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New York Life Reports 2008 Financial Results

Operating Earnings of $1.28 Billion Surpasses 2007 Record
Operating Revenue Reaches $14 Billion, Up 8% from 2007;
Insurance Sales Increase 13%
Investment Sales Rise a Strong 7% in Challenging Economic Environment

NEW YORK, N.Y., April 8, 2009 – New York Life Insurance Company, America’s largest mutual life insurance company*, set new records in 2008 for sales of insurance and investment products and reached new highs in operating earnings and operating revenue.

Among the significant achievements for New York Life in 2008 were new company highs in all of the following areas:

  • Operating revenue grew more than $1 billion, or 8% over 2007, to $14.01 billion.
  • Operating earnings reached $1.283 billion in 2008, slightly exceeding 2007’s result.
  • Total insurance sales surpassed $2.4 billion, an increase of 13% over 2007.
  • Total investment sales rose to more than $26.6 billion, an increase of 7% over 2007.

2008 Financial Highlights

Ted Mathas, president and chief executive officer, said, “Despite the headwinds of the global financial crisis, the company’s operations performed well in 2008. Our mutual structure enables us to remain focused on serving the long-term needs of our policyholders, without the short-term pressures that come from public ownership. This long-term focus has enabled us to pay a cash dividend to policyholders for 155 consecutive years. The benefits of the mutual structure are resonating even more with the public today, as we saw strong demand for our products across the board, including life insurance and lifetime income products, as well as fixed annuities through agents and banks. This continued growth achieved in a difficult environment reflects sound execution of our strategies, including our focus on life insurance, on career agents, on remaining a mutual company, and of course, maintaining unquestioned financial strength.”

Strong Surplus Position

Surplus, the cushion of safety for policyholders, declined 13% in 2008 to $12.8 billion. Mr. Mathas said, “While our operations performed well, we are not immune from the effects of the financial crisis. As a result of the weak equity and credit markets, surplus declined by about $2 billion. However, surplus is a buffer of safety for our policyholders – a kind of rainy day fund – and it is serving its purpose in this economic rainstorm. Having built up the company’s surplus by $6 billion over the prior five years to provide an extra cushion of safety, policyholders can continue to feel safe and secure with New York Life. In fact, we have more than enough capital to achieve our strategic objectives and maintain a healthy cushion of safety. Therefore, New York Life has sought no capital from the government.”

Strong Operating Earnings

Operating earnings, the company’s measure to track profitability from ongoing operations, was a strong $1.283 billion in 2008, exceeding the all-time record operating earnings of $1.278 billion in 2007. “Considering the headwinds of the financial crisis, the very strong level of operating earnings in 2008 is a remarkable achievement. Many U.S. life insurers in 2008 reported significant declines in their earnings base, so it is a rare accomplishment in this environment to set a new record for operating earnings,” Mr. Mathas said.

Record Sales and Record Operating Revenue

Insurance sales increased 13% in 2008, to $2.43 billion, propelled by strong sales in International life insurance (up 21%) and lifetime income annuities in the U.S. (up 55%). New York Life is the largest seller of lifetime income annuities in the United States, according to an industry source**. Insurance sales through the Agency channel set a new record in 2008. In addition, sales of life insurance through AARP increased 8% in 2008.
Investment sales increased 7% to $26.6 billion in 2008, driven by exceptional growth in individual annuity sales. The company experienced very strong sales of fixed deferred annuities from agents and through its many bank and broker-dealer partners.
New York Life’s operating revenue, the company’s measure to track revenues from ongoing operations, increased 8% to $14.01 billion, a new company milestone driven by sales of lifetime income annuities and investment annuities.

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 2008 were:

  • New York Life continued its leadership in the Million Dollar Round Table, the industry’s most prestigious professional organization for agents, for the 54th consecutive year. The company had 2,167 agents achieve this recognition in 2008, nearly a third of New York Life’s active field force in the United States. New York Life also led the industry in the number of women agents qualifying for MDRT in 2008.
  • New York Life recruited a record number of financial representatives in 2008, with 3,534 appointments in the United States, up 8.4% over 2007.
  • New York Life is America’s leading direct marketer of life insurance through a program with AARP geared to its membership.
  • 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.

New York Life Investments***

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

New York Life Investments performed well in 2008 considering the challenging environment for the business. Key highlights included:

  • Gross sales were the third highest in the company’s history.
  • Barron’s latest ranking of mutual fund families ranked the MainStay fund family with their highest-ever annual performance ranking, based on their strong, long-term, relative investment performance. The family of funds ranked #5 (of 53) over five years and #6 (of 48) over ten years. The family also ranked #16 (of 59) for one year. The rankings for 2008 represent MainStay’s highest relative ranking in each listing over the past six years. (Barron’s, “The Best Families in a Bruising Year,” February 2, 2009)
  • New York Life International

    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, expanded rapidly in a number of the world’s most attractive emerging markets. Key highlights of 2008 were:

    • Continued strong revenue and earnings, driven primarily by Mexico, along with exceptional growth in the company’s operations in India and South Korea.
    • Overall, International’s career agent sales force continues to grow, with more than 81,000 agents registered in the eight markets.

    New York Life Ratings Are Exceptionally Strong

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

    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 Investments 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.

    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 2008, according to an industry source. Source: LIMRA International, U.S. Individual Annuity Sales Survey, Fixed Immediates, Fourth Quarter YTD 2008 results. (Fixed Immediates include Fixed Period Annuities.) New York Life also had the sixth largest market share in new individual long-term care insurance premium, according to an industry source. Source: LIMRA International, 2008 Individual Long-Term Care Sales, adjusted for level premium pay plans plus 10% of limited premium pay plans.

    * Source: Fortune 500 2008 rankings (May 5, 2008 issue).
    ** Source: LIMRA International. See Note to Editors for more detail.
    *** See Note to Editors for additional information.

    About the Barron’s ranking: A fund family must have at least three funds in Lipper’s general U.S.-stock category, one in world equity (which combines global and international funds), one mixed-equity fund (which holds stocks and bonds), at least two taxable-bond funds, and one tax exempt offering. Each fund’s returns are adjusted for 12b-1 fees. Sales charges are not included in the calculation of returns. Each fund’s return is measured against those of all funds in its Lipper category, leading to a percentile ranking, with 100 the highest and 1 the lowest, which is then weighted by asset size relative to the fund family’s other assets in its general classification. Finally, the score is multiplied by the weighting of its general classification as determined by the entire Lipper universe of funds. The category weightings for the one-year results: general equity, 42.4%; world equity, 14.4%; mixed equity, 16.9%; taxable bond, 22.0%; tax-exempt bond, 4.2%. The fund family with the highest score wins, both for every category and overall. The same process is repeated for the five- and 10-year rankings. Source: Barron’s, 2/2/09. Ranking data from Lipper.

    Please call 800-MAINSTAY (624-6782) for a prospectus. Investors are asked to consider the investment objectives, risks, and charges and expenses carefully before investing. The prospectus contains this and other information about the investment company. Please read the prospectus carefully before investing.

    Securities distributed by NYLIFE Distributors LLC, 169 Lackawanna Avenue, Parsippany, New Jersey 07054.

    MainStay and MainStay Investments are registered names under which New York Life Investments does business. New York Life Investments serves as the investment manager of the MainStay Funds. New York Life Investments is a service mark used by New York Life Investment Management Holdings LLC and its subsidiary, New York Life Investment Management LLC.

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New York Life Reports 2008 Financial Results

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