EMEA region, with expectations of mid to high single-digit growth in adjusted PFOs and a new quarterly run rate for adjusted earnings of $70 to $75 million in 2025, followed by mid-single-digit growth through 2027. The company closes a successful year, highlighting its strong fundamentals, balance sheet, cash flow, and diversified business portfolio. As MetLife transitions from its "Next Horizon" journey to the "New Frontier," it focuses on strategic priorities to achieve responsible growth and attractive returns with reduced risk. Following this statement, the operator opens the floor for questions, with Ryan Krueger from KBW inquiring about group renewals, to which Ramy Tadros responds positively, noting satisfactory renewals and persistency.

The paragraph discusses the strong performance and promising start of MetLife's dental and Pension Risk Transfer (PRT) businesses. MetLife is confident in its PFO guidance increase due to solid renewal actions in its dental business. Despite lawsuits affecting other PRT market players, MetLife remains unaffected and reports robust activity with $6.4 billion of inflows last year and a $640 million plan in early 2025. The company acknowledges the established nature of the PRT market, governed by regulatory frameworks, and anticipates continued interest and growth based on market fundamentals.

The paragraph discusses the impact of voluntary benefit loss ratios and dental repricing on nonmedical health loss ratios. Ramy Tadros mentions that their accident health segment hasn't seen significant deviations from expected ranges and continues to experience robust growth with solid margins. For 2025, they plan to start at the midpoint of their nonmedical health loss ratio range, considering some improvements in dental, which is expected to be better than in 2024. Tom Gallagher agrees that targeting a point better is a reasonable base case.

In the paragraph, John McCallion explains the decision to raise alternative return assumptions for 2025, citing a combination of improving conditions in both private equity and real estate markets. He notes that while public equity markets have been strong, this hasn't fully translated to private markets yet, but there are signs of positive trends such as increased exit activity and a more business-friendly environment, suggesting potential growth. The private equity returns were close to or on target with past guidance, prompting a slight increase in projections. The real estate market underperformed last year but shows signs of stabilization and recovery, contributing to the optimistic outlook for 2025.

The paragraph discusses financial projections, focusing on the RIS spread guidance. It explains that although the projected spread for 2025 appears slightly lower than initial guidance for 2024, there is an expected recovery in VII and stabilization in core spreads. The speaker, John McCallion, clarifies that the total spread in 2025, projected to be between 110 to 135 basis points, is anticipated to be above the actual spread for 2024. The hedges had been used to protect against sharp interest rate increases in 2024 but are now rolling off, leading to the stabilization of core spreads into 2025.

The paragraph discusses the expectations for the business in the near future, mentioning potential pressures and the benefits of adjusting the portfolio. It highlights the stability anticipated in their core spread and the positive impact of new business ventures. The conversation then shifts to Cherry Tree, a joint venture with General Atlantic, with excitement expressed about the growth opportunities it presents. Questions are raised about the types of business Cherry Tree could handle, such as PRT or retail annuities, and whether it could operate domestically and internationally. Michel Khalaf expresses satisfaction with the progress made and the future potential of Cherry Tree.

The paragraph discusses a strategic partnership between the company and Cherry Tree to enhance capital flexibility and foster growth. Initially, liabilities will be sourced through MetLife, Inc., but there's potential for Cherry Tree to reinsure liabilities from third parties in the future. This growth is aimed at generating high-value earnings for MetLife Investment Management (MIM). The conversation then shifts to a question from Alex Scott of Barclays, inquiring about the potential impact on MetLife Investment Management if an asset manager, possibly private equity-backed, became involved in managing a general account. John McCallion responds by stating that they do not comment on specific client P&Ls.

The paragraph features a conversation between two individuals, where the first speaker highlights the value and pride they have in maintaining a strong client relationship, emphasizing their unique value proposition and capabilities at MetLife Investment Management. They acknowledge the inevitability of changes over time but express confidence in their diversified client base and growth potential. The second speaker, Alex Scott, shifts the topic to capital deployment, inquiring about the amount of statutory capital behind the holdings business and potential opportunities for inorganic growth. John McCallion responds, suggesting the question is too broad but reiterates their effective management of MetLife Holdings.

The paragraph involves a conversation during a conference call, where the speaker discusses their firm's approach to evaluating opportunities that are beneficial from a risk-adjusted perspective. The firm considers various factors and the diversification benefits in decision-making and feels confident in managing assets independently if necessary. In response to a question by Wes Carmichael from Autonomous Research, another speaker, Ramy Tadros, indicates that the long-term care market has seen increased activity in risk transfer, suggesting a positive trend in negotiations between cedents and reinsurers. However, he notes that such transactions are complex and time-consuming to execute.

The paragraph discusses the objectives of a risk transfer deal, focusing on maximizing shareholder value while maintaining customer service. Price and structure are crucial for these deals. The company's book is well-capitalized and well-reserved, adhering to New York DFS standards and performing as expected. They have a successful rate action program for premium increases. John McCallion explains that the business block is still growing its liabilities, not generating much cash flow yet. Wes Carmichael asks about positive trends in group life, and Ramy Tadros attributes favorable trends to CDC data, particularly for the working-age population, which benefits the company's ratios and explains why results were better than expected for 2024.

In the paragraph, the discussion centers around the outlook for population mortality trends and their potential impact on the mortality ratio by 2025, suggesting positive trends may lead to results in the lower half of their guidance range. The conversation then shifts to addressing concerns about commercial real estate and pension reform in Latin America. John McCallion notes that while there has been pressure on commercial mortgages, there are signs of optimism due to strong economic growth and improving real estate fundamentals, particularly in office spaces. Additionally, questions about pension reforms in Latin America, specifically in Chile, highlight concerns about potential nationalization of some ESP businesses. However, John doesn't provide specific insights into the situation in Chile.

The paragraph discusses the current state of the real estate market, highlighting increased lease signings and low construction activity, which may lead to a market shift. Vacancy rates are at or below historical averages, and transaction volumes, including sales gains, are rising. The speaker believes the market is approaching a cyclical peak or trough, and loan-to-value ratios have likely stabilized. Most losses have been reserved for, and the impact of the cycle is nearly settled, with potential minor adjustments. The shift to discussing Chile's pension reform notes its approval after years of debate, providing clarity and outlining three main takeaways.

The paragraph discusses a company's approach to pension system reform and its impact on operations. The company expects minimal disruption and remains committed to providing quality pension management services. During an investor call, Elyse Greenspan from Wells Fargo asks about the earnings of MIM, a component within corporate, and its future growth outlook. John McCallion responds that they plan to begin breaking out MIM as a separate segment in 2025, aligning it with a transaction involving PineBridge, and that current earnings and growth estimates are spread across corporate results. He advises sticking to the current segmentation for modeling purposes until the changes take effect. Additionally, he appreciates the team for making model updates easier.

The paragraph discusses the financial outlook and currency assumptions for a company, focusing on potential risks to international earnings due to currency fluctuations in 2025. John McCallion confirms they use the 12/31 forward curves for currency assumptions, noting changes primarily in Latin America and Asia, with some expected weakening of spot rates. Despite currency pressures being a potential headwind, the company is actively working on obtaining regulatory approvals, aiming to close deals by the second half of 2025. The discussion ends with closing remarks from John Hall, thanking participants for joining the call.

This summary was generated with AI and may contain some inaccuracies.