Bank Of The Ryukyus,limited · TSE:8399
Bank Of The Ryukyus,limited — FY2020 Earnings Presentation
37 slides from Bank Of The Ryukyus,limited's earnings presentation, May 2021
Slide 1: Financial Results for FY 2020
2 FREKERIT IL TS BANK OF THE RYUKYUS GROUP Financial Results — = for FY 2020
Slide 2: Contents
BANK OF THE RYUKYUS GROUP | Contents em RRL —7 1. Okinawa’s Economy Amid the COVID-19 Crisis Tankan Survey ae aeettees 4 AssetsinCustody aeaeetes 21 Tourism nena 5 Corporate Customer Services| —huueaeaeee 22 Unemployment Rates, Job-openings-to-applicants Card-related Business (1/2) hataensene 23 Rat
Slide 3: Okinawa's Economy Amid the COVID-19 Crisis
BANK OF THE RYUKYUS GROUP FREER IT TIL —SF Q S) inawa’ : Ok ets % ¥ , Economy Am -19 the COVID } 4 & 3 = ce @ “
Slide 4: Tankan Survey
| Tankan Survey 2 FREK ERT ILS BANK OF THE RYUKYUS GROUP Tourism, which is a key industry in Okinawa Prefecture, declined significantly. Business Sentiment DI (Good/Bad) Following Major Pros- Prior to Major Spread of COVID-19 Spread of COVID-19 _ pects 41 —e—Nationwide P —®— Okinawa iS 27 + - 16 -10
Slide 5: Tourism
2 FREK ERT ILS BANK OF THE RYUKYUS GROUP | Tourism During FY 2020, two national state-of-emergency declarations and three Okinawa Prefecture declarations were made. The resulting movement restrictions significantly affected tourism, greatly bringing down numbers of tourists. (Yellow-shaded portions
Slide 6: Unemployment Rates, Job-openings-to-applicants Ratios, and Corporate Bankruptcies
Unemployment Rates, Job-openings-to-applicants Ratios, and om HIKE TS Corporate Bankruptcies 2 a BANK OF THE RYUKYUS GROUP Declining demand in tourism, a key Okinawa Prefecture industry, and other such negative developments have led to increased unemployment rates and decreased job-openings-to-appli
Slide 7: Public Construction Contract Amounts and Numbers of New Housing Construction Projects Started
Public Construction Contract Amounts and Numbers of New o 2) FRFKER IT ILS Housing Construction Projects Started A Sa = BANK OF THE RYUKYUS GROUP New public construction contract amounts remained strong despite the spread of COVID-19. Numbers of new housing construction projects were weak overall, p
Slide 8: Financial Results for the Fiscal Year Ended March 31, 2021
Oy FiFKERIT I) Q BANK OF THE RYUKYUS GROUP 2 Financial Results for the Fiscal Year Ended March 31, 2021 } wits : N 'Rebeived! an ht,
Slide 9: Financial Summary (Consolidated) (1/2)
| Financial Summary (Consolidated) (1/2) 2 FRERERIT TI IL—-SF BANK OF THE RYUKYUS GROUP Revenue and profit decreased. Consolidated profit also decreased due to our bank’s situation. (100 million yen) Financial Results for FY 2020 FY 2019 i Year-on-year | change Ordinary revenue 572 -55 627 Ordinary
Slide 10: Financial Summary (Consolidated) (2/2)
| Financial Summary (Consolidated) (2/2) 2 FRERERIT TI IL—-SF BANK OF THE RYUKYUS GROUP Financial conditions for Bank of the Ryukyus Group companies were as follows. (100 million yen) Okinawa ; Bank of the Ryukyu ; ; Ryugin Ryukyus Leasing Ryugin DC sean Hosho Others ervice Ordinary revenue 373 171
Slide 11: Financial Summary (Non-Consolidated)
| Financial Summary (Non-Consolidated) SD EKMA TF BANK OF THE RYUKYUS GROUP Revenue and profit decreased. Credit costs increased due to revision of standards for provisions to doubtful accounts. (100 million yen) Financial Results for FY 2020 FY 2019 | Year-on-year change Ordinary revenue 373 | -51
Slide 12: Summary of Profit/Loss Trends
| Summary of Profit/Loss Trends 2B HEIRGRIG-IL (Non-Consolidated: March 2017 to March 2021) pasado nieeriad Wea (Million yen) i 2057 | ar 2018 | ar 2019 | ar 2020 | Mar 2021 | Yearon Year| Profit from customer services” 3,325 3,395 3,472 3,619 3,835 +216 Deposit and loan balance’? 22,127 21,890 22,2
Slide 13: Profit/Loss During the Fiscal Year Ended March 31, 2021
Increased credit costs Decreased profits/losses by Trading Division Increased profit from customer services
Slide 14: Profit from Customer Services
Rising expenses Service charge profit grew Growing deposit and loan balance
Slide 15: Loans (1/2)
J Loans (1/2) 2 FRERERIT TI IL—-SF BANK OF THE RYUKYUS GROUP COVID-19-related funding support and other measures led to balance growth, but yields declined. Loan Balance mame Syndicated loans mam Local gov'ts, others (excl. syndicated loans) (100 million yen) = Corporate (excl. syndicated loans) 15,
Slide 16: Loans (2/2)
| Loans (2/2) FRERERIT TI IL—-SF BANK OF THE RYUKYUS GROUP COVID-19-related funding support and other measures brought about pronounced declines in yields from business loans. (100 million yen) Syndicated Loans (%) 1,500 - — 5 0.75 Breakdown of Loan Balances by Use a ice Rate (ght ts) Syndicated 1,0
Slide 17: COVID-19 Crisis Financial Support (1/2)
| COVID-19 Crisis Financial Support (1/2) 2 FREK ERT ILS BANK OF THE RYUKYUS GROUP We have pursued proactive credit condition changes, new financing measures and other financial measures support to help our customers during the COVID-m19 crisis. Amounts for Credit Condition Changes in (100 million y
Slide 18: COVID-19 Crisis Financial Support (2/2)
| COVID-19 Crisis Financial Support (2/2) o® iM YY BANK OF THE RYUKYUS GROUP We have provided proactive support for our customers in response to continuing spread of COVID-19. (No. of Persons) Okinawa Prefecture COVID-19 Infection Numbers and Our Response Measures 20208 f 2020/10 2020/11 = 2020/12 2
Slide 19: Deposits
| Deposits 2 FREER IT TIL —SF BANK OF THE RYUKYUS GROUP COVID-19-related funding support, cash handouts and other such measures led to major balance increases. (100 million yen) 25,000 20,000 15,000 10,000 5,000 Balance of Deposits ma |n dividual me Commercial mam Public funds, etc. 25,200 —#®— Inte
Slide 20: Profit from Service Charges
Decreased service charge profit from assets in custody Others Increased profit from card-business service charges Increased profit from corporate customer service charges Increased profit from mortgage loan service charges
Slide 21: Assets in Custody
| Assets in Custody ee Sales for investment trusts and single-premium life insurance declined due to government calls for people to refrain from face-to-face meetings and activities (as a COVID-19 countermeasure). Assets on Custody Sales Revenues Assets in Custody Balance - m Single-premium life ins
Slide 22: Corporate Customer Services
&B FREKERIT OILS BANK OF THE RYUKYUS GROUP | Corporate Customer Services We made effective use of customer data provided by sales offices and increased revenue from fees by accepting greater numbers of consultation requests. (Million yen) Service Fees for Corporate Customers 1,000 - Structured Finan
Slide 23: Card-related Business (1/2)
| Card-related Business (1/2) 2 FREER IT TIL —SF BANK OF THE RYUKYUS GROUP Numbers of card members and affiliates are growing steadily. Visa debit card affiliate numbers also exhibit growth. We expect more than 500 million yen of profit from card-related service charges in FY 2021. Numbers of Visa D
Slide 24: Card-related Business (2/2)
| Card-related Business (2/2) &B FREKERIT OILS BANK OF THE RYUKYUS GROUP Numbers of new members grew for Visa debit cards with contactless payment functionality. Payment terminal functions are becoming increasingly sophisticated at card-affiliate locations as we accelerate efforts to sign up new aff
Slide 25: Securities (1/2)
qe yr) sy 4=> J L— | Securities (1/2) SSS a Increases in local government bonds grew the balance while shortening of bond duration periods kept interest rate risk down. Securities Balances and Deflation mam Stocks, ETFs, investment trusts mas Government bonds ma Local government bonds mmm Corporate
Slide 26: Securities (2/2)
| Securities (2/2) Oy FiFKERIT I) 2 BANK OF THE RYUKYUS GROUP Amid forecasts of decreases in net income, the Trading Division focused on a thoroughly risk-off approach. (100 million yen) 50 40 30 20 10 -10 Mar. 2017 Profit/loss in Trading Division mlm Gains/losses from trading forex and trading acco
Slide 27: Net Credit Costs and Disclosed Bad Debt
| Net Credit Costs and Disclosed Bad Debt SQ MHRA 7 We switched to a forward-looking estimation method for the general provision for doubtful accounts in FY 2020, ensuring sufficient provisions to handle potential expanded future risk. Net Credit Costs Disclosed Bad Debt wm Lan amounts written off (
Slide 28: Overview of Forward-looking Provisioning (1/2)
&B PHREKERIT AILS | Overview of Forward-looking Provisioning (1/2) ae eee By switching to a more rational estimation method for future risk calculation that takes current and future information into consideration, we have strengthened our standing against future potential loss and risk. This bolster
Slide 29: Overview of Forward-looking Provisioning (2/2)
| Overview of Forward-looking Provisioning (2/2) rer ohnoe We determine provisions in a manner suited to each individual industry affected by the COVID-19 pandemic. Overall Real Estate Industry 100 million (100 million yen) (100 million yen) , . . (100 million yen) ey mmm Claim amount (left axis) ~®
Slide 30: Expenses
| Expenses 2 FREK ERT ILS BANK OF THE RYUKYUS GROUP Expenses increased due to forward-looking investments in our card-related business and construction costs for the new headquarters. We expect reduced labor costs from the next fiscal year onward. Expenses (100 million yen) 250 200 150 100 50 mLabor
Slide 31: Workforce Planning
| Workforce Planning 2 FREK ERT ILS BANK OF THE RYUKYUS GROUP We expect workforce reductions from the next fiscal year onward to lead to reduced labor costs. At the same time, reductions in administrative workloads will increase productivity per employee while bringing down labor costs and strengthe
Slide 32: Dividends
BANK OF THE RYUKYUS GROUP | Dividends a HIKER TILT” With consideration for Bank profit level recovery, we plan to pay FY 2021 interim dividends equivalent in amount to FY 2019 payments. Yi _ . woe . (Yen) Annual Dividends Per Share (%) Consolidated Dividend Payout Ratios 50 50.0 - —®—Consolidated di
Slide 33: Capital Adequacy Ratio
| Capital Adequacy Ratio Oy FiFKERIT I) 2 BANK OF THE RYUKYUS GROUP Because improvements to capital adequacy ratio are key for enabling financial support during the COVID-19 crisis, we will strive to build up greater capital in internal reserves. (100 million yen) 1,800 1,500 1,200 900 600 300 Non-c
Slide 34: Forecast for FY 2021 (Ending March 31, 2022)
| Forecast for FY 2021 (Ending March 31, 2022) 2) PFREKERIT TIL TS BANK OF THE RYUKYUS GROUP Profit growth is forecasted for both non-consolidated and consolidated financial results due to improvements in credit costs and other areas. Non-Consolidated Ordinary revenue Ordinary profit Net income Cons
Slide 35: Midterm Management Plan Target Revisions
| Midterm Management Plan Target Revisions 2) PFREKERIT TIL TS eS BANK OF THE RYUKYUS GROUP In response to loan yields falling below expectations due to our proactive support for customers affected by the COVID-19 crisis, we have lowered our deposit and loan balance targets. In contrast, we have rev
Slide 36: Post-revision Deposit and Loan Balance, and Profit from Service Charges
Post-revision Deposit and Loan Balance, and Profit from Service gow sa 3¢ en yy) > Ch arges BANK OF THE RYUKYUS GROUP Loan rate declines fell below expectations, leading to a deposit and loan balance on par with FY 2020. Card business profit remained strong despite the COVID-19 pandemic, and service
Slide 37: About This Document
| About This Document SB HRT 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 document is on a non-consolidated basis unless otherwise specified. In