Lincoln Financial Receives Preliminary Approval for $2.5 Billion from Treasury’s Capital Purchase Program

PHILADELPHIA, May 14 /PRNewswire-FirstCall/ -- Lincoln Financial Group (NYSE: LNC) today announced that it has received preliminary approval to participate in the U.S. Treasury Department's Capital Purchase Program (CPP) in the amount of $2.5 billion. The CPP is part of Treasury's Troubled Asset Relief Program, which is a voluntary program for healthy financial institutions to support economic development and restore stability to the national economy.

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Dennis R. Glass, President and Chief Executive Officer of Lincoln Financial, said, "Over the past several months, we have been actively and prudently taking measures to strengthen our liquidity and capital positions at both the holding company and our insurance subsidiaries. Consistent with that goal, access to the Treasury's Capital Purchase Program is a means to further enhance the company's financial flexibility and capital in what has continued to be an unprecedented economic environment. We appreciate this preliminary approval for inclusion in the CPP program, subject to a final review of its terms and conditions."

Glass continued, "We are pleased that the Treasury Department has recognized the critical role that insurers play in providing liquidity to the financial system and that it is willing to act in a manner that will strengthen the balance sheets of the nation's insurers."

Lincoln Financial Group is the marketing name for Lincoln National Corporation (NYSE: LNC) and its affiliates. With headquarters in the Philadelphia region, the companies of Lincoln Financial Group had assets under management of $171 billion as of March 31, 2009. Through its affiliated companies, Lincoln Financial Group offers: annuities; life, group life and disability insurance; 401(k) and 403(b) plans; savings plans; mutual funds; managed accounts; institutional investments; and comprehensive financial planning and advisory services. Affiliates also include: Delaware Investments, the marketing name for Delaware Management Holdings, Inc. and its subsidiaries; and Lincoln UK. For more information, including a copy of our most recent SEC reports containing our balance sheets, please visit www.LincolnFinancial.com.

Forward Looking Statements -- Cautionary Language

Certain statements made in this release and in other written or oral statements made by Lincoln or on Lincoln's behalf are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 ("PSLRA"). A forward-looking statement is a statement that is not a historical fact and, without limitation, includes any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like: "believe", "anticipate", "expect", "estimate", "project", "will", "shall" and other words or phrases with similar meaning in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, trends in our businesses, prospective services or products, future performance or financial results, and the outcome of contingencies, such as legal proceedings. Lincoln claims the protection afforded by the safe harbor for forward-looking statements provided by the PSLRA.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from the results contained in the forward-looking statements. Risks and uncertainties that may cause actual results to vary materially, some of which are described within the forward-looking statements include, among others:

     --  Continued deterioration in general economic and business conditions,         both domestic and foreign, that may affect foreign exchange rates,         premium levels, claims experience, the level of pension benefit costs         and funding and investment results;     --  Continued economic declines and credit market illiquidity could cause us         to realize additional impairments on investments and certain intangible         assets, including goodwill and a valuation allowance against deferred         tax assets, which may reduce future earnings and/or affect our financial         condition and ability to raise additional capital or refinance existing         debt as it matures;     --  Uncertainty about the impact of the U.S. Treasury's Troubled Asset         Relief Program on the economy; and Lincoln's ability to participate         in the program;     --  Legislative, regulatory or tax changes, both domestic and foreign, that         affect the cost of, or demand for, Lincoln's products, the required         amount of reserves and/or surplus, or otherwise affect our ability to         conduct business, including changes to statutory reserves and/or         risk-based capital requirements related to secondary guarantees under         universal life and variable annuity products such as Actuarial Guideline         VACARVM; restrictions on revenue sharing and 12b-1 payments; and the         potential for U.S. Federal tax reform;     --  The initiation of legal or regulatory proceedings against Lincoln or its         subsidiaries, and the outcome of any legal or regulatory proceedings,         such as: (a) adverse actions related to present or past business         practices common in businesses in which Lincoln and its subsidiaries         compete; (b) adverse decisions in significant actions including, but not         limited to, actions brought by federal and state authorities and         extra-contractual and class action damage cases; (c) new decisions that         result in changes in law; and (d) unexpected trial court rulings;     --  Changes in interest rates causing a reduction of investment income, the         margins of Lincoln's fixed annuity and life insurance businesses         and demand for Lincoln's products;     --  A decline in the equity markets causing a reduction in the sales of         Lincoln's products, a reduction of asset-based fees that Lincoln         charges on various investment and insurance products, an acceleration of         amortization of deferred acquisition costs, value of business acquired,         deferred sales inducements and deferred front-end loads and an increase         in liabilities related to guaranteed benefit features of Lincoln's         variable annuity products;     --  Ineffectiveness of Lincoln's various hedging strategies used to         offset the impact of changes in the value of liabilities due to changes         in the level and volatility of the equity markets and interest rates;     --  A deviation in actual experience regarding future persistency,         mortality, morbidity, interest rates or equity market returns from         Lincoln's assumptions used in pricing its products, in establishing         related insurance reserves and in the amortization of intangibles that         may result in an increase in reserves and a decrease in net income,         including as a result of stranger-originated life insurance business;     --  Changes in GAAP that may result in unanticipated changes to         Lincoln's net income;     --  Lowering of one or more of Lincoln's debt ratings issued by         nationally recognized statistical rating organizations and the adverse         impact such action may have on Lincoln's ability to raise capital         and on its liquidity and financial condition;     --  Lowering of one or more of the insurer financial strength ratings of         Lincoln's insurance subsidiaries and the adverse impact such action         may have on the premium writings, policy retention, profitability of its         insurance subsidiaries and liquidity;     --  Significant credit, accounting, fraud or corporate governance issues         that may adversely affect the value of certain investments in the         portfolios of Lincoln's companies requiring that Lincoln realize         losses on such investments;     --  The impact of acquisitions and divestitures, restructurings, product         withdrawals and other unusual items, including Lincoln's ability to         integrate acquisitions and to obtain the anticipated results and         synergies from acquisitions;     --  The adequacy and collectibility of reinsurance that Lincoln has         purchased;     --  Acts of terrorism, a pandemic, war or other man-made and natural         catastrophes that may adversely affect Lincoln's businesses and the         cost and availability of reinsurance;     --  Competitive conditions, including pricing pressures, new product         offerings and the emergence of new competitors, that may affect the         level of premiums and fees that Lincoln can charge for its products;     --  The unknown impact on Lincoln's business resulting from changes in         the demographics of Lincoln's client base, as aging baby-boomers         move from the asset-accumulation stage to the asset-distribution stage         of life; and 
     --  Loss of key management, portfolio managers in the Investment Management         segment, financial planners or wholesalers. 

The risks included here are not exhaustive. Lincoln's annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and other documents filed with the SEC include additional factors which could impact Lincoln's business and financial performance. Moreover, Lincoln operates in a rapidly changing and competitive environment. New risk factors emerge from time to time and it is not possible for management to predict all such risk factors.

Further, it is not possible to assess the impact of all risk factors on Lincoln's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. In addition, Lincoln disclaims any obligation to update any forward-looking statements to reflect events or circumstances that occur after the date of the release.

SOURCE Lincoln Financial Group