Des Moines-Based Principal Financial Seeks $2 Billion From U.S. Treasury
National News • November 20, 2008
Des Moines-based Principal Financial Group has applied to the U.S. Treasury for $2 billion from a capital purchase program.
The retirement, insurance and financial services company says it would ...
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Subject: RE: RE: Federal Bail out. Principal Financial Group
Posted On: November 21, 2008, 7:38 pm CST
Posted By: FanofResearch
Comment:
They aren't into the subprime mortgage business. The reason it's dropped so sharply lately is because a) the market as a whole has taken a huge hit, in particular the financial sector, and b)analysts have been saying PFG has huge exposure to commercial mortgage backed securities (CMBS) which are suspected to be a next trouble zone. That information is incorrect. Here is the real story on PFG's exposure to CMBS: PFG's CMBS portfolio is 8 percent of their total invested assets. PFG's CMBS portfolio is high quality with 99 percent rated as investment grade. PFG's CMBS portfolio continues to perform well given the current environment. The underlying commercial mortgages that make up these securities continue to perform with less than 1 percent of these loans delinquent.
Bailout is a misnomer. The purpose of the CPP is to help to boost lending and extension of credit by healthy financial institutions. Insurance companies can play a critical role in getting lending going again as insurers are a primary source of intermediate and long-term lending. The thinking of the company is that it's simply prudent capital management to consider the CPP as one additional option in a range of options at a time of uncertain market conditions.
It would behoove you to visit some research sites and visit the company's own financial information on their website and educate yourself prior to assuming the company's stock is low because of subprime mortgages.
Subject: RE: RE: Federal Bail out. Principal Financial Group
Bailout is a misnomer. The purpose of the CPP is to help to boost lending and extension of credit by healthy financial institutions. Insurance companies can play a critical role in getting lending going again as insurers are a primary source of intermediate and long-term lending. The thinking of the company is that it's simply prudent capital management to consider the CPP as one additional option in a range of options at a time of uncertain market conditions.
It would behoove you to visit some research sites and visit the company's own financial information on their website and educate yourself prior to assuming the company's stock is low because of subprime mortgages.