MetLife Seeks to Slip Yellen Squeeze as AIG Embraces Fed
By Ian Katz and Zachary Tracer
Steven Kandarian got MetLife Inc. out of banking to escape Federal Reserve oversight. Now, the insurer is fighting again to avoid the central bank’s reach. Kandarian, MetLife’s chief executive officer, has called regulatory uncertainty the primary challenge to meeting profit targets as he shuns stock buybacks amid concerns that the insurer will face tighter capital rules. Rival AIG embraced U.S. oversight. And Prudential Financial Inc., after resisting supervision, said “moving on is the right thing for us to do.” The CEO’s objection is that MetLife could be labeled systemically important and a potential risk to the economy by the Financial Stability Oversight Council, or FSOC, a panel of U.S. regulators empowered to subject companies to stricter Fed supervision. Kandarian’s campaign features closed-door sessions with regulators and lawmakers, the submission of thousands of pages of supporting documents and help from consultants Oliver Wyman and Promontory Financial Group LLC. “We truly believe we’re not systemically important,” Kandarian, 62, said in an interview. Asked whether he would file a court appeal if the council brands New York-based MetLife systemically important, an option considered and then rejected by Prudential, he said that “nothing is off the table.” “The insurance industry has done an excellent job of making the whole systemic framework for insurance companies a political issue,” said Karen Shaw Petrou, managing partner of Washington-based research firm Federal Financial Analytics Inc.