77 Bank, Ltd. · TSE:8341

77 Bank — The 77 Bank — H1 FY2020 Earnings Presentation

42 slides from 77 Bank's earnings presentation, Dec 3, 2019

  1. Slide 1: IR Presentation: Results for the First Half of FY Ending March 2020

    IR Presentation Results for the First Half of Fiscal Year Ending March 31, 2020 December 3, 2019 Materials were prepared for the Bank’s presentation of its results for the first half of fiscal year ending March 31, 2020 held on December 3, 2019.

  2. Slide 2: Contents

    First Half of Fiscal Year Contents Ending March 31, 2020 I. Financial Summary II. Management Strategy □ Summary of profits and losses ３ □ Potential of Miyagi Prefecture 17 □ Interest income ４ □ Growth Strategy □ Deposits/Loans and bills discounted ５ ・Strengthening consulting capabilities 18 □ Securi

  3. Slide 3: I. Financial Summary

    I. Financial Summary For The Customer C&O For The Future RAR AY EIT YIN CCRT 2 TI BANK

  4. Slide 4: Summary of profits and losses

    First Half of Fiscal Year I. Financial Summary Summary of profits and losses Ending March 31, 2020 (JPY bn, %) YoY change Summary of profits and losses 1H 1H Increase/ Rate of <Core operating income> (Non-consolidated) FY2019 FY2020 decrease change % Core operating income increased Gross operating i

  5. Slide 5: Interest income

    First Half of Fiscal Year I. Financial Summary Interest income Ending March 31, 2020 (JPY bn) <1H FY2020 summary> 1H 1H FY2019 FY2020 YoY change Interest income increased JPY 2.5 billion year-on-year due to an increase in interest and dividends on securities and a decrease in Interest income 33.9 36

  6. Slide 6: Deposits/Loans and bills discounted

    First Half of Fiscal Year I. Financial Summary Deposits/Loans and bills discounted Ending March 31, 2020 (JPY bn, %) <1H FY2020 summary> 1H 1H FY2019 FY2020 YoY change The total amount of deposits and certificates of deposits decreased mainly because of a decrease in public deposits. Deposits and ce

  7. Slide 7: Loans and bills discounted

    First Half of Fiscal Year I. Financial Summary Loans and bills discounted Ending March 31, 2020 Corporate loans (yen-denominated, at term-end) Outstanding balance and executed amount of apartment loans Miyagi Pref. Tohoku region, etc. (excl. Miyagi Pref.) Tokyo/Nagoya/Osaka Balance of loans Executed

  8. Slide 8: Securities (1)

    First Half of Fiscal Year I. Financial Summary Securities (1) Ending March 31, 2020 Balance of marketable securities (on an amortized cost base) <1H FY2020 summary> National gov. bonds Local gov. bonds Corporate bonds Others (JPY bn) Stocks Public, etc. Balance of Balance of marketable securities de

  9. Slide 9: Securities (2)

    First Half of Fiscal Year I. Financial Summary Securities (2) Ending March 31, 2020 Gains (losses) from evaluation of securities <1H FY2020 summary> National gov. bonds Local gov. bonds Corporate bonds Others Gains (losses) from evaluation of securities increased JPY (JPY bn) Stocks Gains (losses) f

  10. Slide 10: Fees and commissions

    First Half of Fiscal Year I. Financial Summary Fees and commissions Ending March 31, 2020 Fees and commissions from corporate clients <1H FY2020 summary> Manager insurance Privately placed corporate bonds M&A Business matching Syndicated loans, commitment lines Fees and commissions decreased JPY 0.2

  11. Slide 11: Assets in custody

    First Half of Fiscal Year I. Financial Summary Assets in custody Ending March 31, 2020 <1H FY2020 summary> Insurance sales decreased JPY 4.8 billion year-on-year due to the effect of sales suspension of some products, while structured bond sales increased JPY 5.1 billion because of promotion to clie

  12. Slide 12: Credit-related expenses/reserve for possible loan losses

    Credit-related expenses/reserve for possible loan losses/credits First Half of Fiscal Year I. Financial Summary disclosed under the Financial Reconstruction Law Ending March 31, 2020 <1H FY2020 summary> A decreased reserve rate resulted in reversal of general reserve for possible loan losses. On the

  13. Slide 13: Progress of the Medium-term Management Plan

    First Half of Fiscal Year I. Financial Summary Progress of the Medium-term Management Plan Ending March 31, 2020 1. Targets (JPY bn, %) Item FY2018 results FY2019 results 1H FY2020 results FY2021 targets ・Net income (consolidated) JPY 18.3 bn JPY 17.6 bn JPY 11.3 bn JPY 19.0 bn or more ・Interest on

  14. Slide 14: Projected performance for FY2020

    First Half of Fiscal Year I. Financial Summary Projected performance for FY2020 Ending March 31, 2020 (JPY bn) Summary of profits and losses FY2019 FY2020 YoY (Non-consolidated) (Results) (Plan) change (%) Gross operating incom e 69.2 71.5 2.3 Interest rates/ FY2019 FY2020 [Core gross operating inco

  15. Slide 15: Quantitative plan (1)

    I. Financial Summary Quantitative plan (1) First Half of Fiscal Year Ending March 31, 2020 1. Major accounts (average balance) (JPY bn) FY2018 FY2019 FY2020 (Results) (Results) 1H Results (Plan) Loans and bills discounted 4,494.0 4,662.3 4,702.3 4,743.7 Corporate loans 2,789.7 2,886.3 2,904.9 2,951.

  16. Slide 16: Quantitative plan (2)

    I. Financial Summary Quantitative plan (2) First Half of Fiscal Year Ending March 31, 2020 3. Profits and losses (JPY bn, %) FY2018 FY2019 FY2020 (Results) (Results) 1H Results (Plan) Core gross operating income 75.9 72.0 38.9 73.5 Interst income 69.6 65.9 36.4 67.4 Non-consolidated Interest on loan

  17. Slide 17: II. Management Strategy

    ll. Management Strategy For The Customer C&O For The Future AAR AY EWF YIN CCRT 16 TI BANK

  18. Slide 18: Potential of Miyagi Prefecture

    First Half of Fiscal Year II. Management Strategy Potential of Miyagi Prefecture Ending March 31, 2020 Industrial activity development Increase in visitors ● Expansion of manufacturing industry has created new jobs and grown ● The number of visitors to Miyagi Prefecture was 64.14 million people (pre

  19. Slide 19: Strengthening consulting capabilities

    First Half of Fiscal Year II. Management Strategy Strengthening consulting capabilities Ending March 31, 2020 Bank image sought by The 77 Bank “Best Consulting Bank” that responds to customers’ needs by offering the optimum solutions Initiatives to Consulting approach targeted by The 77 Bank realize

  20. Slide 20: HR development

    First Half of Fiscal Year II. Management Strategy HR development Ending March 31, 2020 Basic approach to human Strengthening consulting capabilities resource development OJT at the workplace forms the basis for human (Improving the skills and skill levels) resource development. Our basic approach to

  21. Slide 21: Business evaluations

    First Half of Fiscal Year II. Management Strategy Business evaluations Ending March 31, 2020 External support The 77 Bank Group Clients organizations Cultivate and capture Development Bank of Japan diverse customer Issues for enhancement of corporate value 77 Card 77 Bank Japan Finance Corporation n

  22. Slide 22: Business matching

    First Half of Fiscal Year II. Management Strategy Business matching Ending March 31, 2020 (JPY mn) 150 Number of business matching partners 600 Number of business matching service 350 Business matching fees and commissions contracts closed 300 500 120 250 400 90 200 300 150 60 109 120 434 200 240 24

  23. Slide 23: Business succession

    First Half of Fiscal Year II. Management Strategy Business succession Ending March 31, 2020 Number of business succession support cases Number of inheritance and asset succession support recipients Will trust Referral of external experts Estate liquidation/Inheritance trouble support services 600 In

  24. Slide 24: M&A

    First Half of Fiscal Year II. Management Strategy M&A Ending March 31, 2020 (JPY mn) 30 Number of M&A advisory contract clients 300 M&A fees and commissions Number of M&A issue resolution measures shared/agreed in business evaluation (As of end-Sep. 2019) 20 200 Issue resolution measures shared Issu

  25. Slide 25: Overseas business

    First Half of Fiscal Year II. Management Strategy Overseas business Ending March 31, 2020 〇Example of collaboration with Bangkok Bank and Japan Bank <Business network in Asia> for International Cooperation (JBIC) 【China】 (Process for lending capital investment funds to a local Thai company) Domestic

  26. Slide 26: Integrated financial services

    II. Management Strategy First Half of Fiscal Year Integrated financial services Ending March 31, 2020 77 Securities (Accounts) (JPY bn) Intermediary accounts 11,550 Balance of assets in custody Clients (individual customers, corporate customers, municipal governments) 12,000 Introduction accounts 10

  27. Slide 27: Rebalancing loan assets

    First Half of Fiscal Year II. Management Strategy Rebalancing loan assets Ending March 31, 2020 (JPY bn) Miyagi Pref. Tohoku region, etc. Tokyo/Nagoya/Osaka (excl. Miyagi Pref.) 2,885.5 Corporate loans 2,717.1 2,823.4 2,840.3 3,000 2,568.4 2,617.8 (yen-denominated, 2,354.6 2,452.1 864.8 849.1 864.1

  28. Slide 28: Strengthening promotion of assets in custody

    First Half of Fiscal Year II. Management Strategy Strengthening promotion of assets in custody Ending March 31, 2020 Customer-focused measures * The77 Bank (Times) (People) (People) (Cases) Number of tax-exempt accounts Number of seminars held for customers Number of Savings Investment Trust 600 12,

  29. Slide 29: Marketable securities trading structure

    First Half of Fiscal Year II. Management Strategy Marketable securities trading structure Ending March 31, 2020 Strengthening marketable securities trading structure Composition ratio by type (on an amortized cost base) <Marketable securities trading structure> <Reinvestment in yen-bond taking marke

  30. Slide 30: Leveraging digital technology (1)

    First Half of Fiscal Year II. Management Strategy Leveraging digital technology (1) Ending March 31, 2020 Leveraging digital technology Commencement of operation of “omnichannel” Omnichannel is a system that comprehensively manages Smartphone Rakuten Edy / LINE Pay / PayPay / pring / merpay / docomo

  31. Slide 31: Leveraging digital technology (2)

    First Half of Fiscal Year II. Management Strategy Leveraging digital technology (2) Ending March 31, 2020 Direction of digital strategy Utilizing digital technology effectively, the Bank contributes to maintenance and improvement of financial infrastructure (presence) as expected of the “77” brand f

  32. Slide 32: Productivity enhancement strategy

    First Half of Fiscal Year II. Management Strategy Productivity enhancement strategy Ending March 31, 2020 ○ Initiatives to establish an efficient sales structure Expenses Personnel Expenses Non-personnel expenses (Branches) Tax Core OHR Maintain the branch network in consideration of market situatio

  33. Slide 33: Governance strategy (1)

    First Half of Fiscal Year II. Management Strategy Governance strategy (1) Ending March 31, 2020 Dividends (JPY) (JPY) Term-end dividends Interim dividends After consolidation of shares 10 50 25.0 4.5 4.5 22.5 25.0 4.5 3.5 3.5 4.0 25 5 4.5 4.5 4.5 22.5 25.0 3.5 3.5 3.5 4.0 *(22.5) 0 0 2012/3 2013/3 2

  34. Slide 34: Governance strategy (2)

    First Half of Fiscal Year II. Management Strategy Governance strategy (2) Ending March 31, 2020 G Governance Corporate Governance Structure General Meeting of Stockholders Audit & Supervisory Committee Members Corporate Governance Committee Board of Directors Audit & Supervisory Committee 2 persons

  35. Slide 35: Regional revitalization (1)

    First Half of Fiscal Year II. Management Strategy Regional revitalization (1) Ending March 31, 2020 Support for starting a new company or business Support and develop regional core companies (Companies) Number of start-up support projects With the objectives of new Collaboration with Sendai Future G

  36. Slide 36: Regional revitalization (2)

    First Half of Fiscal Year II. Management Strategy Regional revitalization (2) Ending March 31, 2020 Promotion of urban development [Support members] The 77 Bank Dissemination and Financial institutions and universities, etc. awareness-raising signing Cooperation Agreements Secretariat: Regional Deve

  37. Slide 37: Earthquake reconstruction (1)

    First Half of Fiscal Year II. Management Strategy Earthquake reconstruction (1) Ending March 31, 2020 Efforts toward earthquake reconstruction 77 Earthquake Reconstruction Support Housing Loans (for Earthquake-related loan performance (cumulative total collective relocation/leased land type) disburs

  38. Slide 38: Earthquake reconstruction (2)

    First Half of Fiscal Year II. Management Strategy Earthquake reconstruction (2) Ending March 31, 2020 Damage inflicted by Typhoon No. 19, etc. Damage of Miyagi Prefecture Fund demand related to Initiatives of the Bank (As of November 22, 2019) restoration/reconstruction Number of households affected

  39. Slide 39: ESG (1)

    First Half of Fiscal Year II. Management Strategy ESG (1) Ending March 31, 2020 E Environment Ｓ Social * Initiatives for working style reform 〇 Implementation of ESG Investments (1) Achieving work-life balance Actively implemented ESG investments, such as 100.0% Usage of annual paid leave green bond

  40. Slide 40: ESG (2) (Social contribution activities)

    First Half of Fiscal Year II. Management Strategy ESG (2) (Social contribution activities) Ending March 31, 2020 E Environment Ｓ Social Interaction with the region Supporting cultural activities ● Implemented “One branch, one ● Held the 77 Fureai Concert social contribution campaign” ● Held the 77 S

  41. Slide 41: ESG (3) (Social contribution activities)

    First Half of Fiscal Year II. Management Strategy ESG (3) (Social contribution activities) Ending March 31, 2020 One branch, one social contribution campaign Regional promotion through corporate sports clubs Participation in regional events ・Participated in the Intercity Baseball Baseball team Tourn

  42. Slide 42: Translation and projections notice

    This is a Japanese-English translation of the presentation material for your convenience. In the case that there is any discrepancy between the Japanese and English versions, the Japanese version is assumed to be correct. Please note that the projections described in this document do not guarantee f

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