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June 12, 2009 at 08:00 PM
One insurer announced it was rejecting funds from the government’s Troubled Asset Relief Program, while another said it would accept them.
Principal Financial Group Inc. says that it will decline the financial aid offered by the Federal government to a number of troubled corporate giants.
In turning down funds under the U.S. Dept. of the Treasury’s capital purchase program, Principal, Des Moines, Iowa, noted that the credit market has improved from last fall, when it first applied for aid.
“We have decided not to participate in the CPP due to the stabilization of the credit and financial systems in the U.S. and the further strengthening of our already solid financial and capital position,” said Larry Zimpleman, chairman, president and chief executive officer of the company.
The Principal was one of six insurers whose application for financial aid under the Treasury’s Capital Purchase Program was approved April 14. But, with the Principal’s decision, 4 of the 6 have now declared they would not to take the help because of the improvement in market conditions.
The others are Prudential Financial, Newark, N.J.; Ameriprise Financial, Minneapolis, Minn.; and Allstate Financial, Northbrook, Ill.
Hartford Financial Group, Hartford, Conn., has accepted the aid, and
In his statement, Zimpleman explained that when the Principal first applied for the aid in November 2008, the credit markets were inactive.
