Hyakugo Bank, Ltd. · TSE:8368
Hyakugo Bank — The Hyakugo Bank — FY2023 Earnings Presentation
54 slides from Hyakugo Bank's earnings presentation, May 31, 2024
Slide 1: The Hyakugo Bank, Ltd. - Presentation for FY2023 Financial Results
The Hyakugo Bank, Ltd. TSE Prime, NSE Premier (8368) Information meeting Presentation for FY2023 Financial Results May 31, 2024
Slide 2: Table of Contents
Table of Contents Supporting the promotion of local products to Japan and overseas Supporting the discovery of the excellence of local products and Increased Productivity their promotion to Japan and overseas ... 4~5 Channel Strategy (Physical Branches, ATMs) ... 36 Outline of Financial Position Cha
Slide 3: Supporting the promotion of local products to Japan and overseas
Supporting the promotion of local products to Japan and overseas
Slide 4: Supporting the discovery of the excellence of local products and their promotion
Supporting the discovery of the excellence of local products and their promotion to Japan and overseas Showcasing event for Mie Prefecture: “Experience Mie -- Mie Sushi Day” Promoted Mie products under the theme of “sushi” which represents Japanese food Invited foreign nationals, mainly people from
Slide 5: Supporting the discovery of the excellence of local products and their promotion
Supporting the discovery of the excellence of local products and their promotion to Japan and overseas Showcasing event for Mie Prefecture: “Experience Mie -- Mie Sushi Day” Provided “a learning experience” for local high school students Providing classes on globalization and the diversity of people
Slide 6: Outline of Financial Position
Outline of Financial Position
Slide 7: Summary of Financial Results
Outline of Financial Position Summary of Financial Results Net income decreased 3.2% year-on-year, mainly due to an increase in credit costs (100 million yen) Year-on- (Million yen) FY 3/23 FY 3/24 Year-on- year FY 3/23 FY 3/24 year Gross operating income (1) 55,748 57,706 1,957 Interest and dividen
Slide 8: Interest income
Outline of Financial Position Interest income An increase in interest on loans and securities contributes to higher interest income of 20.2% year-on-year Year-on- Factors underlying changes in net interest income (Million yen) FY 3/23 FY 3/24 year <All branches (domestic and international operations
Slide 9: Fees and Commissions
Outline of Financial Position Fees and Commissions Fees and commissions decreased 1.0% year-on-year, mainly due to an increase in insurance premiums paid in response to the accumulation of outstanding mortgage loans. (Million yen) Year-on- Fees and commissions graph (non-consolidated) (Million yen)
Slide 10: Expenses
Outline of Financial Position Expenses Expenses grew 2.2% year-on-year due to increases in personnel and non-personnel expenses (Million yen) Expenses and core OHR Year-on- (Million yen) Taxes Non-personnel expenses Personnel expenses FY 3/23 FY 3/24 year 75.67% OHR (core gross operating profit basi
Slide 11: Credit Costs (non-performing loans ratio)
Outline of Financial Position Credit Costs (non-performing loans ratio) Credit costs rose year-on-year mainly due to changes in the method of calculating the general allowance for loan losses. (Million yen) Credit costs (non-consolidated) (Million yen) Year-on- FY 3/23 FY 3/24 Other Loss on sale of
Slide 12: Deposits (including negotiable certificates of deposit)
Outline of Financial Position Deposits (including negotiable certificates of deposit) Individual deposits and corporate deposits both remained strong, with total deposits up 1.8% year-on-year (100 million yen) (100 million yen) YoY Total deposits (average balance) FY 3/23 FY 3/24 change 60,212 up To
Slide 13: Loans
Outline of Financial Position Loans Loans increased 8.1% year-on-year, mainly due to an increase in loans to individuals, such as housing loans, and loans to small and medium-sized businesses (100 million yen) YoY Total loans (average balance) (100 million yen) FY 3/23 FY 3/24 Tokyo, Osaka Aichi Pre
Slide 14: Securities Investments
Outline of Financial Position Securities Investments Valuation gains (losses) on securities increased, mainly in stocks and investment trusts (100 million yen) end of 3/23 end of 3/24 Year-on-year Securities balance Securities balance 14,019 15,621 1,601 (100 million yen) Government bonds Municipal
Slide 15: Equity ratio
Outline of Financial Position Equity ratio The equity ratio fell 0.01 percentage points year-on-year, due to an increase in risk assets, resulting from an increase in loans and other factors Equity capital, shareholders’ equity, and equity ratio (100 million yen) (100 million yen) Equity capital Sha
Slide 16: FY 3/2025 Forecasts (published figures)
Outline of Financial Position FY 3/2025 Forecasts (published figures) Expectations of higher income based on an improvement in gain and loss from government bonds and other bonds and a decrease in credit costs Forecast (non-consolidated) (Million yen) Forecast (consolidated) (Million yen) FY 3/25 FY
Slide 17: Initiatives to Improve Corporate Value
Outline of Financial Position Initiatives to Improve Corporate Value The Bank will promote initiatives to improve P/B ratio in line with its basic policy of capital allocation to enhance corporate value Initiatives to improve P/B ratio Enhanced interest and service Higher RORA Enhanced earnings inco
Slide 18: Shareholder Returns
Outline of Financial Position Shareholder Returns Past initiatives for shareholder returns and forecast for FY2024 Approach to shareholder returns Long-term, stable dividends The Bank returns profits to shareholders based on the principle of long-term, stable dividends, while taking care to increase
Slide 19: Status of Cross-shareholdings
Outline of Financial Position Status of Cross-shareholdings Review cross-shareholdings from the viewpoint of significance of holding and economic rationality Policy for reducing cross-shareholdings Accelerate the use of funds for the sale of cross-shareholdings in strategic Number of cross-sharehold
Slide 20: Medium-term Management Plan KAI-KAKU 150 2nd STAGE: State of Progress
Medium-term Management Plan KAI-KAKU 150 2nd STAGE “Gateway to the Future II” Aiming to Transform into a Green & Consulting Bank Group State of Progress
Slide 21: Overall Picture of the Medium-term Management Plan
Gateway to the Future II Overall Picture of the Medium-term Management Plan Medium-term Management Plan KAI-KAKU 150 2nd STAGE “Gateway to the Future II” consists of five basic policies and 11 key strategies Five Basic Policies 11 Key Strategies I Strengthening Efforts Towards Carbon 1 Carbon Neutra
Slide 22: Numerical Targets (General)
Gateway to the Future II Numerical Targets (General) Continue to face difficult conditions due to the market environment and other factors, but the Group promotes various measures to achieve the final targets of the Medium-Term Management Plan Targets in FY 3/25 Results in FY 3/23 Results in FY 3/24
Slide 23: Carbon Neutral Strategy (Local Initiatives)
Strengthening Efforts I Towards Carbon Neutrality Carbon Neutral Strategy (Local Initiatives) The Bank implemented initiatives to support local decarbonization Initiatives to support decarbonized management Initiatives with local governments Assistance in calculating Hyakugo Decarbonization Promoted
Slide 24: Strategy to Enhance Loan Income and Fees and Commissions (General)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (General) Steadily increase loans to small and medium-sized businesses and consumer loans in the region, leading to an increase in loan and service revenues Loans to medium-sized companies Total loans Average ba
Slide 25: Strategy to Enhance Loan Income and Fees and Commissions (Housing Loans)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Housing Loans) Achieved synergy between personal plazas’ network and sales force FY2022 Initiatives Housing loans offered in a single year in value (100 million yen) 1H 2022 Aichi 3,662 Prefecture 3,151 Launch
Slide 26: Strategy to Enhance Loan Income and Fees and Commissions (Housing Loans)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Housing Loans) Revise mortgage targets in response to changes in external market conditions, accumulated higher quality assets Reorient mortgage acquisition plans as external market conditions change Trends in
Slide 27: Strategy to Enhance Loan Income and Fees and Commissions (Housing Loans)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Housing Loans) Maintain financial health even as new housing loans and balance increased, and develop housing loan policies to prepare for market changes Housing loan delinquency and default status Provision fo
Slide 28: Strategy to Enhance Loan Income and Fees and Commissions (Unsecured Loans)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Unsecured Loans) Promote unsecured loans by capturing the funding needs of housing loan customers Outstanding balance of unsecured loans Delinquent unsecured loan balance and rate (100 million yen) Specific-pur
Slide 29: Strategy to Enhance Loan Income and Fees and Commissions (Depository Assets)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Depository Assets) Leverage synergies between face-to-face and non-face-to-face sales, and conduct customer-oriented business operations and increase overall income from depository assets Organization of the de
Slide 30: Strategy to Enhance Loan Income and Fees and Commissions (Depository Assets)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Depository Assets) Evolve face-to-face and non-face-to-face sales to establish a stock business Provide optimal services according to each customer’s “life stage” Appropriately apply face-to-face and non-face
Slide 31: Strategy to Enhance Loan Income and Fees and Commissions (Corporate Consulting)
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Corporate Consulting) Provide optimal solutions to customers’ diverse management issues and needs and increase non-interest income Increased corporate solutions fees Results and plan of corporate (Million yen)
Slide 32: Corporate Consulting: Promotion of structured financing
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Corporate Consulting) Examples of initiatives that demonstrate the Bank’s consulting capabilities — promotion of structured financing Promotion of project finance for PFI business Cumulative total of PFI loans
Slide 33: Corporate Consulting: Business succession support
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Corporate Consulting) Enhance the scheme to support business succession as part of the Bank’s commitment to sustainable community development, and increase earnings also Support for business succession Establis
Slide 34: Corporate Consulting: Medical and welfare support
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Corporate Consulting) Enhance the sustainability of the region by continuing to strengthen its support for medical and welfare services, which are an important part of the region’s infrastructure Active support
Slide 35: Securities Strategy
Strengthening Business II Model Securities Strategy Gradually restructured the yen-bond portfolio as monetary policy normalized, and implemented portfolio improvements through exchange trading Changes in securities portfolio Valuation gains (losses) on securities Securities balance bottomed out due
Slide 36: Channel Strategy (Physical Branches, ATMs)
III Increased Productivity Channel Strategy (Physical Branches, ATMs) Aim to build an optimal sales structure by developing a channel strategy that captures the changing needs of customers Optimize the branch and ATM network Strengthen Consolidation of branches through branch- collaboration with Rev
Slide 37: Channel Strategy (Smartphone Banking)
III Increased Productivity Channel Strategy (Smartphone Banking) Establish alternative customer contact channels to in-store customer service Smartphone banking Changes in number of passbook-less accounts Improve the quality of monitoring Target of Medium-term Management Plan Introduction of unautho
Slide 38: Governance Strategy
Strengthening IV Management Foundation Governance Strategy Strengthen corporate governance to ensure the Bank’s sustainable growth and enhance its corporate value over the medium to long term Appointment and diversification of outside officers Ratio of outside officers Outside Inside Female Male * S
Slide 39: Human Resource Strategy and Diversity Strategy
V Increased Awareness of Human Resource Strategy and Diversity SDGs/ESG Strategy Promote human resource strategy and initiatives to strengthen engagement to enhance human capital Human capital Human capital Human resource strategy Human capital KPI Value creation issues investment (FY2024 targets) R
Slide 40: Human Resource Strategy and Diversity Strategy
V Increased Awareness of Human Resource Strategy and Diversity SDGs/ESG Strategy Key measurable indicators and targets related to investment in human capital and human resource strategy No. of personnel with professional qualifications No. of those who have acquired the IT Passport Ratio of women in
Slide 41: SDGs/ESG Strategy
Increased Awareness of V SDGs/ESG SDGs/ESG Strategy Greenhouse gas (GHG) emissions have been steadily declining.Information disclosure based on the TCFD concept is also implemented Greenhouse gas (GHG) emissions Scenario analysis and carbon-related assets Changes in greenhouse gas (GHG) emissions Ph
Slide 42: SDGs/ESG Strategy
Increased Awareness of V SDGs/ESG SDGs/ESG Strategy Sustainable finance: Project examples PIF’s efforts to issue evaluation reports in Project finance for renewable energy video format Positive impact finance (PIF) Green finance Support efforts to increase Supporting renewable Evaluation positive ec
Slide 43: Appendix
Srna Appendix
Slide 44: Potential of Major Sales Areas
Appendix Potential of Major Sales Areas Mie Prefecture: the main business area of Hyakugo Bank Aichi Prefecture: A neighboring prefecture with a large market; accelerating expansion into the market there Item Unit Mie Rank * Aichi Rank * Prefecture Prefecture Total area (January 2024) 100 km2 57.74
Slide 45: Deposits and Loans
Appendix Deposits and Loans Deposits (ending balance) (Million yen) Loans (ending balance) (Million yen) end of end of end of end of end of end of end of end of end of end of 3/20 3/21 3/22 3/23 3/24 3/20 3/21 3/22 3/23 3/24 Corporate Corporate sector deposits 957,260 1,140,057 1,148,376 1,172,626 1
Slide 46: Deposits and Depository Assets
Appendix Deposits (including negotiable certificates of deposit), Depository Assets Hyakugo Securities (after excluding the Bank’s brokerage) Total deposits Mie Prefecture Aichi Prefecture Tokyo, Osaka Depository assets, Insurance Financial Investment trusts instrument brokerage (average balance) 60
Slide 47: Loans
Appendix Loans Mie Aichi Tokyo, Total loans Prefecture Prefecture Osaka (average balance) 47,333 (100 million yen) 43,785 Mie Aichi Tokyo, 40,999 Loans to SMEs Prefecture Prefecture Osaka 8,322 38,240 7,865 (average balance) 35,297 (100 million yen) 7,610 15,375 7,532 14,564 7,460 13,834 2,208 1,964
Slide 48: Integrated Risk Management
Appendix Integrated Risk Management Risk is kept within an appropriate range according to the Bank’s operating capabilities based on integrated risk management. Compared with core capital of 268.3 billion yen and allocable capital of 180.4 billion yen, actual amount of risk is 71.7 billion yen. (100
Slide 49: Outstanding Non-performing Loans by Disclosure Standard and Coverage
Appendix Outstanding Non-performing Loans by Disclosure Standard and Coverage Loans disclosed under the Financial Reconstruction Act and risk-managed claims (target: total credit exposure) Non-performing Loans under Internal Assessment Standard (target: total credit exposure) *Special attention loan
Slide 50: Trends of Debtor Classification
Appendix Trends of Debtor Classification Upper: Number of debtors / Lower: Credit exposure (Million yen) Debtor Classification as of March 31, 2024 Ratio of Other under downgrading to Under Possible Substantial Upgrade Downgrade Normal close Failure Other possible failure control failure failure Bul
Slide 51: Hyakugo Bank's Credit Policies
Appendix Hyakugo Bank’s Credit Policies Compliance of Hyakugo Credit Policy (March 31, 2024) (100 million yen) Classification Content Limit Compliance Loans for individuals engaging in 7% or less of total loans 3,437 1,954 3.98% housing leasing business Loans for other real estate industry 7% or les
Slide 52: Mie Prefecture's Shares of Deposits and Loans
Appendix Mie Prefecture’s Shares of Deposits and Loans Deposits Loans Including megabanks Megabank Other Shinkin Bank A Hyakugo Bank Hyakugo Bank Bank A Shinkin Other Megabank 9.1 9.1 11.3 24.4 46.1 Mie 39.8 28.3 11.2 16.0 4.7 Prefecture * Excludes Agricultural Cooperative, Fisheries Cooperative, JP
Slide 53: Group Companies
Appendix Group Companies Enhancing the comprehensive strength of the entire Group Can provide integrated financial services. Think tank services Group companies work together for higher Services for individual service efficiency, while striving to secure further customers profits outside the Group.
Slide 54: Inquiries concerning this document
Please direct inquiries concerning this document to: Corporate Planning Division, The Hyakugo Bank, Ltd. Abe/Bessho at Public Relations SDGs Promotion Office ir@hyakugo.co.jp https://www.hyakugo.co.jp/ The information concerning entities other than the Bank contained in this document has been quoted