The private equity portfolio of $14.9 billion had a plus 1.4% return in the quarter. Real estate equity funds of $2.2 billion had a minus 3% return. As of now, we anticipate PE returns to remain consistent with the second and third quarter with a modest improvement in real estate funds in the fourth quarter. Therefore, VII would more closely resemble second quarter results. On page 7 we provide VII post-tax by segment for the prior five quarters. As we have noted previously each of the businesses hold its own discrete investment portfolios, which have been built to match its liabilities. As reflected in the chart, Asia, RIS and MetLife Holdings continue to hold the largest proportion of VII assets given their long-dated liability profile while Corporate and Other continues to hold higher VII assets than historical levels.
Now turning to page 8. The chart on the left of the page shows the split of our net investment income between recurring and VII for the past three years and Q3 of 2022 versus Q3 of 2023. While VII has had lower than trend returns over the last few quarters, recurring income, which accounts for approximately 96% of net investment income, was up approximately $700 million year-over-year, reflecting higher interest rates and growth in asset balances. Shifting your attention to the right of the page, which shows our new money yield versus roll-off yield over the past three years, new money yields continue to outpace roll-off yields in the recent quarters. In this quarter, our global new money yield continued its upward trajectory coming in at 6.26%, 156 basis points higher than the roll-off yield.
We expect this favorable trend to continue assuming interest rates remain near current levels. Turning to page 9. I’ll provide a few updates on our commercial mortgage loans. First, let me say that we are pleased with the commercial mortgage loan or CML portfolio, which continues to perform as expected. As we have noted last quarter our real estate team updated all US office valuations through June 30, assuming a 25% peak to trough valuation decline. In this quarter, the team shifted its effort to revaluing other CML asset classes, which have not been under the pressure seen in the office sector. Not surprisingly, the average LTV increased only slightly as a result with our CML portfolio now at an average LTV of 63%, up from 62% in the second quarter of 2023 and an average debt service coverage ratio of 2.3 times, which represents no change versus 2Q 2023.
The modest increase in LTVs and stable debt service coverage ratio are further indicators of the disciplined approach we take to investing in this asset class. The quality of our CML portfolio remains strong with only 1.6% of loans having LTVs more than 80% and DSCRs less than one times. With regards to CML loan maturities, we now have successfully resolved almost 90% of the portfolio scheduled to mature in 2023 and our expectation remains for minimal losses on the portfolio. Our CML portfolio scheduled maturities over the next three years are very manageable, 10% in 2024 13% in 2025 and 16% in 2026. Now, let’s switch gears to discuss expenses on page 10. This chart shows a comparison of our direct expense ratio for the full year of 2022 as well as the first three quarters of 2023.
In Q3 of 2023, the ratio was 12.3%. As we have highlighted previously, we believe our full year direct expense ratio is the best way to measure performance due to fluctuations in quarterly results. Our Q3 direct expense ratio benefited from solid top line growth and ongoing expense discipline. While we would expect our direct expense ratio to be higher in Q4 consistent with the seasonality of our business, we are confident we will beat our full year direct expense ratio target of 12.6% in 2023 despite the challenging inflationary environment. We believe this demonstrates our consistent execution and focus on an efficiency mindset. Now let’s turn to page 11. This chart reflects new business value metrics for MetLife’s major segments for the past five years including an update for 2022.
As mentioned by Michel, MetLife invested $3.7 billion of capital in 2022 to support new business. This was deployed at an average unlevered IRR of approximately 17% with a payback period of six years, generating roughly $2.3 billion in value. I will now discuss our cash and capital position on page 12. Cash and liquid assets at the holding companies were approximately $4.9 billion at September 30th, which is above our target cash buffer of $3 billion to $4 billion and higher than our $4.2 billion at June 30th. The cash of the holding companies reflects the net effects of subsidiary dividends, a $1 billion senior debt issuance in July, payment of our common stock dividend, share repurchase of roughly $800 million in the third quarter, as well as holding company expenses and other cash flows.
