Lincoln National Corp. is getting statutory capital relief from an arm of Goldman Sachs Group Inc. rather than participating in a federal bank support program.

Lincoln, Radnor, Pa., says it has withdrawn a previously announced application submitted to the Federal Deposit Insurance Corp.’s Temporary Liquidity Guarantee Program.

Lincoln qualifies as a savings and loan holding company, and it thought at the time that it might be eligible for TLGP participation, the company says.

“At this time, we do not believe that we qualify under the current provisions of the TLGP, and, therefore, we have decided to voluntarily withdraw our application to participate in the program,” Lincoln says in a report filed with the U.S. Securities and Exchange Commission.

If Congress changes TGLP eligibility rules in the future, “to the extent that the provisions of the TLGP are revised to broaden participation in the program under terms otherwise acceptable to us, we would consider submitting another application,” Lincoln says.

In related news, Lincoln says it has agreed to reinsure an in-force block of universal life and variable universal life insurance policies written by Lincoln National Life Insurance Company and predecessor companies with Commonwealth Annuity and Life Insurance Company, Southborough, Mass., a subsidiary of Goldman Sachs, New York.

The transaction will take effect Tuesday, Lincoln says.

“Under the terms of the agreement, Commonwealth Annuity will provide 55% quota share coinsurance, and Lincoln will reinsure approximately $1.5 billion in estimated reserves to Commonwealth Annuity,” Lincoln says.

The deal should improve Lincoln’s statutory risk-based capital level by about $240 million, but it will reduce annual consolidated net income by about $20 million, Lincoln says.

The deal will result in the transfer of a closed block of life policies and will not include distribution or future new business value, Lincoln says. “The reinsurance transaction combined with other moves taken recently by the company, such as reducing the common stock dividend and restructuring the company to reduce expenses, demonstrates the company’s ongoing commitment to managing capital effectively, particularly during this difficult market,” Lincoln says.

Investors reacted to Lincoln’s announcement and the general economic news of the day by selling, causing the price of a share to drop to less than $6.50, down from a price of $8.50 when trading opened.