Wed, Apr. 29, 12:14 PM
- The major averages are lower by 0.5% or more, but margin-starved financials are in the green as rates head higher both here and overseas.
- Previously: Major selloff in fixed income (April 29)
- The 10-year U.S. Treasury yield is up six basis points to 2.06% - nearing its highest level of the year - and European yields are shooting up even faster ... All this despite the absence of any GDP growth in the U.S. in Q1.
- Considered perhaps the most "asset-sensitive" of the TBTF banks, Bank of America (BAC +1.9%) is leading that group higher.
- Among regional names: Regions Financial (RF +1.1%), Fifth Third (FITB +1.3%) SunTrust (STI +0.9%), BB&T (BBT +0.8%).
- Insurers: MetLife (MET +2.4%), Prudential (PRU +1.5%), Lincoln National (LNC +1.8%).
Tue, Apr. 28, 10:37 AM
Mon, Apr. 20, 3:13 PM
- The Bank of England months ago penned a letter to the U.S. Treasury asking why The Oracle's reinsurance operation has been left off of Financial Stability Board's provisional list of too big too fail institutions.
- MetLife (NYSE:MET) - which has sued the U.S. government over its curious designation as a SIFI - would also probably like to know, as would a number of other primary insurers that have been so tagged.
- Berkshire (BRK.A, BRK.B) is part of a group of reinsurers - Swiss Re (OTCPK:SSREY) and Munich Re also come to mind - which have thus far escaped such scrutiny, even though primary insurers might argue the reinsurers are more important to the global financial system. The Basel-based FSB was supposed to make a reinsurance list public last year, but postponed the effort in November "pending further development of the methodology."
- Insurance is Berkshire's most significant business - accounting for 27% of net earnings last year - and providing Warren Buffett with the capital to invest in stocks and acquisitions.
- Source: FT
Tue, Apr. 14, 8:51 AM| Tue, Apr. 14, 8:51 AM | Comment!
Thu, Mar. 26, 6:38 PM
- MetLife (NYSE:MET) is granted a six-month extension by the Fed and the FDIC to file its first plan showing how it could collapse without causing broader economic damage; it will now have to submit its first resolution plan by Dec. 31, 2016.
- The regulators voted at the request of the judge presiding over MET's lawsuit challenging its designation as a "systemically important financial institution" last fall.
- "Living will" plans, designed by companies with oversight from regulators, lay out a path that would allow the companies to declare bankruptcy if necessary without taxpayer assistance.
Tue, Mar. 24, 8:05 AM
- At least so far, this year is looking a lot like the last few years to those waiting for higher interest rates to boost spread income. Writing in the company annual report, MetLife (NYSE:MET) CEO Steven Kandarian says the insurer continues to expect a 10-year Treasury yield of 4-4.5% by year-end 2017, but the risk remains of a miss to the underside.
- If rates do stay low, says Kandarian, maintaining last year's 12% ROE over the long term would prove difficult. Investors, says Kandarian, should judge financial companies not on absolute ROE, but on the spread between ROE and 10-year yields.
- It makes sense, writes John Carney, but sounds like a warning signal on returns going forward, not just for MetLife, but its insurance peers and the banks.
- ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, KIE, SEF, IYG, IAK, FXO, FNCL, FINU, RWW, RYF, KBWP, KBWI, FINZ
Tue, Mar. 17, 12:09 PM
- Scouring the globe for something with a decent yield, MetLife (MET -1.1%) loans a total of $146M to Kennedy Wilson (KW -0.6%) to finance four properties in Ireland.
- The four include three Class A multi-family assets and a multi-tenant office property. All are located in the Dublin area.
- MetLife Real Estate Investors originated more than $2.1B in commercial mortgage loans in the U.K. last year, and MetLife has a commercial mortgage portfolio of about $3.5B in the U.K. and Ireland.
- Source: Press release
Wed, Mar. 11, 3:20 PM
- "“In the case of Brazil, we think that we need to gain more scale,” says Roberto Walker, president of Latin America for Principal Financial Group (PFG +0.9%). "We are always very actively looking for strategic acquisitions, particularly in the case of asset management and mutual funds," he says, adding Mexico as also being a target.
- PFG and MetLife (MET +0.7%) have recently expanded in Chile, and both held events today in Santiago focusing on opportunities to provide their products to the fast-growing middle-class and affluent savers of Latin America - particularly as governments push citizens for privately-managed retirement plans.
- “We’ve grown by acquisitions, and we’ll continue to do that,” says Bill Wheeler, head of the Americas at MetLife. “But we’ve also grown organically.”
Fri, Mar. 6, 9:46 AM
- A turnaround from the action earlier this year - financials (XLF +0.9%) are marching higher in early action as the averages slip, as nervous investors buy back in following the stress test results. Also helping are surging interest rates following the strong jobs number.
- Looking at a pretty broad screen of bank names, just two - Goldman Sachs and Zions, both of which barely passed the stress test - are lower. Among the others: Bank of America (BAC +3.7%), JPMorgan (JPM +1.1%), U.S. Bancorp (USB +1.6%), Regions FInancial (RF +2.3%), KeyCorp (KEY +2.7%), PNC Financial (PNC +2.3%), BB&T (BBT +2.4%), Fifth Third (FITB +2.2%), Comerica (CMA +3.8%), BNY Mellon (BK +2.9%).
- Among those starved for higher rates: MetLife (MET +3%), Prudential (PRU +3.3%), Lincoln National (LNC +4.1%), AIG (AIG +1.4%), Hartford (HIG +2%), E*Trade (ETFC +3.9%), Schwab (SCHW +4.4%), Ameritrade (AMTD +4.3%).
- Previously: Futures slip after jobs number as yields and dollar soar (March 6)
- ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, KIE, IAT, IAI, SEF, IYG, IAK, FXO, FNCL, KBWB, QABA, FINU, KCE, KRU, RWW, KBWR, RYF, KBWP, KBWI, PSCF, KBWC, FINZ, KRS
Tue, Mar. 3, 3:57 PM
- MetLife (MET +0.1%) in January sued the Financial Stability Oversight Council over its designation of the insurer as a systemically important. The two parties have now asked a court to agree to give the FSOC until May 7, rather than March 16, to respond.
- The case is an important one as it could shed some light on exactly what the secretive council was looking at when it decided to hand out the non-bank SIFI label to not just MetLife, but also AIG and Prudential (who are not involved in any suit against the Council).
Wed, Feb. 25, 2:35 PM
- At issue were mortgages issued which MetLife (MET -0.3%) allegedly knew did not meet GSE standards, but which the insurer allowed to be insured by Frannie anyway. MetLife had previously reserved for the fine and, of course, exited the mortgage business a few years back.
- In other news, the company boosts the size of its board to 13 with the addition of Ned Kelly who has been in the financial services business for four decades, most recently as chairman of the institutional clients group at Citigroup.
Wed, Feb. 11, 4:27 PM
- Q4 operating earnings of $1.6B up 2% Y/Y; EPS of $1.38 up 1%. Operating ROE of 11.3%. Book value excluding AOCI of $49.53 up 5% Y/Y.
- Company-wide premiums, fees, and other revenues of $13.134B up marginally from a year ago.
- The Americas operating earnings of $1.5B up 4%, up 6% constant currency from a year ago.
- Asia operating earnings of $335M up 3%, up 9% constant currency from a year ago. Premiums, fees, and other revenues down 3%, up 6% constant currency.
- EMEA operating earnings of $85M, down 4%, up 9% constant currency.
- Net investment income of $5.1B down 3%.
- Conference call tomorrow at 8 ET
- Previously: MetLife beats by $0.02, beats on revenue (Feb. 11)
- MET +0.2% after hours
Wed, Feb. 11, 4:16 PM
Tue, Feb. 10, 5:35 PM
- ABCO, ACHC, AEM, AMAT, AMBR, AUY, BIDU, CAKE, CJES, CPA, CRAY, CSCO, CSOD, CTL, CVA, CXW, CYS, DDR, DIOD, EFC, EFX, EXL, FET, FEYE, FORR, GAS, HIVE, HNI, HOS, IO, ITRI, LPSN, MET, NSIT, NTAP, NTWK, NU, NVDA, OII, PNRA, PPC, QDEL, REG, SCSS, SKX, SLF, SPRT, STMP, SWM, TAL, TCX, TRIP, TSLA, TSO, TTGT, WFM, ZEN, ZU
Fri, Feb. 6, 9:50 AM
- Financials have been mercilessly pounded in 2015 as hopes for higher interest rates looked like they might be dashed yet again, but today's blowout jobs number - firmly putting a June rate hike on the table - has brought in the dip-buyers.
- The major averages are flat, but the XLF is up 1.4%. The Regional Bank ETF (KRE +2%) and the Bank ETF (KBE +2.1%) are doing even better.
- Among the yield-starved banking names: Bank of America (BAC +3.1%), JPMorgan (JPM +2.6%), Citigroup (C +2%), Regions Financial (RF +4%), KeyCorp (KEY +3%), PNC Financial (PNC +2.9%), SunTrust (STI +2.3%), Zions (ZION +3.6%), Synovus (SNV +2.3%).
- Insurers: MetLife (MET +2%), Prudential (PRU +3.2%), Lincoln National (LNC +4.6%). AIG (AIG +1.5%).
- Trust banks: BNY Mellon (BK +2.7%) State Street (STT +1.9%), Northern Trust (NTRS +2.3%).
- Online brokers (currently getting killed on money-market fee rebates): Schwab (SCHW +4.5%), TD Ameritrade (AMTD +3.5%), E*Trade (ETFC +2.1%).
- ETFs: XLF, FAS, FAZ, UYG, KRE, VFH, KBE, IYF, KIE, IAT, IAI, SEF, IYG, IAK, FXO, FNCL, KBWB, QABA, FINU, KRU, RWW, KBWR, RYF, KBWP, KBWI, PSCF, FINZ, KRS
Sat, Jan. 24, 4:48 PM
- The financial sector is off to a worse start to the year than even the energy names, with the XLF down 3.9% YTD vs. the XLE's 3.2% decline. The S&P 500 is roughly flat. The SPDR KBW Bank ETF (NYSEARCA:KBE) is off 7.5%, and the Regional Bank ETF (NYSEARCA:KRE) is lower by 6.9%.
- Q4 earnings results haven't been wonderful, but financial names had been savaged well before those reports started coming out. Instead there's a difficult regulatory regime that won't quit, and - for now - it's looking like "wait'll next year" for the rising interest rates that were supposed to drive profit margins higher. The 10-year/2-year spread - already pretty low at 150 basis points to start the year - has narrowed to 137 bps.
- A partial roll call of banks: Bank of America (NYSE:BAC) -12.1% YTD, Citigroup (NYSE:C) -10.1%, JPMorgan (NYSE:JPM) -9.4%, Morgan Stanley (NYSE:MS) -9.4%, Regions Financial (NYSE:RF) -14.7%, KeyCorp (NYSE:KEY) -4.5%, PNC Financial (NYSE:PNC) -5.4%, Bank of New York (NYSE:BK) -9.1%, Capital One (NYSE:COF) -6%, Discover (NYSE:DFS) -13.6%.
- Other spread-starved sector names: MetLife (NYSE:MET) -9.8%, AIG (NYSE:AIG) -8%, Prudential (NYSE:PRU) -10.8%, Schwab (NYSE:SCHW) -9.9%.
- Some of what's working in financials: Blackstone (NYSE:BX) +6.7%, E*Trade (NASDAQ:ETFC) +1.2%, WisdomTree (NASDAQ:WETF) +12.3%, Legg Mason +2.8%.
MetLife Inc is a provider of insurance, annuities & employee benefit programs in United States, Japan, Latin America, Asia, Europe & Middle East. It offers life insurance, annuities, property & casualty insurance, and other financial services.
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