TEXT-Fitch rates Principal Financial Group's notes 'A-'

Thu Sep 20, 2012 10:16am EDT

Sept 20 - Fitch Ratings has assigned an 'A-' rating to Principal Financial
Group, Inc.'s (PFG) recent issuance of $300 million of 10-year 3.30%
senior unsecured notes and $300 million of 30-year 4.625% senior unsecured
notes. PFG's long-term Issuer Default Rating is unaffected by this rating
action.

Fitch affirmed the ratings of PFG and its insurance operating subsidiaries with
a Stable Outlook on June 25, 2012.

The notes are guaranteed by PFG's intermediate holding company, Principal
Financial Services, Inc., of which the organization's primary operating
companies are wholly owned subsidiaries. This includes Principal Life Insurance
Company, PFG's largest insurance operating subsidiary and the source of the vast
majority of the overall organization's operating cash flow.

Fitch expects proceeds from the debt issuance to be used to help fund PFG's
ongoing growth, which is expected to be achieved both organically and through
moderately-sized acquisitions, and potentially to fund the repayment of PFG's
$400 million of senior unsecured notes maturing in May 2014.

Fitch does not expect the issuance of the new senior debt to result in an
increase in PFG's financial leverage ratio above Fitch's rating trigger of 25%.
The company's financial leverage was approximately 18% at June 30, 2012.

PFG, headquartered in Des Moines, IA, markets a range of retirement savings,
investment and insurance products and services primarily in the small- to
medium-sized business segment. PFG reported consolidated assets of $152 billion,
and total shareholders' equity of $9.4 billion at June 30, 2012.

Fitch has assigned the following ratings:

Principal Financial Group, Inc.
--$300 million 3.3% senior unsecured notes due 2022 'A-';
--$300 million 4.625% senior unsecured notes due 2042 'A-'.

Additional information is available at 'www.fitchratings.com'. The ratings above
were solicited by, or on behalf of, the issuer, and therefore, Fitch has been
compensated for the provision of the ratings.

Applicable Criteria and Related Research:
--'Insurance Rating Methodology' (Sept. 19, 2012);
--'Principal Financial Group' (July 24, 2012).

Applicable Criteria and Related Research:
Insurance Rating Methodology
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