Bank Of The Ryukyus,limited · TSE:8399
Bank Of The Ryukyus,limited — FY2019 Earnings Presentation
47 slides from Bank Of The Ryukyus,limited's earnings presentation, Jun 8, 2020
Slide 1: Bingata Design Contest technical mention
Received a technical mention in the 28th (fiscal 2019) Bingata Design Contest “Flowers Blossoming on the Way Home” by Hiroko Kyan
Slide 2: Economic Overview of Okinawa Prefecture
1 Economic Overview of Okinawa Prefecture * Annual statistical indicators are based on the calendar year.
Slide 3: Tankan Survey
Tankan Survey Like in other prefectures, business confidence in Okinawa fell significantly due to Covid-19. Business Sentiment DI (Good/Bad) Cash Flow Sentiment DI (Good/Bad) Nationwide Okinawa Nationwide Okinawa 60 30 40 End Mar. ’20 25 1 End Mar. ’20 20 20 +14 0 15 20 10 End Mar. ’20 End Mar. ’20
Slide 4: Tourism
2020/3 Tourism The number of tourists for FY2019 significantly decreased compared to the previous fiscal year due to Covid-19. Cruise ship calls reached an all-time high in 2019 (calendar year) but the number is expected to decrease in the future. Number of Tourists and Tourism Revenues Number of Cr
Slide 5: Population, Number of Households, and Housing Starts
Population, Number of Households, and Housing Starts Okinawa’s population is expected to grow until 2025, while the number of households is expected to keep growing onward. The number of new housing starts will decline as a whole due to the significant decrease in rental housing. Okinawa’s Future Po
Slide 6: Real Estate
Real Estate Growth rate of land prices and unit construction costs have surpassed the national average. Price Growth Rate of Residential Areas Unit construction cost (%) Nationwide Okinawa +9.5% 10.0 (10,000 yen/m2) 24.9 25.0 5.0 Nationwide Okinawa +0.8% 0.0 5.0 22.3 22.5 22.2 10.0 1995 2000 2005 20
Slide 7: Employment
Employment Employment has improved, with the unemployment ratio declining up to 2019. The labor shortage is also currently improving due to Covid-19. Job-openings-to-applicants Ratio and Employment Sentiment DI (Good/Bad) (%) Unemployment Ratio (Times) 2.00 Job openings-to-applicants ratio 10 10 Une
Slide 8: Economic Trends in Okinawa Prefecture
Economic Trends in Okinawa Prefecture Economic conditions in Okinawa Prefecture worsened significantly (in April) mainly in the tourism-related industry, which is likely to be greatly affected by Covid-19. Consumption-related Situation The sales proceeds of department stores decreased year on year
Slide 9: Financial Results for Fiscal Year Ended March 31, 2020
2 Financial Results for Fiscal Year Ended March 31, 2020
Slide 10: Financial Summary (Non-Consolidated)
Financial Summary (Non-Consolidated Revenue increased, but profit decreased. The decrease in profit is due to increased net credit costs and reduced profit/loss balance in the Trading Division. (100 million yen) FY2019 FY2018 Year-on-year change Ordinary income 424 +4 420 Business gross profit 315 +
Slide 11: Financial Summary (Consolidated)
Financial Summary (Consolidated Revenue increased, but profit decreased. Consolidated profit also decreased due to our bank’s situation. (100 million yen) FY2019 FY2018 Year-on-year change Ordinary revenue 627 +6 621 Ordinary expenses 558 +24 534 Ordinary profit 69 17 86 Profit attributable to 49 12
Slide 12: Summary of Profit/Loss Trends (Non-consolidated)
Summary of Profit/Loss Trends (Non-consolidated: Mar. 2016–Mar. 2020) (Million yen) End Mar. ’16 End Mar. ’17 End Mar. ’18 End Mar. ’19 End Mar. ’20 Year on Year Profit from customer services *1 5,312 3,325 3,395 3,472 3,619 +147 Deposit and loan balance *2 22,901 22,127 21,890 22,278 22,837 +559 Pr
Slide 13: Profit/Loss during Fiscal Year Ended March 31, 2020
Profit/Loss during Fiscal Year Ended March 31, 2020 The profit from customer services increased, but total profit decreased due to increased net credit costs and decreased profit/loss balance in the Trading Division. Net income Factors Increasing and Decreasing (100 million yen) (Million yen) Year o
Slide 14: Profit from Customer Services
Profit from Customer Services Expenses increased, but total profit increased due to increased deposit and loan balance and profit from service charges. Profit from Customer services Factors Increasing and Decreasing Profit from service charges (excl. loan-related fees) from FY 2018 Expenses (100 mil
Slide 15: Loans
Loans Although the yield declined, the balance steadily increased, resulting in an increase in loan interest income for two consecutive periods. SyndicatedLoan loans Balance Factors Increasing and Decreasing Loan (100 million Local government and other (excl. syndicated loans) (100 million Interest
Slide 16: Loans
Loans The balance of mortgage loans, especially rental housing and lending to real estate agents, is increasing. The interest rate charged to borrowers is tending to decline. Syndicated loan Real estate-related loans BREAKDOWN OF LOAN (100 million yen) Balance (%) (100 million yen) Balance (%) Inter
Slide 17: Deposits
Deposits Deposits for both retail and corporate customers are steadily increasing. Annual percentage yield dropped due to a decline in time deposit balances. (%) Balance of deposits Annual percentage yield 0.10 Public funds, etc. 0.08 (100 million yen) Commercial (100 million yen) 0.06 Retail 25,000
Slide 18: Profit from Service Charges
Profit from Service Charges Profit from service charges is steadily increasing due to increased service fees for corporate customers and card-related services. Trend of Profit from Service Charges (excl. group credit life Percentage of Service Fees for Corporate insurance premiums and loan guarantee
Slide 19: Assets in Custody
Assets in Custody The balance of assets in custody turned negative due to a decline in net asset values of mutual funds or other factors. Assets on custody sales revenue Assets in custody balance (100 million Single-premium life insurance Investment trusts (100 million Investment trusts Government b
Slide 20: Expenses
Expenses Personnel expenses decreased due to a reduction in number of personnel. Non-personnel expenses increased due to investment to streamline operations and ensure various revenue sources. Expenses Breakdown of non-personnel expenses Others Personnel Expenses Non-personnel expenses Taxes (100 mi
Slide 21: Securities
Securities The profit/loss balance in the Trading Division decreased due to the decreased profit from forex trading, balance of three share accounts, interest and dividends, etc. Profit/loss in Trading Division Securities investment yield Gains/losses from trading in forex and trading account securi
Slide 22: Securities
Securities An increase in local government bonds led to the prolonged duration of the bonds. The securities balance moved to a risk-off position. Securities balance Difference between market value and Stocks, ETF, investment trusts book value of securities Government bonds Local government bonds Cro
Slide 23: Net Credit Costs/Disclosed Bad Debt
Net Credit Costs/Disclosed Bad Debt The general provision for doubtful accounts and substandard claims increased due to Covid-19 (changes of conditions, etc.). Net credit costs Disclosed bad debt Recoveries of written-off claims Other processing costs (100 million yen) Loan amount written off (100 m
Slide 24: Capital Adequacy Ratio
Capital Adequacy Ratio The capital adequacy ratio increased due to stronger management of risk assets in addition to accumulation of profit and allowance for doubtful accounts. Regulatory capital and capital adequacy rate Risk assets (100 million yen) Loan Department Others Subordinated debt portion
Slide 25: Profit from Customer Services Plan
Profit from Customer Services Plan Although expenses increased due to continued necessary investments, profit is expected to grow due to improved balance of deposits and loans and increased profit from service charges. Profit from customer services Factors increasing and Decreasing Profit from servi
Slide 26: Concept and Planning for Securities Operations
Concept and Planning for Securities Operations Operations of securities reduce risks, ensuring further profit gains. Average Securities Balance Profit/Loss Balance in Trading Division Others Gains/losses from trading in forex and trading account securities Yen-denominated bonds Foreign bonds Stocks
Slide 27: Responses to Covid-19
Responses to Covid-19 Actively committed to supporting customers in terms of funding. Customers will continue to be affected by Covid-19 during FY2020. Changes in Credit Conditions General Provision for (100 million yen) (100 million yen) Doubtful Accounts 1,600 Total credit costs 25 Net provision T
Slide 28: Net Income and Capital Adequacy Ratio in FY2020 Plan
Net Income during the Period and Capital Adequacy Ratio in FY2020 Plan Net income is decreasing. The capital adequacy ratio is expected to remain nearly flat. Factors Increasing and Decreasing for Capital adequacy rate Net Income during the Period (fully implemented under Base (100 million yen) (%)
Slide 29: Forecast for FY 2020 (ending March 31, 2021)
Forecast for FY 2020 (ending March 31, 2021) Profit is expected to decline for both non-consolidated and consolidated financial results due to Covid-19. Non-consolidated (100 million yen) FY 2020 (ending Mar. ’21) FY 2019 (ended Mar. ’20) Forecast Year on Year Results Ordinary income 395 29 424 Ordi
Slide 30: Business Strategy
* 3 Business Strategy
Slide 31: Mid-Term Management Plan (Basic Strategy for SINKA 2020)
Mid-Term Management Plan (Basic Strategy for SINKA 2020) This Mid-Term Management Plan focuses on four basic strategies based on the understanding of the current situation. Direction of the Management Strategy based on Understanding of the Current Situation the Awareness of the Current Situation Env
Slide 32: Mid-Term Management Plan (Individual Strategies for SINKA 20)
Mid-Term Management Plan (Individual Strategies for SINKA 2020) Nine individual strategies have been created based on four basic strategies. 4 Basic Strategies 1. Channel Strategy* Structure IT Investment Revenue Category Think and 2. Cashless Strategy* Act IT Investment Brand Think and Structure IT
Slide 33: Channel Strategy (Promoting Non-Face-to-Face Services)
Channel Strategy (Promoting Non-Face-to-Face Services) Reducing fixed costs by promoting “branch-in-branch (multiple branches in one location)” and releasing a mobile banking app. Reduction in the number of branch offices and ATMs Development of a mobile banking app Newly joined TSUBASA Alliance o
Slide 34: Cashless Strategy (Ryugin Visa Debit Card)
Cashless Strategy (Ryugin Visa Debit Card) Offering new functional cards such as corporate cards and contactless cards, to expand the number of our card customers. Number of Customers of Ryugin Visa Debit Card (Number (Number of cards) of cards) Issuance of Ryugin Visa Debit Card (Oct. 2015) Retail
Slide 35: Cashless Strategy (Card Affiliates)
Cashless Strategy (Card Affiliates) Speeding up the process of gaining card affiliates to realize “Cashless Islands.” (Number of affiliates) Efforts to Realize “Cashless Islands” 10,000 Number of Card Affiliates Results¬ ®Forecast Acquiring: enabling all kinds of payment to 8,000 be completed with o
Slide 36: Cashless Strategy (Easy Card)
Cashless Strategy (Easy Card) Allowing “Easy Cards,” which have the largest share in Taiwan, to be used in Japan and seeking to promote use of the card across the nation. Deployment Schedule for Easy Cards Creation of a platform for accepting Easy 2020 Apr May Jun Jul Aug Sep Oct Nov Cards and domes
Slide 37: Retail Business Strategy (Streamlining Sales of Assets in Custody)
Retail Business Strategy (Streamlining Sales of Assets in Custody) Actively installing new systems to reduce administrative workload for staff, and strengthening the sales capability by using resources. Installing a system that Installing a negotiation recording system Applications for investment in
Slide 38: Retail Business Strategy (Inheritance Support Services)
Retail Business Strategy (Inheritance Support Services) Approaching new/unexplored customers through inheritance consulting services for high-net-worth individuals, and testamentary-trust services, and inheritance procedure support services. Started property inheritance consulting services for Start
Slide 39: Retail Business Strategy (Development of Attractive Products)
Retail Business Strategy (Development of Attractive Products) Providing new products that accurately meet potential needs of customers to broaden their options. Reverse Mortgages (Apr. 2015) Ryugin ECO Passbook (Feb. 2019) Loans for elderly aged 60 and older with no upper age limit “Ryugin ECO P
Slide 40: Corporate Business Strategy (Business Potential Evaluation and Sales)
Corporate Business Strategy (Reviewing the preparedness for business potential evaluation and sales) Sales offices focus on customer visits due to centralization of the work of preparing loan application documents in headquarters, providing the best solutions to customers. Reviewing the preparedness
Slide 41: Corporate Business Strategy (Strengthening Solution Sales Capabilities)
Corporate Business Strategy (Strengthening Solution Sales Capabilities) Making effective use of customer data received from sales offices, and increasing income revenue from fees by accepting more requests for consultation. (Million yen) Service Fees Established the Corporate Business Division (Apr.
Slide 42: Visions of Sales Offices (FTB Project/Flat Cash Counter System)
Visions of Sales Offices (FTB Project/Flat Cash Counter System) Greatly reducing the administrative workload, and striking a balance between reducing labor costs and strengthening communication with customers. Working toward reducing staff FTB (Flexible & Traditional Bank) Project Reducing the lab
Slide 43: Human Resource Strategy (Reviewing the Personnel System)
Human Resource Strategy (Reviewing the Personnel System) Revitalizing our bank organization by providing employees with opportunities to discover career paths that enhance their expertise and promoting diversification. Deploying the employee training system by field (Apr. 2019) (Number of Eliminat
Slide 44: Human Resource Strategy (Efforts for Health Management)
Human Resource Strategy (Efforts for Health Management) Promoting employees’ health to improve revitalization and productivity in our bank. Creating a Health Management Declaration (Oct. 2019) Support for Quitting Smoking/Efforts to Prohibit Created a Health Management Declaration that provides ac
Slide 45: Group Brand Strategy (New Headquarters Project)
Group Brand Strategy (New Headquarters Project) Consolidating our group’s headquarters functions with a comprehensive strength. Receiving payments for rental charges, resulting in reducing a certain degree of operation costs. Rebuilding of our headquarters building (to be completed in January 2025)
Slide 46: We appreciate your continued support for our bank.
We appreciate your continued support for our bank.
Slide 47: About This Presentation
About This Presentation Contact information for questions about this document: General Planning Department, Bank of the Ryukyus, Limited Tel 098-860-3787 Fax 098-862-3672 E-mail ryugin@ryugin.co.jp The information in this presentation is on a non-consolidated basis unless otherwise specified. Inform