As of December 31, 2011, we had 13.0 million shares of preferred stock authorized, issued and outstanding under the two series described below. Preferred stockholders have dividend and liquidation priority over common stockholders.

Series A. Dividends on the Series A Preferred Stock are non-cumulative and are payable quarterly when, and if, declared by our Board of Directors at a rate of 5.563% per annum of the liquidation preference. On or after the dividend payment date in June 2015, the Series A initial distribution rate will become a floating rate, subject to reset, at our option, subject to certain conditions and parameters. If reset, the rate may be at fixed or floating rates. On or after the dividend payment date in June 2015, we may, at our option, redeem the shares at a price of $100 per share, or $300.0 million in the aggregate, plus accrued and unpaid dividends for the then current dividend period to the date of redemption, if any.

The Series A Preferred Stock has no stated maturity and is not convertible into any other of our securities. Series A Preferred Stock will have no voting rights, except with respect to certain fundamental changes in the terms of the shares and in the case of certain dividend non-payments.

Series B. Dividends on the Series B Preferred Stock are non-cumulative and are payable quarterly when, and if, declared by the Board of Directors at a rate of 6.518% per annum of the liquidation preference. On or after the dividend payment date in June 2035, the Series B initial distribution rate will become a floating rate, subject to reset, at our option, subject to certain conditions and parameters. If reset, the rate may be at fixed or floating rates. On or after the dividend payment date in June 2015, we may, at our option, redeem the shares at a price of $25 per share, or $250.0 million in the aggregate, plus accrued and unpaid dividends for the then current dividend period to the date of redemption, if any.

The Series B Preferred Stock has no stated maturity and is not convertible into any other of our securities. Series B Preferred Stock will have no voting rights, except with respect to certain fundamental changes in the terms of the shares and in the case of certain dividend non-payments.

The certificates of designation for the Series A and B Preferred Stock restrict the declaration of preferred dividends if we fail to meet specified capital adequacy, net income or stockholders' equity levels. As of December 31, 2010, we have no preferred dividend restrictions.

On March 30, 2011, June 30, 2011, September 30, 2011 and December 30, 2011, we paid a dividend of $8.2 million, $8.3 million, $8.2 million and $8.3 million, respectively, equal to $1.39 per share on Series A non-cumulative perpetual preferred stock and equal to $0.41 per share on Series B non-cumulative perpetual preferred stock. Dividends were paid to stockholders of record as of March 11, 2011, June 9, 2011, September 8, 2011 and December 8, 2011, respectively.

On March 30, 2010, June 30, 2010, September 30, 2010 and December 30, 2010, we paid a dividend of $8.2 million, $8.3 million, $8.2 million and $8.3 million, respectively, equal to $1.39 per share on Series A non-cumulative perpetual preferred stock and equal to $0.41 per share on Series B non-cumulative perpetual preferred stock. Dividends were paid to stockholders of record as of March 11, 2010, June 10, 2010, September 9, 2010 and December 9, 2010, respectively.

On March 30, 2009, June 30, 2009, September 30, 2009 and December 30, 2009, we paid a dividend of $8.2 million, $8.3 million, $8.2 million and $8.3 million, respectively, equal to $1.39 per share on Series A non-cumulative perpetual preferred stock and equal to $0.41 per share on Series B non-cumulative perpetual preferred stock. Dividends were paid to stockholders of record as of March 12, 2009, June 11, 2009, September 10, 2009 and December 14, 2009, respectively.

On December 2, 2011, we paid an annual dividend of $213.7 million, equal to $0.70 per share, to stockholders of record as of November 10, 2011. On December 3, 2010, we paid an annual dividend of $176.2 million, equal to $0.55 per share, to stockholders of record as of November 19, 2010. On December 4, 2009, we paid an annual dividend of $159.5 million, equal to $0.50 per share, to stockholders of record as of November 13, 2009.

	Series A preferred stock

	(in millions)
Outstanding shares at January 1, 2009		3.0	10.0	259.3
Shares issued		—	—	60.0
Treasury stock acquired		—	—	(0.3	)

Outstanding shares at December 31, 2009		3.0	10.0	319.0
Shares issued		—	—	1.5
Treasury stock acquired		—	—	(0.1	)

Outstanding shares at December 31, 2010		3.0	10.0	320.4
Shares issued		—	—	1.8
Treasury stock acquired		—	—	(21.1	)

Outstanding shares at December 31, 2011		3.0	10.0	301.1

On May 11, 2009, we issued 58.2 million shares of common stock at a price of $19.75 per share. Net proceeds from the issuance were $1,109.1 million. The proceeds from this offering were used for general corporate purposes.

In May 2011, our Board of Directors reinstated the November 2007 share repurchase program. In July 2011, we completed this program. During August 2011, our Board of Directors authorized a share repurchase program of up to $200.0 million of our outstanding common stock. We completed this program in September 2011. During November 2011, our Board of Directors authorized a share repurchase program of up to $100.0 million of our outstanding common stock. We completed this program in December 2011.

Our Board of Directors has authorized various repurchase programs under which we are allowed to purchase shares of our outstanding common stock. Shares repurchased under these programs are accounted for as treasury stock, carried at cost and reflected as a reduction to stockholders' equity.

Comprehensive income includes all changes in stockholders' equity during a period except those resulting from investments by stockholders and distributions to stockholders.

The components of accumulated other comprehensive income (loss) were as follows:

	Net unrealized losses on available-for-sale securities			Net unrealized gains on derivative instruments			Foreign currency translation adjustment			Unrecognized postretirement benefit obligations			Accumulated other comprehensive loss

	(in millions)
Balances at January 1, 2009	$	(4,208.0	)	$	37.2		$	(173.5	)	$	(567.3	)	$	(4,911.6	)
Net change in unrealized losses on fixed maturities, available-for-sale		6,590.8			—			—			—			6,590.8
Net change in noncredit component of impairment losses on fixed maturities, available-for-sale		(260.9	)		—			—			—			(260.9	)
Net change in unrealized losses on equity securities, available-for-sale		48.1			—			—			—			48.1
Net change in unrealized losses on equity method subsidiaries and noncontrolling interest adjustments		111.7			—			—			—			111.7
Adjustments for assumed changes in amortization pattern		(963.3	)		—			—			—			(963.3	)
Adjustment for assumed changes in policyholder liabilities		(79.0	)		—			—			—			(79.0	)
Net change in unrealized gains on derivative instruments		—			(33.2	)		—			—			(33.2	)
Change in net foreign currency translation adjustment		—			—			191.8			—			191.8
Change in unrecognized postretirement benefit obligations		—			—			—			263.3			263.3
Cumulative effect of reclassifying noncredit component of previously recognized impairment losses on fixed maturities, available-for-sale, net		(9.9	)		—			—			—			(9.9	)
Net change in provision for deferred income tax benefit (expense)		(1,884.3	)		10.3			(23.6	)		(92.2	)		(1,989.8	)

Balances at December 31, 2009	$	(654.8	)	$	14.3		$	(5.3	)	$	(396.2	)	$	(1,042.0	)

	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gains on derivative instruments			Foreign currency translation adjustment			Unrecognized postretirement benefit obligations			Accumulated other comprehensive income (loss)

	(in millions)
Balances at January 1, 2010	$	(654.8	)	$	14.3		$	(5.3	)	$	(396.2	)	$	(1,042.0	)
Net change in unrealized losses on fixed maturities, available-for-sale		2,315.1			—			—			—			2,315.1
Net change in noncredit component of impairment losses on fixed maturities, available-for-sale		(56.1	)		—			—			—			(56.1	)
Net change in unrealized losses on equity securities, available-for-sale		7.0			—			—			—			7.0
Net change in unrealized losses on equity method subsidiaries and noncontrolling interest adjustments		(68.9	)		—			—			—			(68.9	)
Adjustments for assumed changes in amortization pattern		(488.0	)		—			—			—			(488.0	)
Adjustment for assumed changes in policyholder liabilities		(136.7	)		—			—			—			(136.7	)
Net change in unrealized gains on derivative instruments		—			36.7			—			—			36.7
Change in net foreign currency translation adjustment		—			—			20.8			—			20.8
Change in unrecognized postretirement benefit obligations		—			—			—			320.0			320.0
Cumulative effect of implementation of accounting change related to variable interest entities, net		10.7			—			—			—			10.7
Cumulative effect of electing fair value option for fixed maturities upon implementation of accounting change related to embedded credit derivatives, net		25.4			—			—			—			25.4
Net change in provision for deferred income tax benefit (expense)		(558.3	)		(13.7	)		12.4			(112.0	)		(671.6	)

Balances at December 31, 2010	$	395.4		$	37.3		$	27.9		$	(188.2	)	$	272.4

	Net unrealized gains on available-for-sale securities			Net unrealized gains on derivative instruments			Foreign currency translation adjustment			Unrecognized postretirement benefit obligations			Accumulated other comprehensive income

	(in millions)
Balances at January 1, 2011	$	395.4		$	37.3		$	27.9		$	(188.2	)	$	272.4
Net change in unrealized gains on fixed maturities, available-for-sale		650.0			—			—			—			650.0
Net change in noncredit component of impairment losses on fixed maturities, available-for-sale		49.9			—			—			—			49.9
Net change in unrealized gains on equity securities, available-for-sale		12.3			—			—			—			12.3
Net change in unrealized gains on equity method subsidiaries and noncontrolling interest adjustments		9.1			—			—			—			9.1
Adjustments for assumed changes in amortization pattern		(167.6	)		—			—			—			(167.6	)
Adjustment for assumed changes in policyholder liabilities		(230.3	)		—			—			—			(230.3	)
Net change in unrealized gains on derivative instruments		—			60.2			—			—			60.2
Change in net foreign currency translation adjustment		—			—			(142.7	)		—			(142.7	)
Change in unrecognized postretirement benefit obligations		—			—			—			(266.0	)		(266.0	)
Net change in provision for deferred income tax benefit (expense)		(117.3	)		(21.2	)		—			93.1			(45.4	)

Balances at December 31, 2011	$	601.5		$	76.3		$	(114.8	)	$	(361.1	)	$	201.9

The following table sets forth the adjustments necessary to avoid duplication of items that are included as part of net income for a year that had been part of other comprehensive income in prior years:

	For the year ended December 31,

	2011			2010			2009
	(in millions)
Unrealized gains on available-for-sale securities and derivative instruments, as reported	$	245.1		$	1,073.2		$	3,530.3
Adjustment for realized losses on available-for-sale securities and derivative instruments included in net income		(117.8	)		(137.7	)		(215.8	)

Unrealized gains on available-for-sale securities and derivative instruments arising during the year	$	127.3		$	935.5		$	3,314.5

The above table includes unrealized gains (losses) on available-for-sale securities and derivatives in cash flow hedge relationships net of adjustments related to DPAC, sales inducements, unearned revenue reserves, changes in policyholder benefits and claims and applicable income taxes.

Under Iowa law, Principal Life may pay stockholder dividends only from the earned surplus arising from its business and must receive the prior approval of the Commissioner to pay a stockholder dividend if such a stockholder dividend would exceed certain statutory limitations. In general, the current statutory limitation is the greater of 10% of Principal Life's policyholder surplus as of the preceding year-end or the net gain from operations from the previous calendar year. Based on this limitation and 2011 statutory results, Principal Life could pay approximately $507.7 million in stockholder dividends in 2012 without exceeding the statutory limitation.

- Definition

The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure.

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+ Details