NEGOTIABLE INSTRUMENTS • Negotiable Instruments - A Written Contract For
Interim Report Six-Month Period Ended September 30, 2015 2015 · Negotiable certificates of deposit...
Transcript of Interim Report Six-Month Period Ended September 30, 2015 2015 · Negotiable certificates of deposit...
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2015Interim Report
Six-Month Period Ended September 30, 2015
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Financial and C
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Financial and Corporate D
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Financial and Corporate Data
Corporate Data Corporate History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Business Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Organization Chart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Directors, Audit & Supervisory Board Members and Executive Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Staff Profile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Office Directory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Business Network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Financial DataConsolidated InformationCONSOLIDATED BUSINESS RESULTS . . . . . . . . . . . . . . . . . . 8 Consolidated Financial Highlights . . . . . . . . . . . . . . . . . . . . . 8CONSOLIDATED FINANCIAL REVIEW . . . . . . . . . . . . . . . . . . . 9 Consolidated and Equity-Method Companies . . . . . . . . . . . . 9 Analysis of Business Results . . . . . . . . . . . . . . . . . . . . . . . . . 9 Analysis of Financial Condition . . . . . . . . . . . . . . . . . . . . . . . 11 Disclosure of Exposure to Securitized Products . . . . . . . . . . 13CONSOLIDATED SEMIANNUAL FINANCIAL STATEMENTS . . . 14 Consolidated Semiannual Balance Sheet (Unaudited) . . . . . . 14 Consolidated Semiannual Statement of Income (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Consolidated Semiannual Statement of Comprehensive Income (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Consolidated Semiannual Statement of Changes in Equity (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Consolidated Semiannual Statement of Cash Flows (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Notes to Consolidated Semiannual Financial Statements (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18INCOME ANALYSIS (Consolidated) . . . . . . . . . . . . . . . . . . . . . . 45 Interest-Earning Assets and Interest-Bearing Liabilities . . . . . 45 Fees and Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Trading Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Other Ordinary Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Non-Consolidated InformationNON-CONSOLIDATED BUSINESS RESULTS . . . . . . . . . . . . . . 46 Non-Consolidated Financial Highlights . . . . . . . . . . . . . . . . . 46NON-CONSOLIDATED SEMIANNUAL FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Non-Consolidated Semiannual Balance Sheet (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Non-Consolidated Semiannual Statement of Income (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Non-Consolidated Semiannual Statement of Changes in Equity (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49INCOME ANALYSIS (Non-Consolidated) . . . . . . . . . . . . . . . . . . 50 Net Revenue, Business Profit . . . . . . . . . . . . . . . . . . . . . . . . 50 Ratios . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 Yield on Interest-Earning Assets, Interest Rate on Interest-Bearing Liabilities, Net Yield/Interest Rate . . . . . . . . 50 Average Balance of Interest-Earning Assets and Interest-Bearing Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 51 Analysis of Interest Income and Interest Expenses . . . . . . . . 52 Fees and Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 Trading Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 Other Ordinary Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 General and Administrative Expenses . . . . . . . . . . . . . . . . . . 54
DEPOSIT OPERATIONS (Non-Consolidated) . . . . . . . . . . . . . . 55 Balance by Deposit Account . . . . . . . . . . . . . . . . . . . . . . . . . 55 Balance of Time Deposits by Residual Period . . . . . . . . . . . . 55 Outstanding Balance by Depositor . . . . . . . . . . . . . . . . . . . . 56 Deposits per Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Deposits per Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56DEBENTURE OPERATIONS (Non-Consolidated) . . . . . . . . . . . 57 Outstanding and Average Balance of Debentures . . . . . . . . . 57 Balance by Residual Period . . . . . . . . . . . . . . . . . . . . . . . . . 57 Outstanding Balance of Debentures per Office . . . . . . . . . . . 57 Outstanding Balance of Debentures per Employee . . . . . . . . 57LOAN OPERATIONS (Non-Consolidated) . . . . . . . . . . . . . . . . . 58 Outstanding Balance of Loans . . . . . . . . . . . . . . . . . . . . . . . 58 Balance by Residual Period . . . . . . . . . . . . . . . . . . . . . . . . . 58 Ratio of Loans and Bills Discounted to Debentures/Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Loans per Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Loans per Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Loans to Small and Medium-Sized Corporations . . . . . . . . . 59 Consumer Loans Outstanding . . . . . . . . . . . . . . . . . . . . . . . 59 Breakdown of Loans and Bills Discounted by Industry . . . . . 59 Risk-Monitored Loans by Industry . . . . . . . . . . . . . . . . . . . . . 60 Balance of Loans and Bills Discounted, Classified by Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Breakdown of Balance of Acceptances and Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Breakdown of Loans and Bills Discounted by Collateral . . . . 60 Breakdown of Collateral for Customers’ Liabilities for Acceptances and Guarantees . . . . . . . . . . . . . . . . . . . . 61 Write-Off of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Allowance for Loan Losses . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Country Risk Reserve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Disclosed Claims under the Financial Reconstruction Law . . . . 62 Risk-Monitored Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 Reserve Provision Ratios for Each Category of Borrower, Based on Asset-Assessments . . . . . . . . . . . . . . . . . . . . . . 62 Asset-Assessment, Disclosed Claims, Write-Offs, Reserves and Risk-Monitored Loans . . . . . . . . . . . . . . . . . . 63SECURITIES (Non-Consolidated) . . . . . . . . . . . . . . . . . . . . . . . 64 Outstanding and Average Balance of Securities Held . . . . . . 64 Balance of Securities by Residual Period . . . . . . . . . . . . . . . 65 Ratio of Securities to Debentures and Deposits . . . . . . . . . . 65SECURITIES BUSINESS (Non-Consolidated) . . . . . . . . . . . . . . 66 Underwriting of Public Bonds . . . . . . . . . . . . . . . . . . . . . . . . 66 Over-the-Counter Sales of Public Bonds and Securities Investment Trusts . . . . . . . . . . . . . . . . . . . . . . . . 66INTERNATIONAL OPERATIONS (Non-Consolidated) . . . . . . . . 66 Foreign Exchange Transactions . . . . . . . . . . . . . . . . . . . . . . 66 Balance of Assets in International Operations . . . . . . . . . . . . 66OTHER OPERATIONS (Non-Consolidated) . . . . . . . . . . . . . . . . 67 Principal Fees and Commissions . . . . . . . . . . . . . . . . . . . . . 67 Domestic Exchange Transactions . . . . . . . . . . . . . . . . . . . . . 67 Automated Installations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67CAPITALIZATION (Non-Consolidated) . . . . . . . . . . . . . . . . . . . . 68 History of Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 Major Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 Ownership and Distribution of Shares . . . . . . . . . . . . . . . . . . 69
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline . . . . . . . 70
Share Procedure Information . . . . . . . . . . . . . . . . . . . . 93
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Corporate Data
Corporate History
April 1957 Established as The Nippon Fudosan Bank, Limited (capital: ¥1 billion) in accordance with the Long-Term Credit Bank Law
November Started issuance of debentures
September 1958 Started issuance of discount debentures
July 1964 Started foreign exchange business as an authorized foreign exchange bankSeptember Listed stock on the Tokyo Stock Exchange
February 1970 Listed stock on the Osaka Securities Exchange
October 1977 Changed name to The Nippon Credit Bank, Ltd.
February 1994 Established The Nippon Credit Trust Bank, Ltd. (currently Aozora Trust Bank, Ltd.), the first domestic subsidiary classified as other type of business
December 1998 Started special public management in accordance with the Financial Reconstruction Law and terminated listing of stock on the Tokyo Stock Exchange and the Osaka Securities Exchange
September 1999 NCB Servicer Co., Ltd. (currently Aozora Loan Services Co., Ltd.), commenced servicer operations
September 2000 Share Purchase Agreement regarding the transfer of the Bank’s shares was signed between Deposit Insurance Corporation and SOFTBANK CORP., ORIX Corporation, The Tokio Marine and Fire Insurance Co., Ltd. (currently Tokio Marine & Nichido Fire Insurance Co., Ltd.), and other financial institutions Ended special public management
November Commenced telephone banking services
January 2001 Changed name to Aozora Bank, Ltd.April Launched Aozora Direct Time Deposit as a product exclusively available through telephone
banking
October 2002 Commenced over-the-counter sales of personal pension life insurance policies
March 2003 Moved headquartersSeptember Through a common stock tender offer conducted in accordance with the Securities Exchange
Law, all common stock of the Bank held by SOFTBANK CORP. was transferred to the ownership of Cerberus NCB Acquisition, L.P., General Partner Cerberus Aozora GP L.L.C.
June 2005 Launched Excellent First time deposit (callable time deposit)Established a subsidiary, Aozora Asia Pacific Finance Limited, in Hong Kong
July Established New York Representative Office
April 2006 Converted from ‘Long-Term Credit Bank’ to an ‘Ordinary Bank’ Established a securities subsidiary, Aozora Securities Co., Ltd.
November Listed on the First Section of the Tokyo Stock Exchange
May 2007 Established Shanghai Representative Office
April 2008 Tender offer for common shares by Cerberus NCB Acquisition, L.P., General Partner Cerberus Aozora GP L.L.C.
April 2009 Established Internet BranchCommenced Internet banking services
December 2011 Completion of acquisition of Japan Wealth Management Securities, Inc., making it a wholly owned subsidiary of the Bank (Merged with Aozora Securities Co., Ltd. in February 2012. New company name: Aozora Securities, Co., Ltd.)
August 2012 Announced the Comprehensive Recapitalization PlanDecember Established Financial Oasis Jiyugaoka (Shibuya Branch Jiyugaoka Office)
January 2013 Secondary offering of Aozora common stock by parent company, Cerberus NCB Acquisition, L.P., General Partner Cerberus Aozora GP L.L.C.
March Launched Aozora Cash Card Plus (Visa debit)Established Aozora Regional Consulting Co., Ltd.
August Cerberus NCB Acquisition, L.P., General Partner Cerberus Aozora GP L.L.C. sold its entire remaining stake in Aozora
February 2014 Established an investment trust subsidiary, Aozora Investment Management Co., Ltd.May Established Singapore Representative Office
January 2015 Established an investment advisory subsidiary, Aozora Real Estate Investment Advisors Co., Ltd.June Early and full repayment of public fundsDecember Established a subsidiary, Aozora Europe Limited, in London
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Corporate Data
● Deposits
Deposits
Checking accounts, savings accounts, time deposits, deposits-at-notice, tax-savings deposits, non-residents’ deposits in yen
and deposits in foreign currencies
Negotiable certificates of deposit
● Debentures
Issuance of debentures and straight bonds
● Lending
Loans
Loans on deeds, loans on notes and overdraft
Discount on promissory notes
Bankers’ acceptances and discounts on commercial bills and documentary drafts
● Securities investment business Public bonds, local bonds, corporate bonds, equity and other securities for cash reserves for payment of the deposit and fund
management
● Domestic exchange
Such services as money orders between branches of the Bank and those of other banks, collection of payments, etc.
● Foreign exchange
Remittance to foreign countries and other foreign currency-related businesses
● Consignment of bonds and registration Consignment business for soliciting or managing public bonds, registration of public bonds as a registered institution and issue
agent or payment agent
● Other services 1. Guarantee of liabilities (acceptances and guarantees)
2. Lending of securities
3. Underwriting of public bonds
4. Over-the-counter sales of public bonds, including national government bonds, and securities investment trusts
5. Trust business for secured corporate bonds
6. Agency business
➀ Revenue agency for Bank of Japan
➁ Handling of funds for regional public entities, including those in Tokyo
➂ Japan Finance Corporation; Organization for Workers’ Retirement Allowance Mutual Aid;
Government Pension Investment Fund; Japan Oil, Gas and Metals National Corporation; and
Welfare and Medical Service Agency
7. Custody services
8. Interest rate, currency and other derivatives transactions
9. Over-the-counter sales of insurance products
10. Financial instruments intermediary business
Business Activities (As of January 1, 2016)
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Organization Chart (As of January 1, 2016)
International Div.
Overseas Representative Offices(New York,Shanghai,Singapore)
Aozora Asia Pacific Finance Limited
Aozora Europe Limited
Institutional Banking Group
Institutional Banking Management Div.
(Facilitation of Financing Promotion Office)
Asian BusinessPromotion Div.
Corporate Banking
Services Div.
Retail Business Strategy Div.
Retail Operation & Technology Div.
Retail SalesPromotion Div.
Direct Banking Div.
Retail Banking Div.
Internet Br.
Aozora SecuritiesCo., Ltd.
Aozora Investment Management Co., Ltd.
Metropolitan Business Div. I
Metropolitan Business Div. II
Metropolitan Business Div. III
Syndication & Securitization Div.
Financial Institutions Div. I
Financial Institutions Div. II
Aozora Trust Bank, Ltd.
Aozora Regional Consulting Co., Ltd.
[Aozora SecuritiesCo., Ltd.]
[Aozora Investment Management Co., Ltd.]
M&A Advisory Div.
Corporate Business Div. II
Corporate Business Div. III
Corporate Business Div. IV
Corporate Business Div. VI
Public Institutions Div.
Acquisition & Project Finance Div.
TreasuryFunding Div.
Treasury Investment Div.
Credit Investment Div.
Market Products Div.
Derivatives Sales Div.
Market Products Development Div.
Special Situations Div.
Real Estate Finance Div.
GlobalReal Estate Structured Debt Div.
Corporate BusinessDiv. I
Corporate BusinessDiv. V
Aozora Loan ServicesCo., Ltd.
Aozora Real Estate Investment Advisors Co., Ltd.
Financial Control Div.
Financial Management Div.
Corporate Communication Div.
IT Control Div.
ApplicationManagement Div.
InfrastructureManagementDiv.
Business Technology Strategy Div.
Operations Management Div.
Integrated Risk Management Div.
Credit RiskManagementDiv.
Market RiskManagement Div.
Compliance & Operations Management Div.
Compliance & Governance Unit
Human Resources Div.
Human Resources Unit
Head of Compliance & Governance Unit
Head of Human Resources Unit
Management Committee
Board of Directors
ShareholdersAudit & Supervisory
Board Members
Audit & Supervisory Board
Office of Audit & Supervisory Board
[Branches]
Kansai Br., Nagoya Br., Fukuoka Br., Sendai Br., Hiroshima Br., Sapporo Br., Takamatsu Br., Kanazawa Br.
Shinjuku Br., Nihonbashi Br., Shibuya Br., Ueno Br., Ikebukuro Br., Yokohama Br., Chiba Br., Osaka Br., Umeda Br., Kyoto Br., Financial Oasis Jiyugaoka
AlliedBanking
Group
Group Head
BusinessBanking
Group
Group Head
CorporateBanking
Group
Group Head
Retail Banking
Group
Group Head
Integrated Risk
ManagementGroup
Chief Risk
Officer(CRO)
FinanceGroup
Chief Financial
Officer(CFO)
Technology &Operations
Group
Chief Technology
Officer(CTO)
Credit Div. I
Credit Div. II
Credit Div. III(Facilitation of Financing Review Office)
Workout Div.
Appraisal Div.
Credit RiskManagement
Group
Chief Credit Risk
Officer(CCRO)
Specialized Banking Group
SpecialtyFinance Group
Group Head
International Finance Group
Group Head
FinancialMarkets
Group
Group Head
Corporate Administration & Service Div.
Business Strategy Div.
Crisis Management Div.
Head of Corporate Strategy Unit
Corporate Strategy Unit
Internal Audit Div.
Asset Assessment Div.Chief Executive Officer (CEO)
Business Innovation
Office
EO in charge
Office of Corporate Secretary
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Directors, Audit & Supervisory Board Members and Executive Officers (As of September 30, 2015)
Directors and Audit & Supervisory Board Members Executive Officers
Director and Chairman Makoto Fukuda*
Representative Director
and President
Shinsuke Baba*
Representative Director
and Deputy President
Masaki Tanabe*
Director and
Senior Managing Executive Officer
Takeo Saito*
Directors Shunsuke Takeda
Hiroyuki Mizuta
Ippei Murakami
Tomonori Ito
Standing Audit & Supervisory Board
Member
Shinichi Fujihira
Audit & Supervisory Board Members Akira Tachimoto
Kiyoto Hagiwara
*Serving as Executive Officer concurrently
Managing Executive Officers Clark D. Graninger
Katsuya Hosono
Masatatsu Ozeki
Kei Tanikawa
Masaaki Harada
Executive Officers Jorge A. Leon
Yukio Sekizawa
Koji Yamakoshi
Keiichi Asada
Fumihiko Hirose
Tomomi Akutagawa
Hideaki Kuraishi
Masayoshi Ohara
Yutaka Aoyama
Masato Mano
Takayoshi Nomura
Staff Profile (As of September 30, 2015)
Number of Employees Average Age Average Years of Service
1,690 (251) 42.0 14.2
Notes: 1. The number of employees includes executive officers and locally hired staff overseas, but excludes temporary employees. 2. The figure in parentheses is the average number of temporary employees for the year.
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Office Directory (As of January 1, 2016)
Singapore Representative Office
Chief RepresentativeNorikazu Terashima
Address50 Raffles Place, #16-05A Singapore Land Tower, Singapore 048623Tel: +65-6221-9221 Fax: +65-6221-9421
Overseas Network
● Representative Offices
New York Representative Office
Chief RepresentativeMasato Nagatani
Address1270 Avenue of the Americas, Suite #1040, New York, NY 10020, U.S.A. Tel: +1-212-830-1680Fax: +1-212-314-3124
Domestic Network
● Head Office3-1, Kudan-minami 1-chome,Chiyoda-ku, Tokyo 102-8660, JapanTel: +81-3-3263-1111SWIFT: NCBTJPJT
● Branch OfficesSapporo
1-4, Kita Sanjo-nishi 4-chome,Chuo-ku, Sapporo 060-0003Tel: 011-241-8171
Sendai
2-1, Chuo 3-chome, Aoba-ku, Sendai 980-0021Tel: 022-225-1171
Shinjuku
37-11, Shinjuku 3-chome,Shinjuku-ku, Tokyo 160-0022Tel: 03-3354-1600
Nihonbashi
3-11, Nihonbashi 3-chome, Chuo-ku, Tokyo 103-0027 Tel: 03-3517-7888
Shibuya
7-7, Shibuya 1-chome, Shibuya-ku, Tokyo 150-0002Tel: 03-3409-6411
Ueno
12-20, Ueno 2-chome, Taito-ku, Tokyo 110-0005Tel: 03-3835-7511
Shanghai Representative Office
Chief RepresentativeKiyohide Sunaga
Address27F, Hang Seng Bank Tower, 1000 Lujiazui Ring Road, Pudong New Area,Shanghai 200120, ChinaTel: +86-21-3899-6288 Fax: +86-21-6841-2882
Ikebukuro
28-13, Minami-Ikebukuro 2-chome, Toshima-ku, Tokyo 171-0022Tel: 03-3988-0911
Chiba
14-1, Fujimi 2-chome, Chuo-ku, Chiba 260-0015Tel: 043-227-3111
Yokohama
4-1, Kita-saiwai 1-chome, Nishi-ku, Yokohama 220-0004Tel: 045-319-1588
Kanazawa
2-37, Kamitsutsumicho,Kanazawa 920-0869Tel: 076-231-4151
Nagoya
28-12, Meieki 3-chome, Nakamura-ku, Nagoya 450-6404Tel: 052-566-1900
Kyoto
79, Kankobokocho, Muromachi-Higashiiru, Shijo-dori,Shimogyo-ku, Kyoto 600-8009Tel: 075-211-3341
Kansai
12-12, Umeda 1-chome, Kita-ku, Osaka 530-0001Tel: 06-4799-3541(Kansai Branch deals solely with corporate clients.)
Osaka
2-3, Namba 2-chome, Chuo-ku, Osaka 542-0076Tel: 06-4708-2051
Umeda
12-12, Umeda 1-chome, Kita-ku, Osaka 530-0001Tel: 06-4799-3533
Hiroshima
13-13, Motomachi, Naka-ku, Hiroshima 730-0011Tel: 082-211-0125
Takamatsu
6-1, Bancho 1-chome,Takamatsu 760-0017Tel: 087-821-5521
Fukuoka
8-36, Tenjin 2-chome, Chuo-ku, Fukuoka 810-0001Tel: 092-751-4261
Internet Branch
3-1, Kudan-minami 1-chome,Chiyoda-ku, Tokyo 102-8660http://www.aozorabank.co.jp/netbranch/
Financial Oasis Jiyugaoka(Shibuya Branch Jiyugaoka Office)
28-1, Okusawa 5-chome, Setagaya-ku, Tokyo 158-0083 Tel: 03-5483-3223
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Corporate Data
Business Network (As of September 30, 2015)
Subsidiaries (As of September 30, 2015)(%)
Company Name Location Business Activities Established CapitalAozora Bank Shareholding
Group Shareholding
Aozora Trust Bank, Ltd. 3-1, Kudan-minami 1-chome, Chiyoda-ku, Tokyo
Trust services, banking operations
February 28, 1994
5,437 millions of JPY
100.0 —
Aozora Loan Services Co., Ltd.
13-5, Kudan-kita 1-chome, Chiyoda-ku, Tokyo
Distressed loan servicing
June 18, 1996
500 millions of JPY
67.6 —
Aozora Securities Co., Ltd. 3-1, Kudan-minami 1-chome, Chiyoda-ku, Tokyo
Securities services January 23, 2006
3,000 millions of JPY
100.0 —
Aozora Regional Consulting Co., Ltd.
3-1, Kudan-minami 1-chome, Chiyoda-ku, Tokyo
Management consulting services
March 21, 2013
10 millions of JPY
100.0 —
Aozora Investment Management Co., Ltd.
3-1, Kudan-minami 1-chome, Chiyoda-ku, Tokyo
Investment management services
February 4, 2014
225 millions of JPY
100.0 —
Aozora Real Estate Investment Advisors Co., Ltd.
3-1, Kudan-minami 1-chome, Chiyoda-ku, Tokyo
Investment advisory services
January 6, 2015
150 millions of JPY
100.0 —
Aozora Asia Pacific Finance Limited
Hong Kong Financial services June 29, 2005
100,000 thousands of USD
100.0 —
Aozora GMAC Investment Limited
London Investments November 6, 2006
30,070 thousands of USD
100.0 —
Aozora Investment, Inc. Delaware, USA Investments November 21, 2006
411 thousands of USD
— 100.0
Aozora Investments LLC Delaware, USA Investments November 22, 2006
500,282 thousands of USD
— 100.0
AZB Funding Cayman Islands, British West Indies
Investment vehicle June 1, 2012
0 thousands of USD
— —
AZB Funding 2 Cayman Islands, British West Indies
Investment vehicle March 19, 2013
0 thousands of USD
— —
AZB Funding 3 Cayman Islands, British West Indies
Investment vehicle September 18, 2013
0 thousands of USD
— —
AZB Funding 4 Limited Dublin, Ireland Investment vehicle March 18, 2014
0 thousands of EUR
— —
AZB Funding 5 Cayman Islands, British West Indies
Investment vehicle August 18, 2014
0 thousands of USD
— —
AZB Funding 6 Cayman Islands, British West Indies
Investment vehicle July 7, 2015
0 thousands of USD
— —
*All companies listed below are consolidated subsidiaries.
Aozora Bank, Ltd.
Banking operations
Other operations
Head Office and branches
Main affiliates
Main affiliates
Management consulting servicesFinancial servicesInvestmentsInvestmentsInvestmentsInvestment vehicleInvestment vehicleInvestment vehicleInvestment vehicleInvestment vehicleInvestment vehicle
Trust services, Banking operationsDistressed loan servicingSecurities servicesInvestment management servicesInvestment advisory services
Aozora Regional Consulting Co., Ltd.Aozora Asia Pacific Finance Limited Aozora GMAC Investment LimitedAozora Investment, Inc.Aozora Investments LLC AZB FundingAZB Funding 2AZB Funding 3AZB Funding 4 LimitedAZB Funding 5AZB Funding 6
Aozora Trust Bank, Ltd.Aozora Loan Services Co., Ltd.Aozora Securities Co., Ltd.Aozora Investment Management Co., Ltd.Aozora Real Estate Investment Advisors Co., Ltd.
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Consolidated B
usiness Results
Consolidated Business Results
Consolidated Financial Highlights For the six-month periods ended September 30, 2015, 2014 and 2013, and the years ended March 31, 2015 and 2014
(Millions of Yen)
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2013 Mar. 31, 2015 Mar. 31, 2014
Ordinary income . . . . . . . . . . . . . . . . . . . . . . . . 60,242 68,237 73,921 130,035 131,834
Ordinary profit . . . . . . . . . . . . . . . . . . . . . . . . . 29,675 38,024 27,392 59,671 52,186
Net income attributable to owners of parent (Note 1) . . . . . . . . . . . . . . . . . . . . . . . . 24,297 23,654 23,959 43,689 42,328
Comprehensive income . . . . . . . . . . . . . . . . . . 7,413 33,673 9,108 90,295 27,377
Capital stock . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000 100,000 100,000 100,000 100,000
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . 400,251 519,692 502,471 567,414 516,038
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,638,332 5,043,453 4,793,908 4,924,472 4,805,439
Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 228,886 165,263 246,112 197,550
Deposits (Note 2) . . . . . . . . . . . . . . . . . . . . . . . . . 3,036,721 3,078,298 3,071,019 2,984,747 3,009,734
Loans and bills discounted . . . . . . . . . . . . . . . . 2,610,391 2,719,842 2,695,058 2,775,817 2,643,511
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 949,581 1,220,203 1,113,288 984,060 1,168,615
Total equity per share (yen) (Note 3) . . . . . . . . . . . . 342.33 313.46 298.74 336.83 292.83
Basic net income per share (yen) (Note 3) . . . . . . . 20.83 19.65 19.83 36.19 34.87
Diluted net income per share (yen) (Note 3) . . . . . . 17.80 15.03 15.23 27.77 26.91
Consolidated capital adequacy ratio (domestic standard) (%) (Note 4) . . . . . . . . . . . . . — — 16.09 — —
Consolidated capital adequacy ratio (domestic standard) (%) (Note 5) . . . . . . . . . . . . . 11.02 14.95 — 14.45 15.13
Net cash provided by (used in) operating activities . . . . . . . . . . . . . . . . . . . . . 162,107 91,248 (87,432) (139,546) (87,801)
Net cash provided by (used in) investing activities . . . . . . . . . . . . . . . . . . . . . 18,998 (36,644) 206,584 291,989 179,321
Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . (174,753) (30,100) (42,579) (39,083) (51,715)
Cash and cash equivalents, end of period . . . . 507,251 412,042 424,308 500,900 387,540
Notes: 1. The Bank has adopted the ‘Accounting Standard for Business Combinations’ (ASBJ Statement No. 21, September 13, 2013) and other related standards from the beginning of the fiscal year starting on April 1, 2015. Due to the application, the presentation of ‘net income’ is changed to ‘net income attributable to owners of parent’.
2. Deposits include negotiable certificates of deposit (NCDs). 3. Total equity per share, basic net income per share and diluted net income per share are calculated by applying Financial Accounting Standard
No. 2, ‘Accounting Standard for Earnings Per Share’ and Financial Accounting Standards Implementation Guidance No. 4, ‘Implementation Guidance for Accounting Standard for Earnings Per Share.’
4. Consolidated capital adequacy ratio (domestic standard) is calculated based on Basel II. 5. Consolidated capital adequacy ratio (domestic standard) is calculated based on Basel III.
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orporate Data
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eview
Consolidated Financial Review
1. Consolidated and Equity-Method Companies
The consolidated financial statements include the accounts of the Bank and its significant subsidiaries. The number of con-solidated subsidiaries was 16 as of September 30, 2015 and 15 as of March 31, 2015.
AZB Funding 6 was established and is now included in the scope of consolidation as a subsidiary. No subsidiaries and affiliated companies were accounted for using the equity method.
2. Analysis of Business Results
Aozora reported profit attributable to owners of parent of ¥24.3 billion, an increase of 2.7% year on year.
(1) Income
Total income was ¥60.2 billion, a decrease of ¥8.0 billion year on year. Interest income was ¥32.5 billion, an increase of ¥1.6 billion year on year, mainly due to increased interest on loans and discounts. Income from fees and commissions was ¥6.2 billion, a decrease of ¥1.8 billion year on year, due to a decline in loan-related fee income.
Trading income was ¥5.4 billion, a decrease of ¥0.0 billion year on year, including the continued favorable sale of derivative-related products to our corporate and financial institution customers. Other ordinary income was ¥12.8 billion, an increase of ¥1.2 billion year on year. Contributing to this result were gains from limited partnerships. Other income was ¥3.2 billion, a decrease of ¥8.9 billion year on year, mainly due to decreased reversal of allowance for loan losses.
Consolidated and Equity-Method Companies(Number of Companies)
Sep. 30, 2015 Mar. 31, 2015 Change
Consolidated subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 15 1
Subsidiaries and affiliated companies accounted for using the equity method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0
(Millions of Yen)
Sep. 30, 2015(6 months)
Sep. 30, 2014(6 months) Change
Total income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥60,242 ¥68,237 ¥(7,995)
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,541 30,984 1,557 Interest on loans and discounts . . . . . . . . . . . . . . . . . . . . . . . . . . 21,799 20,936 863 Interest and dividends on securities . . . . . . . . . . . . . . . . . . . . . . . 9,557 9,202 355 Interest on due from banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 27 19 Other interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,138 818 320
Fees and commissions income . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,246 8,035 (1,789)
Trading income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,440 5,468 (28)
Other ordinary income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,847 11,671 1,176 Gains on sales of bonds and other securities . . . . . . . . . . . . . . . 4,846 4,897 (51)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,001 6,774 1,227
Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,166 12,077 (8,911)Gains on sales of stocks and other securities . . . . . . . . . . . . . . . 81 205 (124)Gains on investments in money held in trust . . . . . . . . . . . . . . . . 214 54 160 Recoveries of written-off claims . . . . . . . . . . . . . . . . . . . . . . . . . . 2,216 3,105 (889)Reversal of allowance for loan losses . . . . . . . . . . . . . . . . . . . . . — 4,375 (4,375)Reversal of provision for credit losses on off-balance-sheet instruments . . . . . . . . . . . . . . . . . . . . . . . — 579 (579)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥654 ¥3,756 ¥(3,102)
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(2) Expenses
Total expenses decreased ¥5.4 billion year on year to ¥30.6 billion. Interest expenses increased ¥0.4 billion to ¥7.1 billion year on year, as a result of increased interest on swaps. Trading expenses was ¥0.3 billion, an increase of ¥0.3 billion year on year, mainly due to increased expenses on securities and derivatives related to trading transactions. Other ordinary expenses decreased ¥0.1 billion to ¥2.6 billion, reflecting decreased losses on sales of bonds and other securities.
General and administrative expenses increased ¥0.8 billion year on year to ¥19.1 billion, mainly due to increased staff in our focus business areas. Other expenses decreased ¥6.8 billion to ¥0.9 billion. During the first half of FY2014, the bank recognized an other expenses of ¥5.7 billion as a result of crystallizing a negative foreign currency translation adjustment.
(3) Net Income attributable to owners of parent
Income before income taxes decreased ¥2.6 billion to ¥29.7 billion year on year. Income taxes was ¥5.4 billion. As a result of the above factors, Net income attributable to owners of parent for the first half was ¥24.3 billion, compared with ¥23.7 billion in the first half of FY2014. Net income per share was ¥20.83.
(Millions of Yen)
Sep. 30, 2015 (6 months)
Sep. 30, 2014 (6 months) Change
Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥30,570 ¥35,957 ¥(5,387)
Interest expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,144 6,710 434 Interest on deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,236 4,854 (618)Interest on debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308 271 37 Interest on borrowings and rediscounts . . . . . . . . . . . . . . . . . . . . 668 541 127 Other interest expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,930 1,042 888
Fees and commissions expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 480 493 (13)
Trading expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318 — 318
Other ordinary expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,636 2,775 (139)Amortization of debenture issuance costs . . . . . . . . . . . . . . . . . . 31 14 17 Losses on foreign exchange transactions . . . . . . . . . . . . . . . . . . 1,491 137 1,354 Losses on sales of bonds and other securities . . . . . . . . . . . . . . 359 1,661 (1,302)Losses on devaluation of bonds and other securities . . . . . . . . . . 0 0 0 Losses on derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 23 30 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700 938 (238)
General and administrative expenses . . . . . . . . . . . . . . . . . . . . . . . 19,063 18,215 848
Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 926 7,761 (6,835)Provision of allowance for loan losses . . . . . . . . . . . . . . . . . . . . . 43 — 43 Provision of allowance for credit losses on off-balance-sheet instruments 247 — 247 Write-off of loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 167 (127)Losses on disposal of noncurrent assets . . . . . . . . . . . . . . . . . . . 2 2 0 Losses on reversal of foreign currency translation adjustment . . . — 5,741 (5,741)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 592 ¥ 1,850 ¥(1,258)
(Millions of Yen)
Sep. 30, 2015 (6 months)
Sep. 30, 2014 (6 months) Change
Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥29,672 ¥32,280 ¥(2,608)
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,365 8,576 (3,211)
Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367 1,439 (1,072)Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,997 7,136 (2,139)
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,307 23,703 604
Net income attributable to non-controlling interests . . . . . . . . . . . . 10 49 (39)
Net income attributable to owners of parent . . . . . . . . . . . . . . . . . . ¥24,297 ¥23,654 ¥ 643
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Consolidated Financial Review
3. Analysis of Financial Condition
(1) Loans and bills discounted
Loans were ¥2,610.4 billion, a decrease of ¥165.4 billion, or
6.0%, from March 31, 2015.
Domestic loans decreased ¥216.2 billion as a result of the
Bank’s ongoing focus on balancing risk and return, as well as
a reduction in low yielding loans. Overseas loans increased by
¥50.8 billion as a result of the Bank’s selective origination of
real estate non-recourse loans and corporate loans, mainly in
North America where risk-return profiles remain attractive.
Risk-monitored loans on a consolidated basis decreased
¥13.2 billion, to ¥25.8 billion from March 31, 2015 and the
ratio to the loan balance decreased 0.4% to 1.0%.
Risk-Monitored Loans (Consolidated) (Millions of Yen)
Sep. 30, 2015 Mar. 31, 2015 Change
Loan balance (end of period) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥2,610,391 ¥2,775,817 ¥(165,426)
Risk-monitored loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,756 38,917 (13,161)
Loans to bankrupt companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Past due loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,999 26,374 (5,375)Loans overdue for three months or more . . . . . . . . . . . . . . . . . . . . . — — — Restructured loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 4,757 ¥ 12,543 ¥ (7,786)
Ratio to loan balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.0% 1.4% (0.4%)
Breakdown of Loans and Bills Discounted by Industry (Consolidated) (Millions of Yen)
Sep. 30, 2015 Mar. 31, 2015
Domestic offices (excluding Japan offshore market accounts) . . . . . . . . . . . . . . . . . . . . . . . . ¥2,210,497 ¥2,392,596
Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 212,512 264,304Agriculture, forestry and fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,689 3,139Mining, quarry, gravel extraction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,437 1,627Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,916 22,155Electricity, gas, heat supply and water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,271 14,339Information and communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,024 40,229Transport, postal service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72,589 82,284Wholesale and retail trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115,243 127,820Finance and insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 389,025 431,657Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 571,314 606,453Leasing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98,882 116,714Various services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145,880 160,908Local government . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,394 40,402Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 512,316 480,560
Overseas offices (including Japan offshore market accounts) . . . . . . . . . . . . . . . . . . . . . . . . . 399,893 383,220
Government . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Financial institutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 399,893 383,220
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥2,610,391 ¥2,775,817
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domestic equities and foreign currency denominated ETFs
were increased, while Japanese national government bonds
and foreign bonds were reduced.
Total unrealized gains were ¥24.2 billion, a decline
compared to unrealized gains of ¥51.1 billion as of March 31,
2015, reflecting increased uncertainty in global markets.
(3) Deferred tax assets
The balance of deferred tax assets increased ¥2.6 billion, to
¥25.3 billion from March 31, 2015.
The proportion of deferred tax assets to net assets was
6.3% as of September 30, 2015.
(4) Deposits, debentures and bonds payable
Deposits and negotiable certificates of deposit increased
¥52.0 billion. Funding from retail customers was ¥2,028.2
billion, and the percentage of retail funding to total core
funding (the sum of deposits, negotiable certificates of deposit,
debentures and bonds) was stable at approximately 60%.
(2) Securities
Securities were ¥949.6 billion as of September 30, 2015, a
decrease of ¥34.5 billion, or 3.5%, compared to March 31,
2015. The Bank continues to secure stable interest income
through an ongoing focus on the diversification and perfor-
mance of its investment portfolio. In the first half of FY2015,
(5) Equity
Equity was ¥400.3 billion, representing a decrease of ¥167.2 billion, or 29.5%, in comparison with March 31, 2015. This decrease
mainly reflected the full repayment of public funds.
Outstanding Balance of Securities Held (Consolidated) (Millions of Yen)
Sep. 30, 2015 Mar. 31, 2015 Change
Japanese debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥189,112 ¥251,808 ¥(62,696)
Japanese national government bonds . . . . . . . . . . . . . . . . . . . . . . . 135,406 193,993 (58,587)Japanese local government bonds . . . . . . . . . . . . . . . . . . . . . . . . . 14,983 18,515 (3,532)Japanese corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,722 39,298 (576)
Japanese stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,332 41,766 1,566
Other securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 717,136 690,486 26,650
Foreign securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 555,914 540,177 15,737 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161,221 150,308 10,913
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥949,581 ¥984,060 ¥(34,479)
Deposits, Debentures and Bonds Payable (Consolidated) (Millions of Yen)
Sep. 30, 2015 Mar. 31, 2015 Change
Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥3,036,721 ¥2,984,747 ¥ 51,974
Time deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,613,426 2,542,666 70,760 Liquid deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 409,295 424,397 (15,102)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,999 17,683 (3,684)
Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 246,112 (4,726)
Bonds payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 10,000 ¥ — ¥ 10,000
Note: Total of deposits and time deposits include negotiable certificates of deposit (NCDs).
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013
Financial and C
orporate Data
Consolidated Financial R
eview
Consolidated Financial Review
4. Disclosure of Exposure to Securitized Products
(1) CDO, CMBS and RMBS ExposureExposure of the Group to CDO (Collateralized Debt Obligation), CMBS (Commercial Mortgage-Backed Securities) and RMBS (Residential Mortgage-Backed Securities) is as follows:
(2) Leveraged FinanceThe exposure of the Group to leveraged finance is as follows:The following amount is the aggregated amount of loan balance rendered for M&A finance (including refinance for M&A deals in the past). It excludes loans that are in investment grade or equivalent ratings.
Geographical distribution Total leveraged finance
(100 Million Yen)
Sep. 30, 2015
CDO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0
CMBS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
RMBS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(100 Million Yen)
Sep. 30, 2015
North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 378Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 464Oceania. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 973
(100 Million Yen)
Sep. 30, 2015
Loan balance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 909
Commitment line (Unfunded) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Total leveraged finance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 973
Note: The figures stated in 100 million yen are rounded to the nearest 100 million.
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014
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Consolidated Semiannual Financial Statements
Consolidated Semiannual Balance Sheet (Unaudited)Aozora Bank, Ltd. and Consolidated SubsidiariesSeptember 30, 2015
Millions of Yen
Thousands ofU.S. Dollars
(Note 1)
Assets Sep. 30, 2015 Sep. 30, 2014 Mar. 31, 2015 Sep. 30, 2015
Cash and cash equivalents (Notes 4 and 25) . . . . . . . . . . . . . . . . . . . . ¥ 507,251 ¥ 412,042 ¥ 500,900 $4,228,508 Due from banks (Note 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62,519 63,497 49,638 521,172 Call loans and bills bought (Note 25) . . . . . . . . . . . . . . . . . . . . . . . . . . 20,059 20,000 20,000 167,222 Receivables under securities borrowing transactions (Note 25) . . . . . . 14,861 34,178 58,889 123,888 Monetary claims bought (Note 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,632 25,428 31,170 255,353 Trading assets (Notes 5, 13, 25 and 26) . . . . . . . . . . . . . . . . . . . . . . . 296,632 374,294 347,104 2,472,759 Money held in trust (Notes 7 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . 13,871 11,714 23,635 115,633 Securities (Notes 6, 13 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 949,581 1,220,203 984,060 7,915,815 Loans and bills discounted (Notes 8, 13 and 25) . . . . . . . . . . . . . . . . . 2,610,391 2,719,842 2,775,817 21,760,516 Foreign exchange (Notes 9 and 13) . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,972 26,178 29,259 208,172 Other assets (Notes 13, 16 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . 82,713 93,621 71,633 689,507 Tangible fixed assets (Note 10) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,891 21,823 22,062 182,487 Intangible fixed assets (Note 10) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,778 4,805 7,225 81,513 Net defined benefit asset. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,662 2,924 5,485 47,201 Deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,276 35,600 22,699 210,709 Customers’ liabilities for acceptances and guarantees (Note 11) . . . . . 26,307 38,529 38,968 219,305 Allowance for loan losses (Note 12) . . . . . . . . . . . . . . . . . . . . . . . . . . . (63,450) (60,560) (63,731) (528,932)Allowance for investment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (620) (672) (347) (5,170)Total ¥4,638,332 ¥5,043,453 ¥4,924,472 $38,665,658
Millions of Yen
Thousands ofU.S. Dollars
(Note 1)
Liabilities and Equity Sep. 30, 2015 Sep. 30, 2014 Mar. 31, 2015 Sep. 30, 2015
Liabilities:Deposits (Notes 14 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥3,036,721 ¥3,078,298 ¥2,984,747 $25,314,452 Debentures (Notes 15 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 228,886 246,112 2,012,222 Call money and bills sold (Notes 13 and 25) . . . . . . . . . . . . . . . . . . . . 137,499 135,754 151,189 1,146,213 Payables under securities lending transactions (Notes 13 and 25) . . . . 256,612 381,571 293,020 2,139,147 Trading liabilities (Notes 5, 25 and 26) . . . . . . . . . . . . . . . . . . . . . . . . . 230,028 329,326 311,257 1,917,542 Borrowed money (Notes 13 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . 190,961 178,307 187,236 1,591,878 Bonds payable (Notes 15 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000 — — 83,361 Other liabilities (Notes 16 and 25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98,206 143,399 134,527 818,664 Net defined benefit liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,910 7,876 7,811 65,941 Provision for directors’ retirement benefits . . . . . . . . . . . . . . . . . . . . . . 1 0 1 15 Provision for credit losses on off-balance-sheet instruments . . . . . . . . 1,985 1,794 1,736 16,551 Provision for contingent loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 451 8 442 3,763 Reserves under the special laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 6 6 63 Acceptances and guarantees (Note 11) . . . . . . . . . . . . . . . . . . . . . . . . 26,307 38,529 38,968 219,305
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,238,080 4,523,760 4,357,057 35,329,117 Equity:Shareholders’ equity:
Capital stock (Note 17) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000 100,000 100,000 833,611 Capital surplus (Note 17) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87,313 289,676 289,676 727,854 Retained earnings (Notes 17 and 29) . . . . . . . . . . . . . . . . . . . . . . . 191,081 223,899 235,035 1,592,875 Treasury stock-at cost (Note 17) . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,388) (99,333) (99,333) (28,243)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 375,006 514,242 525,377 3,126,097 Accumulated other comprehensive income (loss):
Valuation difference on available-for-sale securities . . . . . . . . . . . . . 16,301 767 34,931 135,895 Deferred gains or losses on hedges . . . . . . . . . . . . . . . . . . . . . . . . 2,207 333 (145) 18,404 Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . 1,168 (294) 1,209 9,743 Remeasurements of defined benefit plans . . . . . . . . . . . . . . . . . . . . 4,614 3,763 5,191 38,469
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,293 4,569 41,187 202,511 Subscription rights to shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182 81 81 1,521 Non-controlling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 769 798 767 6,412
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 400,251 519,692 567,414 3,336,541 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,638,332 ¥5,043,453 ¥4,924,472 $38,665,658 See the accompanying notes to consolidated semiannual financial statements.
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015
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Consolidated Semiannual Financial Statements
Consolidated Semiannual Statement of Income (Unaudited)Aozora Bank, Ltd. and Consolidated SubsidiariesFor the six-month period ended September 30, 2015
Millions of Yen
Thousands ofU.S. Dollars
(Note 1)
Sep. 30, 2015 (6 months)
Sep. 30, 2014 (6 months)
Mar. 31, 2015 (1 year)
Sep. 30, 2015 (6 months)
Income:Interest income:
Interest on loans and discounts . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥21,799 ¥20,936 ¥ 42,967 $181,724 Interest and dividends on securities . . . . . . . . . . . . . . . . . . . . . . . . 9,557 9,202 17,685 79,669 Interest on due from banks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 27 59 385 Other interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,138 818 2,685 9,491
Fees and commissions income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,246 8,035 15,606 52,074 Trading income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,440 5,468 12,479 45,349 Other ordinary income (Note 19) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,847 11,671 26,571 107,100 Other income (Note 20) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,166 12,077 11,978 26,397
Total income 60,242 68,237 130,035 502,189 Expenses:
Interest expenses:Interest on deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,236 4,854 9,321 35,319 Interest on debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308 271 562 2,573 Interest on borrowings and rediscounts . . . . . . . . . . . . . . . . . . . . . 668 541 1,162 5,576 Other interest expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,930 1,042 2,370 16,091
Fees and commissions expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . 480 493 1,059 4,006 Trading expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318 - - 2,656 Other ordinary expenses (Note 21) . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,636 2,775 10,745 21,975 General and administrative expenses (Note 22) . . . . . . . . . . . . . . . . . 19,063 18,215 38,631 158,916 Other expenses (Note 23) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 926 7,761 12,268 7,723
Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,570 35,957 76,122 254,835 Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,672 32,280 53,912 247,354 Income taxes:
Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367 1,439 3,452 3,062 Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,997 7,136 6,752 41,662
Total income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,365 8,576 10,205 44,724 Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,307 23,703 43,707 202,631 Net income attributable to non-controlling interests . . . . . . . . . . . . . 10 49 17 87 Net income attributable to owners of parent . . . . . . . . . . . . . . . . . . . ¥24,297 ¥23,654 ¥ 43,689 $202,544
Consolidated Semiannual Statement of Comprehensive Income (Unaudited)Aozora Bank, Ltd. and Consolidated SubsidiariesFor the six-month period ended September 30, 2015
Millions of Yen
Thousands ofU.S. Dollars
(Note 1)
Sep. 30, 2015(6 months)
Sep. 30, 2014(6 months)
Mar. 31, 2015(1 year)
Sep. 30, 2015(6 months)
Net income ¥ 24,307 ¥23,703 ¥43,707 $ 202,631 Other comprehensive income (loss):
Valuation difference on available-for-sale securities (18,629) 3,871 38,035 (155,300)Deferred gains or losses on hedges 2,352 37 (440) 19,615 Foreign currency translation adjustment (40) 6,588 8,091 (338)Remeasurements of defined benefit plans, net of tax (576) (526) 901 (4,807)Total other comprehensive income (loss) (16,893) 9,970 46,587 (140,830)
Comprehensive income ¥ 7,413 ¥33,673 ¥90,295 $ 61,801 Comprehensive income attributable to:
Owners of parent ¥ 7,403 ¥33,624 ¥90,277 $ 61,714 Non-controlling interests 10 49 17 87
See the accompanying notes to consolidated semiannual financial statements.
Yen U.S. Dollars (Note 1)
Sep. 30, 2015 (6 months)
Sep. 30, 2014 (6 months)
Mar. 31, 2015 (1 year)
Sep. 30, 2015 (6 months)
Per share information:Basic net income per share of common stock (Note 27) . . . . . . . . . . . ¥20.83 ¥19.65 ¥36.19 $0.17 Diluted net income per share of common stock (Note 27) . . . . . . . . . 17.80 15.03 27.77 0.15 Cash dividends applicable to the period:
Class A Series 4 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . — 4.00 8.00 —Class C Series 5 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . — 2.976 5.952 —Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.00 6.00 14.90 0.07 Super preferred dividend on Class C Series 5 preferred stock . . . . — *1 *1 —
*1 Super preferred dividend per share is calculated by dividing total dividends of ¥20,490 million from capital surplus by 214,579 thousand shares of Class C Series 5 preferred stock attributable to the fiscal year ended March 31, 2015 and the six-month period ended September 30, 2014, respectively.
See the accompanying notes to consolidated semiannual financial statements.
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016
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Consolidated Semiannual Statement of Changes in Equity (Unaudited)Aozora Bank, Ltd. and Consolidated SubsidiariesFor the six-month period ended September 30, 2015
Millions of Yen
Shareholders’ equity Accumulated other comprehensive income (loss)
Subscription rights to shares
Non-controlling interests Total equity
Capital stock
Capital surplus
Retained earnings
Treasury stock-at cost Total
Valuation difference
on available-for-sale
securities
Deferred gains or
losses on hedges
Foreign currency
translation adjustment
Remeasure-ments of defined benefit plans Total
Balance, April 1, 2014 . . . . . . . . . . . ¥100,000 ¥ 310,166 ¥209,848 ¥ (99,333) ¥ 520,681 ¥ (3,103) ¥ 295 ¥(6,882) ¥4,289 ¥ (5,400) ¥ — ¥757 ¥ 516,038
Cumulative effects of accounting change . . . . . . (74) (74) (74)
Restated balance . . . . . . . 100,000 310,166 209,773 (99,333) 520,606 (3,103) 295 (6,882) 4,289 (5,400) — 757 515,963
Net income attributable to owners of parent . . . . . 43,689 43,689 43,689
Cash dividends paid . . . . . (20,490) (18,428) (38,918) (38,918)
Net changes of items during the year . . . . . . . . . 38,035 (440) 8,091 901 46,587 81 9 46,679
Balance, April 1, 2015 . . . . . . . . . . . ¥100,000 ¥ 289,676 ¥235,035 ¥ (99,333) ¥ 525,377 ¥ 34,931 ¥ (145) ¥ 1,209 ¥5,191 ¥ 41,187 ¥ 81 ¥767 ¥ 567,414
Net income attributable to owners of parent . . . . . 24,297 24,297 24,297
Cash dividends paid . . . . . (20,490) (10,748) (31,238) (31,238)
Purchase of treasury stock . . . . . . . . . . . . . . . . (143,430) (143,430) (143,430)
Retirement of treasury stock . . . . . . . . . . . . . . . . (239,375) 239,375 — —
Transfer to capital surplus from retained earnings . . . . . . . . . . . . . . 57,502 (57,502) — —
Net changes of items during the period . . . . . . . (18,629) 2,352 (40) (576) (16,893) 100 1 (16,791)
Balance, September 30, 2015 . . . . ¥100,000 ¥ 87,313 ¥191,081 ¥ (3,388) ¥ 375,006 ¥ 16,301 ¥2,207 ¥ 1,168 ¥4,614 ¥ 24,293 ¥182 ¥769 ¥ 400,251
Thousands of U.S. Dollars (Note 1)
Shareholders’ equity Accumulated other comprehensive income (loss)
Subscription rights to shares
Non-controlling interests Total equity
Capital stock
Capital surplus
Retained earnings
Treasury stock-at cost Total
Valuation difference
on available-for-sale
securities
Deferred gains or
losses on hedges
Foreign currency
translation adjustment
Remeasure-ments of defined benefit plans Total
Balance, April 1, 2015 . . . . . . . . . . . $833,611 $ 2,414,774 $1,959,279 $ (828,055) $ 4,379,609 $ 291,195 $ (1,210) $10,079 $43,276 $ 343,340 $ 682 $6,398 $ 4,730,029
Net income attributable to owners of parent . . . . . 202,544 202,544 202,544
Cash dividends paid . . . . . (170,807) (89,600) (260,407) (260,407)
Purchase of treasury stock . . . . . . . . . . . . . . . . (1,195,649) (1,195,649) (1,195,649)
Retirement of treasury stock . . . . . . . . . . . . . . . . (1,995,461) 1,995,461 — —
Transfer to capital surplus from retained earnings . . . . . . . . . . . . . . 479,348 (479,348) — —
Net changes of items during the period . . . . . . . (155,300) 19,614 (336) (4,807) (140,829) 839 14 (139,976)
Balance, September 30, 2015 . . . . $833,611 $ 727,854 $1,592,875 $ (28,243) $ 3,126,097 $ 135,895 $18,404 $ 9,743 $38,469 $ 202,511 $1,521 $6,412 $ 3,336,541
See the accompanying notes to consolidated semiannual financial statements.
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017
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Consolidated Semiannual Financial Statements
Consolidated Semiannual Statement of Cash Flows (Unaudited)Aozora Bank, Ltd. and Consolidated SubsidiariesFor the six-month period ended September 30, 2015
Millions of Yen
Thousands ofU.S. Dollars
(Note 1)
Sep. 30, 2015(6 months)
Sep. 30, 2014(6 months)
Mar. 31, 2015(1 year)
Sep. 30, 2015(6 months)
Cash flows from operating activities:Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 29,672 ¥ 32,280 ¥ 53,912 $ 247,354 Adjustments for:
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,625 1,167 2,378 13,554 Impairment losses on long-lived assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 13 —Increase (decrease) in allowance for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (280) (4,201) (1,107) (2,341)Increase (decrease) in allowance for investment losses . . . . . . . . . . . . . . . . . . . . . . . . . . 272 (1,160) (1,485) 2,271 Increase (decrease) in net defined benefit asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (974) (962) (1,919) (8,120)Increase (decrease) in net defined benefit liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 41 192 342 Increase (decrease) in provision for directors’ retirement benefits . . . . . . . . . . . . . . . . . . . 0 (383) (382) 6 Increase (decrease) in provision for credit losses on off-balance-sheet instruments . . . . . 248 (579) (644) 2,068 Increase (decrease) in provision for contingent loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 8 — —Interest income (accrual basis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (32,541) (30,984) (63,398) (271,268)Interest expenses (accrual basis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,144 6,710 13,417 59,558 Loss (gain) on securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,568) (6,048) (6,769) (38,085)Loss (gain) on money held in trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (214) (8) (393) (1,784)Foreign exchange losses (gains) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,137) (44,148) (105,876) (42,830)Loss (gain) on disposal of noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 2 2 19 Net decrease (increase) in trading assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,472 (21,413) 5,775 420,746 Net increase (decrease) in trading liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (81,229) 11,103 (6,965) (677,139)Net decrease (increase) in loans and bills discounted . . . . . . . . . . . . . . . . . . . . . . . . . . . . 166,508 (60,737) (91,275) 1,388,032 Net increase (decrease) in deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,974 68,563 (24,987) 433,264 Net increase (decrease) in debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,725) 31,335 48,561 (39,395)Net increase (decrease) in borrowed money (excluding subordinated borrowings) . . . . . . 3,724 19,543 28,472 31,052 Net decrease (increase) in due from banks (excluding due from the Bank of Japan) . . . . . (12,906) (8,756) 6,571 (107,588)Net decrease (increase) in call loans and bills bought and others . . . . . . . . . . . . . . . . . . . 478 34,949 29,207 3,990 Net decrease (increase) in receivables under securities borrowing transactions . . . . . . . . 44,027 (15,091) (39,802) 367,022 Net increase (decrease) in call money and bills sold, payables under repurchase agreements and others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (13,689) (31,228) (15,793) (114,118)Net increase (decrease) in payables under securities lending transactions . . . . . . . . . . . . (36,408) 98,470 9,919 (303,506)Net decrease (increase) in foreign exchange—assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,287 (1,182) (4,263) 35,739 Net increase (decrease) in foreign exchange—liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . — (0) (0) —Increase (decrease) in straight bonds—issuance and redemption . . . . . . . . . . . . . . . . . . 10,000 — — 83,361 Interest and dividends received (cash basis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,607 31,832 64,073 280,156 Interest paid (cash basis) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,990) (9,697) (18,366) (66,613)Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (39,176) (5,747) (15,233) (326,576)
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164,245 93,676 (136,164) 1,369,171 Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,138) (2,427) (3,381) (17,827)
Net cash provided by (used in) operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . 162,107 91,248 (139,546) 1,351,344 Cash flows from investing activities:
Purchase of securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (516,734) (911,809) (1,654,822) (4,307,555)Proceeds from sales of securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 493,293 395,330 1,306,435 4,112,151 Proceeds from redemption of securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,336 486,026 661,641 311,243 Increase in money held in trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (30,568) (15,455) (59,429) (254,823)Decrease in money held in trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,722 11,094 43,703 331,130 Purchase of tangible fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (897) (214) (891) (7,483)Purchase of intangible fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,156) (1,616) (4,647) (26,312)Proceeds from sales of tangible fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 0 0 19
Net cash provided by (used in) investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,998 (36,644) 291,989 158,370 Cash flows from financing activities:
Repayments of lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (76) (73) (156) (641)Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (143,430) — — (1,195,649)Cash dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (31,238) (30,018) (38,918) (260,406)Cash dividends paid to non-controlling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8) (8) (8) (73)
Net cash used in financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (174,753) (30,100) (39,083) (1,456,769)Net increase in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,351 24,502 113,360 52,945 Cash and cash equivalents, beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500,900 387,540 387,540 4,175,563 Cash and cash equivalents, end of period (Note 3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 507,251 ¥ 412,042 ¥ 500,900 $ 4,228,508
See the accompanying notes to consolidated semiannual financial statements.
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018
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Notes to Consolidated Semiannual Financial Statements (Unaudited)Aozora Bank, Ltd. and Consolidated SubsidiariesInterim period ended September 30, 2015
2. Summary of Significant Accounting Policiesa. Use of Estimates—The preparation of consolidated
semiannual financial statements in accordance with Japanese
GAAP requires management to make estimates and assump-
tions that affect the reported amounts of assets and liabilities,
disclosures of contingent assets and liabilities at the date of
the consolidated semiannual financial statements, and the
reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those esti-
mates. Material estimates that are particularly susceptible to
significant change in the near term include, but are not limited
to, those that are related to the determination of the allow-
ance for loan losses, deferred tax assets, and the valuation of
financial instruments.
b. Consolidation—The consolidated semiannual financial
statements include the accounts of the Bank and its signifi-
cant subsidiaries. The number of consolidated subsidiaries
was 16 as of September 30, 2015.
AZB Funding 6 was established and consolidated from the
six-month period ended September 30, 2015.
Under the control and influence concepts, those entities
in which the Bank, directly or indirectly, is able to exercise
control over finance and operations are fully consolidated,
and those entities over which the Group has the ability to
exercise significant influence should be accounted for by
the equity method.
Practical Issues Task Force (‘PITF’) No. 20, ‘Practical
Solution on Application of Control Criteria and Influence
Criteria to Investment Associations,’ issued by the Accounting
Standards Board of Japan (‘ASBJ’), provides additional
guidance on how the control and influence concepts should
be practically applied to investment vehicles, such as limited
partnerships, tokumei kumiai arrangements (a silent partner-
ship under the Commercial Code of Japan), and other entities
with similar characteristics in order to prevent these invest-
ment vehicles from being inappropriately excluded from
consolidation.
The consolidated semiannual financial statements do not
include the accounts of certain subsidiaries such as Aozora
Chiiki Saisei Co., Ltd., because the combined total assets,
total income, net income (loss) and retained earnings, etc.,
of such subsidiaries would not have a material effect on the
accompanying consolidated semiannual financial statements.
Investments in unconsolidated subsidiaries and affiliated
companies, such as Vietnam International Leasing Company
Limited and AZ-Star Co., Ltd., are generally stated at cost.
These companies are not accounted for using the equity
method of accounting because the effect on the accompany-
ing consolidated semiannual financial statements would not
be material even if the equity method of accounting had been
applied to the investments in these companies.
1. Basis of Presentation of Consolidated Semiannual Financial Statementsthe 2014 consolidated financial statements to conform to
the classifications used in the consolidated semiannual
financial statements for the six-month period ended
September 30, 2015.
The consolidated semiannual financial statements are
stated in Japanese yen, the currency of the country in which
the Bank is incorporated and operates. Japanese yen figures
of less than one million yen are truncated, except for per
share data. As a result, the totals do not necessarily equal the
sum of the individual amounts. The translation of Japanese
yen amounts into U.S. dollar amounts is included solely for
the convenience of readers outside Japan and has been
made at the rate of ¥119.96 to $1.00, the rate of exchange
at September 30, 2015. Such translations should not be
construed as representations that the Japanese yen amounts
could be converted into U.S. dollars at that or any other rate.
The accompanying consolidated semiannual financial
statements of Aozora Bank, Ltd. (the ‘Bank’) and consoli-
dated subsidiaries (together, the ‘Group’) have been prepared
in accordance with the provisions set forth in the Japanese
Financial Instruments and Exchange Act, the Banking Act of
Japan and other related accounting regulations, and in accor-
dance with accounting principles generally accepted in Japan
(‘Japanese GAAP’), which are different in certain respects as
to the application and disclosure requirements of International
Financial Reporting Standards.
In preparing these consolidated semiannual financial
statements, certain reclassifications and rearrangements
have been made to the consolidated semiannual financial
statements issued domestically in order to present them
in a form which is more familiar to readers outside Japan.
In addition, certain reclassifications have been made in
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019
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Consolidated Semiannual Financial Statements
The difference between the cost of an acquisition and the
fair value of the net assets of the acquired subsidiaries at the
date of acquisition is charged to operations when incurred
due to its immateriality. A bargain purchase gain is charged to
operations on the acquisition date after reassessing the pro-
cedures of acquisition price allocation to ensure that an
acquirer has correctly identified all of the assets acquired
and all of the liabilities assumed with a review of such
procedures used.
All significant intercompany balances and transactions
are eliminated in consolidation. All material unrealized
profits resulting from transactions within the Group are
also eliminated.
The ASBJ issued ASBJ Implementation Guidance No. 22,
‘Implementation Guidance on Determining a Subsidiary and
an Affiliate for Consolidated Financial Statements,’ on May 13,
2008, which clarifies the conditions where a company does
not regard an entity as a subsidiary even if the controlling
interest of the entity is held by the company. This accounting
regulation was implemented from the fiscal year commencing
on and after October 1, 2008, and was applied by the Group
from the year ended March 31, 2010.
In accordance with PITF No. 18, ‘Practical Solution on
Unification of Accounting Policies Applied to Foreign
Subsidiaries for the Consolidated Financial Statements,’ for-
eign subsidiaries’ financial statements prepared in accordance
with either International Financial Reporting Standards or gen-
erally accepted accounting principles in the United States are
used for the consolidation process with certain limitations.
c. Cash and Cash Equivalents—Cash and cash equivalents
consist of cash on hand and due from the Bank of Japan.
d. Trading Assets/Liabilities—Transactions for trading
purposes (for the purpose of seeking to capture gains arising
from short-term changes in interest rates, currency exchange
rates or market prices of securities and other market-related
indices or arbitrage opportunities) are included in ‘Trading
assets’ or ‘Trading liabilities,’ as appropriate, on a trade-date
basis. Trading assets and liabilities are stated at fair value.
Profits and losses on transactions for trading purposes are
shown as ‘Trading income’ and ‘Trading expenses,’ as
appropriate, on a trade-date basis.
e. Securities—All securities are classified and accounted for,
depending on management’s intent, as follows:
(1) trading securities which are held for the purpose of earning
capital gains in the near term (other than securities booked in
trading accounts) are reported at fair value, and the related
unrealized gains and losses are recognized in the consoli-
dated semiannual statement of income, (2) held-to-maturity
debt securities which are expected to be held to maturity with
the positive intent and ability to hold them to maturity are
reported at amortized cost and (3) available-for-sale securities
are reported at fair value, with unrealized gains and losses, net
of applicable taxes, reported within accumulated other com-
prehensive income as a separate component of equity. The
cost of sale of these securities is determined mainly by the
moving-average method.
The measurement at cost or amortized cost of available-for-
sale securities is prohibited, unless the fair value cannot be
reliably determined under ‘Accounting Standard for Financial
Instruments’ (the ASBJ Statement No. 10).
Nonmarketable equity securities are generally regarded as
securities whose fair value cannot be reliably determined and
are measured at cost. However, certain nonmarketable debt
securities, such as privately placed corporate bonds and cer-
tain asset-backed securities, are measured at fair value. The
cost of sale of nonmarketable available-for-sale securities
stated at cost is determined by the moving-average method.
For other-than-temporary declines in fair value, the cost of
securities is reduced to fair value and the impairment losses
are recognized by a charge to operations.
The Group records its interests in investment limited part-
nerships, associations under the Civil Code of Japan, and
tokumei kumiai arrangements, based on its proportionate
share of the net assets in such entities, and recognizes its
share of profits or losses in a manner similar to the equity
method of accounting. The Group records such interests
in ‘Securities.’
Securities included in money held in trust on behalf of the
Group are accounted for in the same manner as the securities
mentioned above.
f. Derivatives and Hedging Activities—Derivative financial
instruments (other than derivatives booked in trading
accounts) are classified and accounted for as follows:
(1) All derivatives other than those used for hedging purposes
are recognized as either assets or liabilities and measured
at fair value, with gains or losses recognized currently in
the consolidated semiannual statement of income.
(2) Derivatives used for hedging purposes, if they meet certain
hedging criteria, including high correlation of fair value
movement and effectiveness between the hedging instru-
ments and the hedged items and the assessment of its
effectiveness, are recognized as either assets or liabilities
and measured at fair value. Valuation gains or losses on
derivatives used for hedging purposes are primarily
deferred over the terms of the hedged items within accu-
mulated other comprehensive income as a component of
equity and are charged to operations when the gains and
losses on the hedged items are recognized.
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020
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Hedges of Interest Rate Risk
The Bank applies deferral hedge accounting to hedges of
interest rate risk associated with financial assets and liabilities
in accordance with ‘Accounting and Auditing Treatments
on the Application of Accounting Standards for Financial
Instruments in the Banking Industry’ (the Japanese Institute
of Certified Public Accountants (‘JICPA’) Industry Audit
Committee Report No. 24, February 13, 2002).
Under the JICPA Industry Audit Committee Report No. 24,
hedges to offset changes in fair value of fixed-rate instruments
(such as loans or deposits) (‘fair value hedges’) are applied by
grouping hedging instruments and hedged items by their
maturities. The assessment of hedge effectiveness is generally
based on the consideration of interest rate indices affecting
the respective fair values of the group of hedging instruments
and hedged items.
Hedges of Foreign Currency Risk
The Bank applies deferral hedge accounting to hedges of
foreign currency risk associated with foreign currency-
denominated financial assets and liabilities in accordance
with ‘Accounting and Auditing Treatments for Foreign
Currency Transactions in the Banking Industry’ (the JICPA
Industry Audit Committee Report No. 25, July 29, 2002).
In accordance with the JICPA Industry Audit Committee
Report No. 25, the Bank designates certain currency swaps
and foreign exchange swaps for the purpose of funding for-
eign currencies as hedges for the exposure to changes in
foreign exchange rates associated with foreign currency-
denominated assets or liabilities when the foreign currency
positions on the hedged assets or liabilities are expected to
exceed the corresponding foreign currency positions on the
hedging instruments. Hedge effectiveness is reviewed by
comparing the total currency position of the hedged items
with that of the hedging instruments by currency.
For hedging the foreign currency exposure of foreign
currency-denominated available-for-sale securities (other than
debt securities), which were designated in advance, fair value
hedge accounting is adopted on a portfolio basis when the
cost of the hedged securities is covered with offsetting
liabilities denominated in the same foreign currency as the
hedged securities.
Hedges of Stock Price Risk
The Bank designates an available-for-sale security (stock,
etc.) as a hedged item and total return swaps, etc., as
hedging instruments and applies individual deferral hedge
accounting.
The assessment of hedge effectiveness is generally based
on the comparison of changes in value of the hedged item
and hedging instruments.
Intercompany and Intracompany Derivative Transactions
For intercompany and intracompany derivative transactions
for hedging purposes (‘internal derivatives’), including cur-
rency and interest rate swaps, the Bank currently charges
gains and losses on internal derivatives to operations or
defers them within accumulated other comprehensive income
as a component of equity without elimination in accordance
with the JICPA Industry Audit Committee Reports No. 24 and
No. 25. These Reports permit a bank to retain the gains and
losses on internal derivatives in its consolidated semiannual
financial statements without elimination if the bank establishes
and follows strict hedging criteria by entering into mirror-
image offsetting transactions with external third parties within
three business days after the designation of internal derivatives
as hedging instruments.
g. Tangible Fixed Assets and Intangible Fixed Assets—
Tangible fixed assets and intangible fixed assets are stated
at cost.
Depreciation of tangible fixed assets of the Group is
computed primarily by the declining-balance method at
rates based on the estimated useful lives of the assets,
while the straight-line method is applied to buildings of the
Bank. The ranges of useful lives are principally from 15 years
to 50 years for buildings and from 5 years to 15 years for
other tangible fixed assets.
Amortization of intangible fixed assets of the Group is com-
puted by the straight-line method over the estimated useful
lives of the assets. Costs of software developed or obtained
for internal use are amortized over the estimated useful lives
of the software (principally five years).
Lease assets under finance lease transactions, in which
substantial ownership is not deemed to be transferred, are
depreciated by the straight-line method over the lease term.
The salvage value is zero or the guaranteed amounts if
specified in the lease contracts.
h. Long-lived Assets—The Group reviews its long-lived
assets for impairment whenever events or changes in circum-
stances indicate that the carrying amount of an asset or asset
group may not be recoverable. An impairment loss would be
recognized if the carrying amount of an asset or asset group
exceeds the sum of the undiscounted future cash flows
expected to result from the continued use and eventual dis-
position of the asset or asset group. The impairment loss
would be measured as the amount by which the carrying
amount of the asset exceeds its recoverable amount, which is
the higher of the discounted cash flows from the continued
use and eventual disposition of the asset or asset group or
the net selling price at disposition.
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021
Financial and C
orporate Data
Consolidated S
emiannual
Financial Statem
ents
Consolidated Semiannual Financial Statements
i. Deferred Charges—Debenture issuance expenses are
deferred and amortized by the straight-line method over the
terms of the debentures.
Corporate bond issuance expenses are deferred and
amortized by the straight-line method over the terms of the
corporate bonds.
j. Write-off of Loans and Allowance for Loan Losses—
Loans to borrowers who are assessed as ‘Bankrupt’ (in the
process of legal proceedings for bankruptcy, special liquida-
tion, etc.) or ‘De facto bankrupt’ (in serious financial difficulties
and are not deemed to be capable of restructuring) under the
Bank’s self-assessment guidelines are written off to the
amounts expected to be collected through the disposal of
collateral or execution of guarantees, etc. The amounts
deemed to be uncollectible and written off were ¥25,407
million ($211,797 thousand) and ¥28,128 million at
September 30 and March 31, 2015, respectively.
For loans to borrowers who are assessed as ‘In danger of
bankruptcy’ (not yet bankrupt but are in financial difficulty
and are highly likely to go bankrupt in the foreseeable future),
a specific allowance is provided for the loan losses at an
amount considered to be necessary based on an overall
solvency assessment of the borrowers and expected collect-
ible amounts through the disposal of collateral or execution
of guarantees, etc. For loans whose future cash flows of
principal and interest are reasonably estimated, the differ-
ence between the discounted cash flows and the carrying
amount is accounted for as an allowance for loan losses
(the ‘DCF method’).
For other loans, the Bank provides a general allowance by
applying the estimated loan loss ratio, determined based on
the historical loan loss data over a defined period in the past.
However, for borrowers with a large credit exposure, catego-
rized as ‘Need attention’, etc., under the internal credit rating
system, the loan loss amount estimated by the DCF method
is reflected as an addition to the allowance for loan losses cal-
culated based on the estimated loan loss ratio, if necessary.
An allowance for loans to restructuring countries is provided
for the amount of expected losses based on an assessment
of political and economic conditions in their respective
countries.
All loans are monitored in line with an internal self-
assessment standard, etc., on an ongoing basis. Operating
divisions or branches review internal credit ratings of bor-
rowers (‘Borrower Ratings’) which are defined in line with
‘borrower categories’ and those ratings are then approved
by the divisions in charge of credit. The division in charge
of asset assessment, which is independent of operating
divisions or branches and the divisions in charge of credit,
reviews the appropriateness of internal credit ratings on a
sample basis.
Based upon the borrower categories determined by the
aforementioned process as of the balance sheet date, oper-
ating divisions and branches initially compute the amounts
of write-offs and allowance, and the division in charge of
asset assessment verifies the amounts and determines the
final amounts.
With regard to the allowance for loan losses of consolidated
subsidiaries, a general allowance is calculated for the amount
of estimated loan losses using historical loan loss data over
a defined period in the past. For loans to ‘In danger of bank-
ruptcy’ borrowers and ‘De facto bankrupt’ and ‘Bankrupt’
borrowers, a specific allowance is provided or the uncollect-
ible amount is written off based on an assessment of
collectibility of individual loans.
The independent internal audit divisions periodically audit
the appropriateness of the write-off and allowances based on
the self-assessment.
k. Allowance for Investment Losses—An allowance for
investment losses is provided for estimated losses on certain
investments based on an assessment of the issuers’ financial
condition and uncertainty about future recoverability of the
decline in realizable values of the investments.
l. Asset Retirement Obligations—An asset retirement
obligation is defined as a legal obligation imposed either by
law or contract that results from the acquisition, construction,
development and the normal operation of a tangible fixed
asset and is associated with the retirement of such a tangible
fixed asset. The asset retirement obligation is recognized as
the sum of the discounted cash flows required for the future
asset retirement and is recorded in the period in which the
obligation is incurred if a reasonable estimate can be made. If
a reasonable estimate of the asset retirement obligation can-
not be made in the period the asset retirement obligation is
incurred, the liability should be recognized when a reasonable
estimate of asset retirement obligation can be made. Upon
initial recognition of a liability for an asset retirement obligation,
an asset retirement cost is capitalized by increasing the carry-
ing amount of the related fixed asset by the amount of the
liability. The asset retirement cost is subsequently allocated to
expense through depreciation over the remaining useful life of
the asset. Over time, the liability is accreted to its present
value each period. Any subsequent revisions to the timing or
the amount of the original estimate of undiscounted cash
flows are reflected as an increase or a decrease in the carry-
ing amount of the liability and the capitalized amount of the
related asset retirement cost.
m. Provision for Directors’ Retirement Benefits—
The provision for directors’ retirement benefits is provided
at the amount that would be required if directors and Audit
& Supervisory Board members of some consolidated
subsidiaries retired at the balance sheet date.
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ents
n. Provision for Credit Losses on Off-balance-sheet
Instruments—Provision for credit losses on off-balance-sheet
instruments is provided for credit losses on commitments to
extend loans and other off-balance-sheet financial instru-
ments based on an estimated loss ratio or individually
estimated loss amount determined by the same methodology
used in determining the amount of allowance for loan losses.
o. Provision for Contingent Loss—Provision for contingent
loss is maintained for possible losses from contingencies,
which are not covered by other reserves.
p. Reserve under Special Laws—Reserve under special
laws is a reserve for financial products’ transaction liabilities
which is provided for compensation for losses from securities
brokering in consolidated domestic subsidiaries in accor-
dance with the Financial Instruments and Exchange Act,
Article 46-5 and the Cabinet Office Ordinance on Financial
Instruments Business, Article 175.
q. Retirement and Pension Plans—The Group accounts for
net defined benefit liabilities (assets) based on the projected
benefit obligations and plan assets at the balance sheet date.
The projected benefit obligations are calculated based on the
benefit formula attribution of the expected benefit over the
service period of employees. Prior-service cost is amortized
using the straight-line method over a period (nine years) within
the employees’ average remaining service period at incur-
rence. Net actuarial gain and loss are amortized using the
straight-line method over a period (five years) within the
employees’ average remaining service period commencing
from the next fiscal year after incurrence.
Some consolidated subsidiaries adopt a simplified method
based on the defined retirement benefit obligations for each
retirement plan that would be required if all employees retired
voluntarily at the consolidated balance sheet date.
r. Lease Transactions—All finance lease transactions are
capitalized to recognize lease assets and lease obligations on
the balance sheet.
All other leases are accounted for as operating leases.
s. Income Taxes—Deferred income taxes are recorded to
reflect expected future consequences of temporary differ-
ences between assets and liabilities recognized for financial
reporting purposes and such amounts recognized for tax
purposes. These deferred taxes are measured by applying
currently enacted tax rates to the temporary differences. The
Bank assesses the realizability of deferred tax assets based
on consideration of the available evidence, including future
taxable income, future reversals of existing temporary
differences, and tax-planning strategies. The Bank reduces
the carrying amount of a deferred tax asset to the extent that
it is not probable that sufficient taxable income will be avail-
able to allow the benefit of part or all of that deferred tax asset
to be realized. Such reduction may be reversed to the extent
that it becomes probable that sufficient taxable income will be
available and warrant the realization of tax benefits.
t. Foreign Currency Items—Assets and liabilities denomi-
nated in foreign currencies held by the Bank are translated
into Japanese yen at the exchange rates prevailing at the
balance sheet date except for investments in equity securities
of unconsolidated subsidiaries or affiliated companies, which
are translated at historical rates.
Assets and liabilities denominated in foreign currencies
which are held by consolidated subsidiaries are translated into
Japanese yen at the exchange rates as of the consolidated
balance sheet date, while equity accounts are translated at
historical rates. Differences arising from such translations are
shown as ‘Foreign currency translation adjustment’ within
accumulated other comprehensive income as a separate
component of equity.
Revenue and expense accounts of consolidated foreign
subsidiaries are translated into Japanese yen at the average
exchange rate. Differences arising from such translation are
included in ‘Non-controlling interests’ or ‘Foreign currency
translation adjustment’ as a separate component of equity
in the balance sheets.
u. Per-Share Information—Basic net income (loss) per
share is computed by dividing net income (loss) attributable
to common stockholders by the weighted-average number
of shares of common stock outstanding for the period,
retroactively adjusted for stock splits or reverse stock splits.
Diluted net income per share reflects the potential dilution
that would occur if dilutive options and warrants were exer-
cised or the securities were converted into common stock,
also retroactively adjusted for stock splits or reverse stock
splits. Diluted net income per share of common stock
assumes full conversion of the preferred stock at the begin-
ning of the year (or at the time of issuance) with an applicable
adjustment for related dividends to preferred stock, unless the
preferred stock has an antidilutive effect.
Net assets per share of common stock are computed by
dividing net assets attributable to common stockholders by
number of shares of common stock outstanding at the end
of the period.
Cash dividends per share presented in the accompanying
consolidated semiannual statement of income are dividends
applicable to the respective years including dividends to be
paid after the end of the period.
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ents
Consolidated Semiannual Financial Statements
v. Accounting Changes and Error Corrections— In
December 2009, the ASBJ issued ASBJ Statement No. 24,
‘Accounting Standard for Accounting Changes and Error
Corrections’ and ASBJ Guidance No. 24, ‘Guidance on
Accounting Standard for Accounting Changes and Error
Corrections.’ Accounting treatments under this standard and
guidance are as follows:
(1) Changes in Accounting Policies
When a new accounting policy is applied due to a revision
of accounting standards, the new policy is applied retro-
spectively unless the revised accounting standards include
specific provisions. When the revised accounting stan-
dards include specific provisions, a company shall comply
with the specific provisions.
(2) Changes in Presentation
When the presentation of consolidated financial state-
ments is changed, prior-period financial statements are
reclassified in accordance with the new presentation.
(3) Changes in Accounting Estimates
A change in an accounting estimate is accounted for in
the period of the change if the change affects that period
only and is accounted for prospectively if the change
affects both the period of the change and future periods.
(4) Corrections of Prior-Period Errors
When an error in prior-period consolidated financial
statements is discovered, those consolidated financial
statements are restated.
5. Trading Assets and LiabilitiesTrading assets and liabilities as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Trading assets:
Securities related to trading transactions . . . . . . . . . . . . ¥ 61,709 ¥ 70,718 $ 514,416
Derivatives of securities related to trading transactions . . 789 123 6,584
Trading-related financial derivatives . . . . . . . . . . . . . . . . 234,132 276,262 1,951,759
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥296,632 ¥347,104 $2,472,759
Trading liabilities:
Derivatives of securities related to trading transactions . . ¥ 868 ¥ 123 $ 7,244
Trading-related financial derivatives . . . . . . . . . . . . . . . . 229,159 311,133 1,910,298
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥230,028 ¥311,257 $1,917,542
4. Cash and Cash EquivalentsCash and cash equivalents as of September 30, 2015 and 2014, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 2015 Sep. 2014 Sep. 2015
Cash on hand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 11,203 ¥ 15,448 $ 93,390
Due from the Bank of Japan . . . . . . . . . . . . . . . . . . . . . . . . . . 496,048 396,594 4,135,118
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥507,251 ¥412,042 $4,228,508
3. Accounting Changeperiod starting on April 1, 2015. Due to the application,
the presentation of net income and related items is changed,
and the terminology is changed from minority interests to
non- controlling interests. The consolidated financial state-
ments for the six-month period ended September 30, 2014
and for the fiscal year ended March 31, 2015 are reclassified
to reflect these changes.
The Bank has applied ‘Accounting Standard for Business
Combinations’ (the ASBJ Statement No. 21, September 13,
2013), ‘Accounting Standard for Consolidated Financial
Statements’ (the ASBJ Statement No. 22, September 13,
2013), ‘Accounting Standard for Business Divestitures’
(the ASBJ Statement No. 7, September 13, 2013) and
other related standards from the beginning of the six-month
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No held-to-maturity bond was held as of September 30 and March 31, 2015.
The costs and carrying amounts of available-for-sale securities with fair value as of September 30 and March 31, 2015, were as follows:
Millions of Yen Thousands of U.S. Dollars
Carrying amount Cost Difference
Carrying amount Cost Difference
September 30, 2015
Carrying amount exceeding cost:
Japanese stocks . . . . . . . . . . . . . . . . . . . . . ¥ 38,803 ¥ 13,653 ¥ 25,150 $ 323,471 $ 113,813 $ 209,658
Japanese national government bonds . . . . . 8,106 8,079 26 67,573 67,351 222
Japanese local government bonds . . . . . . . . 10,163 10,032 131 84,725 83,630 1,095
Japanese corporate bonds . . . . . . . . . . . . . 28,170 27,917 252 234,830 232,724 2,106
Foreign bonds . . . . . . . . . . . . . . . . . . . . . . . 192,531 191,320 1,210 1,604,963 1,594,869 10,094
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91,528 79,087 12,441 762,992 659,280 103,712
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369,303 330,090 39,213 3,078,554 2,751,667 326,887
Carrying amount not exceeding cost:
Japanese stocks . . . . . . . . . . . . . . . . . . . . . 584 626 (42) 4,872 5,225 (353)
Japanese national government bonds . . . . . 127,300 127,301 (1) 1,061,187 1,061,201 (14)
Japanese local government bonds . . . . . . . . 4,819 4,830 (10) 40,180 40,271 (91)
Japanese corporate bonds . . . . . . . . . . . . . 10,552 10,965 (412) 87,967 91,407 (3,440)
Foreign bonds . . . . . . . . . . . . . . . . . . . . . . . 125,789 127,349 (1,559) 1,048,597 1,061,601 (13,004)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237,147 250,127 (12,980) 1,976,886 2,085,091 (108,205)
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506,193 521,201 (15,007) 4,219,689 4,344,796 (125,107)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥875,497 ¥851,291 ¥ 24,205 $7,298,243 $7,096,463 $ 201,780
6. SecuritiesCertain amounts shown in the following tables include certain beneficiary interests in trust classified as ‘Monetary claims bought’ in
addition to ‘Securities’ stated in the consolidated semiannual balance sheets.
‘Securities’ stated in the consolidated semiannual balance sheets as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Japanese national government bonds . . . . . . . . . . . . . . . . . . ¥135,406 ¥193,993 $1,128,760Japanese local government bonds . . . . . . . . . . . . . . . . . . . . . 14,983 18,515 124,905Japanese corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,722 39,298 322,797Japanese stocks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,332 41,766 361,227Foreign bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318,321 370,442 2,653,561Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 398,814 320,043 3,324,565
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥949,581 ¥984,060 $7,915,815
As of September 30 and March 31, 2015, securities included equity investments in unconsolidated subsidiaries and affiliated
companies that amounted to ¥22,488 million ($187,463 thousand) and ¥15,675 million, respectively.
As of September 30 and March 31, 2015, the Group extended guarantees of ¥225 million ($1,876 thousand) and ¥325 million,
respectively, to certain Japanese corporate bonds issued in private placements.
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Consolidated Semiannual Financial Statements
The Group has adopted its impairment criteria based on
the severity of decline of securities by ‘borrower category’
of the issuer of securities in the determination of significant
declines. A significant decline is regarded as an other-than-
temporary decline unless the significant decline is reasonably
recoverable. Impairment losses are recognized for other-than-
temporary declines.
For the six-month period ended September 30 and the year
ended March 31, 2015, the Group wrote off marketable avail-
able-for-sale securities in the amounts of ¥0 million ($0 thou-
sand) and ¥0 million, respectively, as other than temporary
declines. The breakdown of write-offs for the six-month period
ended September 30, 2015, was ¥0 million ($0 thousand) for
foreign bonds. The breakdown of write-offs for the year ended
March 31, 2015 was ¥0 million for foreign bonds.
If fair value declines more than 50% from the acquisition
cost or amortized cost, the Group generally deems the
decline to be significant and other-than-temporary. However,
based on the borrower category of the issuer of securities, the
following impairment criteria determine whether or not the fair
value decline is significant under the internal standards for
write-offs and reserves.
‘In danger of bankruptcy,’ ‘De facto bankrupt’ and
‘Bankrupt’ … If fair value declines from cost.
‘Need attention’ … If fair value declines more than 30%
from cost.
‘Normal’ … If fair value declines more than 50% from cost.
For debt securities categorized as ‘Normal,’ the fair value
decline is deemed significant if fair value declines more than
30% from cost.
For securities, other than debt securities, whose fair value
remains below a certain level, the fair value decline is deemed
significant even if it does not meet the above criteria.
‘Bankrupt’ borrower means an issuer of securities under
legal proceedings, such as bankruptcy or liquidation.
‘De facto bankrupt’ borrower means an issuer of securities in
a similar condition as ‘Bankrupt’ borrower. ‘In danger of bank-
ruptcy’ borrower means an issuer of securities that is not cur-
rently bankrupt but is highly likely to become bankrupt. ‘Need
attention’ borrower means an issuer of securities that needs
to be monitored carefully. ‘Normal’ borrower means an issuer
of securities categorized as other than ‘Bankrupt,’ ‘De facto
bankrupt,’ ‘In danger of bankruptcy’ or ‘Need attention.’
Of securities received under unsecured lending agree-
ments, lending agreements with cash collateral or resale
agreements, etc., and securities received as collateral for
derivative transactions, which permit borrowers to sell or
repledge such securities received, ¥4,401 million ($36,690
thousand) and ¥2,791 million were repledged, and none were
loaned under such agreements and ¥6,625 million ($55,234
thousand) and ¥10,495 million remained undisposed, as of
September 30 and March 31, 2015, respectively.
Millions of Yen Thousands of U.S. Dollars
Carrying amount Cost Difference
Carrying amount Cost Difference
March 31, 2015
Carrying amount exceeding cost:
Japanese stocks . . . . . . . . . . . . . . . . . . . . . ¥ 39,978 ¥ 13,653 ¥26,325
Japanese national government bonds . . . . . 193,993 193,080 913
Japanese local government bonds . . . . . . . . 12,506 12,350 156
Japanese corporate bonds . . . . . . . . . . . . . 24,748 24,434 314
Foreign bonds . . . . . . . . . . . . . . . . . . . . . . . 313,594 309,120 4,473
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 166,139 144,863 21,275
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . 750,960 697,501 53,458
Carrying amount not exceeding cost:
Japanese stocks . . . . . . . . . . . . . . . . . . . . . 884 939 (55)
Japanese national government bonds . . . . . — — —
Japanese local government bonds . . . . . . . . 6,009 6,028 (19)
Japanese corporate bonds . . . . . . . . . . . . . 14,550 14,817 (267)
Foreign bonds . . . . . . . . . . . . . . . . . . . . . . . 56,848 57,737 (889)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87,328 88,464 (1,135)
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165,621 167,988 (2,367)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥916,581 ¥865,490 ¥51,091
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The above amounts are stated after write-offs of uncol-
lectible amounts but before deduction of the allowance for
loan losses.
‘Loans to bankrupt borrowers’ are loans to borrowers who
are legally bankrupt and are placed on nonaccrual status.
‘Past due loans’ are loans on which accrued interest
income is not recognized, excluding loans to bankrupt
borrowers and loans on which interest payments are
deferred in order to support the borrowers’ recovery from
financial difficulties. ‘Past due loans’ include loans to
borrowers who are assessed as ‘In danger of bankruptcy’
and ‘De facto bankrupt’ under the self-assessment
guidelines.
‘Loans overdue for three months or more’ are accruing
loans for which principal or interest remains unpaid for at
least three months, excluding loans to bankrupt borrowers
and past due loans.
‘Restructured loans’ are loans in which lending conditions
have been relaxed, such as by reducing the interest rate
or by forbearing interest payments or principal repayments
to support the borrowers’ recovery, excluding loans to
bankrupt borrowers, past due loans and loans overdue for
three months or more.
Overdraft contracts and contracts for loan commitments
are those by which the Group is bound to extend loans up
to a prearranged amount, upon the request of customers,
unless the customer is in breach of contract conditions. The
unutilized balance of these contracts amounted to ¥561,807
million ($4,683,287 thousand) and ¥613,870 million as of
September 30 and March 31, 2015, respectively. ¥427,364
million ($3,562,562 thousand) and ¥443,327 million of these
amounts relate to contracts with residual contractual terms
of one year or less as of September 30 and March 31, 2015,
respectively.
Bills discounted are accounted for as financing
transactions in accordance with the JICPA Industry Audit
Committee Report No. 24, although the Bank has the right
to sell or pledge them without restriction. The face values
of such bills discounted held as of September 30 and
March 31, 2015 were ¥79 million ($660 thousand) and
¥611 million, respectively.
7. Money Held in TrustThe carrying amounts and related valuation gains recognized in earnings for money held in trust classified as for investment
purposes as of September 30 and March 31, 2015, were as follows:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Carrying amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥13,871 ¥23,635 $115,633 Unrealized gains recognized in earnings . . . . . . . . . . . . . . . . . — — —
None of the money held in trust was categorized as held-to-maturity or available-for-sale securities as of September 30 and
March 31, 2015.
8. Loans and Bills DiscountedLoans and bills discounted as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Bills discounted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 79 ¥ 611 $ 660Loans on notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,597 44,050 338,421Loans on deeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,365,447 2,476,861 19,718,636Overdrafts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 198,646 250,861 1,655,936Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,621 3,431 46,863
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥2,610,391 ¥2,775,817 $21,760,516
The following risk-monitored loans were included in loans and bills discounted as of September 30 and March 31, 2015:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Loans to bankrupt borrowers . . . . . . . . . . . . . . . . . . . . . . . . . ¥ — ¥ — $ —Past due loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,999 26,374 175,050Loans overdue for three months or more . . . . . . . . . . . . . . . . — — — Restructured loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,757 12,543 39,656
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥25,756 ¥38,917 $214,706
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9. Foreign ExchangeForeign exchange as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Assets:Due from foreign banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥24,972 ¥29,259 $208,172
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥24,972 ¥29,259 $208,172
10. Tangible Fixed Assets and Intangible Fixed AssetsTangible fixed assets as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥10,767 ¥10,870 $ 89,757Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,235 9,235 76,988Lease assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 544 620 4,537Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 8 72Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,335 1,327 11,133
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥21,891 ¥22,062 $182,487
Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥25,330 ¥24,632 $211,156
Intangible fixed assets as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥9,708 ¥7,154 $80,928Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 70 585
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥9,778 ¥7,225 $81,513
11. Customers’ Liabilities for Acceptances and GuaranteesAll contingent liabilities arising from acceptances and guarantees are included in acceptances and guarantees. As a contra
account, customers’ liabilities for acceptances and guarantees are shown as assets representing the Group’s right of indemnity
from customers.
12. Allowance for Loan Losses Allowance for loan losses as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥54,329 ¥55,065 $452,896Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,121 8,665 76,036
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥63,450 ¥63,731 $528,932
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13. Pledged Assets and Collateralized DebtsThe carrying amounts of assets pledged as collateral and collateralized debts as of September 30 and March 31, 2015, were as follows:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Assets pledged as collateral: Trading assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 61,709 ¥ 77,530 $ 514,416 Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 280,973 303,662 2,342,227 Loans and bills discounted . . . . . . . . . . . . . . . . . . . . . . . . . 52,763 66,171 439,841
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥395,446 ¥447,364 $3,296,484
Collateralized debts: Call money and bills sold . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 80,000 ¥ 80,000 $ 666,889 Payables under securities lending transactions . . . . . . . . . . 256,612 293,020 2,139,147 Borrowed money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,490 54,255 287,513
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥371,102 ¥427,275 $3,093,549
14. DepositsDeposits as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Current deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 22,645 ¥ 19,497 $ 188,773Ordinary deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381,989 402,629 3,184,311Deposits at notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,660 2,270 38,850Time deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,314,726 2,256,013 19,295,822Negotiable certificates of deposit . . . . . . . . . . . . . . . . . . . . . . 298,700 286,653 2,489,997Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,999 17,683 116,699
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥3,036,721 ¥2,984,747 $25,314,452
In addition, the following assets were pledged or deposited as margin money for future trading and collateral for transactions,
including exchange settlements and derivatives as of September 30 and March 31, 2015:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥31,500 ¥ 65,861 $262,589 Foreign exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,996 12,022 100,000 Other assets
Cash collateral paid for financial instruments . . . . . . . . . . . . 36,181 38,208 301,613 Guarantee deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,543 3,902 71,220
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥88,221 ¥119,994 $735,422
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15. Debentures and Bonds PayableThe Bank converted its long-term credit bank charter to an ordinary commercial bank charter on April 1, 2006. The Financial
Services Agency of Japan, however, allows the Bank to retain the ability to issue debentures without registration, which was one
of the benefits the Bank enjoyed as a long-term credit bank, for a period of ten years following the conversion to an ordinary
commercial bank.
Debentures as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands of U.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Two-year coupon debentures . . . . . . . . . . . . . . . . . . . . . . . . ¥ 74,750 ¥101,850 $ 623,124Three-year coupon debentures . . . . . . . . . . . . . . . . . . . . . . . 138,350 135,000 1,153,301Five-year coupon debentures . . . . . . . . . . . . . . . . . . . . . . . . 28,286 9,262 235,797
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥241,386 ¥246,112 $2,012,222
Bonds payable as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands of U.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Unsecured straight bond issued by the Bank . . . . . . . . . . . . . ¥10,000 ¥— $83,361
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥10,000 ¥— $83,361
16. Other Assets and LiabilitiesOther assets and liabilities as of September 30 and March 31, 2015, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Other assets:Accrued income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 6,291 ¥ 6,554 $ 52,450Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,443 3,259 53,710Derivatives other than for trading assets . . . . . . . . . . . . . . . 21,845 16,502 182,107Deferred debenture issuance expenses . . . . . . . . . . . . . . . . 110 85 924Cash collateral paid for financial instruments . . . . . . . . . . . . 36,181 38,208 301,613Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,840 7,022 98,703
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 82,713 ¥ 71,633 $689,507
Other liabilities:Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 9,208 ¥ 10,286 $ 76,764Derivatives other than for trading liabilities . . . . . . . . . . . . . . 11,354 16,418 94,655Borrowed securities related to trading transactions . . . . . . . 16,936 51,845 141,187Matured debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,302 4,789 35,864Lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 574 651 4,785Asset retirement obligations . . . . . . . . . . . . . . . . . . . . . . . . 2,036 1,563 16,974Cash collateral received for financial instruments . . . . . . . . . 31,538 23,438 262,911Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,255 25,533 185,524
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥98,206 ¥134,527 $818,664
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17. EquityCapital Stock and Capital Surplus
Based on the resolution of the Board of Directors’ meetings
held on May 15 and 26, 2015, the Bank repurchased and
canceled all Class A Series 4 preferred stock and Class C
Series 5 preferred stock on June 29, 2015, for a lump-sum
payment of public funds. And based on the resolution of the
Board of Directors’ meeting held on May 15, 2015, the Bank
canceled a majority of treasury shares (common stock) on
June 29, 2015. As a result, there were changes in share-
holders’ equity for the first six months of FY2015, as below:
1. In this first six months of FY2015, the Bank repurchased
all Class A Series 4 preferred stock (24,072 thousand
shares) and Class C Series 5 preferred stock (214,579
thousand shares), for a lump-sum payment of public
funds, from the Deposit Insurance Corporation of
Japan and the Resolution and Collection Corporation,
respectively, in accordance with the Bank’s Articles of
Incorporation pursuant to Paragraph 1, Article 459 of the
Companies Act. This resulted in the increase in treasury
shares by 143,429 million yen. The Bank subsequently
canceled all the repurchased preferred stocks pursuant
to Article 178 of the Companies Act. As a result, capital
Changes in the number of issued shares of common stock, preferred stock and treasury stock of the six-month periods ended September 30, 2015 and 2014, consisted of the following:
Thousands
Number of shares
As of April 1, 2015 Increase Decrease
As of September 30, 2015
Issued stock Common stock Note 1 . . . . . . . . . . . . . . . . . . 1,650,147 — 467,253 1,182,894 Class A Series 4 preferred stock Note 3 . . . . . 24,072 — 24,072 — Class C Series 5 preferred stock Note 3 . . . . . 214,579 — 214,579 —
Treasury stock Common stock Note 1 483,753 0 467,253 16,500 Class A Series 4 preferred stock Notes 2, 3 . . . . — 24,072 24,072 — Class C Series 5 preferred stock Notes 2, 3 . . . . — 214,579 214,579 —
Thousands
Number of shares
As of April 1, 2014 Increase Decrease
As of September 30, 2014
Issued stock Common stock . . . . . . . . . . . . . . . . . . . . . . 1,650,147 — — 1,650,147 Class A Series 4 preferred stock . . . . . . . . . 24,072 — — 24,072 Class C Series 5 preferred stock . . . . . . . . . 214,579 — — 214,579
Treasury stock Common stock . . . . . . . . . . . . . . . . . . . . . . 483,753 — — 483,753
Notes: 1. The decrease is due to the cancellation of a majority of treasury shares (common stock) pursuant to Article 178 of the Companies Act. The increase is due to buybacks of shares constituting less than one trade unit.
2. The increase is due to the repurchase of all Class A Series 4 preferred stock and Class C Series 5 preferred stock, for a lump-sum repayment of public funds, from the Deposit Insurance Corporation of Japan and the Resolution and Collection Corporation, respectively, in accordance with the Bank’s Articles of Incorporation pursuant to Paragraph 1, Article 459 of the Companies Act.
3. The decrease is due to the cancellation of all the repurchased preferred stocks pursuant to Article 178 of the Companies Act.
surplus decreased by 143,429 million yen and treasury
shares decreased by the same amount.
2. In this first six months of FY2015, the Bank canceled
a majority of treasury shares (467,253 thousand shares
of common stock) pursuant to Article 178 of the
Companies Act. As a result, capital surplus decreased
by 95,945 million yen, and treasury shares decreased by
the same amount.
3. As other capital surplus became a negative amount after
the cancellation of treasury shares, the Bank netted out
the negative amount of other capital surplus against other
retained earnings, in accordance with ‘Accounting
Standard for Treasury Shares and Reduction of Legal
Reserves’ (ASBJ Statement No. 1, August 11, 2006). As
a result, capital surplus increased by 57,502 million yen
and retained earnings decreased by the same amount.
Authorized numbers of common shares was 3,304,746
thousand as of September 30 and authorized numbers of
common shares Class A Series 4 preferred shares and Class
C Series 5 preferred shares were 3,772,000 thousand,
24,072 thousand and 214,579 thousand as of March 31,
2015, respectively.
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Millions of Yen YenThousands ofU.S. Dollars U.S. Dollars
Total amounts Per share Total amounts Per share
September 30, 2015 (Record date: June 30, 2015) (Note 1)
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 4,665 ¥ 4.00 $ 38,892 $0.03 (Record date: March 31, 2015) (Note 2)
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 5,715 ¥ 4.90 $ 47,643 $0.04 Class A Series 4 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . 48 2.00 401 0.02 Class C Series 5 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . 319 1.488 2,661 0.01 Class C Series 5 preferred stock—super preferred dividends . . . . . 20,490 (Note 5) 170,806 (Note 5)
September 30, 2014 (Record date: June 30, 2014) (Note 3)
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 3,499 ¥ 3.00 Class A Series 4 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . 48 2.00 Class C Series 5 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . 319 1.488 (Record date: March 31, 2014) (Note 4)
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 5,248 ¥ 4.50 Class A Series 4 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . 54 2.25 Class C Series 5 preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . 359 1.674 Class C Series 5 preferred stock—super preferred dividends . . . . . 20,490 (Note 5)
Cash dividends
Cash dividends paid during the six-month periods ended September 30, 2015 and 2014, were as follows:
18. Stock OptionsExpenses for stock options as of September 30, 2015 and 2014, were as follows:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
General and administrative expenses . . . . . . . . . . . . . . . . . . . ¥100 ¥81 $839
The outline of stock options was as follows:
Stock options for FY2015 Stock options for FY2014
Title and number of eligible persons 4 directors of the Bank16 executive officers of the Bank
4 directors of the Bank
Number of stock options by share class (Note 1) 229,700 shares of common stock 253,500 shares of common stock
Grant date July 14, 2015 August 1, 2014
Condition for vesting None None
Requisite service period None None
Exercise period From July 15, 2014 to July 14, 2045 From August 2, 2014 to August 1, 2044
Exercise price (Note 2) ¥1 ($0.01) ¥1
Fair value on grant date (Note 2) ¥438 ($3.65) ¥323
Notes: 1. Shown in number of shares 2. Shown in per share
Subscription rights to sharesSubscription rights to shares as of September 30, 2015 and 2014, consisted of the following:
Millions of Yen U.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Subscription rights to shares as stock options . . . . . . . . . . . . ¥182 ¥81 $1,521
Notes: 1. Cash dividends applicable to the three-month period ended June 30, 2015 were approved at the Board of Directors’ meeting held on July 31, 2015. 2. Year-end cash dividends applicable to the fiscal year ended March 31, 2015 were approved at the Board of Directors’ meeting held on May 15, 2015. 3. Cash dividends applicable to the three-month period ended June 30, 2014 were approved at the Board of Directors’ meeting held on July 31, 2014. 4. Year-end cash dividends applicable to the fiscal year ended March 31, 2014 were approved at the Board of Directors’ meeting held on May 15, 2014. 5. Dividend per share is calculated by dividing total dividends of ¥20,490 million ($170,806 thousand) by 214,579 thousand shares of Class C Series 5
preferred stock as of the fiscal year end, which were paid from capital surplus. 6. Apart from ‘Class C Series 5 preferred stock—super preferred dividends’, the cash dividends were paid from retained earnings.
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19. Other Ordinary IncomeOther ordinary income for the six-month periods ended September 30, 2015 and 2014, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Gains on sales of bonds and other securities . . . . . . . . . . . . . . . . . . . . . . ¥ 4,846 ¥ 4,897 $ 40,403 Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,001 6,774 61,898 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥12,847 ¥11,671 $107,100
* The ‘Other’ category primarily includes gains from investments in partnerships.
20. Other IncomeOther income for the six-month periods ended September 30, 2015 and 2014, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Gains on sales of stocks and other securities . . . . . . . . . . . . . . . . . . . . . . . ¥ 81 ¥ 205 $ 675 Gains on investments in money held in trust . . . . . . . . . . . . . . . . . . . . . . . . 214 54 1,784 Recoveries of written-off claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,216 3,105 18,481 Reversal of allowance for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 4,375 — Reversal of provision for credit losses on off-balance-sheet instruments . . . — 579 — Gains on redemption of monetary claims bought . . . . . . . . . . . . . . . . . . . . — 2,606 — Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 654 1,150 5,457 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥3,166 ¥12,077 $26,397
21. Other Ordinary ExpensesOther ordinary expenses for the six-month periods ended September 30, 2015 and 2014, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Amortization of debenture issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 31 ¥ 14 $ 266 Losses on foreign exchange transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 1,491 137 12,430 Losses on sales of bonds and other securities . . . . . . . . . . . . . . . . . . . . . . 359 1,661 2,993 Losses on devaluation of bonds and other securities . . . . . . . . . . . . . . . . . 0 0 0 Losses on derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 23 446 Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700 938 5,840 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥2,636 ¥2,775 $21,975
* The ‘Other’ category primarily includes losses from investments in partnerships.
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22. General and Administrative Expenses General and administrative expenses for the six-month periods ended September 30, 2015 and 2014, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Salaries and related expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 8,372 ¥ 8,049 $ 69,791 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,691 10,166 89,125 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥19,063 ¥18,215 $158,916
23. Other ExpensesOther expenses for the six-month periods ended September 30, 2015 and 2014, consisted of the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Provision of allowance for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 43 ¥ — $ 361Provision of allowance for credit losses on off-balance-sheet instruments . . 247 — 2,067 Write-off of loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 167 334 Losses on disposal of noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . 2 2 19 Losses on reversal of foreign currency translation adjustment . . . . . . . . . . . — 5,741 — Other* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 592 1,850 4,942 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥926 ¥7,761 $7,723
* The ‘Other’ category primarily includes loss on reversal of foreign currency translation adjustment.
24. Lease TransactionsFinance lease transactions
The Group leases certain fixed assets, such as system-related equipment.
Operating lease transactions
The minimum rental commitments under non-cancelable operating leases as of September 30 and March 31, 2015, were as follows:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Due within one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥163 ¥144 $1,364 Due after one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130 186 1,090
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥294 ¥331 $2,454
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25. Financial Instruments and Related DisclosuresCarrying amounts, fair values and their differences of financial instruments as of September 30 and March 31, 2015 are shown
below. Immaterial accounts on the consolidated balance sheets are not included in the table below. Some instruments, such as
unlisted stocks, whose fair value cannot be reliably determined, are not included in the table below (see Note 2).
Millions of Yen Thousands of U.S. Dollars
Sep. 30, 2015 Sep. 30, 2015
CarryingAmount
Fair Value Difference
CarryingAmount
Fair Value Difference
Cash and due from banks . . . . . . . . . . . . . . . . ¥ 569,771 ¥ 569,751 ¥ (19) $ 4,749,680 $ 4,749,515 $ (165)
Call loans and bills bought . . . . . . . . . . . . . . . . 20,059 20,059 — 167,222 167,222 —
Receivables under securities borrowing transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 14,861 14,861 — 123,888 123,888 —
Monetary claims bought *1 . . . . . . . . . . . . . . . . 30,348 38,264 7,915 252,992 318,978 65,986
Trading assets
Trading securities . . . . . . . . . . . . . . . . . . . . . 61,709 61,709 — 514,416 514,416 —
Money held in trust . . . . . . . . . . . . . . . . . . . . . 13,871 16,050 2,178 115,633 133,796 18,163
Securities
Available-for-sale securities *2 . . . . . . . . . . . . 874,933 874,933 — 7,293,548 7,293,548 —
Loans and bills discounted . . . . . . . . . . . . . . . 2,610,391 21,760,516
Less allowance for loan losses *1 . . . . . . . . . (62,533) (521,283)
Net loans and bills discounted . . . . . . . . . . . . . 2,547,858 2,622,245 74,387 21,239,233 21,859,334 620,101
Assets total . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,133,415 ¥4,217,877 ¥84,461 $34,456,612 $35,160,697 $704,085
Deposits (excluding negotiable certificates of deposit) . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥2,738,021 ¥2,742,481 ¥ 4,459 $22,824,456 $22,861,634 $ 37,178
Negotiable certificates of deposit . . . . . . . . . . . 298,700 298,700 — 2,489,996 2,489,996 —
Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 241,384 (1) 2,012,222 2,012,206 (16)
Call money and bills sold . . . . . . . . . . . . . . . . . 137,499 137,499 — 1,146,213 1,146,213 —
Payables under securities lending transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 256,612 256,612 — 2,139,147 2,139,147 —
Borrowed money . . . . . . . . . . . . . . . . . . . . . . . 190,961 190,989 27 1,591,878 1,592,107 229
Bonds payable . . . . . . . . . . . . . . . . . . . . . . . . 10,000 10,000 — 83,361 83,361 —
Other liabilities
Borrowed securities related to trading transactions . . . . . . . . . . . . . . . . . . . . . . . . 16,936 16,936 — 141,188 141,188 —
Liabilities total . . . . . . . . . . . . . . . . . . . . . . . . . ¥3,890,118 ¥3,894,603 ¥ 4,485 $32,428,461 $36,843,624 $ 37,391
Derivatives *3
For which hedge accounting is not applied . . ¥ 25,641 ¥ 25,641 ¥ — $ 213,751 $ 213,751 $ —
For which hedge accounting is applied . . . . (10,256) (10,256) — (85,499) (85,499) —
Derivatives total . . . . . . . . . . . . . . . . . . . . . . . . ¥ 15,385 ¥ 15,385 ¥ — $ 128,252 $ 128,252 $ —
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Millions of Yen
Mar. 31, 2015
CarryingAmount
Fair Value Difference
Cash and due from banks . . . . . . . . . . . . . . . . ¥ 550,539 ¥ 550,528 ¥ (11)
Call loans and bills bought . . . . . . . . . . . . . . . . 20,000 20,000 —
Receivables under securities borrowing transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 58,889 58,889 —
Monetary claims bought *1 . . . . . . . . . . . . . . . . 30,859 37,884 7,025
Trading assets
Trading securities . . . . . . . . . . . . . . . . . . . . . 70,718 70,718 —
Money held in trust . . . . . . . . . . . . . . . . . . . . . . 23,635 25,940 2,305
Securities
Available-for-sale securities *2 . . . . . . . . . . . . 915,903 915,903 —
Loans and bills discounted . . . . . . . . . . . . . . . . 2,775,817
Less allowance for loan losses *1 . . . . . . . . . (62,554)
Net loans and bills discounted . . . . . . . . . . . . . 2,713,262 2,785,213 71,951
Assets total . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,383,807 ¥4,465,078 ¥81,270
Deposits (excluding negotiable certificates of deposit) . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥2,698,094 ¥2,702,178 ¥ 4,084
Negotiable certificates of deposit . . . . . . . . . . . 286,653 286,653 —
Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . 246,112 246,064 (48)
Call money and bills sold . . . . . . . . . . . . . . . . . 151,189 151,189 —
Payables under securities lending transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 293,020 293,020 —
Borrowed money . . . . . . . . . . . . . . . . . . . . . . . 187,236 187,033 (203)
Other liabilities
Borrowed securities related to trading transactions . . . . . . . . . . . . . . . . . . . . . . . . 51,845 51,845 —
Liabilities total . . . . . . . . . . . . . . . . . . . . . . . . . . ¥3,914,151 ¥3,917,984 ¥ 3,832
Derivatives *3
For which hedge accounting is not applied . . ¥ 15,185 ¥ 15,185 ¥ —
For which hedge accounting is applied . . . . . (49,972) (49,972) —
Derivatives total . . . . . . . . . . . . . . . . . . . . . . . . ¥ (34,787) ¥ (34,787) ¥ —
*1 General allowance for loan losses and specific allowance for loan losses provided to ‘Loans and bills discounted’ are separately presented in the above table. Allowance for loan losses provided to ‘Monetary claims bought’ is directly deducted from the carrying amounts due to immateriality.
*2 Carrying amounts, fair values and their differences of available-for-sale securities do not include those of certain investments in partnerships of which com-posing assets consist of monetary claims etc., whose fair value is determinable. As for such investments in partnerships, the carrying amounts were ¥12,177 million ($101,511 thousand) and ¥12,271 million, and the fair value was ¥15,499 million ($129,202 thousand) and ¥15,568 million, which was our share of the fair value of composing assets such as monetary claims determined by the present value of estimated future cash flows or estimated collectable amount by collaterals or guarantees as of September 30 and March 31, 2015, respectively. The difference between the fair value and the carrying amounts was ¥3,321 million ($27,691 thousand) and ¥3,297 million, as of September 30 and March 31, 2015, respectively.
*3 Derivatives recorded in ‘Trading assets,’ ‘Trading liabilities,’ ‘Other assets’ and ‘Other liabilities’ are aggregated and shown herein in total. Assets and liabilities attributable to the derivative contracts are totally offset and the net liability position as a consequence of offsetting would be represented with brackets, if any.
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(Note 1) Valuation method of financial instruments
Assets
(1) Cash and due from banks, call loans and bills bought,
and receivables under securities borrowing transactions
Since these instruments are paid on demand, or cancelable
by short notice, or with short maturities, the fair value of
these instruments approximates the carrying amount.
Therefore, the carrying amount of these instruments is
deemed as the fair value. Some due from banks are valued at
prices provided by vendor financial institutions, etc.
(2) Monetary claims bought
Fair value of trust beneficiary rights, recorded as monetary
claims bought, which meet the criteria of securities for the
purpose of accounting treatment, is measured using the
same method as described in (5) Securities, below.
The fair value of monetary claims bought other than the
above is calculated using the same method as described in
(6) Loans and bills discounted, below.
(3) Trading assets
Fair value of trading securities, mainly bonds, is determined
using market prices quoted at exchanges or market prices
announced by certain industry associations or provided by
information vendors.
(4) Money held in trust
Securities held in trust on behalf of the Group are valued
using the same method as described in (5) Securities, below.
Monetary claims held in trust on behalf of the Group are
calculated using the same method as described in (6) Loans
and bills discounted, below.
(5) Securities
Stocks are valued at market prices quoted at exchanges.
Bonds that have a market price announced by certain
industry associations or provided by information vendors are
valued at those prices, in principle. Bonds that do not have
a market price announced by certain industry associations
or provided by information vendors are calculated using the
same method as described in (6) Loans and bills discounted,
below, or valued at a price provided by the brokers or deal-
ers. Investment trust funds are valued at a price provided by
the management company of each fund. Investments in part-
nerships are valued in accordance with the above method or
using the same method as described in (6) Loans and bills
discounted, below, depending on the type of assets which
are held by the partnership.
(6) Loans and bills discounted
Fair value of loans and bills discounted is determined as the
present value of estimated future cash flows, discounted
by the market interest rates, less accrued interest. The
estimated future cash flows are calculated by adjusting con-
tractual payments of principal and interest with credit and
other risks, which are reflected mainly through PD and LGD.
PD is based on the internal credit ratings and LGD is based
on the situations of underlying assets and collateral. Some
loans and bills discounted are valued at prices provided by
vendor financial institutions, etc. Concerning compound
financial instruments to which bifurcation accounting is
applied, the contractual payments of principal and interest
for the calculations are those of the host contracts where
embedded derivatives are bifurcated under bifurcation
accounting.
As for loans to ‘Bankrupt’ borrowers, ‘De facto bankrupt’
borrowers and ‘In danger of bankruptcy’ borrowers, the
collectible amount through the disposal of collateral or the
execution of guarantees, or the present value of estimated
future cash flows, etc., is deemed as the fair value.
As for loans with no maturity due to the feature that the
amount of loans is limited within the collateral amount, and
immaterial loans without concerns about collectability, the
carrying amount is deemed as the fair value.
Liabilities
(1) Deposits (excluding negotiable certificates of deposit)
Fair value of deposits on demand is deemed as the payment
amount payable if demanded on the consolidated balance
sheet date, i.e., ‘carrying amount.’ Fair value of time
deposits is determined as the present value of contractual
payments of principal and interest less accrued interest.
The discount rate is the market interest rate, adjusted with
average funding spreads of the Bank observed within a
specified period preceding the consolidated balance sheet
date. Concerning compound financial instruments to which
bifurcation accounting is applied, contractual payments of
principal and interest for the calculations are those of the
host contracts where embedded derivatives are bifurcated
under bifurcation accounting.
(2) Negotiable certificates of deposit
Since the contract period is short, fair value approximates the
carrying amount. Therefore, the carrying amount is deemed
as the fair value.
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(3) Debentures
Debentures that have a market price announced by certain
industry associations or provided by information vendors are
valued at those prices. As for debentures that do not have
a market price announced by certain industry associations
or provided by information vendors, the fair value of those
with short maturities approximates the carrying amount.
Therefore, the carrying amount is deemed as the fair value.
On the other hand, the fair value of debentures other than
those above is calculated using the same method as for time
deposits described in (1) Deposits above.
(4) Call money and bills sold, and payables under securities
lending transactions
Since the contract period is short, fair value approximates the
carrying amount. Therefore, the carrying amount is deemed
as the fair value.
(5) Borrowed money
Fair value of other borrowed money is calculated using the
same method as for time deposits described in (1) Deposits
above. Concerning the compound financial instruments
to which bifurcation accounting is applied, the contractual
payments of principal and interest for the calculations are
those of the host contracts where embedded derivatives are
bifurcated under bifurcation accounting.
(6) Bonds payable
Fair value is based on the market price announced by certain
industry associations or provided by information vendors.
(7) Other liabilities
Fair value of borrowed securities related to trading transac-
tions is based on the market price announced by certain
industry associations or provided by information vendors.
Derivatives
The valuation method of derivatives is described in the
footnotes to the respective tables in Note 26, ‘Derivatives.’
(Note 2) Financial instruments whose fair value cannot be reliably determined
The following instruments are not included in ‘Securities’ in Asset in the above table showing fair value of financial instruments.
Carrying amount Sep. 30, 2015
Millions of YenThousands ofU.S. Dollars
(1) Unlisted stocks, etc.*1 *3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 5,896 $ 49,156
(2) Investments in partnerships *2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56,573 471,599
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥62,469 $520,755
Carrying amount Mar. 31, 2015
Millions of Yen
(1) Unlisted stocks, etc.*1 *3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 3,144
(2) Investments in partnerships *2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,741
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥55,885
*1 Fair value of unlisted stocks, etc., is not disclosed because they do not have a market price and their fair value cannot be reliably determined.*2 Fair value of investments in partnerships, composed of assets whose fair value cannot be reliably determined, such as unlisted stocks, is not disclosed.*3 No unlisted stocks were written off for the six-month period ended September 30, 2015. The Group wrote off unlisted stocks, etc., by 0 million yen for the year
ended March 31, 2015.
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26. Derivatives
a. Derivative transactions for which hedge accounting is not applied
The Group had the following derivative contracts, which were listed on exchanges, outstanding as of September 30 and March 31, 2015:
Millions of Yen Thousands of U.S. Dollars
Contract or Notional Amount Fair Value
Valuation Gain/(Loss)
Contract or Notional Amount Fair Value
Valuation Gain/(Loss)
September 30, 2015
Interest rate contracts:
Futures sold . . . . . . . . . . . . . . . . . ¥ 4,446 ¥ (16) ¥ (16) $ 37,071 $ (139) $ (139)
Futures bought . . . . . . . . . . . . . . . 4,446 4 4 37,066 39 39
Bond contracts:
Futures sold . . . . . . . . . . . . . . . . . 19,815 0 0 165,182 4 4
Futures bought . . . . . . . . . . . . . . . 7,400 8 8 61,687 67 67
Futures options written . . . . . . . . . 4,000 (3) 0 33,344 (29) 5
Futures options purchased . . . . . . 21,395 19 (11) 178,353 162 (92)
Equity contracts:
Index futures sold . . . . . . . . . . . . . 1,629 (3) (3) 13,585 (26) (26)
Index futures bought . . . . . . . . . . . 4,513 (78) (78) 37,623 (657) (657)
Index options written . . . . . . . . . . . 68,438 (754) (367) 570,513 (6,289) (3,063)
Index options purchased . . . . . . . . 76,233 732 63 635,495 6,109 528
March 31, 2015
Bond contracts:
Futures sold . . . . . . . . . . . . . . . . . ¥12,165 ¥ 17 ¥ 17
Futures bought . . . . . . . . . . . . . . . 5,250 (14) (14)
Futures options written . . . . . . . . . 19,000 (34) 4
Futures options purchased . . . . . . 1,000 6 3
Equity contracts:
Index futures sold . . . . . . . . . . . . . 689 2 2
Index futures bought . . . . . . . . . . . 2,802 (22) (22)
Index options written . . . . . . . . . . . 17,777 (38) 19
Index options purchased . . . . . . . . 11,817 83 (46)
Notes: 1. The contracts or notional amounts of derivatives which are shown in the above table do not necessarily represent the amounts exchanged by the parties and do not measure the exposure of the Group to credit or market risk.
2. Derivative transactions shown above are stated at fair value in the accompanying consolidated financial statements. 3. Fair values of the above derivatives are based on quoted market prices, such as those from the Tokyo Financial Exchange, Inc. or the Osaka
Exchange, Inc.
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The Group had the following derivative contracts, which were not listed on exchanges, outstanding as of September 30 and March 31, 2015:
Millions of Yen Thousands of U.S. Dollars
Contract or Notional Amount Fair Value
Valuation Gain/(Loss)
Contract or Notional Amount Fair Value
Valuation Gain/(Loss)
September 30, 2015Interest rate contracts: Interest rate swaps: Receive fixed and pay floating . . . . ¥10,938,390 ¥ 207,787 ¥ 207,787 $91,183,645 $ 1,732,144 $ 1,732,144 Receive floating and pay fixed . . . . 10,469,031 (183,178) (183,178) 87,271,019 (1,526,993) (1,526,993) Receive floating and pay floating . . 625,483 1,267 1,267 5,214,102 10,563 10,563 Other contracts sold . . . . . . . . . . . . . 1,267,775 (10,469) (10,469) 10,568,317 (87,271) (87,271) Other contracts bought . . . . . . . . . . . 604,919 528 528 5,042,677 4,408 4,408 Foreign exchange contracts: Currency swaps . . . . . . . . . . . . . . . . 635,861 (444) (444) 5,300,616 (3,702) (3,702) Forward exchange contracts sold . . . 729,372 8,194 8,194 6,080,134 68,307 68,307 Forward exchange contracts bought 151,366 6,143 6,143 1,261,805 51,213 51,213 Options written . . . . . . . . . . . . . . . . . 204,273 (7,794) (1,049) 1,702,851 (64,979) (8,746) Options purchased . . . . . . . . . . . . . . 200,625 3,387 (899) 1,672,437 28,237 (7,496)Commodity derivatives: Commodity swaps: Receive fixed and pay floating . . . . 27,067 8,739 8,739 225,638 72,851 72,851 Receive floating and pay fixed . . . . 26,912 (8,599) (8,599) 224,348 (71,687) (71,687) Receive floating and pay floating . . 185 0 0 1,549 1 1 Options written . . . . . . . . . . . . . . . 14,345 (54) (54) 119,583 (456) (456) Options purchased . . . . . . . . . . . . 14,345 54 54 119,583 456 456 Credit derivatives: CDS sold . . . . . . . . . . . . . . . . . . . . . 122,505 1,358 1,358 1,021,217 11,321 11,321 CDS bought . . . . . . . . . . . . . . . . . . . 122,285 (1,390) (1,390) 1,019,383 (11,590) (11,590)Internal transactions Interest rate swaps: Receive floating and pay fixed . . . . 93,000 (241) (241) 775,258 (2,017) (2,017) Currency swaps . . . . . . . . . . . . . . . . 613,066 361 361 5,110,587 3,017 3,017
March 31, 2015Interest rate contracts: Interest rate swaps: Receive fixed and pay floating . . . . ¥12,340,177 ¥ 251,786 ¥ 251,786 Receive floating and pay fixed . . . . 11,796,592 (229,522) (229,522) Receive floating and pay floating . . 611,902 934 934 Other contracts sold . . . . . . . . . . . . . 1,204,396 (8,033) (8,033) Other contracts bought . . . . . . . . . . . 396,337 655 655 Foreign exchange contracts: Currency swaps . . . . . . . . . . . . . . . . 600,825 (350) (350) Forward exchange contracts sold . . . 608,955 (3,155) (3,155) Forward exchange contracts bought 134,745 7,919 7,919 Options written . . . . . . . . . . . . . . . . . 153,400 (8,376) (2,985) Options purchased . . . . . . . . . . . . . . 119,295 3,287 (0)Commodity derivatives: Commodity swaps: Receive fixed and pay floating . . . . 32,800 9,127 9,127 Receive floating and pay fixed . . . . 32,675 (9,020) (9,020) Receive floating and pay floating . . 426 0 0 Options written . . . . . . . . . . . . . . . 20,001 (378) (378) Options purchased . . . . . . . . . . . . 20,001 378 378 Credit derivatives: CDS sold . . . . . . . . . . . . . . . . . . . . . 112,286 1,949 1,949 CDS bought . . . . . . . . . . . . . . . . . . . 111,316 (1,908) (1,908)Internal transactions Interest rate swaps: Receive floating and pay fixed . . . . 116,000 (371) (371) Currency swaps . . . . . . . . . . . . . . . . 538,376 159 159
Notes: 1. The contracts or notional amounts of derivatives which are shown in the above table do not necessarily represent the amounts exchanged by the parties and do not measure the exposure of the Group to credit or market risk.
2. Derivative transactions shown above are stated at fair value in the accompanying consolidated financial statements. 3. The calculation or quotation of the fair value of the above derivatives are based on the discounted present value method or option pricing models, etc. 4. ‘Sold’ credit derivatives represent credit risk taking. ‘Bought’ credit derivatives represent credit risk transfer. 5. Foreign exchange profit/loss generated from currency exposure with the final principal settlement of currency swaps, amounting to a gain of ¥82
million ($681 thousand) and a gain of ¥104 million as of September 30 and March 31, 2015, respectively, are excluded from ‘Fair Value’ and ‘Valuation Gain/(Loss)’ shown above.
6. Other contracts sold and bought of ‘Interest rate contracts’ were mainly swaptions. 7. CDS is the abbreviation for credit default swaps. 8. Commodity derivatives are mainly related to oil and non-ferrous metal.
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b. Derivative transactions for which hedge accounting is applied
The Group had the following derivative contracts for which hedge accounting is applied as of September 30 and March 31, 2015:
Millions of Yen Thousands of U.S. Dollars
Contract or Notional Amount Fair Value
Contract or Notional Amount Fair Value
September 30, 2015Equity contract:
Index future . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 13,199 ¥ 269 $ 110,032 $ 2,250 Total return swap . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,435 290 203,693 2,423
Interest rate contracts:Interest rate swaps:
Receive fixed and pay floating . . . . . . . . . . . . . . . . . . . . . . . . . . 93,000 241 775,258 2,017 Foreign exchange contracts:
Currency swaps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 623,792 (361) 5,200,000 (3,017)
March 31, 2015Equity contract:
Total return swap . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 26,055 ¥ 409 Interest rate contracts:
Interest rate swaps:Receive fixed and pay floating . . . . . . . . . . . . . . . . . . . . . . . . . . 116,000 371
Foreign exchange contracts:Currency swaps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 589,078 (159)
27. Per Share InformationThe reconciliation of the differences between basic and diluted net income per share (EPS) for the six-month periods ended
September 30, 2015 and 2014, was as follows:
Millions of YenThousands of
Shares Yen U.S. Dollars
Net Income Attributable to
Owners of ParentWeighted-Average Number of Shares EPS
Six-month period ended September 30, 2015Basic EPS—Net income available to common stockholders (Net income attributable to owners of parent less preferred dividends other than super preferred dividends) . . . . . . . . . . ¥24,297 1,166,394 ¥20.83 $0.18Effect of dilutive securities—Preferred stocks and Subscription rights to shares . . . . . . . . . . . . . . . . . . . . . — 198,047
Diluted EPS—Net income for computation and subscription rights to shares . . . . . . . . . . . . . . . . . . . . . ¥24,297 1,364,441 ¥17.80 $0.14
Six-month period ended September 30, 2014Basic EPS—Net income available to common stockholders (Net income attributable to owners of parent less preferred dividends other than super preferred dividends) . . . . . . . . . . ¥22,919 1,166,394 ¥19.65 Effect of dilutive securities—Preferred stocks . . . . . . . . . . . . . 734 406,549
Diluted EPS—Net income for computation and subscription rights to shares . . . . . . . . . . . . . . . . . . . . . ¥23,654 1,572,859 ¥15.03
Notes: 1. The contracts or notional amounts of derivatives which are shown in the above table do not necessarily represent the amounts exchanged by the parties and do not measure the exposure of the Group to credit or market risk.
2. The calculation or quotation of the fair value of the above derivatives are based on the discounted present value method, etc. 3. For the interest rate swaps shown above, deferred hedge accounting is applied in accordance with the JICPA Industry Audit Committee Report No. 24. 4. For the currency swaps shown above, deferred hedge accounting is applied in accordance with the JICPA Industry Audit Committee Report No. 25. 5. The main hedged items for interest rate swaps are interest-bearing financial liabilities such as deposits and debentures. 6. The main hedged items for currency swaps are foreign-currency-denominated financial assets or liabilities such as loans and securities. 7. Foreign exchange profit/loss generated from currency exposure with the final principal settlement of currency swaps, amounting to a loss of ¥10,697
million ($89,171 thousand) and a loss of ¥50,594 million as of September 30 and March 31, 2015, respectively, are excluded from ‘Fair Value’ shown above.
8. All of the contracts shown above are internal transactions.
Net assets per share of common stock as of September 30 and March 31, 2015, were as follows:
Yen U.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Net assets per share of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥342.33 ¥336.83 $2.85
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28. Segment Information1. Segment information
Segment information for the six-month periods ended September 30, 2015 and 2014 was as follows:
sale of financial products, financing through securitization,
privately placed bonds and M&A advisory.
SBG offers financial services that require specialized
expertise such as corporate restructuring finance, real estate
finance and overseas loans and investments.
FMG engages in offering derivatives and foreign exchange
products to customers, trading derivatives and foreign
exchange products, as well as ALM operations.
(2) Methods of measurement for the amounts of
revenues, profit (loss), assets and liabilities by
reportable segments
Revenues, profit (loss), assets and liabilities of reportable
segments are recognized and measured based on substan-
tially the same accounting policies as those described in
2. Summary of Significant Accounting Policies.
The Bank calculates its net interest income from funding
and investing across reportable segments based on i) the
internal transfer rates determined by the average rate of
funding by the currency and by contractual term, and ii) the
allocation ratio determined by the Bank based on the value of
compensation for funding activities.
Fixed assets are not allocated to reportable segments, while
the associated expenses are allocated to specific reportable
segments and included in the segments’ expenses.
Net assets per share of common stock as of September 30 and March 31, 2015, were calculated based on the following:
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015 Mar. 31, 2015 Sep. 30, 2015
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥400,251 ¥567,414 $3,336,541 Deductions from total equity: Non-controlling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 769 767 6,412 Preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 152,819 — Preferred dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 20,857 — Subscription rights to shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182 81 1,521
Net assets attributable to common stock at the end of the period . . . . . . . ¥399,299 ¥392,887 $3,328,608
Number of shares of common stock at the end of the period used for the calculation of net assets per share of common stock (shares in thousands). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,166,394 1,166,394
The Bank had entered into ‘the Agreement on the
Treatment of Preferred Stock as Public Funds’ (dated
September 27, 2012) with the Deposit Insurance
Corporation of Japan, which includes a mutual confirmation
that the total amount of public funds to be paid should be
227.6 billion yen. However, for the calculation of the net
assets per share for the fiscal year ended March 31, 2015,
the net assets as of the balance sheet date attributable to
the common shareholders are based on the net assets less
the amounts of the preferred stocks, which are calculated
by multiplying the per share paid-in amount (1,000 yen
per 4th preferred share and 600 yen per 5th preferred
share) by the number of shares issued. Therefore, the total
amount of public funds to be repaid and those accumulated
repayments as of March 31, 2015, are not reflected in the
calculation.
(1) Description of reportable segments
(a) Identification of operating segments
The Bank has classified its Group’s business operations into
business groups based upon the nature of the customers
served and products offered: Retail Banking Group (‘RBG’),
Institutional Banking Group (‘IBG’), Specialized Banking
Group (‘SBG’), and Financial Markets Group (‘FMG’).
Financial information for these groups is regularly reported
to the Management Committee, which comprises members
from amongst the Executive Officers who are approved and
appointed by the Board of Directors, and is utilized for man-
agement decisions on the allocation of resources, evaluation
of the performance of each business group, and so on.
The Bank has designated these business groups as operat-
ing segments and reportable segments for the purpose of the
disclosures contained herein.
(b) Services provided by each reportable segment
RBG offers financial services to retail customers. RBG’s major
services are the sale of investment products, including
deposits, investment trusts and insurance, and other financial
services.
IBG offers financial services to corporate customers, public
sector customers and financial institutions. Major services
offered by IBG are loans and deposits, acquisition finance,
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Millions of Yen
RBG IBG SBG FMG Total
Consolidated net revenue . . . . . . . . . . . . . . ¥ 5,945 ¥ 12,976 ¥ 17,530 ¥ 9,962 ¥ 46,414
General and administrative expenses . . . . . 3,630 7,245 6,648 1,883 19,407
Segment profit . . . . . . . . . . . . . . . . . . . . . . 2,315 5,730 10,881 8,078 27,006
Segment assets . . . . . . . . . . . . . . . . . . . . . 14,711 1,258,339 1,606,468 1,662,615 4,542,133
Segment liabilities . . . . . . . . . . . . . . . . . . . . 2,022,626 1,365,960 71,664 680,345 4,140,595
Millions of Yen
RBG IBG SBG FMG Total
Consolidated net revenue . . . . . . . . . . . . . . ¥ 6,766 ¥ 11,569 ¥ 17,347 ¥ 10,445 ¥ 46,128
General and administrative expenses . . . . . 3,433 7,420 6,354 1,758 18,966
Segment profit . . . . . . . . . . . . . . . . . . . . . . 3,333 4,148 10,992 8,686 27,161
Segment assets . . . . . . . . . . . . . . . . . . . . . 9,229 1,432,754 1,452,999 2,021,792 4,916,774
Segment liabilities . . . . . . . . . . . . . . . . . . . . 2,047,819 1,331,764 75,052 945,595 4,400,230
(3) Revenues, profit (loss), assets and liabilities by reportable segment
Thousands of U.S. Dollars
RBG IBG SBG FMG Total
Consolidated net revenue . . . . . . . . . . . . . . $ 49,566 $ 108,172 $ 146,134 $ 83,047 $ 386,918
General and administrative expenses . . . . . 30,264 60,399 55,422 15,702 161,786
Segment profit . . . . . . . . . . . . . . . . . . . . . . 19,302 47,773 90,712 67,345 225,132
Segment assets . . . . . . . . . . . . . . . . . . . . . 122,633 10,489,655 13,391,697 13,859,745 37,863,730
Segment liabilities . . . . . . . . . . . . . . . . . . . . 16,860,837 11,386,796 597,399 5,671,432 34,516,464
Notes: 1. Due to the nature of the banking business, the Bank uses ‘consolidated net revenue’ as a substitute for ‘sales’ as would be used by non-financial service companies. Consolidated net revenue represents the total of net interest income, net fees and commissions, net trading income and net other ordinary income. The Bank oversees its revenue by reportable segment using consolidated net revenue. The Bank offsets interest income and interest expense for the management purposes, therefore, revenue in transactions between reportable segments is not disclosed.
2. Depreciation expenses are included in the general and administrative expenses of each reportable segment but are not disclosed as a separate item, because in the calculation process of the segment profit (loss), a part of depreciation expenses is allocated to each reportable segment, aggregated with other general and administrative expenses. Therefore, depreciation expenses by reportable segment are not managed separately. The amount of depreciation expense for this period is ¥1,167 million.
Six-month period ended September 30, 2015
Six-month period ended September 30, 2014
Notes: 1. Due to the nature of the banking business, the Bank uses ‘consolidated net revenue’ as a substitute for ‘sales’ as would be used by non-financial service companies. Consolidated net revenue represents the total of net interest income, net fees and commissions, net trading income and net other ordinary income. The Bank oversees its revenue by reportable segment using consolidated net revenue. The Bank offsets interest income and interest expense for the management purposes, therefore, revenue in transactions between reportable segments is not disclosed.
2. Depreciation expenses are included in the general and administrative expenses of each reportable segment but are not disclosed as a separate item, because in the calculation process of the segment profit (loss), a part of depreciation expenses is allocated to each reportable segment, aggregated with other general and administrative expenses. Therefore, depreciation expenses by reportable segment are not managed separately. The amount of depreciation expense for this period is ¥1,625 million ($13,554 thousand).
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Millions of YenThousands of U.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Total consolidated net revenue of reportable segments . . . . . . . . . . . . . . . . . . . . . ¥46,414 ¥46,128 $386,918 Variances resulting from differences in the basis of revenue and expense recognition and measurement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 52 678
Net revenue derived from the consolidated semiannual statement of income . . . . . ¥46,496 ¥46,180 $387,596
(4) Reconciliation between total segment amounts and the consolidated semiannual financial statements
(a) Reconciliation between total consolidated net revenue of reportable segments and the consolidated net revenue in the consolidated
semiannual financial statement of income for the six-month periods ended September 30, 2015 and 2014, were as follows:
Millions of YenThousands of U.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Total segment profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥27,006 ¥27,161 $225,132 Variances resulting from differences in the basis of revenue and expenses recognition and measurement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (384) 98 (3,207)Amortization of actuarial differences on retirement benefit plans, etc. . . . . . . . . . . . 810 705 6,755 Credit-related expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,834 10,546 15,290 Gains (losses) on stock transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 205 675 Others, including net extraordinary income (losses) . . . . . . . . . . . . . . . . . . . . . . . . 325 (6,437) 2,709
Income before income taxes in the consolidated semiannual statement of income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥29,672 ¥32,280 $247,354
(b) Reconciliation between total segment profits and the consolidated semiannual statement of income for the six-month periods
ended September 30, 2015 and 2014, were as follows:
Note: Credit-related expenses, etc., represent the total of write-offs of loans, provision of allowance for loan losses and losses on disposition of non-performing loans.
Millions of YenThousands of U.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Total segment assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,542,133 ¥4,916,774 $37,863,730 Allowance for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (63,450) (60,560) (528,932)Assets not allocated to reportable segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159,650 187,239 1,330,860
Total assets on the consolidated semiannual balance sheet . . . . . . . . . . . . . . . . . . ¥4,638,332 ¥5,043,453 $38,665,658
Millions of YenThousands of U.S. Dollars
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2015
Total segment liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,140,595 ¥4,400,230 $34,516,464 Liabilities not allocated to reportable segments . . . . . . . . . . . . . . . . . . . . . . . . . . . 97,485 123,530 812,653
Total liabilities on the consolidated semiannual balance sheet . . . . . . . . . . . . . . . . ¥4,238,080 ¥4,523,760 $35,329,117
(c) Reconciliation between total segment assets and total assets on the consolidated semiannual balance sheet as of
September 30, 2015 and 2014, were as follows:
(d) Reconciliation between total segment liabilities and total liabilities on the consolidated semiannual balance sheet as of
September 30, 2015 and 2014, were as follows:
Note: As for the year ended September 30, 2015, assets not allocated to reportable segments include foreign exchange of ¥24,972 million ($208,172 thousand), other assets of ¥60,756 million ($506,476 thousand), fixed assets of ¥31,669 million ($264,000 thousand) and deferred tax assets of ¥25,276 million ($210,709 thousand). As for the year ended September 30, 2014, assets not allocated to reportable segments include foreign exchange of ¥26,178 million, other assets of ¥80,399 million, fixed assets of ¥26,629 million and deferred tax assets of ¥35,600 million.
Note: As of September 30, 2015, liabilities not allocated to reportable segments include other liabilities of ¥85,008 million ($708,638 thousand) and net defined benefit liability of ¥7,910 million ($65,941 thousand). As of September 30, 2014, liabilities not allocated to reportable segments include other liabilities of ¥110,856 million and net defined benefit liability of ¥7,876 million.
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2. Related information
For the six-month period ended September 30, 2014
Millions of Yen
Securities Derivatives, Lending investment etc. Others Total
Ordinary income from external customers . . . . . . . . . . . . . . . ¥26,388 ¥20,155 ¥4,144 ¥9,553 ¥60,242
Millions of Yen
Securities Derivatives, Lending investment etc. Others Total
Ordinary income from external customers . . . . . . . . . . . . . . . ¥33,223 ¥16,684 ¥5,323 ¥13,006 ¥68,237
Thousands of U.S. Dollars
Securities Derivatives, Lending investment etc. Others Total
Ordinary income from external customers . . . . . . . . . . . . . . . $219,978 $168,019 $34,551 $79,641 $502,189
Note: Ordinary income is presented instead of sales as would be used by non-financial service companies.
(2) Segment information by geographic region
(a) Ordinary income
The information by geographic region has been omitted as the transaction data on each customer regarding interest income, gains
on sales of securities and income related to derivative transactions, etc., were not available to be segmented by customers’ domicile.
(b) Tangible fixed assets
The information by geographic region has been omitted as the amounts of tangible fixed assets located in Japan exceeded 90% of
the total amount of tangible fixed assets in the consolidated semiannual balance sheets as of September 30, 2015 and 2014.
(3) Segment information by major customer
The information by major customer has been omitted as ordinary income from any particular customer was less than 10% of ordinary
income in the consolidated semiannual statement of income.
3. Segment information on impairment losses on fixed assets by reportable segment
Not applicable.
4. Segment information on amortization and unamortized portion of goodwill by reportable segment
Not applicable.
5. Segment information on profit on negative goodwill by reportable segment
Not applicable.
(1) Segment information by service
For the six-month period ended September 30, 2015
29. Subsequent EventsAppropriation of Retained Earnings
The following distribution of retained earnings to the stockholders of record as of September 30, 2015 was approved at the
Board of Directors’ meeting held on November 12, 2015:
Millions of YenThousands of U.S. Dollars
Dividends for the three-month period ended September 30, 2015:Common stock, ¥4.00 ($0.03) per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,665 $38,892
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,665 $38,892
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Interest-Earning Assets and Interest-Bearing LiabilitiesFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(Millions of Yen, %)
Average balance Interest income/expenses Return/rates
Sep. 2015 Sep. 2014 Mar. 2015 Sep. 2015 Sep. 2014 Mar. 2015 Sep. 2015 Sep. 2014 Mar. 2015
Interest-earning assets . . . . . 3,948,397 4,027,226 4,072,684 32,541 30,984 63,398 1.64 1.53 1.55 Due from banks . . . . . . . . . 62,293 47,237 50,274 46 27 59 0.14 0.11 0.11 Call loans and bills bought . 20,306 22,250 21,501 13 16 31 0.13 0.15 0.14 Receivables under securities borrowing transactions . . . 24,115 35,771 45,625 4 6 15 0.03 0.03 0.03 Securities . . . . . . . . . . . . . . 1,021,173 1,253,488 1,212,747 9,557 9,202 17,685 1.86 1.46 1.45 Loans and bills discounted . 2,720,217 2,613,821 2,673,686 21,785 20,919 42,935 1.59 1.59 1.60
Interest-bearing liabilities . . . 3,989,683 3,904,600 3,919,279 7,137 6,705 13,406 0.35 0.34 0.34 Deposits . . . . . . . . . . . . . . . 2,764,618 2,721,162 2,720,031 4,066 4,701 9,014 0.29 0.34 0.33 Negotiable certificates of deposit . . . . . . . . . . . . . . . 324,756 262,562 277,030 170 152 306 0.10 0.11 0.11 Debentures . . . . . . . . . . . . . 247,151 203,261 216,055 308 271 562 0.24 0.26 0.26 Call money and bills sold . . . 166,660 165,707 177,909 238 178 417 0.28 0.21 0.23 Payables under securities lending transactions . . . . . 276,389 321,675 325,064 352 297 595 0.25 0.18 0.18 Borrowed money . . . . . . . . 190,174 189,161 182,795 430 363 745 0.45 0.38 0.40 Bonds payable . . . . . . . . . . 1,092 — — 1 — — 0.20 — —
Note: Interest expenses are shown after deduction of amounts of assumed cost of funding money held in trust (¥7 million for the six-month period ended September 30, 2015, ¥4 million for the six-month period ended September 30, 2014, and ¥10 million for the year ended March 31, 2015).
Fees and Commissions For the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Net fees and commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,766 7,541 14,547 Fees and commissions income . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,246 8,035 15,606
Deposits, debentures and loan operations . . . . . . . . . . . . . . . . . . . . 2,524 4,180 7,159 Foreign exchange operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 86 171 Securities-related operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,386 1,161 2,782 Agency services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,567 2,102 4,151 Safekeeping and safe deposit box services . . . . . . . . . . . . . . . . . . . — 0 0 Guarantee operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 73 152
Fees and commissions expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . 480 493 1,059 Foreign exchange operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 51 104
Other Ordinary IncomeFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Net other ordinary income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,211 8,896 15,826 Other ordinary income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,847 11,671 26,571
Gains on foreign exchange transactions . . . . . . . . . . . . . . . . . . . . . . . — — 677 Gains on sales of bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,846 4,897 11,088 Gains on redemption of bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Gains on derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,001 6,774 14,805
Other ordinary expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,636 2,775 10,745 Loss on foreign exchange transactions . . . . . . . . . . . . . . . . . . . . . . . . 1,491 137 —Loss on sales of bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 359 1,661 8,230 Loss on redemption of bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Loss on devaluation of bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 Amortization of debenture and corporate bonds issurance expenses . 31 14 45 Loss on derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 23 14 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700 938 2,454
Trading RevenuesFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Net trading revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,121 5,468 12,479 Trading income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,440 5,468 12,479
Gains on trading account securities transactions . . . . . . . . . . . . . . . . . 1,448 440 2,359 Income from securities and derivatives related to trading transactions . — 270 883 Income from trading-related financial derivatives transactions . . . . . . . 3,991 4,758 9,236 Other trading income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 0
Trading expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318 — —Expenses on trading securities and derivatives . . . . . . . . . . . . . . . . . . — — —Expenses on securities and derivatives related to trading transactions . 318 — —Expenses on trading-related financial derivatives transactions . . . . . . . — — —Other trading expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —
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046
Financial and C
orporate Data
Non-C
onsolidated Business R
esults
Non-Consolidated Business Results
Non-Consolidated Financial HighlightsFor the six-month periods ended September 30, 2015, 2014 and 2013, and the years ended March 31, 2015 and 2014
(Millions of Yen)
Sep. 30, 2015 Sep. 30, 2014 Sep. 30, 2013 Mar. 31, 2015 Mar. 31, 2014
Ordinary income . . . . . . . . . . . . . . . . . . . . . . . . . . . 57,475 65,861 71,203 123,520 126,350
Ordinary profits . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,894 36,644 26,739 57,851 51,156
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,779 28,165 23,659 48,316 41,602
Capital stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000 100,000 100,000 100,000 100,000
Number of issued shares (in thousands) Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . 1,182,894 1,650,147 1,650,147 1,650,147 1,650,147Class A Series 4 preferred stock . . . . . . . . . . . . . — 24,072 24,072 24,072 24,072Class C Series 5 preferred stock . . . . . . . . . . . . . — 214,579 214,579 214,579 214,579
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387,231 509,311 499,010 554,266 507,344
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,622,256 5,041,077 4,786,661 4,912,933 4,797,393
Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 228,886 165,263 246,112 197,550
Deposits (Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,047,264 3,090,490 3,078,146 2,996,931 3,018,346
Loans and bills discounted . . . . . . . . . . . . . . . . . . . 2,616,611 2,721,623 2,703,401 2,781,445 2,649,085
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,001,390 1,264,381 1,147,217 1,034,306 1,206,752
Total equity per share (yen) (Note 2) . . . . . . . . . . . . . . . 331.83 305.25 296.44 326.22 286.02
Common stock(Interim) dividends per share (yen) . . . . . . . . . . . . 8.00 6.00 6.00 14.90 14.50
1st quarter end . . . . . . . . . . . . . . . . . . . . . . . . (4.00) (3.00) (3.00) (3.00) (3.00)2nd quarter end . . . . . . . . . . . . . . . . . . . . . . . (4.00) (3.00) (3.00) (3.00) (3.00)3rd quarter end . . . . . . . . . . . . . . . . . . . . . . . . (—) (—) (—) (4.00) (4.00)Year end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (—) (—) (—) (4.90) (4.50)
Class A Series 4 preferred stock(Interim) dividends per share (yen) . . . . . . . . . . . . — 4.00 4.50 8.00 9.00
1st quarter end . . . . . . . . . . . . . . . . . . . . . . . . (—) (2.00) (2.25) (2.00) (2.25)2nd quarter end . . . . . . . . . . . . . . . . . . . . . . . (—) (2.00) (2.25) (2.00) (2.25)3rd quarter end . . . . . . . . . . . . . . . . . . . . . . . . (—) (—) (—) (2.00) (2.25)Year end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (—) (—) (—) (2.00) (2.25)
Class C Series 5 preferred stock(Interim) dividends per share (yen) (Note 3) (Note 4) . . . . — 2.976 3.348 5.952 6.696
1st quarter end . . . . . . . . . . . . . . . . . . . . . . . . (—) (1.488) (1.674) (1.488) (1.674)2nd quarter end . . . . . . . . . . . . . . . . . . . . . . . (—) (1.488) (1.674) (1.488) (1.674)3rd quarter end . . . . . . . . . . . . . . . . . . . . . . . . (—) (—) (—) (1.488) (1.674)Year end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (—) (—) (—) (1.488) (1.674)
Basic net income per share (yen) (Note 2) . . . . . . . . . . . 20.38 23.51 19.57 40.16 34.24
Diluted net income per share (yen) (Note 2) . . . . . . . . . . 17.42 17.90 15.04 30.71 26.45
Dividend payout ratio (%) . . . . . . . . . . . . . . . . . . . . . 39.23 25.51 30.65 37.09 42.33
Capital adequacy ratio (domestic standard) (%) (Note 5) . . . . . . . . . . . . . . . . . — — 16.02 — —
Capital adequacy ratio (domestic standard) (%) (Note 6) . . . . . . . . . . . . . . . . . 10.79 14.75 — 14.23 14.97
Number of employees (Note 7) . . . . . . . . . . . . . . . . . . . 1,690 1,616 1,512 1,639 1,525
Notes: 1. Deposits include negotiable certificates of deposit (NCDs). 2. Total equity per share, basic net income per share and diluted net income per share are calculated by applying Financial Accounting Standard No. 2,
‘Accounting Standard for Earnings per Share’ and Financial Accounting Standards Implementation Guidance No. 4, ‘Implementation Guidance for Accounting Standard for Earnings per Share.’
3. In addition to the existing preferred dividend of ¥6.696 per share for ‘Dividends per share,’ the Bank paid a ¥20,490 million super preferred dividend from other capital surplus on the remaining Class C Series 5 preferred stock for the year ended March 31, 2014.
Dividend per share of the super preferred dividend is calculated by dividing total dividends of ¥20,490 million by 214,579 thousand shares of Class C Series 5 preferred stock as of March 31, 2014.
4. In addition to the existing preferred dividend of ¥5.952 per share for ‘Dividends per share,’ the Bank paid a ¥20,490 million super preferred dividend from other capital surplus on the remaining Class C Series 5 preferred stock for the year ended March 31, 2015.
Dividend per share of the super preferred dividend is calculated by dividing total dividends of ¥20,490 million by 214,579 thousand shares of Class C Series 5 preferred stock as of March 31, 2015.
5. Capital adequacy ratio (domestic standard) is calculated based on Basel II. 6. Capital adequacy ratio (domestic standard) is calculated based on Basel III. 7. Number of employees does not include executive officers, locally hired overseas staff or the Bank’s employees seconded to other firms.
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047
Financial and C
orporate Data
Non-C
onsolidated Sem
iannual Financial S
tatements
Non-Consolidated Semiannual Financial Statements
Non-Consolidated Semiannual Balance Sheet (Unaudited)Aozora Bank, Ltd.September 30, 2015
Millions of YenThousands ofU.S. Dollars
Assets Sep. 30, 2015 Sep. 30, 2014 Mar. 31, 2015 Sep. 30, 2015
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 505,987 ¥ 412,042 ¥ 499,253 $ 4,217,968 Due from banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,737 48,294 29,790 281,242 Call loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,059 20,000 20,000 167,222 Receivables under securities borrowing transactions . . . . . . . . . . . . . 14,861 34,178 58,889 123,888 Monetary claims bought . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,586 4,688 6,194 38,235 Trading assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296,632 374,294 347,104 2,472,759 Money held in trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,684 3,582 7,631 39,053 Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,001,390 1,264,381 1,034,306 8,347,705 Loans and bills discounted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,616,611 2,721,623 2,781,445 21,812,370 Foreign exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,972 26,178 29,259 208,172 Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78,033 91,530 70,621 650,499 Tangible fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,782 21,717 21,956 181,585 Intangible fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,540 4,726 7,000 79,530 Deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,776 36,952 24,406 223,213 Customers’ liabilities for acceptances and guarantees . . . . . . . . . . . . 26,307 38,529 38,968 219,305 Allowance for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (62,182) (59,647) (62,354) (518,359)Allowance for investment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,527) (1,995) (1,538) (12,736)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,622,256 ¥5,041,077 ¥4,912,933 $38,531,651
Millions of YenThousands ofU.S. Dollars
Liabilities and Equity Sep. 30, 2015 Sep. 30, 2014 Mar. 31, 2015 Sep. 30, 2015
Liabilities:Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥3,047,264 ¥3,090,490 ¥2,996,931 $25,402,337 Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 228,886 246,112 2,012,222 Call money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137,499 135,754 151,189 1,146,212 Payables under securities lending transactions . . . . . . . . . . . . . . . . . 256,612 381,571 293,020 2,139,147 Trading liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230,028 329,326 311,257 1,917,542 Borrowed money. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185,340 175,412 183,805 1,545,015 Bonds payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000 — — 83,361 Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89,641 139,264 125,791 747,263 Provision for retirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,962 10,711 9,899 74,710 Provision for credit losses on off-balance-sheet instruments . . . . . . . . 1,983 1,810 1,691 16,531 Provision for contingent loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 8 — — Acceptances and guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,307 38,529 38,968 219,305
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,235,025 4,531,766 4,358,667 35,303,645 Equity:Capital stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000 100,000 100,000 833,611Capital surplus
Legal capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87,313 87,313 87,313 727,855 Other capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 202,362 202,362 —
Retained earningsLegal retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,686 12,686 12,686 105,759 Other retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172,070 205,291 216,542 1,434,403
Treasury stock-at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,388) (99,333) (99,333) (28,244)Valuation difference on available-for-sale securities . . . . . . . . . . . . . . . 16,158 575 34,758 134,697 Deferred gains or losses on hedges . . . . . . . . . . . . . . . . . . . . . . . . . . 2,207 333 (145) 18,404 Subscription rights to shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182 81 81 1,521
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387,231 509,311 554,266 3,228,006 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥4,622,256 ¥5,041,077 ¥4,912,933 $38,531,651
Note: The translation of Japanese yen amounts into U.S. dollar amounts is included solely for the convenience of readers outside Japan and has been made at the rate of ¥119.96 to $1.00, the approximate rate of exchange at September 30, 2015.
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048
Financial and C
orporate Data
Non-C
onsolidated Sem
iannual Financial S
tatements
Non-Consolidated Semiannual Statement of Income (Unaudited)Aozora Bank, Ltd.For the six-month period ended September 30, 2015
Millions of YenThousands ofU.S. Dollars
Sep. 30, 2015(6 months)
Sep. 30, 2014(6 months)
Mar. 31, 2015(1 year)
Sep. 30, 2015(6 months)
Income:Interest income:
Interest on loans and discounts . . . . . . . . . . . . . . . . . . . . . . . . . ¥20,961 ¥20,269 ¥ 41,461 $174,735 Interest and dividends on securities . . . . . . . . . . . . . . . . . . . . . . 9,516 9,162 17,588 79,330 Interest on due from banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 21 48 282 Other interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,138 816 2,679 9,491
Fees and commissions income . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,528 7,797 15,778 54,425 Trading income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,991 5,028 10,119 33,271 Other ordinary income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,627 9,908 24,005 105,262 Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,678 12,856 11,839 22,324
Total income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57,475 65,861 123,520 479,120
Expenses:Interest expenses:
Interest on deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,237 4,854 9,322 35,323 Interest on debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308 271 562 2,573 Interest on borrowings and rediscounts . . . . . . . . . . . . . . . . . . . 637 501 1,082 5,312 Other interest expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,930 1,041 2,364 16,091
Fees and commissions expenses . . . . . . . . . . . . . . . . . . . . . . . . . 503 557 1,274 4,195 Trading expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318 — — 2,656 Other ordinary expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,651 3,076 11,221 22,107 General and administrative expenses . . . . . . . . . . . . . . . . . . . . . . . 17,374 16,748 35,347 144,832 Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 621 2,167 4,495 5,180
Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,582 29,218 65,670 238,269
Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,892 36,642 57,849 240,851
Income taxes:Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 1,341 2,736 1,023 Deferred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,990 7,135 6,796 41,597
Total income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,112 8,476 9,532 42,620
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥23,779 ¥28,165 ¥ 48,316 $198,231
Note: The translation of Japanese yen amounts into U.S. dollar amounts is included solely for the convenience of readers outside Japan and has been made at the rate of ¥119.96 to $1.00, the approximate rate of exchange at September 30, 2015.
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049
Financial and C
orporate Data
Non-C
onsolidated Sem
iannual Financial S
tatements
Non-Consolidated Semiannual Financial Statements
Non-Consolidated Semiannual Statement of Changes in Equity (Unaudited)Aozora Bank, Ltd.For the six-month period ended September 30, 2015
Millions of Yen
Capital stock
Capital surplus Retained earnings
Treasury stock-at cost
Valuation difference on
available-for-sale
securities
Deferred gains or
losses on hedges
Subscription rights to shares Total equity
Legal capitalsurplus
Other capitalsurplus
Legal retained earnings
Other retained earnings
Balance, April 1, 2014 . . . . . . . . . . ¥100,000 ¥87,313 ¥ 222,852 ¥12,686 ¥186,728 ¥ (99,333) ¥ (3,199) ¥ 295 ¥ — ¥ 507,344
Cumulative effects of accounting change . . . . . . . . . . . . (74) (74)
Restated balance . . . . . . . . . . . . . . 100,000 87,313 222,852 12,686 186,654 (99,333) (3,199) 295 — 507,269
Net income . . . . . . . . . . . . . . . . . . . 48,316 48,316
Dividends of surplus— other capital surplus . . . . . . . . . . . (20,490) (20,490)
Dividends of surplus . . . . . . . . . . . . (18,428) (18,428)
Net changes of items during the year . . . . . . . . . . . . . . . 37,957 (440) 81 37,599
Balance, April 1, 2015 . . . . . . . . . . ¥100,000 ¥87,313 ¥ 202,362 ¥12,686 ¥216,542 ¥ (99,333) ¥ 34,758 ¥ (145) ¥ 81 ¥ 554,266
Net income . . . . . . . . . . . . . . . . . . . 23,779 23,779
Dividends of surplus— other capital surplus . . . . . . . . . . . (20,490) (20,490)
Dividends of surplus . . . . . . . . . . . . (10,748) (10,748)
Purchase of treasury stock . . . . . . . (143,430) (143,430)
Retirement of treasury stock . . . . . . (239,375) 239,375 —
Transfer to capital surplus from retained earnings . . . . . . . . . 57,502 (57,502) —
Net changes of items during the period . . . . . . . . . . . . . (18,599) 2,352 100 (16,146)
Balance, September 30, 2015 . . . . ¥100,000 ¥87,313 ¥ — ¥12,686 ¥172,070 ¥ (3,388) ¥ 16,158 ¥2,207 ¥182 ¥ 387,231
Thousands of U.S. Dollars (Note)
Capital stock
Capital surplus Retained earnings
Treasury stock-at cost
Valuation difference on
available-for-sale
securities
Deferred gains or
losses on hedges
Subscription rights to shares Total equity
Legal capitalsurplus
Other capitalsurplus
Legal retained earnings
Other retained earnings
Balance, April 1, 2015 . . . . . . . . . . $833,611 $727,855 $ 1,686,920 $105,759 $1,805,119 $ (828,056) $ 289,747 $ (1,211) $ 682 $ 4,620,426
Net income . . . . . . . . . . . . . . . . . . . 198,231 198,231
Dividends of surplus— other capital surplus . . . . . . . . . . . (170,807) (170,807)
Dividends of surplus . . . . . . . . . . . . (89,599) (89,599)
Purchase of treasury stock . . . . . . . (1,195,649) (1,195,649)
Retirement of treasury stock . . . . . . (1,995,461) 1,995,461 —
Transfer to capital surplus from retained earnings . . . . . . . . . 479,348 (479,348) —
Net changes of items during the period . . . . . . . . . . . . . (155,050) 19,615 839 (134,596)
Balance, September 30, 2015 . . . . $833,611 $727,855 $ — $105,759 $1,434,403 $ (28,244) $ 134,697 $18,404 $1,521 $ 3,228,006
Note: The translation of Japanese yen amounts into U.S. dollar amounts is included solely for the convenience of readers outside Japan and has been made at the rate of ¥119.96 to $1.00, the approximate rate of exchange at September 30, 2015.
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050
Financial and C
orporate Data
Income A
nalysis (Non-C
onsolidated)
Income Analysis (Non-Consolidated)
Net Revenue, Business Profit For the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Net interest income . . . . . . . . . 24,544 10,370 14,173 23,606 11,763 11,842 48,456 22,953 25,502 Interest income . . . . . . . . . . . . 31,649 15,249 18,175 30,270 17,220 14,610 61,777 33,489 31,552
[1,775] [1,559] [3,264]Interest expenses . . . . . . . . . . 7,105 4,879 4,001 6,664 5,457 2,767 13,321 10,535 6,049
[1,775] [1,559] [3,264]Net fees and commissions . . . . 6,025 5,332 693 7,240 6,412 827 14,503 13,094 1,409
Fees and commissions (income) . . . . . . . . . . . . . . . . 6,528 5,535 993 7,797 6,774 1,022 15,778 13,759 2,018 Fees and commissions (expenses) . . . . . . . . . . . . . . 503 202 300 557 361 195 1,274 665 609
Net trading revenues . . . . . . . . 3,672 2,935 737 5,028 2,430 2,598 10,119 6,468 3,651 Trading profits. . . . . . . . . . . . . 3,991 3,223 767 5,028 2,430 2,598 10,119 6,468 3,651 Trading losses . . . . . . . . . . . . 318 288 29 — — — — — —
Net other ordinary income . . . . 9,975 7,872 2,102 6,832 5,789 1,042 12,784 11,409 1,374 Other ordinary income . . . . . . 12,627 8,248 4,378 9,908 6,654 3,253 24,005 14,184 9,820 Other ordinary expenses . . . . . 2,651 375 2,275 3,076 865 2,211 11,221 2,775 8,446
Net revenue . . . . . . . . . . . . . . . 44,217 26,510 17,706 42,706 26,394 16,311 85,863 53,926 31,937 Net revenue ratio (%) . . . . . . . . 2.23 1.50 2.16 2.10 1.45 2.44 2.10 1.47 2.23 Business profit . . . . . . . . . . . . . 26,368 — — 25,252 — — 38,712 — —
Yield on Interest-Earning Assets, Interest Rate on Interest-Bearing Liabilities, Net Yield/Interest RateFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(%)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Yield on interest-earning assets . . 1.59 0.86 2.21 1.49 0.95 2.19 1.51 0.91 2.20 Interest rate on interest-bearing liabilities . . . . . . . . . . . . . . . . . . 1.26 1.17 0.71 1.22 1.22 0.61 1.27 1.24 0.65 Net yield/interest rate . . . . . . . . . 0.33 (0.31) 1.50 0.27 (0.27) 1.58 0.24 (0.33) 1.55
RatiosFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(%)
Sep. 2015 Sep. 2014 Mar. 2015
Ordinary profits to total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.25 1.59 1.24 Ordinary profits to equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.27 14.37 10.89 Net income to total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.03 1.22 1.03 Net income to equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.10 11.05 9.10
Notes: 1. Domestic operations include yen-denominated transactions by domestic offices, while international operations include foreign currency- denominated transactions by domestic offices and transactions by overseas offices. Yen-denominated nonresident transactions and Japan offshore banking accounts are included under international operations.
2. Interest expenses are shown after deduction of amounts equivalent to interest expenses on money held in trust (¥7 million for the six-month period ended September 30, 2015, ¥4 million for the six-month period ended September 30, 2014 and ¥10 million for the year ended March 31, 2015)
3. Figures in brackets [ ] indicate interest received/paid as a result of interdepartmental lending and borrowing activities between domestic and international operations.
4. Net revenue ratio is calculated as follows: net revenue*
Net revenue ratio =
average balance of interest-bearing assets X 100
*As for the six-month periods ended on September 30, the numerator is annualized. 5. Business profit is calculated by deducting the net provision to general allowance for loan losses and general and administrative expenses from net
revenue.
Notes: 1. Return on assets, as calculated ordinary profits or net income* using ordinary profits or net income
= (average balance of total assets — customers’ liabilities for acceptances and guarantees)
X 100
2. Return on equity, as calculated ordinary profits or net income* using ordinary profits or net income
= (equity, beginning of period + equity, end of period) ÷ 2
X 100
* As for the six-month periods ended on September 30, the numerator is annualized.
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051
Financial and C
orporate Data
Income A
nalysis (Non-C
onsolidated)
Income Analysis (Non-Consolidated)
Average Balance of Interest-Earning Assets and Interest-Bearing Liabilities(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Balance of interest- earning assets
Average balance 3,960,963 3,533,370 1,637,836 4,039,492 3,611,444 1,330,488 4,085,410 3,648,803 1,431,151 [1,210,243] [902,440] [994,543]
Interest income/expense 31,649 15,249 18,175 30,270 17,220 14,610 61,777 33,489 31,552 [1,775] [1,599] [3,264]Return/rates (%) 1.59 0.86 2.21 1.49 0.95 2.19 1.51 0.91 2.20
Cash and due from Average balance 41,156 211 40,945 33,680 36 33,643 36,031 28 36,002 banks Interest income/expense 33 0 33 21 0 21 48 0 48
Return/rates (%) 0.16 0.05 0.16 0.12 0.16 0.12 0.13 0.10 0.13
Call loans Average balance 20,306 20,245 60 22,250 22,185 64 21,501 21,410 90 Interest income/expense 13 13 0 16 16 0 31 31 0 Return/rates (%) 0.13 0.13 0.63 0.15 0.15 0.42 0.14 0.14 0.34
Receivables under Average balance 24,115 24,115 — 35,771 35,771 — 45,625 45,625 — securities borrowing Interest income/expense 4 4 — 6 6 — 15 15 — transactions Return/rates (%) 0.03 0.03 — 0.03 0.03 — 0.03 0.03 —
Securities Average balance 1,072,602 453,014 619,587 1,295,070 714,169 580,901 1,257,039 661,543 595,496 Interest income/expense 9,516 2,132 7,383 9,162 2,783 6,379 17,588 4,160 13,427 Return/rates (%) 1.77 0.94 2.38 1.41 0.77 2.19 1.39 0.62 2.25
Loans and bills Average balance 2,728,019 1,804,273 923,746 2,617,749 1,930,343 687,406 2,677,817 1,914,818 762,999 discounted Interest income/expense 20,947 10,259 10,687 20,252 12,085 8,166 41,430 23,454 17,975
Return/rates (%) 1.53 1.13 2.31 1.54 1.24 2.36 1.54 1.22 2.35
Balance of interest- bearing liabilities
Average balance 3,997,967 3,633,771 1,574,439 3,910,747 3,523,772 1,289,415 3,925,766 3,556,414 1,363,895 [1,210,243] [902,440] [994,543]Interest income/expense 7,105 4,879 4,001 6,664 5,457 2,767 13,321 10,535 6,049
[1,775] [1,599] [3,264]Return/rates (%) 0.35 0.26 0.50 0.33 0.30 0.42 0.33 0.29 0.44
Deposits Average balance 2,777,468 2,732,884 44,584 2,732,197 2,716,309 15,888 2,731,351 2,713,775 17,576 Interest income/expense 4,067 4,002 65 4,702 4,652 49 9,015 8,916 99 Return/rates (%) 0.29 0.29 0.29 0.34 0.34 0.62 0.33 0.32 0.56
Negotiable certificates Average balance 324,756 324,756 — 262,562 262,562 — 277,030 277,030 — of deposit Interest income/expense 170 170 — 152 152 — 306 306 —
Return/rates (%) 0.10 0.10 — 0.11 0.11 — 0.11 0.11 —
Debentures Average balance 247,151 247,151 — 203,261 203,261 — 216,055 216,055 — Interest income/expense 308 308 — 271 271 — 562 562 — Return/rates (%) 0.24 0.24 — 0.26 0.26 — 0.26 0.26 —
Call money Average balance 166,660 103,756 62,904 165,707 113,409 52,298 177,909 117,244 60,664 Interest income/expense 238 43 195 178 68 110 417 125 292 Return/rates (%) 0.28 0.08 0.62 0.21 0.11 0.42 0.23 0.10 0.48
Payables under Average balance 276,389 66,519 209,869 321,675 61,451 260,223 325,064 76,954 248,110 securities lending Interest income/expense 352 18 334 297 22 274 595 48 546 transactions Return/rates (%) 0.25 0.05 0.31 0.18 0.07 0.21 0.18 0.06 0.22
Borrowed money Average balance 185,607 154,828 30,779 184,273 165,068 19,205 177,962 153,457 24,504 Interest income/expense 398 338 59 322 292 30 664 584 80 Return/rates (%) 0.42 0.43 0.38 0.34 0.35 0.31 0.37 0.38 0.32
Bonds payable Average balance 1,092 1,092 — — — — — — — Interest income/expense 1 1 — — — — — — — Return/rates (%) 0.21 0.21 — — — — — — —
Notes: 1. Interest-earning assets are shown after deduction of the average balance of non-interest-earning deposits. Interest-bearing liabilities are shown after deduction of amounts equivalent to the average balance of money held in trust and corresponding interest.
2. Figures in brackets [ ] indicate the average balances of interdepartmental lending and borrowing activities between domestic and international operations and corresponding interest income/expenses.
3. The average balance of foreign currency denominated transactions by domestic offices in international operations has been calculated using the daily current method.
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052
Financial and C
orporate Data
Income A
nalysis (Non-C
onsolidated)
Analysis of Interest Income and Interest Expenses(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Interest income Volume-related increase (decrease) (586) (371) 3,365 187 (108) 5,145 1,877 645 9,519 Rate-related increase (decrease) 1,966 (1,599) 199 (5,145) (2,578) (7,287) (4,141) (4,783) (7,337)
Net increase (decrease) 1,379 (1,970) 3,565 (4,958) (2,686) (2,141) (2,263) (4,138) 2,181
Cash and due Volume-related increase (decrease) 4 0 4 (2) (0) (2) 3 (0) 3 from banks Rate-related increase (decrease) 7 (0) 7 (12) 0 (12) (15) 0 (15)
Net increase (decrease) 12 0 11 (15) 0 (15) (12) 0 (12)
Call loans Volume-related increase (decrease) (1) (1) (0) (17) (16) (0) (29) (28) (0)Rate-related increase (decrease) (1) (1) 0 2 2 0 3 3 0 Net increase (decrease) (3) (3) 0 (14) (14) (0) (26) (25) (0)
Receivables under Volume-related increase (decrease) (2) (2) — 6 6 — 17 17 — securities borrowing Rate-related increase (decrease) (0) (0) — (3) (3) — (11) (11) — transactions Net increase (decrease) (2) (2) — 3 3 — 6 6 —
Securities Volume-related increase (decrease) (1,569) (1,014) 423 (146) (438) 2,605 483 (489) 3,685 Rate-related increase (decrease) 1,923 364 580 (3,811) 405 (6,529) (2,735) 325 (5,773)
Net increase (decrease) 353 (650) 1,003 (3,957) (33) (3,923) (2,252) (164) (2,088)
Loans and bills Volume-related increase (decrease) 850 (787) 2,800 428 (1,040) 2,658 1,166 (2,115) 5,884 discounted Rate-related increase (decrease) (155) (1,038) (279) (1,020) (1,343) (865) (1,475) (2,460) (1,615)
Net increase (decrease) 695 (1,825) 2,521 (591) (2,384) 1,792 (308) (4,576) 4,268
Interest expenses Volume-related increase (decrease) 148 169 610 271 131 922 518 322 1,742 Rate-related increase (decrease) 293 (747) 624 (1,594) (1,442) (805) (2,450) (2,703) (986)Net increase (decrease) 441 (577) 1,234 (1,323) (1,310) 117 (1,931) (2,380) 755
Deposits Volume-related increase (decrease) 77 28 89 62 61 0 36 19 20 Rate-related increase (decrease) (713) (679) (74) (1,362) (1,388) 26 (2,487) (2,497) 5 Net increase (decrease) (635) (650) 15 (1,299) (1,326) 26 (2,451) (2,477) 26
Negotiable Volume-related increase (decrease) 35 35 — (3) (3) — (7) (7) — certificates Rate-related increase (decrease) (17) (17) — (4) (4) — (23) (23) — of deposit Net increase (decrease) 18 18 — (7) (7) — (31) (31) —
Debentures Volume-related increase (decrease) 58 58 — 86 86 — 169 169 — Rate-related increase (decrease) (21) (21) — (135) (135) — (177) (177) — Net increase (decrease) 36 36 — (48) (48) — (7) (7) —
Call money Volume-related increase (decrease) 1 (5) 22 20 3 30 50 4 92 Rate-related increase (decrease) 59 (19) 63 16 0 2 69 (15) 38
Net increase (decrease) 60 (25) 85 37 4 32 119 (10) 130
Payables under Volume-related increase (decrease) (41) 1 (53) 90 20 29 157 44 29 securities lending Rate-related increase (decrease) 97 (6) 112 (156) (5) (110) (229) (18) (127) transactions Net increase (decrease) 55 (4) 59 (66) 14 (81) (71) 26 (97)
Borrowed money Volume-related increase (decrease) 2 (18) 18 (35) (54) 35 16 (42) 79 Rate-related increase (decrease) 73 64 10 112 105 (9) 171 161 (10)
Net increase (decrease) 75 46 28 77 51 26 188 119 68
Bonds payable Volume-related increase (decrease) — — — — — — — — — Rate-related increase (decrease) 1 1 — — — — — — —
Net increase (decrease) 1 1 — — — — — — —
Note: Changes due to a combination of volume- and rate-related increases (decreases) have been included in rate-related increase (decrease).
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053
Financial and C
orporate Data
Income A
nalysis (Non-C
onsolidated)
Income Analysis (Non-Consolidated)
Fees and Commissions (Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Net fees and commissions . . . . 6,025 5,332 693 7,240 6,412 827 14,503 13,094 1,409
Fees and commissions income . . . . . . . . . . . . . . . . 6,528 5,535 993 7,797 6,774 1,022 15,778 13,759 2,018
Deposits, debentures and loan operations . . . . . . . . 2,336 1,760 576 4,066 3,358 708 6,907 5,543 1,363 Foreign exchange operations . . . . . . . . . . . . 95 68 27 86 67 19 172 133 39 Securities-related operations . . . . . . . . . . . . 1,000 1,000 — 904 904 — 2,002 2,002 — Agency services . . . . . . . . . 2,732 2,367 364 2,590 2,316 273 6,007 5,419 588 Safekeeping and safe deposit box services . . . . — — — 0 0 — 0 0 — Guarantee operations . . . . . 76 52 24 73 69 4 152 144 8 Other . . . . . . . . . . . . . . . . . 286 285 1 74 57 17 534 516 18
Fees and commissions expenses . . . . . . . . . . . . . . 503 202 300 557 361 195 1,274 665 609
Foreign exchange operations . . . . . . . . . . . . 56 45 11 51 42 9 104 85 19 Other . . . . . . . . . . . . . . . . . 446 157 289 505 319 186 1,169 579 589
Trading Revenues(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Net trading revenues . . . . . . . . 3,672 2,935 737 5,028 2,430 2,598 10,119 6,468 3,651
Trading income . . . . . . . . . . 3,991 3,223 767 5,028 2,430 2,598 10,119 6,468 3,651 Gains on trading securities . . . . . . . . . . . . . — — — — — — — — — Gains on securities related to trading transactions . . . — — — 270 340 (69) 883 888 (5)Gains on trading-related financial derivatives . . . . . 3,991 3,223 767 4,758 2,090 2,667 9,236 5,580 3,656 Other . . . . . . . . . . . . . . . . . — — — — — — 0 0 —
Trading expenses . . . . . . . . 318 288 29 — — — — — — Losses on trading securities . . . . . . . . . . . . — — — — — — — — — Losses on securities related to trading transactions . . . 318 288 29 — — — — — — Losses on trading-related financial derivatives . . . . . — — — — — — — — — Other . . . . . . . . . . . . . . . . . — — — — — — — — —
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054
Financial and C
orporate Data
Income A
nalysis (Non-C
onsolidated)
Other Ordinary Income(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Net other ordinary income . . . . 9,975 7,872 2,102 6,832 5,789 1,042 12,784 11,409 1,374
Other ordinary income . . . . . 12,627 8,248 4,378 9,908 6,654 3,253 24,005 14,184 9,820 Gains on foreign exchange transactions . . . . . . . . . . . — — — — — — — — — Gains on sales of bonds . . . 4,846 1,474 3,371 4,897 2,819 2,077 11,088 4,955 6,132 Gains on redemption of bonds . . . . . . . . . . . . . — — — — — — — — — Gains on derivatives . . . . . . — — — — — — — — — Other . . . . . . . . . . . . . . . . . 7,780 6,773 1,006 5,011 3,834 1,176 12,916 9,228 3,687
Other ordinary expenses . . . 2,651 375 2,275 3,076 865 2,211 11,221 2,775 8,446 Losses on foreign exchange transactions . . . 1,473 — 1,473 310 — 310 194 — 194 Losses on sales of bonds . . 359 0 358 1,661 123 1,537 8,230 1,628 6,601 Losses on redemption of bonds . . . . . . . . . . . . . — — — — — — — — — Losses on devaluation of bonds . . . . . . . . . . . . . 0 — 0 0 — 0 0 — 0 Amortization of debenture and corporate bonds issuance expenses . . . . . . 34 34 — 14 14 — 45 45 — Losses on derivatives . . . . . 53 — 53 23 — 23 14 — 14 Other . . . . . . . . . . . . . . . . . 731 340 390 1,066 727 339 2,736 1,100 1,635
General and Administrative Expenses(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
General and administrative expenses . . . . . . . . . . . . . . . . . . . . . . 17,374 16,748 35,347Salaries and related expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,414 7,188 14,959Retirement benefit expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (356) (355) (719)Welfare expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 255 233 473Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,568 1,137 2,293Rent and lease expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,533 1,523 3,112Building and maintenance expenses . . . . . . . . . . . . . . . . . . . . . . . 24 17 130Supplies expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103 99 334Water, lighting and heating expenses . . . . . . . . . . . . . . . . . . . . . . . 256 276 531Travel expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154 147 277Communication expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 277 276 560Publicity and advertising expenses . . . . . . . . . . . . . . . . . . . . . . . . 165 233 691Taxes, other than income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,069 1,062 2,099Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,906 4,907 10,605
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055
Financial and C
orporate Data
Deposit O
perations (Non-C
onsolidated)
Deposit Operations (Non-Consolidated)
Balance by Deposit Account(Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
DepositsLiquid deposits Average balance 413,983 413,983 — 395,100 395,100 — 397,837 397,837 —
(%) (14.91) (15.15) — (14.46) (14.55) — (14.57) (14.66) — Term-end balance 413,704 413,704 — 374,817 374,817 — 430,438 430,438 — (%) (15.05) (15.14) — (13.56) (13.66) — (15.88) (15.98) —
Interest-bearing Average balance 393,841 393,841 — 374,137 374,137 — 377,776 377,776 — deposits (%) (14.18) (14.41) — (13.69) (13.77) — (13.83) (13.92) —
Term-end balance 390,653 390,653 — 356,107 356,107 — 409,781 409,781 — (%) (14.21) (14.30) — (12.88) (12.98) — (15.12) (15.22) —
Time deposits Average balance 2,314,146 2,314,146 — 2,314,671 2,314,671 — 2,309,565 2,309,565 — (in general) (%) (83.32) (84.68) — (84.72) (85.21) — (84.56) (85.11) —
Term-end balance 2,314,726 2,314,726 — 2,358,547 2,358,547 — 2,256,013 2,256,013 — (%) (84.22) (84.73) — (85.33) (85.99) — (83.24) (83.78) —
Deregulated Average balance 1,880,807 1,880,807 — 1,874,733 1,874,733 — 1,873,158 1,873,158 — interest rate (%) (67.72) (68.82) — (68.62) (69.02) — (68.58) (69.02) — time deposits Term-end balance 1,874,281 1,874,281 — 1,919,112 1,919,112 — 1,842,106 1,842,106 — (fixed) (%) (68.19) (68.61) — (69.43) (69.97) — (67.97) (68.41) —
Deregulated Average balance 433,339 433,339 — 439,937 439,937 — 436,407 436,407 — interest rate (%) (15.60) (15.86) — (16.10) (16.20) — (15.98) (16.08) — time deposits Term-end balance 440,445 440,445 — 439,434 439,434 — 413,906 413,906 — (floating) (%) (16.02) (16.12) — (15.90) (16.02) — (15.27) (15.37) —
Others Average balance 49,338 4,753 44,584 22,425 6,537 15,888 23,949 6,372 17,576 (%) (1.77) (0.17) (100.00) (0.82) (0.24) (100.00) (0.87) (0.23) (100.00)Term-end balance 20,132 3,381 16,751 30,557 9,577 20,980 23,827 6,415 17,411 (%) (0.73) (0.13) (100.00) (1.11) (0.35) (100.00) (0.88) (0.24) (100.00)
Subtotal Average balance 2,777,468 2,732,884 44,584 2,732,197 2,716,309 15,888 2,731,351 2,713,775 17,576 (%) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00)Term-end balance 2,748,564 2,731,813 16,751 2,763,923 2,742,942 20,980 2,710,278 2,692,867 17,411 (%) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00)
Negotiable certificates Average balance 324,756 324,756 — 262,562 262,562 — 277,030 277,030 — of deposit Term-end balance 298,700 298,700 — 326,567 326,567 — 286,653 286,653 —
Total Average balance 3,102,224 3,057,640 44,584 2,994,759 2,978,871 15,888 3,008,382 2,990,805 17,576 Term-end balance 3,047,264 3,030,513 16,751 3,090,490 3,069,509 20,980 2,996,931 2,979,520 17,411
Notes: 1. Time deposits (in general) = Time deposits Deregulated interest rate time deposits (fixed) = Deregulated interest rate time deposits for which the interest up to the due date is determined
when the deposits are made. Deregulated interest rate time deposits (floating) = Deregulated interest rate time deposits for which the interest varies according to changes in
market interest rates during the period of deposit. 2. Liquid deposits = Deposits at notice + ordinary deposits + current deposits 3. Average balance of domestic offices’ foreign currency-denominated transactions in the international operations sector has been computed by the
daily current method.
Balance of Time Deposits by Residual Period(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Total
Deregulated interest rate
(fixed)
Deregulated interest rate
(floating) Total
Deregulated interest rate
(fixed)
Deregulated interest rate
(floating) Total
Deregulated interest rate
(fixed)
Deregulated interest rate
(floating)
Less than 3 months . . . . . . . 427,103 410,003 17,100 477,308 470,258 7,050 416,388 400,388 16,000 3–6 months. . . . . . . . . . . . . . 270,297 253,447 16,850 343,015 330,265 12,750 279,523 266,373 13,150 6 months–1 year . . . . . . . . . . 502,599 500,799 1,800 480,151 470,351 9,800 441,880 437,580 4,300 1–2 years . . . . . . . . . . . . . . . 287,284 276,784 10,500 294,395 287,795 6,600 341,257 336,157 5,100 2–3 years . . . . . . . . . . . . . . . 213,081 205,281 7,800 203,854 188,554 15,300 216,840 206,323 10,517 More than 3 years . . . . . . . . . 614,360 227,964 386,395 559,822 171,887 387,934 560,122 195,283 364,839
Total . . . . . . . . . . . . . . . . . . 2,314,726 1,874,281 440,445 2,358,547 1,919,112 439,434 2,256,013 1,842,106 413,906
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056
Financial and C
orporate Data
Deposit O
perations (Non-C
onsolidated)
Deposits per Office(Number of Offices, Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices
Number of offices . . . . . . . . . 20 20 — 20 20 — 20 20 — Deposits per office . . . . . . . . 152,363 152,363 — 154,524 154,524 — 149,846 149,846 —
Notes: 1. Deposits include negotiable certificates of deposit. 2. Number of offices does not include domestic sub-branches and overseas representative offices.
Deposits per Employee(Number of Employees, Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices
Number of employees . . . . . . 1,681 1,681 — 1,584 1,584 — 1,605 1,605 — Deposits per employee . . . . . 1,812 1,812 — 1,951 1,951 — 1,867 1,867 —
Notes: 1. Deposits include negotiable certificates of deposit. 2. Number of employees represents the average number of employees in each fiscal year. The number of employees in domestic offices includes
head office staff.
Outstanding Balance by Depositor(Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
Balance Share Balance Share Balance Share
Corporate . . . . . . . . . . . . . . . . . . . . . . . . . 382,594 13.92 423,967 15.34 387,876 14.31 Retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,761 72.79 2,026,983 73.34 2,030,887 74.93 Public sector . . . . . . . . . . . . . . . . . . . . . . . 37,271 1.36 29,621 1.07 12,603 0.47 Financial institutions . . . . . . . . . . . . . . . . . 327,936 11.93 283,351 10.25 278,912 10.29
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,748,564 100.00 2,763,923 100.00 2,710,278 100.00
Note: The above balance does not include negotiable certificates of deposit in offshore market accounts.
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057
Financial and C
orporate Data
Debenture O
perations (Non-C
onsolidated)
Debenture Operations (Non-Consolidated)
Outstanding and Average Balance of Debentures(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Term-end balance
Average balance
Term-end balance
Average balance
Term-end balance
Average balance
Aozora debentures . . . . . . . . . . . . . . . . . . 241,386 247,151 228,886 203,261 246,112 216,055
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 247,151 228,886 203,261 246,112 216,055
Note: Debentures do not include debenture subscriptions.
Balance by Residual Period (Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalAozora
debentures TotalAozora
debentures TotalAozora
debentures
Less than 1 year . . . . . . . . . . . . . . . . . . . . 96,806 96,806 67,661 67,661 83,751 83,751 1–3 years . . . . . . . . . . . . . . . . . . . . . . . . . 118,100 118,100 161,225 161,225 155,660 155,660 3–5 years . . . . . . . . . . . . . . . . . . . . . . . . . 26,480 26,480 — — 6,700 6,700 5–7 years . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Over 7 years . . . . . . . . . . . . . . . . . . . . . . . — — — — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,386 241,386 228,886 228,886 246,112 246,112
Outstanding Balance of Debentures per Office(Number of Offices, Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices
Number of offices . . . . . . . . . 20 20 — 20 20 — 20 20 — Outstanding balance of debentures per office . . . . . 12,069 12,069 — 11,444 11,444 — 12,305 12,305 —
Note: Number of offices does not include domestic sub-branches and overseas representative offices.
Outstanding Balance of Debentures per Employee(Number of Employees, Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices
Number of employees . . . . . . 1,681 1,681 — 1,584 1,584 — 1,605 1,605 — Outstanding balance of debentures per employee . . 143 143 — 144 144 — 153 153 —
Note: Number of employees represents the average number of employees in each fiscal year. The number of employees in domestic offices includes head office staff.
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058
Financial and C
orporate Data
Loan Operations (N
on-Consolidated)
Loan Operations (Non-Consolidated)
Outstanding Balance of LoansFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Loans on deeds Average balance 2,469,616 1,548,772 920,843 2,348,484 1,663,386 685,098 2,410,053 1,649,746 760,306 Term-end balance 2,377,289 1,442,887 934,401 2,418,523 1,660,552 757,970 2,484,421 1,601,755 882,665
Loans on bills Average balance 41,011 39,239 1,772 49,381 48,425 956 48,597 47,219 1,378 Term-end balance 40,597 38,890 1,706 48,487 47,558 928 44,050 42,203 1,847
Overdrafts Average balance 216,963 215,833 1,130 219,051 217,700 1,351 218,491 217,177 1,314 Term-end balance 198,646 197,297 1,348 254,038 252,650 1,388 252,361 251,320 1,041
Bills discounted Average balance 427 427 — 831 831 — 674 674 — Term-end balance 79 79 — 574 574 — 611 611 —
Total Average balance 2,728,019 1,804,273 923,746 2,617,749 1,930,343 687,406 2,677,817 1,914,818 762,999 Term-end balance 2,616,611 1,679,155 937,456 2,721,623 1,961,336 760,287 2,781,445 1,895,890 885,554
Notes: 1. The average balance of foreign currency-denominated transactions by domestic offices in international operations has been calculated using the daily current method.
2. The Bank carries out partial and direct write-off of loans. This also applies to the table shown below.
Balance by Residual Period(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalFixed
interestFloating interest Total
Fixed interest
Floating interest Total
Fixed interest
Floating interest
Less than 1 year . . . . . . . . . . 1,009,849 965,253 1,072,249 1–3 years . . . . . . . . . . . . . . . 559,059 125,269 433,790 705,815 164,819 540,996 637,068 131,353 505,714 3–5 years . . . . . . . . . . . . . . . 723,227 114,795 608,432 716,477 147,836 568,641 750,712 123,604 627,107 5–7 years . . . . . . . . . . . . . . . 156,623 30,200 126,423 194,191 35,676 158,514 171,691 37,101 134,590 Over 7 years . . . . . . . . . . . . . 167,829 57,048 110,781 139,835 62,283 77,551 149,687 61,019 88,668 Indefinite period . . . . . . . . . . 20 — 20 49 — 49 35 — 35 Total . . . . . . . . . . . . . . . . . . 2,616,611 2,721,623 2,781,445
Notes: 1. Maturity is based on scheduled final maturity dates. 2. No distinction has been made between fixed interest and floating interest for loans with a residual period of less than 1 year.
Ratio of Loans and Bills Discounted to Debentures/Deposits(Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Loans and bills discounted (A) . . 2,616,611 1,679,155 937,456 2,721,623 1,961,336 760,287 2,781,445 1,895,890 885,554 Debentures and deposits (B) . . . 3,288,650 3,271,899 16,751 3,319,376 3,298,396 20,980 3,243,043 3,225,632 17,411 (A)/(B) . . . . . . . . . . . . . . . . . . . . . 79.56 51.32 5,596.37 81.99 59.46 3,623.79 85.76 58.77 5,086.11Average during the year . . . . . . . 81.44 54.59 2,071.89 81.85 60.66 4,326.55 83.04 59.71 4,341.02Notes: 1. Debentures do not include debenture subscriptions. 2. Deposits include negotiable certificates of deposit.
Loans per Office(Number of Offices, Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices
Number of offices . . . . . . . . . 20 20 — 20 20 — 20 20 — Loans per office . . . . . . . . . . 130,830 130,830 — 136,081 136,081 — 139,072 139,072 — Note: Number of offices does not include domestic sub-branches and overseas representative offices.
Loans per Employee(Number of Employees, Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices
Number of employees . . . . . . 1,681 1,681 — 1,584 1,584 — 1,605 1,605 — Loans per employee . . . . . . . 1,556 1,556 — 1,718 1,718 — 1,732 1,732 — Note: Number of employees represents the average number of employees in each period (year). The number of employees in domestic offices includes head
office staff.
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059
Financial and C
orporate Data
Loan Operations (N
on-Consolidated)
Loan Operations (Non-Consolidated)
Loans to Small and Medium-Sized Corporations(Number of Borrowers, Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
Number of borrowers Value
Number of borrowers Value
Number of borrowers Value
Total domestic loans (A) . . . . . . . . . . . . . . 1,646 2,616,611 1,949 2,721,623 1,845 2,781,445Loans to small and medium-sized corporations (B) . . . . . . . . . . . . . . . . . . . 1,260 1,835,869 1,515 1,876,295 1,435 1,927,407(B)/(A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76.54 70.16 77.73 68.94 77.77 69.29
Notes: 1. In this table, the balance of loans and bills discounted does not include offshore banking accounts. 2. SMEs are defined as companies having capital of not more than ¥300 million (¥100 million in wholesale, and ¥50 million in retail, food service and
leasing business categories), or companies with not more than 300 full-time employees (100 in wholesale and leasing, 50 in retail and food service business categories), etc.
Consumer Loans Outstanding(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Consumer loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,031 4,873 4,009Housing loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,518 4,582 3,974Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 513 291 35
Note: Consumer loans outstanding includes personal housing loans, as well as personal loans for general spending purposes and tax payments, and does not include business loans to sole proprietorships or their owners.
Breakdown of Loans and Bills Discounted by Industry(Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
Balance of loans Share Balance of loans Share Balance of loans Share
Loans by domestic offices . . . . . . . . . . . 2,616,611 100.00 2,721,623 100.00 2,781,445 100.00 (excluding Japan Offshore Market accounts)
Manufacturing . . . . . . . . . . . . . . . . . . . . 212,512 8.12 278,522 10.23 264,304 9.50 Agriculture, forestry and fisheries . . . . . . 2,689 0.10 3,076 0.11 3,139 0.11 Mining, quarry, gravel extraction . . . . . . 1,437 0.06 1,812 0.07 1,627 0.06 Construction . . . . . . . . . . . . . . . . . . . . . 15,916 0.61 21,901 0.80 22,155 0.80 Electricity, gas, heat supply and water . . 15,271 0.58 10,229 0.38 14,339 0.52 Information and communications . . . . . 33,024 1.26 45,369 1.67 40,229 1.45 Transport, postal service . . . . . . . . . . . . 72,589 2.77 104,530 3.84 82,284 2.96 Wholesale and retail trade . . . . . . . . . . . 115,243 4.41 121,983 4.48 127,820 4.59 Financial and insurance . . . . . . . . . . . . . 389,025 14.87 414,413 15.23 433,157 15.57 Real estate . . . . . . . . . . . . . . . . . . . . . . 569,077 21.75 636,908 23.40 604,207 21.72 Leasing . . . . . . . . . . . . . . . . . . . . . . . . . 98,882 3.78 114,938 4.22 116,714 4.20 Other services. . . . . . . . . . . . . . . . . . . . 144,486 5.52 166,989 6.14 160,315 5.76 Local governments . . . . . . . . . . . . . . . . 24,394 0.93 42,012 1.54 40,402 1.45 Others . . . . . . . . . . . . . . . . . . . . . . . . . 922,061 35.24 758,935 27.89 870,747 31.31
Loans by overseas offices . . . . . . . . . . . — — — — — — (including Japan Offshore Market accounts)
Government . . . . . . . . . . . . . . . . . . . . . — — — — — — Financial institutions . . . . . . . . . . . . . . . — — — — — — Others . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,616,611 2,721,623 2,781,445 Note: Domestic refers to the Bank’s head office and branch offices; overseas refers to the Bank’s overseas branch offices.
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060
Financial and C
orporate Data
Loan Operations (N
on-Consolidated)
Risk-Monitored Loans by Industry(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Loans by domestic offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,983 51,908 38,143 (excluding Japan Offshore Market accounts)
Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,358 3,013 3,365 Agriculture, forestry and fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Mining, quarry, gravel extraction . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Electricity, gas, heat supply and water . . . . . . . . . . . . . . . . . . . . . . . — — — Information and communications . . . . . . . . . . . . . . . . . . . . . . . . . . 66 66 66 Transport, postal service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 21 21 Wholesale and retail trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 620 1,541 1,173 Financial and insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 13,026 7,800 Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,510 14,711 6,294 Leasing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 238 351 238 Other services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 2 46 Local governments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,123 19,173 19,137
Loans by overseas offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — (including Japan Offshore Market accounts)
Government . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Financial institutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,983 51,908 38,143
Balance of Loans and Bills Discounted, Classified by Purpose(Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
Balance of loans Share Balance of loans Share Balance of loans Share
Funds for capital investment . . . . . . . . . . . 227,584 8.70 231,242 8.50 239,074 8.60Funds for working capital . . . . . . . . . . . . . 2,389,027 91.30 2,490,381 91.50 2,542,370 91.40
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,616,611 100.00 2,721,623 100.00 2,781,445 100.00
Breakdown of Balance of Acceptances and Guarantees (Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Acceptances of bills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Letters of credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,420 — —Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,887 38,529 38,968
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,307 38,529 38,968
Breakdown of Loans and Bills Discounted by Collateral(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,969 9,917 12,773 Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,592 28,716 27,024 Merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,609 177,658 166,315 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,699 11,360 5,775
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 192,871 227,653 211,888
Guaranteed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135,904 180,749 168,161 Unsecured . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,287,836 2,313,220 2,401,395
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,616,611 2,721,623 2,781,445
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061
Financial and C
orporate Data
Loan Operations (N
on-Consolidated)
Loan Operations (Non-Consolidated)
Breakdown of Collateral for Customers’ Liabilities for Acceptances and Guarantees(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 8 160
Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 8 160
Guaranteed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,938 2,009 518 Unsecured . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,247 36,511 38,289
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,307 38,529 38,968
Write-Off of Loans(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Write-off of loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 700 946
Allowance for Loan LossesFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Balance at beginning of period Provision
Reduction during period
Balance at end of
period
Balance at beginning of period Provision
Reduction during period
Balance at end of
period
Balance at beginning
of year Provision
Reduction during year
Balance at end of
year
Used for specific purpose Other
Used for specific purpose Other
Used for specific purpose Other
General allowance . . . . . 53,689 53,061 — 53,689 53,061 43,409 44,875 — 43,409 44,875 43,409 53,689 — 43,409 53,689
Specific (7) (–179) (–587) allowance . . . . . 8,658 9,121 312 8,346 9,121 21,249 14,772 59 21,189 14,772 21,656 8,665 4,762 16,893 8,665
Related to non- (7) (–179) (–587) residents . . . . 3,381 7,105 — 3,381 7,105 4,024 4,126 53 3,970 4,126 4,431 3,388 53 4,378 3,388
Allowance for loans to restructuring countries . . . . . — — — — — — — — — — — — — — —
Note: Figures in parentheses for balance at beginning of period (year) indicate translation difference due to foreign exchange fluctuations.
Country Risk ReserveNone.
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062
Financial and C
orporate Data
Loan Operations (N
on-Consolidated)
Disclosed Claims under the Financial Reconstruction Law(Billions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Disclosed claims under the Financial Reconstruction Law Bankrupt and similar credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.3 0.5 0.3 Doubtful credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.7 40.3 26.2 Special attention credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.0 11.3 11.8
Subtotal (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.0 52.0 38.2 Normal credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,622.2 2,713.4 2,787.1
Total credit (B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,647.2 2,765.4 2,825.3
(A/B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.94% 1.88% 1.35%
Risk-Monitored LoansNon-Consolidated
(Billions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Risk-monitored loans: Loans to bankrupt companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0.0 — Past due loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.0 40.7 26.4 Loans overdue for three months or more . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Restructured loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.0 11.3 11.8
Total (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.0 51.9 38.1
Year-end balance of total loans (B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,616.6 2,721.6 2,781.4
(A/B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.95% 1.90% 1.37%
Reserve Provision Ratios for Each Category of Borrower, Based on Asset-AssessmentsNon-Consolidated
(%)
Definition of Borrower Categories Sep. 2015 Sep. 2014 Mar. 2015
Normal 1.4 1.0 1.2Need attention: Other need attention borrowers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.9 5.5 7.0 Special attention borrowers (Ratio of reserve to unsecured) . . . . . . . . . . . . . . . 43.5 65.9 64.8In danger of bankruptcy (Ratio of reserve to unsecured) . . . . . . . . . . . . . . . . . . . 74.3 90.7 76.0De facto bankrupt and bankrupt (Ratio of reserve to unsecured) . . . . . . . . . . . . . 100.0 100.0 100.0
Consolidated
(Billions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
Risk-monitored loans: Loans to bankrupt companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0.0 — Past due loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.0 40.7 26.4 Loans overdue for three months or more . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — Restructured loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.8 12.0 12.5
Total (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.8 52.7 38.9
Year-end balance of total loans (B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,610.4 2,719.8 2,775.8
(A/B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.98% 1.93% 1.40%
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063
Financial and C
orporate Data
Loan Operations (N
on-Consolidated)
Loan Operations (Non-Consolidated)
<Definitions of Borrower Categories>Normal Business performance is strong and no special financial
problems exist.
Need attention Borrowers that need to be monitored carefully because of weak business fundamentals, financial problems or problematic lending conditions.
In danger of Borrowers that are not currently bankrupt but are highly bankruptcy likely to become bankrupt.
De facto Borrowers that are substantially bankrupt but are not bankrupt legally or practically bankrupt yet.
Bankrupt Borrowers that are legally or practically bankrupt.
<Definitions of Asset Classifications>Category I Assets that present no particular risk of collectability or
impairment of value.
Category II Assets, including credits, which bear above-average risk of collectability.
Category III Assets that bear substantial risk of final collectability or impairment of value, and are likely to incur losses.
Category IV Assets deemed to be uncollectable or valueless.
<Write-Off and Reserve Provision Rules>Normal and A general allowance is provided by applying the estimated Need attention loan-loss ratio determined based on the historical loan-loss borrowers data over a defined period in the past. However, for borrowers
with large credit exposure, the loan-loss amount estimated by the DCF method is reflected as an addition to the allowance for loan losses calculated based on the estimated loan-loss ratio, if necessary.
In danger of A specific allowance is provided for the loan losses at an bankruptcy amount considered to be necessary based on an overall borrowers solvency assessment of the borrowers and expected collectible
amounts through the disposal of collateral or execution of guarantees, etc. For loans whose future cash flows of principal and interest are reasonably estimated, the difference between the discounted cash flows and the carrying value is accounted for as an allowance for loan losses.
De facto In principle, the full amounts of credits that bear substantial bankrupt and risk of final collectability or impairment of value, and credits Bankrupt deemed to be uncollectable or valueless are written off directly. borrowers
<Definitions of Disclosed Claims under the Financial Reconstruction Law>Bankrupt and Bankrupt and similar credit refers to the credit of borrowers similar credit who have filed for bankruptcy, corporate reorga nization,
composition, etc., as well as those borrowers who are in an equivalent situation.
Doubtful credit Doubtful refers to credit with serious doubt concerning the recovery of principal and receiving of interest as contract provisions, because the borrower’s financial condition and business results have worsened, although they have not reached the point of management collapse.
Special attention Special attention refers to loans in arrears for more than credit three months or with mitigated conditions.
Normal credit Normal credit refers to credit to borrowers whose financial condition and business results have no particular problem and which are not categorized in any of the above categories.
<Risk-Monitored Loans>Loans to Loans to bankrupt borrowers are loans for which interest bankrupt in arrears has not been accrued because recovery or borrowers settlement of principal or interest is unlikely due to the
prolonged delay in payment of principal or interest (which hereafter shall be called ‘non-accrual loans’) and whose borrowers are legally bankrupt (defined below), excluding the amount of write-offs.
1. Borrowers that have applied for commencement of company or financial institution reorganization procedures under the provisions of the Corporate Reorganization Law.
2. Borrowers that have applied for reorganization under the provisions of the Civil Reorganization Law.
3. Borrowers that have applied for bankruptcy under the provisions of the Bankruptcy Law.
4. Borrowers that have applied to commence special liquidation under the provisions of the Company Law.
5. Borrowers with reasons equivalent to 1. to 4. above as defined by Ministry of Finance ordinances.
6. Borrowers who have applied for commencement of legal liquidation procedures under overseas laws, corresponding to those listed above.
Past due loans Past due loans refer to non-accrual loans except those for which concessions on payment of interest were made in order to assist the reorganization of bankrupt companies and loans to them.
Loans overdue Loans overdue for three months or more refer to those for three loans, excluding loans to bankrupt companies and past months or due loans for which principal or interest remains unpaid more for at least three months.
Restructured Restructured loans refer to those loans, excluding loans loans to bankrupt companies, past due loans and loans overdue
for three months or more for which agreement was made to provide reduction or a moratorium on interest payments, or concessions in the borrower’s favor on interest or principal payments or to waive claims for the purpose of assisting the reconstruction of insolvent borrowers.
<Differences Between Disclosed Claims under theFinancial Reconstruction Law and Risk-Monitored Loans>• Disclosed Claims
Disclosure: Loans and other claims equivalent thereof (foreign exchange, acceptances and guarantees, suspense payments, as well as loaned securities that require notation [limited to only those subject to a usage and lending or lending agreement], etc.).
Disclosed: By borrower (by loan for substandard credit)
• Risk-Monitored Loans
Disclosure: Loans only
Disclosed: By loan
Asset-Assessment, Disclosed Claims, Write-Offs, Reserves and Risk-Monitored Loans(After Partial and Direct Write-Offs, Non-Consolidated Basis) as of September 30, 2015
(Billions of Yen)
Borrower categoriesfor self-assessment
Bankrupt borrowers
In danger of bankruptcy borrowers
Normal borrowers
De facto bankrupt borrowers
Disclosed credit under the FRLLoans Other
Doubtful credit20.7
Special attention credit4.0
Normal credit2,622.2
Bankrupt and similar credit0.3
Disclosed claims under the FRL25.0
Total credit 2,647.2
Reserve and coveragefor claims under the FRL
Total reserve 62.2
Collateral/Guarantee coverage 8.9Reserve 10.7
Estimated collections 5.4
Collateral/Guarantee coverage 0.3Reserve —
Collateral/Guarantee coverage 8.6Reserve 9.0
Estimated collections 3.1
Collateral/Guarantee coverage —Reserve 1.7
Estimated collections 2.3
Reserve and coverage for claims under the FRL
Reserve to unsecured credit ratio
100.0%
85.0%
43.5%
100.0%
74.3%
43.5%
Risk-monitored loans
Restructured loans4.0
Risk-monitored loans25.0Reserve and
coverage ratio for disclosed claims
under the FRL78.6%
Reserve ratio for disclosed claims
under the FRL66.6%
Loans overdue for three months or more
—
Past due loans21.0
Loans to bankrupt companies—
Need attention borrowers
FRL: Financial Reconstruction LawReserve to unsecured credit ratio = Reserve ÷ (Claims – Collateral, guarantees, etc.)Reserve and coverage ratio = (Collateral, guarantees, etc. + Reserve) ÷ Claims
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064
Financial and C
orporate Data
Securities (N
on-Consolidated)
Securities (Non-Consolidated)
Outstanding and Average Balance of Securities Held (Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Total Average balance 1,072,602 453,014 619,587 1,295,070 714,169 580,901 1,257,039 661,543 595,496 (%) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00)Term-end balance 1,001,390 437,507 563,883 1,264,381 639,360 625,021 1,034,306 486,195 548,110 (%) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00) (100.00)
Japanese Average balance 191,470 191,470 — 387,039 387,039 — 359,522 359,522 — national (%) (17.85) (42.27) — (29.89) (54.19) — (28.60) (54.35) — government Term-end balance 135,176 135,176 — 339,255 339,255 — 193,763 193,763 — bonds (%) (13.50) (30.90) — (26.83) (53.06) — (18.73) (39.85) —
Japanese Average balance 15,032 15,032 — 12,919 12,919 — 14,350 14,350 — local (%) (1.40) (3.32) — (1.00) (1.81) — (1.14) (2.17) — government Term-end balance 14,983 14,983 — 12,387 12,387 — 18,515 18,515 — bonds (%) (1.49) (3.42) — (0.98) (1.94) — (1.79) (3.81) —
Japanese Average balance — — — — — — — — — short-term (%) — — — — — — — — — corporate Term-end balance — — — — — — — — — bonds (%) — — — — — — — — —
Japanese Average balance 36,849 36,849 — 41,335 41,335 — 39,858 39,858 — corporate (%) (3.44) (8.13) — (3.19) (5.79) — (3.17) (6.02) — bonds Term-end balance 36,920 36,920 — 37,354 37,354 — 35,895 35,895 —
(%) (3.69) (8.44) — (2.96) (5.84) — (3.47) (7.38) —
Japanese Average balance 34,985 34,985 — 41,500 41,500 — 37,373 37,373 — stocks (%) (3.26) (7.72) — (3.20) (5.81) — (2.97) (5.65) —
Term-end balance 55,764 55,764 — 42,885 42,885 — 54,197 54,197 — (%) (5.57) (12.75) — (3.39) (6.71) — (5.24) (11.15) —
Others Average balance 794,264 174,676 619,587 812,275 231,373 580,901 805,934 210,438 595,496 (%) (74.05) (38.56) (100.00) (62.72) (32.40) (100.00) (64.12) (31.81) (100.00)Term-end balance 758,545 194,662 563,883 832,499 207,477 625,021 731,933 183,822 548,110 (%) (75.75) (44.49) (100.00) (65.84) (32.45) (100.00) (70.77) (37.81) (100.00)
Notes: 1. Total for ‘Others’ is the sum of domestic operations and international operations. 2. The average balance of foreign currency-denominated transactions by domestic offices in international operations has been calculated using the
daily current method.
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065
Financial and C
orporate Data
Securities (N
on-Consolidated)
Securities (Non-Consolidated)
Ratio of Securities to Debentures and Deposits(Millions of Yen, %)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
operationsInternational operations Total
Domestic operations
International operations Total
Domestic operations
International operations
Securities (A) . . . . . . . . . . . . . . 1,001,390 437,507 563,883 1,264,381 639,360 625,021 1,034,306 486,195 548,110Debentures and deposits (B) . . 3,288,650 3,271,899 16,751 3,319,376 3,298,396 20,980 3,243,043 3,225,632 17,411
Ratio (A)/(B) . . . . . . . . . . . . . . 30.44 13.37 3,366.23 38.09 19.38 2,979.07 31.89 15.07 3,148.03Average during the year . . . . . 32.02 13.70 1,389.68 40.49 22.44 3,656.21 38.98 20.62 3,388.03
Notes: 1. Debentures do not include debenture subscriptions. 2. Deposits include negotiable certificates of deposit.
Balance of Securities by Residual Period(Millions of Yen)
Sep. 2015
Japanese national government bonds
Japanese local government bonds
Japanese short-term corporate bonds
Japanese corporate bonds Japanese stocks Others
Less than 1 year . . . . 127,100 590 — 2,660 13,072 1—3 years . . . . . . . . — 1,038 — 5,595 25,346 3—5 years . . . . . . . . 8,076 6,647 — 2,461 65,531 5—7 years . . . . . . . . — 1,040 — 15,307 23,916 7—10 years . . . . . . . — 5,628 — 3,894 115,794 Over 10 years . . . . . . — 37 — 7,001 85,068 Indefinite period . . . . — — — — 55,764 429,816
Total . . . . . . . . . . . . 135,176 14,983 — 36,920 55,764 758,545
(Millions of Yen)
Sep. 2014
Japanese national government bonds
Japanese local government bonds
Japanese short-term corporate bonds
Japanese corporate bonds Japanese stocks Others
Less than 1 year . . . . 249,977 335 — 1,030 13,590 1—3 years . . . . . . . . — 793 — 11,491 31,478 3—5 years . . . . . . . . 23,068 6,874 — 2,264 161,333 5—7 years . . . . . . . . 40,005 451 — 13,906 32,608 7—10 years . . . . . . . 15,592 3,893 — 3,661 97,092 Over 10 years . . . . . . 10,612 39 — — 91,041 Indefinite period . . . . — — — 5,000 42,885 405,354
Total . . . . . . . . . . . . 339,255 12,387 — 37,354 42,885 832,499
(Millions of Yen)
Mar. 2015
Japanese national government bonds
Japanese local government bonds
Japanese short-term corporate bonds
Japanese corporate bonds Japanese stocks Others
Less than 1 year . . . . 160,000 645 — 995 7,792 1—3 years . . . . . . . . — 1,961 — 10,265 24,735 3—5 years . . . . . . . . 8,076 7,361 — 1,019 81,857 5—7 years . . . . . . . . 10,095 872 — 16,028 36,096 7—10 years . . . . . . . 15,592 7,635 — 7,586 138,365 Over 10 years . . . . . . — 38 — — 92,507 Indefinite period . . . . — — — — 54,197 350,578
Total . . . . . . . . . . . . 193,763 18,515 — 35,895 54,197 731,933
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066
Financial and C
orporate Data
Securities B
usiness/International Operations
(Non-C
onsolidated)
Securities Business (Non-Consolidated)
International Operations (Non-Consolidated)
Underwriting of Public Bonds(Millions of Yen)
Sep. 2015 Sep. 2014
Japanese national government bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —Japanese local government bonds and government-guaranteed bonds . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Over-the-Counter Sales of Public Bonds and Securities Investment Trusts(Millions of Yen)
Sep. 2015 Sep. 2014
Japanese national government bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —Japanese local government bonds and government-guaranteed bonds . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Securities investment trusts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,234 44,705
Balance of Assets in International Operations(Millions of Yen)
Sep. 2015 Sep. 2014 Mar. 2015
TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices TotalDomestic
officesOverseas
offices
Balance of assets in international operations . . . . . 1,750,244 1,750,244 — 1,773,425 1,773,425 — 1,767,907 1,767,907 —
Foreign Exchange Transactions(Millions of U.S. Dollars)
Sep. 2015 Sep. 2014 Mar. 2015
Outward exchange: Foreign bills sold . . . . . . . . . . . . . . 3,232 3,149 6,373 Foreign bills bought . . . . . . . . . . . . — — —
Incoming exchange: Foreign bills payable . . . . . . . . . . . 1,514 1,099 1,917 Foreign bills receivable . . . . . . . . . — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,746 4,248 8,291
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067
Financial and C
orporate Data
Other O
perations (Non-C
onsolidated)
Other Operations (Non-Consolidated)
Principal Fees and Commissions (As of January 1, 2016)
Automated Installations
Jan. 2016
Automated teller machines (ATMs). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(Millions of Yen, Thousands of Transactions)
Sep. 2015 Sep. 2014 Mar. 2015
Value of transactions
Number of transactions
Value of transactions
Number of transactions
Value of transactions
Number of transactions
Money transferSent . . . . . . . . . . . . . . . . . . . . . 1,966,935 507 2,399,707 485 4,920,840 978 Received . . . . . . . . . . . . . . . . . . 2,298,021 282 2,521,829 279 5,186,419 572
Money transfer by checkSent . . . . . . . . . . . . . . . . . . . . . 9,004 1 8,554 2 15,624 4 Received . . . . . . . . . . . . . . . . . . 7,075 1 8,608 2 15,669 4
To Aozora Bank Head Office/
Branches
To Other Banks
By Wire
Transfers Handled at the counter
Clients with accounts at the Bank
On transfers up to ¥30,000
¥216 ¥540
On transfers exceeding ¥30,000
¥432 ¥756
Clients without accounts at the Bank
On transfers up to ¥30,000
¥216
¥1,029On transfers exceeding ¥30,000
¥432
Telephone banking On transfer ¥0 ¥308
Internet banking (retail) On transfer ¥0 ¥154
Collection of payments
For same-site (local) payment Per item ¥216
For different-site (remote) payment Per item ¥432 Urgent Normal
¥864 ¥648
Checks and notes Checks cost ¥648 for one book of 50 sheets Notes cost ¥1,080 for one book of 50 sheets
Cashier’s checks ¥540 per check
Document/Card reissuing ¥1,080 to reissue each account book, transaction receipt or certificate ¥1,080 to reissue each card
Balance verification ¥432 per section each timeNotes: 1. Amounts include 8% consumption tax and regional tax. 2. The account pre-registered by customers who are registered for telephone banking will be used. 3. Transfers by telegraph are no longer provided as of June 1, 2010.
Domestic Exchange TransactionsFor the six-month periods ended September 30, 2015 and 2014, and the year ended March 31, 2015
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068
Financial and C
orporate Data
Capitalization (N
on-Consolidated)
Capitalization (Non-Consolidated)
History of Capitalization(Millions of Yen)
Month/Year Capital increases
Capital thereafter Remarks
Sep. 2000 66,666 419,781 Compensatory private placement (common stock, 333,334 thousand shares); Issue price ¥300; Transfer to capital ¥200
Oct. 2000 (260,000) 159,781 Non-compensatory reduction of capital• Capital reduction of ¥105,287 million by redemption of the 2nd preferred
stock, 102,000 thousand shares; the 3rd preferred stock, 386,398 thousand shares; and the 4th preferred stock, 71,856 thousand shares
• Capital reduction of ¥154,712 million exceeding face amount of common stock and transferred to capital
Oct. 2000 260,000 419,781 Compensatory private placement (the 5th preferred stock, 866,667 thousand shares); Issue price ¥300; Transfer to capital ¥300
Nov. 2012 (319,781) 100,000 Capital reduction (Change in capital composition)Capital stock was reduced by ¥319,781 million. Of which, ¥53,980 million was transferred to legal capital surplus, and the remaining ¥265,801 million was transferred to other capital surplus.
Major Shareholders(As of September 30, 2015)
Common Stock
Number of shares heldPercentage of
total outstanding shares
The Master Trust Bank of Japan, Ltd. (Trust Account) . . . . . . . . . . . . . 74,489,000 6.30%Japan Trustee Services Bank, Ltd. (Trust Account) . . . . . . . . . . . . . . . 72,011,000 6.09ORIX Bank Corporation (Trust Account 5200011) . . . . . . . . . . . . . . . . 26,969,000 2.28STATE STREET BANK AND TRUST COMPANY 505225. . . . . . . . . . . 26,204,681 2.22STATE STREET BANK WEST CLIENT–TREATY 505234 . . . . . . . . . . . 21,339,160 1.80Aozora Bank, Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,500,033 1.39Japan Trustee Services Bank, Ltd. (Trust Account 4) . . . . . . . . . . . . . 15,083,000 1.28Japan Trustee Services Bank, Ltd. (Trust Account 9) . . . . . . . . . . . . . 14,483,000 1.22Japan Trustee Services Bank, Ltd. (Trust Account 5) . . . . . . . . . . . . . 13,619,000 1.15Japan Trustee Services Bank, Ltd. (Trust Account 6) . . . . . . . . . . . . . 13,578,000 1.15Japan Trustee Services Bank, Ltd. (Trust Account 2) . . . . . . . . . . . . . 13,458,000 1.14Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 875,160,307 73.98Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,182,894,181 100.00Notes: 1. The above table was compiled based on the Bank’s Shareholder Registry as of September 30, 2015. 2. Sumitomo Mitsui Trust Bank, Limited submitted a Major Shareholders Report dated July 6, 2015, stating their holdings with joint shareholder
Sumitomo Mitsui Trust Asset Management Co., Ltd. and Nikko Asset Management Co., Ltd. as of June 30, 2015, as follows. They are not included, however, in the above table of major shareholders as the Bank was unable to confirm the actual number of shares held by the aforementioned shareholders as of the end of the second quarter.
Number of shares held Percentage of shares held
Sumitomo Mitsui Trust Bank, Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,882,900 3.12%
Sumitomo Mitsui Trust Asset Management Co., Ltd. . . . . . . . . . . . . . . . . . . . . . 2,670,000 0.23
Nikko Asset Management Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,732,000 1.84
3. BlackRock Japan Co., Ltd. submitted a Major Shareholders Report dated July 6, 2015, stating their holdings with joint shareholder BlackRock Investment Management LLC, BlackRock (Luxembourg) S.A., BlackRock Life Limited, BlackRock Asset Management Ireland Limited, BlackRock Fund Advisors, BlackRock Institutional Trust Company, N.A. and BlackRock Investment Management (UK) Limited as of June 30, 2015, as follows. They are not included, however, in the above table of major shareholders as the Bank was unable to confirm the actual number of shares held by the aforementioned shareholders as of the end of the second quarter.
Number of shares held Percentage of shares held
BlackRock Japan Co., Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,799,000 1.67%
BlackRock Investment Management LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,305,730 0.11
BlackRock (Luxembourg) S.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,913,000 0.25
BlackRock Life Limited. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,997,072 0.25
BlackRock Asset Management Ireland Limited . . . . . . . . . . . . . . . . . . . . . . . . . . 6,362,355 0.54
BlackRock Fund Advisors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,306,000 1.55
BlackRock Institutional Trust Company, N.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,968,408 1.52
BlackRock Investment Management (UK) Limited. . . . . . . . . . . . . . . . . . . . . . . . 3,987,000 0.34
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069
Financial and C
orporate Data
Capitalization (N
on-Consolidated)
Capitalization (Non-Consolidated)
Ownership and Distribution of Shares(As of September 30, 2015)
Common Stock
Classification
Stock Status (1 tangen unit = 1,000 shares)
Fractional shares of common
stock
National and
municipal governments
Financial institutions
Financial instruments
firms
Other domestic
companies
Foreign Investors
Individuals and others Total
Other than individuals Individuals
Number of shareholders . . . — 81 59 688 522 61 62,974 64,385 —Number of shares held (tangen) . . . . . . . . . . . . . . — 342,741 19,722 22,076 468,741 309 329,050 1,182,639 255,181Percentage of total number of shares . . . . . . — 28.98 1.67 1.87 39.63 0.03 27.82 100.00 —Notes: 1. Treasury stock of 16,500,033 shares comprises 16,500 tangen units under Individuals and others and 33 shares under Fractional shares of
common stock. 2. In the Other domestic companies column, shares in the name of Japan Securities Depository Center, Incorporated represent one tangen unit.
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070
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
This section describes the information consistent with FSA Notice Number 7, Basel III Pillar III—Market Discipline, based on Article 19-2.1.5.d and 19-3.1.3.c of the Ordinance for the Enforcement of the Banking Act (Ministry of Finance Ordinance Number 10, 1982), issued in 2014.‘Notice’ in this section refers to FSA Notice Number 19, Basel III Pillar I—Minimum Capital Requirements and Buffers, issued in 2006.
Composition of Capital Disclosure
Composition of Capital Disclosure (Consolidated)(Basel III) (Millions of Yen)
Items Sep. 30, 2015
Amounts excluded under
transitional arrangements Sep. 30, 2014
Amounts excluded under
transitional arrangements
Core capital: instruments and reserves (1)Directly issued qualifying common share capital and preferred share capital with mandatory conversion clause plus related stock surplus and retained earnings . . . . . 370,470 510,487
of which: capital and capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 187,313 389,676 of which: retained earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191,211 224,011 of which: treasury stock (–). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,388 99,333 of which: national specific regulatory adjustments (earnings to be distributed) (–) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,665 3,866 of which: other than above. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Accumulated other comprehensive income included in Core capital . . . . . . . . . . . . . 2,091 (294) of which: foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . 1,168 (294) of which: remeasurements of defined benefit plans . . . . . . . . . . . . . . . . . . . . . . . 922 —
Subscription rights to common shares and preferred shares with mandatory conversion clause . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182 81 Adjusted non-controlling interests (amount allowed in group Core capital) . . . . . . . . . — — Total of general allowance for loan losses and eligible provisions included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,983 42,728
of which: general allowance for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,983 42,728 of which: eligible provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Eligible non-cumulative perpetual preferred shares subject to transitional arrangements included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Eligible capital instruments, other than non-cumulative perpetual preferred shares, subject to transitional arrangements included in Core capital . . . . . . . . . . . . . . . . . . . — — Capital instruments issued using public capital injection programs included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Amounts equivalent to 45% of land revaluation excess subject to transitional arrangements included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Non-controlling interests subject to transitional arrangements included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 768 882 Core capital: instruments and reserves (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 416,497 553,885
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071
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Core capital: regulatory adjustments (2)Total intangible assets (net of related tax liability, excluding those relating to mortgage servicing rights) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,309 5,236 — 3,093
of which: goodwill (including those equivalent) . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: other intangibles other than goodwill and mortgage servicing rights . . . 1,309 5,236 — 3,093
Deferred tax assets that rely on future profitability excluding those arising from temporary differences (net of related tax liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 768 3,072 — 5,857 Shortfall of eligible provisions to expected losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Securitization gain on sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Gains and losses due to changes in own credit risk on fair valued liabilities . . . . . . . . — — — — Defined-benefit pension fund net assets (prepaid pension costs) . . . . . . . . . . . . . . . . 758 3,032 — 1,882 Investments in own shares (excluding those reported in the Net assets section) . . . . 6 25 — 37 Reciprocal cross-holdings in capital instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Investments in the common stock and preferred stock with mandatory conversion clause of banking, financial and insurance entities that are outside the scope of regulatory consolidation, net of eligible short positions, where the bank does not own more than 10% of the issued common share capital of the entity (amount above the 10% threshold) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Amount exceeding the 10% threshold on specified items . . . . . . . . . . . . . . . . . . . . . — — — —
of which: significant investments in the common stock and preferred stock with mandatory conversion clause of financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: mortgage servicing rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: deferred tax assets arising from temporary differences (net of related tax liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — —
Amount exceeding the 15% threshold on specified items . . . . . . . . . . . . . . . . . . . — — — — of which: significant investments in the common stock and preferred stock with mandatory conversion clause of financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: mortgage servicing rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: deferred tax assets arising from temporary differences (net of related tax liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — —
Core capital: regulatory adjustments (B). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,841 — Regulatory capitalRegulatory capital ((A)–(B)) (C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 413,655 553,885 Risk-weighted assets (3)Credit risk assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,438,714 3,418,247
Total of items subject to transitional arrangements included in risk-weighted assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (73,078) (121,194)
of which: intangibles other than goodwill and mortgage servicing rights . . . . . . 5,236 3,093 of which: deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,072 5,857 of which: defined-benefit pension fund net assets (prepaid pension costs) . . . . 3,032 1,882 of which: investments in capital instruments of financials . . . . . . . . . . . . . . . . . (84,444) (132,063) of which: other than above. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 37
Risk assets derived from market risk equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160,032 145,554 Risk assets derived from operational risk equivalents. . . . . . . . . . . . . . . . . . . . . . . . . 152,210 139,996 Adjustments to credit risk assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Adjustments to operational risk equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Total risk-weighted assets (D) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,750,957 3,703,799 Consolidated capital adequacy ratioConsolidated capital adequacy ratio ((C)/(D)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.02% 14.95%
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
(Millions of Yen)
Items Sep. 30, 2015
Amounts excluded under
transitional arrangements Sep. 30, 2014
Amounts excluded under
transitional arrangements
Methods used to calculate risk-weighted assets and amounts of required capital for each risk are as follows:(Millions of Yen)
Methods Sep. 30, 2015 Sep. 30, 2014
Total required capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,038 148,151
Credit risk. . . . . . . . . . . . . . . . . . . . . . . Standardized approach 137,548 136,729 Market risk equivalents. . . . . . . . . . . . . Internal models approach and
Standardized approach 6,401
5,822
Operational risk equivalents . . . . . . . . . Standardized approach 6,088 5,599
Note: Consolidated capital adequacy ratio is calculated based on the Notice. The Bank uses the domestic standard applicable to Japanese banks without overseas branches or banking subsidiaries.
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072
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Composition of Capital Disclosure (Non-consolidated)(Basel III) (Millions of Yen)
Items Sep. 30, 2015
Amounts excluded under
transitional arrangements Sep. 30, 2014
Amounts excluded under
transitional arrangements
Core capital: instruments and reserves (1)Directly issued qualifying common share capital and preferred share capital with mandatory conversion clause plus related stock surplus and retained earnings . . . . . 364,017 504,454
of which: capital and capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 187,313 389,676 of which: retained earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 184,757 217,978 of which: treasury stock (–). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,388 99,333 of which: national specific regulatory adjustments (earnings to be distributed) (–) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,665 3,866 of which: other than above. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Subscription rights to common shares and preferred shares with mandatory conversion clause . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182 81 Total of general allowance for loan losses and eligible provisions included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,140 42,889
of which: general allowance for loan losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,140 42,889 of which: eligible provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Eligible non-cumulative perpetual preferred shares subject to transitional arrangements included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Eligible capital instruments, other than non-cumulative perpetual preferred shares, subject to transitional arrangements included in Core capital . . . . . . . . . . . . . . . . . . . — — Capital instruments issued using public capital injection programs included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Amounts equivalent to 45% of land revaluation excess subject to transitional arrangements included in Core capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Core capital: instruments and reserves (A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 407,340 547,425 Core capital: regulatory adjustments (2)Total intangible assets (net of related tax liability, excluding those relating to mortgage servicing rights) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,277 5,109 — 3,041
of which: goodwill (including those equivalent) . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: other intangibles other than goodwill and mortgage servicing rights . . . 1,277 5,109 — 3,041
Deferred tax assets that rely on future profitability excluding those arising from temporary differences (net of related tax liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 742 2,968 — 5,376 Shortfall of eligible provisions to expected losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Securitization gain on sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Gains and losses due to changes in own credit risk on fair valued liabilities . . . . . . . . — — — — Defined-benefit pension fund net assets (prepaid pension costs) . . . . . . . . . . . . . . . . — — — — Investments in own shares (excluding those reported in the Net assets section) . . . . 6 25 — 37 Reciprocal cross-holdings in capital instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Investments in the common stock and preferred stock with mandatory conversion clause of banking, financial and insurance entities that are outside the scope of regulatory consolidation, net of eligible short positions, where the bank does not own more than 10% of the issued common share capital of the entity (amount above the 10% threshold) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Amount exceeding the 10% threshold on specified items . . . . . . . . . . . . . . . . . . . . . — — — —
of which: significant investments in the common stock and preferred stock with mandatory conversion clause of financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: mortgage servicing rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: deferred tax assets arising from temporary differences (net of related tax liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — —
Amount exceeding the 15% threshold on specified items . . . . . . . . . . . . . . . . . . . — — — — of which: significant investments in the common stock and preferred stock with mandatory conversion clause of financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: mortgage servicing rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — of which: deferred tax assets arising from temporary differences (net of related tax liability) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — —
Core capital: regulatory adjustments (B). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,025 — Regulatory capitalRegulatory capital ((A)–(B)) (C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 405,314 547,425
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073
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
Risk-weighted assets (3)Credit risk assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,451,235 3,431,126
Total of items subject to transitional arrangements included in risk-weighted assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (76,342) (123,608)
of which: intangibles other than goodwill and mortgage servicing rights . . . . . . 5,109 3,041 of which: deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,968 5,376 of which: defined-benefit pension fund net assets (prepaid pension costs) . . . . — — of which: investments in capital instruments of financials . . . . . . . . . . . . . . . . . (84,444) (132,063) of which: other than above. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 37
Risk assets derived from market risk equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159,564 145,527 Risk assets derived from operational risk equivalents. . . . . . . . . . . . . . . . . . . . . . . . . 144,980 132,300 Adjustments to credit risk assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Adjustments to operational risk equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Total risk-weighted assets (D) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,755,780 3,708,954 Non-consolidated capital adequacy ratioNon-consolidated capital adequacy ratio ((C)/(D)). . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.79% 14.75%
Methods used to calculate risk-weighted assets and amounts of required capital for each risk are as follows:(Millions of Yen)
Methods Sep. 30, 2015 Sep. 30, 2014
Total required capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,231 148,358
Credit risk. . . . . . . . . . . . . . . . . . . . . . . Standardized approach 138,049 137,245 Market risk equivalents. . . . . . . . . . . . . Internal models approach and
Standardized approach 6,382 5,821
Operational risk equivalents . . . . . . . . . Standardized approach 5,799 5,292
Note: Non-consolidated capital adequacy ratio is calculated based on the Notice. The Bank uses the domestic standard applicable to Japanese banks without overseas branches or banking subsidiaries.
(Millions of Yen)
Items Sep. 30, 2015
Amounts excluded under
transitional arrangements Sep. 30, 2014
Amounts excluded under
transitional arrangements
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074
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Quantitative Disclosure
1. Names of subsidiaries classified as other financial institutions under the Notice whose capital is short of the regulatory amount required, and total shortfall amount of such subsidiaries
(As of end-September 2015 and end-September 2014)Not applicable
2. Items pertaining to capital adequacy(1) Breakdown by Portfolio (Non-Consolidated)
(100 Million Yen)
Sep. 2015 Sep. 2014
CategoryAmount of exposure
Amount of credit
risk assets
Amount of capital
requirementsAmount of exposure
Amount of credit
risk assets
Amount of capital
requirements
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 — — 154 — — Claims on Japanese government/bank. . . . . . . . . . . . . . . . . . . . . . . . . 6,998 — — 9,142 — — Claims on foreign central government/bank . . . . . . . . . . . . . . . . . . . . . 2,643 20 1 3,397 6 0 Claims on Bank for International Settlements (BIS) . . . . . . . . . . . . . . . . — — — — — — Claims on Japanese local public bodies . . . . . . . . . . . . . . . . . . . . . . . . 400 3 0 552 4 0 Claims on non-central government public sector entities (PSEs) of foreign countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 373 87 3 467 103 4 Claims on multilateral development banks (MDBs) . . . . . . . . . . . . . . . . — — — — — — Claims on Japan Finance Organization for Municipalities (JFM) . . . . . . . 8 0 0 4 0 0 Claims on organs affiliated with the Japanese government . . . . . . . . . . 341 33 1 532 52 2 Claims on three major local public corporations . . . . . . . . . . . . . . . . . . 186 2 0 307 2 0 Claims on financial institutions and Type I financial instruments business operators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,194 613 25 3,960 754 30 Claims on corporate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,425 12,482 499 15,939 13,864 555 Claims on SMEs and individuals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Mortgage-backed housing loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 5 0 19 7 0 Claims on projects including acquisition of real estate properties . . . . . 2,089 2,089 84 2,042 2,032 81 Loans overdue for three months or more . . . . . . . . . . . . . . . . . . . . . . . 491 543 22 539 709 28 Cash items in process of collection . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Loans guaranteed by Credit Guarantee Association, etc. . . . . . . . . . . . 0 0 0 0 0 0 Loans guaranteed by Regional Economy Vitalization Corporation of Japan (REVIC), etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Equity, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,808 2,799 112 2,599 2,585 103 Securitization (as originating bank) . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — —
Rating-based approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Look-through approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Risk weight = 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — —
Securitization (not as originating bank) . . . . . . . . . . . . . . . . . . . . . . . . . 5,903 6,380 255 5,450 6,029 241 Rating-based approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 240 136 5 146 129 5 Look-through approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,625 5,761 230 5,230 5,180 207 Risk weight = 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 483 19 56 695 28
Fund (look-through approach) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,218 6,032 241 4,687 5,184 207 Risk weight 0% to 20% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 0 0 20 4 0 Risk weight > 20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 324 132 5 508 173 7 Risk weight > 50% <= 100% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,224 1,140 46 690 465 19 Risk weight > 100% <= 150% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,326 3,735 149 3,190 3,590 144 Risk weight > 150% < 1,250%. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340 983 39 267 800 32 Risk weight = 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 43 2 12 151 6
Amount calculated by dividing equivalent CVA risk amount by 8% . . . . — 508 20 — 605 24 Central counterparty-related. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 825 33 1 187 7 0 Total of items included in risk weighted assets subject to phase-out arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 692 765 31 965 965 39 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,008 2,118 85 817 1,430 57 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,730 34,512 1,380 51,741 34,311 1,372 Notes: 1. Amount of Exposure • After deducting the amount equivalent to partial direct write-offs (before applying credit risk mitigation effect). Specific allowance for loan-losses and allowance for loans to restructuring countries are not subject to the
deduction. • The amount is equivalent to credit extension set forth in the Notice (after the effect of deducting the amount
equivalent to credit extension under the close-out netting agreement). 2. Amount of Credit Risk • After applying credit risk mitigation effect. 3. Amount of Capital Requirements • As the standard approach and domestic standard are adopted by Aozora Bank, the amount is calculated
taking 4% of credit risk assets. 4. Indication Method after • The amount is rounded to the nearest whole number. The same applies to the following charts. the Decimal Point
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075
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
Breakdown by Portfolio (Consolidated)(100 Million Yen)
Sep. 2015 Sep. 2014
CategoryAmount of exposure
Amount of credit
risk assets
Amount of capital
requirementsAmount of exposure
Amount of credit
risk assets
Amount of capital
requirements
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 — — 154 — — Claims on Japanese government/bank. . . . . . . . . . . . . . . . . . . . . . . . . 7,013 — — 9,145 — — Claims on foreign central government/bank . . . . . . . . . . . . . . . . . . . . . 2,643 20 1 3,397 6 0 Claims on Bank for International Settlements (BIS) . . . . . . . . . . . . . . . . — — — — — — Claims on Japanese local public bodies . . . . . . . . . . . . . . . . . . . . . . . . 400 3 0 552 4 0 Claims on non-central government public sector entities (PSEs) of foreign countries 373 87 3 467 103 4 Claims on multilateral development banks (MDBs) . . . . . . . . . . . . . . . . — — — — — — Claims on Japan Finance Organization for Municipalities (JFM) . . . . . . . 8 0 0 4 0 0 Claims on organs affiliated with the Japanese government . . . . . . . . . . 341 33 1 532 52 2 Claims on three major local public corporations . . . . . . . . . . . . . . . . . . 186 2 0 307 2 0 Claims on financial institutions and Type I financial instruments business operators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,436 661 26 4,135 790 32 Claims on corporate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,824 15,890 636 18,484 16,329 653 Claims on SMEs and individuals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Mortgage-backed housing loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 5 0 19 7 0 Claims on projects including acquisition of real estate properties . . . . . 2,125 2,125 85 2,075 2,065 83 Loans overdue for three months or more . . . . . . . . . . . . . . . . . . . . . . . 1,174 1,568 63 1,144 1,585 63 Cash items in process of collection . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Loans guaranteed by Credit Guarantee Association, etc. . . . . . . . . . . . 0 0 0 0 0 0 Loans guaranteed by Regional Economy Vitalization Corporation of Japan (REVIC), etc. — — — — — — Equity, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,540 2,540 102 2,334 2,334 93 Securitization (as originating bank) . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — —
Rating-based approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Look-through approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — Risk weight = 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — —
Securitization (not as originating bank) . . . . . . . . . . . . . . . . . . . . . . . . . 6,077 6,434 257 5,545 6,101 244 Rating-based approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 389 166 7 241 201 8 Look-through approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,649 5,785 231 5,230 5,180 207 Risk weight = 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 483 19 56 695 28
Fund (look-through approach) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,144 1,525 61 1,657 1,791 72 Risk weight 0% to 20% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 0 0 20 4 0 Risk weight > 20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 323 131 5 501 171 7 Risk weight > 50% <= 100% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 403 392 16 624 402 16 Risk weight > 100% <= 150% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104 124 5 234 264 11 Risk weight > 150% < 1,250%. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 310 835 33 267 800 32 Risk weight = 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 43 2 12 151 6
Amount calculated by dividing equivalent CVA risk amount by 8% . . . . — 508 20 — 605 24 Central counterparty-related. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 825 33 1 187 7 0 Total of items included in risk weighted assets subject to phase-out arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 725 798 32 989 989 40 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,042 2,158 86 839 1,440 58 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48,003 34,387 1,375 51,947 34,182 1,367 Notes: 1. Amount of Exposure • After deducting the amount equivalent to partial direct write-offs (before applying credit risk mitigation effect). Specific allowance for loan-losses and allowance for loans to restructuring countries are not subject to the
deduction. • The amount is equivalent to credit extension set forth in the Notice (after the effect of deducting the amount
equivalent to credit extension under the close-out netting agreement). 2. Amount of Credit Risk • After applying credit risk mitigation effect. 3. Amount of Capital Requirements • As the standard approach and domestic standard are adopted by Aozora Bank, the amount is calculated
taking 4% of credit risk assets.
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076
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
(2) Amount of capital required to cover credit risk related to exposures for which credit risk assets are deemed applicable:
This information is described in Quantitative Disclosure 2. (1).
(Millions of Yen)
Sep. 2015 Sep. 2014
Consolidated Non-consolidated Consolidated Non-consolidated
Internal Models Approach . . . . . . . . 4,971 4,971 4,335 4,335
Standardized Approach . . . . . . . . . 1,430 1,411 1,486 1,485Interest Rate Risk . . . . . . . . . . . . 154 154 202 202Equity Risk . . . . . . . . . . . . . . . . . 2 2 61 61Foreign Exchange Risk . . . . . . . . 18 0 1 0Commodities Risk . . . . . . . . . . . . 1,254 1,254 1,220 1,220Options Transactions . . . . . . . . . . — — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . 6,401 6,382 5,822 5,821
Notes: The calculation methods are as follows: 1. Internal Models Approach General market risk for the interest rates, foreign exchange (major currencies), equity and CDS trading 2. Standardized Approach General market risk not applicable to the internal model and specific risk for CDS trading, etc.
(4) Amount of capital required to cover operational risk and amounts presented by each method:
This information is described in ‘Composition of Capital Disclosure.’
(5) Total capital requirements:
This information is described in ‘Composition of Capital Disclosure.’
(3) Amount of capital required to cover market risk and amounts presented by each method used:
Breakdown of Exposure by Area (Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Area Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Japan . . . . . . . . . . . . . . . . . . . . . . . . . . 27,026 3,231 1,426 31,684 29,658 5,625 682 35,966 Overseas . . . . . . . . . . . . . . . . . . . . . . . 10,062 5,368 889 16,318 8,936 5,906 1,139 15,982
Total . . . . . . . . . . . . . . . . . . . . . . . . . . 37,088 8,599 2,315 48,003 38,594 11,532 1,821 51,947
Notes: 1. Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above. 2. Disclosure of the average balance is not made because there is no significant difference between the average risk position of the exposure for the
term and the balance at the term-end.
3. Items pertaining to credit risk(1) Breakdown of term-end credit risk exposure balance by area, industry and residual period, as well as category:
Breakdown of Exposure by Area (Non-Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Area Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Japan . . . . . . . . . . . . . . . . . . . . . . . . . . 26,497 3,794 1,426 31,717 29,212 6,109 682 36,003 Overseas . . . . . . . . . . . . . . . . . . . . . . . 9,675 5,449 889 16,012 8,609 5,990 1,139 15,738
Total . . . . . . . . . . . . . . . . . . . . . . . . . . 36,171 9,243 2,315 47,730 37,821 12,099 1,821 51,741
Notes: 1. Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above. 2. Disclosure of the average balance is not made because there is no significant difference between the average risk position of the exposure for the
term and the balance at the term-end.
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077
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
Breakdown of Exposure by Industry Sector (Non-Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Industry sector Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Sovereign . . . . . . . . . . . . . . . . . . . . 6,481 4,468 1 10,950 7,120 7,279 2 14,401 Financial institution . . . . . . . . . . . . . 1,921 169 1,300 3,390 2,389 219 1,482 4,090 Manufacturer . . . . . . . . . . . . . . . . . 2,871 8 30 2,909 3,572 27 30 3,629 Agriculture/forestry/fisheries . . . . . . 29 — 0 30 33 — 0 33 Mining . . . . . . . . . . . . . . . . . . . . . . 140 20 0 160 174 — 0 174 Construction . . . . . . . . . . . . . . . . . . 210 — 1 211 295 — 0 295 Utilities (electric power/gas/ heat supply/water service) . . . . . . 834 — 17 851 661 — 7 669 Information & telecommunications . . 517 91 1 608 788 259 3 1,049 Transport . . . . . . . . . . . . . . . . . . . . 1,099 2 113 1,214 1,269 4 42 1,315 Wholesale/retail . . . . . . . . . . . . . . . 1,277 88 19 1,384 1,518 57 14 1,589 Other financial business (moneylending, leasing) . . . . . . . . 9,006 3,402 761 13,169 8,367 3,506 156 12,029 Real estate . . . . . . . . . . . . . . . . . . . 7,934 994 20 8,948 7,750 746 19 8,515 Various services (excluding leasing) . . . . . . . . . . . . 1,481 2 8 1,492 1,724 2 8 1,733 Others . . . . . . . . . . . . . . . . . . . . . . 2,371 — 42 2,414 2,161 — 58 2,219
Total . . . . . . . . . . . . . . . . . . . . . . . . 36,171 9,243 2,315 47,730 37,821 12,099 1,821 51,741
Note: Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above.
Breakdown of Exposure by Industry Sector (Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Industry sector Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Sovereign . . . . . . . . . . . . . . . . . . . . 6,494 4,470 1 10,965 7,120 7,282 2 14,404 Financial institution . . . . . . . . . . . . . 2,145 73 1,300 3,517 2,521 149 1,482 4,151 Manufacturer . . . . . . . . . . . . . . . . . 4,479 8 30 4,517 4,633 27 30 4,690 Agriculture/forestry/fisheries . . . . . . 32 — 0 32 35 — 0 35 Mining . . . . . . . . . . . . . . . . . . . . . . 250 20 0 270 255 — 0 255 Construction . . . . . . . . . . . . . . . . . . 210 — 1 211 295 — 0 295 Utilities (electric power/gas/ heat supply/water service) . . . . . . 951 — 17 968 757 — 7 764 Information & telecommunications . . 1,198 91 1 1,289 1,452 259 3 1,713 Transport . . . . . . . . . . . . . . . . . . . . 1,311 2 113 1,427 1,429 4 42 1,474 Wholesale/retail . . . . . . . . . . . . . . . 1,547 88 19 1,654 1,660 57 14 1,731 Other financial business (moneylending, leasing) . . . . . . . . 5,502 2,822 761 9,086 5,773 2,980 156 8,909 Real estate . . . . . . . . . . . . . . . . . . . 7,934 1,024 20 8,978 7,750 774 19 8,542 Various services (excluding leasing) . . . . . . . . . . . . 2,260 2 8 2,270 2,438 2 8 2,448 Others . . . . . . . . . . . . . . . . . . . . . . 2,776 — 42 2,819 2,478 — 58 2,535
Total . . . . . . . . . . . . . . . . . . . . . . . . 37,088 8,599 2,315 48,003 38,594 11,532 1,821 51,947
Note: Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above.
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078
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
(2) Balance of term-end exposures overdue three months or more and breakdown by area and industry:
Breakdown of Exposure by Residual Period (Non-Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Residual period Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
< 1 year . . . . . . . . . . . . . . . . . . . . 10,390 1,278 235 11,903 10,104 2,593 124 12,822 >= 1 year < 5 years . . . . . . . . . . . . . 12,743 1,034 552 14,329 13,968 2,110 283 16,361 >= 5 years . . . . . . . . . . . . . . . . . . . 13,038 6,931 1,528 21,498 13,749 7,395 1,414 22,558
Total . . . . . . . . . . . . . . . . . . . . . . 36,171 9,243 2,315 47,730 37,821 12,099 1,821 51,741
Notes: 1. Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above. 2. Exposures with a residual period => 5 years also include the transactions for which no maturity period is stipulated.
Breakdown of Exposure by Residual Period (Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Residual period Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
< 1 year . . . . . . . . . . . . . . . . . . . . 6,175 1,278 235 7,688 7,246 2,593 124 9,963 >= 1 year < 5 years . . . . . . . . . . . . . 12,721 1,034 552 14,307 13,975 2,110 283 16,368 >= 5 years . . . . . . . . . . . . . . . . . . . 18,192 6,287 1,528 26,008 17,374 6,828 1,414 25,616
Total . . . . . . . . . . . . . . . . . . . . . . 37,088 8,599 2,315 48,003 38,594 11,532 1,821 51,947
Notes: 1. Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above. 2. Exposures with a residual period => 5 years also include the transactions for which no maturity period is stipulated.
Breakdown of Exposure Overdue for Three Months or More by Area (Non-Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Area Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Japan . . . . . . . . . . . . . . . . . . . . . . 312 0 3 315 326 0 0 326 Overseas . . . . . . . . . . . . . . . . . . . 176 — — 176 213 — — 213
Total . . . . . . . . . . . . . . . . . . . . . . 488 0 3 491 539 0 0 539
Note: Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above.
Breakdown of Exposure Overdue for Three Months or More by Area (Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Area Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Japan . . . . . . . . . . . . . . . . . . . . . . 628 0 3 631 715 0 0 715 Overseas . . . . . . . . . . . . . . . . . . . 543 — — 543 429 — — 429
Total . . . . . . . . . . . . . . . . . . . . . . 1,171 0 3 1,174 1,144 0 0 1,144
Note: Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above.
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079
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
Breakdown of Exposure Overdue for Three Months or More by Industry Sector (Non-Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Industry sector Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Sovereign . . . . . . . . . . . . . . . . . . . . — — — — — — — — Financial institution . . . . . . . . . . . . . — — — — — — — — Manufacturer . . . . . . . . . . . . . . . . . 0 — 0 0 0 — 0 0 Agriculture/forestry/fisheries . . . . . . — — — — — — — — Mining . . . . . . . . . . . . . . . . . . . . . . 49 — — 49 22 — — 22 Construction . . . . . . . . . . . . . . . . . . 26 — — 26 26 — — 26 Utilities (electric power/gas/ heat supply/water service) . . . . . . — — — — — — — — Information & telecommunications . . — — — — 16 — — 16 Transport . . . . . . . . . . . . . . . . . . . . 127 — — 127 121 — — 121 Wholesale/retail . . . . . . . . . . . . . . . — — — — 60 — 0 60 Other financial business (moneylending, leasing) . . . . . . . . 241 — 3 244 247 — — 247 Real estate . . . . . . . . . . . . . . . . . . . 44 — — 44 44 — — 44 Various services (excluding leasing) . . . . . . . . . . . . — 0 — 0 0 0 — 0 Others . . . . . . . . . . . . . . . . . . . . . . 0 — — 0 3 — — 3
Total . . . . . . . . . . . . . . . . . . . . . . . . 488 0 3 491 539 0 0 539
Note: Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above.
Breakdown of Exposure Overdue for Three Months or More by Industry Sector (Consolidated) (100 Million Yen)
Sep. 2015 Sep. 2014
Industry sector Loans, etc. Securities Derivatives Total Loans, etc. Securities Derivatives Total
Sovereign . . . . . . . . . . . . . . . . . . . . — — — — — — — — Financial institution . . . . . . . . . . . . . — — — — — — — — Manufacturer . . . . . . . . . . . . . . . . . 161 — 0 161 65 — 0 66 Agriculture/forestry/fisheries . . . . . . 2 — — 2 2 — — 2 Mining . . . . . . . . . . . . . . . . . . . . . . 49 — — 49 38 — — 38 Construction . . . . . . . . . . . . . . . . . . 26 — — 26 26 — — 26 Utilities (electric power/gas/ heat supply/water service) . . . . . . — — — — — — — — Information & telecommunications . . 70 — — 70 54 — — 54 Transport . . . . . . . . . . . . . . . . . . . . 176 — — 176 128 — — 128 Wholesale/retail . . . . . . . . . . . . . . . 51 — — 51 125 — 0 125 Other financial business (moneylending, leasing) . . . . . . . . 241 — 3 244 371 — — 371 Real estate . . . . . . . . . . . . . . . . . . . 44 — — 44 44 — — 44 Various services (excluding leasing) . . . . . . . . . . . . 34 0 — 34 22 0 — 22 Others . . . . . . . . . . . . . . . . . . . . . . 316 — — 316 269 — — 269
Total . . . . . . . . . . . . . . . . . . . . . . . . 1,171 0 3 1,174 1,144 0 0 1,144
Note: Loans, etc. include on-balance and off-balance sheet exposures such as loans and commitment lines, other than securities and derivatives above.
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080
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
(3) Year-end balances and year on year changes for general allowance for loan losses, specific allowance for loan losses and country risk allowance
(100 Million Yen)
Area Sep. 2015 Sep. 2014 Mar. 2015 Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 531 449 537 434
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 148 87 211 Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 106 53 172 Overseas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 41 34 38
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 622 596 624 645
(100 Million Yen)
Area Sep. 2015 – Mar. 2015 Sep. 2014 – Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6) 15
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 (63) Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (33) (66) Overseas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 3
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2) (48)
Breakdown of Allowance by Area (Non-Consolidated)
(100 Million Yen)
Area Sep. 2015 Sep. 2014 Mar. 2015 Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 543 457 551 433
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 148 87 214 Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 106 53 172 Overseas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 42 34 42
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 635 606 637 647
(100 Million Yen)
Area Sep. 2015 – Mar. 2015 Sep. 2014 – Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7) 24
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 (66) Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (33) (66) Overseas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 (0)
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) (42)
Breakdown of Allowance by Area (Consolidated)
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081
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
Breakdown of Allowance by Industry Sector (Non-Consolidated)(100 Million Yen)
Area Sep. 2015 Sep. 2014 Mar. 2015 Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 531 449 537 434
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 148 87 211 Sovereign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Financial institution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Manufacturer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 15 17 15 Agriculture/forestry/fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Mining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 26 18 12 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Utilities (electric power/gas/heat supply/water service) . . . . . . . . . — — — — Information & telecommunications . . . . . . . . . . . . . . . . . . . . . . . . 1 1 1 1 Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 15 16 26 Wholesale/retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 11 10 16 Other financial business (moneylending, leasing) . . . . . . . . . . . . . . 1 48 2 50 Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 29 22 87 Various services (excluding leasing) . . . . . . . . . . . . . . . . . . . . . . . . 0 — 0 — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 3 1 4
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 622 596 624 645
(100 Million Yen)
Area Sep. 2015 – Mar. 2015 Sep. 2014 – Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6) 15
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 (63) Sovereign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Financial institution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Manufacturer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9) (0) Agriculture/forestry/fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Mining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 14 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Utilities (electric power/gas/heat supply/water service) . . . . . . . . . — — Information & telecommunications . . . . . . . . . . . . . . . . . . . . . . . . — (1) Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 (11) Wholesale/retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4) (5) Other financial business (moneylending, leasing) . . . . . . . . . . . . . . (0) (3) Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (19) (58) Various services (excluding leasing) . . . . . . . . . . . . . . . . . . . . . . . . — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0) (0)
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2) (48)
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082
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
(100 Million Yen)
Area Sep. 2015 Sep. 2014 Mar. 2015 Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 543 457 551 433
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 148 87 214 Sovereign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Financial institution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Manufacturer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 15 17 15 Agriculture/forestry/fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Mining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 26 18 15 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Utilities (electric power/gas/heat supply/water service) . . . . . . . . . — — — — Information & telecommunications . . . . . . . . . . . . . . . . . . . . . . . . 1 1 1 1 Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 15 16 26 Wholesale/retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 11 10 16 Other financial business (moneylending, leasing) . . . . . . . . . . . . . . 1 48 2 50 Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 29 22 87 Various services (excluding leasing) . . . . . . . . . . . . . . . . . . . . . . . . 0 — 0 — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 3 1 4
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 635 606 637 647
Breakdown of Allowance by Industry Sector (Consolidated)
(100 Million Yen)
Industry sector Sep. 2015 Sep. 2014 Mar. 2015
Sovereign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Financial institution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Manufacturer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0 0 Agriculture/forestry/fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Mining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Utilities (electric power/gas/heat supply/water service) . . . . . . . . . . . . . . — 0 0 Information & telecommunications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 0 0 Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 7 6 Wholesale/retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 2 Other financial business (moneylending, leasing) . . . . . . . . . . . . . . . . . . . — — 0 Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Various services (excluding leasing) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0 0 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 0
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 7 9
(4) Breakdown of Write-Offs by Industry Sector (Non-Consolidated)
Note: The table shows the breakdown of the write-off of loans in the Statement of Operations.
(100 Million Yen)
Area Sep. 2015 – Mar. 2015 Sep. 2014 – Mar. 2014
General allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7) 24
Specific allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 (66) Sovereign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Financial institution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Manufacturer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9) (0) Agriculture/forestry/fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Mining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 11 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Utilities (electric power/gas/heat supply/water service) . . . . . . . . . — — Information & telecommunications . . . . . . . . . . . . . . . . . . . . . . . . — (0) Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 (11) Wholesale/retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4) (5) Other financial business (moneylending, leasing) . . . . . . . . . . . . . . (0) (3) Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (19) (58) Various services (excluding leasing) . . . . . . . . . . . . . . . . . . . . . . . . — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0) (0)
Allowance for loans to restructuring countries . . . . . . . . . . . . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) (42)
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083
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
(5) Outstanding Exposure after Recognizing Credit Risk Mitigations by Risk Weight (Non-Consolidated)
(100 Million Yen)
Industry sector Sep. 2015 Sep. 2014 Mar. 2015
Sovereign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Financial institution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Manufacturer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0 0 Agriculture/forestry/fisheries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Mining . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Utilities (electric power/gas/heat supply/water service) . . . . . . . . . . . . . . — 0 —Information & telecommunications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0 0 Transport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 7 —Wholesale/retail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 2 Other financial business (moneylending, leasing) . . . . . . . . . . . . . . . . . . . — — —Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Various services (excluding leasing) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 0 0 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 (5) 4
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 2 6
Breakdown of Write-Offs by Industry Sector (Consolidated)
Notes: 1. The table shows the breakdown of the write-off of loans in the Statement of Operations. 2. The ‘Write-offs’ include write-offs made by AOZORA Loan Services Co., Ltd., which are shown on the ‘Others’ line.
(100 Million Yen)
Sep. 2015 Sep. 2014
Amount of exposure Amount of exposure
Risk weightApplication of external rating
Application of external rating
0% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,687 2,596 13,786 3,385 > 0% <= 10% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,190 — 794 — > 10% <= 20% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,926 3,903 4,690 4,567 > 20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,610 2,222 3,327 2,763 > 50% <= 75% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 18 524 16 > 75% <= 100% . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,424 3,221 23,392 3,848 > 100% <= 150% . . . . . . . . . . . . . . . . . . . . . . . . . . 4,330 242 4,104 314 > 150% < 1,250% . . . . . . . . . . . . . . . . . . . . . . . . 1,084 — 680 — 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 0 71 3
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,319 12,202 51,369 14,897
Note: In the ‘Application of external rating’ section, the exposures to which an external rating is applied in the calculation of risk weight are included.
(100 Million Yen)
Sep. 2015 Sep. 2014
Amount of exposure Amount of exposure
Risk weightApplication of external rating
Application of external rating
0% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,703 2,596 13,789 3,385 > 0% <= 10% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,190 — 794 — > 10% <= 20% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,372 4,349 5,030 4,907 > 20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,609 2,222 3,343 2,785 > 50% <= 75% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 18 523 16 > 75% <= 100% . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,701 5,544 25,589 5,740 > 100% <= 150% . . . . . . . . . . . . . . . . . . . . . . . . . . 1,894 601 1,746 510 > 150% < 1,250% . . . . . . . . . . . . . . . . . . . . . . . . 1,057 — 689 16 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 0 71 3
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,592 15,331 51,575 17,363
Note: In the ‘Application of external rating’ section, the exposures to which an external rating is applied in the calculation of risk weight are included.
Outstanding Exposure after Recognizing Credit Risk Mitigations by Risk Weight (Consolidated)
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084
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
4. Items pertaining to credit risk mitigation techniques
Breakdown of Exposure for which Credit Risk Mitigations Are Applied (Non-Consolidated) (100 Million Yen)
Credit risk mitigation Sep. 2015 Sep. 2014
Eligible financial collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 402 321 Cash and deposits at Aozora . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 317 243 Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 57 Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 22 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Guarantees and credit derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 944 1,432 Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 944 1,432 Credit derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,346 1,753
Note: The exposure above does not include the amount for which a credit risk mitigation is recognized through netting between loans and deposits at the Bank under the netting agreement (Provision 117 of the Notice).
Breakdown of Exposure for which Credit Risk Mitigations Are Applied (Consolidated) (100 Million Yen)
Credit risk mitigation Sep. 2015 Sep. 2014
Eligible financial collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 402 321 Cash and deposits at Aozora . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 317 243 Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 57 Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 22 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Guarantees and credit derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 999 1,519 Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 999 1,519 Credit derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,401 1,840
Note: The exposure above does not include the amount for which a credit risk mitigation is recognized through netting between loans and deposits at the Bank under the netting agreement (Provision 117 of the Notice).
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085
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
5. Items pertaining to counterparty risk on derivative transactions and long-settlement transactions
Breakdown of Derivative Transactions and Long-settlement Transactions (Non-Consolidated) (100 Million Yen)
Type of transaction
Sep. 2015 Sep. 2014
Gross replacement
costGross
add-on
Credit-equivalent
amount
Gross replacement
costGross
add-on
Credit-equivalent
amount
Gross credit-equivalent amount (before credit risk mitigating effect is recognized) . . . . . 2,490 1,913 4,404 3,208 1,910 5,117 Derivative transactions . . . . . . . . . . . . . . . . . . . . . . . . 2,490 1,913 4,404 3,207 1,909 5,116 Forex and gold-related . . . . . . . . . . . . . . . . . . . . . . 191 221 412 122 170 291 Interest rate-related . . . . . . . . . . . . . . . . . . . . . . . . . 2,183 1,416 3,598 3,059 1,524 4,583 Equity-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 77 90 1 35 37 Precious metal-related (excluding gold-related) . . . . — — — — — — Other commodity-related . . . . . . . . . . . . . . . . . . . . . 88 73 161 8 77 85 Credit derivatives (counterparty risk) . . . . . . . . . . . . 15 127 142 18 102 119 Long-settlement transactions . . . . . . . . . . . . . . . . . . . — — — 0 1 1 Credit-equivalent amount reduction effect through close-out netting agreement . . . . . . . . . . . . . . . . . . . . . (1,535) (553) (2,088) (2,506) (789) (3,295)Net credit-equivalent amount (before credit risk mitigating effect is recognized) . . . . . 2,315 1,822 Eligible financial collateral associated . . . . . . . . . . . . . . . 351 255 Cash and deposits at Aozora . . . . . . . . . . . . . . . . . . . 293 208 Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 47
Net credit-equivalent amount (after credit risk mitigating effect is recognized) . . . . 1,964 1,568
Note: The credit-equivalent amount is calculated by applying the current-exposure method.
Breakdown of Derivative Transactions and Long-settlement Transactions (Consolidated) (100 Million Yen)
Type of transaction
Sep. 2015 Sep. 2014
Gross replacement
costGross
add-on
Credit-equivalent
amount
Gross replacement
costGross
add-on
Credit-equivalent
amount
Gross credit-equivalent amount (before credit risk mitigating effect is recognized) . . . . . 2,490 1,913 4,404 3,208 1,910 5,117 Derivative transactions . . . . . . . . . . . . . . . . . . . . . . . . 2,490 1,913 4,404 3,207 1,909 5,116 Forex and gold-related . . . . . . . . . . . . . . . . . . . . . . 191 221 412 122 170 291 Interest rate-related . . . . . . . . . . . . . . . . . . . . . . . . . 2,183 1,416 3,598 3,059 1,524 4,583 Equity-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 77 90 1 35 37 Precious metal-related (excluding gold-related) . . . . — — — — — — Other commodity-related . . . . . . . . . . . . . . . . . . . . . 88 73 161 8 77 85 Credit derivatives (counterparty risk) . . . . . . . . . . . . 15 127 142 18 102 119 Long-settlement transactions . . . . . . . . . . . . . . . . . . . — — — 0 1 1 Credit-equivalent amount reduction effect through close-out netting agreement . . . . . . . . . . . . . . . . . . . . . (1,535) (553) (2,088) (2,506) (789) (3,295) Net credit-equivalent amount (before credit risk mitigating effect is recognized) . . . . . 2,315 1,822 Eligible financial collateral associated . . . . . . . . . . . . . . . 351 255 Cash and deposits at Aozora . . . . . . . . . . . . . . . . . . . 293 208 Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 47
Net credit-equivalent amount (after credit risk mitigating effect is recognized) . . . . 1,964 1,568
Note: The credit-equivalent amount is calculated by applying the current-exposure method.
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086
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Breakdown of Credit Derivative Transactions (Non-Consolidated) (100 Million Yen)
Type of transactionPurchase or supply
of guarantee
Sep. 2015 Sep. 2014
Notional principal Notional principal
Transactions subject to the calculation of credit equivalent amount . . . . . . . 2,448 1,866 Credit derivatives (credit reference asset of single organization). . . . . . . . . . Purchase 1,223 909
Supply 1,225 957 First-to-default type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Purchase — —
Supply — — Second-to-default type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Purchase — —
Supply — — Transactions not subject to the calculation of credit-equivalent amount . . . Purchase — — Note: The amount used in order to recognize the effect of credit risk mitigation is provided in the transactions not subject to the calculation of credit-
equivalent amount.
Breakdown of Credit Derivative Transactions (Consolidated) (100 Million Yen)
Type of transactionPurchase or supply
of guarantee
Sep. 2015 Sep. 2014
Notional principal Notional principal
Transactions subject to the calculation of credit equivalent amount . . . . . . . 2,448 1,866 Credit derivatives (credit reference asset of single organization). . . . . . . . . . Purchase 1,223 909
Supply 1,225 957 First-to-default type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Purchase — —
Supply — — Second-to-default type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Purchase — —
Supply — — Transactions not subject to the calculation of credit-equivalent amount . . . Purchase — — Note: The amount used in order to recognize the effect of credit risk mitigation is provided in the transactions not subject to the calculation of credit-
equivalent amount.
6. Items pertaining to securitization transactions
(1) Securitization Transactions Originated by Aozora Group As of end-September 2014 and end-September 2015, there were no securitization transactions originated by Aozora Group.
(2) Securitization Transactions in which Aozora Group Invests
(100 Million Yen)
Category of underlying assets
Sep. 2015
Securitization exposure Resecuritization exposure Total
On-Balance Off-Balance On-Balance Off-Balance On-Balance Off-Balance
Project finance . . . . . . . . . . . . . . . . . . . . . . . . 506 267 — — 506 267 Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233 — — — 233 — Claims on corporations . . . . . . . . . . . . . . . . . . 9 34 0 — 9 34 Residential loan receivables . . . . . . . . . . . . . . 6 59 — — 6 59 Ships/aircraft . . . . . . . . . . . . . . . . . . . . . . . . . 45 — — — 45 — Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,857 77 0 — 3,857 77 Non-performing loans . . . . . . . . . . . . . . . . . . . 449 2 143 — 592 2 Lease receivables . . . . . . . . . . . . . . . . . . . . . . 42 — — — 42 — Consumer loan receivables . . . . . . . . . . . . . . . 127 40 — — 127 40 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 — 0 — 7 —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,281 480 143 — 5,424 480
Securitization Exposure Held by the Group (Non-Consolidated)
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087
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
(100 Million Yen)
Category of underlying assets
Sep. 2014
Securitization exposure Resecuritization exposure Total
On-Balance Off-Balance On-Balance Off-Balance On-Balance Off-Balance
Project finance . . . . . . . . . . . . . . . . . . . . . . . . 397 209 — — 397 209 Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 407 — — — 407 — Claims on corporations . . . . . . . . . . . . . . . . . . 11 37 0 — 11 37 Residential loan receivables . . . . . . . . . . . . . . 12 55 — — 12 55 Ships/aircraft . . . . . . . . . . . . . . . . . . . . . . . . . 80 4 — — 80 4 Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,541 70 26 — 3,567 70 Non-performing loans . . . . . . . . . . . . . . . . . . . 468 — — — 468 — Lease receivables . . . . . . . . . . . . . . . . . . . . . . 35 — — — 35 — Consumer loan receivables . . . . . . . . . . . . . . . 69 — — — 69 — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 — 0 — 11 —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,032 375 26 — 5,058 375
(100 Million Yen)
Category of underlying assets
Sep. 2015
Securitization exposure Resecuritization exposure Total
On-Balance Off-Balance On-Balance Off-Balance On-Balance Off-Balance
Project finance . . . . . . . . . . . . . . . . . . . . . . . . 506 291 — — 506 291 Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233 — — — 233 — Claims on corporations . . . . . . . . . . . . . . . . . . 129 34 0 — 129 34 Residential loan receivables . . . . . . . . . . . . . . 6 59 — — 6 59 Ships/aircraft . . . . . . . . . . . . . . . . . . . . . . . . . 45 — — — 45 — Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,887 77 0 — 3,887 77 Non-performing loans . . . . . . . . . . . . . . . . . . . 449 2 143 — 592 2 Lease receivables . . . . . . . . . . . . . . . . . . . . . . 42 — — — 42 — Consumer loan receivables . . . . . . . . . . . . . . . 127 40 — — 127 40 Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 — 0 — 7 —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,430 504 143 — 5,573 504
Securitization Exposure Held by the Group (Consolidated)
(100 Million Yen)
Category of underlying assets
Sep. 2014
Securitization exposure Resecuritization exposure Total
On-Balance Off-Balance On-Balance Off-Balance On-Balance Off-Balance
Project finance . . . . . . . . . . . . . . . . . . . . . . . . 414 209 — — 414 209 Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 407 — — — 407 — Claims on corporations . . . . . . . . . . . . . . . . . . 62 37 0 — 62 37 Residential loan receivables . . . . . . . . . . . . . . 12 55 — — 12 55 Ships/aircraft . . . . . . . . . . . . . . . . . . . . . . . . . 80 4 — — 80 4 Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,568 70 26 — 3,594 70 Non-performing loans . . . . . . . . . . . . . . . . . . . 468 — — — 468 — Lease receivables . . . . . . . . . . . . . . . . . . . . . . 35 — — — 35 — Consumer loan receivables . . . . . . . . . . . . . . . 69 — — — 69 — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 — 0 — 11 —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,127 375 26 — 5,153 375
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088
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
(100 Million Yen)
Risk weight
Sep. 2015
Securitization exposure Resecuritization exposure
On-Balance Off-Balance On-Balance Off-Balance
OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement
0% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — >0% <= 20% . . . . . . . . . . . . . . . . . . . . . . . . . 300 2 108 1 — — — — >20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . 60 1 40 1 — — — — >50% <= 100% . . . . . . . . . . . . . . . . . . . . . . . 4,578 183 353 14 — — — — >100% <= 350% . . . . . . . . . . . . . . . . . . . . . . 453 27 2 0 143 9 — — >350 < 1,250% . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 19 — — 0 0 — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,430 233 504 16 143 9 — —
(100 Million Yen)
Risk weight
Sep. 2014
Securitization exposure Resecuritization exposure
On-Balance Off-Balance On-Balance Off-Balance
OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement
0% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — >0% <= 20% . . . . . . . . . . . . . . . . . . . . . . . . . 141 1 — — — — — — >20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . 104 1 172 2 — — — — >50% <= 100% . . . . . . . . . . . . . . . . . . . . . . . 4,332 169 203 8 26 1 — — >100% <= 350% . . . . . . . . . . . . . . . . . . . . . . 490 31 — — — — — — >350 < 1,250% . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59 29 — — 0 0 — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,127 232 375 10 26 1 — —
Outstanding Securitization Exposure by Risk Weight and Capital Requirement Thereof (Consolidated)
(100 Million Yen)
Risk weight
Sep. 2015
Securitization exposure Resecuritization exposure
On-Balance Off-Balance On-Balance Off-Balance
OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement
0% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — >0% <= 20% . . . . . . . . . . . . . . . . . . . . . . . . . 151 1 108 1 — — — — >20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . 60 1 40 1 — — — — >50% <= 100% . . . . . . . . . . . . . . . . . . . . . . . 4,578 183 329 13 — — — — >100% <= 350% . . . . . . . . . . . . . . . . . . . . . . 453 27 2 0 143 9 — — >350 < 1,250% . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 19 — — 0 0 — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,281 232 480 15 143 9 — —
(100 Million Yen)
Risk weight
Sep. 2014
Securitization exposure Resecuritization exposure
On-Balance Off-Balance On-Balance Off-Balance
OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement OutstandingCapital
requirement
0% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — >0% <= 20% . . . . . . . . . . . . . . . . . . . . . . . . . 63 1 — — — — — — >20% <= 50% . . . . . . . . . . . . . . . . . . . . . . . . 104 1 172 2 — — — — >50% <= 100% . . . . . . . . . . . . . . . . . . . . . . . 4,332 169 203 8 26 1 — — >100% <= 350% . . . . . . . . . . . . . . . . . . . . . . 474 29 — — — — — — >350 < 1,250% . . . . . . . . . . . . . . . . . . . . . . — — — — — — — — 1,250% . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59 29 — — 0 0 — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,032 229 375 10 26 1 — —
Outstanding Securitization Exposure by Risk Weight and Capital Requirement Thereof (Non-Consolidated)
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089
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
(100 Million Yen)
Category of underlying assetsSep. 2015 Sep. 2014
Amount of exposure Amount of exposure
Project finance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 1 Claims on corporations . . . . . . . . . . . . . . . . . . . . . . . 0 0 Residential loan receivables . . . . . . . . . . . . . . . . . . . — — Ships/aircraft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 58 Non-performing loans . . . . . . . . . . . . . . . . . . . . . . . . — — Lease receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Consumer loan receivables . . . . . . . . . . . . . . . . . . . . — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 59
(100 Million Yen)
Category of underlying assetsSep. 2015 Sep. 2014
Amount of exposure Amount of exposure
Project finance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 1 Claims on corporations . . . . . . . . . . . . . . . . . . . . . . . 0 0 Residential loan receivables . . . . . . . . . . . . . . . . . . . — — Ships/aircraft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 58 Non-performing loans . . . . . . . . . . . . . . . . . . . . . . . . — — Lease receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Consumer loan receivables . . . . . . . . . . . . . . . . . . . . — — Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 59
Securitization Exposure Calculated By Risk Weight of 1,250% (Non-Consolidated)
Securitization Exposure Calculated By Risk Weight of 1,250% (Consolidated)
Presence/Absence of Method Applied to Reduce Credit Risk to Resecuritization Exposures in which Aozora Group Invests and Breakdown of Risk-Weight Categories Applied to GuarantorsAs of end-September 2014 and end-September 2015, there were no resecuritization exposures to which methods to reduce credit risk have been applied.
(3) Securitization exposure originated by Aozora Group that is subject to the calculation of the market risk amountThere was no securitization exposure originated by Aozora Group that was subject to the calculation of the market risk amount as of end-September 2014 and end-September 2015.
(4) Securitization exposure in which Aozora Group invests that is subject to the calculation of the market risk amount
There was no securitization exposure in which Aozora Group invested that was subject to the calculation of the market risk amount as of end-September 2014 and end-September 2015.
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090
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
(100 Million Yen)
Sep. 2015
Average Maximum Minimum As of Sep. 2015
Trading . . . . . . . . . . . . . 3 4 1 2Banking . . . . . . . . . . . . 54 63 45 48
(100 Million Yen)
Sep. 2014
Average Maximum Minimum As of Sep. 2014
Trading . . . . . . . . . . . . . 2 4 1 2Banking . . . . . . . . . . . . 53 61 45 46
2. The highest, lowest and average VaR number during the disclosure period
(100 Million Yen)
Sep. 2015
Average Maximum Minimum As of Sep. 2015
8 12 3 4
(100 Million Yen)
Sep. 2014
Average Maximum Minimum As of Sep. 2014
6 9 4 5
(2) The stressed Value at Risk (stressed VaR) number at term-end and the highest, lowest and average stressed VaR number during the disclosure period
(3) Amount of required capital for additional and comprehensive risk at term-end and the highest, lowest and average capital requirements during the disclosure period
There was no applicable required capital amount as of end-September 2014 and end-September 2015.
(100 Million Yen)
Sep. 2015
Interest rate Equity Forex Others Total
Trading . . . . . . . . . . . 1 0 0 0 2Banking . . . . . . . . . . 34 19 3 19 48
Total . . . . . . . . . . . . 35 19 3 19 49
(100 Million Yen)
Sep. 2014
Interest rate Equity Forex Others Total
Trading . . . . . . . . . . . 1 1 0 0 2Banking . . . . . . . . . . 40 20 3 17 46
Total . . . . . . . . . . . . 41 22 4 17 48
1. The Value at Risk (VaR ) number at term-endMarket risk for the entire bank
Notes: 1. ‘Others’ includes hedge funds and credit derivatives, etc. 2. The above figures are based on a 1-day holding period and a 99% confidence level. 3. The figures for total VaR do not represent the sum of individual components, due to correlations.
7. Items pertaining to market risk(1) The Value at Risk (VaR) number at term-end as well as the highest, lowest and average VaR numbers during
the disclosure period
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091
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
Disclosure Based on Basel III Capital Accord Pillar III—Market Discipline
(4) Back-testing results and explanations in the event actual losses strayed significantly downward from VaR numbers
The following graph represents the results of the back testing for trading businesses with internal models over the 244 business days from October 1, 2014 to September 30, 2015. As a result of the back testing, by comparing 1-day holding VaR to daily hypothetical P/L, the daily losses exceeded daily VaR on one business day. This result supports the reliability of the Bank’s VaR.
(1) Balance sheet amount (Millions of Yen)
Sep. 30, 2015 Sep. 30, 2014
Non-consolidated Consolidated Non-consolidated Consolidated
Balance sheet amount . . . . . . . . . . . . . . . . . . . . . 299,682 272,872 266,373 239,863 Listed stock exposures . . . . . . . . . . . . . . . . . . . 272,368 272,369 215,351 215,351 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,313 503 51,022 24,512
(2) Gains and losses on sales, and write-offs of equity exposure (Millions of Yen)
1H of FY2015 1H of FY2014
Non-consolidated Consolidated Non-consolidated Consolidated
Gains on sales . . . . . . . . . . . . . . . . . . . . . . . . . . . 636 636 1,037 1,037 Losses on sales . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — Write-off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — —
8. Items pertaining to equity exposures in the banking book
(Millions of Yen)
Sep. 30, 2015 Sep. 30, 2014
Non-consolidated Consolidated Non-consolidated Consolidated
Unrealized gains (losses) . . . . . . . . . . . . . . . . . . . . 21,213 21,213 6,621 6,621
(3) Unrealized gains/losses recognized on the balance sheet but not recognized on the statement of income
(4) Unrealized gains/losses not recognized on the balance sheet or the statement of income(As of end-September 2015 and end-September 2014)Consolidated: Not applicableNon-consolidated: Not applicable
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092
Financial and C
orporate Data
Disclosure B
ased on Basel III
Capital A
ccord Pillar III—
Market D
iscipline
(100 Million Yen, %)
Sep. 2015 Sep. 2014
P/L Impact of Interest Rate Shock . . . . . . . . . . . . . . 202 284Outlier Ratio (Ratio to Regulatory Capital) . . . . . . . . . 5.0 5.2
Note: Interest rate shock is defined as the figure of 99th percentiles on the interest rate movement distribution based on a 1-year holding period observed during the past 5 years.
Interest rate risk in the banking book
10. Losses on interest rate shocks based on internal measures for interest rate risk related to the banking book, and changes in economic prices
9. Amount of exposures held in fundsThis item is described in Quantitative Disclosure 2. (1) above.
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093
Financial and C
orporate Data
Share P
rocedure Information
Share Procedure Information
● Fiscal year From April 1 to March 31
● Ordinary general shareholders’ meeting Held in June
● Record date for determination of dividends March 31, June 30, September 30 and December 31
● Record date Ordinary General Shareholders’ Meeting: March 31 (also to be held in other cases as deemed necessary, whereby the record date will be set and advance notice given).
● Public notifications Electronic public notice via the Internet. In the event that public notice cannot be made via the Internet, the Nihon Keizai Shimbun will be used.
● Listed on The First Section of the Tokyo Stock Exchange
● Securities code 8304
● Number of shares 1,000 shares constituting one unit (tangen)
● Manager of register of shareholders Sumitomo Mitsui Trust Bank, Limited and administrator of the ‘special account’ 4-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo
● Manager of register of shareholders’ location Stock Transfer Agency Business Planning Dept., Sumitomo Mitsui Trust Bank, Limited 4-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo
(Mailing address) Stock Transfer Agency Business Planning Dept., Sumitomo Mitsui Trust Bank, Limited 8-4, Izumi 2-chome, Suginami-ku, Tokyo, 168-0063
(Contact number) 0120-782-031 (toll free only if calling from Japan)
● Inquiries regarding shares and notification of changesWe ask that shareholders direct all inquiries, including change of address, to their securities company. For those shareholders who do not have an account with a securities firm, inquiries should be directed to the agent above.
● Regarding the ‘special account’Prior to the implementation of the electronic share certificate system in Japan, an account was established with Sumitomo Mitsui Trust Bank, Limited, for shareholders who did not use JASDEC’s hofuri system. Such shareholders should direct all matters related to change of address and other inquiries to the agent above.
(As of January 1, 2016)
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