By Suzanne Barlyn
(Reuters) - U.S. insurer MetLife Inc (N:MET) on Wednesday posted a 43% drop in quarterly adjusted earnings, spurred by declining premium income and private equity investment losses.
Adjusted earnings fell to $758 million in the second quarter from $1.3 billion a year earlier, MetLife said. Excluding items, MetLife earned 83 cents per share compared with $1.46 per share a year ago.
Analysts estimated earnings of 91 cents per share for the second quarter ending June 30, according to Factset, the company said.
Premiums and fees dropped 13% to $10.4 billion, from $12 billion a year ago.
Adjusted premiums and fees in MetLife's U.S. retirement income unit dropped 58%, to $511 million from $1.2 billion a year earlier, mainly because of lower activity in its business that takes over corporate pension assets.
MetLife's net investment income was $4.1 billion, down 13% from $4.7 billion a year ago. The decline was driven by a loss in variable investment income, reflecting a reporting lag from the first quarter for private equity results.
"The decline in our private equity portfolio was squarely within our expectations," MetLife Chief Executive Officer Michel Khalaf said in a statement.
MetLife's businesses include group workplace life insurance programs.
MetLife said it had higher COVID-related claims during the quarter, but did not provide specifics. The disease's effects in the third quarter would be largely offset by underwriting margins, the company said.
MetLife reported $710 million in net derivative losses, compared with $724 million in derivative gains a year ago.
Adjusted earnings at most of MetLife's businesses including the U.S., Asia and Latin America, dropped from the previous year because of declining variable investment income.
MetLife's EMEA unit reported an adjusted profit of $116 million, up 51% from $77 million a year ago, driven by favorable underwriting and expense margins, the company said.