The Principal Financial Group to Acquire HSBC AFORE $198M

The Principal Financial Group®, Inc. PFG announced that Principal Financial Group, S.A. de C.V., Grupo Financiero has agreed to acquire 100% of HSBC AFORE, S.A. de C.V from Grupo Financiero HSBC, S.A. de C.V. for approximately US $198 million based on current exchange rates (Mexican Pesos 2,360 million). In addition, The Principal® and HSBC Bank have agreed to establish an exclusive distribution arrangement, subject to regulatory approval, for the distribution of Principal AFORE's products through HSBC's extensive network of more than 1,100 branches. HSBC has one of the largest banking networks in Mexico. The AFORE transaction is expected to be immediately accretive to EPS and ROE, and is expected to close by early third quarter 2011, subject to regulatory approval.