GE Deal for MetLife's Deposits Still Lacks FDIC Approval

MetLife (MET) is still waiting to free itself from oversight by banking regulators.

The Federal Deposit Insurance Corp.'s board met Tuesday without taking action on a deal by the global life insurer to sell $7.5 billion in deposits from its online bank to General Electric (GE), the Wall Street Journal reported Wednesday.

The deal, which the companies announced in December, calls for GE's Capital Bank subsidiary to acquire $7.5 billion of deposits, including certificates of deposit and money market accounts, from the $9.4 billion-asset MetLife Bank. MetLife had previously decided to unload its bank charter because of the increased costs and demands of complying with federal regulations.

The transaction requires approval by the FDIC's five-member board because the agency supervises the $13.6 billion-asset GE Capital Bank, which would take custody of the deposits.

MetLife and GE had aimed to complete the deal by mid-2012.

An FDIC spokesman declined to comment on the pending transaction Wednesday. A GE representative did not respond to an email, and a MetLife spokesman said only that the insurer "is waiting for regulatory approval" of the deal.

The proposed sale took on added significance for MetLife in March when its bank became one of four deposit-taking institutions to fail a Federal Reserve stress test.

In June, the Fed extended until Sept. 30 the deadline for MetLife to submit a new capital plan.  The capital setback has blocked the insurer from raising its dividend or buying back shares.

MetLife said in December it would transfer assets not part of the proposed sale out of the bank, which began in 2001, as part of the wind down.