MetLife Cuts Profit on Accounting Error

August 14, 2003, 1:00 a.m. EDT 1 Min Read

MetLife said Monday it is reducing its recently reported second-quarter earnings by $31 million after taxes because its New England Financial affiliate improperly deferred expenses. MetLife also replaced Thom Faria as the affiliates president.

The change restated the companys net income to $580 million, from the $611 million reported Aug. 4. Both figures are up from MetLifes year-earlier profit of $387 million.

"We are disappointed by the need for this adjustment and by the timing of it, one week after the release of our second-quarter results," Robert H. Benmosche, the insurers chairman and chief executive officer said in a statement. "Excluding this charge, we continue to work toward and expect to achieve our 2003 business plan."

Eileen McDonnell, senior vice president of individual insurance business development at MetLife, will succeed Faria as president of New England Financial. Faria has since left the company. In her previous post, McDonnell had overall responsibility for field recruiting and training, advanced markets, strategic planning, expense management and field compensation for the MetLife, GenAmerica Financial and New England Financial distribution channels.

Before joining MetLife this year, cDonnell was a senior vice president and head of individual insurance at Guardian Life Insurance Co., where she oversaw retail distribution, product development, marketing and operations. Earlier, McDonnell worked for nearly 10 years at Axa Financial.