Hello again, everyone. I'm Ryan Krueger from KBW, really pleased to have MetLife with us this morning. Representing Met, we have Michel Khalaf, President and CEO, John McCallion, who is CFO, and John Hall, Head of Investor Relations. Thanks to all of you for joining. Michel, it's been about two years almost since you rolled out your Next Horizon strategy. Can you start by discussing how it's been progressing so far and also any changes that you've made to it along the way? Sure. Let me start by thanking you for having us, Ryan, and hopefully next time we can do this in person. Yeah. Really pleased with our progress in executing on our Next Horizon strategy. We designed the strategy to be all-weather, to serve us well regardless of the environment. Clearly, we did not have a pandemic in mind. I think the relevance of the strategy and the context of the current moment couldn't be stronger. I would say, if anything, the pandemic has been a catalyst for us to accelerate certain elements of the strategy. At its core, the strategy has three pillars, focus, simplify, and differentiate. I think we've made progress, and we've activated each one of these pillars. Focus is all about deploying capital to its best and highest use. We've made a number of divestitures, our auto and home business. More recently, we announced the divestiture of Poland and Greece. Really the intent there is to refocus or focus our efforts. We're also continuing to invest in growth, in new business, and we're doing so at attractive IRRs and paybacks. Simplify at the core is around driving expense efficiency. I think we're quite pleased that we are developing here the muscle, a culture of continuous efficiency, a real mindset. We said we're out of the business of having these large expense programs that are typically difficult to explain, to administer. By driving our expense ratio down, we are generating expense leverage that we can deploy in support of incremental investments in innovation and technology to enable growth. Of course, if the circumstances warrant, we can use that also to maintain margins. On the differentiate front, I would point to action we've taken in our group benefits business with the acquisition of Versant Health, which propels us as the third-largest vision care provider here in the U.S. and really adds a capability that is in high demand in terms of what our customers tell us. We're also leveraging our PetFirst acquisition by introducing a best-in-class pet insurance product. Again, something that is well appreciated by our customers. We also understand that actions are not enough. I think we made a series of financial commitments as part of our Next Horizon strategy back at Investor Day in December 2019. We talked about an ROE of 12%-14%, 65%-75% free cash flow, generating $20 billion of distributable cash over 5 years, and $1 billion in operating leverage. I'm pleased to say that we're on track to deliver on all of these commitments. Great. Thank you. I'll dig in a little bit more on expenses as the next question, which is, you did recently guide to a direct expense ratio below the 12.3% target that you previously had. Can you talk a little bit about the actions you've taken to achieve that and give us any sense of potential magnitude? Maybe I'll jump in on that one, Ryan, good morning, and again, thanks for having us. As you mentioned, we recently updated our guidance around the expense ratio. We've said for 2021 that we're now actually going to be below the 12.3% target. We had originally expected that to be slightly elevated this year. As we sold the P&C business, that had a lower expense ratio of somewhere in between 10%-11%. Really hats off to the team. I think to Michel's point before, this efficiency mindset has really become a part of the culture. I think it demonstrates the focus on execution across the management team. We're trying to focus on what we can control and move away from those serial expense programs, as Michel mentioned, really try to take a zero-based mindset on how we run our business, how do we continue to develop operating leverage. As a result of all that, we've been able and feel comfortable to say that we'll actually be under the 12.3% this year and continue to expect to be at or below that level in 2022. Look, this has been a long journey. If you think back to 2015, when we started the unit cost initiative that got us to where we are, we've probably built $1 billion of pre-tax margin. If you do the math, we're over 200 basis point improvement in expense ratio. Now as we look forward, we just got to keep building capacity, help deliver on the $1 billion-dollar commitment over the next five years, while also being at or below the 12.3%. It's all in for us. There's no exclusion of investments or anything like that. It's all part of our cost base. Can get lumpy in any one quarter, but on an annual basis, we think we can be at or below the 12.3% on a go-forward basis. Thanks. You mentioned the $1 billion, which I think was targeted for expense reinvestment into technology and innovation initiatives over a five-year planning period. Can you give us any update on that and how that's going so far? Yeah, sure. I think the good news here is that as I mentioned, we also envisaged this expense leverage as a buffer in case the environment worsens and we needed to use it in that fashion. Despite the pandemic and a very tough environment, we're pleased that we have not had to use it in that fashion. We've continued to make incremental investments in technology and innovation. I would add, Ryan, that those investments have served us really well, especially during the pandemic, where we've seen a sharp increase in adoption of digital tools and solutions. The investments that we had been making have served us well in terms of meeting our customers' expectations. Thanks. In U.S. group benefits, there have been quite a number of factors, I think, that have impacted your underwriting results during the pandemic. Can you talk a little bit about how the business is performing at this point, and also where you would see potential underwriting ratios trending in the second half of the year? Yeah, maybe I'll touch on that one. I think just to start, maybe the one comment around performance. Look, we really think overall that this business is performing well. Obviously, we're seeing elevated life claims as a result of COVID, but the underlying fundamentals of this business are strong. As Michel just referenced, we're making investments to emerge from the pandemic even stronger. Overall, while that COVID environment is still with us, we've seen an improvement in that in the last few quarters. We don't see this situation as permanent, and we're thinking about the future. We're excited about the investments that we made to enhance the platform and the product offerings that we have, and really how we can strengthen our lead here in this business. If I turn to underwriting ratios. Certainly starting with the group life mortality. We are seeing elevated ratios, given the excess mortality associated with COVID. 94.3% was our ratio in the second quarter. That compares to a range of, call it 85%-90%. That's usually our target. We are seeing some elevated mortality. That was a pretty large improvement from Q1. I think, our relationship to what happens with total U.S. deaths has been pretty stable from quarter to quarter in terms of excess mortality. That trend continued to decline in July. However, we have seen a bit of a bounce back in total U.S. deaths in August and early September. It's a fluid situation. I think having said all that, we still expect the second half of the year to be better than the first half, particularly given just the sizable loss or the sizable COVID claims in the first quarter. We're watching it closely. I think some of the national projections have grown in terms of excess deaths. I think we would expect our mortality to align to whatever those excess deaths trend. That's on group life. If we move to non-medical health, that actually has really reverted back to pre-pandemic levels. We've seen just a more normal level of utilization in dental. We've seen a reversion to pre-pandemic levels in terms of disability incidents. The second quarter, I think, was 73.8%. That range that we typically target is 70%-75%, so well within the range that we look for on a normal basis. We'd expect that to be the same as we look forward for the rest of this year. Thanks. I had a pretty similar question on the top line in Group Benefits, which is how has the pandemic and the economic environment impacted the top line in that business, and where do you see growth trending in the future? Yeah. We're very pleased with our top-line growth in Group Benefits. As we mentioned on our earnings call, PFO growth was about 12%, which is in line with the outlook that we provided of double-digit growth for 2021. If you break that down, 6% of that 12% came from Versant, in line with expectation. Versant has been very well received by customers, by intermediaries. Integration is going well, so that's positive. The other 6%, in terms of underlying growth, is at the high end of our 4%-6% near-term outlook. A number of factors contributing to that. One is that this has been a strong year for jumbo cases, and we tend to win our fair share, and that's been the case this year. Our persistency continues to be strong. We're getting the renewal action that we deem to be appropriate. We continue to see strong traction in voluntary that's growing at double digits from a PFO perspective. We're also pleased with sort of the overall trajectory of that business because we believe that the momentum that we have there is sustainable. If you think about our brand, I reference some of the products and capabilities that we've introduced and some of the investments we've made in digitizing our business as well. All in all, really pleased in terms of the growth that we're seeing in Group Benefits this year. As a follow-up, MetLife has long been a pretty dominant player in the large case market in Group Benefits. I know you've had efforts to further penetrate the small to medium sized business market as well as voluntary benefits. Can you give us an update on your progress with that? Sure. Maybe I'll start by saying that, as you referenced, we have a strong position in the large case segment, but we also still see opportunity to further grow there. We've been growing faster than market. We've been increasing our market share there. I think we see a runway for us to continue to do that. Especially with the intensifying competition for talent, I think there is a great appreciation on the part of employers as to sort of the importance of offering a comprehensive benefits package to their employees. From an employee perspective, I think with the pandemic, there's also an appreciation of the importance of some of the benefits that we provide. We also see the opportunity to grow in the small to mid-size market. We already generate about $5 billion in PFOs in the small to mid-size group benefits market today. The opportunity here is that three out of four employers in that space don't offer any voluntary benefits. This is a market that's typically dominated by brokers. We've invested in analytics to better understand which brokers best align to our value proposition. We continue to see broker consolidation in that space as well. We think that's a favorable trend given the relationships that we enjoy with the large mid-size brokers as well. Then, I go back to the fact that our product portfolio, given its breadth, allows employers to deal with a single carrier as opposed to having to deal with multiple carriers based on different product sets. On the voluntary benefits front, as I mentioned, we're continuing to see double-digit PFO growth there. We think voluntary benefits are becoming more strategic for employers, important for employees as well. We've also invested in our enrollment and re-enrollment capabilities here, which is helping us further our traction there. All in all, I think our strategy, our focus is sort of enabling us to grow in those segments, whether it's small to mid-market or voluntary. Thanks. In the U.S. retirement business, you've typically had a 2%-4% target of annual growth in the liabilities there. You've been exceeding that, at least in the last year or two. Can you give us any sense of kind of the key drivers of that and also, if you think that better growth can continue? Yeah, sure. I'll take that one, Ryan. I would just highlight this is an institutional business that we've had a leadership position in, a long history, and another diversified set of product mix and set that we have there. That diversified set of products is really meant to perform well in a variety of different conditions. That's kind of what we've seen of late. Certainly, you can get some outsized growth in any one year as a result of those conditions shifting, and I think we've seen that recently, whether it's our stable value products during 2020, when we saw a big shift in migration towards that. Whether the conditions are, as we're starting to see, are starting to open up for PRT. It's nice to have different options at different times to take advantage. As I think about growth, maybe just as an example, we grew our liability exposures, and that's typically, as you said, our measure of growth and how we think about the progression in this business. We grew it at roughly 8% recently. About 3% of that was on our general account products. Think about that as our annuities and our capital market products and think spread business. The remaining five was more fee oriented, where it's more like our synthetic GIC product, as well as our longevity reinsurance product in the U.K. that we just entered recently, and we're up to 9 billion of notional at this point. It's a market we entered last year. We've seen some great traction and success there. I think we've closed just over 10 deals. Very pleased and happy with how that's gone and kicked off. Thinking while we've grown at 8%, I'd say this is a lumpy business, and as I think about trends in terms of growth for this business, we're working off a large base. I think 2%-4% is still a reasonable trend to consider here. Got it. I know you talked about this some on the second quarter call, wanted to revisit the retirement spread. It did widen quite a bit in the second quarter. I know you have some nuances with how interest rates impact the spread there. Can you talk a little bit more about what happened to drive that and how we should think about the spread in that business in the second half of the year? In Retirement and Income Solutions or RIS, spread is obviously a key driver of those earnings. Within the spread, variable investment income is a key component, too. That's been one of the drivers of the outsized returns and quite honestly, strong earnings that we've seen in the first half for RIS. Let me touch on private equity VII first. I think it's important to note that our private equity accounts are recorded on a one-quarter lag. Of late, we've seen some deviation in that relationship of returns to the broader market versus private equity. Just as an example, I think Q2, we saw a return of 9.7%. If you go back a quarter and think about the S&P and Nasdaq, they were at a return of 5.8% and 2.8%. If you were to go back even one quarter and think about the return in the first quarter, it was a 13.3% return for private equity. If you go back to the fourth quarter, we saw, I think, 11.7% and 15.4% for S&P and Nasdaq, respectively. Typically, our private equity returns would be more muted than the broader volatility you'd see in the general markets. We've seen that's kind of changed over the last three quarters. We still expect that this will migrate back to historical trends. Obviously the VC market, the IPO market, they've all been pretty frothy recently, and that has positively benefited our private equity returns. I think thinking into the third quarter, people should anchor themselves on the fact that S&P's returned, I think 8%-ish number and a 9% rough number for the Nasdaq. We're expecting above trend or above general expectations, which has typically been about a 3% return on private equity a quarter. We're thinking it's going to be elevated or higher than that in the third quarter. That's private equity and VII. If you extract that from the spreads, they've also been very healthy this year and above our expectations, certainly relative to what we laid out in the beginning of the year. The second quarter, we had a 98 basis point spread. That's probably 15 to 20 points above what we expected on any one quarter. One of the big drivers that has driven that is we've seen these elevated paydowns in the residential mortgage market impact some of our securities and loans, and it's accelerated some income on those securities or loans that we've purchased previously at a discount. There's typically a lag in what we're seeing in terms of when it happens versus when it comes through our securities, maybe two to five months. As a result, we still think we'll see some elevated paydowns, maybe not to the level we saw in the second quarter, but maybe something closer to the level we saw in the first quarter for the remainder of this year. As we look out, we still think we'll be probably elevated relative to, let's say, the outlook we provided back in February. Great. No, thanks. That was helpful. Michel, you touched on this a little bit, but in the last year, you've divested the P&C business and your Poland and Greece operations. Can you talk about your view of the current business portfolio at MetLife and if you would expect more divestitures over time? Sure. Let me begin by saying that we have a well-diversified set of market-leading businesses, and I think that diversification was really on full display during the pandemic, just in the offsets we have from an underwriting perspective. Specifically to the divestitures you referenced, we closed on the Auto & Home sale to Farmers in early April. We have a 10-year distribution relationship with Farmers. We think this allows each company to focus on what it does best. Farmers has 90 years of underwriting and service excellence. We can leverage our distribution strength and relationships as well to offer best-in-class products to our customers. On the Poland and Greece divestiture, which we announced in July, we expect to close in the first half of 2022. We sold those businesses for $700 million or just over $700 million. This was really very consistent with our Next Horizon strategy, in terms of focusing our efforts and simplifying the company operationally. Those two businesses account for about 10% of EMEA earnings. Again, very much consistent with what we've said in terms of our strategy, especially the focus pillar. To answer your broader question, I would say that we continuously look at our portfolio through the lens of strategic fit and whether the businesses in the portfolio are meeting or exceeding our minimum risk-adjusted hurdle rate. If a business is not achieving that, and we don't see a reasonable path to it achieving that, we consider options, and one of the options, potentially, is a divestiture. This is a process that will continue. I would also maybe just remind that this is really not new to us. Since the Alico acquisition, we've divested nearly 40 businesses. This is something that we're going to continue to do and, as I said, very consistent with our strategy. Thanks. For MetLife Holdings, which is in runoff, it seems like probably the risk transfer market is about as active as maybe it's ever been. I know you get this question all the time, but can you give us your latest thoughts on the potential to accelerate the runoff of MetLife Holdings through reinsurance or other risk transfer over time? Yeah, thanks. Yes, it is a recurring question. Look, I think it is a dynamic in this industry that has evolved, as you said, pretty quickly and has become, in a way, its own marketplace and a core business for some. It's a component as to what we think about as we optimize and manage MetLife Holdings. It's not the only component, but I think our view is how do we maintain optionality to, I'll say, appropriately accelerate the runoff. As you say, accelerate the runoff, I would just add appropriately. We wouldn't do it at any cost. We feel very comfortable with managing and continuing to optimize this within the company, but we are continuing to talk with third parties and think about opportunities to appropriately accelerate the capital release and the runoff of that block, if it makes financial sense. I'd say that incrementally, every quarter, there seems to be, I would say, more momentum in the space, but there's still a bid-ask spread headwind from just market dynamics and low interest rates and things like that. I think in the past, you had said that there could be distinct buyers for different parts of- Yeah MetLife Holdings. Is that still most likely the case in your view? Yes. I think as this market evolves, I think certain buyers will expand their appetite too. Okay. Got it. Moving into your international operations, this is, I guess, probably a pretty broad question. Can you talk about how the pandemic is impacting growth in both Asia and Latin America? Where we are in the process of getting back towards more of a normal environment in those countries and regions? Sure. If I start with Asia, the COVID impact has not been an underwriting one for Asia, we don't expect that to change. It's been mostly a top-line impact because of the lockdowns and the social distancing rules in most of our key markets, including Japan. We have seen a recovery in sales since the second quarter. For the first half of the year, we had 25% year-on-year growth. Of course, we're also comparing to a weak period, we still think that for the year, we had guided during the outlook to double-digit sales growth. We still think that will hold. The situation with COVID is still evolving, I think the fact that our teams are executing extremely well on the ground. We've launched a number of products that have been well-received. We're well-diversified from a distribution and product standpoint in Asia, which is an advantage. We've made important investments also in digitizing our sales process and underwriting process as well. I think that not only is serving us well in this environment, but would also have a lasting effect post-COVID. For Latam, it's really been an underwriting impact from COVID. We had $150 million in underwriting impact in the first quarter, $66 million in the second quarter. We were seeing significant improvement. However, the situation is fluid. I think what John referenced earlier in terms of what we're seeing on the group front holds true in terms of what we're seeing in Latam as well. Having said that, we still expect the second half of the year to be better than the first from an underwriting perspective. The other thing I would point to in Latam is really the strength of our franchise. We had mentioned on the earnings call that sales were up 55% year-on-year and back to pre-pandemic levels. PFO growth is 12%, which speaks to the, again, strong persistency that we have. Our distribution capabilities are intact. That's why we believe that in 2022, provided that the COVID situation does not deteriorate, we think Latam can be back to its normal run rate in terms of contributions to our overall earnings. Are a lot of the sales in Latam able to be done digitally at this point as you've dealt with the pandemic? A much higher percentage of sales. At least we're using digital tools to enable sales. That's true. Those are all retail businesses. I would say it's more of a hybrid model. Certainly digital tools are being very helpful to us in this regard. Thanks. On buybacks, you've definitely had a pretty high level of buybacks in recent quarters, but are in, I guess, the good position of still having a good excess capital position at the holding company. How should we think about the potential to work down the excess capital back towards the $3 billion to $4 billion cash target at the holding company? Yeah. As you mentioned, Ryan, we had $6.5 billion at the end of the second quarter in cash and liquid assets, well above the $3 billion to $4 billion buffer. We're still comfortable with the $3 billion to $4 billion buffer and over time, we would get back to those levels. One of our highest priorities is to continue to invest in growth. We continue to do that at attractive IRRs and paybacks. We're also quite disciplined when it comes to M&A. We have sort of a global approach that we apply to any deal. Strategic fit is the first criteria. We apply a set of financial metrics. We expect an M&A deal to help us accelerate revenue growth and to clear those metrics, including accretion. In the absence of these opportunities, what we've said is that we're going to return excess capital to shareholders. As you said, I think we've built a track record in this regard. I think that should give folks an indication as far as our pacing and our recent activity should. We have a new $3 billion authorization from our board, which again, should give an indication of its sustainability. On M&A, are there any particular areas that you're looking to add more capabilities to, either in particular businesses or geographically? Can you give us any sense on that? I would say first that I don't see any major gaps in terms of our portfolio of businesses. Having said that, there are businesses that we like and that we continue to be interested in accelerating growth. Group benefits is a case in point, and we did Versant Health and PetFirst before. Asset management is another area I would point to. We did Logan Circle three years back. That was a good acquisition. Again, strategic fit is very important. We will look at opportunities that fit well in terms of our strategy, and then as I said, we would apply the same discipline in terms of the financial metrics. We would compare also M&A to other potential users of capital. On free cash flow, the 65%-75% free cash flow conversion target, if we were to stay in the current interest rate environment where the 10-year Treasury seems to be hovering between 1% and 1.5%, do you see any risk to achieving that target? Yeah, no. We don't see any risks, I think we're comfortable in the 1%-1.5% level of achieving the 65%-75%. I think, again, just kind of goes back to a lot of hard work over the years to build a resilient model that performs well in a variety of macroeconomic environments. We're getting close to the end of time. I wanted to ask one more on everyone's favorite topic, which is GAAP LDTI. Any sense of kind of where you guys are in the process of preparing for that and when you might consider educating the market on the potential impacts? Yeah, sure. We're in it deep, I guess would be my way of describing where we are. It is very complex in terms of just getting through and the modeling and the review. I'd say in terms of timing of information, sometime in second quarter of 2022 would be my guess around when we would disclose some information. I'd say things are going well so far. As I've said before, we have a kind of a positive outlook on this. We think the industry's working very well together. There's a number of industry groups and trying to kind of come through this with a consistent way of messaging how we look at our results as a collective group. It's been good. Great. Can't say I'm looking forward to that, but we'll all deal with it. Thank you, Michel, John, and John, for participating. Much appreciated. We will leave it there. Okay, great. Thank you, Ryan. Thank you, Ryan. Thank you, Ryan. Take care. Take care. Thank you.