(Bloomberg News) MetLife Inc.'s Steven Kandarian, who has presided over an 18 percent stock decline in less than a year as chief executive officer, told investors he is prepared to cut the insurer's weakest businesses to boost results.

"We are committed to achieving returns in excess of our long-term cost of capital," Kandarian, also MetLife's chairman, said in a letter posted on the New York-based company's website yesterday. "We will not achieve this goal overnight. But over time, we will fix or exit businesses that cannot consistently clear their hurdle rates."

MetLife, the biggest U.S. life insurer, underperformed the Standard & Poor's 500 Index three of the last four years as it expanded by acquisition and became the No. 1 seller of variable annuities. Kandarian, promoted from chief investment officer in May, has retreated from businesses in Taiwan and the U.K. and started unwinding MetLife's banking unit. Variable-annuity sales will be curbed in 2012, MetLife said in December.

"We are committed to taking a portfolio view of our businesses," Kandarian said in the letter, which accompanied the insurer's annual report and was dated March 16. "No business is automatically entitled to capital. All must compete on the basis of which will deliver the most value to shareholders."

The S&P 500 rose about 4 percent through yesterday since Kandarian, 60, took over as MetLife CEO from Robert Henrikson. The index has advanced 13 percent since Dec. 31, less than the 23 percent gain in MetLife.

Buyback, Dividend

The exit from banking will reduce oversight from U.S. regulators and give MetLife the ability to buy back stock and raise its dividend, the company has said. The curbs on equity- based variable annuities will decrease risk, while the businesses in the U.K. and Taiwan weren't able to meet Kandarian's standard for returns, MetLife has said.

Kandarian agreed to sell about $7.5 billion of bank deposits to General Electric Co. and planned the elimination of most of the 4,300 jobs at MetLife's mortgage-origination operation. Kandarian, whose plan to buy back stock was rejected this month by the Federal Reserve, reiterated in the letter that MetLife will deregister as a bank holding company by the end of the second quarter.

"MetLife remains committed to creating shareholder value and returning excess capital to shareholders," Kandarian said.

MetLife fell 30 percent last year, compared with little change in the S&P 500. The insurer rose 1.4 percent in 2009, while the S&P 500 surged 23 percent, and fell 43 percent in 2008 as the index slid 38 percent. MetLife beat the S&P 500 in 2010 when the insurer gained 26 percent, compared with the 13 percent advance in the index.