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New York Life Sets Many New Records In 2007

  • Operating Earnings Reach $1.28 Billion, Up 17% from 2006
  • Surplus and AVR Increase Over $800 Million to $14.7 Billion
  • Insurance Sales Increase 15%, Operating Revenue Climbs 9% to $13 Billion

NEW YORK, March 27, 2008 — New York Life Insurance Company, America’s largest mutual life insurance company1, set new records in 2007 for sales of insurance and investment products, as well as reached new highs in operating earnings, surplus, operating revenue, and assets under management.

Among the Significant Records New York Life Achieved in 2007:

  • Operating earnings increased 17% to $1.28 billion in 2007, from $1.09 billion in 2006.2
  • Operating revenue grew $1.1 billion, or 9%, to $13 billion in 2007. 3
  • Surplus and Asset Valuation Reserve (AVR) grew more than $800 million to $14.7 billion.
  • Total insurance sales exceeded $3 billion in 2007, an increase of 15%.
  • Total investment sales increased more than $900 million, or 3%, to $35.6 billion.
  • Assets Under Management increased by more than $18 billion to $280 billion in 2007.

2007 Reconciliations   2007 Financial Highlights

Sy Sternberg, chairman and chief executive officer, said, “The company’s operations had another year for the record books in 2007. We saw strong demand for our products across the board, including life insurance products, lifetime income products, long-term care insurance, retirement services and other institutional and retail investment products and services. The robust growth achieved in 2007 reflects outstanding execution of our strategies, including our focus on life insurance, on career agents, on remaining a mutual company, and of course, maintaining financial strength, a hallmark of our company. Surplus reached a new high of $14.7 billion, providing a superior cushion of safety and security for our policyholders. Surplus is an important metric at all times, but especially in difficult economic times as the nation is experiencing now.”

Strong Earnings

The company’s GAAP net income totaled $1.5 billion in 2007, compared with $2.3 billion in 2006 when a one-time, extraordinary gain skewed the results. The 2006 results included a $1,011 million gain from the company’s investment in Express Scripts, Inc., largely driven by a one-time change in accounting methodology. Adjusted for that one-time gain from Express Scripts, and excluding other investment gains, GAAP net income in 2007 increased 19% to $1.3 billion. Operating earnings, the company’s measure to track profitability from ongoing operations, increased 17% to a record $1.28 billion in 2007. This is on top of the 16% growth experienced last year with 2006 operating earnings of $1.09 billion.

Record Sales and Operating Revenue
Insurance sales increased 15% in 2007, to $3.03 billion, propelled by strong sales in International life insurance (up 25%) and lifetime income annuities in the U.S. (up 25%). New York Life is the largest seller of lifetime income annuities in the U.S., according to an industry source4. In addition, sales of life insurance through AARP increased 7% in 2007. Investment sales increased 3%, to $35.6 billion in 2007, driven by a 4% increase in sales at New York Life Investment Management, which saw particularly strong sales in its retirement services, retail markets and wholesale businesses. New York Life’s operating revenue increased 9% to $13 billion, a new company milestone, led by a 17% increase in operating revenue from International operations.

Review of Businesses

U.S. Insurance Operations

The company’s U.S. Insurance Operations include its Life and Annuity and Special Markets business units. Life and Annuity is the company’s largest revenue generator, selling a full array of products in the United States including individual, bank and corporate owned life insurance, lifetime income annuities and a variety of variable and fixed investment annuities. Key highlights of 2007 were:

  • Operating revenue in Life and Annuity increased 6% to $8.3 billion, compared with $7.8 billion in 2006.
  • New York Life continued its leadership in the Million Dollar Round Table, the industry’s most prestigious professional organization for agents, for the 53rd consecutive year. The company had 2,453 agents achieve this recognition in 2007, nearly a third of New York Life’s active field force in the U.S. New York Life also led the industry in the number of women agents qualifying for MDRT – more than 350 in 2007.
  • Special Markets, comprised of the four operations below, increased operating revenue by 14% to $1.6 billion, compared with $1.4 billion in 2006.
  • Through two AARP programs, New York Life is America’s leading direct marketer of life insurance, and in 2007 a new program offering lifetime income annuities to AARP members achieved $97 million in sales in its first full year.
  • New York Life is also the largest underwriter of professional association insurance programs in the United States, covering members of more than 500 associations across the country.
  • The company’s long-term care insurance operation ranks as the sixth largest provider in this field, according to an industry source5, with sales up 14% in 2007, versus industry sales that grew by 3%.

New York Life Investment Management

New York Life Investment Management (NYLIM), ranks among the largest asset management firms in the United States. Through its multiple boutique investment structure, NYLIM delivers investment performance through an array of products designed for both institutional and retail clients. Through its MainStay Investments brand, NYLIM distributes mutual funds and wrap accounts through agents and advisors to retail investors.

2007 was another year of record success for the business. With over $29.2 billion in gross sales, NYLIM exceeded its 2006 record by 4%. Net sales totaled over $2 billion, while operating earnings were up 28% to $219 million—with most lines of NYLIM’s business contributing to the increase.

Highlights from 2007 included:

  • Total assets under management reached more than $249 billion, as of December 31, 2007, up more than $13 billion from the previous year.
  • Guaranteed Products achieved record operating earnings of $132 million, with over $7.5 billion in sales.
  • New York Life Capital Partners closed its second mezzanine fund with $800 million of total capital commitments, $200 million above the fund’s original target of $600 million.
  • The Retail Markets business exceeded last year’s sales record by 15%. For the year, MainStay’s assets under management grew by 6%, exceeding $37 billion
  • MainStay ICAP Select Equity Fund and MainStay ICAP International Fund were both selected as Morningstar’s Top Fund Analyst Picks for 2007.
  • Retirement Plan Services achieved $3.7 billion in new sales for 2007, and ended the year reaching $151 million in operating revenue—a 16% increase over 2006.

New York Life International6

New York Life International, with operations in eight markets in Asia and Latin America including China, Hong Kong, India, South Korea, Taiwan, Thailand, Argentina, and Mexico, remains in growth mode, expanding rapidly in a number of the world’s most attractive emerging markets. Key highlights of 2007 were:

  • Operating revenue grew to $2.09 billion in 2007, up 17% over the prior year.
  • Insurance sales increased 25% to $652 million, driven primarily by exceptional growth in the company’s operations in India, Mexico and Thailand.
  • Insurance sales for Max New York Life, the company’s joint venture in India, increased 70% over the prior year. Max New York Life grew the number of licensed agents in India to nearly 28,000 and expanded its network of offices to 192 in 114 Indian cities.
  • Insurance sales in China grew 44% as the company’s joint venture entered six new cities, including the provincial capital of Hubei.
  • Overall, International’s career agent sales force continues to grow, with more than 41,000 agents registered in the eight markets.

New York Life Ratings Are Exceptionally Strong

New York Life’s financial strength/claims paying ability ratings are the highest possible in the industry from the four major rating agencies: Moody's Investors Service (Aaa), Standard & Poor’s (AAA), Fitch (AAA) and A.M. Best (A++).

In August 2007, even as the U.S. credit markets were experiencing their most severe deterioration in a decade, Standard & Poor’s announced its upgrade of New York Life’s financial strength rating to AAA, their highest ranking. This gives New York Life the highest possible financial strength ratings from all four major rating agencies, a distinction held by only two other life insurers.

New York Life Insurance Company, a Fortune 100 company founded in 1845, is the largest mutual life insurance company in the United States and one of the largest life insurers in the world. Headquartered in New York City, New York Life's family of companies offers life insurance, retirement income, investments and long-term care insurance. New York Life Investment Management LLC provides institutional asset management and retirement plan services. Other New York Life affiliates provide an array of securities products and services, as well as institutional and retail mutual funds. Please visit New York Life’s Web site at www.newyorklife.com for more information.

Note to Editors: New York Life was the number one seller of fixed immediate annuities in 2007, according to an industry source. Source: LIMRA International, U.S. Individual Annuity Sales Survey, Fixed Immediates, Fourth Quarter YTD 2007 results. (Fixed Immediates include Fixed Period Annuities.) New York Life also had the sixth largest market share in new long-term care insurance premium, according to an industry source. Source: LIMRA International, 2007 Individual Long-Term Care Sales, adjusted for level premium pay plans plus 10% of limited premium pay plans.

1Source: Fortune 500 2007 rankings (April 30, 2007 issue).

2See attached reconciliation of Accounting Principles Generally Accepted in the United States of America (GAAP) performance measures to non-GAAP performance measures.

3See attached reconciliation of Accounting Principles Generally Accepted in the United States of America (GAAP) performance measures to non-GAAP performance measures.

4Source: LIMRA International. See Note to Editors for more detail.

5Source: LIMRA International. See Note to Editors for more detail.

6All amounts at ownership interests.

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New York Life Sets Many New Records In 2007

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