Under our current shelf registration that was filed with the SEC and became effective April 29, 2020, we have the ability to issue, in unlimited amounts, unsecured senior debt securities or subordinated debt securities, junior subordinated debt, preferred stock, common stock, warrants, depositary shares, purchase contracts and purchase units of PFG. Our wholly owned subsidiary, Principal Financial Services, Inc. (“PFS”), may guarantee, fully and unconditionally or otherwise, our obligations with respect to any non-convertible securities, other than common stock, described in the shelf registration.

The following tables set forth condensed consolidating financial information of (i) PFG, (ii) PFS, (iii) Principal Life and all other direct and indirect subsidiaries of PFG on a combined basis and (iv) the eliminations necessary to arrive at the information for PFG on a consolidated basis as of March 31, 2021 and December 31, 2020, and for the three months ended March 31, 2021 and 2020.

In presenting the condensed consolidating financial statements, the equity method of accounting has been applied to (i) PFG’s interest in all direct subsidiaries of PFG and (ii) PFS’s interest in Principal Life and all other subsidiaries, where applicable, even though all such subsidiaries meet the requirements to be consolidated under U.S. GAAP. Earnings of subsidiaries are, therefore, reflected in the parent’s investment and earnings. All intercompany balances and transactions, including elimination of the parent’s investment in subsidiaries, between PFG, PFS and Principal Life and all other subsidiaries have been eliminated, as shown in the column “Eliminations.” These condensed consolidating financial statements should be read in conjunction with the consolidated financial statements. The financial information may not necessarily be indicative of results of operations, cash flows or financial position had the subsidiaries operated as independent entities.

PFG sponsors nonqualified benefit plans for select employees and agents and is responsible for the obligations of these plans. Nonqualified plan assets are held in Rabbi trusts for the benefit of all nonqualified plan participants. The Rabbi trusts are separate legal entities and are not a part of PFG on a stand-alone basis. The plan assets are available to satisfy the claims of general creditors only in the event of bankruptcy and are, therefore, consolidated in our statements of financial position.

(1)	PFG sponsors nonqualified benefit plans. Nonqualified benefit plan assets and liabilities held in Rabbi trusts were $830.5 million and $680.2 million, respectively.

Condensed Consolidating Statements of Financial Position

December 31, 2020


					Principal Life
	Principal		Principal		Insurance Company				Principal
	Financial		Financial		and other				Financial
	Group, Inc.		Services, Inc.		subsidiaries				Group, Inc.
	parent only		only		combined (1)		Eliminations		consolidated

	(in millions)
Assets
Fixed maturities, available-for-sale	$	813.2	$	—	$	77,897.1	$	—	$	78,710.3
Fixed maturities, trading		178.8		—		353.3		—		532.1
Equity securities		—		42.9		1,970.5		—		2,013.4
Mortgage loans		—		—		17,343.0		—		17,343.0
Real estate		—		—		1,797.3		—		1,797.3
Policy loans		—		—		784.0		—		784.0
Investment in unconsolidated entities		19,714.3		18,557.9		615.9		(38,045.4)		842.7
Other investments		63.7		156.3		4,064.1		—		4,284.1
Cash and cash equivalents		302.4		657.8		2,188.2		(298.6)		2,849.8
Accrued investment income		2.3		0.2		708.1		—		710.6
Premiums due and other receivables		—		88.9		1,635.1		(0.2)		1,723.8
Deferred acquisition costs		—		—		3,409.7		—		3,409.7
Property and equipment		—		—		1,019.0		—		1,019.0
Goodwill		—		618.5		1,092.5		—		1,711.0
Other intangibles		—		503.6		1,219.4		—		1,723.0
Separate account assets		—		—		175,951.4		—		175,951.4
Other assets		408.1		57.8		1,346.9		(590.3)		1,222.5
Due from subsidiary to parent issuer or guarantor		—		161.4		—		(161.4)		—
Due from parent issuer or guarantor to subsidiary		—		—		843.4		(843.4)		—
Total assets	$	21,482.8	$	20,845.3	$	294,238.9	$	(39,939.3)	$	296,627.7
Liabilities
Contractholder funds	$	—	$	—	$	43,237.7	$	—	$	43,237.7
Future policy benefits and claims		—		—		45,207.2		—		45,207.2
Other policyholder funds		—		—		1,059.4		—		1,059.4
Short-term debt		—		—		84.7		—		84.7
Long-term debt		4,223.3		—		55.9		—		4,279.2
Income taxes currently payable		—		—		79.7		(57.4)		22.3
Deferred income taxes		—		31.3		2,824.4		(524.9)		2,330.8
Separate account liabilities		—		—		175,951.4		—		175,951.4
Other liabilities		700.6		404.7		6,608.2		(131.4)		7,582.1
Due to subsidiary from parent issuer or guarantor		—		843.4		—		(843.4)		—
Due to parent issuer or guarantor from subsidiary		—		—		161.4		(161.4)		—
Total liabilities		4,923.9		1,279.4		275,270.0		(1,718.5)		279,754.8

Redeemable noncontrolling interest		—		—		255.6		—		255.6

Stockholders' equity
Common stock		4.8		—		5.5		(5.5)		4.8
Additional paid-in capital		10,321.6		9,738.4		12,357.7		(22,096.1)		10,321.6
Retained earnings		11,838.0		6,980.7		3,285.9		(10,266.6)		11,838.0
Accumulated other comprehensive income		2,383.1		2,846.8		3,005.8		(5,852.6)		2,383.1
Treasury stock, at cost		(7,988.6)		—		—		—		(7,988.6)
Total stockholders' equity attributable to PFG		16,558.9		19,565.9		18,654.9		(38,220.8)		16,558.9
Noncontrolling interest		—		—		58.4		—		58.4
Total stockholders’ equity		16,558.9		19,565.9		18,713.3		(38,220.8)		16,617.3
Total liabilities and stockholders' equity	$	21,482.8	$	20,845.3	$	294,238.9	$	(39,939.3)	$	296,627.7

(1)	PFG sponsors nonqualified benefit plans. Nonqualified benefit plan assets and liabilities held in Rabbi trusts were $801.7 million and $653.3 million, respectively.

Condensed Consolidating Statements of Operations

For the three months ended March 31, 2021

Principal Life

Principal

Insurance Company

Principal

Financial

and other

Financial

Group, Inc.

Services, Inc.

subsidiaries

Group, Inc.

parent only

only

combined

Eliminations

consolidated

(in millions)

Revenues

Premiums and other considerations

—

835.1

—

835.1

Fees and other revenues

—

69.9

1,124.3

(0.3)

1,193.9

Net investment income

5.5

0.2

1,022.0

0.4

1,028.1

Net realized capital gains (losses)

(14.3)

13.1

152.6

—

151.4

Revenues from parent issuer or guarantor to subsidiary

—

3.2

(3.2)

—

Total revenues

(8.8)

83.2

3,137.2

(3.1)

3,208.5

Expenses

Benefits, claims and settlement expenses

—

1,374.7

—

1,374.7

Dividends to policyholders

—

18.2

—

18.2

Operating expenses

39.5

139.7

1,022.1

0.4

1,201.7

Expenses to subsidiary from parent issuer or guarantor

—

5.0

—

(5.0)

—

Expenses to parent issuer or guarantor from subsidiary

—

(1.5)

1.5

—

Total expenses

39.5

144.7

2,413.5

(3.1)

2,594.6

Income (loss) before income taxes

(48.3)

(61.5)

723.7

—

613.9

Income taxes (benefits)

(12.3)

(15.1)

125.0

—

97.6

Equity in the net income of subsidiaries

553.1

599.5

—

(1,152.6)

—

Net income

517.1

553.1

598.7

(1,152.6)

516.3

Net loss attributable to noncontrolling interest

—

(0.8)

—

(0.8)

Net income attributable to PFG

517.1

553.1

599.5

(1,152.6)

517.1

Net income

517.1

553.1

598.7

(1,152.6)

516.3

Other comprehensive loss

(1,263.9)

(1,257.4)

(1,428.9)

2,520.7

(1,429.5)

Comprehensive loss

(746.8)

(704.3)

(830.2)

1,368.1

(913.2)

Condensed Consolidating Statements of Operations

For the three months ended March 31, 2020


					Principal Life
	Principal		Principal		Insurance Company				Principal
	Financial		Financial		and other				Financial
	Group, Inc.		Services, Inc.		subsidiaries				Group, Inc.
	parent only		only		combined		Eliminations		consolidated

	(in millions)
Revenues
Premiums and other considerations	$	—	$	—	$	2,291.0	$	—	$	2,291.0
Fees and other revenues		—		95.8		1,049.6		(0.1)		1,145.3
Net investment income		3.4		0.8		979.3		0.1		983.6
Net realized capital gains		5.2		5.3		120.9		—		131.4
Revenues from subsidiary to parent issuer or guarantor		—		(1.8)		—		1.8		—
Revenues from parent issuer or guarantor to subsidiary		—		—		4.2		(4.2)		—
Total revenues		8.6		100.1		4,445.0		(2.4)		4,551.3
Expenses
Benefits, claims and settlement expenses		—		—		2,858.7		—		2,858.7
Dividends to policyholders		—		—		28.9		—		28.9
Operating expenses		48.5		130.3		1,156.7		—		1,335.5
Expenses to subsidiary from parent issuer or guarantor		—		3.3		—		(3.3)		—
Expenses to parent issuer or guarantor from subsidiary		—		—		(0.9)		0.9		—
Total expenses		48.5		133.6		4,043.4		(2.4)		4,223.1

Income (loss) before income taxes		(39.9)		(33.5)		401.6		—		328.2
Income taxes (benefits)		(10.1)		(15.2)		68.5		—		43.2
Equity in the net income of subsidiaries		318.7		337.0		—		(655.7)		—
Net income		288.9		318.7		333.1		(655.7)		285.0
Net loss attributable to noncontrolling interest		—		—		(3.9)		—		(3.9)
Net income attributable to PFG	$	288.9	$	318.7	$	337.0	$	(655.7)	$	288.9

Net income	$	288.9	$	318.7	$	333.1	$	(655.7)	$	285.0
Other comprehensive loss		(1,543.4)		(1,557.8)		(1,678.7)		3,133.6		(1,646.3)
Comprehensive loss	$	(1,254.5)	$	(1,239.1)	$	(1,345.6)	$	2,477.9	$	(1,361.3)

Condensed Consolidating Statements of Cash Flows

For the three months ended March 31, 2021

Principal Life

Principal

Insurance Company

Principal

Financial

and other

Financial

Group, Inc.

Services, Inc.

subsidiaries

Group, Inc.

parent only

only

combined

Eliminations

consolidated

(in millions)

Operating activities

Net cash provided by (used in) operating activities

(18.4)

(173.8)

453.5

(120.5)

140.8

Investing activities

Fixed maturities available-for-sale and equity securities with intent to hold:

Purchases

(226.4)

—

(3,641.2)

—

(3,867.6)

Sales

—

704.4

—

704.4

Maturities

95.0

—

2,963.0

—

3,058.0

Mortgage loans acquired or originated

—

(1,368.4)

—

(1,368.4)

Mortgage loans sold or repaid

—

551.1

—

551.1

Real estate acquired

—

(42.4)

—

(42.4)

Net purchases of property and equipment

—

(0.5)

(22.4)

—

(22.9)

Dividends and returns of capital received from unconsolidated entities

415.5

401.8

—

(817.3)

—

Net change in other investments

(3.3)

(36.9)

(92.6)

101.4

(31.4)

Net cash provided by (used in) investing activities

280.8

364.4

(948.5)

(715.9)

(1,019.2)

Financing activities

Issuance of common stock

17.3

—

17.3

Acquisition of treasury stock

(115.5)

—

(115.5)

Payments for financing element derivatives

—

(8.8)

—

(8.8)

Purchase of subsidiary shares from noncontrolling interest

—

(16.6)

—

(16.6)

Dividends to common stockholders

(152.2)

—

(152.2)

Issuance of long-term debt

—

0.8

—

(0.8)

—

Principal repayments of long-term debt

—

(7.8)

(0.4)

7.8

(0.4)

Net proceeds from short-term borrowings

—

0.2

—

0.2

Dividends and capital paid to parent

—

(415.5)

(401.8)

817.3

—

Investment contract deposits

—

2,350.2

—

2,350.2

Investment contract withdrawals

—

(2,183.6)

—

(2,183.6)

Net increase in banking operation deposits

—

141.5

—

141.5

Net cash provided by (used in) financing activities

(250.4)

(422.5)

(119.3)

824.3

32.1

Net increase (decrease) in cash and cash equivalents

12.0

(231.9)

(614.3)

(12.1)

(846.3)

Cash and cash equivalents at beginning of period

302.4

657.8

2,188.2

(298.6)

2,849.8

Cash and cash equivalents at end of period

314.4

425.9

1,573.9

(310.7)

2,003.5

Condensed Consolidating Statements of Cash Flows

For the three months ended March 31, 2020


					Principal Life
	Principal		Principal		Insurance Company				Principal
	Financial		Financial		and other				Financial
	Group, Inc.		Services, Inc.		subsidiaries				Group, Inc.
	parent only		only		combined		Eliminations		consolidated

	(in millions)
Operating activities
Net cash provided by (used in) operating activities	$	20.9	$	(63.1)	$	953.5	$	677.8	$	1,589.1
Investing activities
Fixed maturities available-for-sale and equity securities with intent to hold:
Purchases		(63.2)		—		(3,126.9)		—		(3,190.1)
Sales		—		—		582.4		—		582.4
Maturities		43.2		—		1,940.9		—		1,984.1
Mortgage loans acquired or originated		—		—		(827.3)		—		(827.3)
Mortgage loans sold or repaid		—		—		581.6		—		581.6
Real estate acquired		—		—		(39.6)		—		(39.6)
Net purchases of property and equipment		—		(0.6)		(17.4)		—		(18.0)
Dividends and returns of capital received from unconsolidated entities		433.9		453.7		—		(887.6)		—
Net change in other investments		—		12.7		(15.4)		16.9		14.2
Net cash provided by (used in) investing activities		413.9		465.8		(921.7)		(870.7)		(912.7)
Financing activities
Issuance of common stock		9.0		—		—		—		9.0
Acquisition of treasury stock		(231.8)		—		—		—		(231.8)
Payments for financing element derivatives		—		—		(7.1)		—		(7.1)
Purchase of subsidiary shares from noncontrolling interest		—		—		(0.9)		—		(0.9)
Dividends to common stockholders		(153.6)		—		—		—		(153.6)
Issuance of long-term debt		—		2.3		—		(2.3)		—
Principal repayments of long-term debt		—		(9.1)		(64.5)		9.1		(64.5)
Net proceeds from short-term borrowings		—		—		24.6		—		24.6
Dividends and capital paid to parent		—		(433.9)		(453.7)		887.6		—
Investment contract deposits		—		—		2,725.7		—		2,725.7
Investment contract withdrawals		—		—		(2,255.6)		—		(2,255.6)
Net increase in banking operation deposits		—		—		244.5		—		244.5
Other		—		—		0.1		—		0.1
Net cash provided by (used in) financing activities		(376.4)		(440.7)		213.1		894.4		290.4
Net increase (decrease) in cash and cash equivalents		58.4		(38.0)		244.9		701.5		966.8
Cash and cash equivalents at beginning of period		394.9		598.4		2,656.2		(1,133.6)		2,515.9
Cash and cash equivalents at end of period	$	453.3	$	560.4	$	2,901.1	$	(432.1)	$	3,482.7