Principal Financial Group Inc. (PFG:US), the provider of life insurance and retirement products, affirmed its commitment to banking as rivals depart to limit regulation.
Principal benefits from the ability to hold government- insured deposits “as a way of parking people’s money while they develop their plans” for retirement, Jim McCaughan, chief executive officer of the firm’s global investors business, said today at a conference in New York.
MetLife Inc., which is subject to greater government oversight because of its size, is exiting banking after the Federal Reserve rejected the insurer’s plans to boost its dividend and resume share buybacks. Hartford Financial Services Group Inc. (HIG:US) and Allstate Corp. (ALL:US) have also retreated from banking. Des Moines, Iowa-based Principal is regulated as a savings and loan, while MetLife is considered a bank holding company.
“Don’t paint everyone with the same paint brush,” Principal Global Investors Chief Operating Officer Barb McKenzie said today at the conference, which was sponsored by KBW Inc. “What’s going on with us and the relationship with the Fed is really profoundly different, at this point at least, to what Met’s been experiencing.”
McKenzie said Principal underwent a three-week Fed review that she described as “collaborative.”
“I’ve met crazy regulators all around the world, and these were not crazy regulators,” she said.
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