Hyakugo Bank, Ltd. · TSE:8368
Hyakugo Bank — The Hyakugo Bank — H1 FY2023 Earnings Presentation
52 slides from Hyakugo Bank's earnings presentation, Nov 30, 2023
Slide 1: The Hyakugo Bank, Ltd. Presentation for FY2023 Interim Financial Results
The Hyakugo Bank, Ltd. TSE Prime, NSE Premier (8368) Information meeting Presentation for FY2023 Interim Financial Results November 30, 2023
Slide 2: Table of Contents
Table of Contents Regional revitalization through the export of local products Regional revitalization through the export of Increased Productivity local products ... 4~6 Channel Strategy (Physical Branches, ATMs) ... 35 Outline of Financial Position Channel Strategy (Smartphone Banking) ... 36 Stre
Slide 3: Regional revitalization through the export of local products
Regional revitalization through the export of local products Practical Export Support That Realizes Both “Market-in” and “Local-in”
Slide 4: Examples of the Bank's Accompanying Export Support Services
Examples of the Bank’s Accompanying Export Support Services Support for business negotiations with overseas local buyers / support for participation in domestic and international export business meetings Since May 2023, the Bank has been offering individual consultations to overseas local buyers and
Slide 5: Cross-Industry Collaboration to Solve Local Issues
Cross-Industry Collaboration to Solve Local Issues Support for collaboration “only a local bank can provide” by making the most of the Bank’s network Collaboration between a local factory and a Support for product development partnership between a fishery business for export seaweed manufacturer and
Slide 6: Creating a System that Makes the Exporting of Local Products More Accessible
Creating a System that Makes the Exporting of Local Products More Accessible Building a new one-stop export support scheme Collaboration with WeAgri and ABC Style Development of sales channels for overseas markets LOCAL DESIGN Clients MIE Provide export Provide one-stop service consulting services I
Slide 7: Outline of Financial Position
Outline of Financial Position
Slide 8: Summary of Financial Results
Outline of Financial Position Summary of Financial Results Interim net income increased 6.5% year-on-year due to an increase in interest income and a decrease in credit costs (100 million yen) YoY (Million yen) FY 9/22 FY 9/23 Year-on- change FY 9/22 FY 9/23 year Gross operating income (1) 27,832 28
Slide 9: Interest Income
Outline of Financial Position Interest Income An increase in interest on loans and securities contributes to higher interest income of 21.1% year-on-year (Million yen) FY 9/22 FY 9/23 YoY Factors underlying changes in net interest income change (Million yen) <All branches (domestic and international
Slide 10: Fees and Commissions
Outline of Financial Position Fees and Commissions Fees and commissions fell 0.5% year-on-year, mainly due to an increase in insurance premiums paid resulting from an increase in housing loans (Million yen) YoY Fees and commissions graph (non-consolidated) (Million yen) FY 9/22 FY 9/23 Corporate sol
Slide 11: Expenses
Outline of Financial Position Expenses Expenses grew 0.9% year-on-year due to increases in personnel and non-personnel expenses (Million yen) Expenses and core OHR YoY (Million yen) Taxes Non-personnel expenses Personnel expenses FY 9/22 FY 9/23 change OHR (core gross operating profit basis) Expense
Slide 12: Credit Costs (nonperforming loans ratio)
Outline of Financial Position Credit Costs (nonperforming loans ratio) Decrease in the provision of specific allowance for loan losses caused a year-on-year decrease in credit costs (Million yen) YoY Credit costs (non-consolidated) (Million yen) FY 9/22 FY 9/23 Other Provision of specific allowance
Slide 13: Deposits (including negotiable certificates of deposit)
Outline of Financial Position Deposits (including negotiable certificates of deposit) Individual deposits and corporate deposits remained strong, with total deposits up 1.9% year-on-year (100 million yen) (100 million yen) YoY Total deposits (average balance) FY 3/23 FY 9/23 change 60,304 Tokyo, Osa
Slide 14: Loans
Outline of Financial Position Loans Loans increased 6.2% 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 9/23 change Tokyo, Osaka Ai
Slide 15: Securities Investments
Outline of Financial Position Securities Investments Valuation gains (losses) on securities increased, mainly in stocks (100 million yen) end of 3/23 end of 9/23 YoY change Securities balance Government Municipal Corporate Stocks bonds bonds bonds Securities balance 14,019 14,581 561 (100 million ye
Slide 16: Equity Ratio
Outline of Financial Position Equity Ratio Equity ratio rose 0.04 points from the end of the previous fiscal year due to an increase in equity capital resulting from profit recognition, etc. Equity capital, shareholders’ equity, and equity ratio (100 million yen) (100 million yen) Equity capital Sha
Slide 17: FY 3/2024 Forecasts (published figures)
Outline of Financial Position FY 3/2024 Forecasts (published figures) Financial results are expected to exceed FY2022 levels on both a consolidated and non-consolidated basis, with record profits Forecast (non-consolidated) (Million yen) FY 3/24 Forecast (consolidated) (Million yen) FY 3/24 (initial
Slide 18: Dividends
Outline of Financial Position Dividends Pay an interim dividend in commemoration of its 145th anniversary The Bank paid a commemorative dividend for the 145th anniversary of its founding in the interim dividend for FY 3/24. Adding a commemorative dividend of 1 yen to the previous forecast of 7 yen,
Slide 19: Capital Policy
Outline of Financial Position Capital Policy The Bank will promote initiatives to improve P/B ratio in line with its basic policy of capital allocation to enhance corporate value Basic policy on capital allocation to enhance corporate value Through disciplined management of risk-weighted assets and
Slide 20: Medium-term Management Plan 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 Overall Picture of the Medium-term Future II 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 Neutrality 1 Ca
Slide 22: Numerical Targets (General)
Gateway to the Future II Numerical Targets (General) KGIs are generally on track. KPIs 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 Res
Slide 23: Carbon Neutral Strategy (Local Initiatives)
I Strengthening Efforts 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 Cooperat
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 Consumer loans Total l
Slide 25: Housing Loans: Increasing and Training Sales Personnel
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Housing Loans) Toward a structure capable of acquiring 400 billion yen annually by improving the skills of sales personnel Effects of increasing and training sales personnel Housing loans offered in a single ye
Slide 26: Housing Loans: Financial Health and Streamlining
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 Further streamline and computerize housing loan operations Housing loan delinquency and default status Streamline housing
Slide 27: 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 28: Depository Assets: Face-to-face and Non-face-to-face Sales
II Strengthening Business Strategy to Enhance Loan Income and Fees Model and Commissions (Depository Assets) Conduct customer-oriented business operations and increase overall income from depository assets by leveraging synergies between face-to-face and non-face-to-face sales Consulting plaza for “
Slide 29: Depository Assets: Services by Life Stage
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” Expand the base of the asset-building group b
Slide 30: Corporate Consulting: Corporate Solutions Fees
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 31: Corporate Consulting: Structured Financing and PFI
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 32: 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 Enhance
Slide 33: 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 34: Securities Strategy
II Strengthening Business Model Securities Strategy Resume investment in long-term bonds at a gradual pace following the monetary policy correction. The Bank invests mainly in floating-rate bonds, taking into account interest rate hikes in foreign currency-denominated bonds Changes in securities por
Slide 35: 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 collaboration with Consolidation of branches through branch- the
Slide 36: 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 Use of smartphone banking Target of Medium-term Management Plan In-app questionnaire 300,000 ac
Slide 37: Governance Strategy
IV Strengthening 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 * A
Slide 38: Human Resource Strategy and Diversity Strategy
V Increased Awareness of Human Resource Strategy and SDGs/ESG Diversity Strategy Promote human resource strategy and initiatives to strengthen engagement to enhance human capital Human capital Human capital Human resources strategy Human capital KPI Value creation issues investment (FY2024 targets)
Slide 39: Human Resource Strategy and Diversity Strategy: Indicators and Targets
V Increased Awareness of Human Resource Strategy and SDGs/ESG Diversity 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 40: SDGs/ESG Strategy
V Increased Awareness of SDGs/ESG SDGs/ESG Strategy Greenhouse gas (GHG) emissions have been steadily declining. The Bank has also disclosed information in line with the TCFD recommendations Greenhouse gas (GHG) emissions Scenario analysis and carbon-related assets (disclosed July 2023) Changes in g
Slide 41: SDGs/ESG Strategy
V Increased Awareness of SDGs/ESG SDGs/ESG Strategy Contributes to tourism town development through public-private partnerships. The Bank is also engaged in financial and economic education and sports promotion Initiatives for tourism town development Initiatives for financial and economic education
Slide 42: Appendix
Ban Ri Appendix
Slide 43: 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 9/23 3/20 3/21 3/22 3/23 9/23 Corporate Corporate sector 2,038,320 2,211,389 2,230,098 2,361,962 2,401,40
Slide 44: 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 instruments brokerage (average balance) 5
Slide 45: Loans
Appendix Loans Total loans Mie Prefecture Aichi Prefecture Tokyo, Osaka 46,500 (average balance) 43,785 (100 million yen) 40,999 8,222 7,865 Loans to SMEs Mie Prefecture Aichi Prefecture Tokyo, Osaka 38,240 7,610 (average balance) 35,297 (100 million yen) 15,238 7,532 14,564 7,460 16,731 18,569 13,8
Slide 46: 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 267.1 billion yen and allocable capital of 180.0 billion yen, actual amount of risk is 65.9 billion yen. (100
Slide 47: Outstanding Nonperforming Loans by Disclosure Standard and Coverage
Appendix Outstanding Nonperforming Loans by Disclosure Standard and Coverage Loans disclosed under the Financial Reconstruction Act and risk-managed claims (target: total credit exposure) Nonperforming Loans under Internal Assessment Standard (target: total credit exposure) *Special attention loans,
Slide 48: Trends of Debtor Classification
Appendix Trends of Debtor Classification Upper: Number of debtors / Lower: Credit exposure (Million yen) Debtor Classification as of September 30, 2023 Ratio of Other under downgrading Under Possible Substantial Upgrade Downgrade Normal close Failure Other to possible control failure failure Bulk, e
Slide 49: Hyakugo Bank's Credit Policies
Appendix Hyakugo Bank’s Credit Policies Compliance with Hyakugo Bank’s credit policies (as of September 30, 2023) (100 million yen) Classification Content Limit Compliance Loans for individuals engaging in 7% or less of total loans 3,317 1,949 4.11% housing leasing business Loans for other real esta
Slide 50: 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 Mie 9.0 9.0 11.4 24.4 46.2 Prefecture 39.5 28.1 11.3 16.3 4.8 * Excludes Agricultural Cooperative, Fisheries Cooperative, JP
Slide 51: Group Companies
Appendix Group Companies Enhancing the comprehensive strength of the entire Group Think tank services Can provide integrated financial services. Group companies work together for higher service Services for individual and efficiency, while striving to secure further profits corporate customers outsi
Slide 52: 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