Kyoto Financial Group,inc. · TSE:5844
Kyoto Financial Group,inc — FY2024 Earnings Presentation
50 slides from Kyoto Financial Group,inc's earnings presentation, Jun 10, 2025
Slide 1: FY2024 Financial Results Briefing Session
FY2024 Financial Results Briefing Session May, 2025 (Securities code: 5844)
Slide 2: Index
Index Ⅰ. Business performance overview Deposits 26 Financial Summary of FY2024 3 Market Operations 27 Financial Results Summary of FY2024 4 28 (Kyoto Bank, non- consolidated) Shareholder returns Interest Income and Rate earned on Loans and Bills Capital Allocation 29 5 (Kyoto Bank, non-consolidated)
Slide 3: Ⅰ. Business performance overview
Ⅰ. Business performance overview
Slide 4: Financial Summary of FY2024
Financial Summary of FY2024 Kyoto FG consolidated (JPY bn) FY2023 FY2024 YoY Gross operating profit 97.2 106.3 9.1 Kyoto FG's consolidated net Ordinary profit 43.5 50.9 7.4 income reached an all-time high, including periods Net income attributable to 31.5 36.5 5.0 before the transition to a owners o
Slide 5: Financial Results Summary of FY2024 (Kyoto Bank, non-consolidated)
Financial Results Summary of FY2024 (Kyoto Bank, non- consolidated) (JPY bn) FY2023 FY2024 YoY Gross operating profit 92.0 98.9 6.9 Net interest income 79.8 84.4 4.6 Increase mainly in interest on loans, etc. Net fees and commissions 13.1 13.3 0.2 Other operating profit (0.9) 1.2 2.1 hitting a recor
Slide 6: Interest Income and Rate earned on Loans and Bills
Interest Income and Rate earned on Loans and Bills (Kyoto Bank, non-consolidated) Factors of Net Interest Income Loans and bills discounted (term-average) Foreign (JPY bn) (%) Domestic Currency Other 10.2 YoY Loans and Funding (Domestic 9.2 Change Bills Domestic gap deposits, etc.) rate securities 4
Slide 7: Non-interest Income (Consolidated)
Non-interest Income (Consolidated) Non-interest income (Fees and commissions + Other operating income) (*1) 23.05 (JPY bn) 19.68 19.64 16.58 15.38 15.69 Kyoto Bank 14.51 14.53 10.24 11.45 Group companies 7.36 5.13 5.13 5.16 5.10 (excluding Kyoto Bank) FY2020 FY2021 FY2022 FY2023 FY2024 Details of no
Slide 8: Credit Costs and Disclosed assets
Credit Costs and Disclosed assets (Kyoto Bank, Non-consolidated) Break down of credit costs (JPY bn) FY2025 FY2020 FY2021 FY2022 FY2023 FY2024 (Plan) Net provision for allowance for specific loan losses 6.3 2.9 2.1 0.9 0.9 2.3 Disposal amount due to occurrence of new 7.4 4.1 3.2 2.4 3.5 nonperformin
Slide 9: Financial Results Forecast for FY2025
Financial Results Forecast for FY2025 Consolidated net income is expected to increase for the five consecutive fiscal year and reach a record high. Kyoto FG consolidated (JPY bn) FY2025 FY2024 (Plan) YoY Ordinary profit 50.9 58.1 7.2 Net income attributable to owners of the parent 36.5 40.0 3.5 Kyot
Slide 10: Ⅱ. Management strategy
Il. Management strategy
Slide 11: New Strategic Targets
New Strategic Targets We announced New Strategic Targets to significantly increase the growth trajectory in November 2024. ROE (net asset basis) Net income attributable to owners of the parent 8.0% or more 1st Medium-Term 2nd Medium-Term Management Management Plan Plan [New strategic target] (From O
Slide 12: The 2nd Medium-Term Management Plan
The 2nd Medium-Term Management Plan Set new strategic targets and begin formulating the 2nd Medium-Term Management Plan (April 2026 to March 2029) New strategic targets To be Item Target achieved by ROE (net asset basis) March 2029 5% Achieve 8% or more in first half of 2030s Net income attributable
Slide 13: ROE
ROE Achieve an ROE of 5% by the final year of the next mid-term management plan, and aim to exceed 8%, surpassing the cost of capital, in the first half of 2030s. Development of ROE (net asset basis) 10% ROE targets for Growth Strategy for Improving ROE First half of 2030s (1) Discover and nurture n
Slide 14: Reinforcement of Governance
Reinforcement of Governance Introduction of performance-linked compensation system Composition of the Board of Directors (To be revised on June 27, 2025) Will propose amendments to the Articles of Incorporation at the General Meeting of Shareholders to be held in June 2025 to reduce the number of
Slide 15: External Downside Factor: US Tariff Measures
External Downside Factor: US Tariff Measures We will closely monitor the impact of US tariffs on our group and our customers. Impact on clients The first business sentiment survey since Trump administration imposed tariffs (conducted in May 2025) showed no sharp downward trend 2025/8 Year/month 20
Slide 16: External Factors for Upside: Impact of rising JPY interest rate
External Factors for Upside Impact of rising JPY interest rate (Kyoto Bank, Non-consolidated) Assuming that the Bank of Japan's policy interest rate rises to 1.00%, it is expected that the net interest income will increase by approximately JPY32.0bn in five years. Impact of rising interest rates on
Slide 17: Results of Group Companies (Excluding Kyoto Bank)
Results of Group Companies (Excluding Kyoto Bank) Continue to promote the autonomous growth of each group company and expand each business through group collaboration. Karasuma Shoji Co., Ltd. Kyoto Credit Service Co., Ltd. Kyogin Card Service Co., Ltd. Kyogin Lease Co., Ltd. (JPY mn) FY2024 YoY (JP
Slide 18: Group-wide Strategy to Meet the Challenge of Change (1)
Group-wide Strategy to Meet the Challenge of Change (1) Establishment of new company - Kyoto M&A Advisory, a subsidiary specializing in M&A support (scheduled for July 2025) History of M&A support business Concept of Kyoto M&A Advisory Started M&A support business 2001 * Started M&A support sooner t
Slide 19: Group-wide Strategy to Meet the Challenge of Change (2)
Group-wide Strategy to Meet the Challenge of Change (2) Growth investment ~ KCAP leads the effort in promoting growth investment for the next generation. Results of venture funds and business succession funds Venture debt initiatives The Bank of Kyoto alone decided to promote venture debt aiming f
Slide 20: Group-wide Strategy to Meet the Challenge of Change (3)
Group-wide Strategy to Meet the Challenge of Change (3) New business creation project "WILL": Meeting the challenge of change and creating new business by combining the wisdom and ideas of all executives and employees Phase 1 (started in April 2024) After the final selection, the person in charge of
Slide 21: Movement Ahead of Next Medium-Term Management Plan
Movement Ahead of Next Medium-Term Management Plan Early asset accumulation has allowed us to transition to actions aimed at the next medium-term management plan. Results of asset accumulation (April 2023 ~ March 2025 results) (JPY bn) 1,300 Strategic asset 1,100 investment projects 900 Succession t
Slide 22: Lending to SMEs and Individuals
Lending to SMEs and Individuals Policy of reviewing loan portfolios and increasing the share of loans to SMEs and individuals Strengthening sales structure (strategic allocation of human capital) and diversifying products etc. Regional Future Co-Creation Project results Apartment loans Project lau
Slide 23: Structured Finance
Structured Finance In structured finance (SF), both balance and income are growing steadily due to positive initiatives Properly review and promote soundness of borrowers and investees SF (loans) balance SF (loans) portfolio SF (loans) currency composition Asset finance (JPY bn) Target JPY 480bn 0%
Slide 24: Corporate Consulting
Corporate Consulting Continue “Expansion of solution functions” and “expansion of new business domains” to achieve both sustainable growth for our customers and our group. Stages of Establishment period Growth period Stabilization period Period of decline Growth /needs Business Business improvement
Slide 25: Corporate Consulting Results
Corporate Consulting Results Corporate consulting business has taken root, leading to results in corporate revenue Kyoto Soken Consulting is also increasing contracts as its consulting business gets on track Syndicated loans and other revenue M&A fees Business matching fees Kyoto Soken Consulting (J
Slide 26: Personal Consulting
Personal Consulting Enhancing consulting services that utilize "banking, securities, and trust" to achieve best interests of customers Main measures Balance of assets under Group custody Asset-utilizing Inheritance and Target JPY 1.1tr Asset-building Bank demographic, Wealthy (JPY bn) asset successi
Slide 27: Deposits
Deposits Promoting customers changing to main account and further increasing sticky deposits through face-to-face proposal- based sales utilizing the store network and the roll-out of products and services that meet diverse needs Personal deposits Increased personal deposits (term-average) Pension •
Slide 28: Market Operations
Market Operations Flexibly control the balance, focusing on domestic bonds. ➣ The management of domestic bonds aims to shorten the maturity period and simultaneously control the balance in preparation for a rate hike by the Bank of Japan. ➣ The management of foreign bonds will continue to invest in
Slide 29: Shareholder returns
Shareholder returns In FY2024, the total return ratio was 75%, still one of the highest among regional banks In FY2025, the plan is to increase annual dividends by JPY10 to JPY70 and acquire JPY 10 billion of treasury stocks. Dividends per share FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 (Scheduled)
Slide 30: Capital Allocation
Capital Allocation ➣Actively invest in credit risk assets that lead to future growth while implementing appropriate shareholder returns. Meanwhile, considering the ability to withstand unforeseen future crises, set the Equity-to-asset ratio at an appropriate level in the 11% range. Capital Allocatio
Slide 31: Reduction of Strategic Equity Holdings
Reduction of Strategic Equity Holdings We will review the significance of our holdings of all stocks and reduce our strategic equity holdings Target on Reducing Holdings of Securities Held for Strategic Equity October 2024 to March 2029 100.0 billion yen or more (market value) Status of reduction of
Slide 32: Expansion of Shareholder Base and Dialogue with Shareholders and Investors
Expansion of Shareholder Base and Dialogue with Shareholders and Investors Further increase the number of individual shareholders through secondary offering of shares, and continued efforts to engage in dialogue with shareholders and investors Secondary offering of shares (February 2025) Number of i
Slide 33: Initiatives for a Sustainable Society
Initiatives for a Sustainable Society Continuing to promote initiatives to achieve regional sustainability Promotion of regional sustainability Progress on targets management [Sustainable finance targets] [CO2 emission reduction targets (Scope 1 and 2)] Hosted seminars following last year's event
Slide 34: HR Strategy (Human Capital Management) (1)
HR Strategy (Human Capital Management) (1) Measure effectiveness through engagement surveys and deploy measures in a timely manner to "achieve engagement management" Actively recruit human resources to drive the expansion and advancement of business domains Engagement Management: Maximizing the valu
Slide 35: HR Strategy (Human Capital Management) (2)
HR Strategy (Human Capital Management) (2) Further accelerate investment in human resources in order to develop high-level professionals that meet diversifying customer needs Provide career support tailored to what employees want to be, fostering a highly motivated work culture Investment in & train
Slide 36: DX Strategy
DX Strategy Initiatives for transforming to data-driven management Construct a Service Innovation Core (SIC) infrastructure for data collection, analysis, and utilization, strengthen sales and marketing utilizing collected data and AI, enhance screening and risk management, and promote operational
Slide 37: Ⅲ. Reference material
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Slide 38: History of Kyoto Bank (Outline: Establishment to Heisei Eras)
History of Kyoto Bank (Outline: Establishment to Heisei Eras) 昭和 1941 Established Tanwa Bank (％) Market Share with in Kyoto Prefecture Post-war recovery Commissioned to provide main Emergence of venture companies and 1950 depository service for Kyoto subsequent rapid growth Prefecture Loans Establis
Slide 39: Outline of Kinki Region
Outline of Kinki Region Although ranked 13th in terms of economic scale, the Kinki region (Kyoto, Osaka, Hyogo, Shiga, and Nara prefectures), which has a network of stores, has a large economy. Demand for commercial land in Kyoto and Osaka prefectures is high, and land prices are above the national
Slide 40: Attraction of Kyoto Prefecture
Attraction of Kyoto Prefecture Kyoto’s unique and attractive industrial structure is also related to our Group’s business and will lead to business opportunities Kyoto has many technologically advanced high-tech industries. Industry-university High-tech cooperation Industry: Many manufacturing compa
Slide 41: Initiatives to Contribute to Local Communities
Initiatives to Contribute to Local Communities Continued efforts to embody the Management Principle of "Serving the Prosperity of the Community” Promotion of local culture and sports Financial and economic education initiatives [Volunteer float pullers at the Gion Festival, working in a yukata] [Sem
Slide 42: Deposits and negotiable certificates of deposit (Kyoto Bank, Non-consolidated)
Deposits and negotiable certificates of deposit (Kyoto Bank, Non-consolidated) Deposits and negotiable certificates of deposit (term-average) Results of FY2024 (YoY change) Results of FY2024 (YoY change) Corporations JPY-1.4bn Kyoto JPY+71.0bn Individuals JPY+83.6bn Osaka･Hyogo JPY+33.1bn Local gove
Slide 43: Loans and bills discounted (Kyoto Bank, Non-consolidated)
Loans and bills discounted (Kyoto Bank, Non-consolidated) Loans and bills discounted(Term-average) Results of FY2024 (YoY change) Results of FY2024 (YoY change) Corporations JPY+569.1bn Kyoto JPY+206.0bn Individuals JPY+39.5bn Osaka･Hyogo JPY+190.8bn Local governments Financial institutions JPY+19.3
Slide 44: Expenses and OHR
Expenses and OHR Expenses and OHR (Consolidated) Expenses and OHR (Kyoto Bank, non-consolidated) 64.11 65.45 60.02 59.70 59.17 60.75 60.16 58.28 57.65 57.56 OHR OHR (%) (%) (JPY bn) (JPY bn) 56.9 55.3 54.6 53.5 53.6 Personnel 30.3 expense 31.0 30.7 30.5 30.7 61.2 56.9 55.7 56.1 58.0 Non- 20.6 22.4 p
Slide 45: Comprehensive Risk management
Comprehensive Risk management Interest rate risk in the banking book Status of Comprehensive Risk Amount (As of the end of March 2025) (As of the end of March 2025) Delta EVE As part of the Risk Appetite Framework, the company confirms Delta EVE Equity /Equity that risk-taking (amount of integrated
Slide 46: Efforts to Improve Corporate Value
Efforts to Improve Corporate Value By implementing various measures to improve ROE and reduce shareholder capital costs, we aim to enhance corporate value. ■ Significant accumulation of ➢ Strategy development by P.20 risk assets launching strategic RORA Strengthening ■ Increase in service income imp
Slide 47: BPS
BPS Annualized (Compounded) 4,500.0 7.68％ Changes in BPS 4,024yen *After Cumulative Dividend 4,000.0 Enhancement 3,734yen 3,500.0 ■ BPS ■Cumulative dividend Annualized (Compounded) 3,000.0 6.95％ 2,500.0 2,000.0 1,783yen 1,500.0 1,000.0 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 F
Slide 48: Group Companies
Group Companies Main Business Kyoto Financial Group, Inc. Business management of group companies The Bank of Kyoto, Ltd. Banking Kyoto Guaranty Service Co., Ltd. Credit guarantee Sky Ocean Asset Management Co., Ltd. (The Bank of Kyoto’s Equity Method Associate) Investment management Karasuma Shoji C
Slide 49: Governance Structure
Governance Structure Election and dismissal General Meeting of Shareholders Election and dismissal Election and dismissal Kyoto Financial Group Consultation Group Nomination and Cooperation Compensation Committee Report Board of Directors Audit and Supervisory Committee Sustainability Management Cou
Slide 50: Inquiries
This material has been translated from the Japanese-language original for reference purposes only. In the event of any conflict or discrepancy between this document and the Japanese-language original, the Japanese-language original shall prevail in all respects. And This material contains descriptio