<HTML>
<HEAD>
   <TITLE>fourthqtrer10.htm - Generated by SEC Publisher for SEC Filing</TITLE>
</HEAD>

<BODY bgcolor="#ffffff">

<!--$$/page=-->
<A name="page_1"></A><BR>
<a name="_bclPageBorder1"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0 cellPadding=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=center><B><FONT size=5 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">SECURITIES AND EXCHANGE COMMISSION</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Washington, D.C. 20549</FONT></B></TD></TR>
<TR>
     <TD align=center>_______________________</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT size=5 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">FORM 8-K</FONT></B></TD></TR>
<TR height=20>
     <TD align=center><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif"></FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">CURRENT REPORT</FONT></B></TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Pursuant to Section 13 or 15(d) of the</FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD align=center><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Securities Exchange Act of 1934</FONT></B></TD></TR>
<TR height=20>
     <TD align=center><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR vAlign=bottom>
     <TD align=center><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date of Report: </FONT><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">February 7, 2011</FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD align=center><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(Date of earliest event reported)</FONT></TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=center><B><FONT size=5 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">PRINCIPAL FINANCIAL GROUP, INC.</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(Exact name of registrant as specified in its charter)</FONT></TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0 cellPadding=0>
<TR>
     <TD width="34%"></TD>
     <TD width="38%"></TD>
     <TD width="27%"></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 10px" noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Delaware</FONT></B>&nbsp;</TD>
     <TD colSpan=2 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 1-16725</FONT></B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">42-1520346</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(State or other jurisdiction</FONT>&nbsp;</TD>
     <TD colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Commission file number)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(I.R.S. Employer</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;of incorporation)</FONT>&nbsp;</TD>
     <TD colSpan=2 noWrap align=center>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Identification Number)</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=3>&nbsp;</TD></TR>
<TR>
     <TD colSpan=3>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=3 align=center><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">711 High Street, Des Moines, Iowa 50392</FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=3 align=center><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(Address of principal executive offices)</FONT></TD></TR>
<TR>
     <TD colSpan=3>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=3 align=center><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">(515) 247-5111</FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=3 align=center><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(Registrant&#146;s telephone number, including area code)</FONT></TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0 cellPadding=0>
<TR>
     <TD width="5%"></TD>
     <TD width="94%"></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">registrant under any of the following provisions:</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">[&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;]</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">[&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ]</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">[&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ]</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">240.14d-2(b))</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">[&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ]</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">240.13e-4(c))</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=center><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><FONT size=2 face="Times New Roman">_______________________</FONT></FONT></TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>

<!--$$/page=-->
<A name="page_2"></A><BR>
<a name="_bclPageBorder2"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0>
<TR>
     <TD width="50%"></TD>
     <TD width="49%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 2</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif"></FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Item 2.02. Results of Operations and Financial Condition</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">On February 7, 2011, Principal Financial Group, Inc. publicly announced information regarding its</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">results of operations and financial condition for the quarter ended December 31, 2010. The text of</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the announcement is included herewith as Exhibit 99.</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif"></FONT></B></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Item 9.01 Financial Statements and Exhibits</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">99 Fourth Quarter 2010 Earnings Release</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 align=center><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR height=20>
     <TD colSpan=2 align=center><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SIGNATURE</FONT></TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 10px" colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp; Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">caused this report to be signed on its behalf by the undersigned thereunto duly authorized.</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2></TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 61px" colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PRINCIPAL FINANCIAL GROUP, INC.</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;By:</FONT>&nbsp;&nbsp;&nbsp;&nbsp; <FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><U>/s/ Terrance J. Lillis</U></FONT><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 61px" colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Name:&nbsp; Terrance J. Lillis</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 61px" colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title:&nbsp;&nbsp;&nbsp;&nbsp; Senior Vice President and Chief Financial</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Officer</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Date: February <FONT size=3 face="Times New Roman">8</FONT>, 2011</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>

<!--$$/page=-->
<A name="page_3"></A><BR>
<a name="_bclPageBorder3"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0>
<TR>
     <TD width="11%"></TD>
     <TD width="10%"></TD>
     <TD width="61%"></TD>
     <TD width="15%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 3</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=4>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD colSpan=2 noWrap align=left>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">EXHIBIT 99</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">RELEASE</FONT></B><B><I><FONT size=2 face="TimesNewRomanPS-BoldItalicMT,Times New Roman,Times,serif">:</FONT></I></B>&nbsp;</TD>
     <TD colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">On receipt&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">February 2011</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=4 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">MEDIA CONTACT:</FONT></B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Susan Houser, 515-248-2268, houser.susan@principal.com</FONT></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=4 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">INVESTOR CONTACT</FONT></B><I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">:</FONT></I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">John Egan 515-235-9500, egan.john@principal.com</FONT></TD></TR>
<TR>
     <TD colSpan=4>&nbsp;</TD></TR>
<TR>
     <TD colSpan=4>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=4 noWrap align=left><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Principal Financial Group, Inc. Announces Full Year</FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=4 noWrap align=left><B><FONT size=3 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; and Fourth Quarter 2010 Results</FONT></B></TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<UL>
<LI><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Full-year 2010 operating earnings</FONT></B><B><SUP><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">1 </FONT></SUP></B><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">of $844.8 million, an increase of 15 percent over 2009;</FONT></B> <B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">net income available to common stockholders of $666.3 million, an increase of 13 percent</FONT></B> <B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">over 2009.</FONT></B>
<LI><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Fourth quarter 2010 operating earnings of $214.1 million, an increase of 5 percent over</FONT></B> <B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">fourth quarter 2009; net income available to common stockholders of $199.3 million, an</FONT></B> <B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">increase of 40 percent over fourth quarter 2009.</FONT></B>
<LI><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Year-end 2010 record assets under management of $318.8 billion, an increase of 12 percent</FONT></B> <B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">compared to year-end 2009.</FONT></B> </LI></UL>
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0 cellPadding=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(Des Moines, Iowa) &#150; Principal Financial Group, Inc. (NYSE: PFG) today announced results for full-year and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">fourth quarter 2010. The company reported operating earnings of $844.8 million for the twelve months ended</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Dec. 31, 2010, compared to $733.3 million for the twelve months ended Dec. 31, 2009. Operating earnings per</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">diluted share (EPS) were $2.62 for the twelve months ended Dec. 31, 2010, compared to $2.45 for the twelve</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">months ended Dec. 31, 2009. The company reported net income available to common stockholders of $666.3</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">million, or $2.06 per diluted share for the twelve months ended Dec. 31, 2010, compared to $589.7 million, or</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$1.97 per diluted share for the twelve months ended Dec. 31, 2009. Operating revenues for the year 2010 were</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$8,041.9 million compared to $7,712.2 million for the same period last year.</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 15px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp; The company reported operating earnings of $214.1 million for the three months ended Dec. 31, 2010,</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">compared to $203.9 million for the three months ended Dec. 31, 2009. Operating earnings per diluted share</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(EPS) were $0.66 for the three months ended Dec. 31, 2010, compared to $0.63 for the three months ended Dec.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">31, 2009. The company reported net income available to common stockholders of $199.3 million, or $0.62 per</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">diluted share for the three months ended Dec. 31, 2010, compared to $141.9 million, or $0.44 per diluted share</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">for the three months ended Dec. 31, 2009. Operating revenues for the fourth quarter 2010 were $2,106.5 million</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">compared to $1,983.6 million for the same period last year.</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 17px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp; &#147;The Principal</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#174; </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">finished the year strong with all-time record assets under management and an</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">increase in operating earnings. Strong sales in Full Service Accumulation and Principal Funds paired with</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">record net cash flow in Principal International demonstrate the growth we&#146;re seeing across our businesses,&#148;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">said Larry D. Zimpleman, chairman, president and chief executive officer of Principal Financial Group, Inc.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#147;Throughout 2010, we continued to be well-served by our hybrid business model and purposeful</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">diversification. The potential of our long-term strategies will help us capitalize on unprecedented growth</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">opportunities in 2011 and beyond.&#148;</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD></TD></TR>
<TR>
     <TD>&nbsp;_______________________</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">1 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Use of non-GAAP financial measures is discussed in this release after Segment Highlights</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>

<!--$$/page=-->
<A name="page_4"></A><BR>
<a name="_bclPageBorder4"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0>
<TR>
     <TD width="7%"></TD>
     <TD width="92%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 4</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 7px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#147;As the economic recovery takes hold, we continue to see momentum build in our businesses,&#148; said</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Terry Lillis, senior vice president and chief financial officer. &#147;Compared to 2009, we kept operating expenses</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">relatively flat on 14 percent growth in average assets under management, reflecting our ongoing expense discipline</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and operating leverage. Our investment portfolio performed better than expected in 2010 with improving trends</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">throughout the year, and we remain in a very strong financial position as we move forward.&#148;</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Key Highlights</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Year End</FONT></I>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT>&nbsp;</P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Principal International reported record assets under management of $45.8 billion as of Dec. 31, 2010, and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">record net cash flow of $4.7 billion for the year.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Record net cash flow in Principal Funds of $1.6 billion for 2010.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="SymbolMT,Times New Roman,Times,serif">
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</FONT></TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Continued strong operating leverage in Principal Global Investors with 53 percent growth in full-year</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2010 operating earnings over full-year 2009 compared to 6 percent growth in average assets under</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">management.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="SymbolMT,Times New Roman,Times,serif">
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</FONT></TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Strong capital position with an estimated risk based capital ratio of 420 percent at year end and $1.6 billion</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of excess capital.</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2</FONT></SUP>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Fourth Quarter</FONT></I>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Third highest cumulative sales quarter of the company&#146;s three key U.S. Retirement and Investor Services</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">products in the fourth quarter, with $3.2 billion for Full Service Accumulation, $2.6 billion for Principal</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Funds and $306 million for Individual Annuities.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="SymbolMT,Times New Roman,Times,serif">
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</FONT></TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Book value per share, excluding AOCI</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">increased to a record high of $27.82, up 6 percent over fourth</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">quarter 2009.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT>&nbsp;</P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Paid an annual dividend of $0.55 per common share during the quarter, a 10 percent increase over 2009.</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Net Income</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Year End</FONT></I>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Net income available to common stockholders of $666.3 million for the twelve months ended Dec. 31, 2010</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reflects net realized capital losses of $194.2 million, which include:</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$148.9 million of losses related to credit gains and losses on sales and permanent impairments of fixed</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">maturity securities, including $114.3 million of losses on commercial mortgage backed securities;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT>&nbsp;</P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$72.1 million of gains recognized in the second quarter 2010 from a change in the company&#146;s economic</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">interest in the Brasilprev joint venture;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp;&nbsp;&#149;</FONT></P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$64.4 million of losses and provisions on residential mortgage loans, primarily related to Principal Bank&#146;s</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">home equity portfolio; and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$34.5 million of losses on commercial mortgage whole loans.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Net income also reflects $48.5 million of one-time after-tax losses during the third quarter 2010 from planned</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">severance and goodwill write-off as a result of the company&#146;s decision to exit the medical insurance business.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><I><FONT size=2 face="TimesNewRomanPS-ItalicMT,Times New Roman,Times,serif">Fourth Quarter</FONT></I>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Net income available to common stockholders of $199.3 million for the three months ended Dec. 31, 2010</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">reflects net realized capital losses of $37.3 million, which include:</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$33.5 million of losses related to credit gains and losses on sales and permanent impairments of fixed</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">maturity securities, including $24.6 million of losses on commercial mortgage backed securities;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="SymbolMT,Times New Roman,Times,serif">
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</FONT></TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$5.9 million of losses on commercial mortgage whole loans;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT></P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$9.7 million of losses on residential mortgage loans; and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left>
<P></P>
<P style="MARGIN: 0in 0in 0pt"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT>&nbsp;</P>
</TD>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$5.7 million of losses from fixed maturities designated as trading.</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>_______________________&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">2 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Excess capital includes cash at the holding company and capital at the life company above that needed to maintain a</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">350 percent NAIC risk based capital ratio for the life company.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">3 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Accumulated Other Comprehensive Income</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>

<!--$$/page=-->
<A name="page_5"></A><BR>
<a name="_bclPageBorder5"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 5</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><I><FONT size=2 face="TimesNewRomanPS-BoldItalicMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment Highlights</FONT></I></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Retirement and Investor Services</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 18px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment operating earnings for fourth quarter 2010 were $151.0 million, compared to $125.3 million</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">for the same period in 2009, as every line of business within the segment saw a double-digit percentage increase.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Full Service Accumulation earnings increased 13 percent from the year ago quarter to $76.0 million, reflecting a</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">10 percent increase in average account values. Principal Funds earnings increased 24 percent from a year ago to</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$10.5 million, primarily due to a 15 percent increase in average account values. Individual Annuities earnings</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">were $33.2 million compared to $24.2 million for fourth quarter 2009. The variance primarily reflects favorable</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">investment performance in the quarter, including higher asset prepayment fee income. The accumulation</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">businesses</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">4 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">had record account values of $159.6 billion at year end.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 17px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating revenues for the fourth quarter 2010 were $1,093.4 million compared to $1,017.1 million</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">for the same period in 2009 primarily due to higher revenues for the accumulation businesses, which</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">improved $51.5 million, or 8 percent from a year ago.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 17px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment assets under management were $175.0 billion as of Dec. 31, 2010, compared to $159.8</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">billion as of Dec. 31, 2009, despite a $3.3 billion decrease in Investment Only account values.</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Principal Global Investors</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 15px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment operating earnings for fourth quarter 2010 were $19.2 million, compared to $12.7 million in</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the prior year quarter, primarily due to increased transaction fees and an increase in assets under management.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 15px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating revenues for fourth quarter were $135.3 million, compared to $120.4 million for the same</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">period in 2009, primarily due to higher management fees and an increase in transaction fees.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 15px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unaffiliated assets under management were $78.8 billion as of Dec. 31, 2010, compared to $73.8</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">billion as of Dec. 31, 2009.</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif"></FONT></B></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Principal International</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 18px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment operating earnings were $30.9 million in fourth quarter 2010, compared to $39.5 million in</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">the prior year quarter as the current quarter, reflecting our reduced economic interest in the Brazilian joint</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">venture.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 18px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating revenues were $210.5 million for fourth quarter 2010, compared to $180.3 million for the</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">same period last year, primarily due to 32 percent growth in assets under management.</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>________________________</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><SUP><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">4 </FONT></SUP></B><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Full Service Accumulation, Principal Funds, Individual Annuities and Bank and Trust Services</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>

<!--$$/page=-->
<A name="page_6"></A><BR>
<a name="_bclPageBorder6"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 6</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 18px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment assets under management were a record $45.8 billion as of Dec. 31, 2010 (excluding</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">approximately $6.9 billion of assets under management in our asset management joint venture in China,</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">which are not included in reported assets under management), up $11.2 billion over $34.6 billion as of Dec.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">31, 2009. This includes a record $4.7 billion of net cash flows over the trailing twelve months, or 14 percent</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of beginning of period assets under management.</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">U.S. Insurance Solutions</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 18px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment operating earnings for fourth quarter 2010 were $52.3 million, compared to $56.0 million</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">for the same period in 2009. Specialty Benefits earnings were $30.2 million in fourth quarter 2010, up from</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">$25.5 million in the same period a year ago, primarily due to favorable claims experience and improved</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">investment performance. Individual Life earnings were $22.1 million in the fourth quarter, compared to $30.5</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">million in fourth quarter 2009, primarily due to an increase in GAAP net reserves in Individual Life following a</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">periodic long-term interest rate assumption review.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 18px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Segment operating revenues for fourth quarter were flat compared to the year ago quarter, with</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">stronger retail insurance sales and continued recovery in employer-sponsored benefit programs in the second</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">half of 2010.</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Corporate</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 18px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating losses for fourth quarter 2010 were $39.3 million compared to operating losses of $29.6</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">million in fourth quarter 2009. The difference reflects a favorable settlement reserve release in the year ago quarter</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and higher expenses in fourth quarter 2010.</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"></FONT></TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">_<FONT size=2 face="Times New Roman">______________________</FONT></FONT></TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>


<A name="page_7"></A><BR>
<a name="_bclPageBorder7"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0>
<TR>
     <TD width="7%"></TD>
     <TD width="92%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 7</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Forward looking and cautionary statements</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">This press release contains forward-looking statements, including, without limitation, statements as to</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">operating earnings, net income available to common stockholders, net cash flows, realized and unrealized</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">gains and losses, capital and liquidity positions, sales and earnings trends, and management's beliefs,</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">expectations, goals and opinions. The company does not undertake to update these statements, which are</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">based on a number of assumptions concerning future conditions that may ultimately prove to be inaccurate.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Future events and their effects on the company may not be those anticipated, and actual results may differ</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">materially from the results anticipated in these forward-looking statements. The risks, uncertainties and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">factors that could cause or contribute to such material differences are discussed in the company's annual report</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">on Form 10-K for the year ended Dec. 31, 2009, and in the company&#146;s quarterly report on Form 10-Q for the</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">quarter ended Sept. 30, 2010, filed by the company with the Securities and Exchange Commission, as updated</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">or supplemented from time to time in subsequent filings. These risks and uncertainties include, without</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">limitation: adverse capital and credit market conditions that may significantly affect the company&#146;s ability to</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">meet liquidity needs, access to capital and cost of capital; a continuation of difficult conditions in the global</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">capital markets and the general economy that may materially adversely affect the company&#146;s business and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">results of operations; the actions of the U.S. government, Federal Reserve and other governmental and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">regulatory bodies for purposes of stabilizing the financial markets might not achieve the intended effect; the</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">risk from acquiring new businesses, which could result in the impairment of goodwill and/or intangible assets</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">recognized at the time of acquisition; impairment of other financial institutions that could adversely affect the</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">company; investment risks which may diminish the value of the company&#146;s invested assets and the investment</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">returns credited to customers, which could reduce sales, revenues, assets under management and net income;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">requirements to post collateral or make payments related to declines in market value of specified assets may</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">adversely affect company liquidity and expose the company to counterparty credit risk; changes in laws,</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">regulations or accounting standards that may reduce</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">company profitability; fluctuations in foreign </FONT></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">currency exchange rates that could reduce company</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">profitability; Principal Financial Group, Inc.&#146;s </FONT></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">primary reliance, as a holding company, on dividends from its</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">subsidiaries to meet debt payment obligations </FONT></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and regulatory restrictions on the ability of subsidiaries to pay</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">such dividends; competitive factors; volatility </FONT></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of financial markets; decrease in ratings; interest rate changes;</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">inability to attract and retain sales representatives; </FONT></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">international business risks; a pandemic, terrorist attack or</FONT>&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">other catastrophic event; and default of the company&#146;s re-insurers.</FONT></TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Use of Non-GAAP Financial Measures</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">The company uses a number of non-GAAP financial measures that management believes are useful to investors</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">because they illustrate the performance of normal, ongoing operations, which is important in understanding and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">evaluating the company&#146;s financial condition and results of operations. They are not, however, a substitute for</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">U.S. GAAP financial measures. Therefore, the company has provided reconciliations of the non-GAAP</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">measures to the most directly comparable U.S. GAAP measure at the end of the release. The company adjusts</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">U.S. GAAP measures for items not directly related to ongoing operations. However, it is possible these</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">adjusting items have occurred in the past and could recur in the future reporting periods. Management also uses</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">non-GAAP measures for goal setting, as a basis for determining employee and senior management</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">awards and compensation, and evaluating performance on a basis comparable to that used by investors</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and securities analysts.</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">Earnings Conference Call</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">On Tuesday, Feb. 8, 2011 at 10:00 a.m. (ET), Chairman, President and Chief Executive Officer Larry</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Zimpleman and Senior Vice President and Chief Financial Officer Terry Lillis will lead a discussion of</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 5px" colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">results, asset quality and capital adequacy during a live conference call, which can be accessed as follows:</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=2 face="SymbolMT,Times New Roman,Times,serif">
<P></P>
<P></P>
<FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT>&nbsp;&nbsp;&nbsp; </FONT><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Via live Internet webcast. Please go to </FONT><FONT color=#000000 size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">www.principal.com/investor </FONT><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><FONT color=#000000>at </FONT>least 10-15 minutes prior to the</FONT>&nbsp; </TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">start of the call to register, and to download and install any necessary audio software.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><FONT style="FONT-SIZE: 12pt" lang=EN-US face="Times New Roman">&nbsp; &#149;</FONT>&nbsp;&nbsp;&nbsp;&nbsp; Via telephone by dialing 800-374-1609 (U.S. and Canadian callers) or 706-643-7701 (International</FONT>&nbsp; </TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">callers) approximately 10 minutes prior to the start of the call. The access code is 34798317.</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>


<A name="page_8"></A><BR>
<a name="_bclPageBorder8"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 8</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD vAlign=top width="2%" noWrap>
<LI></LI></TD>
     <TD width="98%" colSpan=2><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Replay of the earnings call via telephone is available by dialing 800-642-1687 (U.S. and Canadian</FONT> </TD></TR>
<TR>
     <TD width="2%">&nbsp;</TD>
     <TD width="98%" colSpan=2><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">callers)</FONT> <FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">or 706-645-9291 (International callers). The access code is 34798317. This replay will be</FONT> </TD></TR>
<TR>
     <TD width="2%">&nbsp;</TD>
     <TD width="98%" colSpan=2><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">available</FONT> <FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">approximately two hours after the completion of the live earnings call through the end of day</FONT> </TD></TR>
<TR>
     <TD width="2%">&nbsp;</TD>
     <TD width="98%" colSpan=2><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Feb.</FONT> <FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">15, 2011.</FONT> </TD></TR>
<TR>
     <TD vAlign=top width="2%" noWrap>
<LI></LI></TD>
     <TD width="98%" colSpan=2><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Replay of the earnings call via webcast as well as a transcript of the call will be available after the call at:</FONT> </TD></TR>
<TR>
     <TD width="2%">&nbsp;</TD>
     <TD width="98%" colSpan=2><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif"><FONT color=#000000 size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">www.principal.com/investor.<FONT size=2 face="Times New Roman"></FONT></FONT></FONT></TD></TR></TABLE>
<DIV align=left>
<TABLE border=0 cellSpacing=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">The company's financial supplement and additional investment portfolio detail for fourth quarter 2010 is</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">currently available at </FONT><FONT color=#000000 size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">www.principal.com/investor</FONT><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">, and may be referred to during the call.</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">About the Principal Financial Group</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">The Principal Financial Group<SUP>&#174;</SUP></FONT><FONT size=1 face="SymbolMT,Times New Roman,Times,serif"> </FONT><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">(The Principal </FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#174; </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">)</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">is a leader in offering businesses, individuals and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">institutional clients a wide range of financial products and services, including retirement and investment</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">services, insurance, and banking through its diverse family of financial services companies. A member of the</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Fortune 500, the Principal Financial Group has $318.8 billion in assets under management</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">6 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and serves some</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">19.1 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">PFG. For more information, visi<FONT size=2 face="Times New Roman">t www.principal.com</FONT></FONT><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">.</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD align=center><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">###</FONT></TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD></TR>
<TR>
     <TD>_______________________&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">5 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#147;The Principal Financial Group</FONT><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">&#148; </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and &#147;The Principal&#148; are registered service marks of Principal Financial Services,</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Inc., a member of the Principal Financial Group.</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">6 </FONT></SUP><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">As of Dec. 31, 2010</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>

<!--$$/page=-->
<A name="page_9"></A><BR>
<a name="_bclPageBorder9"></a><DIV style="PADDING-LEFT: 17%; WIDTH: 100%; PADDING-RIGHT: 17%">
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=3 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Page 9</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><I><FONT size=2 face="TimesNewRomanPS-BoldItalicMT,Times New Roman,Times,serif">Summary of Segment and Principal Financial Group, Inc. Results</FONT></I></B>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
<IMG border=0 src="fourthqtrer10x9x1.jpg">
<BR>
<DIV align=left>
<TABLE style="WIDTH: 80%" border=0 cellSpacing=0 cellPadding=0>
<TR>
     <TD width="100%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=2 face="TimesNewRomanPS-BoldMT,Times New Roman,Times,serif">*Operating earnings versus U.S. GAAP (GAAP) net income available to common stockholders</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">Management uses operating earnings, which excludes the effect of net realized capital gains and losses, as adjusted, and other after-</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">tax adjustments, for goal setting, as a basis for determining employee compensation, and evaluating performance on a basis</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">comparable to that used by investors and securities analysts. Segment operating earnings are determined by adjusting U.S. GAAP net</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">income available to common stockholders for net realized capital gains and losses, as adjusted, and other after-tax adjustments the</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">company believes are not indicative of overall operating trends. Note: it is possible these adjusting items have occurred in the past</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">and could recur in future reporting periods. While these items may be significant components in understanding and assessing our</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">consolidated financial performance, management believes the presentation of segment operating earnings enhances the understanding</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face="TimesNewRomanPSMT,Times New Roman,Times,serif">of results of operations by highlighting earnings attributable to the normal, ongoing operations of the company&#146;s businesses.</FONT>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN: 0px">&nbsp;</P>
</DIV>
<HR align=center SIZE=2 width="100%" noShade>


<!--$$/page=-->
<A name="page_10"></A><BR>

<a name="_bclPageBorder10"></a><DIV STYLE="WIDTH: 100%; PADDING-RIGHT: 17%; PADDING-LEFT: 17%">
<IMG src="fourthqtrer10x10x1.jpg" border=0>
<BR>
</DIV>

<HR noshade align="center" width="100%" size=2>



<!--$$/page=-->
<A name="page_11"></A><BR>

<a name="_bclPageBorder11"></a><DIV STYLE="WIDTH: 100%; PADDING-RIGHT: 17%; PADDING-LEFT: 17%">
<IMG src="fourthqtrer10x11x1.jpg" border=0>
<BR>
</DIV>

<HR noshade align="center" width="100%" size=2>


</BODY>

</HTML>
[{"type": "8-K", "sequence": "1", "filename": "fourthqtrer10.htm", "description": "FOURTH QUARTER EARNINGS RELEASE 8-K", "secsgml_size_bytes": 83114}]
{"company-data": {"conformed-name": "PRINCIPAL FINANCIAL GROUP INC", "cik": "0001126328", "assigned-sic": "6321", "irs-number": "421520346", "state-of-incorporation": "DE", "fiscal-year-end": "0224"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-16725", "film-number": "11580423"}, "business-address": {"street1": "711 HIGH STREET", "city": "DES MOINES", "state": "IA", "zip": "50392-0300", "phone": "5152475111"}, "mail-address": {"street1": "711 HIGH STREET", "city": "DES MOINES", "state": "IA", "zip": "50392-0300"}}
fourthqtrer10.htm - Generated by SEC Publisher for SEC Filing
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report:
February 7, 2011
(Date of earliest event reported)
PRINCIPAL FINANCIAL GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware
1-16725
42-1520346
(State or other jurisdiction
(Commission file number)
(I.R.S. Employer
of incorporation)
Identification Number)
711 High Street, Des Moines, Iowa 50392
(Address of principal executive offices)
(515) 247-5111
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions:
[      ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[      ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[      ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
[      ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
_______________________
Page 2
Item 2.02. Results of Operations and Financial Condition
On February 7, 2011, Principal Financial Group, Inc. publicly announced information regarding its
results of operations and financial condition for the quarter ended December 31, 2010. The text of
the announcement is included herewith as Exhibit 99.
Item 9.01 Financial Statements and Exhibits
99 Fourth Quarter 2010 Earnings Release
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
PRINCIPAL FINANCIAL GROUP, INC.
By:
/s/ Terrance J. Lillis
Name:  Terrance J. Lillis
Title:     Senior Vice President and Chief Financial
Officer
Date: February
8
, 2011
Page 3
EXHIBIT 99
RELEASE
:
On receipt
February 2011
MEDIA CONTACT:
Susan Houser, 515-248-2268, houser.susan@principal.com
INVESTOR CONTACT
:
John Egan 515-235-9500, egan.john@principal.com
Principal Financial Group, Inc. Announces Full Year
and Fourth Quarter 2010 Results
Full-year 2010 operating earnings
1
of $844.8 million, an increase of 15 percent over 2009;
net income available to common stockholders of $666.3 million, an increase of 13 percent
over 2009.
Fourth quarter 2010 operating earnings of $214.1 million, an increase of 5 percent over
fourth quarter 2009; net income available to common stockholders of $199.3 million, an
increase of 40 percent over fourth quarter 2009.
Year-end 2010 record assets under management of $318.8 billion, an increase of 12 percent
compared to year-end 2009.
(Des Moines, Iowa) – Principal Financial Group, Inc. (NYSE: PFG) today announced results for full-year and
fourth quarter 2010. The company reported operating earnings of $844.8 million for the twelve months ended
Dec. 31, 2010, compared to $733.3 million for the twelve months ended Dec. 31, 2009. Operating earnings per
diluted share (EPS) were $2.62 for the twelve months ended Dec. 31, 2010, compared to $2.45 for the twelve
months ended Dec. 31, 2009. The company reported net income available to common stockholders of $666.3
million, or $2.06 per diluted share for the twelve months ended Dec. 31, 2010, compared to $589.7 million, or
$1.97 per diluted share for the twelve months ended Dec. 31, 2009. Operating revenues for the year 2010 were
$8,041.9 million compared to $7,712.2 million for the same period last year.
The company reported operating earnings of $214.1 million for the three months ended Dec. 31, 2010,
compared to $203.9 million for the three months ended Dec. 31, 2009. Operating earnings per diluted share
(EPS) were $0.66 for the three months ended Dec. 31, 2010, compared to $0.63 for the three months ended Dec.
31, 2009. The company reported net income available to common stockholders of $199.3 million, or $0.62 per
diluted share for the three months ended Dec. 31, 2010, compared to $141.9 million, or $0.44 per diluted share
for the three months ended Dec. 31, 2009. Operating revenues for the fourth quarter 2010 were $2,106.5 million
compared to $1,983.6 million for the same period last year.
"The Principal
®
finished the year strong with all-time record assets under management and an
increase in operating earnings. Strong sales in Full Service Accumulation and Principal Funds paired with
record net cash flow in Principal International demonstrate the growth we're seeing across our businesses,"
said Larry D. Zimpleman, chairman, president and chief executive officer of Principal Financial Group, Inc.
"Throughout 2010, we continued to be well-served by our hybrid business model and purposeful
diversification. The potential of our long-term strategies will help us capitalize on unprecedented growth
opportunities in 2011 and beyond."
_______________________
1
Use of non-GAAP financial measures is discussed in this release after Segment Highlights
Page 4
"As the economic recovery takes hold, we continue to see momentum build in our businesses," said
Terry Lillis, senior vice president and chief financial officer. "Compared to 2009, we kept operating expenses
relatively flat on 14 percent growth in average assets under management, reflecting our ongoing expense discipline
and operating leverage. Our investment portfolio performed better than expected in 2010 with improving trends
throughout the year, and we remain in a very strong financial position as we move forward."
Key Highlights
Year End
•
Principal International reported record assets under management of $45.8 billion as of Dec. 31, 2010, and
record net cash flow of $4.7 billion for the year.
•
Record net cash flow in Principal Funds of $1.6 billion for 2010.
•
Continued strong operating leverage in Principal Global Investors with 53 percent growth in full-year
2010 operating earnings over full-year 2009 compared to 6 percent growth in average assets under
management.
•
Strong capital position with an estimated risk based capital ratio of 420 percent at year end and $1.6 billion
of excess capital.
2
Fourth Quarter
•
Third highest cumulative sales quarter of the company's three key U.S. Retirement and Investor Services
products in the fourth quarter, with $3.2 billion for Full Service Accumulation, $2.6 billion for Principal
Funds and $306 million for Individual Annuities.
•
Book value per share, excluding AOCI
3
increased to a record high of $27.82, up 6 percent over fourth
quarter 2009.
•
Paid an annual dividend of $0.55 per common share during the quarter, a 10 percent increase over 2009.
Net Income
Year End
Net income available to common stockholders of $666.3 million for the twelve months ended Dec. 31, 2010
reflects net realized capital losses of $194.2 million, which include:
•
$148.9 million of losses related to credit gains and losses on sales and permanent impairments of fixed
maturity securities, including $114.3 million of losses on commercial mortgage backed securities;
•
$72.1 million of gains recognized in the second quarter 2010 from a change in the company's economic
interest in the Brasilprev joint venture;
•
$64.4 million of losses and provisions on residential mortgage loans, primarily related to Principal Bank's
home equity portfolio; and
•
$34.5 million of losses on commercial mortgage whole loans.
Net income also reflects $48.5 million of one-time after-tax losses during the third quarter 2010 from planned
severance and goodwill write-off as a result of the company's decision to exit the medical insurance business.
Fourth Quarter
Net income available to common stockholders of $199.3 million for the three months ended Dec. 31, 2010
reflects net realized capital losses of $37.3 million, which include:
•
$33.5 million of losses related to credit gains and losses on sales and permanent impairments of fixed
maturity securities, including $24.6 million of losses on commercial mortgage backed securities;
•
$5.9 million of losses on commercial mortgage whole loans;
•
$9.7 million of losses on residential mortgage loans; and
•
$5.7 million of losses from fixed maturities designated as trading.
_______________________
2
Excess capital includes cash at the holding company and capital at the life company above that needed to maintain a
350 percent NAIC risk based capital ratio for the life company.
3
Accumulated Other Comprehensive Income
Page 5
Segment Highlights
Retirement and Investor Services
Segment operating earnings for fourth quarter 2010 were $151.0 million, compared to $125.3 million
for the same period in 2009, as every line of business within the segment saw a double-digit percentage increase.
Full Service Accumulation earnings increased 13 percent from the year ago quarter to $76.0 million, reflecting a
10 percent increase in average account values. Principal Funds earnings increased 24 percent from a year ago to
$10.5 million, primarily due to a 15 percent increase in average account values. Individual Annuities earnings
were $33.2 million compared to $24.2 million for fourth quarter 2009. The variance primarily reflects favorable
investment performance in the quarter, including higher asset prepayment fee income. The accumulation
businesses
4
had record account values of $159.6 billion at year end.
Operating revenues for the fourth quarter 2010 were $1,093.4 million compared to $1,017.1 million
for the same period in 2009 primarily due to higher revenues for the accumulation businesses, which
improved $51.5 million, or 8 percent from a year ago.
Segment assets under management were $175.0 billion as of Dec. 31, 2010, compared to $159.8
billion as of Dec. 31, 2009, despite a $3.3 billion decrease in Investment Only account values.
Principal Global Investors
Segment operating earnings for fourth quarter 2010 were $19.2 million, compared to $12.7 million in
the prior year quarter, primarily due to increased transaction fees and an increase in assets under management.
Operating revenues for fourth quarter were $135.3 million, compared to $120.4 million for the same
period in 2009, primarily due to higher management fees and an increase in transaction fees.
Unaffiliated assets under management were $78.8 billion as of Dec. 31, 2010, compared to $73.8
billion as of Dec. 31, 2009.
Principal International
Segment operating earnings were $30.9 million in fourth quarter 2010, compared to $39.5 million in
the prior year quarter as the current quarter, reflecting our reduced economic interest in the Brazilian joint
venture.
Operating revenues were $210.5 million for fourth quarter 2010, compared to $180.3 million for the
same period last year, primarily due to 32 percent growth in assets under management.
________________________
4
Full Service Accumulation, Principal Funds, Individual Annuities and Bank and Trust Services
Page 6
Segment assets under management were a record $45.8 billion as of Dec. 31, 2010 (excluding
approximately $6.9 billion of assets under management in our asset management joint venture in China,
which are not included in reported assets under management), up $11.2 billion over $34.6 billion as of Dec.
31, 2009. This includes a record $4.7 billion of net cash flows over the trailing twelve months, or 14 percent
of beginning of period assets under management.
U.S. Insurance Solutions
Segment operating earnings for fourth quarter 2010 were $52.3 million, compared to $56.0 million
for the same period in 2009. Specialty Benefits earnings were $30.2 million in fourth quarter 2010, up from
$25.5 million in the same period a year ago, primarily due to favorable claims experience and improved
investment performance. Individual Life earnings were $22.1 million in the fourth quarter, compared to $30.5
million in fourth quarter 2009, primarily due to an increase in GAAP net reserves in Individual Life following a
periodic long-term interest rate assumption review.
Segment operating revenues for fourth quarter were flat compared to the year ago quarter, with
stronger retail insurance sales and continued recovery in employer-sponsored benefit programs in the second
half of 2010.
Corporate
Operating losses for fourth quarter 2010 were $39.3 million compared to operating losses of $29.6
million in fourth quarter 2009. The difference reflects a favorable settlement reserve release in the year ago quarter
and higher expenses in fourth quarter 2010.
_
______________________
Page 7
Forward looking and cautionary statements
This press release contains forward-looking statements, including, without limitation, statements as to
operating earnings, net income available to common stockholders, net cash flows, realized and unrealized
gains and losses, capital and liquidity positions, sales and earnings trends, and management's beliefs,
expectations, goals and opinions. The company does not undertake to update these statements, which are
based on a number of assumptions concerning future conditions that may ultimately prove to be inaccurate.
Future events and their effects on the company may not be those anticipated, and actual results may differ
materially from the results anticipated in these forward-looking statements. The risks, uncertainties and
factors that could cause or contribute to such material differences are discussed in the company's annual report
on Form 10-K for the year ended Dec. 31, 2009, and in the company's quarterly report on Form 10-Q for the
quarter ended Sept. 30, 2010, filed by the company with the Securities and Exchange Commission, as updated
or supplemented from time to time in subsequent filings. These risks and uncertainties include, without
limitation: adverse capital and credit market conditions that may significantly affect the company's ability to
meet liquidity needs, access to capital and cost of capital; a continuation of difficult conditions in the global
capital markets and the general economy that may materially adversely affect the company's business and
results of operations; the actions of the U.S. government, Federal Reserve and other governmental and
regulatory bodies for purposes of stabilizing the financial markets might not achieve the intended effect; the
risk from acquiring new businesses, which could result in the impairment of goodwill and/or intangible assets
recognized at the time of acquisition; impairment of other financial institutions that could adversely affect the
company; investment risks which may diminish the value of the company's invested assets and the investment
returns credited to customers, which could reduce sales, revenues, assets under management and net income;
requirements to post collateral or make payments related to declines in market value of specified assets may
adversely affect company liquidity and expose the company to counterparty credit risk; changes in laws,
regulations or accounting standards that may reduce
company profitability; fluctuations in foreign
currency exchange rates that could reduce company
profitability; Principal Financial Group, Inc.'s
primary reliance, as a holding company, on dividends from its
subsidiaries to meet debt payment obligations
and regulatory restrictions on the ability of subsidiaries to pay
such dividends; competitive factors; volatility
of financial markets; decrease in ratings; interest rate changes;
inability to attract and retain sales representatives;
international business risks; a pandemic, terrorist attack or
other catastrophic event; and default of the company's re-insurers.
Use of Non-GAAP Financial Measures
The company uses a number of non-GAAP financial measures that management believes are useful to investors
because they illustrate the performance of normal, ongoing operations, which is important in understanding and
evaluating the company's financial condition and results of operations. They are not, however, a substitute for
U.S. GAAP financial measures. Therefore, the company has provided reconciliations of the non-GAAP
measures to the most directly comparable U.S. GAAP measure at the end of the release. The company adjusts
U.S. GAAP measures for items not directly related to ongoing operations. However, it is possible these
adjusting items have occurred in the past and could recur in the future reporting periods. Management also uses
non-GAAP measures for goal setting, as a basis for determining employee and senior management
awards and compensation, and evaluating performance on a basis comparable to that used by investors
and securities analysts.
Earnings Conference Call
On Tuesday, Feb. 8, 2011 at 10:00 a.m. (ET), Chairman, President and Chief Executive Officer Larry
Zimpleman and Senior Vice President and Chief Financial Officer Terry Lillis will lead a discussion of
results, asset quality and capital adequacy during a live conference call, which can be accessed as follows:
•
Via live Internet webcast. Please go to
www.principal.com/investor
at
least 10-15 minutes prior to the
start of the call to register, and to download and install any necessary audio software.
•
Via telephone by dialing 800-374-1609 (U.S. and Canadian callers) or 706-643-7701 (International
callers) approximately 10 minutes prior to the start of the call. The access code is 34798317.
Page 8
Replay of the earnings call via telephone is available by dialing 800-642-1687 (U.S. and Canadian
callers)
or 706-645-9291 (International callers). The access code is 34798317. This replay will be
available
approximately two hours after the completion of the live earnings call through the end of day
Feb.
15, 2011.
Replay of the earnings call via webcast as well as a transcript of the call will be available after the call at:
www.principal.com/investor.
The company's financial supplement and additional investment portfolio detail for fourth quarter 2010 is
currently available at
www.principal.com/investor
, and may be referred to during the call.
About the Principal Financial Group
The Principal Financial Group
®
(The Principal
®
)
5
is a leader in offering businesses, individuals and
institutional clients a wide range of financial products and services, including retirement and investment
services, insurance, and banking through its diverse family of financial services companies. A member of the
Fortune 500, the Principal Financial Group has $318.8 billion in assets under management
6
and serves some
19.1 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United
States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol
PFG. For more information, visi
t www.principal.com
.
###
_______________________
5
"The Principal Financial Group
"
and "The Principal" are registered service marks of Principal Financial Services,
Inc., a member of the Principal Financial Group.
6
As of Dec. 31, 2010
Page 9
Summary of Segment and Principal Financial Group, Inc. Results
*Operating earnings versus U.S. GAAP (GAAP) net income available to common stockholders
Management uses operating earnings, which excludes the effect of net realized capital gains and losses, as adjusted, and other after-
tax adjustments, for goal setting, as a basis for determining employee compensation, and evaluating performance on a basis
comparable to that used by investors and securities analysts. Segment operating earnings are determined by adjusting U.S. GAAP net
income available to common stockholders for net realized capital gains and losses, as adjusted, and other after-tax adjustments the
company believes are not indicative of overall operating trends. Note: it is possible these adjusting items have occurred in the past
and could recur in future reporting periods. While these items may be significant components in understanding and assessing our
consolidated financial performance, management believes the presentation of segment operating earnings enhances the understanding
of results of operations by highlighting earnings attributable to the normal, ongoing operations of the company's businesses.