LINCOLN NATIONAL CORP - FORM 8-K - EX-99.2

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	Lincoln Financial Group
	Table of Contents


	Analyst Coverage and Credit Ratings	1
	Notes	2
	Consolidated
	Consolidated Statements of Income (Loss)	3
	Consolidated Balance Sheets	4
	Earnings, Shares and Return on Equity	5
	Key Stakeholder Metrics	6
	Segment and Sources of Earnings	7
	Select Earnings Drivers By Segment	8
	Sales By Segment	9
	Operating Revenues and General and Administrative Expenses By Segment	10
	Operating Commissions and Other Expenses	11
	Interest Rate Yields and Spreads By Segment	12
	Select Earnings and Operational Data from Business Segments
	Annuities	13
	Retirement Plan Services	14
	Life Insurance	15
	Group Protection	16
	Other Operations	17
	DAC & Account Value Rollforwards
	Consolidated DAC, VOBA, DSI and DFEL Roll Forwards	18
	Account Value Roll Forwards:
	Annuities	19
	Retirement Plan Services	20
	Life Insurance	21
	Other Information
	Select Investment Data	22
	Realized Gain (Loss) and Benefit Ratio Unlocking, After-DAC	23
	Select GAAP to Non-GAAP Reconciliations	24


Lincoln Financial Group
Analyst Coverage and Credit Ratings


Firm	Analyst				Phone Number
Autonomous Research U.S., L.P.	Erik Bass					646-561-6248
B. Riley FBR	Randy Binner					703-312-1890
Bank of America Merrill Lynch	Jay Cohen					646-855-5716
Citi Research	Suneet Kamath					212-816-3457
Credit Suisse	Andrew Kligerman					212-325-5069
Deutsche Bank	Joshua Shanker					212-250-7127
Dowling & Partners	Humphrey Lee					860-676-7324
Evercore	Thomas Gallagher					212-446-9439
Goldman Sachs	Alex Scott					917-343-7160
J.P. Morgan Securities	Jimmy Bhullar					212-622-6397
Keefe, Bruyette & Woods, Inc.	Ryan Krueger					860-722-5930
Morgan Stanley	Nigel Dally					212-761-4132
Piper Sandler & Co.	John Barnidge					312-281-3412
RBC Capital Markets	Mark Dwelle					804-782-4008
Wells Fargo	Elyse Greenspan					212-214-8031

This list is provided for informational purposes only. Lincoln Financial Group does not endorse the analyses, conclusions or recommendations contained in any report issued by these
or any other analysts.

		Ratings as of February 5, 2020
						Standard
		A.M Best	Fitch	Moody's		& Poor's
Senior Debt Ratings		a-	BBB+	Baa1		A-
Financial Strength Ratings
The Lincoln National Life Insurance Company		A+	A+	A1		AA-
First Penn-Pacific Life Insurance Company		A	A+	A1		A-
Lincoln Life & Annuity Company of New York		A+	A+	A1		AA-
Lincoln Life Assurance Company of Boston		A				AA-

Investor Inquiries May Be Directed To:
Chris Giovanni, Senior Vice President, Corporate Treasurer
Email: Christopher.Giovanni@lfg.com
Phone: 484-583-1793



Page 1

Lincoln Financial Group

Notes

Computations

• The quarterly financial information for the current year may not sum to the corresponding year-to-date amount as both are rounded to millions.

• The financial ratios reported herein are calculated using whole dollars instead of dollars rounded to millions.

• If the effect of equity classification would result in a more dilutive Earnings Per Share (“EPS”), the numerator used in the calculation of our diluted EPS is adjusted to remove the mark-to-market

adjustment for deferred units of LNC stock in our deferred compensation plans. In addition, for any period where a net loss is experienced, shares used in the diluted EPS calculation represent

basic shares, as the use of diluted shares would result in a lower loss per share.

• Return on equity (“ROE”) measures how efficiently we generate profits from the resources provided by our net assets. ROE is calculated by dividing annualized net income (loss) (or adjusted income (loss)

from operations) by average equity, excluding accumulated other comprehensive income (loss) (“AOCI”). Management evaluates consolidated ROE by both including and excluding the effect

of average goodwill.

• Book value per share, excluding AOCI, is calculated by dividing stockholders’ equity, excluding AOCI, by common shares outstanding. We provide book value per share, excluding AOCI, to enable

investors to analyze the amount of our net worth that is attributable primarily to our business operations. Management believes book value per share excluding AOCI is useful to investors because

it eliminates the effect of items that can fluctuate significantly from period to period, primarily based on changes in interest rates. Book value per share is the most directly comparable GAAP measure.

• Pre-tax net margin is calculated by dividing adjusted income (loss) from operations before taxes by net revenue, which is defined as total adjusted operating revenues less interest credited.

Definitions

Holding company available liquidity consists of cash and invested cash, excluding cash held as collateral, and certain short-term investments that can be readily converted into cash, net of commercial

paper outstanding.

Sales as reported consist of the following:

• Annuities and Retirement Plan Services – deposits from new and existing customers;

• MoneyGuard®, our linked-benefit product – 15% of total expected premium deposits;

• Universal life (“UL”), indexed universal life (“IUL”), variable universal life (“VUL”) – first-year commissionable premiums plus 5% of excess premiums received;

• Executive Benefits – single premium bank-owned UL and VUL, 15% of single premium deposits, and corporate-owned UL and VUL, first-year commissionable premiums plus 5% of excess

premium received;

• Term – 100% of annualized first-year premiums; and

• Group Protection – annualized first-year premiums from new policies.

Throughout the document, “after-DAC” refers to the associated amortization expense of deferred acquisition costs (“DAC”), value of business acquired (“VOBA”), deferred sales inducements (“DSI”)

and deferred front-end loads (“DFEL”) and changes in other contract holder funds.

Page 2a

Lincoln Financial Group

Notes

Sources of earnings are defined as follows:

• Investment spread earnings consist primarily of net investment income, net of interest credited earned on the underlying general account investments supporting our fixed products less related

expenses.

• Mortality/morbidity earnings result from mortality margins, morbidity margins, and certain expense assessments and related fees that are a function of the rates priced into the product and level

of insurance in force.

• Fees on assets under management (“AUM”) earnings results consist primarily of asset-based fees charged based on variable account values less associated benefits and related expenses.

• Variable annuity (“VA”) riders earnings consist of fees charged to the contract holder related to guaranteed benefit rider features, less the net valuation premium and associated change in

benefit reserves and related expenses.

Non-GAAP Performance Measures

Non-GAAP measures do not replace the most directly comparable GAAP measures, and we have included detailed reconciliations herein.

Adjusted income (loss) from operations is GAAP net income excluding the after-tax effects of the following items, as applicable:

• Realized gains and losses associated with the following (“excluded realized gain (loss)”):

▪ Sales or disposals and impairments of securities;

▪ Changes in the fair value of derivatives, embedded derivatives within certain reinsurance arrangements and trading securities (“gain (loss) on the mark-to-market on certain instruments”);

▪ Changes in the fair value of the derivatives we own to hedge our guaranteed death benefit (“GDB”) riders within our variable annuities;

▪ Changes in the fair value of the embedded derivatives of our guaranteed living benefit (“GLB”) riders reflected within variable annuity net derivative results accounted for at fair value;

▪ Changes in the fair value of the derivatives we own to hedge our GLB riders reflected within variable annuity net derivative results;

▪ Changes in the fair value of the embedded derivative liabilities related to index options we may purchase or sell in the future to hedge contract holder index allocations applicable to

future reset periods for our indexed annuity products accounted for at fair value (“indexed annuity forward-starting options”); and

▪ Changes in the fair value of equity securities;

• Changes in reserves resulting from benefit ratio unlocking on our GDB and GLB riders (“benefit ratio unlocking”);

• Income (loss) from reserve changes, net of related amortization, on business sold through reinsurance;

• Gains (losses) on early extinguishment of debt;

• Losses from the impairment of intangible assets;

• Income (loss) from discontinued operations;

• Acquisition and integration costs related to mergers and acquisitions; and

• Income (loss) from the initial adoption of new accounting standards, regulations and policy changes including the net impact from the Tax Cuts and Jobs Act.

Adjusted operating revenues represent GAAP revenues excluding the pre-tax effects of the following items, as applicable:

• Excluded realized gain (loss);

• Revenue adjustments from the initial adoption of new accounting standards;

• Amortization of DFEL arising from changes in GDB and GLB benefit ratio unlocking; and

• Amortization of deferred gains arising from reserve changes on business sold through reinsurance.

Page 2b

Lincoln Financial Group

Notes

Management believes that the non-GAAP performance measures previously discussed explain the results of our ongoing businesses in a manner that allows for a better understanding of the underlying

trends in our current business as the excluded items are unpredictable and not necessarily indicative of current operating fundamentals or future performance of the business segments, and, in many

instances, decisions regarding these items do not necessarily relate to the operations of the individual segments. In addition, we believe that our definitions of adjusted operating revenues and adjusted

income from operations provide investors with more valuable measures of our performance as they better reveal trends in our business.

Prior year interest rate spreads for the Life Insurance segment have been restated to conform to the current year presentation.

Due to reporting a net loss for the three months ended September 30, 2019, basic shares were used in the diluted earnings per share calculation for that period as the use of diluted shares would have

resulted in a lower loss per share.

Statistical Supplement is Dated

The financial data in this document is dated February 5, 2020, and has not been updated since that date. Lincoln Financial Group does not intend to update this document.

Page 2c


Lincoln Financial Group
Consolidated Statements of Income (Loss)
Unaudited (millions of dollars, except per share data)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Revenues
Insurance premiums	$	1,336	$	1,446	$	1,398	$	1,325	$	1,344	0.6%	$	4,601	$	5,513	19.8%
Fee income		1,511		1,475		1,517		1,934		1,572	4.0%		5,986		6,497	8.5%
Net investment income		1,349		1,251		1,355		1,235		1,381	2.4%		5,085		5,223	2.7%
Realized gain (loss):
Other-than-temporary impairment (“OTTI”)		(2)		(8)		(4)		(2)		(1)	50.0%		(7)		(15)	NM
Realized gain (loss), excluding OTTI		193		(354)		(113)		(9)		(118)	NM		148		(595)	NM
Total realized gain (loss)		191		(362)		(117)		(11)		(119)	NM		141		(610)	NM
Amortization of deferred gains on business
sold through reinsurance		8		8		8		8		7	-12.5%		9		31	244.4%
Other revenues		136		147		149		147		159	16.9%		602		604	0.3%
Total revenues		4,531		3,965		4,310		4,638		4,344	-4.1%		16,424		17,258	5.1%

Expenses
Interest credited		663		678		680		705		717	8.1%		2,617		2,780	6.2%
Benefits		2,142		1,757		1,852		2,502		1,768	-17.5%		6,786		7,880	16.1%
Commissions and other expenses		1,162		1,176		1,272		1,552		1,288	10.8%		4,763		5,287	11.0%
Interest and debt expense		69		71		70		113		72	4.3%		297		326	9.8%
Strategic digitization expense		28		15		15		16		18	-35.7%		76		66	-13.2%
Total expenses		4,064		3,697		3,889		4,888		3,863	-4.9%		14,539		16,339	12.4%
Income (loss) before taxes		467		268		421		(250)		481	3.0%		1,885		919	-51.2%
Federal income tax expense (benefit)		68		16		58		(89)		50	-26.5%		244		33	-86.5%
Net income (loss)		399		252		363		(161)		431	8.0%		1,641		886	-46.0%
Adjustment for LNC stock units in our
deferred compensation plans		(12)		-		-		(3)		(1)	91.7%		(18)		-	100.0%
Net income (loss) available to common
stockholders – diluted	$	387	$	252	$	363	$	(164)	$	430	11.1%	$	1,623	$	886	-45.4%

Earnings (Loss) Per Common Share – Diluted
Net income (loss)	$	1.80	$	1.22	$	1.79	$	(0.83)	$	2.15	19.4%	$	7.40	$	4.38	-40.8%

ROE, including AOCI
Net income (loss)		10.9%		6.6%		8.3%		-3.4%		8.7%			10.6%		4.9%



Page 3


Lincoln Financial Group
Consolidated Balance Sheets
Unaudited (millions of dollars)

	As of
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change
ASSETS
Investments:
Fixed maturity available-for-sale (“AFS”) securities:
Corporate bonds	$	80,348	$	83,208	$	84,790	$	87,910	$	88,716	10.4%
U.S. government bonds		417		423		430		438		435	4.3%
State and municipal bonds		5,345		5,569		5,669		5,800		5,884	10.1%
Foreign government bonds		448		453		440		444		393	-12.3%
Residential mortgage-backed securities		3,373		3,414		3,292		3,287		3,241	-3.9%
Commercial mortgage-backed securities		804		885		965		1,033		1,083	34.7%
Asset-backed securities		2,696		3,484		3,542		4,172		4,889	81.3%
Hybrid and redeemable preferred securities		593		614		605		575		559	-5.7%
Total fixed maturity AFS securities		94,024		98,050		99,733		103,659		105,200	11.9%
Trading securities		1,950		3,314		4,522		4,691		4,673	139.6%
Equity securities		99		153		196		158		103	4.0%
Mortgage loans on real estate		13,260		13,997		15,090		15,947		16,339	23.2%
Policy loans		2,509		2,498		2,484		2,475		2,477	-1.3%
Derivative investments		1,107		981		1,510		2,201		1,911	72.6%
Other investments		2,267		2,752		2,845		3,389		2,994	32.1%
Total investments		115,216		121,745		126,380		132,520		133,697	16.0%
Cash and invested cash		2,345		1,593		3,314		2,939		2,563	9.3%
DAC and VOBA		10,264		9,441		8,588		7,492		7,694	-25.0%
Premiums and fees receivable		570		607		553		440		465	-18.4%
Accrued investment income		1,119		1,184		1,146		1,182		1,148	2.6%
Reinsurance recoverables		17,748		17,660		17,481		17,353		17,144	-3.4%
Funds withheld reinsurance assets		557		549		548		543		536	-3.8%
Goodwill		1,782		1,778		1,778		1,778		1,778	-0.2%
Other assets		15,713		16,373		16,196		15,939		16,170	2.9%
Separate account assets		132,833		143,369		146,275		145,092		153,566	15.6%
Total assets	$	298,147	$	314,299	$	322,259	$	325,278	$	334,761	12.3%






Page 4a


Lincoln Financial Group
Consolidated Balance Sheets
Unaudited (millions of dollars)

	As of
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Future contract benefits	$	34,648	$	34,009	$	34,890	$	36,108	$	36,420	5.1%
Other contract holder funds		91,233		93,959		94,947		95,283		98,018	7.4%
Short-term debt		-		300		300		300		300	NM
Long-term debt by rating agency leverage definitions:
Operating (see note (2) on page 6 for details)		866		866		866		866		866	0.0%
Financial		4,973		4,706		4,755		5,204		5,201	4.6%
Reinsurance related embedded derivatives		3		177		310		339		327	NM
Funds withheld reinsurance liabilities		1,740		1,762		1,796		1,817		1,810	4.0%
Payables for collateral on investments		4,805		5,362		5,632		5,528		5,082	5.8%
Other liabilities		12,696		13,372		14,033		14,742		13,482	6.2%
Separate account liabilities		132,833		143,369		146,275		145,092		153,566	15.6%
Total liabilities		283,797		297,882		303,804		305,279		315,072	11.0%

Stockholders’ Equity
Common stock		5,392		5,285		5,241		5,192		5,162	-4.3%
Retained earnings		8,551		8,679		8,878		8,559		8,854	3.5%
AOCI:
Unrealized investment gains (losses)		729		2,773		4,658		6,572		6,017	NM
Foreign currency translation adjustment		(23)		(20)		(24)		(29)		(17)	26.1%
Funded status of employee benefit plans		(299)		(300)		(298)		(295)		(327)	-9.4%
Total AOCI		407		2,453		4,336		6,248		5,673	NM
Total stockholders’ equity		14,350		16,417		18,455		19,999		19,689	37.2%
Total liabilities and stockholders’ equity	$	298,147	$	314,299	$	322,259	$	325,278	$	334,761	12.3%










Page 4b


Lincoln Financial Group
Earnings, Shares and Return on Equity
Unaudited (millions of dollars, except per share data)

	As of or For the Three Months Ended											As of or For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Income (Loss)
Net income (loss)	$	399	$	252	$	363	$	(161)	$	431	8.0%	$	1,641	$	886	-46.0%
Pre-tax adjusted income (loss) from operations		563		507		566		(104)		566	0.5%		2,212		1,535	-30.6%
After-tax adjusted income (loss) from operations (1)		475		441		478		(46)		482	1.5%		1,880		1,355	-27.9%
Adjusted operating tax rate		15.6%		13.0%		15.5%		55.8%		14.8%			15.0%		11.7%

Average Stockholders’ Equity
Average equity, including AOCI	$	14,710	$	15,384	$	17,436	$	19,227	$	19,844	34.9%	$	15,517	$	17,973	15.8%
Average AOCI		622		1,430		3,394		5,292		5,961	NM		1,602		4,019	150.9%
Average equity, excluding AOCI	$	14,088	$	13,954	$	14,042	$	13,935	$	13,883	-1.5%	$	13,915	$	13,954	0.3%

ROE, Excluding AOCI
Net income (loss)		11.3%		7.2%		10.4%		-4.6%		12.4%			11.8%		6.3%
Adjusted income (loss) from operations		13.5%		12.6%		13.6%		-1.3%		13.9%			13.5%		9.7%

Per Share
Net income (loss) (diluted)	$	1.80	$	1.22	$	1.79	$	(0.83)	$	2.15	19.4%	$	7.40	$	4.38	-40.8%
Adjusted income (loss) from operations (diluted)		2.15		2.14		2.36		(0.25)		2.41	12.1%		8.48		6.71	-20.9%
Dividends declared during the period		0.37		0.37		0.37		0.37		0.40	8.1%		1.36		1.51	11.0%

Book value, including AOCI	$	69.71	$	80.88	$	91.92	$	100.84	$	100.11	43.6%	$	69.71	$	100.11	43.6%
Per share impact of AOCI		1.98		12.09		21.60		31.51		28.84	NM		1.98		28.84	NM
Book value, excluding AOCI	$	67.73	$	68.79	$	70.32	$	69.33	$	71.27	5.2%	$	67.73	$	71.27	5.2%

Shares
Repurchased during the period		9.1		3.9		2.3		2.5		1.7	-81.3%		13.2		10.4	-21.2%
End-of-period – basic		205.9		203.0		200.8		198.3		196.7	-4.5%		205.9		196.7	-4.5%
End-of-period – diluted		209.0		204.2		202.2		200.7		199.2	-4.7%		209.0		199.2	-4.7%
Average for the period – diluted		215.0		206.0		202.9		201.6		200.0	-7.0%		219.6		202.1	-8.0%

(1) See reconciliation to net income (loss) on page 24.




Page 5


Lincoln Financial Group
Key Stakeholder Metrics
Unaudited (millions of dollars, except per share data)

	As of or For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Cash Returned to Common Stockholders
Shares repurchased	$	535	$	240	$	150	$	150	$	100	-81.3%	$	810	$	640	-21.0%
Common dividends		70		76		75		74		73	4.3%		286		298	4.2%
Total cash returned to common stockholders	$	605	$	316	$	225	$	224	$	173	-71.4%	$	1,096	$	938	-14.4%

Leverage Ratio
Short-term debt	$	-	$	300	$	300	$	300	$	300	NM
Long-term debt		5,839		5,572		5,621		6,070		6,067	3.9%
Total debt (1)		5,839		5,872		5,921		6,370		6,367	9.0%
Less:
Operating debt (2)		866		866		866		866		866	0.0%
25% of capital securities		302		302		302		302		302	0.0%
Carrying value of fair value hedges and other items		189		222		270		331		278	47.1%
Total numerator	$	4,482	$	4,482	$	4,483	$	4,871	$	4,921	9.8%

Stockholders’ equity, excluding unrealized
investment gains (losses)	$	13,621	$	13,644	$	13,797	$	13,427	$	13,672	0.4%
Add: 25% of capital securities		302		302		302		302		302	0.0%
Total numerator		4,482		4,482		4,483		4,871		4,921	9.8%
Total denominator	$	18,405	$	18,428	$	18,582	$	18,600	$	18,895	2.7%

Leverage ratio		24.4%		24.3%		24.1%		26.2%		26.0%

Holding Company Available Liquidity	$	465	$	481	$	474	$	765	$	702	51.0%

(1) Excludes obligations under finance leases and certain financing arrangements of $388 million that are reported in other liabilities on our Consolidated Balance Sheets.
(2) We have categorized as operating debt the senior notes issued in October 2007 and June 2010 because the proceeds were used as a long-term structured solution to reduce the strain
on increasing statutory reserves associated with secondary guarantee UL and term policies.







Page 6


Lincoln Financial Group
Segment and Sources of Earnings
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Income (Loss) from Operations, Pre-Tax
Annuities	$	300	$	287	$	309	$	185	$	312	4.0%	$	1,285	$	1,093	-14.9%
Retirement Plan Services		54		43		49		49		54	0.0%		200		195	-2.5%
Life Insurance		218		195		207		(318)		222	1.8%		792		306	-61.4%
Group Protection		64		70		86		78		68	6.3%		237		301	27.0%
Other Operations		(73)		(88)		(85)		(98)		(90)	-23.3%		(302)		(360)	-19.2%
Adjusted income (loss) from operations, before
income taxes	$	563	$	507	$	566	$	(104)	$	566	0.5%	$	2,212	$	1,535	-30.6%

Income (Loss) from Operations, After-Tax
Annuities	$	258	$	250	$	266	$	169	$	269	4.3%	$	1,102	$	954	-13.4%
Retirement Plan Services		45		39		42		44		47	4.4%		171		172	0.6%
Life Insurance		175		157		168		(245)		179	2.3%		645		259	-59.8%
Group Protection		50		55		68		61		54	8.0%		187		238	27.3%
Other Operations		(53)		(60)		(66)		(75)		(67)	-26.4%		(225)		(268)	-19.1%
Adjusted income (loss) from operations	$	475	$	441	$	478	$	(46)	$	482	1.5%	$	1,880	$	1,355	-27.9%

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Sources of Earnings, Pre-Tax
Investment spread	$	161	$	151	$	164	$	(126)	$	173	7.5%	$	664	$	363	-45.3%
Mortality/morbidity		182		179		196		(119)		189	3.8%		669		446	-33.3%
Fees on AUM		274		243		269		262		275	0.4%		1,042		1,046	0.4%
VA riders		19		22		22		(23)		19	0.0%		139		40	-71.2%
Total sources of earnings, before income taxes		636		595		651		(6)		656	3.1%		2,514		1,895	-24.6%
Other Operations		(73)		(88)		(85)		(98)		(90)	-23.3%		(302)		(360)	-19.2%
Adjusted income (loss) from operations, before
income taxes	$	563	$	507	$	566	$	(104)	$	566	0.5%	$	2,212	$	1,535	-30.6%

Sources of Earnings, Pre-Tax, Percentage By Component
Investment spread		25.4%		25.5%		25.2%		1829.1%		26.4%			26.4%		19.2%
Mortality/morbidity		28.5%		30.1%		30.2%		1720.6%		28.8%			26.7%		23.5%
Fees on AUM		43.0%		40.7%		41.1%		-3785.1%		42.0%			41.4%		55.2%
VA riders		3.1%		3.7%		3.5%		335.4%		2.8%			5.5%		2.1%
Total		100.0%		100.0%		100.0%		100.0%		100.0%			100.0%		100.0%

Page 7

Lincoln Financial Group
Select Earnings Drivers By Segment
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Annuities
Operating revenues	$	1,086	$	1,174	$	1,156	$	1,117	$	1,153	6.2%	$	4,383	$	4,600	5.0%
Deposits		3,774		3,508		3,654		3,461		3,902	3.4%		12,363		14,525	17.5%
Net flows		675		492		377		253		729	8.0%		(139)		1,851	NM
Average account values		124,869		127,185		131,675		133,922		137,817	10.4%		134,186		132,695	-1.1%

Retirement Plan Services
Operating revenues	$	300	$	293	$	299	$	298	$	310	3.3%	$	1,178	$	1,200	1.9%
Deposits		2,163		2,496		2,073		2,234		2,663	23.1%		10,068		9,465	-6.0%
Net flows		173		(381)		307		272		422	143.9%		2,546		620	-75.6%
Average account values		69,518		69,977		72,612		74,201		76,478	10.0%		69,325		73,292	5.7%

Life Insurance
Operating revenues	$	1,815	$	1,700	$	1,802	$	2,098	$	1,838	1.3%	$	6,922	$	7,438	7.5%
Deposits		1,863		1,537		1,683		1,685		2,413	29.5%		6,438		7,320	13.7%
Net flows		1,439		1,020		1,217		1,227		1,957	36.0%		4,679		5,422	15.9%
Average account values		50,088		50,355		51,495		52,050		53,243	6.3%		49,751		51,786	4.1%
Average in-force face amount		740,047		753,441		772,231		790,667		814,865	10.1%		730,856		782,801	7.1%

Group Protection
Operating revenues	$	1,139	$	1,138	$	1,155	$	1,137	$	1,158	1.7%	$	3,757	$	4,588	22.1%
Insurance premiums		1,018		1,023		1,032		1,024		1,035	1.7%		3,383		4,113	21.6%

Consolidated
Adjusted operating revenues (1)	$	4,394	$	4,362	$	4,470	$	4,700	$	4,513	2.7%	$	16,475	$	18,046	9.5%
Deposits		7,800		7,541		7,410		7,380		8,978	15.1%		28,869		31,310	8.5%
Net flows		2,287		1,131		1,901		1,752		3,108	35.9%		7,086		7,893	11.4%
Average account values		244,475		247,517		255,782		260,173		267,538	9.4%		253,262		257,773	1.8%

(1) See reconciliation to total revenues on page 24.





Page 8


Lincoln Financial Group
Sales By Segment
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Sales
Annuities:
With guaranteed living benefits	$	1,347	$	1,060	$	1,241	$	1,243	$	1,428	6.0%	$	5,707	$	4,972	-12.9%
Without guaranteed living benefits		1,122		864		1,115		1,191		1,298	15.7%		3,080		4,468	45.1%
Variable		2,469		1,924		2,356		2,434		2,726	10.4%		8,787		9,440	7.4%
Fixed		1,305		1,584		1,298		1,027		1,176	-9.9%		3,576		5,085	42.2%
Total Annuities	$	3,774	$	3,508	$	3,654	$	3,461	$	3,902	3.4%	$	12,363	$	14,525	17.5%

Retirement Plan Services:
First-year sales	$	835	$	829	$	610	$	723	$	1,227	46.9%	$	4,453	$	3,388	-23.9%
Recurring deposits		1,328		1,667		1,463		1,511		1,436	8.1%		5,615		6,077	8.2%
Total Retirement Plan Services	$	2,163	$	2,496	$	2,073	$	2,234	$	2,663	23.1%	$	10,068	$	9,465	-6.0%

Life Insurance:
UL	$	14	$	11	$	15	$	11	$	20	42.9%	$	43	$	57	32.6%
MoneyGuard®		58		51		56		67		124	113.8%		226		298	31.9%
IUL		22		16		25		37		76	245.5%		62		155	150.0%
VUL		103		52		53		54		107	3.9%		268		265	-1.1%
Term		33		30		37		37		39	18.2%		113		144	27.4%
Total individual life insurance		230		160		186		206		366	59.1%		712		919	29.1%
Executive Benefits		32		31		24		28		81	153.1%		52		163	213.5%
Total Life Insurance	$	262	$	191	$	210	$	234	$	447	70.6%	$	764	$	1,082	41.6%

Group Protection:
Life	$	100	$	64	$	42	$	131	$	108	8.0%	$	222	$	344	55.0%
Disability		123		42		40		96		140	13.8%		257		319	24.1%
Dental		49		13		13		15		49	0.0%		101		89	-11.9%
Total Group Protection	$	272	$	119	$	95	$	242	$	297	9.2%	$	580	$	752	29.7%
Percent employee-paid		42.1%		52.6%		45.8%		41.5%		37.6%			42.2%		42.3%






Page 9


Lincoln Financial Group
Operating Revenues and General and Administrative Expenses By Segment
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Operating Revenues
Annuities	$	1,086	$	1,174	$	1,156	$	1,117	$	1,153	6.2%	$	4,383	$	4,600	5.0%
Retirement Plan Services		300		293		299		298		310	3.3%		1,178		1,200	1.9%
Life Insurance		1,815		1,700		1,802		2,098		1,838	1.3%		6,922		7,438	7.5%
Group Protection		1,139		1,138		1,155		1,137		1,158	1.7%		3,757		4,588	22.1%
Other Operations		54		57		58		50		54	0.0%		235		220	-6.4%
Total adjusted operating revenues	$	4,394	$	4,362	$	4,470	$	4,700	$	4,513	2.7%	$	16,475	$	18,046	9.5%

General and Administrative Expenses,
Net of Amounts Capitalized (1)
Annuities		120	$	117	$	126	$	118	$	132	10.0%	$	463	$	493	6.5%
Retirement Plan Services		78		75		76		73		78	0.0%		304		302	-0.7%
Life Insurance		121		121		131		123		145	19.8%		471		521	10.6%
Group Protection		166		156		167		162		174	4.8%		559		656	17.4%
Other Operations		33		40		37		25		43	30.3%		122		146	19.7%
Total	$	518	$	509	$	537	$	501	$	572	10.4%	$	1,919	$	2,118	10.4%

General and Administrative Expenses,
Net of Amounts Capitalized, as a Percentage
of Operating Revenues
Annuities		11.1%		10.0%		10.9%		10.6%		11.4%			10.6%		10.7%
Retirement Plan Services		25.8%		25.5%		25.4%		24.6%		25.3%			25.8%		25.2%
Life Insurance		6.7%		7.1%		7.3%		5.9%		7.9%			6.8%		7.0%
Group Protection		14.6%		13.7%		14.4%		14.1%		15.0%			14.9%		14.3%
Other Operations		59.8%		69.9%		64.3%		49.6%		81.8%			52.4%		66.6%
Total		11.8%		11.7%		12.0%		10.7%		12.7%			11.6%		11.7%

(1) See page 11 for general and administrative expenses capitalized.







Page 10


Lincoln Financial Group
Operating Commissions and Other Expenses
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Operating Commissions and
Other Expenses Incurred
General and administrative expenses	$	591	$	563	$	593	$	569	$	663	12.2%	$	2,137	$	2,388	11.7%
Commissions		737		649		689		707		867	17.6%		2,606		2,912	11.7%
Taxes, licenses and fees		80		100		74		86		87	8.8%		320		348	8.8%
Interest and debt expense		69		71		70		71		72	4.3%		274		284	3.6%
Expenses associated with reserve financing
and unrelated letters of credit		22		22		22		22		23	4.5%		84		88	4.8%
Total adjusted operating commissions and other
expenses incurred		1,499		1,405		1,448		1,455		1,712	14.2%		5,421		6,020	11.0%

Less Amounts Capitalized
General and administrative expenses		(73)		(54)		(56)		(68)		(91)	-24.7%		(218)		(270)	-23.9%
Commissions		(406)		(326)		(348)		(374)		(523)	-28.8%		(1,300)		(1,569)	-20.7%
Taxes, licenses and fees		(59)		(15)		(15)		(14)		(26)	55.9%		(88)		(69)	21.6%
Total amounts capitalized		(538)		(395)		(419)		(456)		(640)	-19.0%		(1,606)		(1,908)	-18.8%
Total expenses incurred, net of amounts
capitalized, excluding amortization		961		1,010		1,029		999		1,072	11.6%		3,815		4,112	7.8%

Amortization
Amortization of DAC, VOBA and other intangibles		308		209		280		601		261	-15.3%		1,250		1,351	8.1%
Total adjusted operating commissions and
other expenses	$	1,269	$	1,219	$	1,309	$	1,600	$	1,333	5.0%	$	5,065	$	5,463	7.9%












Page 11


Lincoln Financial Group
Interest Rate Yields and Spreads By Segment
Unaudited

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Annuities
Earned rate on reserves		3.92%		3.97%		4.09%		4.04%		3.84%	(8)		3.88%		3.98%	10
Variable investment income on reserves (1)		0.07%		0.05%		0.09%		0.09%		0.20%	13		0.10%		0.11%	1
Net investment income yield on reserves		3.99%		4.02%		4.18%		4.13%		4.04%	5		3.98%		4.09%	11
Interest rate credited to contract holders		2.31%		2.41%		2.35%		2.46%		2.47%	16		2.27%		2.42%	15
Interest rate spread		1.68%		1.61%		1.83%		1.67%		1.57%	(11)		1.71%		1.67%	(4)
Base spreads excluding variable investment income		1.61%		1.56%		1.74%		1.58%		1.37%	(24)		1.61%		1.56%	(5)

Retirement Plan Services
Earned rate on reserves		4.20%		4.18%		4.13%		4.13%		4.07%	(13)		4.23%		4.13%	(10)
Variable investment income on reserves (1)		0.06%		0.05%		0.07%		0.16%		0.24%	18		0.09%		0.13%	4
Net investment income yield on reserves		4.26%		4.23%		4.20%		4.29%		4.31%	5		4.32%		4.26%	(6)
Interest rate credited to contract holders		2.89%		2.92%		2.90%		2.90%		2.89%	-		2.90%		2.90%	-
Interest rate spread		1.37%		1.31%		1.30%		1.39%		1.42%	5		1.42%		1.36%	(6)
Base spreads excluding variable investment income		1.31%		1.26%		1.23%		1.23%		1.18%	(13)		1.33%		1.23%	(10)

Life Insurance – Interest-Sensitive
Earned rate on reserves		4.92%		4.85%		4.87%		4.86%		4.84%	(8)		4.93%		4.85%	(8)
Variable investment income on reserves (1)		0.61%		0.06%		0.46%		-0.38%		0.33%	(28)		0.36%		0.12%	(24)
Net investment income yield on reserves		5.53%		4.91%		5.33%		4.48%		5.17%	(36)		5.29%		4.97%	(32)
Interest rate credited to contract holders		3.73%		3.69%		3.68%		3.71%		3.71%	(2)		3.73%		3.70%	(3)
Interest rate spread		1.80%		1.22%		1.65%		0.77%		1.46%	(34)		1.56%		1.27%	(29)
Base spreads excluding variable investment income		1.19%		1.16%		1.19%		1.15%		1.13%	(6)		1.20%		1.15%	(5)

Total (2)
Earned rate (3)		4.43%		4.33%		4.35%		4.39%		4.33%	(10)		4.44%		4.35%	(9)
Variable investment income (1) (3)		0.43%		0.06%		0.32%		-0.19%		0.28%	(15)		0.28%		0.12%	(16)
Net investment income yield (3)		4.86%		4.39%		4.67%		4.20%		4.61%	(25)		4.72%		4.47%	(25)

(1) Variable investment income consists of commercial mortgage loan prepayment and bond make-whole premiums and investment income on alternative investments.
(2) Includes the results of all of our business segments and Other Operations.
(3) Includes investment yields on reserves and surplus.





Page 12


Lincoln Financial Group
Annuities – Select Earnings and Operational Data
Unaudited (millions of dollars)

	As of or For the Three Months Ended											As of or For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Income (Loss) from Operations
Operating revenues:
Insurance premiums	$	108	$	208	$	137	$	79	$	78	-27.8%	$	390	$	502	28.7%
Fee income		571		568		586		596		606	6.1%		2,342		2,357	0.6%
Net investment income		261		257		286		287		309	18.4%		1,005		1,140	13.4%
Operating realized gain (loss)		50		41		46		51		53	6.0%		192		190	-1.0%
Amortization of deferred gain		8		8		8		8		7	-12.5%		8		30	275.0%
Other revenues		88		92		93		96		100	13.6%		446		381	-14.6%
Total operating revenues		1,086		1,174		1,156		1,117		1,153	6.2%		4,383		4,600	5.0%
Operating expenses:
Interest credited		150		162		163		183		190	26.7%		587		698	18.9%
Benefits		196		284		219		273		163	-16.8%		673		938	39.4%
Commissions incurred		291		268		287		295		322	10.7%		1,078		1,171	8.6%
Other expenses incurred		241		230		244		240		257	6.6%		928		973	4.8%
Amounts capitalized		(176)		(147)		(161)		(175)		(198)	-12.5%		(578)		(681)	-17.8%
Amortization		84		90		95		116		107	27.4%		410		408	-0.5%
Total operating expenses		786		887		847		932		841	7.0%		3,098		3,507	13.2%
Income (loss) from operations before taxes		300		287		309		185		312	4.0%		1,285		1,093	-14.9%
Federal income tax expense (benefit)		42		37		43		16		43	2.4%		183		139	-24.0%
Income (loss) from operations	$	258	$	250	$	266	$	169	$	269	4.3%	$	1,102	$	954	-13.4%

Effective Federal Income Tax Rate		13.8%		12.8%		13.9%		8.4%		13.9%			14.2%		12.7%

Average Equity, Excluding Goodwill and AOCI	$	5,000	$	4,785	$	4,741	$	4,846	$	4,883	-2.3%	$	5,000	$	4,814	-3.7%

ROE, Excluding Goodwill and AOCI		20.7%		20.9%		22.5%		14.0%		22.0%			22.0%		19.8%

Return on Average Account Values		83		79		81		51		78	(5)		82		72	(10)

Income (Loss) from Operations
Variable annuity		232		214		232		198		233	0.4%		940		877	-6.7%
Fixed annuity		26		36		34		(29)		36	38.5%		162		77	-52.5%

Account Values
Variable annuity account values:
Average	$	112,615	$	113,785	$	117,254	$	118,680	$	121,632	8.0%	$	116,840	$	117,879	0.9%
End-of-period		108,536		116,514		119,005		118,424		125,492	15.6%		108,536		125,492	15.6%
Fixed annuity account values:
Average		12,254		13,400		14,421		15,242		16,185	32.1%		17,346		14,816	-14.6%
End-of-period		12,743		13,944		14,839		15,611		16,636	30.6%		12,743		16,636	30.6%

Page 13


Lincoln Financial Group
Retirement Plan Services – Select Earnings and Operational Data
Unaudited (millions of dollars)

	As of or For the Three Months Ended											As of or For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Income (Loss) from Operations
Operating revenues:
Fee income	$	62	$	61	$	62	$	63	$	66	6.5%	$	256	$	252	-1.6%
Net investment income		232		226		231		229		239	3.0%		899		924	2.8%
Other revenues		6		6		6		6		5	-16.7%		23		24	4.3%
Total operating revenues		300		293		299		298		310	3.3%		1,178		1,200	1.9%
Operating expenses:
Interest credited		142		145		145		147		148	4.2%		555		585	5.4%
Benefits		-		-		1		1		1	NM		2		2	0.0%
Commissions incurred		18		19		19		20		20	11.1%		78		79	1.3%
Other expenses incurred		86		85		83		80		86	0.0%		337		336	-0.3%
Amounts capitalized		(6)		(5)		(5)		(5)		(7)	-16.7%		(22)		(23)	-4.5%
Amortization		6		6		7		6		8	33.3%		28		26	-7.1%
Total operating expenses		246		250		250		249		256	4.1%		978		1,005	2.8%
Income (loss) from operations before taxes		54		43		49		49		54	0.0%		200		195	-2.5%
Federal income tax expense (benefit)		9		4		7		5		7	-22.2%		29		23	-20.7%
Income (loss) from operations	$	45	$	39	$	42	$	44	$	47	4.4%	$	171	$	172	0.6%

Effective Federal Income Tax Rate		15.9%		8.5%		14.3%		9.3%		13.7%			14.6%		11.6%

Average Equity, Excluding Goodwill and AOCI	$	1,356	$	1,402	$	1,429	$	1,447	$	1,440	6.2%	$	1,322	$	1,430	8.2%

ROE, Excluding Goodwill and AOCI		13.3%		11.2%		11.7%		12.2%		13.0%			12.9%		12.1%

Pre-tax Net Margin		34.0%		29.1%		31.7%		32.4%		33.6%			32.1%		31.7%

Return on Average Account Values		26		22		23		24		25	(1)		25		24	(1)

Net Flows by Market
Small Market		248		189		25		117		118	-52.4%	$	290	$	449	54.8%
Mid - Large Market		264		(283)		532		436		651	146.6%		3,401		1,336	-60.7%
Multi-Fund® and Other		(339)		(287)		(250)		(281)		(347)	-2.4%		(1,145)		(1,165)	-1.7%

Net Flows – Trailing Twelve Months	$	2,546	$	1,702	$	1,510	$	371	$	620	-75.6%	$	2,546	$	620	-75.6%





Page 14


Lincoln Financial Group
Life Insurance – Select Earnings and Operational Data
Unaudited (millions of dollars)

	As of or For the Three Months Ended											As of or For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Income (Loss) from Operations
Operating revenues:
Insurance premiums	$	210	$	213	$	224	$	219	$	228	8.6%	$	817	$	885	8.3%
Fee income		881		844		868		1,275		898	1.9%		3,392		3,882	14.4%
Net investment income		719		643		707		601		706	-1.8%		2,697		2,658	-1.4%
Operating realized gain (loss)		-		(3)		(2)		(1)		(1)	NM		(5)		(6)	-20.0%
Other revenues		5		3		5		4		7	40.0%		21		19	-9.5%
Total operating revenues		1,815		1,700		1,802		2,098		1,838	1.3%		6,922		7,438	7.5%
Operating expenses:
Interest credited		357		354		355		360		364	2.0%		1,414		1,433	1.3%
Benefits		913		902		913		1,426		942	3.2%		3,345		4,183	25.1%
Commissions incurred		241		186		197		212		337	39.8%		760		931	22.5%
Other expenses incurred		210		212		214		215		256	21.9%		811		896	10.5%
Amounts capitalized		(318)		(220)		(232)		(246)		(397)	-24.8%		(914)		(1,094)	-19.7%
Amortization		194		71		148		449		114	-41.2%		714		783	9.7%
Total operating expenses		1,597		1,505		1,595		2,416		1,616	1.2%		6,130		7,132	16.3%
Income (loss) from operations before taxes		218		195		207		(318)		222	1.8%		792		306	-61.4%
Federal income tax expense (benefit)		43		38		39		(73)		43	0.0%		147		47	-68.0%
Income (loss) from operations	$	175	$	157	$	168	$	(245)	$	179	2.3%	$	645	$	259	-59.8%

Effective Federal Income Tax Rate		19.8%		19.6%		19.1%		22.9%		19.2%			18.5%		15.6%

Average Equity, Excluding Goodwill and AOCI	$	8,147	$	8,399	$	8,697	$	8,601	$	8,502	4.4%	$	7,994	$	8,550	7.0%

ROE, Excluding Goodwill and AOCI		8.6%		7.5%		7.7%		-11.4%		8.4%			8.1%		3.0%

Average Account Values	$	50,088	$	50,355	$	51,495	$	52,050	$	53,243	6.3%	$	49,751	$	51,786	4.1%

In-Force Face Amount
UL and other	$	343,922	$	346,292	$	347,674	$	348,836	$	357,726	4.0%	$	343,922	$	357,726	4.0%
Term insurance		399,877		416,789		433,706		451,117		472,050	18.0%		399,877		472,050	18.0%
Total in-force face amount	$	743,799	$	763,081	$	781,380	$	799,953	$	829,776	11.6%	$	743,799	$	829,776	11.6%






Page 15


Lincoln Financial Group
Group Protection – Select Earnings and Operational Data
Unaudited (millions of dollars)

	For the Three Months Ended											As of For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Income (Loss) from Operations
Operating revenues:
Insurance premiums	$	1,018	$	1,023	$	1,032	$	1,024	$	1,035	1.7%	$	3,383	$	4,113	21.6%
Net investment income		80		74		81		72		81	1.3%		260		307	18.1%
Other revenues		41		41		42		41		42	2.4%		114		168	47.4%
Total operating revenues		1,139		1,138		1,155		1,137		1,158	1.7%		3,757		4,588	22.1%
Operating expenses:
Interest credited		2		1		1		2		1	-50.0%		5		5	0.0%
Benefits		769		753		758		756		768	-0.1%		2,455		3,036	23.7%
Commissions incurred		101		92		92		88		95	-5.9%		339		367	8.3%
Other expenses incurred		218		203		208		212		232	6.4%		717		855	19.2%
Amounts capitalized		(39)		(23)		(20)		(29)		(38)	2.6%		(94)		(110)	-17.0%
Amortization		24		42		30		30		32	33.3%		98		134	36.7%
Total operating expenses		1,075		1,068		1,069		1,059		1,090	1.4%		3,520		4,287	21.8%
Income (loss) from operations before taxes		64		70		86		78		68	6.3%		237		301	27.0%
Federal income tax expense (benefit)		14		15		18		17		14	0.0%		50		63	26.0%
Income (loss) from operations	$	50	$	55	$	68	$	61	$	54	8.0%	$	187	$	238	27.3%

Effective Federal Income Tax Rate		21.0%		21.0%		21.0%		21.0%		21.0%			21.0%		21.0%

Average Equity, Excluding Goodwill and AOCI	$	2,082	$	2,165	$	2,360	$	2,492	$	2,554	22.7%	$	1,725	$	2,393	38.7%

ROE, Excluding Goodwill and AOCI		9.6%		10.1%		11.5%		9.9%		8.4%			10.8%		10.0%

Loss Ratios by Product Line
Life		70.8%		71.4%		71.2%		70.5%		65.7%			68.8%		69.7%
Disability		79.6%		75.4%		74.9%		76.4%		80.5%			75.4%		76.8%
Dental		70.6%		72.2%		75.0%		73.4%		70.7%			72.7%		72.8%
Total		75.8%		73.7%		73.6%		74.1%		74.4%			72.7%		73.9%








Page 16


Lincoln Financial Group
Other Operations – Select Earnings and Operational Data
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Other Operations
Operating revenues:
Insurance premiums	$	-	$	2	$	5	$	3	$	4	NM	$	11	$	13	18.2%
Net investment income		57		51		50		46		46	-19.3%		224		194	-13.4%
Amortization of deferred gain on
business sold through reinsurance		-		-		-		-		-	NM		1		-	-100.0%
Other revenues		(3)		4		3		1		4	233.3%		(1)		13	NM
Total operating revenues		54		57		58		50		54	0.0%		235		220	-6.4%
Operating expenses:
Interest credited		13		15		15		14		14	7.7%		56		58	3.6%
Benefits		20		20		25		42		23	15.0%		106		110	3.8%
Commissions and other expenses		(3)		24		18		5		17	NM		25		62	148.0%
Interest and debt expenses		69		71		70		71		72	4.3%		274		284	3.6%
Strategic digitization expense		28		15		15		16		18	-35.7%		76		66	-13.2%
Total operating expenses		127		145		143		148		144	13.4%		537		580	8.0%
Income (loss) from operations before taxes		(73)		(88)		(85)		(98)		(90)	-23.3%		(302)		(360)	-19.2%
Federal income tax expense (benefit)		(20)		(28)		(19)		(23)		(23)	-15.0%		(77)		(92)	-19.5%
Income (loss) from operations	$	(53)	$	(60)	$	(66)	$	(75)	$	(67)	-26.4%	$	(225)	$	(268)	-19.1%

















Page 17


Lincoln Financial Group
Consolidated – DAC, VOBA, DSI and DFEL Roll Forwards
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
DAC, VOBA and DSI
Balance as of beginning-of-period	$	10,278	$	10,512	$	9,689	$	8,832	$	7,731	-24.8%	$	8,641	$	10,512	21.7%
Deferrals		550		406		427		459		643	16.9%		1,654		1,934	16.9%
Operating amortization		(311)		(209)		(279)		(604)		(262)	15.8%		(1,270)		(1,354)	-6.6%
Deferrals, net of operating amortization		239		197		148		(145)		381	59.4%		384		580	51.0%
Amortization associated with benefit ratio unlocking		36		(25)		(7)		3		(16)	NM		37		(46)	NM
Business acquired		-		-		-		-		-	NM		30		-	-100.0%
Business sold through reinsurance		(278)		-		-		-		-	100.0%		(278)		-	100.0%
Adjustment related to realized (gains) losses		(38)		31		11		(9)		22	157.9%		(50)		55	210.0%
Adjustment related to unrealized (gains) losses		275		(1,026)		(1,009)		(950)		(190)	NM		1,748		(3,173)	NM
Balance as of end-of-period	$	10,512	$	9,689	$	8,832	$	7,731	$	7,928	-24.6%	$	10,512	$	7,928	-24.6%

DFEL
Balance as of beginning-of-period	$	2,442	$	2,769	$	2,203	$	1,647	$	482	-80.3%	$	1,445	$	2,769	91.6%
Deferrals		251		217		245		264		368	46.6%		875		1,095	25.1%
Operating amortization		(146)		(112)		(142)		(547)		(163)	-11.6%		(540)		(964)	-78.5%
Deferrals, net of operating amortization		105		105		103		(283)		205	95.2%		335		131	-60.9%
Amortization associated with benefit ratio unlocking		4		(3)		(1)		-		(2)	NM		5		(6)	NM
Adjustment related to realized (gains) losses		(10)		3		(3)		(3)		3	130.0%		(20)		-	100.0%
Adjustment related to unrealized (gains) losses		228		(671)		(655)		(879)		(38)	NM		1,004		(2,244)	NM
Balance as of end-of-period	$	2,769	$	2,203	$	1,647	$	482	$	650	-76.5%	$	2,769	$	650	-76.5%

DAC, VOBA, DSI and DFEL
Balance as of End-of-Period, After-Tax	$	6,117	$	5,914	$	5,676	$	5,727	$	5,750	-6.0%	$	6,117	$	5,750	-6.0%











Page 18


Lincoln Financial Group
Annuities – Account Value Roll Forwards
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Fixed Annuities
Balance as of beginning-of-period	$	21,116	$	21,666	$	22,941	$	23,836	$	24,448	15.8%	$	20,305	$	21,666	6.7%
Gross deposits		1,305		1,584		1,298		1,027		1,176	-9.9%		3,576		5,085	42.2%
Full surrenders and deaths		(501)		(469)		(501)		(441)		(355)	29.1%		(1,946)		(1,766)	9.2%
Other contract benefits		(186)		(151)		(135)		(145)		(170)	8.6%		(655)		(601)	8.2%
Net flows		618		964		662		441		651	5.3%		975		2,718	178.8%
Contract holder assessments		(9)		(8)		(10)		(10)		(11)	-22.2%		(31)		(39)	-25.8%
Reinvested interest credited		(59)		319		243		181		296	NM		417		1,039	149.2%
Balance as of end-of-period, gross		21,666		22,941		23,836		24,448		25,384	17.2%		21,666		25,384	17.2%
Reinsurance ceded		(8,923)		(8,997)		(8,997)		(8,837)		(8,748)	2.0%		(8,923)		(8,748)	2.0%
Balance as of end-of-period, net	$	12,743	$	13,944	$	14,839	$	15,611	$	16,636	30.6%	$	12,743	$	16,636	30.6%

Variable Annuities
Balance as of beginning-of-period	$	119,430	$	108,536	$	116,514	$	119,005	$	118,424	-0.8%	$	117,479	$	108,536	-7.6%
Gross deposits		2,469		1,924		2,356		2,434		2,726	10.4%		8,787		9,440	7.4%
Full surrenders and deaths		(1,414)		(1,458)		(1,722)		(1,711)		(1,642)	-16.1%		(6,095)		(6,533)	-7.2%
Other contract benefits		(998)		(938)		(919)		(911)		(1,006)	-0.8%		(3,806)		(3,774)	0.8%
Net flows		57		(472)		(285)		(188)		78	36.8%		(1,114)		(867)	22.2%
Contract holder assessments		(617)		(601)		(619)		(636)		(638)	-3.4%		(2,484)		(2,495)	-0.4%
Change in market value and reinvestment		(10,334)		9,051		3,395		243		7,628	173.8%		(5,345)		20,318	NM
Balance as of end-of-period, gross and net	$	108,536	$	116,514	$	119,005	$	118,424	$	125,492	15.6%	$	108,536	$	125,492	15.6%

Total
Balance as of beginning-of-period	$	140,546	$	130,202	$	139,455	$	142,841	$	142,872	1.7%	$	137,784	$	130,202	-5.5%
Gross deposits		3,774		3,508		3,654		3,461		3,902	3.4%		12,363		14,525	17.5%
Full surrenders and deaths		(1,915)		(1,927)		(2,223)		(2,152)		(1,997)	-4.3%		(8,041)		(8,299)	-3.2%
Other contract benefits		(1,184)		(1,089)		(1,054)		(1,056)		(1,176)	0.7%		(4,461)		(4,375)	1.9%
Net flows		675		492		377		253		729	8.0%		(139)		1,851	NM
Contract holder assessments		(626)		(609)		(629)		(646)		(649)	-3.7%		(2,515)		(2,534)	-0.8%
Change in market value and reinvestment		(10,393)		9,370		3,638		424		7,924	176.2%		(4,928)		21,357	NM
Balance as of end-of-period, gross		130,202		139,455		142,841		142,872		150,876	15.9%		130,202		150,876	15.9%
Reinsurance ceded		(8,923)		(8,997)		(8,997)		(8,837)		(8,748)	2.0%		(8,923)		(8,748)	2.0%
Balance as of end-of-period, net	$	121,279	$	130,458	$	133,844	$	134,035	$	142,128	17.2%	$	121,279	$	142,128	17.2%



Page 19


	Lincoln Financial Group
	Retirement Plan Services – Account Value Roll Forwards
	Unaudited (millions of dollars)

		For the Three Months Ended											For the Twelve Months Ended
		12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
	General Account
	Balance as of beginning-of-period	$	19,511	$	19,766	$	19,914	$	20,076	$	20,337	4.2%	$	18,724	$	19,766	5.6%
	Gross deposits		489		458		393		469		663	35.6%		2,046		1,983	-3.1%
	Withdrawals		(544)		(519)		(470)		(490)		(682)	-25.4%		(1,949)		(2,161)	-10.9%
	Net flows		(55)		(61)		(77)		(21)		(19)	65.5%		97		(178)	NM
	Transfers between fixed and variable accounts		169		70		97		136		94	-44.4%		398		397	-0.3%
	Contract holder assessments		(3)		(3)		(3)		(3)		(3)	0.0%		(11)		(12)	-9.1%
	Reinvestment interest credited		144		142		145		149		149	3.5%		558		585	4.8%
	Balance as of end-of-period	$	19,766	$	19,914	$	20,076	$	20,337	$	20,558	4.0%	$	19,766	$	20,558	4.0%

	Separate Account and Mutual Funds
	Balance as of beginning-of-period	$	52,994	$	47,289	$	51,885	$	53,938	$	54,227	2.3%	$	48,645	$	47,289	-2.8%
	Gross deposits		1,674		2,038		1,680		1,765		2,000	19.5%		8,022		7,482	-6.7%
	Withdrawals		(1,446)		(2,358)		(1,296)		(1,472)		(1,559)	-7.8%		(5,573)		(6,684)	-19.9%
	Net flows		228		(320)		384		293		441	93.4%		2,449		798	-67.4%
	Transfers between fixed and variable accounts		(170)		(210)		(141)		(190)		(171)	-0.6%		(535)		(712)	-33.1%
	Contract holder assessments		(52)		(51)		(52)		(54)		(55)	-5.8%		(210)		(212)	-1.0%
	Change in market value and reinvestment		(5,711)		5,177		1,862		240		3,689	164.6%		(3,060)		10,968	NM
	Balance as of end-of-period	$	47,289	$	51,885	$	53,938	$	54,227	$	58,131	22.9%	$	47,289	$	58,131	22.9%

	Total
	Balance as of beginning-of-period	$	72,505	$	67,055	$	71,799	$	74,014	$	74,564	2.8%	$	67,369	$	67,055	-0.5%
	Gross deposits		2,163		2,496		2,073		2,234		2,663	23.1%		10,068		9,465	-6.0%
	Withdrawals		(1,990)		(2,877)		(1,766)		(1,962)		(2,241)	-12.6%		(7,522)		(8,845)	-17.6%
	Net flows		173		(381)		307		272		422	143.9%		2,546		620	-75.6%
	Transfers between fixed and variable accounts		(1)		(140)		(44)		(54)		(77)	NM		(137)		(315)	NM
	Contract holder assessments		(55)		(54)		(55)		(57)		(58)	-5.5%		(221)		(224)	-1.4%
	Change in market value and reinvestment		(5,567)		5,319		2,007		389		3,838	168.9%		(2,502)		11,553	NM
	Balance as of end-of-period	$	67,055	$	71,799	$	74,014	$	74,564	$	78,689	17.3%	$	67,055	$	78,689	17.3%







8	Page 20


Lincoln Financial Group
Life Insurance – Account Value Roll Forwards
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
General Account
Balance as of beginning-of-period	$	37,054	$	37,289	$	37,275	$	37,438	$	37,582	1.4%	$	36,791	$	37,289	1.4%
Deposits		1,133		1,027		1,117		1,137		1,525	34.6%		4,271		4,806	12.5%
Withdrawals and deaths		(197)		(331)		(195)		(243)		(156)	20.8%		(1,093)		(925)	15.4%
Net flows		936		696		922		894		1,369	46.3%		3,178		3,881	22.1%
Contract holder assessments		(1,051)		(1,043)		(1,107)		(1,094)		(1,184)	-12.7%		(4,114)		(4,428)	-7.6%
Reinvested interest credited		350		333		348		344		374	6.9%		1,434		1,399	-2.4%
Balance as of end-of-period, gross		37,289		37,275		37,438		37,582		38,141	2.3%		37,289		38,141	2.3%
Reinsurance ceded		(677)		(669)		(666)		(660)		(656)	3.1%		(677)		(656)	3.1%
Balance as of end-of-period, net	$	36,612	$	36,606	$	36,772	$	36,922	$	37,485	2.4%	$	36,612	$	37,485	2.4%

Separate Account
Balance as of beginning-of-period	$	15,102	$	13,735	$	15,346	$	15,941	$	16,136	6.8%	$	13,851	$	13,735	-0.8%
Deposits		730		510		566		548		888	21.6%		2,167		2,514	16.0%
Withdrawals and deaths		(227)		(186)		(271)		(215)		(300)	-32.2%		(666)		(973)	-46.1%
Net flows		503		324		295		333		588	16.9%		1,501		1,541	2.7%
Contract holder assessments		(210)		(193)		(195)		(197)		(230)	-9.5%		(755)		(815)	-7.9%
Change in market value and reinvestment		(1,660)		1,480		495		59		1,152	169.4%		(862)		3,185	NM
Balance as of end-of-period, gross		13,735		15,346		15,941		16,136		17,646	28.5%		13,735		17,646	28.5%
Reinsurance ceded		(758)		(832)		(844)		(829)		(876)	-15.6%		(758)		(876)	-15.6%
Balance as of end-of-period, net	$	12,977	$	14,514	$	15,097	$	15,307	$	16,770	29.2%	$	12,977	$	16,770	29.2%

Total
Balance as of beginning-of-period	$	52,156	$	51,024	$	52,621	$	53,379	$	53,718	3.0%	$	50,642	$	51,024	0.8%
Deposits		1,863		1,537		1,683		1,685		2,413	29.5%		6,438		7,320	13.7%
Withdrawals and deaths		(424)		(517)		(466)		(458)		(456)	-7.5%		(1,759)		(1,898)	-7.9%
Net flows		1,439		1,020		1,217		1,227		1,957	36.0%		4,679		5,422	15.9%
Contract holder assessments		(1,261)		(1,236)		(1,302)		(1,291)		(1,414)	-12.1%		(4,869)		(5,243)	-7.7%
Change in market value and reinvestment		(1,310)		1,813		843		403		1,526	216.5%		572		4,584	NM
Balance as of end-of-period, gross		51,024		52,621		53,379		53,718		55,787	9.3%		51,024		55,787	9.3%
Reinsurance ceded		(1,435)		(1,501)		(1,510)		(1,489)		(1,532)	-6.8%		(1,435)		(1,532)	-6.8%
Balance as of end-of-period, net	$	49,589	$	51,120	$	51,869	$	52,229	$	54,255	9.4%	$	49,589	$	54,255	9.4%




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Lincoln Financial Group
Select Investment Data
Unaudited (millions of dollars)

	As of 12/31/18				As of 12/31/19
	Amount		%		Amount		%
Fixed Maturity AFS, Trading and Equity Securities, at Fair Value
Fixed maturity AFS securities:
Corporate bonds	$	80,348		83.7%	$	88,716		80.7%
U.S. government bonds		417		0.4%		435		0.4%
State and municipal bonds		5,345		5.6%		5,884		5.4%
Foreign government bonds		448		0.5%		393		0.4%
Residential mortgage-backed securities		3,373		3.5%		3,241		2.9%
Commercial mortgage-backed securities		804		0.8%		1,083		1.0%
Asset-backed securities		2,696		2.8%		4,889		4.4%
Hybrid and redeemable preferred securities		593		0.6%		559		0.5%
Total fixed maturity AFS securities		94,024		97.9%		105,200		95.7%
Trading securities		1,950		2.0%		4,673		4.2%
Equity securities		99		0.1%		103		0.1%
Total fixed maturity AFS, trading and equity securities	$	96,073		100.0%	$	109,976		100.0%

Fixed Maturity AFS, Trading and Equity Securities, at Amortized Cost
Fixed maturity AFS securities	$	92,429		98.0%	$	94,295		95.8%
Trading securities		1,823		1.9%		4,005		4.1%
Equity securities		116		0.1%		123		0.1%
Total fixed maturity AFS, trading and equity securities	$	94,368		100.0%	$	98,423		100.0%

Percentage of Fixed Maturity AFS Securities, at Amortized Cost
Investment grade				96.2%				96.3%
Below investment grade				3.8%				3.7%











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Lincoln Financial Group
Realized Gain (Loss) and Benefit Ratio Unlocking, After-DAC
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Components of Realized Gain (Loss), Pre-Tax
Total adjusted operating realized gain (loss)	$	50	$	38	$	44	$	50	$	52	4.0%	$	187	$	184	-1.6%
Total excluded realized gain (loss)		141		(400)		(161)		(61)		(171)	NM		(46)		(794)	NM
Total realized gain (loss), pre-tax	$	191	$	(362)	$	(117)	$	(11)	$	(119)	NM	$	141	$	(610)	NM

Reconciliation of Excluded Realized Gain (Loss)
Net of Benefit Ratio Unlocking, After-Tax
Total excluded realized gain (loss)	$	111	$	(316)	$	(128)	$	(49)	$	(135)	NM	$	(37)	$	(627)	NM
Benefit ratio unlocking		(167)		142		46		(2)		91	154.5%		(136)		277	NM
Excluded realized gain (loss) net of
benefit ratio unlocking, after-tax	$	(56)	$	(174)	$	(82)	$	(51)	$	(44)	21.4%	$	(173)	$	(350)	NM

Components of Excluded Realized Gain (Loss) Net
of Benefit Ratio Unlocking, After-Tax
OTTI	$	(2)	$	(6)	$	(3)	$	(2)	$	(1)	50.0%	$	(6)	$	(12)	-100.0%
Other realized gain (loss) related to certain investments		(13)		(15)		(7)		(12)		(11)	16.5%		(27)		(44)	-63.0%
Gain (loss) on the mark-to-market on equity investments		(15)		5		1		(14)		6	140.0%		(13)		(2)	84.6%
Gain (loss) on the mark-to-market on certain instruments		(7)		(94)		(28)		19		9	228.6%		(13)		(95)	NM
Realized gain (loss) related to investments, after-tax		(37)		(110)		(37)		(9)		3	108.1%		(59)		(153)	NM
Variable annuity net derivative results:
Hedge program performance, including unlocking
for GLB reserves hedged		(53)		(15)		(19)		(65)		2	103.8%		(137)		(97)	29.2%
GLB non-performance risk component		56		(27)		(2)		43		(55)	NM		57		(41)	NM
Total variable annuity net derivative results		3		(42)		(21)		(22)		(53)	NM		(80)		(138)	-72.5%
Indexed annuity forward-starting option		(22)		(22)		(24)		(20)		6	127.3%		(34)		(59)	-73.5%
Excluded realized gain (loss) net of
benefit ratio unlocking, after-tax	$	(56)	$	(174)	$	(82)	$	(51)	$	(44)	21.4%	$	(173)	$	(350)	NM









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Lincoln Financial Group
Select GAAP to Non-GAAP Reconciliations
Unaudited (millions of dollars)

	For the Three Months Ended											For the Twelve Months Ended
	12/31/18		3/31/19		6/30/19		9/30/19		12/31/19		Change	12/31/18		12/31/19		Change
Revenues
Total revenues	$	4,531	$	3,965	$	4,310	$	4,638	$	4,344	-4.1%	$	16,424	$	17,258	5.1%
Less:
Excluded realized gain (loss)		141		(400)		(161)		(61)		(171)	NM		(46)		(794)	NM
Amortization of DFEL associated with
benefit ratio unlocking		(4)		3		1		(1)		2	150.0%		(5)		6	220.0%
Adjusted operating revenues	$	4,394	$	4,362	$	4,470	$	4,700	$	4,513	2.7%	$	16,475	$	18,046	9.5%

Net Income
Net income (loss)	$	399	$	252	$	363	$	(161)	$	431	8.0%	$	1,641	$	886	-46.0%
Less:
Excluded realized gain (loss), after-tax		111		(316)		(128)		(49)		(135)	NM		(37)		(627)	NM
Benefit ratio unlocking, after-tax		(167)		142		46		(2)		91	154.5%		(136)		277	NM
Net impact from the Tax Cuts and Jobs Act		-		-		-		-		17	NM		19		17	-10.5%
Acquisition and integration costs related to
mergers and acquisitions, after-tax		(20)		(15)		(33)		(31)		(24)	-20.0%		(67)		(103)	-53.7%
Gain (loss) on early extinguishment of debt, after-tax		-		-		-		(33)		-	NM		(18)		(33)	-83.3%
Total adjustments		(76)		(189)		(115)		(115)		(51)	32.9%		(239)		(469)	-96.2%
Adjusted income (loss) from operations	$	475	$	441	$	478	$	(46)	$	482	1.5%	$	1,880	$	1,355	-27.9%

Earnings (Loss) Per Common Share – Diluted
Net income (loss)	$	1.80	$	1.22	$	1.79	$	(0.83)	$	2.15	19.4%	$	7.40	$	4.38	-40.8%
Less:
Excluded realized gain (loss), after-tax		0.53		(1.54)		(0.63)		(0.24)		(0.68)	NM		(0.16)		(3.11)	NM
Benefit ratio unlocking, after-tax		(0.78)		0.69		0.22		(0.01)		0.46	159.0%		(0.62)		1.38	NM
Net impact from the Tax Cuts and Jobs Act		-		-		-		-		0.08	NM		0.09		0.08	-11.1%
Acquisition and integration costs related to mergers
and acquisitions, after-tax		(0.10)		(0.07)		(0.16)		(0.16)		(0.12)	-20.0%		(0.31)		(0.51)	-64.5%
Gain (loss) on early extinguishment of debt, after-tax		-		-		-		(0.17)		-	NM		(0.08)		(0.17)	NM
Adjusted income (loss) from operations	$	2.15	$	2.14	$	2.36	$	(0.25)	$	2.41	12.1%	$	8.48	$	6.71	-20.9%





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LINCOLN NATIONAL CORP - FORM 8-K - EX-99.2 - February 5, 2020

Attached files