MetLife Announces Second Quarter 2005 Results

-- Gains on Real Estate Sales Contribute to Record Net Income Per Common Share of $3.02

-- Reports Record Operating Earnings Per Common Share of $1.17, a 16% Increase

MetLife, Inc. (NYSE: MET) today reported second quarter 2005 netincome of $2.2 billion, or $3.02 per diluted common share, comparedwith $954 million, or $1.26 per diluted common share, for the secondquarter of 2004.
For the three
months ended
June 30,
---------------
2005 2004
------- -------
(Dollars in
millions,
except per
common share
data)

Net income1 $2,245 $954
Net income per diluted common share $3.02 $1.26
Operating earnings available to common shareholders2 $869 $766
Operating earnings per diluted common share2 $1.17 $1.01
Book value per diluted common share $35.16 $28.23
Book value per diluted common share, excluding
accumulated other comprehensive income per diluted
common share2 $31.02 $25.96

(1) $1.2 billion, net of income taxes, in gains on the sale ofreal estate are included in net income for the three months ended June30, 2005.

(2) Operating earnings, operating earnings available to commonshareholders, operating earnings per diluted common share and bookvalue per diluted common share (excluding accumulated othercomprehensive income per diluted common share) are not calculatedbased on generally accepted accounting principles ("GAAP").Information regarding non-GAAP financial measures and thereconciliation to GAAP measures in this press release are provided inthe Non-GAAP and Other Financial Disclosures section below, as well asin the tables that accompany this release.

Second Quarter Highlights

-- Achieved record quarterly net income of $2.2 billion, which includes $1.2 billion of net investment gains, net of income taxes, from the sale of real estate

-- Earned total premiums, fees and other revenues of $7.1 billion, a 13% increase over the prior year period

-- Continued strong investment spreads

"MetLife delivered outstanding results as we achieved record netincome and operating earnings available to common shareholders for thesecond consecutive quarter," said Robert H. Benmosche, chairman andchief executive officer of MetLife, Inc. "Our diverse institutionaland retail businesses in the U.S. and abroad continued to deliverstrong, top-line results. In addition to leveraging the benefits ofthe Travelers acquisition, we are well positioned to expand ourcustomer base by offering a variety of financial products, servicesand solutions that build financial freedom."

Operating earnings available to common shareholders for the secondquarter of 2005 were $869 million, or $1.17 per diluted common share,compared with $766 million, or $1.01 per diluted common share, for theprior year period.

Second Quarter Segment Overview

Reconciliations of segment net income to segment operatingearnings available to common shareholders are provided in the tablesthat accompany this release.

Institutional Business Earnings up 13%

Institutional Business operating earnings for the second quarterof 2005 were $358 million, compared with $317 million in the prioryear period. The improvement in earnings was primarily due toretirement & savings, which experienced strong interest spreads, andthe non-medical & health business, which had favorable underwritingresults. This was partially offset by a higher than normal level oflarge group life claims. Operating earnings in the prior year periodbenefited from a $31 million reduction, net of income taxes, to apreviously established premium tax liability in group life.

During the quarter, group life premiums, fees and other revenuesgrew 8% over the prior year period primarily due to growth from sales,strong retention and favorable renewal activity on large participatingbusiness. Retirement & savings net investment income grew 22% comparedto the prior year period largely due to higher corporate joint ventureincome and an increase in the asset base driven by favorable sales,particularly in guaranteed interest contracts and the structuredsettlement business. Non-medical health premiums, fees and otherrevenues increased 15% over the prior year period due to continuedgrowth across all product lines, particularly in the disability,long-term care and dental businesses.

Individual Business Earnings up 28%

Individual Business operating earnings were $278 million in thesecond quarter of 2005, compared with $217 million in the prior yearperiod. Results in Individual Business were driven primarily by growthin the annuity business and higher interest spreads. Traditional liferesults reflected the continuing decline in revenues from thecompany's closed block business while variable/universal life resultswere up over the prior year period primarily due to growth in thebusiness. Fees for the investment-type products within the annuitybusiness increased by 27% compared with the prior year period.Traditional life first year premiums and deposits were up 11%, drivenby higher term life sales. Declines in variable/universal lifepremiums and deposits were driven by lackluster interest in variablelife products and a decrease in high initial premium universal lifesales.

Auto & Home Earnings up 42%

Auto & Home operating earnings were $101 million in the secondquarter of 2005, compared with $71 million in the prior year period.Auto & Home's record results during the quarter benefited from animproved non-catastrophe combined ratio (86.4%), which resulted fromlower homeowners claim frequencies, moderate auto claim severity, andfavorable claim development related to prior accident years.Catastrophes for the second quarter of 2005 were also unusually low.

International Earnings up 22%

International operating earnings were $50 million in the secondquarter of 2005, compared with $41 million in the prior year period.Overall business growth in Latin America and Asia contributed to thesegment's growth during the quarter.

Investments

During the second quarter of 2005, the company completed the saleof One Madison Avenue and 200 Park Avenue in New York City. Combined,the sales resulted in a net investment gain of $1.2 billion, net ofincome taxes. During the quarter, derivative gains, net of incometaxes, of $249 million were primarily related to interest rate andforeign currency movements on positions which did not qualify forhedge accounting. In addition, variable income was at higher thannormal levels, primarily from corporate joint ventures.

Subsequent Event

On July 1, 2005, MetLife completed its acquisition of TravelersLife & Annuity and substantially all of Citigroup's internationalinsurance businesses for $11.8 billion. As part of the consideration,the company issued $1 billion in MetLife common stock, valued at$44.57 per common share, to Citigroup.

Earnings Conference Call

MetLife will hold its second quarter earnings conference call andaudio Webcast on Friday, July 29, 2005, from 8:00 to 9:00 a.m. (ET).The conference call will be available live via telephone and theInternet. To listen over the telephone, dial (612) 326-1003 (domesticand international callers). To listen to the conference call over theInternet, visit www.metlife.com (through a link on the InvestorRelations page).

Non-GAAP and Other Financial Disclosures

MetLife analyzes its performance using non-GAAP measures calledoperating earnings, operating earnings available to commonshareholders and operating earnings per diluted common share.Operating earnings is defined as GAAP net income excluding netinvestment gains and losses, net of income taxes, adjustments relatedto net investment gains and losses, net of income taxes, the impactfrom the cumulative effect of a change in accounting, net of incometaxes, and discontinued operations, net of income taxes. Scheduledsettlement payments on derivative instruments not qualifying for hedgeaccounting treatment are included in operating earnings. Operatingearnings available to common shareholders is defined as operatingearnings less preferred stock dividends. Operating earnings perdiluted common share is calculated by dividing operating earnings bythe number of weighted average diluted common shares outstanding forthe period indicated. MetLife believes these measures enhance theunderstanding and comparability of its performance by excluding netinvestment gains and losses, net of income taxes, and adjustmentsrelated to net investment gains and losses, net of income taxes, bothof which can fluctuate significantly from period to period, the impactof the cumulative effect of a change in accounting, net of incometaxes, and discontinued operations, net of income taxes, therebyhighlighting the results from operations and the underlyingprofitability drivers of the business. Operating earnings, operatingearnings available to common shareholders and operating earnings perdiluted common share should not be viewed as substitutes for GAAP netincome, GAAP net income available to common shareholders and GAAP netincome per diluted common share, respectively.
For the three months ended
June 30,
-----------------------------
2005 2004
-------------- --------------
(Dollars in millions, except
per common share data)

Net income available to common
shareholders $2,245 $3.02 $954 $1.26
Net investment (gains) losses, net of
income taxes1 (1,439) (1.94) (102) (0.13)
Adjustments related to net investment
(gains) losses, net of income taxes2 63 0.09 (72) (0.10)
Discontinued operations, net of income
taxes3 - - (14) (0.02)
-------------- --------------
Operating earnings available to common
shareholders $869 $1.17 $766 $1.01
============== ==============

Book value per diluted common share $35.16 $28.23
Accumulated other comprehensive income
per diluted common share 4.14 2.27
------- -------
Book value per diluted common share,
excluding accumulated other
comprehensive income per diluted common
share $31.02 $25.96
======= =======

(1) Net investment (gains) losses, net of income taxes, includes(gains) losses on sales of real estate and real estate joint venturesrelated to discontinued operations of $(1,219) million and $(85)million for the three months ended June 30, 2005 and 2004,respectively and excludes (gains) losses of $(8) million and $(14)million for the three months ended June 30, 2005 and 2004,respectively, from scheduled settlement payments on derivativeinstruments not qualifying for hedge accounting treatment.

(2) Adjustments related to net investment (gains) losses, net ofincome taxes, include amortization of deferred policy acquisitioncosts, adjustments to the policyholder dividend obligation and amountsallocable to certain participating contracts.

(3) Excludes (gains) losses on sales of real estate and realestate joint ventures related to discontinued operations.

For the six months ended June 30,
---------------------------------
2005 2004
----------------- ---------------
(Dollars in millions, except
per common share data)
Net income available to common
shareholders $3,232 $4.35 $1,552 $2.04
Net investment (gains) losses, net of
income taxes1 (1,418) (1.91) (178) (0.23)
Adjustments related to net investment
(gains) losses, net of income taxes2 27 0.04 (81) (0.11)
Cumulative effect of a change in
accounting, net of income taxes3 - - 86 0.11
Discontinued operations, net of income
taxes4 (151) (0.20) (18) (0.02)
-------------- --------------
Operating earnings available to common
shareholders $1,690 $2.28 $1,361 $1.79
============== ==============

(1) Net investment (gains) losses, net of income taxes, includes(gains) losses on sales of real estate and real estate joint venturesrelated to discontinued operations of $(1,231) million and $(98)million for the six months ended June 30, 2005 and 2004, respectivelyand excludes (gains) losses of $(24) million and $(23) million for thesix months ended June 30, 2005 and 2004, respectively, from scheduledsettlement payments on derivative instruments not qualifying for hedgeaccounting treatment.

(2) Adjustments related to net investment (gains) losses, net ofincome taxes, includes amortization of deferred policy acquisitioncosts, adjustments to the policyholder dividend obligation and amountsallocable to certain participating contracts.

(3) The cumulative effect of a change in accounting, net of incometaxes, for the six months ended June 30, 2004, is in accordance withAICPA Statement of Position 03-1, Accounting and Reporting byInsurance Enterprises for Certain Non-Traditional Long-DurationContracts and for Separate Accounts.

(4) Excludes (gains) losses on sales of real estate and realestate joint ventures related to discontinued operations.

This release contains statements which constitute forward-lookingstatements within the meaning of the Private Securities LitigationReform Act of 1995, including statements relating to trends in thecompany's operations and financial results and the business and theproducts of the company and its subsidiaries, as well as otherstatements including words such as "anticipate," "believe," "plan,""estimate," "expect," "intend" and other similar expressions.Forward-looking statements are made based upon management's currentexpectations and beliefs concerning future developments and theirpotential effects on the company. Such forward-looking statements arenot guarantees of future performance.

Actual results may differ materially from those included in theforward-looking statements as a result of risks and uncertaintiesincluding, but not limited to the following: (i) changes in generaleconomic conditions, including the performance of financial marketsand interest rates; (ii) heightened competition, including withrespect to pricing, entry of new competitors and the development ofnew products by new and existing competitors; (iii) unanticipatedchanges in industry trends; (iv) the company's primary reliance, as aholding company, on dividends from its subsidiaries to meet debtpayment obligations and the applicable regulatory restrictions on theability of the subsidiaries to pay such dividends; (v) deteriorationin the experience of the "closed block" established in connection withthe reorganization of Metropolitan Life Insurance Company; (vi)catastrophe losses; (vii) adverse results or other consequences fromlitigation, arbitration or regulatory investigations; (viii)regulatory, accounting or tax changes that may affect the cost of, ordemand for, the company's products or services; (ix) downgrades in thecompany's and its affiliates' claims paying ability, financialstrength or credit ratings; (x) changes in rating agency policies orpractices; (xi) discrepancies between actual claims experience andassumptions used in setting prices for the company's products andestablishing the liabilities for the company's obligations for futurepolicy benefits and claims; (xii) discrepancies between actualexperience and assumptions used in establishing liabilities related toother contingencies or obligations; (xiii) the effects of businessdisruption or economic contraction due to terrorism or otherhostilities; (xiv) the company's ability to identify and consummate onsuccessful terms any future acquisitions, and to successfullyintegrate acquired businesses with minimal disruption; and (xv) otherrisks and uncertainties described from time to time in the company'sfilings with the Securities and Exchange Commission, including its S-1and S-3 registration statements. The company specifically disclaimsany obligation to update or revise any forward-looking statement,whether as a result of new information, future developments orotherwise.

MetLife, Inc. is a leading provider of insurance and otherfinancial services to millions of individual and institutionalcustomers throughout the United States. Through its subsidiaries andaffiliates, MetLife, Inc. offers life insurance, annuities, automobileand homeowner's insurance and retail banking services to individuals,as well as group insurance, reinsurance and retirement and savingsproducts and services to corporations and other institutions. Outsidethe U.S., the MetLife companies have direct insurance operations inAsia Pacific, Latin America and Europe. For more information, pleasevisit www.metlife.com.

For a copy of MetLife's Quarterly Financial Supplement, pleasevisit www.metlife.com.

MetLife, Inc.
Consolidated Statements of Income
Unaudited
(Dollar amounts in millions)

Three months Six months ended
ended June 30, June 30,
--------------- -----------------
2005 2004 2005 2004
------- ------- -------- --------

Premiums $6,019 $5,337 $12,021 $10,723
Universal life and investment-type
product policy fees 814 721 1,605 1,384
Net investment income 3,482 3,082 6,699 6,020
Other revenues 301 284 600 597
Net investment gains (losses) 333 47 318 163
------- ------- -------- --------
Total revenues 10,949 9,471 21,243 18,887
------- ------- -------- --------

Policyholder benefits and claims 6,238 5,377 12,200 10,852
Interest credited to policyholder
account balances 820 743 1,615 1,481
Policyholder dividends 420 420 835 845
Other expenses 2,008 1,866 3,981 3,717
------- ------- -------- --------
Total expenses 9,486 8,406 18,631 16,895
------- ------- -------- --------

Income from continuing operations
before provision for income taxes 1,463 1,065 2,612 1,992
Provision for income taxes 454 237 804 527
------- ------- -------- --------
Income from continuing operations 1,009 828 1,808 1,465
Income from discontinued operations,
net of income taxes 1,236 126 1,424 173
------- ------- -------- --------
Income before cumulative effect of a
change in accounting, net of income
taxes 2,245 954 3,232 1,638
Cumulative effect of a change in
accounting, net of income taxes (4) - - - (86)
------- ------- -------- --------
Net income 2,245 954 3,232 1,552
Preferred stock dividend - - - -
------- ------- -------- --------
Net income available to common
shareholders $2,245 $954 $3,232 $1,552
======= ======= ======== ========


Operating Earnings Reconciliation
---------------------------------
Net income available to common
shareholders $2,245 $954 $3,232 $1,552
Net investment gains (losses) 2,225 157 2,204 280
Minority interest - net investment
gains (losses) (2) (8) (11) (16)
Net investment gains (losses) tax
benefit (provision) (784) (47) (775) (86)
------- ------- -------- --------
Net investment gains (losses), net of
income taxes (1) (2) 1,439 102 1,418 178
Adjustments related to policyholder
benefits and dividends (86) 116 (16) 147
Adjustments related to other expenses (9) (5) (24) (22)
Adjustments related to tax benefit
(provision) 32 (39) 13 (44)
------- ------- -------- --------
Adjustments related to net investment
gains (losses), net of income
taxes (3) (63) 72 (27) 81
Cumulative effect of a change in
accounting, net of income taxes (4) - - - (86)
Discontinued operations, net of
income taxes (5) - 14 151 18
------- ------- -------- --------
Operating earnings 869 766 1,690 1,361
Preferred stock dividend - - - -
------- ------- -------- --------
Operating earnings available to
common shareholders $869 $766 $1,690 $1,361
======= ======= ======== ========


(1) Net investment gains (losses), net of income taxes, includes gains
(losses) on sales of real estate and real estate joint ventures
related to discontinued operations, of $1,219 million and $1,231
million, respectively, for the three months and six months ended
June 30, 2005 and $85 million and $98 million, respectively, for
the three months and six months ended June 30, 2004.

(2) Net investment gains (losses), net of income taxes, excludes gains
(losses) of $8 million and $24 million, respectively, for the
three months and six months ended June 30, 2005 and $14 million
and $23 million, respectively, for the three months and six months
ended June 30, 2004 from scheduled settlement payments on
derivative instruments not qualifying for hedge accounting
treatment.

(3) Adjustments related to net investment gains (losses), net of
income taxes, includes amortization of deferred policy acquisition
costs, adjustments to the policyholder dividend obligation and
amounts allocable to certain participating contracts.

(4) The cumulative effect of a change in accounting, net of income
taxes, for the six months ended June 30, 2004, is in accordance
with AICPA Statement of Position 03-1, Accounting and Reporting by
Insurance Enterprises for Certain Nontraditional Long-Duration
Contracts and for Separate Accounts.

(5) Excludes gains (losses) on sales of real estate and real estate
joint ventures related to discontinued operations.

MetLife, Inc.
Financial Highlights
Unaudited
(Dollar amounts in millions, except per common
share data or unless otherwise noted)

At or for the At or for the
three months six months
ended June 30, ended June 30,
--------------- ---------------
2005 2004 2005 2004
------- ------- ------- -------
Other Financial Data:
Net income available to common
shareholders $2,245 $954 $3,232 $1,552
Operating earnings available to
common shareholders $869 $766 $1,690 $1,361
Total assets under management
(billions) $381.4 $338.0 $381.4 $338.0

Individual Business Sales Data:
Total first year life premiums and
deposits $213 $273 $420 $476
Variable and Universal life first
year premiums and deposits
(including COLI/BOLI) $161 $226 $321 $384
Total annuity deposits $2,496 $2,882 $5,036 $6,318
Mutual fund sales $916 $864 $1,870 $1,909

Earnings Per Share Calculation:
Weighted average common shares
outstanding - diluted 743.1 758.0 742.3 759.4
Operating earnings available to
common shareholders per common
share - diluted $1.17 $1.01 $2.28 $1.79
Net income available to common
shareholders per common share -
diluted $3.02 $1.26 $4.35 $2.04

MetLife, Inc.
Balance Sheet Data
June 30, 2005 (Unaudited) and December 31, 2004 (Audited)
(Dollar amounts in millions)


At At
June 30, December 31,
2005 2004
--------- ------------
Balance Sheet Data:
General account assets $291,972 $270,039
Separate account assets 89,459 86,769
--------- ------------
Total assets $381,431 $356,808
========= ============

Policyholder liabilities (including amounts of
closed block) $200,782 $194,128
Short-term debt 1,979 1,445
Long-term debt 9,304 7,412
Junior subordinated debt securities underlying
common equity units 2,134 -
Shares subject to mandatory redemption 278 278
Other liabilities 49,324 43,952
Separate account liabilities 89,459 86,769
--------- ------------
Total liabilities 353,260 333,984
--------- ------------

Preferred stock, at par value 1 -
Common stock, at par value 8 8
Additional paid-in capital 16,974 15,037
Retained earnings 9,840 6,608
Treasury stock (1,733) (1,785)
Accumulated other comprehensive income 3,081 2,956
--------- ------------
Total stockholders' equity 28,171 22,824
--------- ------------
Total liabilities and stockholders' equity $381,431 $356,808
========= ============

MetLife, Inc.
Reconciliations of Net Income Available to Common Shareholders
to Operating Earnings Available to Common Shareholders
Unaudited
(Dollar amounts in millions)


Three months Six months
ended ended
June 30, June 30,
----------- -----------
2005 2004 2005 2004
----- ----- ----- -----

Total Institutional Operations
Net income available to common shareholders $607 $377 $956 $687
Net investment gains (losses), net of income
taxes 273 9 275 73
Adjustments related to net investment gains
(losses), net of income taxes (24) 51 (1) 40
Cumulative effect of a change in accounting,
net of income taxes - - - (60)
----- ----- ----- -----
Operating earnings available to common
shareholders $358 $317 $682 $634
===== ===== ===== =====

Institutional Operations
Group Life
Net income available to common shareholders $80 $126 $170 $220
Net investment gains (losses), net of income
taxes - (4) (10) 13
----- ----- ----- -----
Operating earnings available to common
shareholders $80 $130 $180 $207
===== ===== ===== =====

Retirement & Savings
Net income available to common shareholders $431 $183 $616 $353
Net investment gains (losses), net of income
taxes 237 28 250 60
Adjustments related to net investment gains
(losses), net of income taxes (10) 20 1 20
Cumulative effect of a change in accounting,
net of income taxes - - - (40)
----- ----- ----- -----
Operating earnings available to common
shareholders $204 $135 $365 $313
===== ===== ===== =====

Non-Medical Health & Other
Net income available to common shareholders $96 $68 $170 $114
Net investment gains (losses), net of income
taxes 36 (15) 35 -
Adjustments related to net investment gains
(losses), net of income taxes (14) 31 (2) 20
Cumulative effect of a change in accounting,
net of income taxes - - - (20)
----- ----- ----- -----
Operating earnings available to common
shareholders $74 $52 $137 $114
===== ===== ===== =====

Total Individual Operations
Net income available to common shareholders $564 $246 $929 $435
Net investment gains (losses), net of income
taxes 321 32 353 13
Adjustments related to net investment gains
(losses), net of income taxes (35) (3) (20) 18
----- ----- ----- -----
Operating earnings available to common
shareholders $278 $217 $596 $404
===== ===== ===== =====

Individual Operations
Traditional Life
Net income available to common shareholders $268 $93 $437 $164
Net investment gains (losses), net of income
taxes 223 20 268 5
Adjustments related to net investment gains
(losses), net of income taxes (22) (4) (7) 18
----- ----- ----- -----
Operating earnings available to common
shareholders $67 $77 $176 $141
===== ===== ===== =====

Variable & Universal Life
Net income available to common shareholders $46 $29 $87 $44
Net investment gains (losses), net of income
taxes 9 (5) 1 (2)
Adjustments related to net investment gains
(losses), net of income taxes (2) 2 (4) 1
Cumulative effect of a change in accounting,
net of income taxes - - - (11)
----- ----- ----- -----
Operating earnings available to common
shareholders $39 $32 $90 $56
===== ===== ===== =====

Annuities
Net income available to common shareholders $258 $117 $408 $215
Net investment gains (losses), net of income
taxes 94 17 95 19
Adjustments related to net investment gains
(losses), net of income taxes (11) (1) (9) (1)
Cumulative effect of a change in accounting,
net of income taxes - - - 11
----- ----- ----- -----
Operating earnings available to common
shareholders $175 $101 $322 $186
===== ===== ===== =====

Other
Net income (loss) available to common
shareholders $(8) $7 $(3) $12
Net investment gains (losses), net of income
taxes (5) - (11) (9)
----- ----- ----- -----
Operating earnings (loss) available to common
shareholders $(3) $7 $8 $21
===== ===== ===== =====

Total Auto & Home
Net income available to common shareholders $98 $68 $174 $114
Net investment gains (losses), net of income
taxes (3) (3) (3) (3)
----- ----- ----- -----
Operating earnings available to common
shareholders $101 $71 $177 $117
===== ===== ===== =====

Auto & Home
Auto
Net income available to common shareholders $65 $58 $108 $80
Net investment gains (losses), net of income
taxes (2) (3) (2) (3)
----- ----- ----- -----
Operating earnings available to common
shareholders $67 $61 $110 $83
===== ===== ===== =====

Homeowners
Net income available to common shareholders $32 $12 $63 $34
Net investment gains (losses), net of income
taxes (1) - (1) -
----- ----- ----- -----
Operating earnings available to common
shareholders $33 $12 $64 $34
===== ===== ===== =====

Other
Net income (loss) available to common
shareholders $1 $(2) $3 $-
Net investment gains (losses), net of income
taxes - - - -
----- ----- ----- -----
Operating earnings (loss) available to common
shareholders $1 $(2) $3 $-
===== ===== ===== =====

International
Net income available to common shareholders $45 $70 $121 $106
Net investment gains (losses), net of income
taxes 5 (3) 5 17
Adjustments related to net investment gains
(losses), net of income taxes (10) 32 (1) 34
Cumulative effect of a change in accounting,
net of income taxes - - - (30)
----- ----- ----- -----
Operating earnings available to common
shareholders $50 $41 $117 $85
===== ===== ===== =====

Reinsurance
Net income available to common shareholders $6 $30 $37 $59
Net investment gains (losses), net of income
taxes (3) 15 12 24
Adjustments related to net investment gains
(losses), net of income taxes 6 (8) (5) (11)
Cumulative effect of a change in accounting,
net of income taxes - - - 5
----- ----- ----- -----
Operating earnings available to common
shareholders $3 $23 $30 $41
===== ===== ===== =====