Out of life.

This article focuses on Citigroup's sale of its life and annuities division to Metropolitan Life Insurance. On January 31, 2005 Citigroup said that it was selling its life and annuities division to MetLife, America's second-biggest life insurer, for $11.5 billion. The price is hardly dear. MetLife is paying less than 13 times last year's earnings for a vast book of business and access to Citigroup's huge distribution network. Citigroup clearly wants to be rid of insurance. Having spun off a property and casualty arm in 2002, it has largely dumped a business that not long ago it sought to expand. Citigroup says that insurance has worse growth prospects and a lower return on capital than its other businesses. Fine--but that argument implies that it should concentrate on credit cards, Smith Barney and consumer finance, and quit everything else, including retail banking. The question is why Citigroup should frown on insurance in particular. Both Citigroup and MetLife pointed to the consolidation of America's insurance industry as a justification for the deal.