Lincoln National receives $950M in gov't aid

PHILADELPHIA - Life insurer Lincoln National Corp. said Friday it has received $950 million from the federal government under its Troubled Asset Relief Program.

Lincoln National, which markets itself as Lincoln Financial Group, was one of six insurers who received approval in May to tap the U.S. Treasury department's $700 billion bailout program. Lincoln National had been approved to receive up to $2.5 billion from the government, but opted for the smaller amount.

The $950 million in aid completes a $2.14 billion capital raising effort by the insurer. Aside from the TARP funds, Lincoln National recently raised $690 million through the sale of common stock and $500 million through the sale of senior debt in private markets.

Lincoln National said it contributed $1 billion to the capital base of its primary insurance subsidiary, Lincoln National Life Insurance Co.

As the banking industry accepted billions in government bailout funds last fall, life insurers aggressively lobbied for their own piece of the financial rescue plan, worried about their balance sheets, which had been saddled by hefty investment losses from the declines in the stock market. But the government was slow to approve the requests. Subsequently, the stocks of most public insurance companies fell sharply before recently rebounding somewhat with the broader market.

Besides Lincoln National, Hartford Financial Services Group Inc., Allstate Corp., Prudential Financial Inc., Ameriprise Financial Inc. and Principal Financial Group Inc. all were approved to receive TARP funds.

Of those, only Hartford has accepted the support. It received $3.4 billion last month.

Shares of Lincoln National fell 58 cents, or 3.8 percent, to $14.74 in afternoon trading.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.