May 12, 2010

Research Update:
MetLife Inc. And Related Ratings
Remain On CreditWatch Negative
Primary Credit Analyst:
Shellie Stoddard, New York (1) 212-438-7244;shellie_stoddard@standardandpoors.com
Secondary Credit Analyst:
Kevin Ahern, New York (1) 212-438-7160;kevin_ahern@standardandpoors.com

Table Of Contents
Overview
Rating Action
Rationale
CreditWatch
Related Criteria And Research
Ratings List

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Research Update:
MetLife Inc. And Related Ratings Remain On
CreditWatch Negative
Overview
• Standard & Poor's has applied updated incremental stress factors within
its U.S. insurance capital adequacy model.
• We believe MetLife's capitalization remains deficient for the rating,
though it improved modestly as of year end 2009; the updated incremental
asset stress analysis had a neutral effect on our view of the group's
capital adequacy.
• Under MetLife's plan for financing its proposed acquisition of American
Life Insurance Co. (Alico) from AIG, Standard and Poor's expects the
capital deficiency to persist because dividends from the operating
companies will likely be required in 2011 to cover fixed charges.
• We are maintaining all global-scale ratings on MetLife and its
subsidiaries on CreditWatch with negative implications.

Rating Action
On May 12, 2010, Standard & Poor's Ratings Services said that its ratings on
MetLife Inc. (NYSE:MET) and most subsidiaries, including the 'A-' long-term
counterparty credit rating on MetLife, are remaining on CreditWatch, where
they were placed on Feb 3, 2010, with negative implications.

Rationale
We placed the ratings on CreditWatch following MetLife's agreement with
American International Group Inc. (AIG) to acquire AIG's international life
insurance subsidiary: American Life Insurance Co. (Alico). The transaction has
the potential to affect MetLife's capital and holding-company metrics. The
acquisition financing plan includes using $1.75 billion of holding-company
cash and servicing incremental debt and hybrids that will likely be dependent
on dividends from U.S. operating companies. Standard & Poor's believes access
to dividends from Alico will be limited for the first one to two years
following the acquisition. MetLife's unrestricted cash fixed-charge coverage
ratio (which we project at 2.4x in 2010) could decline to less than 2x if
MetLife is unable to access earnings and excess capital in Alico and its
subsidiaries through the early stages of integration.
Standard & Poor's updated incremental asset stress analysis had a neutral
impact on our view of MetLife's capital adequacy. MetLife's adjusted EBIT for
the three months ended March 31, 2010, was strong at $1.39 billion and within
our expectations. As of March 31, 2010, MetLife's debt leverage was 26%, while
financial leverage was 36% of total capital. We project GAAP fixed-charge
coverage of more than 5x in 2010, excluding the Alico transaction.
We acknowledge that the Alico transaction will improve debt leverage and

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 Research Update: MetLife Inc. And Related Ratings Remain On CreditWatch Negative

GAAP fixed-charge coverage. Our concerns relate to cash constraints that could
present themselves over the next one to two years following the transaction.
We also recognize the value of global diversification that the ALICO
organization will contribute to MetLife prospectively, with key market
positions in Japan and Eastern European countries that complement MetLife's
current international footprint. Alico will contribute a higher-margin,
lower-risk business profile to MetLife. However, Alico's size points to
significant execution risks, in our opinion.

CreditWatch
We likely will lower our ratings on MetLife by one notch after the acquisition
closes, given the decapitalization of consolidated companies. The announced
transaction would result in capitalization below our expectations for the
ratings. In addition, we likely will lower our ratings if, as announced, the
transaction causes the unrestricted cash fixed-charge coverage ratio to fall
below 2x. We consider it unlikely at this time that we would lower our ratings
by more than one notch.
However, if, following the close of the transaction, we expect
consolidated capitalization to return to levels consistent with the rating
within one year, and if MetLife has unrestricted sources of cash fixed-charge
coverage that exceed 2x interest and dividend payments on total debt and
hybrid securities, we likely would affirm the current ratings.
As we complete our review of this transaction, we will focus on MetLife's
ability to generate sufficient earnings and cash flows to rebuild capital
adequacy and comfortably service its fixed charges. Our discussions with
management will also review how MetLife will manage and mitigate the
operational and cultural integration of ALICO. We expect to resolve the
CreditWatch status of the ratings upon the completion of the transaction,
which likely will occur in the fourth quarter of 2010, and we intend to update
our analysis in the meantime.
Standard & Poor's will hold a teleconference on May 13, 2010, at 11:00
a.m. EDT to discuss both MetLife and the broader issues affecting North
American life insurers' investment portfolios. Callers in the U.K. should dial
(44) 20-7108-6248, and the dial-in number for participants everywhere else is
(1) 210-795-1098. The Conference ID is 7623938, and the passcode is LIFE.

Related Criteria And Research

• "Analysis Of Insurer Capital Adequacy," Dec. 18, 2009.
• "Methodology For Incorporating Incremental Stress Factors Into The
Capital Adequacy Analysis Of U.S. Insurers," April 12, 2010.
• "Use Of CreditWatch And Outlooks," Sept. 14, 2009.
• "Holding Company Analysis," June 11, 2009.

Ratings List
Ratings Remaining On CreditWatch

MetLife Inc.

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 Research Update: MetLife Inc. And Related Ratings Remain On CreditWatch Negative

Long-term Counterparty Credit Rating

Local Currency A-/Watch Neg

First MetLife Investors Insurance Co.

New England Life Insurance Co.
MetLife Investors USA Insurance Co.
MetLife Investors Insurance Co.
General American Life Insurance Co.
MetLife Insurance Co. of Connecticut
Counterparty Credit Rating
Local Currency AA-/Watch Neg/--

First MetLife Investors Insurance Co.

New England Life Insurance Co.
MetLife Investors USA Insurance Co.
MetLife Investors Insurance Co.
MetLife Insurance Co. of Connecticut
General American Life Insurance Co.
Financial Strength Rating
Local Currency AA-/Watch Neg/--

MetLife Assurance Ltd.

MetLife Insurance Ltd.
Counterparty Credit Rating
Local Currency A+/Watch Neg/--

MetLife Assurance Ltd.

MetLife Insurance Ltd.
MetLife Europe Ltd
Financial Strength Rating
Local Currency A+/Watch Neg/--

MetLife Taiwan Insurance Co. Ltd.

Counterparty Credit Rating
Local Currency twAA-/Watch Neg/--

Metlife Funding Inc.

Counterparty Credit Rating
Local Currency --/Watch Neg/A-1+

Metropolitan Life Insurance Co.

Counterparty Credit Rating
Local Currency AA-/Watch Neg/A-1+
Financial Strength Rating
Local Currency AA-/Watch Neg/A-1+

MetLife Inc.
Senior Unsecured A-/Watch Neg
Junior Subordinated BBB/Watch Neg
Preferred Stock BBB-/Watch Neg

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General American Life Insurance Co.

Metropolitan Life Insurance Co.
Subordinated A/Watch Neg

Met Life Institutional Funding I LLC

MetLife Reinsurance Company of Charleston
Senior Secured AA-/Watch Neg

MetLife Capital Trust IV

MetLife Capital Trust X
Preferred Stock BBB/Watch Neg

MetLife Short Term Funding LLC

Metlife Funding Inc.
Commercial Paper A-1+/Watch Neg

MetLife of Connecticut Global Funding I

Metropolitan Life Global Funding I
MetLife of Connecticut Institutional Funding Ltd.
Senior Secured AA-/Watch Neg

Complete ratings information is available to RatingsDirect on the Global

Credit Portal subscribers at www.globalcreditportal.com and RatingsDirect
subscribers at www.ratingsdirect.com. All ratings referenced herein can be
found on Standard & Poor's public Web site at www.standardandpoors.com. Use
the Ratings search box located in the left column.

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