Official Letter Authorizing the Spin-off of Principal Financial Group, S.A. de C.V., Financial Group

DOF: 28/08/2025

OFFICIAL LETTER authorizing the spin-off of Principal Financial Group, S

A seal with the National Emblem appears on the margin, which reads: United Mexican States.- Treasury.- Ministry of Public Finance and Public Credit.- Undersecretariat of Public Finance and Public Credit.- Insurance, Pensions and Social Security Unit.- Legal Coordination of Insurance, Sureties and Pensions.- Official Letter No. 366-III-346/2025.

PRINCIPAL FINANCIAL GROUP, S.A. DE C.V.

FINANCIAL GROUP

Pedregal No. 24, Virreyes Tower, 24th Floor

Molino del Rey Neighborhood

C.P. 11040

To:

Armando Ortiz González

Representative

The Ministry of Finance and Public Credit, through the Legal Coordination of Insurance, Sureties and Pensions attached to the Insurance, Pensions and Social Security Unit, based on articles 31, fraction XXXIV of the Organic Law of the Federal Public Administration; 18 of the Law to Regulate Financial Groups, and articles 3, 4, section B, fraction V, subsection d); 8, first paragraph and 16 G, fraction V of the Internal Regulations of the Ministry of Finance and Public Credit, issues the resolution indicated below, in attention to the following background and considerations:

BACKGROUND

I.

Principal Financial Group, S.A. de C.V., Financial Group (Financial Group), is a company authorized to organize itself as a controlling company and to be constituted and operate as a financial group, as stated in resolution 101.-527 of December 23, 2010, published in the Official Gazette of the Federation on February 21, 2011, last modified by official letter 366-III-008/2024 of January 9, 2024, published in the Official Gazette of the Federation on February 23, 2024.

II.

The Financial Group is composed of the following financial entities:

1.

Principal Afore, S.A. de C.V., Principal Financial Group (Principal Afore).

2.

Principal Fondos de Inversión, S.A. de C.V. Fund Operator, Principal Financial Group (Principal Operator)

3.

Principal Seguros, S.A. de C.V., Principal Financial Group (Principal Insurance)

III.

With a letter dated August 30, 2024, the Financial Group requests authorization for the spin-off of the controlling company under the following terms:

1.

By letter dated May 10, 2024, Principal Insurance requested the National Insurance and Sureties Commission for the revocation of the authorization to operate as an insurance institution, as resolved by its extraordinary general shareholders' meeting of May 2, 2024.

2.

If the revocation of Principal Insurance's authorization is approved, only two financial entities will remain in the Financial Group. In light of this and considering that Principal Afore and Principal Operator did not take advantage of the benefit of acting jointly before the public and offering complementary services, that is, they did not take advantage of the benefits of being constituted as a financial group, such that they do not consider it necessary for their operation to be constituted as a financial group and require greater strategic corporate flexibility, the shareholders of the Financial Group have decided that the best strategy for the development and solidity of each of its financial entities is to request the spin-off of the controlling company.

3.

As a result of the spin-off, two new Mexican commercial companies will be constituted, which will be named "Principal International Mexico I, S.A. de C.V." and "Principal International Mexico II, S.A. de C.V."

4.

The companies indicated in item 3:

a)

Will not carry out, nor seek to carry out activities reserved for retirement fund administrators, specialized investment companies for retirement funds, fund operating companies, insurance institutions, or any other financial entities in which they participate as shareholders, therefore they will not be constituted as financial entities.

b)

Will not carry out nor seek to carry out activities reserved for financial groups.

c)

Will be exclusively Mexican commercial companies that will participate in the share capital of certain financial entities.

d)

Will have the same shareholders as the Financial Group currently has, which are: Principal International México, LLC and Principal International Holding Company, LLC.

5.

Once the spin-off of the controlling company is authorized, the Financial Group will be extinguished, and:

a)

The company Principal International Mexico I, S.A. de C.V. will receive the ownership of the shares representing the share capital of Principal Afore and consequently of its retirement fund investment companies: Principal Siefore Básica Inicial, S.A. de C.V.; Principal Siefore Básica 65-69, S.A. de C.V.; Principal Siefore Básica 70-74, S.A. de C.V.; Principal Siefore Básica 80-84, S.A. de C.V.; Principal Siefore Básica 90-94, S.A. de C.V. and Principal Siefore Adicional RV, S.A. de C.V.

b)

The company Principal International México II, S.A. de C.V. will receive ownership of the shares representing the share capital of Principal Operator and Principal Insurance.

IV.

With the attached request letter, the following information and documentation is submitted:

1.

Simple copy of public deed 29,881 of April 11, 2024, granted before the notary of Lic. Eduardo Francisco García Villegas Sánchez Cordero, Public Notary No. 48, with practice in Mexico City, which contains, among other things, the power granted to Mr. Armando Ortiz González to act on behalf and in representation of the Financial Group.

2.

Draft minutes of the extraordinary general shareholders' meeting of the Financial Group containing the agreements regarding the spin-off.

3.

Draft bylaws of the companies Principal International Mexico I, S.A. de C.V. and Principal International Mexico II, S.A. de C.V.

4.

Audited and consolidated financial statements of the Financial Group as of December 31, 2022 and 2023.

5.

Audited and non-consolidated financial statements of the Financial Group as of December 31, 2022 and 2023.

V.

By official letters 366-III-362/2024, 366-III-363/2024, 366-III-364/2024, 366-III-365/2024 of September 10, 2023, opinions were requested from the National Commission for the Retirement Savings System, Bank of Mexico, National Banking and Securities Commission and National Insurance and Sureties Commission, respectively.

VI.

With a letter dated October 15, 2024, the Financial Group, in extension of its letter indicated in Background III, submits the projected financial statements of the spun-off companies Principal International Mexico I, S.A. de C.V. and Principal International Mexico II, S.A. de C.V.

VII.

By official letters 366-III-416/2024, 366-III-417/2024, 366-III-418/2024 and 366-III-419/2024 of October 18, 2024, the information indicated in Background VI was sent to the National Commission for the Retirement Savings System, to the Bank of Mexico, to the National Banking and Securities Commission, as well as to the National Insurance and Sureties Commission, respectively.

VIII.

The National Banking and Securities Commission and the National Commission for the Retirement Savings Systems with official letters 312-3/9140/2025 and D00/400/426/2025 of January 28, 2024 and February 12, 2025, respectively, issued their opinion.

IX.

The National Insurance and Sureties Commission by official letter 06-C00-41100-02236/2025 of February 10, 2025, communicated to this Administrative Unit that it has no opinion to issue, in view of the fact that there is no financial institution within the integration of said Financial Group operating under the regulation of said Commission, since by official letter 06-C00-41100-37218/ 2024 of December 10, 2024 the authorization to Principal Insurance, S.A. de C.V., Principal Financial Group to operate as a regulated insurance subsidiary was revoked.

X.

By official letter OFI002-921 of November 21, 2024, the Bank of Mexico requested various information consisting of, the corporate and share capital structure of the Financial Group, share capital structure of the spun-off companies and schedule to modify the bylaws of the financial entities currently part of the Financial Group.

XI.

With a letter dated March 24, 2025, the Financial Group submitted additional documentation and information on the structure and share capital of the Financial Group, update of the share capital of the spun-off companies corporate and schedule to modify the bylaws of the entities part of the Financial Group.

XII.

By official letter 366-III-152/2025 of March 25, 2025, the Legal Coordination of Insurance, Sureties and Pensions sent the information indicated in Background X to the Bank of Mexico.

XIII.

By official letter OFI002-975 of June 5, 2025 the Bank of Mexico issued its opinion.

CONSIDERATIONS

I.

Article 18 of the Law to Regulate Financial Groups provides that, for the spin-off of a controlling company, prior authorization from the Ministry of Finance and Public Credit will be required, who will hear the opinion of the Bank of Mexico and, as appropriate, of the National Banking and Securities Commission, of Insurance and Sureties or of the Retirement Savings System.

II.

Article 228 of the General Law of Commercial Companies, applied supplementarily in accordance with article 4º., fraction I of the Law to Regulate Financial Groups, stipulates that, a spin-off occurs when a company called the spun-off company decides to extinguish itself and divides all or part of its assets, liabilities and share capital into two or more parts, which are contributed in block to other newly created companies called the spun-off companies.

III.

In this sense, due to the spin-off, the controlling company of the Financial Group will contribute all of its assets, liabilities and share capital to two newly created companies "Principal International Mexico I, S.A. de C.V." and "Principal International Mexico II, S.A. de C.V."

IV.

With the letters and documentation of August 30 and October 15, 2024, as well as March 24, 2025, through which the Financial Group is considered to be requesting the spin-off of the controlling company, it was determined that the information indicated in article 18 of the Law to Regulate Financial Groups is available, following:

1.

Draft minutes of the extraordinary general shareholders' meeting, which contains the agreement regarding the spin-off of the controlling company.

2.

Draft bylaws of the spun-off companies "Principal International Mexico I, S.A. de C.V." and "Principal International Mexico II, S.A. de C.V."

3.

Audited consolidated and non-consolidated financial statements of the Financial Group as of December 31, 2022 and 2023.

4.

Projected financial statements of Principal International Mexico I, S.A. de C.V." and "Principal International Mexico II, S.A. de C.V".

V.

From the analysis of the request presented by the Financial Group, as well as from the information and documentation received, it was concluded that from a legal and administrative point of view it is appropriate to issue this document.

RESOLUTIONS

First. - This Ministry authorizes the spin-off of the controlling company of Principal Financial Group, S.A. de C.V. Financial Group who for this purpose will contribute in block to the spun-off companies, the share capital, assets and liabilities of Principal Afore, S.A. de C.V., Principal Financial Group; Principal Fondos de Inversión, S.A. de C.V. Fund Operator, Principal Financial Group and Principal Insurance, S.A. de C.V., Principal Financial Group (in liquidation), under the following terms:

1.

To Principal International Mexico I, S.A. de C.V. the share capital, assets and liabilities of Principal Afore, S.A. de C.V., Principal Financial Group will be contributed in block.

2.

To Principal International Mexico II, S.A. de C.V. the share capital, assets and liabilities of Principal Fondos de Inversión, S.A. de C.V. Fund Operator, Principal Financial Group and Principal Insurance, S.A. de C.V., Principal Financial Group (in liquidation) will be contributed in block.

Second. - The spin-off of the controlling company of Principal Financial Group, S.A. de C.V., Financial Group will take effect from the date on which the public instrument is registered in the Public Commerce Register in which the agreement of the extraordinary general shareholders' meeting of Principal Financial Group, S.A. de C.V. Financial Group, which agreed to the spin-off of the controlling company, as well as this authorization, is recorded.

Third. - This authorization and the agreement of the assembly cited in the previous resolutive clause must be published in the Official Gazette of the Federation at the expense of Principal Financial Group, S.A. de C.V., Financial Group, in accordance with the second paragraph of article 19 of the Law to Regulate Financial Groups.

Fourth. - With this official letter and in accordance with the last paragraph of article 18 of the Law to Regulate Financial Groups:

1.

The authorization granted to Principal Financial Group, S.A. de C.V., Financial Group, to constitute and operate as a controlling company and authorized to operate the respective financial group, by official letter 101.-527 of December 23, 2010, published in the Official Gazette of the Federation on February 21, 2011 and last modified by official letter 366-III-008/2024 of January 9, 2024, published in the Official Gazette of the Federation on February 23, 2024, is without effect, without, for this purpose, the issuance of an express declaration by this Ministry being necessary.

2.

From the time the spin-off takes effect in accordance with what is stated in Resolution Second of this official letter, the financial entities that were part of Principal Financial Group, S.A. de C.V. Financial Group must cease to be presented as members thereof.

Fifth. - The financial entities that were part of Principal Financial Group, S.A. de C.V., Financial Group, must not act jointly, nor offer complementary services, as stated in article 3 of the Law to Regulate Financial Groups.

This is issued based on the information provided by Principal Financial Group, S.A. de C.V., Financial Group indicated in the Backgrounds and is limited exclusively to the spin-off of the controlling company of Principal Financial Group, S.A. de C.V., Financial Group, which in accordance with the applicable provisions competes to resolve this Ministry and does not prejudge the carrying out of any act that said financial group or financial entities that were part of it, carry out, which implies the prior authorization or approval of other authorities and also does not validate any that has been carried out in contravention of current regulations.

Respectfully

Mexico City, July 3, 2025. - The Head of the Coordination, Yolanda Torres Segarra.- Rubric.

(R.- 568176)

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