BCI Group Adopts the Principal Financial Group Name.

Business Editors

DES MOINES, Iowa--(BUSINESS WIRE)--April 1, 2003

Nation's 401(k) Leader Cites Early Successes in ESOP Activity

Benefit Consultants, Inc. (BCI Group), acquired by The Principal Financial Group(R), the nation's 401(k) leader, has changed its name to the parent company identity. Effective immediately, the prominent employee stock ownership (ESOP) leader will operate as The Principal Financial Group. The acquisition closed in January 2003.

BCI Group is well known in the industry as a full-service consulting, actuarial, and administration firm specializing in qualified and non-qualified retirement benefit plans with a primary focus on ESOPs. The Principal(R) now provides services to more than 40 of the country's 100 largest majority-owned ESOP companies and supports over 300,000 ESOP participants.

"We're very eager to debut this dynamic package of complete retirement solutions to more and more growing businesses and institutions," said Daniel J. Houston, senior vice president at The Principal. "Following the acquisition, I believe The Principal is the only retirement services provider today able to offer a total retirement continuum, including full-service defined contribution, defined benefit, non-qualified and complete ESOP capabilities."

Dennis Long, who headed BCI as CEO and now serves as vice president at The Principal, cited growing incentives for private and public companies to establish ESOPs following passage of the Economic Growth Tax Relief Reconciliation Act (EGTRRA). Long says EGTRRA will stimulate growth because qualified plans with employer securities now receive a corporate tax deduction on dividends.

Another provision of EGTRRA that is building interest among employers encourages the creation of the so-called KSOP -- a combination Employee Stock Ownership Plan and 401(k). Companies that offer employer stock as an option in their 401(k) plans can get an additional tax break if they change the plan to a KSOP.

"Plan sponsors are as interested in one-stop shopping as employees and are looking for full-service providers who can be a single source of multiple types of plans," Long says. One such firm, ComDoc, Inc., a leading document solutions company, has its 401(k) and ESOP with The Principal. "We're current clients of both BCI Group and The Principal, and believe that they are industry leaders in pension management. For years we've been looking for a way to consolidate administration and reporting for our ESOP and 401(k) plans, so of course we were very excited to hear that they had joined forces. We believe that this will allow more comprehensive retirement planning, administration and communication for our partners," said Andrea Capuano, Human Resources Manager at ComDoc.

Long cited several early successes of integration, and expects continued strong opportunities in both stand-alone ESOPs and total retirement solutions. He also announced hiring two prominent consultants in the ESOP industry. Timothy Cleary, Senior Consultant, is leading the team focusing on ESOP transaction design, financial analysis, ESOP feasibility studies, and repurchase obligation analysis. He is located in the Minneapolis office. Before joining BCI, Tim led the national ESOP practice at Ernst & Young. Joseph Marx, Consultant, has joined the ESOP transaction design team and is located in the Buffalo office. Joe brings more than 18 years of experience with Ernst & Young. Long pointed to the hires as evidence of the company's continued commitment to attracting top industry talent and growing the business.

About The Principal

The Principal Financial Group(R) (The Principal (R))(1) is a leader in offering businesses, individuals and institutional clients a wide range of financial products and services, including retirement and investment services, life and health insurance and mortgage banking through its diverse family of financial services companies. More employers choose the Principal Financial Group for their 401(k) plans than any other bank, mutual fund, or insurance company in the United States(2). A member of the Fortune 500, the Principal Financial Group has $111.1 billion in assets under management(3) and serves some 13 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG. For more information, visit www.principal.com.

(1)"The Principal Financial Group" and "The Principal" are registered service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.

(2)CFO Magazine, April/May 2002, based on total plans served in 2001 by insurance companies, banks and investment firms.

(3)As of December 31, 2002.