Fitch Rates MetLife's Preferred Stock Issuance 'BBB'

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has assigned a 'BBB' rating to MetLife, Inc.'s (MetLife) issuance of $1.5 billion in series C fixed-to-floating rate non-cumulative perpetual preferred stock.

KEY RATING DRIVERS

Fitch expects proceeds from the issuance to be used to redeem approximately $1.5 billion of 6.50% series B non-cumulative perpetual preferred stock. Accordingly, Fitch does not expect today's issuance to have a significant effect on the credit profile of MetLife.

The rating assigned to the new preferred shares is equivalent to the ratings assigned to the preferred shares that will be redeemed with the proceeds, and reflects standard notching for a hybrid with its risk characteristics.

Fitch recently published an exposure draft of proposed changes to insurance notching criteria, which includes notching of hybrid securities. Per Fitch policies, newly assigned ratings are to be based on the proposed criteria. Fitch assesses the hybrid rated today as having 'Minimal' non-performance risk under the proposed criteria. Fitch notes the rating assigned to this hybrid would be the same under both proposed and existing criteria.

MetLife's ratings reflect Fitch's view that the company's strong balance sheet fundamentals, excellent financial flexibility, and very strong market positions in several major insurance products lines and markets in the U.S. and select international markets are consistent with rating expectations

RATING SENSITIVITIES

Key rating drivers that could lead to an upgrade of MetLife's ratings include NAIC risk-based capital ratio above 450%, financial leverage below 25%, and GAAP fixed charge coverage ratio above 9x.

Key rating drivers that could lead to a downgrade of MetLife's ratings include NAIC risk-based capital ratio below 350%, financial leverage above 30%, and GAAP fixed charge coverage ratio below 5x.

Fitch has assigned the following rating:

MetLife, Inc.

--5.250% fixed-to-floating rate non-cumulative perpetual preferred stock 'BBB'.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria

Exposure Draft: Insurance Notching Criteria (Proposed Methodology Changes) (pub. 12 May 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=865576

Insurance Rating Methodology (pub. 04 Sep 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=756650

Additional Disclosures

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=985474

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20150528006353/en/

Fitch Ratings
Primary Analyst
Bradley S. Ellis, CFA
Director
+1-312-368-2089
Fitch Ratings, Inc.
70 W. Madison Street
Chicago, IL 60602
or
Secondary Analyst
Douglas L. Meyer, CFA
Managing Director
+1-312-368-2061
or
Committee Chairperson
James B. Auden, CFA
Managing Director
+1-312-368-3148
or
Media Relations:
Alyssa Castelli, +1-212-908-0540
[email protected]
Elizabeth Fogerty, +1-212-908-0526
[email protected]

Source: Fitch Ratings

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