Life insurers have had a tough time of it since the financial crisis, as falling interest rates and decreasing interest in their core products collude to chronically depress profits. Giant insurer MetLife (MET 3.42%) reported earnings that reflected that new reality, but also offered up some good news, likely because of its ambitious program of trimming sections that don't perform, and adding new ones that promise to bring home the bacon.

Results were a mixed bag
On the bright side, MetLife's EPS exceeded analysts' expectations, and operating earnings rose 47% from last year, to $1.4 billion versus last year -- though Q3 2011 was dragged down by some issues affecting the company's Americas unit. Net investment income was up 2% year over year, coming in at $5 billion. Although the insurer's total operating revenues increased slightly from one year ago, estimates fell short by $500 million.

Unfortunately, premiums were down by 1%, and constricting credit spreads spurred a pre-tax loss of $543 million, compared with a gain of $2.8 billion in the year-ago quarter. The company notes, however, that neither gains nor losses in this area affect MetLife's bottom line.

An ambitious plan to boost the bottom line
MetLife has always kept its eye on the bottom line, and it has been proactive as it sees threats that may impact profits in a negative way. CEO Steven Kandarian has been on a tear since early spring to cut out those areas that are not adding to profits. A protracted transaction concerning a sale of MetLife's banking business to General Electric's (GE 1.74%) GE Capital unit was recently given a boost when both parties changed the terms in order to smooth the regulatory path. With insurance regulators already instituting new capital rules, cutting its banking arm loose will take some of the regulatory scrutiny off of MetLife.

Like Prudential Financial (PRU 3.44%), MetLife has stopped offering certain products such as long-term care insurance in North America because of waning demand. One exception is a new partnership with Walmart (WMT 0.63%), in which Metlife is selling prepaid, pre-packaged life insurance policies to the bargain retailer's customer base.

Other new projects include an expansion into Latin America, much like Prudential has done. MetLife has opened offices in Brazil in order to begin writing agricultural loans, a market that may well double in the near future from its present $53 billion value. In addition, the company has launched an asset management business, MetLife Investment Management, and has put a new face on its private placement debt section, now called MetLife Private Capital Investors.

One Fool's take
MetLife has always been forward-looking, as evidenced by its interest rate hedging program, instituted nearly 10 years ago on the chance that interest rates would fall precipitously. This year, and probably next, will be uneven for MetLife as it finally sheds its banking concern and begins to reap the rewards of newly launched programs -- both for itself, and its investors.