The largest life insurer in the U.S., MetLife Inc. (NYSE: MET) reported on Wednesday that its fiscal second-quarter profits leaped twofold, thanks mainly to rising gains on derivatives in the backdrop of falling interest rates. The company’s operating results also surpassed Street’s estimations owing to double digit growth in Americas.
Even though MetLife, just like any of its peers, is consistently exposed to low interest rate regime, increasing usage of derivative programs has significantly lowered that risk.
Since the rates fell further in the fiscal second quarter, the Company was able to book profits of $1.4bn on its derivatives position and other items.
For the quarter, MetLife reported a profit of $2.26 billion, or $2.12 per share, against a net profit of $1.07 billion or $1 per share, in the corresponding period of last year.
On an operating basis, Company’s earnings stood at $1.33 per share. Analysts polled by Thomson Reuters projected EPS of $1.24 per share.
The company reported that operating earnings at its Americas segment rose 11 percent, on account of growing retail life insurance, annuity sales in addition to its group and voluntary benefits unit.
MetLife shares rose marginally in after-hours trading as investors digested the company’s quarterly results. At last check, the stock was trading 0.23% higher at $30.50.
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