Prudential Declines on ‘Laundry List’ of Quarterly Costs

Prudential Financial Inc., the second-biggest U.S. life insurer, fell the most among the largest financial firms after reporting a loss on costs tied to currency fluctuations.

Prudential slid 4 percent to $56.16 at 11:06 a.m. in New York, the steepest drop on the 81-company Standard & Poor’s 500 Financials Index.

The fourth-quarter loss was $232 million, Newark, New Jersey-based Prudential said yesterday, as a slide in the yen against the dollar contributed to a $1.5 billion pretax cost tied to foreign exchange. Operating profit, which excludes some investments and the results of policies sold before the firm went public, fell short of analysts’ estimates.

“The stock is likely to pull back some, given noisy results,” John Nadel, an analyst at Sterne Agee & Leach Inc., wrote in a research note. “No quarter for PRU would be complete without a laundry list of unusual items and 4Q was no different.”

Prudential recorded charges related to acquisitions and had a $20 million cost to increase legal reserves in the group insurance segment. It booked $69 million of costs tied to an increase in employee benefits liabilities and a write-off of expenses related to debt issuance.

MetLife Inc., the largest U.S. life insurer, fell 2.2 percent to $36.73. The New York-based insurer is scheduled to report results Feb. 13.

To contact the reporter on this story: Zachary Tracer in New York at ztracer1@bloomberg.net

To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net