UPDATE 2-MetLife posts $1.4 bln quarterly net loss

By Lilla Zuill
Reuters
July 30, 2009


NEW YORK, July 30 (Reuters) - MetLife, the largest U.S. life insurer, on Thursday posted a quarterly net loss of $1.4 billion, as investment losses left its balance sheet in the red for the second consecutive quarter.

But the New York-based insurer's operating earnings, which excluded the investment losses, were better than expected, helped by stronger premium and fee income.

MetLife (MET)'s net loss was equal to $1.74 a share, compared with a profit of $915 million, $1.26 a share, a year ago.

The loss included after-tax realized losses of $2.6 billion -- $1.8 billion of which stemmed from losses on derivatives. Derivatives are a type of structured investment tied to the value of underlying assets.

MetLife said the write-downs were consistent with its expectations.

Life insurers such as MetLife and its next biggest rival, Prudential Financial (PRU), which reports its earnings next week, have been particularly susceptible to recent turmoil in the credit markets. The industry as a whole holds trillions of dollars of investments, and is one of America's biggest commercial real estate investors.

Excluding the losses, MetLife's operating earnings were $723 million, or 88 cents a share, compared with $887 million, or $1.22 a share, in the year-ago period.

Analysts on average expected MetLife to post operating earnings of 68 cents a share, according to Reuters Estimates.

Premiums, fees and other revenue rose 6 percent to $8.4 billion in the quarter, but net investment income fell 10 percent to $3.9 billion.

Shares closed up 4 percent at $33.57 on Thursday but were down about 1.4 percent in post-market trading.

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