MetLife plans to separate much of its U.S. retail business as Chief Executive Officer Steve Kandarian works to shrink the company to limit federal oversight.
The insurer is weighing a possible sale, spinoff or public offering of the operation, New York-based MetLife said Tuesday in a statement. The new company would have about $240 billion of assets and accounts for approximately 20 percent of MetLife's operating earnings, according to the statement.
MetLife joins General Electric Co.'s finance unit in seeking to simplify operations after being designated by a U.S. panel as a non-bank systemically important financial institution, a tag that can lead to stricter limits on the balance sheet. Kandarian has sought to reverse that designation in court.
The unit faces "higher capital requirements that could put it at a significant competitive disadvantage," Kandarian said in the statement. "Even though we are appealing our SIFI designation in court and do not believe any part of MetLife is systemic, this risk of increased capital requirements contributed to our decision to pursue the separation of the business."
MetLife said Executive Vice President Eric Steigerwalt will lead the new company.