Are MetLife's Earnings Really that Great?

Metlife Reported a 12% drop in fourth-quarter profit to $985 million or $1.20 a share.  Metlife's earnings included a $1.6 billion gain on successful derivatives hedges.  These results are super, right?  Operating earnings only down 12% from the prior year, which is not a loss, and it beat analysts estimates?  The problem is that operating earnings are really only a small part of the story at many banks and insurers and I'm surprised that analysts still cling to them in this environment.  The real issue is the balance sheet, namely other comprehensive income (OCI.)  OCI accounts for investment gains and losses on certain assets that do not flow through the income statement.  OCI is instead reflected in shareholder's equity.  As assets are written down to reflect "temporary" changes in the value of securities, other comprehensive income is either added to shareholder's equity if it is a gain or subtracted if it is a loss.  Book value, a measure of assets minus liabilities, will either increase or decrease reflecting, more or less, what the company's assets are worth.

According to Bloomberg's earnings report, Metlife's book value per share declined 23% over three months to $27.33.  Gross unrealized losses on investment assets widened to $28.8 billion from $16.7 billion.  By my calculations, I get a loss of $12.1 billion on MetLife's investment portfolio.  Now I ask you:  Who cares about $935 million in operating earnings, when the company's assets declined in value by over $10 billion?