MetLife (NYSE:MET) fell in morning trading after the largest U.S. life insurer said third-quarter profit tumbled 43% due to deteriorated investment results and higher tax costs.
Shares declined 2.2% to $49.39 at 10:37 a.m. in New York, expanding this year's slump to 8.9%.
Net income dropped to $1.2bn, or $0.62 per diluted share, in the September quarter, from $2.09bn, or $1.60 per diluted share, a year earlier, the New York-based company said in a statement late on Wednesday.
Operating profit, which excludes some one-time items, was $0.62 per share, lagging behind the $0.76 estimate from 18 analysts surveyed by Capital IQ..
Net investment income declined 6.6% from a year earlier to $4.85bn.
The contribution from variable holdings, which include hedge funds bets, sank 37% to $267 mln.
Insurers’ investment returns have been weakened for years by low yields, which limit income on the fixed-income securities that account for most of the industry’s holdings.
Meanwhile, Prudential Financial (NYSE:PRU),the second largest U.S. life insurer by assets, on Wednesday said it posted a 7.4% increase in its closely watched operating earnings. That was below Wall Street analysts’ expectations, as its business was also pressured by interest rates.