77 Bank, Ltd. · TSE:8341
77 Bank — The 77 Bank — FY2020 Earnings Presentation
38 slides from 77 Bank's earnings presentation, Jun 2, 2020
Slide 1: IR Presentation: Results for the Fiscal Year Ended March 31, 2020
IR Presentation Results for the Fiscal Year Ended March 31, 2020 June 2, 2020 Materials were prepared for the Bank’s presentation of its results for the fiscal year ended March 31, 2020 held on June 2, 2020.
Slide 2: Contents
Contents Fiscal Year Ended March 31, 2020 I. Financial Summary III. Management Strategy □ Summary of profits and losses 3 □ Principal markets 19 □ Interest income 4 □ Management philosophy/Bank image sought by The 77 Bank 20 □ Loans and bills discounted/Deposits 5 □ Growth Strategy □ Securities 6 ・C
Slide 3: I. Financial Summary
I. Financial Summary For The Customer C&O For The Future RAR AY EIT YIN CCRT 2 TI BANK
Slide 4: Summary of profits and losses
I. Financial Summary Summary of profits and losses Fiscal Year Ended March 31, 2020 (JPY bn, %) YoY change Summary of profits and losses FY2019 FY2020 Increase/ Rate of (Non-consolidated) Decrease change % <Core operating income> Gross operating income 69.2 72.1 2.9 4.2 Core operating income increas
Slide 5: Interest income
I. Financial Summary Interest income Fiscal Year Ended March 31, 2020 (JPY bn) FY2019 FY2020 YoY change <FY2020 summary> Interest income 65.9 68.5 2.6 Interest income increased JPY 2.6 billion year-on-year due to an Investment income 69.4 70.8 1.4 increase in interest and dividends on securities and
Slide 6: Loans and bills discounted/Deposits
I. Financial Summary Loans and bills discounted/Deposits Fiscal Year Ended March 31, 2020 (JPY bn, %) (JPY bn, %) FY2019 FY2020 YoY change (%) FY2019 FY2020 YoY change (%) Loans and bills discounted Deposits and certificates of (average balances) 4,662.3 4,747.5 1.8 7,766.8 7,790.8 0.3 deposits (ave
Slide 7: Securities (1)
I. Financial Summary Securities (1) Fiscal Year Ended March 31, 2020 Balance of marketable securities (on an amortized cost base) <FY2020 summary> National gov. bonds Local gov. bonds Balance of marketable securities increased JPY 14.8 Corporate bonds Others (JPY bn) Stocks Balance of public, etc. (
Slide 8: Securities (2)
I. Financial Summary Securities (2) Fiscal Year Ended March 31, 2020 Gains (losses) from evaluation of securities <FY2020 summary> National gov. bonds Local gov. bonds Gains (losses) from evaluation of securities decreased (JPY bn) Corporate bonds Others JPY 66.3 billion year-on-year due to a decrea
Slide 9: Fees and commissions
I. Financial Summary Fees and commissions Fiscal Year Ended March 31, 2020 <FY2020 summary> Fees and commissions increased JPY 0.1 billion year-on-year because of a favorable increase in fees and commissions from corporate clients for the services including syndicated loans, commitment lines and M&A
Slide 10: Expenses
I. Financial Summary Expenses Fiscal Year Ended March 31, 2020 <FY2020 summary> Expenses increased JPY 0.4 billion year-on-year, because of increased non-personnel expenses due to an increase in system- related expenses, as well as increased taxes due to a consumption tax rate hike, despite decrease
Slide 11: Credit-related expenses/reserve for possible loan losses
Credit-related expenses/reserve for possible loan losses I. Financial Summary /credits disclosed under the Financial Reconstruction Law Fiscal Year Ended March 31, 2020 <FY2020 summary> Credit-related expenses increased JPY 5.0 billion year-on-year, due to a downgrade on the back of the tapering off
Slide 12: II. Projected Performance
II. Projected Performance 11
Slide 13: Response to COVID-19 (1)
II. Projected Performance Response to COVID-19 (1) Fiscal Year Ended March 31, 2020 Results of the survey of trends in business activities in Miyagi Prefecture (Survey by 77 Research and Consulting Co., Ltd.; survey period: between March 13 and April 15) Proportion of companies whose business condit
Slide 14: Response to COVID-19 (2)
II. Projected Performance Response to COVID-19 (2) Fiscal Year Ended March 31, 2020 Status of funding support Lending activities for corporate loan customers (Cases) Status of loan provision to businesses affected by COVID-19 (Number of corporate loan customers (net) as of the end of February 1,600
Slide 15: Response to COVID-19 (3)
II. Projected Performance Response to COVID-19 (3) Fiscal Year Ended March 31, 2020 Various services Operation framework within The 77 Bank • Expansion of services not requiring visits to branches (Maintaining financial intermediary functions while preventing the spread of COVID-19) Launch of consul
Slide 16: Projected performance for FY2021
II. Projected Performance Projected performance for FY2021 Fiscal Year Ended March 31, 2020 (JPY bn) (%) Summary of profits and losses FY2019 FY2020 YoY Interest rates/ Interest FY2020 FY2021 (Non-consolidated) (Results) (Forecast) change margin (Results) (Forecast) YoY change Loans and bills discou
Slide 17: Quantitative
II. Projected Performance Quantitative Fiscal Year Ended March 31, 2020 1. Major accounts (average balance) (JPY bn, %) FY2018 FY2019 FY2020 FY2021 Increase compared to FY2018 (Results) (Results) (Results) (Forecast) change % Loans and bills discounted 4,494.0 4,662.3 4,747.5 4,900.0 406.0 9.0 Corpo
Slide 18: Progress of the Medium-term Management Plan
II. Projected Performance Progress of the Medium-term Management Plan Fiscal Year Ended March 31, 2020 １．Targets (JPY bn, %) <Interest rates and other assumptions as well as forecasts (average)> (%, JPY) Medium-term FY2019 FY2020 FY2021 Results Forecast Management At the time of At the time of At th
Slide 19: III. Management Strategy
lil. Management Strategy For The Customer C&O For The Future AAR AY EWF YIN CCRT 18 TI BANK
Slide 20: Principal markets
III. Management Strategy Principal markets Fiscal Year Ended March 31, 2020 (offices) Number of offices 140,000 120,000 98,190 102,026 100,000 Growth rate +3.9％ 80,000 60,000 No.1 in Japan in terms of 40,000 the growth rate since the last 20,000 survey (2012) 0 2012 2016 Source: Statistics Bureau, M
Slide 21: Management philosophy/Bank image sought by The 77 Bank
III. Management Strategy Management philosophy/Bank image sought by The 77 Bank Fiscal Year Ended March 31, 2020 The Bank’s management philosophy was Bank Creed established as the Bank Creed in 1961. The The Bank’s mission is to absorb funds and line that states “the Bank’s progress goes hand in han
Slide 22: Growth Strategy (Consulting-based sales) (1)
III. Management Strategy Growth Strategy (Consulting-based sales) (1) Fiscal Year Ended March 31, 2020 Consulting-based sales through business evaluations External support organizations The 77 Bank Group Cultivate and Clients Development Bank of Japan 77 77 capture diverse Issues for enhancement of
Slide 23: Growth Strategy (Consulting-based sales) (2)
III. Management Strategy Growth Strategy (Consulting-based sales) (2) Fiscal Year Ended March 31, 2020 Direction of corporate loans (2) Continuing rebalancing of loan assets (3) Capture local development (1) Response to COVID-19 projects Tohoku Region, etc. Within Miyagi Prefecture Capture developme
Slide 24: Growth Strategy (Consulting-based sales) (3)
III. Management Strategy Growth Strategy (Consulting-based sales) (3) Fiscal Year Ended March 31, 2020 Number of business evaluation Number of issue resolution measures shared/agreed (Customers) customers/Issue resolution measure (As of end-Mar. 2020) 7,000 agreement by entities Provision of financi
Slide 25: Growth Strategy (Consulting-based sales) (4)
III. Management Strategy Growth Strategy (Consulting-based sales) (4) Fiscal Year Ended March 31, 2020 Fees and commissions for syndicated loans and M&A fees and commissions/Number of M&A commitment lines advisory contract clients (JPY mn) (Cases) (JPY mn) (Clients) Number of transactions handled wh
Slide 26: Growth Strategy (Consulting-based sales) (5)
III. Management Strategy Growth Strategy (Consulting-based sales) (5) Fiscal Year Ended March 31, 2020 Balance of assets in custody (the Group) Sales of assets in custody (the Group) (JPY bn) 77 Securities (JPY bn) Structured bonds, etc. (brokerage) 77 Securities Structured bonds, etc. (brokerage) F
Slide 27: Growth Strategy (HR development)
III. Management Strategy Growth Strategy (HR development) Fiscal Year Ended March 31, 2020 ■ Basic approach to human resource development OJT at the workplace forms the basis for human resource development. Our basic approach toward the knowledge and skills that each employee believes to be necessar
Slide 28: Growth Strategy (Marketable securities trading)
III. Management Strategy Growth Strategy (Marketable securities trading) Fiscal Year Ended 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 market tren
Slide 29: Productivity enhancement strategy (Paperwork-free/Digital strategy)
Productivity enhancement strategy III. Management Strategy Fiscal Year Ended March 31, 2020 (Paperwork-free/Digital strategy) Short-term perspective Medium- to long-term perspective Paperwork-free strategy Digital strategy Reduction and streamlining of branch administration Expansion and enhancement
Slide 30: Governance strategy (Capital policies)
III. Management Strategy Governance strategy (Capital policies) Fiscal Year Ended March 31, 2020 Dividends (JPY) (JPY) Term-end dividends Interim dividends After consolidation of shares 10 50 25.0 25.0 4.5 4.5 22.5 25.0 4.5 5 3.5 3.5 4.0 25 4.5 25.0 25.0 4.0 4.5 4.5 22.5 3.5 3.5 3.5 ※(22.5) 0 2012/3
Slide 31: Governance strategy (Improvements in governance)
III. Management Strategy Governance strategy (Improvements in governance) Fiscal Year Ended March 31, 2020 Improvements in governance The Bank transitioned in June 2017 from a company with the Board of Corporate Auditors to a company with an Audit & Supervisory Committee to improve corporate value t
Slide 32: Regional economy vitalization strategy (SDGs/ESG) (1)
Regional economy vitalization strategy III. Management Strategy (SDGs/ESG) (1) Fiscal Year Ended March 31, 2020 Vitalization of the regional economy (Regional revitalization and Earthquake reconstruction) Support for starting a new company or business Seminars held (second half of FY2020) TSE IPO Se
Slide 33: Regional economy vitalization strategy (SDGs/ESG) (2)
Regional economy vitalization strategy III. Management Strategy (SDGs/ESG) (2) Fiscal Year Ended March 31, 2020 Vitalization of the regional economy (Regional revitalization and Earthquake reconstruction) Support and develop Support for regional core companies promotion of tourism, etc. Collaboratio
Slide 34: Regional economy vitalization strategy (SDGs/ESG) (3)
Regional economy vitalization strategy III. Management Strategy (SDGs/ESG) (3) Fiscal Year Ended March 31, 2020 Vitalization of the regional economy (Regional revitalization and Earthquake reconstruction) Earthquake-related loan performance (cumulative total after the Results of Loans related to Rec
Slide 35: Regional economy vitalization strategy (SDGs/ESG) (4)
Regional economy vitalization strategy III. Management Strategy (SDGs/ESG) (4) Fiscal Year Ended March 31, 2020 Support for success of each and every employee (diversity) NEW NEW Certified as “Health and Productivity Received “Commendation for a Holding of “Career Seminar & Model Business Committed
Slide 36: Regional economy vitalization strategy (SDGs/ESG) (5)
Regional economy vitalization strategy III. Management Strategy (SDGs/ESG) (5) Fiscal Year Ended March 31, 2020 Response to the global warming and climate change Renewable energy-related funding Actual sales of 77 ESG Japanese Equities Open 40 cases/¥32.8 billion (FY2020) (Alias: Miyagi no Kizuna) C
Slide 37: Regional economy vitalization strategy (SDGs/ESG) (6)
Regional economy vitalization strategy III. Management Strategy (SDGs/ESG) (6) Fiscal Year Ended March 31, 2020 Social contribution activities Interaction with the region Responding to environmental issues Supporting financial education • Implemented “One branch, one social • Part of the proceeds fr
Slide 38: This is a Japanese-English translation of the presentation material for your convenience. In the
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