By the numbers, we reported first quarter 2021 adjusted earnings of $2 billion or $2.20 per share, up 39% from $1.58 a year ago.
Net income for the quarter was $290 million, down from $4.4 billion a year ago, primarily due to losses on derivatives that protect our balance sheet from declines in equity markets and interest rates.
Regarding variable investment income, the key driver of gains in the first quarter was our private equity portfolio, which delivered returns of 13.3%.
Adjusted earnings were down 70% year-over-year on elevated COVID-19 life claims.
In the US, overall COVID-19-related deaths were 40% higher in the first quarter of 2021, than they were in the fourth quarter of 2020.
For MetLife, our Group Life mortality ratio was 106.3%, well above the high end of our target range of 85% to 90% with approximately 17 percentage points attributable to COVID -19 claims.
The top line performance of the Group Benefits business was strong with sales up 46% year-over-year.
Adjusted PFO growth was also solid at 16% with the addition of Versant Health being a large contributor.
In retirement and Income Solutions or RIS, adjusted earnings were up 92% year-over-year, driven by higher VII.
Adjusted earnings were up 70% year-over-year on a constant currency basis, driven by higher VII.
Sales in the region were up 12% on a constant currency basis, even with the COVID resurgence in certain markets.
In Latin America, adjusted earnings were down 57% year-over-year on a constant currency basis, primarily due to the pandemic.
COVID-related claims in the quarter totaled approximately $150 million, mainly in Mexico.
In EMEA, adjusted earnings of $71 million were down 11% on a constant currency basis on higher COVID-related claims as well as higher expenses compared to the favorable prior-year quarter.
Sales were up 4% on a constant currency basis with strong momentum in the UK employee benefits space.
Turning to cash and capital management, MetLife ended the first quarter with cash at the holding company of $3.8 billion near the top end of our $3 billion to $4 billion target buffer.
Our two-year average free cash flow ratio remains within our guidance range of 65% to 75%.
Currently, our cash balances are much higher following the receipt of $3.94 billion of proceeds on the sale of our US P&C business.
During the quarter, we were pleased to return $1.4 billion of capital to shareholders, $1 billion in share repurchases, and approximately $400 million in common stock dividends.
So far in Q2, we have bought back an additional $210 million of common shares, and we have roughly $1.6 billion remaining under our current repurchase authorization.
Last week, our Board of Directors approved a second quarter 2021 common stock dividend of $0.48 per share, up 4.3% from the first quarter.
Over the last decade, we have increased our common dividend at a 10% compound annual growth rate.
In Japan, for example, 95% of our policy submissions are now done digitally.
Starting on page 3, we provide a comparison of net income to adjusted earnings in the first quarter.
Net income in the quarter was $290 million or approximately $1.7 billion lower than adjusted earnings.
On page 4, you can see the year-over-year comparison of adjusted earnings by segment.
Adjusted earnings per share benefited from exceptionally strong returns in our private equity portfolio and were up 39% and 38% on a constant currency basis.
Moving to the businesses, starting with the US group benefits, adjusted earnings were down 70% year-over-year, largely driven by unfavorable group life mortality due to elevated COVID-19-related life claims.
Group Benefits sales were up 45% year-over-year primarily due to higher jumbo case activity.
Adjusted PFOs were $5.6 billion, up 16% year-over-year due to solid volume growth across most products, the addition of Versant Health and roughly five percentage points related to higher premiums from participating contracts, which can fluctuate with claims experience.
Retirement and Income Solutions or RIS adjusted earnings were up 92% year-over-year.
RIS investment spreads were 234 basis points up 120 basis points year-over-year primarily due to higher variable investment income.
Spreads excluding VII were 88 basis points, up 5 basis points year-over-year primarily due to the decline in LIBOR rates.
RIS liability exposures including UK longevity reinsurance grew 12% year-over-year due to strong volume growth across the product portfolio, as well as separate account investment performance.
The notional balance stands at $8.8 billion at March 31, up nearly $5 billion from year end 2020.
The sale of the Auto and Home Business to Farmers Insurance closed on April 7, and we expect to record an after-tax gain of approximately $1 billion in 2Q 2021.
Moving to Asia, adjusted earnings were up 78% and 70% on a constant currency basis, primarily due to higher variable investment income as well as volume growth and favorable underwriting margins.
Asia's solid volume growth was driven by higher general account assets under management on an amortized cost basis, which were up 6% and 4% on a constant currency basis.
Asia sales were up 12% year-over-year on a constant currency basis with growth across most markets.
Latin America, adjusted earnings were down 58% and 57% on a constant currency basis, primarily driven by unfavorable underwriting, partially offset by the improvement in equity markets.
Elevated COVID-19-related claims primarily in Mexico impacted Latin America's adjusted earnings by approximately $150 million after tax.
Latin America adjusted PFOs were down 6% year-over-year on a constant currency basis due to lower single premium immediate annuity sales in Chile.
EMEA adjusted earnings were down 9% and 11% on a constant currency basis, primarily driven by higher COVID-19-related claims as well as higher expenses compared to the favorable prior-year quarter.
EMEA adjusted PFOs were down 5% on a constant currency basis, but sales were up 4% on a constant currency basis due to strong growth in UK employee benefits.
MetLife Holdings adjusted earnings were up 123%.
The life interest adjusted benefit ratio was 54.8%, higher than the prior year quarter of 51% and at the top end of our annual target range of 50% to 55% due to elevated COVID-19 mortality.
Corporate and other adjusted loss was $171 million.
This result is consistent with our 2021 adjusted loss guidance range of $650 million to $750 million.
The Company's effective tax rate on adjusted earnings in the quarter was 20.8% and within our 2021 guidance range of 20% to 22%.
Now, I will provide more detail on Group Benefits 1Q 2021 underwriting performance on page 5.
There were approximately 200,000 COVID-19-related deaths in the US in the first quarter, the highest single quarter since the pandemic began and up nearly 40% versus the fourth quarter of 2020.
In addition to the higher number of claims, there were more deaths at younger ages below 65, which resulted in increased claims severity.
Apart from COVID-19, the number of life insurance claims of greater than $2 million nearly doubled versus a typical quarter.
The Group Life mortality ratio was 106.3% in the first quarter, which included roughly 17 percentage points related to COVID-19 life claims.
This reduced Group Benefits adjusted earnings by approximately $280 million after tax.
For group non-medical health, the interest adjusted benefit ratio was 71.1% in the first quarter with favorable experience across most products.
The 1Q 2021 ratio was below the prior year quarter of 71.7% and at the low end of our annual target range of 70% to 75%.
Now let's turn to VII in the quarter on page 6.
This chart reflects our pre-tax variable investment income over the last five quarters, including approximately $1.4 billion in the first quarter of 2021.
This very strong result was mostly attributable to the private equity portfolio, which had a 13.3% return in the quarter.
While all private equity classes performed well in the quarter, our venture capital funds, which account for roughly 20% of our PE account balance of $10.3 billion were the strongest performer across subsectors with roughly 25% quarterly return due to a broad increase in tech company valuations.
On page 7, first quarter VII of $1.1 billion post-tax is shown by segment.
As noted previously, RIS, MetLife Holdings and Asia generally accounted for approximately 90% or more of the total VII and are split roughly one-third each, although it can vary from quarter to quarter.
Turning to page 8, this chart shows our direct expense ratio over the prior five quarters and full year 2020 including 11% in the first quarter of 2021.
Now, I will discuss our cash and capital position on page 9.
Cash and liquid assets at the holding companies were approximately $3.8 billion at March 31, which is down from $4.5 billion at December 31, but well within our target cash buffer of $3 billion to $4 billion.
The sequential decrease in cash at the holding companies was primarily due to the net effects of subsidiary dividends, payment of our common stock dividend, share repurchases of approximately $1 billion in the first quarter as well as holding company expenses and other cash flows.
For our US companies, our combined NAIC RBC ratio was 392% at year end 2020 and comfortably above our 360% target.
excluding our property and casualty business, preliminary first quarter 2021 statutory operating earnings were approximately $1.5 billion while statutory net income was approximately $570 million.
Statutory operating earnings increased by roughly $2.3 billion year-over-year driven by lower VA rider reserves and increase in interest margins, higher net investment income, and lower operating expenses.
Statutory net income excluding our P&C business increased by roughly $430 million year-over-year, driven by higher operating earnings, partially offset by an increase in after tax derivative losses.
We estimate that our total US statutory adjusted capital excluding P&C was approximately $16.7 billion as of March 31, down 2% compared to December 31.
Finally, the Japan solvency margin ratio was 967% as of December 31, which is the latest public data.

Summary:
By the numbers, we reported first quarter 2021 adjusted earnings of $2 billion or $2.20 per share, up 39% from $1.58 a year ago.
Cash and liquid assets at the holding companies were approximately $3.8 billion at March 31, which is down from $4.5 billion at December 31, but well within our target cash buffer of $3 billion to $4 billion.