March 22 (Bloomberg) -- MetLife Inc., the largest U.S. life insurer, promoted the manager who oversees its $450 billion investment portfolio to be the next chief executive officer.
Steven Kandarian, 59, will replace Robert Henrikson on May 1, MetLife said yesterday in a statement. Henrikson, 63, who expanded in Japan this year with the purchase of a life unit from American International Group Inc., will remain chairman through the end of this year, New York-based MetLife said. He reaches mandatory retirement age in 2012.
Kandarian’s portfolio has grown about 75 percent in his six years as chief investment officer, as Henrikson and Robert Benmosche, who was MetLife CEO until 2006, acquired businesses outside the U.S. Kandarian, a former private-equity executive, braced MetLife for the housing slump by selling Manhattan’s largest apartment complex in 2006 at a $3 billion gain.
“It may harken a change coming out of the crisis that managing risk is going to be ascendant” over expansion of sales, said Steven Schwartz, an analyst with Raymond James & Associates Inc. who has a “market perform” rating on MetLife. “Kandarian comes with that mindset.”
MetLife built Stuyvesant Town and Peter Cooper Village on Manhattan’s East side in the 1940s for soldiers returning from World War II. Tishman Speyer Properties LP and BlackRock Inc., which purchased the 80-acre, 11,200-unit developments from MetLife for $5.4 billion, defaulted on their $3 billion mortgage in 2010.
Kandarian, who joined MetLife in 2005, is replacing a CEO who has been with the firm for almost four decades. Henrikson started at MetLife in 1972 as a sales representative.
Kandarian was executive director of Pension Benefit Guaranty Corp. from 2001 to 2004. He was an Orion Partners LP managing partner and a managing director of Lee Capital Holdings, a Boston-based private-equity firm, MetLife said.
MetLife slipped 74 cents to $43.85 at 5:12 p.m. yesterday in extended trading in New York. It has advanced 6.6 percent in the past year.
Kandarian is faced with integrating American Life Insurance Co., the unit known as Alico that Henrikson bought from AIG for $16.2 billion in November. The deal, which adds customers from Chile to Poland to Japan, was MetLife’s biggest, ahead of the $11.7 billion acquisition of Travelers Life & Annuity that Benmosche completed in 2005. Benmosche is now the CEO of New York-based AIG.
Kandarian oversees more than $320 billion in fixed-income holdings, including corporate debt, government bonds and asset-backed securities. The company has more than $50 billion in mortgages. The Alico acquisition prompted Kandarian to scale back holdings of financial-firm corporate debt because of a “heavy concentration” in the securities.
“Mr. Kandarian is a known quantity for the investment community,” said Jonathan Hatcher, a strategist who covers financial institutions at Jefferies Group Inc. in New York.
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