MetLife CEO cautions about new entrants' risks: Bloomberg

• MetLife (MET +3.5%) CEO Steven Kandarian, who's retiring at the end of the month, warns regulators to keep an eye on new players in the life insurance industry, especially where they're investing their money, Bloomberg reports.
• "Regulators should look hard at this and make sure risks being taken on by these new entrants are appropriate because, again, we pick up the tab if they fail," Kandarian said.
• New entrants include private equity and bank-connected annuity sellers. For example, Goldman Sachs (GS +2.4%) helped form Global Atlantic Financial and Athene Holding (ATH +2.6%) has ties to Apollo Global Management (APO +1.1%).
• Kandarian also said MetLife is wary about risks from the leveraged-loan market and BBB-rated debt.
• “We have actually reduced exposure in both those segments and we’re very careful in terms of what kind of credit we’re putting on our books right now," he said.
• Previously: MetLife fills in leadership positions ahead of CEO transition (March 7)

Comments

[Jamjack]

Wise advice from the company who has been around for a long while! Long Snoopy. (:

[Alfred Galli]

There is little chance that government regulators will actually do anything at least until one of the new entrants fails.

[Bigpic62]

"Regulators should look hard at this and make sure risks being taken on by these new entrants are appropriate because, again, we pick up the tab if they fail," Kandarian said.

Gosh golly, I thought we were in a "free market economy" where if you lose, YOU bear the costs. LOL!

[RoHughes59]

You obviously don't understand the concept of Insurance Guarantee Funds.

[Well meaning]

@Bigpic62 I think your statement "You bear the costs." should be modified to read SHOULD bear the costs.

Unfortunately, in reality WE ALL bear the costs through Insurance Guarantees and other government bailouts. Of course the politicians love this because it gives them enormous power to decide who gets those bailouts and the steady flow of political contributions they receive because of it. Fortunately those politicians are far to ethical to let those contributions affect their actions, right? Haha!