nationwide 1Q07 Statistical Supplement

2007 Nationwide Financial® Statistical Supplement

FIRST QUARTER

Nationwide Financial Services, Inc.Statistical Supplement

March 31, 2007

This Page Intentionally Left Blank.


Table of Contents

Page

Quarterly Financial Highlights 1-2

NFS Financial Reporting Structure 2

Quarterly Consolidated Income Statements 4

Combining Income StatementsFor the three months ended March 31, 2007 5For the three months ended March 31, 2006 6

Quarterly Consolidated Balance Sheets 8

Individual Investments SegmentQuarterly earnings trends 9Account value activity 9Account values by product 10Sales by product 10Sales by channel 10

Retirement Plans SegmentQuarterly earnings trends 11Account value activity 11Account values by product 12Sales by product 12Sales by channel 12

Individual Protection SegmentQuarterly earnings trends 13Policy reserves 13Insurance in force 13Sales by product 14Sales by channel 14Investment life quarterly earnings trends 15Investment life policy reserve activity 15Fixed life quarterly earnings trends 16Fixed life policy reserve activity 16

Corporate and Other SegmentQuarterly earnings trends 17Medium term notes account value activity 17

Other DataCustomer funds managed and administered 18Separate account assets by segment and fund type 18Securities available-for-sale 19Aging of gross unrealized losses on securities available-for-sale 19Credit quality of fixed maturity securities available-for-sale 20Mortgage loans by region and property type 20Deferred policy acquisition costs 21Individual variable annuity deferred acquisition costs 22Value of business acquired 23Individual variable annuity guaranteed minimum death benefits 24Individual variable annuity guaranteed minimum accumulation benefits 25Individual variable annuity guaranteed minimum income benefits 25Individual variable annuity guaranteed lifetime withdrawal benefits 25Individual variable annuity guaranteed minimum death benefit reserve activity 26Individual variable annuity guaranteed minimum accumulation benefit embedded derivative activity 26Individual fixed annuity and fixed option of variable annuity summary of crediting rate detail 26

Historical Data 27-40

Glossary 41-44

Shareholder Information 45

March 31, 2007


March 31, 2007

Quarterly Financial Highlights

($ in millions except for per share data) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Operating Revenues

Individual investments 382.6$ 373.2$ 382.3$ 376.2$ 365.0$ Retirement plans 269.5 285.7 277.4 278.3 279.0 Individual protection 338.4 333.7 338.6 334.8 342.5 Corporate and other 100.1 111.5 108.8 125.0 142.3

Total operating revenues 1,090.6$ 1,104.1$ 1,107.1$ 1,114.3$ 1,128.8$

Net realized gains (losses) on investments, hedging instruments and hedged items (1) (8.1) (11.0) 5.5 13.0 (13.5)

Total revenues 1,082.5$ 1,093.1$ 1,112.6$ 1,127.3$ 1,115.3$

Pre-tax Operating EarningsIndividual investments 56.4$ 52.5$ 60.4$ 41.5$ 51.0$ Retirement plans 53.6 64.5 53.7 44.7 50.1 Individual protection 64.9 60.5 71.0 78.4 82.9 Corporate and other 11.6 16.6 21.7 17.8 33.6

Pre-tax operating earnings 186.5$ 194.1$ 206.8$ 182.4$ 217.6$ Federal income tax expense 42.2 (69.9) 52.1 37.5 47.2

Net operating earnings 144.3$ 264.0$ 154.7$ 144.9$ 170.4$

Net realized gains (losses) on investments, hedging instruments and hedged items, net of taxes (1) (5.3) (7.2) 3.6 8.5 (8.8)

Adjustment to amortization related to net realized gains (losses), net of taxes 3.3 1.0 1.2 0.8 1.7

Discontinued operations, net of taxes - - - - 45.9

Cumulative effect of adoption of accounting principles, net of taxes - - - - (6.0)

Net income 142.3$ 257.8$ 159.5$ 154.2$ 203.2$

Per Diluted ShareNet operating earnings 0.94$ 1.76$ 1.03$ 0.97$ 1.16$

Net realized gains (losses) on investments, hedging instruments and hedged items, net of taxes (1) (0.03) (0.05) 0.02 0.05 (0.06)




Net income 0.93$ 1.72$ 1.06$ 1.03$ 1.38$

Sales by ChannelNon-affiliated Independent broker/dealers 1,487.8$ 1,380.7$ 1,363.9$ 1,525.8$ 1,708.7$ Wirehouse and regional firms 590.1 555.6 596.4 691.5 679.7 Financial institutions 523.7 580.7 570.1 620.6 590.5 Pension plan administrators 135.9 139.6 124.8 132.5 175.8 Life specialists 172.6 84.0 46.3 277.7 88.3 Affiliated Nationwide Retirement Solutions 1,028.5 1,001.2 1,031.3 989.2 1,082.2 Nationwide agents 196.4 203.1 186.6 201.7 196.1 Nationwide Financial Network 185.7 171.0 168.3 173.7 158.3 TBG Financial 110.4 62.7 21.4 31.6 115.0

Total 4,431.1$ 4,178.6$ 4,109.1$ 4,644.3$ 4,794.6$

(1) Excluding operating items (periodic net coupon settlements on non-qualifying derivatives, trading portfolio realized gains and losses, trading portfolio valuation changes, and net realized gains and losses related to securitizations).

Note: The results of operations of The 401(k) Company are reflected as discontinued operations for 2006 and all prior years. In addition, the sales and account value sections in the subsequent portions of the report exclude amounts applicable to the operations that were discontinued.

1


March 31, 2007Quarterly Financial Highlights

($ in millions except for per share data) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Balance Sheet Data

Total assets 116,558.7$ 113,083.0$ 114,880.0$ 119,411.6$ 120,343.5$

Customer funds managed and administered 146,101.8$ 143,027.6$ 145,835.3$ 154,069.3$ 156,080.8$

Shareholders' equity Including accumulated other comprehensive income (AOCI) (1) 5,126.2$ 5,236.8$ 5,630.0$ 5,538.3$ 5,715.4$ AOCI (77.9) (202.0) 47.8 31.9 83.6 Excluding AOCI 5,204.1$ 5,438.8$ 5,582.2$ 5,506.4$ 5,631.8$

Net operating return on average equity excluding AOCI 11.0% 19.8% 11.2% 10.5% 12.2%

Adjusted net operating return on average equity excluding AOCI (2) 11.0% 11.5% 11.2% 10.5% 12.2%

Statutory capital and surplus 3,279.3$ 3,437.4$ 3,504.2$ 3,336.6$ 3,010.0$

Stock DataClosing Price 43.02$ 44.08$ 48.10$ 54.20$ 53.86$

Weighted average shares outstanding Basic 152.3 149.2 149.5 148.7 145.9 Diluted 152.9 149.9 150.3 149.8 147.1

Book value per share Including AOCI 34.40$ 35.08$ 37.61$ 37.93$ 39.31$ Excluding AOCI 34.93$ 36.43$ 37.29$ 37.72$ 38.73$

(1) Includes changes in fair value of certain investments and derivatives under SFAS 115 and SFAS 133.

(2) 2Q 2006 return adjusted for $113.1 million of released tax reserves and associated tax-related adjustments relating to prior tax years.

Note: The results of operations of The 401(k) Company are reflected as discontinued operations for 2006 and all prior years.

NFS Operating Segment Reporting Structure

NATIONWIDE FINANCIAL SERVICES, INC.

IndividualInvestments

RetirementPlans

IndividualProtection

Corporateand Other

Variable Annuities

Fixed Annuities

Income Products

Advisory Services

Public Sector - 457

Private Sector – 401(k)

Fixed Life

Investment Life

Nationwide Bank

Medium Term Notes

Structured Products

Universal

Whole

Term

Variable Universal

COLICorporate Other

2


March 31, 2007


3


March 31, 2007

Quarterly Consolidated Income Statements

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Operating Revenues

Asset fees 168.9$ 170.0$ 169.2$ 183.1$ 184.2$ Cost of insurance charges 98.9 100.2 100.6 102.3 104.1 Administrative fees 30.2 47.2 36.2 25.5 29.0 Surrender fees 23.0 20.2 21.6 18.9 18.6

Total policy charges 321.0 337.6 327.6 329.8 335.9

Traditional life and immediate annuity premiums 107.8 109.7 110.5 113.5 110.4 Net investment income 577.3 572.1 577.9 571.2 574.5 Operating realized gains (losses) 1.3 1.1 4.1 3.1 2.1 Other income 83.2 83.6 87.0 96.7 105.9

Total operating revenues 1,090.6 1,104.1 1,107.1 1,114.3 1,128.8

BenefitsInterest credited 342.1 345.7 348.2 344.3 334.8 Life insurance and annuity benefits 156.1 156.4 163.8 170.5 153.6 Policyholder dividends 20.2 24.5 24.6 21.4 21.3

Total benefits 518.4 526.6 536.6 536.2 509.7

ExpensesCommissions 153.1 160.4 160.7 174.2 168.7 General operating expenses 204.3 205.3 191.8 244.8 207.1 Deferral of policy acquisition costs (135.1) (147.4) (138.8) (167.1) (145.1)

Subtotal 222.3 218.3 213.7 251.9 230.7

Amortization of policy acquisition costs 125.7 127.5 109.8 109.6 135.7 Amortization of value of business acquired 11.6 12.5 14.9 7.0 10.3 Interest expense on debt 26.1 25.1 25.3 27.2 24.8

Total expenses 385.7 383.4 363.7 395.7 401.5

Pre-tax operating earnings 186.5$ 194.1$ 206.8$ 182.4$ 217.6$ Federal income tax expense 42.2 (69.9) 52.1 37.5 47.2


Net realized gains (losses) on investments, hedging

instruments and hedged items, net of taxes (1)

Realized gains on sales, net of hedging 7.3 11.0 10.2 31.2 14.9 Realized losses on sales, net of hedging (12.9) (19.1) (4.4) (12.5) (14.8) Other-than-temporary impairments, including mortgage loan valuation allowance adjustment (0.6) (2.5) (2.9) (5.0) (8.6) Credit default swaps (0.1) (0.1) (0.1) (0.5) (0.2) Derivatives, excluding hedging gains and losses on sales and credit default swaps 0.5 3.4 0.3 (4.6) 0.4 Amounts credited to policyholder dividend obligation 0.1 (0.7) 0.5 0.1 (0.7) Adjustment to VOBA amortization 0.4 0.8 - (0.2) 0.2

Subtotal (5.3) (7.2) 3.6 8.5 (8.8)




Net income 142.3$ 257.8$ 159.5$ 154.2$ 203.2$



4


March 31, 2007

Combining Income StatementFor the three months ended March 31, 2007

Individual Retirement Individual Corporate($ in millions) Investments Plans Protection and Other TotalOperating Revenues

Asset fees 137.8$ 33.7$ 12.7$ -$ 184.2$ Cost of insurance charges - - 104.1 - 104.1 Administrative fees 6.3 2.6 20.1 - 29.0 Surrender fees 12.6 1.0 5.0 - 18.6

Total policy charges 156.7 37.3 141.9 - 335.9

Traditional life and immediate annuity premiums 33.5 - 76.9 - 110.4 Net investment income 174.0 165.5 119.6 115.4 574.5 Operating realized gains (losses) - - - 2.1 2.1 Other income 0.8 76.2 4.1 24.8 105.9

Total operating revenues 365.0 279.0 342.5 142.3 1,128.8

BenefitsInterest credited 118.2 111.1 47.3 58.2 334.8 Life insurance and annuity benefits 46.6 - 107.0 - 153.6 Policyholder dividends - - 21.3 - 21.3

Total benefits 164.8 111.1 175.6 58.2 509.7

ExpensesCommissions 88.8 41.7 31.2 7.0 168.7 General operating expenses 50.6 74.9 62.7 18.9 207.1 Deferral of policy acquisition costs (91.0) (9.0) (45.1) - (145.1)

Subtotal 48.4 107.6 48.8 25.9 230.7

Amortization of policy acquisition costs 99.5 9.8 26.4 - 135.7 Amortization of value of business acquired 1.3 0.4 8.6 - 10.3 Interest expense on debt - - 0.2 24.6 24.8

Total expenses 149.2 117.8 84.0 50.5 401.5

Pre-tax operating earnings 51.0$ 50.1$ 82.9$ 33.6$ 217.6$

Federal income tax expense 47.2 Net operating earnings 170.4$



Realized gains on sales, net of hedging 14.9 Realized losses on sales, net of hedging (14.8) Other-than-temporary impairments, including mortgage loan valuation allowance adjustment (8.6) Credit default swaps (0.2) Derivatives, excluding hedging gains and losses on sales and credit default swaps 0.4 Amounts credited to policyholder dividend obligation (0.7) Adjustment to VOBA amortization 0.2

Subtotal (8.8)

Adjustment to amortization related to net realized gains (losses), net of taxes 1.7

Discontinued operations, net of taxes 45.9

Cumulative effect of adoption of accounting principles, net of taxes (6.0)

Net income 203.2$


5


March 31, 2007

Combining Income StatementFor the three months ended March 31, 2006

Individual Retirement Individual Corporate($ in millions) Investments Plans Protection and Other TotalOperating Revenues

Asset fees 124.0$ 33.9$ 11.0$ -$ 168.9$ Cost of insurance charges - - 98.9 - 98.9 Administrative fees 4.6 2.7 22.9 - 30.2 Surrender fees 15.2 1.5 6.3 - 23.0

Total policy charges 143.8 38.1 139.1 - 321.0

Traditional life and immediate annuity premiums 31.9 - 75.9 - 107.8 Net investment income 206.4 164.2 116.2 90.5 577.3 Operating realized gains (losses) - - - 1.3 1.3 Other income 0.5 67.2 7.2 8.3 83.2

Total operating revenues 382.6 269.5 338.4 100.1 1,090.6

BenefitsInterest credited 137.7 113.2 45.6 45.6 342.1 Life insurance and annuity benefits 41.0 - 115.1 - 156.1 Policyholder dividends - - 20.2 - 20.2

Total benefits 178.7 113.2 180.9 45.6 518.4

ExpensesCommissions 73.6 37.8 35.6 6.1 153.1 General operating expenses 48.4 63.1 82.0 10.8 204.3 Deferral of policy acquisition costs (74.4) (9.4) (51.3) - (135.1)

Subtotal 47.6 91.5 66.3 16.9 222.3

Amortization of policy acquisition costs 97.6 10.1 18.0 - 125.7 Amortization of value of business acquired 2.3 1.1 8.1 0.1 11.6 Interest expense on debt - - 0.2 25.9 26.1

Total expenses 147.5 102.7 92.6 42.9 385.7


Federal income tax expense 42.2 Net operating earnings 144.3$



Realized gains on sales, net of hedging 7.3 Realized losses on sales, net of hedging (12.9) Other-than-temporary impairments, including mortgage loan valuation allowance adjustment (0.6) Credit default swaps (0.1) Derivatives, excluding hedging gains and losses on sales and credit default swaps 0.5 Amounts credited to policyholder dividend obligation 0.1 Adjustment to VOBA amortization 0.4

Subtotal (5.3)

Adjustment to amortization related to net realized gains (losses), net of taxes 3.3

Discontinued operations, net of taxes -

Net income 142.3$



6


March 31, 2007


7


March 31, 2007

Quarterly Consolidated Balance Sheets

($ in millions, except per share data) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Assets

InvestmentsSecurities available-for-sale: Fixed maturity securities 28,645.0$ 27,980.9$ 28,579.0$ 28,160.0$ 28,356.6$ Equity securities 76.5 63.2 65.2 67.6 69.0 Trading assets 27.8 21.0 22.8 24.3 24.3 Mortgage loans 9,048.3 9,060.7 8,981.2 8,909.8 8,689.8 Real estate 108.6 108.4 104.8 76.7 67.8 Policy loans 933.9 948.3 957.7 966.9 974.6 Other long-term investments 688.9 687.4 680.6 780.1 770.0 Short-term investments 2,830.5 2,169.7 1,917.4 2,215.6 2,469.3

Total investments 42,359.5 41,039.6 41,308.7 41,201.0 41,421.4

Cash 23.9 23.6 12.9 20.2 19.4 Accrued investment income 398.9 388.7 412.6 373.8 387.5 Deferred policy acquisition costs 3,794.7 3,875.6 3,783.5 3,851.0 3,819.6 Value of business acquired 443.3 405.2 399.1 392.7 385.6 Other intangible assets 45.4 44.9 44.2 43.6 42.9 Goodwill 359.0 359.0 359.0 359.0 341.7 Other assets 2,200.3 2,117.3 2,433.2 2,475.6 2,637.3 Assets held in separate accounts 66,933.7 64,829.1 66,126.8 70,694.7 71,288.1

Total assets 116,558.7$ 113,083.0$ 114,880.0$ 119,411.6$ 120,343.5$

Liabilities and shareholders' equityFuture policy benefits and claims 39,519.4$ 38,451.3$ 38,131.9$ 38,097.8$ 37,322.6$ Short-term debt 147.4 189.8 88.6 85.2 156.6 Long-term debt 1,398.3 1,398.4 1,398.1 1,398.5 1,398.9 Other liabilities 3,433.7 2,977.6 3,504.6 3,597.1 4,461.9 Liabilities related to separate accounts 66,933.7 64,829.1 66,126.8 70,694.7 71,288.1

111,432.5 107,846.2 109,250.0 113,873.3 114,628.1

Shareholders' equity 5,126.2 5,236.8 5,630.0 5,538.3 5,715.4 Total liabilities and shareholders' equity 116,558.7$ 113,083.0$ 114,880.0$ 119,411.6$ 120,343.5$

Capital Structure

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07

Total capital, including AOCI 6,524.5$ 6,635.2$ 7,028.1$ 6,936.8$ 7,114.3$ Less AOCI (77.9) (202.0) 47.8 31.9 83.6 Total capital, excluding AOCI 6,602.4$ 6,837.2$ 6,980.3$ 6,904.9$ 7,030.7$

Leverage, including AOCI Long-term debt--to--total capital 21.4% 21.1% 19.9% 20.2% 19.7%

Leverage, excluding AOCI Long-term debt--to--total capital 21.2% 20.5% 20.0% 20.3% 19.9%

Ratio of pre-tax operating earnings before interest expense to interest expense 8.1X 8.7X 9.2X 7.7X 9.8X

8


March 31, 2007

Individual InvestmentsQuarterly Earnings Trends


Asset fees 124.0$ 125.0$ 125.2$ 137.2$ 137.8$ Administrative fees 4.6 4.9 5.5 5.4 6.3 Surrender fees 15.2 14.2 14.7 12.5 12.6


Net Investment Income General account assets 212.7 200.0 205.9 187.7 181.0 Charge for invested capital (6.3) (6.1) (6.8) (6.0) (7.0)

Total net investment income 206.4 193.9 199.1 181.7 174.0

Premiums on income products 31.9 34.6 37.3 38.7 33.5 Other income 0.5 0.6 0.5 0.7 0.8

Total operating revenues 382.6 373.2 382.3 376.2 365.0

Benefits Interest credited 137.7 132.7 131.5 126.4 118.2 Immediate annuity benefits 28.5 30.4 31.7 36.3 28.9 Policy benefits 12.5 19.2 23.8 20.0 17.7

Total benefits 178.7 182.3 187.0 182.7 164.8


Subtotal 47.6 51.4 53.6 61.0 48.4

Amortization of policy acquisition costs 97.6 84.8 79.5 90.8 99.5 Amortization of value of business acquired 2.3 2.2 1.8 0.2 1.3

Total expenses 147.5 138.4 134.9 152.0 149.2


Key Ratios/StatisticsAverage Account Values: General account 14,825.4$ 14,374.0$ 13,824.3$ 13,223.4$ 12,664.0$ Separate account 36,504.3 36,815.8 36,824.2 38,340.3 39,726.2 Advisory services program 443.3 491.6 528.7 573.2 607.0

Total average individual investments account values 51,773.0$ 51,681.4$ 51,177.2$ 52,136.9$ 52,997.2$

Earned rate 5.74% 5.56% 5.95% 5.67% 5.71%Credited rate 3.72% 3.69% 3.80% 3.82% 3.73%

Interest spread on average general account values 2.02% 1.87% 2.15% 1.85% 1.98%Prepayment penalties and bond call premium income 0.11% 0.09% 0.24% 0.17% 0.15%

Base interest spread on average general account values 1.91% 1.78% 1.91% 1.68% 1.83%

Asset fees to average separate account values 1.36% 1.36% 1.36% 1.43% 1.39%

General operating expenses to average account values 0.37% 0.43% 0.43% 0.50% 0.38%

Pre-tax operating earnings to average account values 0.44% 0.41% 0.47% 0.32% 0.38%

Pre-tax operating earnings to operating revenues 14.7% 14.1% 15.8% 11.0% 14.0%

Average allocated capital 1,563.0$ 1,504.3$ 1,467.4$ 1,441.9$ 1,383.1$

Return on average allocated capital 11.9% 11.8% 13.1% 10.3% 13.6%

Individual InvestmentsAccount Value Activity

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Individual Variable Annuities

Balance, beginning of period 40,796.0$ 42,071.5$ 41,140.7$ 41,771.1$ 43,804.8$

Deposits 1,045.0 1,279.9 1,263.4 1,446.6 1,314.8 Withdrawals and surrenders (1,535.4) (1,479.4) (1,554.2) (1,564.3) (1,586.1)

Net flows (490.4) (199.5) (290.8) (117.7) (271.3)

Investment performance/interest credited 1,903.4 (605.1) 1,070.8 2,373.2 825.9 Policy charges (140.6) (141.3) (141.2) (153.1) (154.2) Benefits and other 3.1 15.1 (8.4) (68.7) 6.5 Balance, end of period 42,071.5$ 41,140.7$ 41,771.1$ 43,804.8$ 44,211.7$

Individual Fixed AnnuitiesBalance, beginning of period 8,041.8$ 7,746.6$ 7,425.0$ 6,995.6$ 6,536.1$

Deposits 38.6 42.7 53.3 43.6 44.2 Withdrawals and surrenders (400.9) (437.5) (534.1) (521.3) (470.4)

Net flows (362.3) (394.8) (480.8) (477.7) (426.2)

Policyholder interest credited 73.4 79.2 68.2 63.6 58.1 Policy charges (2.8) (2.5) (3.1) (2.2) (2.1) Benefits and other (3.5) (3.5) (13.7) (43.2) (7.5) Balance, end of period 7,746.6$ 7,425.0$ 6,995.6$ 6,536.1$ 6,158.4$

Income Products 2,025.1$ 1,970.6$ 1,994.0$ 2,025.6$ 2,043.8$ Advisory Services Program 475.0$ 508.1$ 549.2$ 597.1$ 616.8$

Total individual investment account values 52,318.2$ 51,044.4$ 51,309.9$ 52,963.6$ 53,030.7$

9


March 31, 2007

Individual InvestmentsAccount Values by Product


BEST of AMERICA products 34,117.5$ 33,495.1$ 34,215.3$ 36,106.8$ 36,628.6$ Private label annuities 7,505.5 7,243.9 7,171.5 7,319.7 7,233.7 Nationwide Financial Network and other 448.5 401.7 384.3 378.3 349.4

Total individual variable annuities 42,071.5$ 41,140.7$ 41,771.1$ 43,804.8$ 44,211.7$

Individual Fixed Annuities 7,746.6$ 7,425.0$ 6,995.6$ 6,536.1$ 6,158.4$ Income Products 2,025.1$ 1,970.6$ 1,994.0$ 2,025.6$ 2,043.8$ Advisory Services Program 475.0$ 508.1$ 549.2$ 597.1$ 616.8$


Individual InvestmentsSales by Product


BEST of AMERICA products 912.5$ 1,116.3$ 1,096.6$ 1,265.5$ 1,166.9$ Private label annuities 73.0 96.7 94.8 92.1 73.2 Nationwide Financial Network and other 0.9 1.0 1.0 0.7 0.9

Total individual variable annuities 986.4$ 1,214.0$ 1,192.4$ 1,358.3$ 1,241.0$

Individual Fixed Annuities 39.5$ 45.8$ 57.2$ 44.0$ 37.3$ Income Products 58.5$ 55.9$ 57.1$ 59.2$ 55.5$ Advisory Services Program 62.6$ 70.1$ 47.7$ 42.4$ 36.8$

Total individual investment sales 1,147.0$ 1,385.8$ 1,354.4$ 1,503.9$ 1,370.6$

Individual InvestmentsSales by Channel


Non-affiliated Independent broker/dealers 347.7$ 412.6$ 403.1$ 443.1$ 427.9$ Wirehouse and regional firms 220.8 274.4 312.7 363.9 314.0 Financial institutions 318.2 410.6 383.3 446.7 402.4 Life specialists 0.8 - - - 0.1 Affiliated Nationwide agents 63.6 71.3 51.0 59.2 62.3 Nationwide Financial Network 35.3 45.1 42.3 45.4 34.3

Total individual variable annuities 986.4$ 1,214.0$ 1,192.4$ 1,358.3$ 1,241.0$

Individual Fixed AnnuitiesNon-affiliated Independent broker/dealers 2.6$ 2.5$ 5.4$ 2.9$ 5.4$ Wirehouse and regional firms 1.0 3.0 3.1 2.7 3.6 Financial institutions 14.7 19.0 20.5 18.2 14.3 Affiliated Nationwide agents 17.4 19.8 24.7 17.8 12.4 Nationwide Financial Network 3.8 1.5 3.5 2.4 1.6

Total individual fixed annuities 39.5$ 45.8$ 57.2$ 44.0$ 37.3$

Income ProductsNon-affiliated Independent broker/dealers 28.1$ 28.5$ 19.5$ 22.0$ 26.0$ Wirehouse and regional firms 17.0 15.5 25.8 26.4 16.9 Financial institutions 6.1 9.4 7.9 7.3 8.8 Affiliated Nationwide agents 3.6 3.1 2.9 2.0 2.4 Nationwide Financial Network 3.7 (0.6) 1.0 1.5 1.4

Total income products 58.5$ 55.9$ 57.1$ 59.2$ 55.5$

Advisory Services ProgramNon-affiliated Independent broker/dealers 48.0$ 60.2$ 41.3$ 31.0$ 28.7$ Financial institutions 4.0 5.7 2.3 3.5 2.1 Affiliated Nationwide Financial Network 10.6 4.2 4.1 7.9 6.0

Total advisory services program 62.6$ 70.1$ 47.7$ 42.4$ 36.8$


10


March 31, 2007




Net investment income 164.2 159.8 164.7 163.5 165.5 Other income 67.2 68.6 71.1 77.3 76.2


Benefits Interest credited 113.2 113.0 112.2 113.2 111.1


Subtotal 91.5 96.1 97.6 112.4 107.6


Total expenses 102.7 108.2 111.5 120.4 117.8


Key Ratios/StatisticsAverage Account Values: General account 11,241.2$ 11,050.0$ 10,909.6$ 11,079.3$ 11,175.4$ Separate account 19,298.8 18,155.5 17,668.4 18,193.8 18,441.8 Non insurance assets 15,258.6 16,085.7 16,611.8 17,962.0 19,314.3 Administration only 24,941.5 25,476.0 25,834.3 27,135.0 28,314.4

Total average retirement plan account values 70,740.1$ 70,767.2$ 71,024.1$ 74,370.1$ 77,245.9$




Asset fees to average separate account values 0.70% 0.74% 0.74% 0.74% 0.73%



Pre-tax operating earnings to operating revenue 19.9% 22.6% 19.4% 16.1% 18.0%

Average allocated capital 816.2$ 817.1$ 806.7$ 815.4$ 795.0$



($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Private Sector Pension Plans


New deposits/sales 1,791.8 1,420.5 1,427.9 1,563.6 2,006.0 Participant withdrawals and surrenders (1,478.6) (1,239.7) (1,225.2) (1,322.9) (1,520.2)

Net flows 313.2 180.8 202.7 240.7 485.8

Investment performance/interest credited 1,330.8 (382.7) 838.9 1,867.9 598.6 Policy charges and other (23.9) (72.0) (65.8) (65.2) (65.1) Case acquisitions/(terminations), net (1,478.9) - - - (736.7)

Balance, end of period 29,900.0$ 29,626.1$ 30,601.9$ 32,645.3$ 32,927.9$

Public Sector Pension PlansBalance, beginning of period 40,092.0$ 41,729.2$ 40,278.9$ 41,541.2$ 43,951.8$

New deposits/sales 1,020.0 993.2 1,023.4 981.8 1,074.4 Participant withdrawals and surrenders (694.2) (654.2) (567.9) (496.5) (717.3)

Net flows 325.8 339.0 455.5 485.3 357.1

Investment performance/interest credited 1,376.2 (370.1) 914.6 1,882.2 692.4 Policy charges and other (18.0) (38.1) (19.0) (19.7) (19.5) Case acquisitions/(terminations), net (46.8) (1,381.1) (88.8) 62.8 (14.9)


Total retirement plan account values 71,629.2$ 69,905.0$ 72,143.1$ 76,597.1$ 77,894.8$

Account Value Activity

Retirement PlansQuarterly Earnings Trends

Retirement Plans

11


March 31, 2007

Retirement PlansAccount Values by Product


BEST of AMERICA annuity products 7,738.8$ 7,399.3$ 7,360.4$ 7,557.1$ 7,383.9$ BEST of AMERICA trust products 16,037.7 16,133.6 17,089.9 18,834.1 19,794.4

Subtotal BEST of AMERICA 23,776.5 23,532.9 24,450.3 26,391.2 27,178.3

Nationwide Financial Network products 1,316.5 1,304.8 1,256.1 1,268.2 1,020.6 Nationwide employee and agent benefit plans 4,207.1 4,204.7 4,322.0 4,435.6 4,200.4 Other 599.9 583.7 573.5 550.3 528.6

Total private sector pension plans 29,900.0$ 29,626.1$ 30,601.9$ 32,645.3$ 32,927.9$

Public Sector Pension PlansIRC Section 457 annuities 16,148.1$ 14,908.2$ 15,243.4$ 15,979.5$ 16,310.2$ Administration only agreements 25,581.1 25,370.7 26,297.8 27,972.3 28,656.7

Total public sector pension plans 41,729.2$ 40,278.9$ 41,541.2$ 43,951.8$ 44,966.9$


Retirement PlansSales by Product


BEST of AMERICA annuity products 351.0$ 327.8$ 291.0$ 260.4$ 318.5$ BEST of AMERICA trust products 1,277.5 976.9 1,024.5 1,225.1 1,487.4


Nationwide Financial Network products 56.5 40.6 42.9 48.2 35.9 Other 12.6 20.8 15.0 21.0 21.0

Total private sector pension plan 1,697.6$ 1,366.1$ 1,373.4$ 1,554.7$ 1,862.8$

Public Sector Pension PlansIRC Section 457 annuities 407.3$ 389.0$ 381.6$ 355.4$ 389.7$ Administration only agreements 612.6 604.2 641.8 626.3 684.6 Other - - - - -

Total public sector pension plans 1,019.9$ 993.2$ 1,023.4$ 981.7$ 1,074.3$

Total retirement plan sales 2,717.5$ 2,359.3$ 2,396.8$ 2,536.4$ 2,937.1$

Retirement PlansSales by Channel


Non-affiliated Independent broker/dealers 994.7$ 810.4$ 824.6$ 964.3$ 1,157.3$ Wirehouse and regional firms 337.0 245.8 239.7 282.2 326.3 Financial institutions 167.7 120.4 141.2 130.5 148.2 Pension plan administrators 135.9 139.6 124.8 132.5 175.8 Affiliated Nationwide Retirement Solutions 8.6 8.0 7.9 7.5 7.9 Nationwide agents 24.0 20.2 16.2 19.9 29.3 Nationwide Financial Network 29.7 21.7 19.0 17.8 18.0


Public Sector Pension Plans Nationwide Retirement Solutions 1,019.9$ 993.2$ 1,023.4$ 981.7$ 1,074.3$


12


March 31, 2007


Asset fees 11.0$ 11.4$ 11.1$ 12.3$ 12.7$ Administrative fees 22.9 19.7 22.8 17.3 20.1 Surrender fees 6.3 4.9 6.1 5.3 5.0 Cost of insurance 98.9 100.2 100.6 102.3 104.1




Traditional life premiums 75.9 75.1 73.2 74.8 76.9 Other income 7.2 5.9 6.2 6.0 4.1


BenefitsInterest credited 45.6 49.5 49.5 47.1 47.3 Life benefits 115.1 106.8 108.3 114.2 107.0 Policyholder dividends 20.2 24.5 24.6 21.4 21.3

Total benefits 180.9 180.8 182.4 182.7 175.6


Subtotal 66.3 51.4 55.6 55.8 48.8


Total expenses 92.6 92.4 85.2 73.7 84.0


Key Ratios/StatisticsGeneral operating expenses to operating revenues 24.2% 19.9% 20.3% 24.5% 18.3%Pre-tax operating earnings to operating revenues 19.2% 18.1% 21.0% 23.4% 24.2%Average allocated capital 1,829.6$ 1,845.5$ 1,852.3$ 1,869.0$ 1,933.2$ Return on average allocated capital 9.8% 9.2% 10.4% 11.6% 12.1%

Individual ProtectionPolicy Reserves

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Individual investment life 5,573.1$ 5,435.3$ 5,545.3$ 5,842.5$ 5,927.3$ Corporate investment life - excluding experience rated BOLI 5,997.2 6,030.6 6,235.8 6,600.9 6,738.2 Corporate investment life - experience rated BOLI 1,143.6 1,134.2 1,189.8 1,913.5 1,965.7

Subtotal investment life 12,713.9 12,600.1 12,970.9 14,356.9 14,631.2

Traditional life 4,210.3 4,301.0 4,282.9 4,170.9 4,153.8 Universal life 1,108.1 1,129.7 1,158.6 1,159.0 1,169.3

Subtotal fixed life 5,318.4 5,430.7 5,441.5 5,329.9 5,323.1

Total individual protection policy reserves 18,032.3$ 18,030.8$ 18,412.4$ 19,686.8$ 19,954.3$

Individual ProtectionInsurance In Force

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Individual investment life 57,164.1$ 57,336.8$ 57,189.7$ 57,536.7$ 57,748.8$ Corporate investment life - excluding experience rated BOLI 10,633.5 10,730.7 10,904.1 11,451.7 11,560.9 Corporate investment life - experience rated BOLI 13,330.5 13,330.5 13,320.3 13,312.7 13,308.7




Total individual protection insurance in force 127,999.3$ 129,914.1$ 131,460.3$ 133,312.7$ 133,204.8$

Individual Protection Quarterly Earnings Trends

13


March 31, 2007

Individual ProtectionSales by Product

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07BEST of AMERICA Variable Life Series

First year sales 34.2$ 37.8$ 34.3$ 31.7$ 29.4$ Renewal sales 75.9 72.3 72.9 78.2 79.3

Total BEST of AMERICA variable life series 110.1 110.1 107.2 109.9 108.7

Nationwide Financial Network Variable Life ProductsFirst year sales 5.0 9.8 4.5 1.7 1.6 Renewal sales 51.2 41.6 42.7 45.2 50.6 Total Nationwide Financial Network variable life products 56.2 51.4 47.2 46.9 52.2

Corporate Owned Life Insurance (COLI)First year sales 83.5 54.6 10.2 248.3 39.0 Renewal sales 198.7 92.1 57.5 61.0 164.2

Total COLI 282.2 146.7 67.7 309.3 203.2

Traditional/Universal lifeFirst year sales 21.6 23.0 32.5 25.5 19.8 Renewal sales 96.5 102.3 103.3 112.4 103.0

Total traditional/universal life 118.1 125.3 135.8 137.9 122.8

Total individual protection sales 566.6$ 433.5$ 357.9$ 604.0$ 486.9$

Individual ProtectionSales by Channel

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Non-affiliated Independent broker/dealers 66.7$ 66.5$ 70.0$ 62.5$ 63.4$ Wirehouse and regional firms 14.3 16.9 15.1 16.3 18.9 Financial institutions 13.0 15.6 14.9 14.4 14.7 Life specialists 171.8 84.0 46.3 277.7 88.2 Affiliated Nationwide agents 87.8 88.7 91.8 102.8 89.7 Nationwide Financial Network 102.6 99.1 98.4 98.7 97.0 TBG Financial 110.4 62.7 21.4 31.6 115.0

Total individual protection sales 566.6$ 433.5$ 357.9$ 604.0$ 486.9$

14


March 31, 2007

Investment LifeQuarterly Earnings Trends






Other income 7.2 5.9 6.2 6.0 4.1


BenefitsInterest credited 26.8 28.8 29.2 27.6 28.6 Life benefits 39.1 32.1 34.7 35.9 32.1

Total benefits 65.9 60.9 63.9 63.5 60.7


Subtotal 41.2 26.5 30.4 31.1 23.8


Total expenses 59.9 57.7 56.1 59.8 47.4


Key Ratios/Statistics

Cost of insurance per $1,000 of average net amount at risk (1) 6.07$ 6.11$ 6.08$ 6.16$ 6.23$ Life benefits per $1,000 of average net amount at risk (1) 2.78$ 2.28$ 2.46$ 2.54$ 2.27$ General operating expenses to operating revenues 31.4% 22.0% 23.0% 31.4% 21.3%Pre-tax operating earnings to operating revenues 22.2% 24.9% 25.7% 21.4% 32.1%Average allocated capital 1,262.2$ 1,271.9$ 1,275.7$ 1,283.5$ 1,295.1$ Return on average allocated capital 8.3% 9.0% 9.1% 7.9% 11.6%

(1) Excludes experience rated BOLI corporate investment life.

Investment LifePolicy Reserve Activity

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Balance, beginning of period 12,074.1$ 12,713.9$ 12,600.1$ 12,970.9$ 14,356.8$

Deposits 419.9 288.1 320.6 1,180.0 360.8 Withdrawals and surrenders (146.2) (165.5) (128.5) (136.5) (220.9)

Net flows 273.7 122.6 192.1 1,043.5 139.9

Investment performance/interest credited 470.8 (126.7) 326.7 619.6 261.8 Policy charges (121.8) (118.1) (121.3) (116.7) (121.5) Benefits and other 17.1 8.4 (26.7) (160.5) (6.2) Acquired business - - - - - Balance, end of period 12,713.9$ 12,600.1$ 12,970.9$ 14,356.8$ 14,630.8$

15


March 31, 2007

Fixed LifeQuarterly Earnings Trends


Administrative fees 3.4$ 3.2$ 4.1$ 4.3$ 4.1$ Surrender fees 0.7 0.5 0.4 0.8 0.5 Cost of insurance 13.5 14.0 14.8 15.4 15.9


Net investment income 83.3 83.0 84.7 82.7 86.0 Traditional life premiums 75.9 75.1 73.2 74.8 76.9



Total benefits 115.0 119.9 118.5 119.2 114.9


Subtotal 25.1 24.9 25.2 24.7 25.0

Amortization of policy acquisition costs 5.4 7.5 1.2 (12.7) 9.3 Amortization of value of business acquired 2.2 2.3 2.7 1.9 2.3

Total expenses 32.7 34.7 29.1 13.9 36.6


Key Ratios/StatisticsLife benefits per $1,000 of average life insurance in force 6.57$ 6.26$ 5.97$ 6.20$ 5.90$ General operating expenses to operating revenues 17.6% 18.0% 17.8% 18.4% 15.7%Pre-tax operating earnings to operating revenues 16.5% 12.1% 16.7% 25.2% 17.4%Average allocated capital 567.4$ 573.6$ 576.6$ 585.5$ 638.1$ Return on average allocated capital 13.3% 9.6% 13.3% 19.9% 13.0%

Fixed LifePolicy Reserve Activity

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Traditional/Universal Life

Balance, beginning of period 5,314.5$ 5,318.4$ 5,430.7$ 5,441.5$ 5,329.9$ Deposits 106.0 112.3 116.7 120.9 106.7 Withdrawals and surrenders (51.2) (57.2) (50.7) (55.4) (62.1)

Net flows 54.8 55.1 66.0 65.5 44.6

Interest credited 22.7 20.7 20.6 19.9 19.3 Policy charges (17.6) (17.7) (19.3) (20.2) (20.7) Benefits and other (56.0) 54.2 (56.5) (176.8) (50.0) Balance, end of period 5,318.4$ 5,430.7$ 5,441.5$ 5,329.9$ 5,323.1$

16


March 31, 2007

Corporate and OtherQuarterly Earnings Trends

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07

Operating RevenuesNet Investment Income General account assets 90.8$ 102.2$ 95.8$ 109.7$ 115.9$ Periodic net coupon settlements on non-qualifying derivatives (0.3) (0.3) (0.3) (0.5) (0.5)


Operating realized gains (losses) 1.3 1.1 4.1 3.1 2.1 Other income 8.3 8.5 9.2 12.7 24.8


BenefitsInterest Credited Products 45.4 50.4 55.0 57.9 58.1 Periodic net coupon settlements on non-qualifying derivatives 0.2 0.1 - (0.3) 0.1

Total benefits Total benefits 45.6 50.5 55.0 57.6 58.2

ExpensesCommissions 6.1 5.3 7.4 6.7 7.0 General operating expenses 10.8 14.1 (0.5) 16.0 18.9 Amortization of value of business acquired 0.1 - - (0.1) - Interest expense on debt 25.9 25.0 25.2 27.0 24.6

Total expenses 42.9 44.4 32.1 49.6 50.5


Medium Term Notes

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Key Ratios/Statistics

Average Account Values: General account 4,060.1$ 4,084.7$ 4,008.6$ 4,284.7$ 4,473.7$




Account Value ActivityBalance, beginning of period 3,998.2$ 4,122.1$ 4,047.4$ 3,969.9$ 4,599.5$ Deposits 250.0 300.0 - 1,225.0 250.0 Maturities (125.0) (379.4) (73.8) (602.1) (500.0)

Net flows Net flows 125.0 (79.4) (73.8) 622.9 (250.0)

Interest credited and amortization 44.7 52.5 56.6 59.6 59.3 Other benefits - interest payments (45.8) (47.8) (60.3) (52.9) (60.9)


17


March 31, 2007

Customer Funds Managed and Administered

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Individual variable annuities 42,071.5$ 41,140.7$ 41,771.1$ 43,804.8$ 44,211.7$ Individual fixed annuities 7,746.6 7,425.0 6,995.6 6,536.1 6,158.4 Income products 2,025.1 1,970.6 1,994.0 2,025.6 2,043.8 Advisory services program 475.0 508.1 549.2 597.1 616.8

Subtotal individual investments 52,318.2 51,044.4 51,309.9 52,963.6 53,030.7

Private sector pension plans 29,900.0 29,626.1 30,601.9 32,645.3 32,927.9 Public sector pension plans 41,729.2 40,278.9 41,541.2 43,951.8 44,966.9

Subtotal retirement plans 71,629.2 69,905.0 72,143.1 76,597.1 77,894.8

Individual protection investment life 12,713.9 12,600.1 12,970.9 14,356.9 14,631.2 Individual protection fixed life 5,318.4 5,430.7 5,441.5 5,329.9 5,323.1

Subtotal individual protection 18,032.3 18,030.8 18,412.4 19,686.8 19,954.3

Medium term notes 4,122.1 4,047.4 3,969.9 4,599.5 4,347.9 Nationwide Bank - - - 222.3 853.1

Subtotal corporate and other 4,122.1 4,047.4 3,969.9 4,821.8 5,201.0 Customer funds managed and administered 146,101.8$ 143,027.6$ 145,835.3$ 154,069.3$ 156,080.8$

Separate Account Assets by Segment and Fund Type

Q1'06 Q2'06 Q3'06 Q4'06 Q1'07($ in millions)Individual Investments

Equity 32,002.5$ 30,490.7$ 31,275.7$ 33,531.0$ 33,757.2$ Bond 3,809.9 4,134.1 4,355.0 4,499.2 4,666.4 Money market 1,392.0 1,802.4 1,590.5 1,429.1 1,569.5

Subtotal individual investments 37,204.4 36,427.2 37,221.2 39,459.3 39,993.1

Retirement PlansEquity 15,873.7$ 14,709.4$ 14,794.1$ 15,603.8$ 14,413.5$ Bond 1,851.0 1,782.8 1,830.4 1,934.8 2,674.8 Money market 468.2 508.8 514.3 472.4 523.3 Other 541.4 575.7 621.3 616.4 644.5

Subtotal retirement plans 18,734.3 17,576.7 17,760.1 18,627.4 18,256.1

Individual ProtectionEquity 7,653.4$ 7,397.0$ 7,744.9$ 8,672.3$ 8,818.8$ Bond 2,081.8 2,174.1 2,040.9 1,954.8 2,055.1 Money market 600.8 628.1 768.2 1,325.3 1,336.0

Subtotal individual protection 10,336.0 10,199.2 10,554.0 11,952.4 12,209.9

Corporate and OtherEquity 597.2$ 561.7$ 534.0$ 592.5$ 749.2$ Bond 55.3 57.4 50.1 55.9 70.0 Money market 6.5 6.9 7.4 7.2 9.8

Subtotal corporate and other 659.0 626.0 591.5 655.6 829.0

TotalEquity 56,126.8$ 53,158.8$ 54,348.7$ 58,399.6$ 57,738.7$ Bond 7,798.0 8,148.4 8,276.4 8,444.7 9,466.3 Money market 2,467.5 2,946.2 2,880.4 3,234.0 3,438.6 Other 541.4 575.7 621.3 616.4 644.5

Total separate account assets by fund type 66,933.7$ 64,829.1$ 66,126.8$ 70,694.7$ 71,288.1$

18


March 31, 2007

Securities Available-For-Sale

Gross GrossAmortized Unrealized Unrealized Estimated

($ in millions) Cost Gains Losses Fair ValueMarch 31, 2007Fixed maturity securities:

U.S. Treasury securities and obligations of U.S. Government corporations 209.7$ 12.4$ 1.6$ 220.5$ Agencies not backed by the full faith and credit of the U.S. Government 496.1 46.0 1.0 541.1 Obligations of states and political subdivisions 260.4 0.7 5.5 255.6 Debt securities issued by foreign governments 31.2 1.7 0.1 32.8 Corporate securities Public 9,293.5 211.2 100.1 9,404.6 Private 6,306.3 132.1 66.4 6,372.0 Mortgage-backed securities--U.S. Government backed 7,858.4 41.0 78.1 7,821.3 Asset-backed securities 3,699.4 43.0 33.7 3,708.7

Total fixed maturities 28,155.0 488.1 286.5 28,356.6 Equity securities 58.4 11.1 0.5 69.0

Total 28,213.4$ 499.2$ 287.0$ 28,425.6$

December 31, 2006Fixed maturity securities:

U.S. Treasury securities and obligations of U.S. Government corporations 179.0$ 12.2$ 2.1$ 189.1$ Agencies not backed by the full faith and credit of the U.S. Government 564.5 46.2 2.3 608.4 Obligations of states and political subdivisions 274.7 0.7 7.4 268.0 Debt securities issued by foreign governments 36.2 1.7 0.2 37.7 Corporate securities Public 9,732.8 220.0 127.4 9,825.4 Private 6,605.1 131.5 83.8 6,652.8 Mortgage-backed securities--U.S. Government backed 6,946.0 23.8 122.8 6,847.0 Asset-backed securities 3,728.9 45.5 42.8 3,731.6

Total fixed maturities 28,067.2 481.6 388.8 28,160.0 Equity securities 57.2 11.0 0.6 67.6

Total 28,124.4$ 492.6$ 389.4$ 28,227.6$

Aging of Gross Unrealized Losses on Securities Available-For-Sale

Than One Year TotalGross Gross Gross

Estimated Unrealized Estimated Unrealized Estimated Unrealized($ in millions) Fair Value Losses Fair Value Losses Fair Value LossesMarch 31, 2007Fixed maturity securities:

U.S. Treasury securities & obligations of U.S. Government corporations 78.2$ 0.7$ 29.6$ 0.9$ 107.8$ 1.6$ Agencies not backed by the full faith and credit of the U.S. Government 5.0 - 104.8 1.0 109.8 1.0 Obligations of states and political subdivisions 82.9 0.6 149.2 4.9 232.1 5.5 Debt securities issued by foreign governments - - 1.3 0.1 1.3 0.1 Corporate securities Public 2,230.1 23.7 3,250.6 76.4 5,480.7 100.1 Private 1,302.7 13.2 1,989.6 53.2 3,292.3 66.4 Mortgage-backed securities--U.S.. Government backed 658.8 3.1 3,555.6 75.0 4,214.4 78.1 Asset-backed securities 554.4 4.1 1,304.4 29.6 1,858.8 33.7

Total fixed maturities 4,912.1 45.4 10,385.1 241.1 15,297.2 286.5 Equity securities 17.9 0.2 3.4 0.3 21.3 0.5

Total 4,930.0$ 45.6$ 10,388.5$ 241.4$ 15,318.5$ 287.0$

Percentage of gross unrealized losses 16% 84%

December 31, 2006Fixed maturity securities:

U.S. Treasury securities & obligations of U.S. Government corporations 66.5$ 1.0$ 29.9$ 1.1$ 96.4$ 2.1$ Agencies not backed by the full faith and credit of the U.S. Government 31.7 0.1 125.2 2.2 156.9 2.3 Obligations of states and political subdivisions 84.5 1.0 161.9 6.4 246.4 7.4 Debt securities issued by foreign governments 12.8 0.1 1.3 0.1 14.1 0.2 Corporate securities Public 2,627.7 27.8 3,525.8 99.6 6,153.5 127.4 Private 1,288.6 15.0 2,165.1 68.8 3,453.7 83.8 Mortgage-backed securities--U.S.. Government backed 966.9 7.6 4,194.0 115.2 5,160.9 122.8 Asset-backed securities 580.2 4.5 1,475.0 38.3 2,055.2 42.8

Total fixed maturities 5,658.9 57.1 11,678.2 331.7 17,337.1 388.8 Equity securities 17.6 0.3 3.4 0.3 21.0 0.6

Total 5,676.5$ 57.4$ 11,681.6$ 332.0$ 17,358.1$ 389.4$

Percentage of gross unrealized losses 15% 85%

or Equal to One YearUnrealized Losses MoreUnrealized Losses Less Than

19


March 31, 2007

Amortized Fair Amortized Fair($ in millions) Cost Value Cost Value

NAIC Designation Rating Agency Equivalent Designation19,362.3$ 19,351.3$ 19,727.7$ 19,807.0$ 6,928.8 6,997.2 6,787.2 6,875.8 1,091.5 1,101.6 1,100.0 1,108.9

647.8 659.8 511.1 524.9 18.5 27.3 21.1 29.7 18.3 22.8 7.9 10.3

28,067.2$ 28,160.0$ 28,155.0$ 28,356.6$

($ in millions) Apartment March 31, 2007 Office Warehouse Retail & Other TotalNew England 175.2$ 15.2$ 85.9$ 94.4$ 370.7$ Middle Atlantic 177.6 323.3 321.9 181.4 1,004.2 East North Central 95.9 237.6 605.8 515.8 1,455.1 West North Central 38.9 89.5 65.3 143.3 337.0 South Atlantic 184.5 489.1 801.7 680.3 2,155.6 East South Central 30.7 57.5 122.3 154.0 364.5 West South Central 27.3 164.7 177.5 241.1 610.6 Mountain 114.5 136.0 208.9 347.3 806.7 Pacific 348.9 434.9 452.0 360.8 1,596.6

Subtotal - Principal 1,193.5$ 1,947.8$ 2,841.3$ 2,718.4$ 8,701.0$ Valuation allowance (33.0) Unamortized premium 16.1 Change in fair value of hedged mortgage loans and commitments 5.7

Total mortgage loans on real estate, net 8,689.8$

Apartment December 31, 2006 Office Warehouse Retail & Other TotalNew England 176.4$ 15.3$ 99.6$ 84.2$ 375.5$ Middle Atlantic 196.3 328.4 359.2 186.0 1,069.9 East North Central 97.4 245.9 614.4 513.4 1,471.1 West North Central 40.2 90.2 65.9 138.3 334.6 South Atlantic 203.7 489.5 886.4 667.5 2,247.1 East South Central 34.6 58.0 127.8 164.1 384.5 West South Central 52.9 151.6 177.6 232.4 614.5 Mountain 114.7 136.8 206.4 354.9 812.8 Pacific 346.1 431.1 468.8 366.9 1,612.9

Subtotal - Principal 1,262.3$ 1,946.8$ 3,006.1$ 2,707.7$ 8,922.9$ Valuation allowance (36.0) Unamortized premium 17.8 Change in fair value of hedged mortgage loans and commitments 5.1

Total mortgage loans on real estate, net 8,909.8$

Mortgage Loans by Region and Property Type

6 In or near defaultTotal fixed maturities

March 31, 2007

1 Aaa/Aa/A 2 Baa 3 Ba

Credit Quality of Fixed Maturity Securities Available-For-Sale

4 B 5 Caa and lower

December 31, 2006

20


March 31, 2007

Deferred Policy Acquisition Costs

Individual Retirement Individual Corporate($ in millions) Investments Plans Protection and Other TotalThree Months Ended March 31, 2007Balance, beginning of period 1,995.8$ 293.3$ 1,530.1$ 31.8$ 3,851.0$

Capitalization 91.0 9.0 45.1 - 145.1 Amortization (99.5) (9.8) (26.4) - (135.7) Adjustments to unrealized gains and losses on securities available-for-sale and other - - - (40.8) (40.8)

Balance, end of period 1,987.3$ 292.5$ 1,548.8$ (9.0)$ 3,819.6$

Year Ended December 31, 2006Balance, beginning of period 1,997.7$ 294.8$ 1,410.9$ (18.0)$ 3,685.4$

Capitalization 350.8 36.8 200.8 - 588.4 Amortization (352.7) (38.3) (81.6) - (472.6) Adjustments to unrealized gains and losses on securities available-for-sale and other - - - 49.8 49.8

Balance, end of period 1,995.8$ 293.3$ 1,530.1$ 31.8$ 3,851.0$


Capitalization 250.7 37.2 201.1 - 489.0 Amortization (329.3) (47.4) (102.7) - (479.4) Adjustments to unrealized gains and losses on securities available-for-sale and other (4.3) - (0.1) 119.1 114.7



Capitalization 293.6 41.5 204.1 - 539.2 Amortization (276.1) (39.9) (114.4) - (430.4) Adjustments to unrealized gains and losses on securities available-for-sale and other 11.0 - - 111.4 122.4



Capitalization 376.8 43.8 199.5 - 620.1 Amortization (228.3) (45.7) (120.6) - (394.6) Adjustments to unrealized gains and losses on securities available-for-sale and other 18.0 - - 59.5 77.5



Capitalization 414.7 49.2 204.7 - 668.6 Amortization (528.2) (53.7) (92.7) - (674.6) Adjustments to unrealized gains and losses on securities available-for-sale and other 22.5 - 9.8 (213.1) (180.8)


21


March 31, 2007

($ in millions)

Account DAC Annualized Account DAC AnnualizedYear Values Balance Lapse Rate Values Balance Lapse Rate

1 1,157.8$ 80.3$ 4,633.0$ 285.2$ 2 4,698.1 276.5 3,194.1 174.3 3 3,196.1 168.2 3,639.6 186.5 4 3,637.1 180.4 4,425.8 191.2 5 4,397.2 184.1 4,584.6 165.4 6 4,531.8 159.2 4,697.1 169.4 7 4,640.3 162.8 4,599.3 153.3 8 4,454.4 146.6 2,862.0 97.0 9 2,662.3 94.0 2,514.9 89.7 10 2,412.4 87.3 1,934.5 84.0

11-15 6,791.4 286.6 5,635.7 233.9 16-20 1,289.9 49.6 783.7 30.1 21-27 342.9 4.0 300.5 2.3

Total: 44,211.7$ 1,879.6$ 14.4% 43,804.8$ 1,862.3$ 14.6%


1 3,000.3$ 200.6$ 3,748.9$ 253.1$ 2 3,521.0 212.8 4,649.3 259.9 3 4,361.5 224.6 4,844.1 239.2 4 4,519.7 199.0 5,106.3 243.4 5 4,752.0 210.0 4,917.0 206.2 6 4,662.3 189.1 3,813.5 148.0 7 3,569.7 128.5 3,708.0 121.0 8 3,006.1 96.8 2,624.7 101.5 9 2,169.5 84.9 2,315.0 84.8 10 2,029.1 75.5 1,690.1 62.5

11-15 4,386.3 168.0 3,427.8 132.6 16-20 512.5 19.4 316.6 13.6 21-27 306.0 2.2 320.6 2.3

Total: 40,796.0$ 1,811.4$ 13.5% 41,481.9$ 1,868.1$ 12.5%


1 4,500.3$ 310.6$ 3,922.1$ 310.3$ 2 4,638.5 284.0 4,442.5 312.6 3 5,014.8 283.3 4,327.7 303.1 4 4,864.6 275.1 3,564.3 190.1 5 3,886.5 170.6 3,579.4 158.0 6 3,833.3 140.9 2,996.5 132.1 7 3,114.6 116.5 2,817.0 83.2 8 2,685.2 72.8 1,956.2 59.9 9 1,877.4 52.3 1,410.6 40.9 10 1,415.8 35.7 937.1 27.5

11-15 2,493.5 61.0 1,590.1 43.9 16-20 186.4 3.5 143.9 3.0 21-25 325.0 1.2 194.5 1.7

Total: 38,835.9$ 1,807.5$ 12.5% 31,881.9$ 1,666.3$ 14.4%

December 31, 2002

Individual Variable Annuity Deferred Acquisition Costs

March 31, 2007 December 31, 2006

December 31, 2004

December 31, 2003

December 31, 2005

22


March 31, 2007

Individual Retirement Individual Corporate($ in millions) Investments Plans Protection and Other TotalThree Months Ended March 31, 2007Balance, beginning of period 14.1$ 4.9$ 367.5$ 6.2$ 392.7$

Amortization (1.3) (0.4) (8.6) - (10.3) Adjustments to realized and unrealized gains and losses on securities available-for-sale 4.6 (1.4) - - 3.2

Balance, end of period 17.4$ 3.1$ 358.9$ 6.2$ 385.6$

Year Ended December 31, 2006Balance, beginning of period 29.4$ 15.7$ 398.2$ 6.4$ 449.7$

Amortization (6.5) (6.9) (32.6) - (46.0) Adjustments to realized and unrealized gains and losses on securities available-for-sale (8.8) (3.9) 1.9 (0.2) (11.0)



Amortization (7.2) (3.5) (34.2) (0.1) (45.0) Adjustments to realized and unrealized gains and losses on securities available-for-sale 9.5 2.7 2.0 0.1 14.3



Amortization (7.5) (4.7) (40.1) - (52.3) Adjustments to realized and unrealized gains and losses on securities available-for-sale 1.6 1.6 6.9 (0.4) 9.7



Amortization (6.3) (2.0) (38.0) (0.1) (46.4) Adjustments to realized and unrealized gains and losses on securities available-for-sale and other (2.6) (1.5) 3.9 0.3 0.1


Value of Business Acquired

23


March 31, 2007

($ in millions)

Account AccountGMDB Benefit Type Values Gross Net Values Gross Net

Return of premium 9,127.1$ 37.9$ 15.0$ 9,243.7$ 42.9$ 17.1$ Reset 17,795.1 156.1 23.5 17,752.7 177.3 26.0 Ratchet 14,164.4 181.3 21.1 13,651.6 195.2 17.4 Roll-up 547.8 82.4 5.4 568.1 87.7 5.7 Combo 2,577.3 34.2 17.0 2,588.7 30.1 14.9

Subtotal 44,211.7$ 491.9 82.0 43,804.8$ 533.2 81.1

Earnings enhancement 482.6$ 42.9$ 42.9$ 477.8$ 41.1$ 41.1$ Total 534.8$ 124.9$ 574.3$ 122.2$

GAAP GMDB reserves 32.4$ 29.6$ Statutory GMDB reserves 27.5$ 27.3$


Return of premium 9,272.7$ 83.3$ 32.5$ 9,848.6$ 136.8$ 54.1$ Reset 17,130.4 388.0 61.8 18,084.1 751.7 158.1 Ratchet 11,233.2 410.3 31.6 10,322.1 644.5 46.3 Roll-up 629.1 143.8 8.4 707.2 167.5 9.7 Combo 2,530.6 45.7 22.3 2,519.9 39.8 19.2

Subtotal 40,796.0$ 1,071.1 156.6 41,481.9$ 1,740.3 287.4

Earnings enhancement 418.5$ 27.6$ 27.6$ 310.1$ 18.0$ 18.0$ Total 1,098.7$ 184.2$ 1,758.3$ 305.4$

GAAP GMDB reserves 27.2$ - Statutory GMDB reserves 38.4$ -


Return of premium 9,713.8$ 247.8$ 199.8$ 8,743.2$ 832.0$ 736.7$ Reset 17,834.0 1,313.4 579.6 15,272.2 3,532.5 1,842.1 Ratchet 8,433.7 1,008.3 147.8 6,087.5 1,977.1 411.2 Roll-up 725.7 195.8 22.3 675.0 290.9 34.3 Combo 2,128.7 42.0 39.6 1,104.0 114.8 111.6

Subtotal 38,835.9$ 2,807.3 989.1 31,881.9$ 6,747.3 3,135.9

Earnings enhancement 314.1$ 10.9$ 10.9$ 213.1$ 1.7$ 1.7$ Total 2,818.2$ 1,000.0$ 6,749.0$ 3,137.6$

Wghtd. Avg.GMDB Benefit Type 0 to 50 51 to 60 61 to 70 71 to 80 Over 81 Total Attained Age

Return of premium 3.8$ 5.4$ 4.1$ 1.1$ 0.6$ 15.0$ 60 Reset 2.1 5.4 7.9 6.4 1.7 23.5 64 Ratchet 2.2 5.0 7.4 4.3 2.2 21.1 66 Roll-up 0.4 1.0 1.7 1.4 0.9 5.4 70 Combo 1.1 3.1 5.6 4.8 2.4 17.0 68

Subtotal 9.6 19.9 26.7 18.0 7.8 82.0 65

Earnings enhancement 4.5 12.7 17.8 7.9 - 42.9 62Total 14.1$ 32.6$ 44.5$ 25.9$ 7.8$ 124.9$ 64

Definition of GMDB Benefit TypesReturn of premium: provides the greater of account value or total deposits made to the contract less any partial withdrawals and assessments, which is referred to as "net premiums." In general, there is no lock in age for this benefit, however for some contracts, the GMDB reverts to the account value at a specified age, typically age 75.Reset: provides the greater of a return of premium death benefit or the most recent five-year anniversary (prior to lock in age) account value adjusted for withdrawals. For most contracts, this GMDB locks in at age 86 or 90 and for others the GMDB reverts to the account value at age 75, 85, 86 or 90.Ratchet: provides the greater of a return of premium death benefit or the highest "anniversary" account value (prior to age 86) adjusted for withdrawals. Currently, there are three versions of ratchet, with the difference being based on the definition of anniversary: monthaversary - evaluated monthly, annual - evaluated annually, and five-year - evaluated every fifth year. The majority of the business is an annual ratchet.Rollup: provides the greater of a return of premium death benefit or premiums adjusted for withdrawals accumulated at generally 5% simple interest up to the earlier of age 86 or 200% of adjusted premiums. There are two variations of this benefit. For certain contracts, this GMDB locks in at age 86 and for others the GMDB reverts to the account value at age 75.Combo: provides the greater of annual ratchet death benefit or the rollup death benefit. This benefit locks in at either age 81 or 86.Earnings enhancement: provides an enhancement to the death benefit that is a specified percentage of the adjusted earnings accumulated on the contract at the date of death. There are two versions of this benefit, one where the benefit expires at age 86 and a credit of 4% of account value is deposited into the contract and the second where the benefit doesn't have an end age, but has a cap on the payout and is paid upon the first death in a spousal situation. Both benefits have age limitations. This benefit is paid in addition to any other death benefits paid under the contract.

Individual Variable Annuity Guaranteed Minimum Death Benefits

December 31, 2002Net Amount at RiskNet Amount at Risk

December 31, 2004Net Amount at Risk

December 31, 2006

Net Amount at Risk, Net of Reinsurance by Benefit Type and Age at March 31, 2007

March 31, 2007Net Amount at Risk Net Amount at Risk


December 31, 2003

24


March 31, 2007

($ in millions)

Account AccountGMAB Benefit Type Values Gross Net Values Gross Net

5 Year 2,359.1$ 0.4$ 0.4$ 2,131.1$ 0.1$ 0.1$ 7 Year 2,038.0 0.4 0.4 1,865.7 0.1 0.1 10 Year 816.0 0.1 0.1 784.0 - -

Total 5,213.1$ 0.9$ 0.9$ 4,780.8$ 0.2$ 0.2$

CPPLI included in totals 3,380.7$ 0.9$ 0.9$ 2,946.4$ 0.2$ 0.2$

Account AccountGMAB Benefit Type Values Gross Net Values Gross Net

5 Year 1,041.8$ 0.5$ 0.5$ 512.2$ 0.1$ 0.1$ 7 Year 1,103.5 0.2 0.2 647.5 - - 10 Year 595.5 0.1 0.1 332.4 - -

Total 2,740.8$ 0.8$ 0.8$ 1,492.1$ 0.1$ 0.1$

CPPLI included in totals 939.1$ 0.6$ 0.6$ - - -

($ in millions)

Account AccountGMIB Benefit Type Values Gross Net Values Gross Net

Ratchet 444.2$ 0.1$ -$ 450.6$ 0.2$ -$ Roll-up 1,178.5 2.9 - 1,187.1 3.3 - Combo 0.6 - - 0.5 - -

Total 1,623.3$ 3.0$ -$ 1,638.2$ 3.5$ -$


Ratchet 444.7$ 0.3$ -$ 439.7$ 0.7$ -$ Roll-up 1,189.3 5.0 - 1,188.7 7.2 - Combo 0.5 - - 1.0 - -

Total 1,634.5$ 5.3$ -$ 1,629.4$ 7.9$ -$


Ratchet 418.0$ 1.0$ -$ 307.8$ 4.6$ -$ Roll-up 1,132.2 8.6 - 664.4 20.4 - Combo 1.1 - - 0.1 - -

Total 1,551.3$ 9.6$ -$ 972.3$ 25.0$ -$

($ in millions)

Account AccountGLWB Benefit Type Values Gross Net Values Gross Net

L.INC 1,358.4$ -$ -$ 993.8$ -$ -$ Total 1,358.4$ -$ -$ 993.8$ -$ -$

Definition of Benefit Types5 Year, 7 Year, 10 Year: the waiting period required to receive the guaranteed accumulation benefit.Ratchet: provides an annuitization value equal to the greater of account value, net premiums paid or the highest one-year anniversary account value (prior to age 86) adjusted for withdrawals.Rollup: provides an annuitization value equal to the greater of account value and premiums adjusted for withdrawals accumulated at 5% compound interest up to the earlier of age 86 or 200% of adjusted premiums.Combo: provides an annuitization value equal to the greater of account value, ratchet GMIB benefit or rollup GMIB benefit.CPPLI: Capital Preservation Plus Lifetime Income is a living benefit rider that combines a GMAB feature in its first five to 10 years with a lifetime withdrawal benefit which begins upon the maturity of the GMAB and extends for the duration of the insured's life.L.INC: Lifetime Income is a living benefit rider that provides a lifetime withdrawal benefit to the insured. The withdrawal percent is based on the insured's age at the time of the first withdrawal.

Individual Variable Annuity Guaranteed Minimum Income Benefits


Individual Variable Annuity Guaranteed Lifetime Withdrawal Benefits

Net Amount at Risk Net Amount at Risk



Net Amount at Risk Net Amount at Risk






Individual Variable Annuity Guaranteed Minimum Accumulation Benefits

March 31, 2007 December 31, 2006Net Amount at Risk Net Amount at Risk

25


March 31, 2007

Individual Variable Annuity Guaranteed Minimum Death Benefit Reserve Activity

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Balance, beginning of period 27.2$ 26.9$ 30.2$ 31.8$ 29.6$

Expense provision 8.3 8.3 8.4 7.9 8.4 Net claims paid (8.6) (5.0) (6.8) (10.1) (5.6)


Individual Variable Annuity Guaranteed Minimum Accumulation Benefit Embedded Derivative Activity

($ in millions) Q1'06 Q2'06 Q3'06 Q4'06 Q1'07Balance, beginning of period 67.9$ 77.6$ 102.4$ 109.7$ 116.3$

Value of new business sold 26.8 26.0 18.2 24.2 17.7 Change in fair value (17.1) (1.2) (10.9) (17.6) (13.7)


CPPLI included in end of period balance 16.3$ 20.7$ 15.2$ 22.0$ 1.0$

Individual Fixed Annuity and Fixed Option of Variable Annuity Summary of Crediting Rate Detail as of March 31, 2007

Account Wtd. Avg. Account Wtd. Avg.($ in millions) Value Crediting Rate Value Crediting RateMinimum interest rate of 3.50% or greater -$ - 1,220.9$ 4.16%Minimum interest rate of 3.0% to 3.49% 1,937.9 4.53% 4,423.6 3.14%Minimum interest rate lower than 3.00% 845.3 3.33% 397.3 3.51%MVA with no minimum interest rate guarantee - - - -

Total 2,783.2$ 4.17% 6,041.8$ 3.37%

Account Wtd. Avg. Account Wtd. Avg.Value Crediting Rate Value Crediting Rate

Minimum interest rate of 3.50% or greater -$ - 1,220.9 4.16%Minimum interest rate of 3.0% to 3.49% - - 6,361.5 3.56%Minimum interest rate lower than 3.00% 44.7 3.94% 1,287.3 3.41%MVA with no minimum interest rate guarantee 1,620.6 2.87% 1,620.6 2.87%

Total 1,665.3$ 2.90% 10,490.3$ 3.51%

ResetRatchet

TotalMVA & Other

26


March 31, 2007

Historical Financial Highlights

($ in millions except for per share data) 2002 2003 2004 2005 2006Operating Revenues

Individual investments 1,210.4$ 1,392.8$ 1,477.4$ 1,514.5$ 1,514.3$ Retirement plans 898.8 930.5 979.5 1,041.7 1,110.9 Individual protection 1,001.9 1,348.7 1,350.1 1,348.5 1,345.5 Corporate and other 220.4 278.1 310.0 385.0 445.4

Total operating revenues 3,331.5$ 3,950.1$ 4,117.0$ 4,289.7$ 4,416.1$

Net realized gains (losses) on investments, hedging instruments and hedged items (1) (87.6) (86.3) (40.9) 18.2 (0.6)

Total revenues 3,243.9$ 3,863.8$ 4,076.1$ 4,307.9$ 4,415.5$

Pre-tax Operating Earnings (Loss)Individual investments (120.5)$ 182.9$ 234.4$ 237.0$ 210.8$ Retirement plans 142.5 152.8 180.3 187.8 216.5 Individual protection 188.1 215.5 242.7 258.2 274.8 Corporate and other 18.2 54.8 58.6 55.7 67.7

Pre-tax operating earnings 228.3$ 606.0$ 716.0$ 738.7$ 769.8$ Federal income tax expense 25.7 150.1 181.7 126.7 61.9


Net realized gains (losses) on investments, hedging instruments and hedged items, net of taxes (1) (56.9) (56.2) (26.6) 11.9 (0.4)

Adjustment to amortization related to net realized gains (losses), net of taxes - - - (0.5) 6.3

Discontinued operations, net of taxes (1.5) (1.3) (2.3) (24.7) -

Cumulative effect of adoption of accounting principles, net of taxes - (0.6) (3.4) - -

Net income 144.2$ 397.8$ 502.0$ 598.7$ 713.8$

Per Diluted ShareNet operating earnings 1.53$ 2.99$ 3.49$ 3.98$ 4.70$

Net realized gains (losses) on investments, hedging instruments and hedged items, net of taxes (1) (0.43) (0.37) (0.17) 0.08 -

Adjustment to amortization related to net realized gains (losses), net of taxes - - - - 0.04


Cumulative effect of adoption of accounting principles, net of taxes - - (0.02) - -

Net income 1.09$ 2.61$ 3.28$ 3.90$ 4.74$

Sales by ChannelNon-affiliated Independent broker/dealers 4,391.2$ 4,615.1$ 5,223.2$ 5,266.0$ 5,758.2$ Wirehouse and regional firms 2,204.8 1,995.0 1,992.1 1,912.5 2,433.6 Financial institutions 4,180.6 3,758.2 2,618.5 1,808.0 2,295.1 Pension plan administrators 747.4 574.8 476.1 469.0 532.8 Life specialists 510.6 387.5 382.8 382.4 580.6 Affiliated Nationwide Retirement Solutions 2,633.1 3,209.9 3,665.9 3,914.7 4,050.2 Nationwide agents 736.7 686.3 714.3 757.8 787.8 Nationwide Financial Network 274.5 793.6 760.9 658.0 698.7 TBG Financial 146.9 160.9 184.2 275.4 226.1

Total 15,825.8$ 16,181.3$ 16,018.0$ 15,443.8$ 17,363.1$


Note: The results of operations of Cap Pro Holding, Inc., NFS Bermuda and TBG Lynch (a subsidiary of TBG Financial) are reflected as discontinued operations for 2005 and all prior years. In addition, the results of operations of The 401(k) Company are reflected as discontinued operations for 2006 and all prior years.

27


March 31, 2007

($ in millions except for per share data) 2002 2003 2004 2005 2006Balance Sheet Data

Total assets 95,560.3$ 111,088.2$ 116,950.6$ 116,159.9$ 119,411.6$

Total customer funds managed and administered 99,036.6$ 125,171.9$ 137,994.8$ 142,465.2$ 154,069.3$

Shareholder's equity Including AOCI 4,443.3$ 4,875.4$ 5,215.1$ 5,350.4$ 5,538.3$ AOCI 400.3 504.9 432.2 100.7 31.9 Excluding AOCI 4,043.0$ 4,370.5$ 4,782.9$ 5,249.7$ 5,506.4$

Net operating return on average equity excluding AOCI 6.0% 10.9% 11.7% 12.2% 13.1%

Adjusted net operating return on average equity excluding AOCI (1) 6.0% 10.9% 11.7% 11.4% 11.2%

Statutory capital and surplus 2,015.7$ 2,730.0$ 2,967.5$ 3,262.1$ 3,336.6$

Stock DataClosing Price 28.65$ 33.06$ 38.23$ 44.00$ 54.20$

Weighted average shares outstanding Basic 132.4 151.8 152.1 152.9 149.9 Diluted 132.6 152.3 152.9 153.6 150.7

Book value per share Including AOCI 29.25$ 32.10$ 34.20$ 35.08$ 37.93$ Excluding AOCI 26.62$ 28.77$ 31.36$ 34.42$ 37.72$

(1) 2005 return adjusted for $37.9 million impact of one-time tax adjustments associated with separate account dividend received deductions. 2006 return adjusted for $113.1 million of released tax reserves and associated tax-related adjustments relating to prior tax years.


Historical Financial Highlights

28


March 31, 2007

($ in millions) 2002 2003 2004 2005 2006Operating Revenues Asset fees 547.6$ 547.2$ 620.7$ 639.9$ 691.2$ Cost of insurance charges 266.5 371.3 379.7 388.5 402.0 Administrative fees 125.5 107.7 117.9 114.9 139.1 Surrender fees 85.3 94.2 104.3 98.2 83.7

Total policy charges 1,024.9 1,120.4 1,222.6 1,241.5 1,316.0

Traditional life premiums 302.3 426.2 402.7 399.9 441.5 Net investment income 1,892.5 2,198.0 2,231.7 2,343.9 2,298.5 Operating realized gains and (losses) 8.9 15.7 8.7 2.6 9.6 Other income 102.9 189.8 251.3 301.8 350.5


Benefits Interest credited 1,260.7 1,367.6 1,328.3 1,380.9 1,380.3 Life insurance and annuity benefits 392.0 581.7 548.6 574.9 646.8 Policyholder dividends 63.5 105.7 101.4 107.3 90.7

Total benefits 1,716.2 2,055.0 1,978.3 2,063.1 2,117.8

Expenses Commissions 629.0 594.9 565.4 546.7 648.4 General operating expenses 660.1 777.5 811.4 776.1 846.2 Debt extinguishment costs - - - 21.7 - Deferral of policy acquisition costs (668.6) (620.1) (539.2) (489.0) (588.4)

Subtotal 620.5 752.3 837.6 855.5 906.2


Total expenses 1,387.0 1,289.1 1,422.7 1,487.9 1,528.5


Federal income tax expense 25.7 150.1 181.7 126.7 61.9




Realized gains on sales, net of hedging 14.4 69.0 64.8 63.0 59.7 Realized losses on sales, net of hedging (9.8) (20.8) (19.5) (18.4) (48.9) Other-than-temporary impairments, including mortgage loan valuation allowance adjustment (78.6) (110.7) (67.1) (26.9) (11.0) Credit default swaps (4.2) 8.6 0.3 (4.8) (0.8) Derivatives, excluding hedging gains and losses on sales and credit default swaps 6.2 0.8 (3.4) 0.8 (0.4) Amounts credited to policyholder dividend obligation - (3.5) (4.7) (3.3) - Adjustment to VOBA amortization 15.1 0.4 3.0 1.5 1.0

Subtotal (56.9) (56.2) (26.6) 11.9 (0.4)

Adjustment to amortization related to net realized gains (losses), net of taxes - - - (0.5) 6.3


Cumulative effect of adoption of accounting principles, net of taxes - (0.6) (3.4) - -

Net income 144.2$ 397.8$ 502.0$ 598.7$ 713.8$



Historical Consolidated Earnings Trends

29


March 31, 2007

Historical Consolidated Balance Sheet

($ in millions, except per share data) 2002 2003 2004 2005 2006Assets

InvestmentsSecurities available-for-sale: Fixed maturity securities 27,754.2$ 30,787.1$ 31,516.8$ 30,106.0$ 28,160.0$ Equity securities 134.7 128.7 87.0 75.6 67.6 Trading assets - 4.9 15.9 34.4 24.3 Mortgage loans 8,486.5 8,964.7 9,267.5 9,148.6 8,909.8 Real estate 145.6 123.4 108.3 108.7 76.7 Policy loans 986.4 963.2 987.2 930.6 966.9 Other long-term investments 205.0 194.6 604.2 691.9 780.1 Short-term investments 1,420.1 1,970.3 2,009.9 2,073.2 2,215.6

Total investments 39,132.5 43,136.9 44,596.8 43,169.0 41,201.0

Cash 21.7 11.5 52.4 16.4 20.2 Accrued investment income 402.4 439.6 428.7 396.3 373.8 Deferred policy acquisition costs 3,026.9 3,329.9 3,561.1 3,685.4 3,851.0 Value of business acquired 569.3 523.0 480.4 449.7 392.7 Other intangible assets 58.7 52.3 48.7 45.6 43.6 Goodwill 399.4 406.7 382.3 364.5 359.0 Other assets 1,601.1 2,250.7 2,497.0 2,069.2 2,475.6 Assets held in separate accounts 50,348.3 60,937.6 64,903.2 65,963.8 70,694.7

Total assets 95,560.3$ 111,088.2$ 116,950.6$ 116,159.9$ 119,411.6$

Liabilities and shareholders' equityFuture policy benefits and claims 36,274.3$ 40,049.3$ 41,077.2$ 39,748.1$ 38,097.8$ Short-term debt 2.7 205.3 230.8 252.3 85.2 Long term debt 1,197.6 1,405.6 1,406.0 1,398.0 1,398.5 Other liabilities 3,294.1 3,615.0 4,118.3 3,447.3 3,597.1 Liabilities related to separate accounts 50,348.3 60,937.6 64,903.2 65,963.8 70,694.7

91,117.0 106,212.8 111,735.5 110,809.5 113,873.3

Shareholders' equity 4,443.3 4,875.4 5,215.1 5,350.4 5,538.3 Total liabilities and shareholders' equity 95,560.3$ 111,088.2$ 116,950.6$ 116,159.9$ 119,411.6$

Capital Structure

2002 2003 2004 2005 2006

Total capital, including AOCI 5,640.9$ 6,281.0$ 6,621.1$ 6,748.4$ 6,936.8$ Less AOCI 400.3 504.9 432.2 100.7 31.9 Total capital, excluding AOCI 5,240.6$ 5,776.1$ 6,188.9$ 6,647.7$ 6,904.9$

Leverage including AOCI Long-term debt--to--total capital 21.2% 22.4% 21.2% 20.7% 20.2%

Leverage excluding AOCI Long-term debt--to--total capital 22.9% 24.3% 22.7% 21.0% 20.3%

Ratio of pre-tax operating earnings before interestexpense to interest expense 4.0X 7.3X 8.0X 7.8X 8.4X

30


March 31, 2007

Individual Investments

($ in millions) 2002 2003 2004 2005 2006Operating Revenues



Net Investment IncomeGeneral account assets 717.4 886.5 895.3 895.9 806.3 Charge for invested capital (36.4) (26.1) (22.5) (26.0) (25.2)


Premiums on income products 69.4 93.4 90.8 102.9 142.5 Other income - - 0.4 1.5 2.3


Benefits Interest credited 513.2 637.5 606.1 589.1 528.3 Immediate annuity benefits 55.1 82.0 76.1 89.2 126.9 Policy benefits 61.6 78.5 63.1 66.2 75.5

Total benefits 629.9 798.0 745.3 744.5 730.7


Subtotal 169.5 177.3 214.1 196.5 213.6


Total expenses 701.0 411.9 497.7 533.0 572.8

Pre-tax operating earnings (loss) (120.5)$ 182.9$ 234.4$ 237.0$ 210.8$

Key Ratios/StatisticsAverage Account Values:

General account 10,793.7$ 15,340.9$ 16,211.1$ 15,966.7$ 14,041.3$ Separate account 30,091.0 29,170.6 34,198.8 35,600.5 37,223.3 Advisory services program - 7.8 99.1 309.3 508.1

Total average individual investment account values 40,884.7$ 44,519.3$ 50,509.0$ 51,876.5$ 51,772.7$




Total asset fees to average separate account values 1.25% 1.27% 1.27% 1.30% 1.37%


Pre-tax operating earnings (loss) to average account values (0.29%) 0.41% 0.46% 0.46% 0.41%

Pre-tax operating earnings (loss) to operating revenues (10.0%) 13.1% 15.9% 15.6% 13.9%

Average allocated capital 1,658.8$ 1,805.6$ 1,747.0$ 1,671.0$ 1,499.3$

Return on average allocated capital (2.9%) 8.2% 10.4% 13.0% 11.7%

Note: The results of operations of NFS Bermuda are reflected as discontinued operations for 2005 and all prior years.

Individual InvestmentsAccount Value Activity

($ in millions) 2002 2003 2004 2005 2006Individual Variable Annuities


Deposits 5,038.1 5,023.8 4,409.2 3,661.2 5,034.9 Withdrawals and surrenders (4,852.1) (4,347.8) (4,964.4) (5,574.2) (6,133.3)

Net flows 186.0 676.0 (555.2) (1,913.0) (1,098.4)

Investment performance/interest credited (4,852.6) 6,757.7 3,681.9 2,922.1 4,742.3 Policy charges (459.7) (437.2) (515.0) (543.4) (576.2) Benefits and other (0.6) (42.5) 34.3 9.0 (58.9) Acquisitions/(terminations), net 663.1 - - (1,160.6) -


Individual Fixed AnnuitiesBalance, beginning of period 4,250.2$ 7,338.1$ 8,630.7$ 8,902.5$ 8,041.8$

Deposits 2,392.3 1,553.4 672.9 160.9 178.2 Withdrawals and surrenders (474.4) (605.1) (753.6) (1,044.0) (1,893.8)

Net flows 1,917.9 948.3 (80.7) (883.1) (1,715.6)

Policyholder interest credited 298.6 364.8 362.7 327.7 284.4 Policy charges (3.6) (8.1) (9.9) (11.4) (10.6) Benefits and other (2.8) (12.4) (0.3) (4.3) (63.9) Acquisitions/(terminations), net 877.8 - - (289.6) -


Income Products 1,676.5$ 1,840.7$ 1,901.6$ 1,978.3$ 2,025.6$ Advisory Services Program -$ 26.6$ 195.9$ 411.5$ 597.1$


Historical Earnings Trends

31


March 31, 2007

Individual Investments


BEST of AMERICA products 25,880.2$ 31,058.5$ 33,573.0$ 32,937.0$ 36,106.8$ Private label annuities 5,339.5 7,123.4 7,350.9 7,398.9 7,319.7 Nationwide Financial Network and other 662.2 654.0 558.0 460.1 378.3


Individual Fixed Annuities 7,338.1$ 8,630.7$ 8,902.5$ 8,041.8$ 6,536.1$ Income Products 1,676.5$ 1,840.7$ 1,901.6$ 1,978.3$ 2,025.6$ Advisory Services Program -$ 26.6$ 195.9$ 411.5$ 597.1$


Individual InvestmentsSales by Product


BEST of AMERICA products 3,824.7$ 4,066.8$ 3,674.3$ 3,135.5$ 4,390.9$ Private label annuities 795.3 659.3 449.0 346.6 356.6 Nationwide Financial Network and other 2.5 9.3 7.0 4.7 3.6


Advisory Services Program -$ 25.7$ 181.0$ 231.3$ 222.8$ Total individual investment sales 7,330.3$ 6,738.8$ 5,338.5$ 4,109.2$ 5,391.1$

Individual InvestmentsSales by Channel


Non-affiliated Independent broker/dealers 1,750.1$ 1,683.7$ 1,534.6$ 1,304.3$ 1,606.5$ Wirehouse and regional firms 1,264.1 1,086.4 991.6 821.9 1,171.8 Financial institutions 1,313.9 1,657.0 1,270.8 1,031.5 1,558.8 Life specialists - 3.4 2.3 0.3 0.8 Affiliated Nationwide Retirement Solutions - - - - - Nationwide agents 214.8 185.3 224.6 230.3 245.1 Nationwide Financial Network 79.6 119.6 106.4 98.5 168.1


Individual Fixed AnnuitiesNon-affiliated Independent broker/dealers 47.3$ 48.7$ 17.1$ 7.0$ 13.4$ Wirehouse and regional firms 133.0 58.0 20.6 8.2 9.8 Financial institutions 2,224.0 1,628.7 774.3 129.4 72.4 Pension plan administrators 3.4 - - - - Affiliated Nationwide Retirement Solutions 13.2 - - - - Nationwide agents 126.0 60.7 38.6 44.3 79.7 Nationwide Financial Network 17.7 28.4 8.2 5.5 11.2

Total individual fixed annuities 2,564.6$ 1,824.5$ 858.8$ 194.4$ 186.5$

Income ProductsNon-affiliated Independent broker/dealers 61.9$ 75.6$ 70.8$ 76.9$ 98.1$ Wirehouse and regional firms 14.2 44.9 52.2 63.4 84.7 Financial institutions 65.4 15.5 23.4 29.2 30.7 Pension plan administrators - - - - - Affiliated Nationwide Retirement Solutions - - - - - Nationwide agents 1.7 7.5 8.7 12.7 11.6 Nationwide Financial Network - 9.7 13.3 14.5 5.6

Total income products 143.2$ 153.2$ 168.4$ 196.7$ 230.7$

Advisory Services ProgramNon-affiliated Independent broker/dealers -$ 21.2$ 160.0$ 205.3$ 180.5$ Wirehouse and regional firms - - - - - Financial institutions - 3.0 8.9 8.1 15.5 Pension plan administrators - - - - - Affiliated Nationwide Financial Network - 1.5 12.1 17.9 26.8

Total advisory services program -$ 25.7$ 181.0$ 231.3$ 222.8$


Account Values by Product

32


March 31, 2007

Retirement Plans




Net investment income 655.3 662.9 647.6 661.4 652.2 Benefits

Interest credited 467.8 458.9 446.1 455.0 451.6


Subtotal 235.1 271.1 308.5 348.0 397.6

Amortization of policy acquisition costs 53.7 45.7 39.9 47.4 38.3 Amortization of value of business acquired (0.3) 2.0 4.7 3.5 6.9

Total expenses 288.5 318.8 353.1 398.9 442.8


Key Ratios/StatisticsAverage Account Values:

General account 8,888.5$ 9,786.0$ 10,175.6$ 10,881.2$ 11,093.0$ Separate account 19,505.3 18,743.7 20,287.9 19,792.0 18,512.4 Non insurance assets 2,142.2 4,312.4 8,315.6 12,500.3 16,515.0 Administration only 11,349.8 17,184.0 21,995.8 24,289.9 25,904.7

Total average retirement plan account values 41,885.8$ 50,026.1$ 60,774.9$ 67,463.4$ 72,025.1$




Total asset fees to average separate account values 0.78% 0.78% 0.74% 0.70% 0.72%



Pre-tax operating earnings to operating revenues 15.8% 16.4% 18.4% 18.0% 19.5%

Average allocated capital 611.7$ 689.2$ 724.4$ 773.9$ 815.1$



Retirement PlansAccount Value Activity

($ in millions) 2002 2003 2004 2005 2006Private Sector Pension Plans



Net flows 917.9 1,000.6 1,311.9 1,383.9 937.4

Investment performance/interest credited (1,843.5) 3,811.9 2,596.3 2,083.3 3,654.9 Policy charges and other (148.3) (193.3) (194.3) (211.5) (226.9) Net, case acquisitions/(terminations) (57.0) - - - (1,478.9) Acquired business 1,531.2 - - - -


Public Sector Pension PlansBalance, beginning of period 26,076.2$ 23,537.6$ 34,545.4$ 38,925.2$ 40,092.0$


Net flows 499.8 1,300.6 1,394.6 1,242.7 1,605.6

Investment performance/interest credited (2,205.4) 4,781.0 2,869.6 2,577.1 3,802.9 Policy charges and other (62.3) (57.6) (65.8) (69.4) (94.8) Net, case acquisitions/(terminations) (770.7) 4,983.8 181.4 (2,583.6) (1,453.9)




33


March 31, 2007




Nationwide Financial Network products 1,494.5 1,584.1 1,483.7 1,378.4 1,268.2 Nationwide employee and agent benefit plans 3,954.2 4,530.2 4,985.3 5,504.2 4,435.6 Other 613.7 644.5 629.9 604.8 550.3





Retirement PlansSales by Product




Nationwide Financial Network products 95.4 366.4 335.8 205.9 188.2 Other 46.8 31.0 28.1 75.8 69.4





Retirement PlansSales by Channel


Non-affiliated Independent broker/dealers 2,243.0$ 2,534.6$ 3,154.4$ 3,412.0$ 3,594.0$ Wirehouse and regional firms 726.5 742.2 863.7 953.7 1,104.7 Financial institutions 519.0 411.4 493.3 551.2 559.8 Pension plan administrators 744.0 574.8 476.1 469.0 532.8 Affiliated Nationwide Retirement Solutions 38.1 32.5 28.8 33.0 32.0 Nationwide agents 45.6 58.1 71.2 95.5 80.3 Nationwide Financial Network 54.2 188.9 188.1 113.3 88.2


Public Sector Pension Plans Nationwide Retirement Solutions 2,581.8$ 3,177.4$ 3,637.1$ 3,881.7$ 4,018.2$


Account Values by ProductRetirement Plans

34


March 31, 2007

Individual Protection






Traditional life premiums 232.9 332.8 311.9 297.0 299.0 Other income 16.5 33.3 32.9 29.8 25.3



Total benefits 527.0 720.2 700.2 717.5 726.8


Subtotal 182.0 254.4 252.8 235.6 229.1

Amortization of policy acquisition costs 92.7 120.6 114.4 102.7 81.6 Amortization of value of business acquired 12.2 38.0 40.1 34.2 32.6 Interest expense on debt (0.1) - (0.1) 0.3 0.6

Total expenses 286.8 413.0 407.2 372.8 343.9


Key Ratios/StatisticsGeneral operating expenses to operating revenues 23.2% 23.6% 23.3% 22.7% 22.2%Pre-tax operating earnings to operating revenues 18.8% 16.0% 18.0% 19.1% 20.4%Average allocated capital 1,224.2$ 1,722.4$ 1,731.1$ 1,788.9$ 1,849.2$ Return on average allocated capital 10.4% 8.4% 9.5% 10.2% 10.3%

Note: The results of operations of NFS Bermuda and TBG Lynch (a subsidiary of TBG Financial) are reflected as discontinued operations for 2005 and all prior years.

Individual ProtectionPolicy Reserves

($ in millions) 2002 2003 2004 2005 2006Individual investment life 3,514.8$ 4,443.8$ 4,962.1$ 5,329.5$ 5,842.5$ Corporate investment life - excluding experience rated BOLI 3,652.8 4,401.5 5,063.0 5,613.8 6,600.9 Corporate investment life - experience rated BOLI - - 381.1 1,130.8 1,913.5


Traditional life 4,154.9 4,155.0 4,278.9 4,225.2 4,170.9 Universal life 836.4 896.8 997.9 1,089.3 1,159.0


Total individual protection policy reserves 12,158.9$ 13,897.1$ 15,683.0$ 17,388.6$ 19,686.8$

Individual ProtectionInsurance In Force

($ in millions) 2002 2003 2004 2005 2006Individual investment life 55,581.0$ 56,478.4$ 56,836.7$ 57,021.7$ 57,536.7$ Corporate investment life - excluding experience rated BOLI 8,387.1 9,263.3 9,774.3 10,305.0 11,451.7 Corporate investment life - experience rated BOLI - - 1,129.8 13,330.5 13,312.7




Total individual protection insurance in force 106,849.0$ 107,820.3$ 109,225.7$ 126,361.1$ 133,312.7$


35


March 31, 2007

Individual Protection

($ in millions) 2002 2003 2004 2005 2006BEST of AMERICA Variable Life Series

First year sales 229.7$ 131.1$ 131.7$ 121.9$ 138.0$ Renewal sales 288.5 304.3 307.9 304.1 299.3

Total BEST of AMERICA variable life series 518.2 435.4 439.6 426.0 437.3

Nationwide Financial Network Variable Life ProductsFirst year sales 13.6 35.1 32.0 24.0 21.0 Renewal sales 55.0 229.1 223.8 205.0 180.7

Total Nationwide Financial Network variable life products 68.6 264.2 255.8 229.0 201.7

Corporate Owned Life Insurance (COLI)First year sales 247.6 173.2 157.0 227.8 396.6 Renewal sales 409.9 371.8 407.5 429.7 409.3

Total COLI 657.5 545.0 564.5 657.5 805.9

Traditional/Universal lifeFirst year sales 40.1 77.6 114.6 111.4 102.6 Renewal sales 258.9 400.3 392.3 401.3 414.5

Total traditional/universal life 299.0 477.9 506.9 512.7 517.1

Total individual protection sales 1,543.3$ 1,722.5$ 1,766.8$ 1,825.2$ 1,962.0$

Individual ProtectionSales by Channel

($ in millions) 2002 2003 2004 2005 2006Non-affiliated Independent broker/dealers 288.9$ 251.2$ 286.3$ 260.5$ 265.7$ Wirehouse and regional firms 67.0 63.5 64.0 65.3 62.6 Financial institutions 58.3 42.6 47.8 58.6 57.9 Life specialists 510.6 384.1 380.5 382.1 579.8 Affiliated Nationwide agents 348.6 374.7 371.2 375.0 371.1 Nationwide Financial Network 123.0 445.5 432.8 408.3 398.8 TBG Financial 146.9 160.9 184.2 275.4 226.1

Total individual protection sales 1,543.3$ 1,722.5$ 1,766.8$ 1,825.2$ 1,962.0$

Sales by Product

36


March 31, 2007

Investment Life






Other income 16.5 33.3 32.9 29.8 25.3 - -


BenefitsInterest credited 115.0 120.7 117.0 116.3 112.4 Life benefits 82.2 118.2 128.1 128.4 141.8

Total benefits 197.2 238.9 245.1 244.7 254.2


Subtotal 106.7 149.6 144.3 131.6 129.2

Amortization of policy acquisition costs 67.0 91.7 85.1 85.7 80.2 Amortization of value of business acquired 12.5 27.4 22.5 25.1 23.5 Interest expense on debt (0.1) - (0.1) 0.3 0.6

Total expenses 186.1 268.7 251.8 242.7 233.5


Key Ratios/Statistics

Cost of insurance per $1,000 of average net amount at risk (1) 5.86$ 5.84$ 5.88$ 6.01$ 6.10$ Life benefits per $1,000 of average net amount at risk (1) 2.10$ 2.08$ 2.25$ 2.28$ 2.51$ General operating expenses to operating revenues 30.6% 32.4% 30.2% 27.5% 27.0%Pre-tax operating earnings to operating revenues 21.8% 19.5% 22.6% 25.1% 23.5%Average allocated capital 819.0$ 1,143.4$ 1,191.5$ 1,246.1$ 1,273.2$ Return on average allocated capital 9.0% 7.5% 8.5% 9.7% 8.5%

(1) Excludes experience rated BOLI corporate investment life.

Investment LifePolicy Reserve Activity

($ in millions) 2002 2003 2004 2005 2006Balance, beginning of period 5,440.5$ 7,167.6$ 8,845.3$ 10,406.2$ 12,074.1$

Deposits 1,303.5 1,242.4 1,642.7 2,153.8 2,208.6 Withdrawals and surrenders (198.5) (464.4) (467.4) (780.8) (576.7)

Net flows 1,105.0 778.0 1,175.3 1,373.0 1,631.9

Investment performance/interest credited (405.2) 1,357.0 842.8 731.6 1,290.4 Policy charges (343.5) (468.0) (478.0) (481.4) (477.9) Benefits and other 20.0 10.7 20.8 46.2 (161.7) Acquired business 1,350.8 - - (1.5) - Balance, end of period 7,167.6$ 8,845.3$ 10,406.2$ 12,074.1$ 14,356.8$

37


March 31, 2007

Fixed Life


Administrative fees 9.1$ 11.2$ 13.9$ 14.3$ 15.0$ Surrender fees 1.0 0.8 0.8 1.6 2.4 Cost of insurance 37.4 40.1 44.8 49.5 57.7


Net investment income 231.6 333.4 337.0 335.5 333.7 Traditional life premiums 232.9 332.8 311.9 297.0 299.0



Total benefits 329.8 481.3 455.1 472.8 472.6


Subtotal 75.3 104.8 108.5 104.0 99.9

Amortization of policy acquisition costs 25.7 28.9 29.3 17.0 1.4 Amortization of value of business acquired (0.3) 10.6 17.6 9.1 9.1

Total expenses 100.7 144.3 155.4 130.1 110.4


Key Ratios/StatisticsLife benefits per $1,000 of average life insurance in force 5.56$ 7.15$ 6.77$ 6.70$ 6.25$ General operating expenses to operating revenues 16.2% 15.9% 17.1% 18.3% 18.0%Pre-tax operating earnings to operating revenues 15.9% 12.9% 13.8% 13.6% 17.6%Average allocated capital 405.3$ 579.0$ 539.6$ 542.9$ 576.1$ Return on average allocated capital 13.0% 10.4% 11.8% 11.4% 14.1%

Fixed LifePolicy Reserve Activity

($ in millions) 2002 2003 2004 2005 2006Traditional/Universal Life


Deposits 294.0 441.0 457.6 448.6 455.9 Withdrawals and surrenders (128.0) (188.9) (196.9) (214.0) (214.5)

Net flows 166.0 252.1 260.7 234.6 241.4

Interest credited 73.2 72.6 72.4 74.4 83.9 Policy charges (47.5) (52.1) (59.5) (65.4) (74.8) Benefits and other (99.4) (212.1) (48.6) (205.9) (235.1) Acquired business 2,240.3 - - - -



38


March 31, 2007


39


March 31, 2007

Corporate and Other


Net investment income General account assets 200.1$ 219.0$ 247.6$ 337.6$ 398.5$ Periodic net coupon settlements on non-qualifying derivatives (5.6) (6.9) (4.2) (0.1) (1.4)


Realized gain on securitizations - - - - - Operating realized gains (losses) 8.9 15.7 8.7 2.6 9.6 Other income 17.0 50.3 57.9 44.9 38.7


BenefitsInterest credited Products 88.2 69.1 84.2 144.9 208.7 Periodic net coupon settlements on non-qualifying derivatives 3.3 8.8 2.5 1.2 -

Total benefits 91.5 77.9 86.7 146.1 208.7

ExpensesCommissions 7.7 21.0 23.8 25.6 25.5 General operating expenses 26.2 28.5 38.4 28.1 40.4 Amortization of value of business acquired - 0.1 - 0.1 - Debt extinguishment costs - - - 21.7 - Interest expense on debt 76.8 95.8 102.5 107.7 103.1

Total expenses 110.7 145.4 164.7 183.2 169.0

Pre-tax operating earnings (loss) 18.2$ 54.8$ 58.6$ 55.7$ 67.7$

Note: The results of operations of Cap Pro Holding, Inc. and NFS Bermuda are reflected as discontinued operations for 2005 and all prior years.

Medium Term Notes

($ in millions) 2002 2003 2004 2005 2006Key Ratios/Statistics

Average Account Values: General account 3,903.0$ 4,442.8$ 4,647.6$ 4,124.0$ 4,147.4$




Account Value ActivityBalance, beginning of period 3,128.1$ 4,273.6$ 4,606.3$ 4,401.6$ 3,998.2$

Deposits 1,175.0 725.0 900.0 900.0 1,775.0 Maturities - (389.7) (1,115.2) (1,305.4) (1,180.3)

Net flows 1,175.0 335.3 (215.2) (405.4) 594.7

Interest credited and amortization 88.8 69.6 88.4 151.2 213.4 Other benefits - interest payments (118.3) (72.2) (77.9) (149.2) (206.8) Balance, end of period 4,273.6$ 4,606.3$ 4,401.6$ 3,998.2$ 4,599.5$


40


March 31, 2007

Glossary

Advisory services program - Investment products, including mutual funds, separately managed accounts and variable annuities, provided with advice services, such as asset allocation profiling, through an asset-based fee compensation model.

Allocated capital - A non-GAAP financial measure that is calculated by adding target surplus (calculated as 225% of NAIC defined risk based capital), to the following after-tax amounts: unamortized DAC, the difference between statutory benefit reserves and GAAP benefit reserves, the difference between GAAP invested assets and statutory invested assets, unamortized VOBA, unamortized deferred software costs, unamortized intangible assets, unamortized goodwill, unamortized debt issue costs, unamortized deferred revenue, less deferred premiums.

Annuity - A contract that provides a periodic stream of cash flows at regular intervals for a specified period of time, such as number of years or for life.

Asset fees to average separate account values - A financial measure that is calculated by dividing asset fees by average separate account values.

Average allocated capital - A non-GAAP financial measure that is calculated by taking the mean average of the beginning and ending allocated capital amounts of a quarter for a quarterly average, or the mean average of the beginning of the year allocated capital amount and the ending allocated capital amounts for each of the four quarters for a yearly average.

Average equity - A non-GAAP financial measure that is calculated by taking the mean average of the beginning and ending shareholder’s equity, excluding accumulated other comprehensive income for a quarterly average, or the mean average of the beginning of the year shareholder’s equity excluding accumulated other comprehensive income and the ending shareholder’s equity, excluding accumulated other comprehensive income for each of the four quarters for a yearly average.

Average in force - A metric that is calculated by taking the mean average of the beginning and ending in force amounts of a quarter for a quarterly average, or the mean average of the beginning of the year in force amount and the ending in force amounts for each of the four quarters for a yearly average.

BOLI (Bank Owned Life Insurance) - Generally refers to a large single premium purchase of a Modified Endowment Contract to informally fund a block of employee benefit liabilities.

Book value per share excluding accumulated other comprehensive income - A non-GAAP financial measure that is calculated by adjusting book value to exclude accumulated other comprehensive income and then dividing the result by the number of shares outstanding on the date indicated.

COLI (Corporate Owned Life Insurance) - Broadly describes the use of life insurance to informally fund a block of employee benefits. In its truest form refers to corporate owned life insurance but could also refer to other ownership arrangements such as split-dollar.

Cost of Insurance per $1,000 of average net amount at risk - A non-GAAP financial measure that is calculated by annualizing the cost of insurance and dividing by the net amount at risk divided by one thousand.

Credited Rate - A financial measure that is calculated by dividing interest credited by average general account values.

Deferred Annuity - An annuity that can be paid either with a single premium or a series of installments, providing for the income payments to begin at some future date.

Deferred Compensation Plan - A benefit plan that allows an employee to save pre-tax dollars. Many are set up similar to a 401(k) plan, including multiple investment options, but without regulated limits on the amount that can be deposited.

41


March 31, 2007

Glossary

Deferred Policy Acquisition Costs - The unamortized policy acquisition costs which are capitalized and charged to expense in proportion to premiums or estimated gross profits depending on the type of underlying contract. See Policy Acquisition Costs.

Defined Benefit Plan - A qualified pension plan under Section 401 of the Internal Revenue code which defines the retirement benefit to plan participants. The definition of the retirement benefit may include such variables as age, length of service, and compensation, but it would not reflect the investment experience of the assets held to fund these benefits.

Defined Contribution Plan - A benefit plan under which contributions are fixed in advance by formula, and benefits to retiring employees may vary.

Deposits - Premiums received for interest sensitive life insurance, annuities or life insurance products.

Dollar Cost Averaging - Paying a fixed amount of premium at regular intervals regardless of the unit values of the selected variable accounts or the current interest rate on new premiums paid into the guaranteed account.Earned Rate - A financial measure that is calculated by dividing net investment income by average general account values.

Fixed Annuity - An annuity contract in which premiums paid are credited with a fixed rate of return by the life insurance company.

GAAP - Refers to accounting principles generally accepted in the United States of America.

General Account - An undivided account in which all investments are held that are not held in the separate account.

General operating expenses to average account values - A GAAP financial measure that is calculated by dividing general operating expenses by average account values.

Group Annuity - A pension plan providing annuities at retirement to a group of people under a master contract. It usually is issued to an employer for the benefit of employees.

Immediate Annuity - An annuity providing for payment to begin immediately after a single premium is paid.

Internal Replacement - Transaction whereby a policyholder's existing insurance product or investment contract is replaced with a similar product issued by the same entity.

Interest spread on average general account assets - A financial measure that is calculated by subtracting the credited rate from the earned rate.

Lapse - Termination of a policy because of failure to pay the premium.

Leverage, excluding AOCI - A non-GAAP financial measure that is calculated by dividing long-term debt by total capital, excluding accumulated other comprehensive income (AOCI).

Leverage, including AOCI - A financial measure that is calculated by dividing long-term debt by total capital.

Life benefits per $1,000 of average net amount at risk - A metric that is calculated by annualizing the life insurance benefit amount and dividing by the average net amount at risk divided by one thousand, excluding separate account corporate investment life business.

Life benefits per $1,000 of average in force - A metric that is calculated by annualizing the life insurance benefit amount and dividing by the average in force amount divided by one thousand, excluding separate account corporate investment life business.

42


March 31, 2007

Glossary

Life Insurance In Force - The sum of the face amounts, plus dividend additions, of life insurance policies outstanding at a given time.

Nationwide Financial Network - Refers to the affiliated distribution channel that was formerly referred to as Nationwide Provident Producers.

Net Amount at Risk - Insurance in force less accumulated account value. Pertains to investment life products and is the amount for which cost of life insurance is assessed.

Net operating earnings - A non-GAAP financial measure that is calculated by adjusting net income to exclude net realized gains and losses on investments not related to operating items (periodic net coupon settlements on non-qualifying derivatives, trading portfolio realized gains and losses, trading portfolio valuation changes, and net realized gains and losses related to securitizations), hedging instruments and hedged items, adjustment to amortization related to net realized gains and losses, discontinued operations and cumulative effect of adoption of accounting principles, if any, all net of tax.

Net operating earnings per diluted share - A non-GAAP financial measure that is calculated by dividing net operating earnings by the number of weighted average diluted shares outstanding for the period indicated.

Non-GAAP financial measures - Key performance indicators used by management that have not been calculated in accordance with GAAP. None of these non-GAAP financial measures should be viewed as substitutes for any GAAP financial measures.

Operating realized gains (losses) - A non-GAAP financial measure that represents net realized gains (losses) on investments related to operating items (periodic net coupon settlements on non-qualifying derivatives, trading portfolio realized gains and losses, trading portfolio valuation changes, and net realized gains and losses related to securitizations).

Operating return on average equity - A non-GAAP financial measure that is calculated by annualizing the net operating earnings and dividing by the average equity amount.

Operating revenues - A non-GAAP financial measure that is calculated by adjusting total revenues to exclude net realized gains and losses on investments not related to operating items (periodic net coupon settlements on non-qualifying derivatives, trading portfolio realized gains and losses, trading portfolio valuation changes, and net realized gains and losses related to securitizations), hedging instruments and hedged items.

Persistency - Percentage of life insurance policies or annuity contracts remaining in force from one period to another.

Policy Acquisition Costs - Expenses that vary with and are primarily related to the acquisition of new and renewal insurance contracts.

Pre-tax operating earnings - A non-GAAP financial measure that is calculated by adjusting earnings from continuing operations before federal income taxes and cumulative effect of adoption of accounting principles, if any, to exclude adjustment to amortization related to net realized gains and losses, and net realized gains and losses on investments, hedging instruments and hedged items, except for operating items (periodic net coupon settlements on non-qualifying derivatives, trading portfolio realized gains and losses, trading portfolio valuation changes, and net realized gains and losses related to securitizations).

Pre-tax operating earnings to average account values - A non-GAAP financial measure that is calculated by dividing pre-tax operating earnings by average account values.

Pre-tax operating earnings to operating revenues - A non-GAAP financial measure that is calculated by dividing pre-tax operating earnings by operating revenues.

Qualified Plan - A plan purchased with pre-tax dollars, generally under a pension plan, specially sponsored program, or individual retirement account that the Internal Revenue Service approves as meeting the requirements of Section 401(a) of the 1986 Internal Revenue Code, as amended. Such plans receive tax advantages.

Ratio of pre-tax operating earnings before interest to interest expense - A non-GAAP financial measure that is calculated by subtracting interest expense from pre-tax operating earnings and dividing the product by interest expense.

Return on average allocated capital - A non-GAAP financial measure that is calculated by dividing annualized after-tax operating earnings by average allocated capital.

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March 31, 2007Glossary

Sales - Represents a production volume metric that is primarily comprised of statutory premiums and deposits on individual and group annuities and life insurance products sold to a diverse customer base. Statutory premiums and deposits are calculated in accordance with accounting practices prescribed or permitted by regulatory authorities and then adjusted to arrive at sales. Sales also include deposits on administration-only group pension plans.

Sales are stated net of internal replacements, which in Nationwide Financial’s opinion provides a more meaningful disclosure of sales. In addition, sales exclude: funding agreements issued under Nationwide Financial’s medium-term note program; large case bank-owned life insurance (BOLI); large case pension plan acquisitions; and deposits into Nationwide employee and agent benefitplans. Although these products contribute to asset and earnings growth, they do not produce steady production flow that lends itself to meaningful comparisons and are therefore excluded from sales.

Separate Account - A separate investment account established and maintained by an insurance enterprise used primarily for variable products. This arrangement permits wider latitude in the choice of investments for contract holders.

Surrender Charges - Charges made against withdrawals from the contract value of most variable annuities for a period of time, typically four to seven years.

Statutory capital and surplus - A financial measure that is calculated based on accounting practices prescribed or permitted by the department of insurance of the state of domicile. Each of the states in which the Company’s insurance companies are domiciled has adopted the National Association of Insurance Commissioners (NAIC) statutory accounting practices (NAIC SAP) as the basis of its statutory accounting practices. The Company’s insurance subsidiaries have no statutory accounting practices that differ from NAIC SAP.

Universal Life Insurance - A flexible premium, adjustable benefit life insurance contract that accumulates cash values through the receipt of contractually determined interest credited.

Variable Annuity - An annuity contract in which the funds are invested in investments for which the underlying values can fluctuate.

Variable Life Insurance - A securities-based whole life insurance policy that employs a fixed premium and provides variable cash values and death benefit, dependent upon the performance of the separate account investment election.

Variable Universal Life Insurance - A type of variable life insurance that has flexible premiums.

Value of Business Acquired (VOBA) - Reflects the estimated fair value of the Nationwide Provident business in-force and represents the portion of the purchase price that is allocated to the value of the right to receive future cash flows from the life insurance and annuity contracts existing as of the closing date of the Nationwide Financial Network Merger.

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Shareholder Information

Corporate OfficesNationwide FinancialOne Nationwide PlazaColumbus, OH 43215

InquiriesMark BarnettVice President, Investor Relations(614) [email protected]

Roger W. GreenOfficer, Investor Relations(614) [email protected]

Financial Strength RatingsA.M. Best . A+Moody's Aa3Standard & Poors AA-

Stock SymbolNationwide Financial's common stock is traded on the New York Stock Exchange under the symbol "NFS"

Nationwide Financial's trust-preferred securities are traded on the New York Stock Exchange under the symbol "NFS A"

Upcoming Events

2nd Quarter 2007 EarningsQuiet Period - July 12th to August 1stEarnings Release - August 1stConference Call - August 2nd

UBS Global Financial Services ConferenceNew York, New YorkMay 15thMark Thresher

This report is for information purposes only. It should be read in conjunction with documents filed by Nationwide Financial Services, Inc. with the U.S. Securities and Exchange Commission, including the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

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Notes

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nationwide 1Q07 Statistical Supplement

Economy & Finance

Transcript of nationwide 1Q07 Statistical Supplement