Consolidated Financial Summary (Japanese GAAP)
for the Six Months Ended September 30, 2014
November 14, 2014
Sony Financial Holdings Inc.
(URL: http://www.sonyfh.co.jp/web/index_en.html)
Stock exchange listing: Tokyo Stock Exchange (code number: 8729)
Representative:
Katsumi Ihara, President and Representative Director
Inquiries:
Masaaki Konoo, General Manager—Corporate Communications & Investor Relations Dept.
(Fractional amounts of less than ¥1 million are discarded.)Company name:

1. Consolidated financial results for the six months ended September 30, 2014
(1) Operating results
Ordinary Revenues
Ordinary Profit

Net Income

Millions of yen% change

Millions of yen% change

Millions of yen% change

643,065

5.2

46,96727.6

31,18049.3

611,12111.7

36,81010.9

20,884

5.9

For the six months ended
September 30, 2014
For the six months ended
September 30, 2013
Note: Comprehensive Income:For the six months ended September 30, 2014: ¥44,785million:
For the six months ended September 30, 2013: ¥13,505million:

Net Income per
Share(Fully Diluted)

Net Income per
Share
Yen

For the six months ended
September 30, 2014
For the six months ended
September 30, 2013231.6％(57.9)％

Yen

71.68

—

48.01

—

(2) Financial conditions
Total Assets

Total Net Assets

Net Asset Ratio

Millions of yen

Millions of yen%

As of September 30, 2014

9,120,226

504,752

5.5

As of March 31, 2014

8,841,382

467,050

5.3

Note: Shareholders' equity:

As of September 30, 2014: ¥503,459 million
As of March 31, 2014:¥465,775 million

2. Dividends
Dividend per Share

Record date
For the year ended
March 31, 2014
For the year ending
March 31, 2015
For the year ending
March 31, 2015
(forecast)

1st quarter2nd quarter3rd quarter

Year-end

Annual Total

Yen

Yen

Yen

Yen

Yen

—

0.00

—

0.00

—

30.00

30.00

—

40.00

40.00

Note: Changes in dividend forecast since the most recent public announcement: None

3. Forecast of consolidated financial results for the year ending March 31, 2015
(Percentage figures represent changes from the results of the previous fiscal year.)Ordinary Revenues
For the year ending
March 31, 2015

Ordinary Profit

Net Income per
Share

Net Income

Millions of yen% change

Millions of yen% change

Millions of yen% change

1,191,000(9.8)

77,0001.1

49,00021.0

Yen

112.64

4. Notes(1) Changes in scope of consolidation during the period under review (changes in specified subsidiaries accompanying changes inscope of consolidation): None
(2) Changes in accounting policies, accounting estimates and restatements of the consolidated financial statements(a) Changes in accounting policies resulting from the revision of the accounting standards and other regulations: Yes(b) Changes in accounting policies due to other reasons: None(c) Changes in accounting estimates: None(d) Restatements of the consolidated financial statements: None
Note: For details, please refer to the section entitled “1. Changes in accounting policies, accounting estimates and restatements of the consolidated
financial statements” under “I. Notes Regarding Summary Information” on page 2 of the attachment.

(3) Number of shares outstanding (common stock)(a) Number of shares outstanding (including treasury shares)
As of September 30, 2014:
As of March 31, 2014:(b) Number of treasury shares
As of September 30, 2014:
As of March 31, 2014:(c) Weighted-average number of shares
For the six months ended September 30, 2014:
For the six months ended September 30, 2013:

435,000,000 shares
435,000,000 shares
55 shares
1 share434,999,945 shares
434,999,999 shares

Status of quarterly review proceduresInterim financial statements in this document are exempt from audit procedure based upon the Financial Instruments and ExchangeAct. Audit procedures are underway as of the date of this report.

Content of Supplemental Materials
I.

Notes Regarding Summary Information
1.
2.

II.

III.

Changes in accounting policies, accounting estimates and restatements of the consolidated
financial statements・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

2

Additional Information・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

2

Consolidated Financial Statements
1.

Consolidated Balance Sheets・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

2.

Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

3(Consolidated Statements of Income) ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

5(Consolidated Statements of Comprehensive Income) ・・・・・・・・・・・・・・・・・・・・

8

3.

Consolidated Statements of Changes in Net Assets ・・・・・・・・・・・・・・・・・・・・・・

9

4.

Segment Information・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 11

5.

Subsequent Events・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 12

Attachment
Consolidated Financial Results for the Six Months Ended September 30, 2014 and Sony Life’s
Market Consistent Embedded Value as of September 30, 2014・・・・・・・・・・・・・・・・・・・・・・・ 14* The Conference Call for explaining the Sony Financial Group financial results will be held at 15:30 (Tokyo),
November 14, 2014.
We are sorry for any inconvenience that our Conference Call will be held only in Japanese.
We will upload the Presentation Materials with speech text on November 14, 2014 after 14:00, and its Q&A
summary at a later date on Earnning Releases and Presentation Materials page on our website:
http://www.sonyfh.co.jp/en/financial_info/results/* On November 14, 2014, SFH’s significant subsidiaries: Sony Life Insurance Co., Ltd. (Sony Life), Sony
Assurance Inc. (Sony Assurance) and Sony Bank Inc. (Sony Bank) will announce their financial results forthe six months ended September 30, 2014. SFH prepared an English-language summary of those Japanese
announcements made by the above subsidiaries, solely for convenience of non-Japanese readers.

1

I. Notes Regarding Summary Information
1. Changes in accounting policies, accounting estimates and restatements of the consolidated financial statements
Changes in accounting policies(Application of Accounting Standards for Retirement Benefits)
The Sony Financial Group has applied Clause 35 of the “Accounting Standards for Retirement Benefits” (ASBJ Statement No. 26,
May 17, 2012) and Clause 67 of the “Guidance on Accounting Standards for Retirement Benefits” (ASBJ Guidance No. 25, May
17, 2012) from the first half of the fiscal year under review. Accordingly, the Company has reviewed its calculation method ofretirement benefit obligations and service costs, changed the method of attributing expected benefit to periods from the point basis
and straight-line basis to the benefit formula basis, and changed the method of determination of the discount rate. Primarily, thischange was from a discount rate based on a number of years approximately equal to the average remaining service period to aweighted average discount rate for expected retirement benefit payment periods and the expected payment amount for each
expected payment period.
Following Clause 37 of the “Accounting Standards for Retirement Benefits,” which stipulates transitional treatment of the newstandard, the effect of the change in the calculation method of retirement benefit obligations and service costs is adjusted inretained earnings at the beginning of the current fiscal year.
As a result, at the beginning of the six months of the fiscal year under review, net defined benefit liability decreased ¥8,341
million, deferred tax assets fell ¥2,651 million, net defined benefit asset increased ¥274 million, and retained earnings grew ¥5,965
million. Ordinary profit and income before income taxes for the six months ended September 30, 2014, declined ¥115 million.
2. Additional Information(Changes in presentation method)
In the past, the Sony Financial Group included amounts of interest on interest rate swaps and the like, which are hedging
instrument gains (losses) resulting from interest rate risk hedging on available-for-sale securities, within “Other operating income”
and “Other operating expenses” for the Banking Business. From the first half of the fiscal year under review, the Group has instead
included these amounts in “Interest income” and “Interest expenses.”
The Sony Financial Group made this change to clarify hedging effectiveness by correlating the gains (losses) of hedged assets
with the losses (gains) of the hedging instrument. The Group made this change because of the growing importance of hedgetransactions following an increase in the bond investment balance that is hedged.
As a result, ¥782 million presented as “Other operating expenses” in the consolidated statements of income for the six months ofthe previous fiscal year has been restated to ¥334 million for “Other operating income” and ¥1,116 million for “Interest expenses.”2

II. Consolidated Financial Statements
1. Consolidated Balance Sheets(Millions of yen)
As of March 31, 2014

As of September 30, 2014

AssetsCash and due from banks¥204,546¥115,818

Call loans and bills bought

40,62842,915

Monetary trusts

325,831

330,317

Securities

6,822,151

7,104,296

Loans

1,211,638

1,250,640

Tangible fixed assets

71,565

123,669

Intangible fixed assets

36,774

34,772

Goodwill

179

139

Others36,59534,633Due from reinsurers

158

663

Foreign exchanges

7,752

6,499

Other assets

100,503

98,069Net defined benefit asset

1,730

2,130

Deferred tax assets

19,872

12,121

Reserve for possible loan losses(1,769)(1,688)¥8,841,382¥9,120,226

Total Assets3

(Millions of yen)
As of March 31, 2014

As of September 30, 2014

Liabilities
Policy reserves and others¥6,263,315¥6,562,536

57,40062,3886,201,676

6,495,867

4,237

4,280

Due to agencies

2,169

2,067

Due to reinsurers

650

534

1,889,970

1,824,588

Call money and bills sold

6,000

6,000

Borrowed money

20,00020,000Foreign exchanges

40

88

Bonds payable

20,00020,000

Other liabilities

95,725

110,683

Reserve for outstanding claims
Policy reserves
Reserve for policyholders' dividends

Deposits

Reserve for employees' bonuses

3,204

2,994

Net defined benefit liability

30,272

22,794250

293

41,65742,287

Reserve for directors' retirement benefits
Special reserves

41,65742,287

Deferred tax liabilities

Reserve for price fluctuations

539

67

Deferred tax liabilities on land revaluation

536

536

8,374,332

8,615,474

Common stock

19,90019,900Capital surplus

195,277

195,277

Retained earnings

164,790

188,885(0)(0)

379,967

404,062

Net unrealized gains (losses) on other securities, net of taxes

92,002

105,066

Net deferred gains (losses) on hedging instruments, net of taxes(2,388)(2,323)

Land revaluation, net of taxes(1,513)(1,513)00Total Liabilities
Net Assets

Treasury stock
Total shareholders' equity

Foreign currency translation adjustments
Remeasurements of defined benefit plans, net of taxes(2,292)(1,833)

Total accumulated other comprehensive income

85,807

99,396

Minority interests

1,275

1,292

Total Net Assets

467,050

504,752¥8,841,382¥9,120,226

Total Liabilities and Net Assets

42. Consolidated Statements of Income and Consolidated Statements of Comprehensive Income(Consolidated Statements of Income)(Millions of yen)
For the six months ended
September 30, 2013

For the six months ended
September 30, 2014

Ordinary Revenues¥611,121¥643,065

Ordinary Revenues from the Life Insurance Business

548,004

578,091

437,395

453,379

437,047

452,610

Income from insurance premiums
Insurance premiums
Ceded reinsurance commissions

348

768

107,436

120,633

Interest income and dividends

58,72165,649

Income from monetary trusts, net

2,674

2,646

Investment income

Gains on trading securities－

91

Gains on sale of securities

1

3,889

Gains on redemption of securities

01

Gains on derivatives, net

172

33

Foreign exchange gains, net

－

1,832

Other investment income

3745,862

46,483

3,171

4,078

44,90046,40744,29745,77444,27945,752

Interest and dividends on deposits of premiums

17

22

Other underwriting income－

0Gains on separate accounts, net
Other ordinary income
Ordinary Revenues from the Non-life Insurance Business
Underwriting income
Net premiums written

Investment income

587

617

Interest income and dividends

591

626

Gains on sale of securities

13

12

Transfer to interest and dividends on deposits of premiums

(17)

(22)

Other ordinary income

15

15

18,216

18,567

13,105

13,121

Interest income on loans

7,059

6,994

Interest income and dividends on securities

Ordinary Revenues from the Banking Business
Interest income

5,993

6,075

Interest income on call loans and bills bought

4

3Interest income on deposits with banks

48

47

Others interest income

0－

Fees and commissions

2,314

2,501

Other operating income

2,719

2,776

Gains on foreign exchange transactions, net

1,501

1,393

Others

1,218

1,383

77

168

Other ordinary income(Continued)

5

(Millions of yen)
For the six months ended
September 30, 2013

For the six months ended
September 30, 2014

Ordinary Expenses¥574,311¥596,097

Ordinary Expenses from the Life Insurance Business

518,707539,035

155,054

173,004

Insurance claims

37,60940,082

Annuity payments

5,106

5,215

Insurance benefits

19,37820,664

Surrender payments

90,410104,652

Other payments

1,616

1,430

933

958

294,006

293,67255

3,882

293,946

289,788

4

1

Investment expenses

3,918

4,428

Interest expenses

24

15

Losses on redemption of securities－

0

Foreign exchange losses, net

91－

Insurance claims and other payments

Reinsurance premiums
Provision for policy reserves and others
Provision for reserve for outstanding claims
Provision for policy reserves
Interest portion of reserve for policyholders' dividends

Provision for reserve for possible loan losses

622

Depreciation of real estate for rent and others

977

920

2,818

3,470

Operating expenses

55,67756,652Other ordinary expenses

10,04911,276

Other investment expenses

Ordinary Expenses from the Non-life Insurance Business

41,70042,642

Underwriting expenses

31,58031,807Net losses paid

23,29922,420Loss adjustment expenses

3,078

3,397

Net commission and brokerage fees

508

481

Provision for reserve for outstanding losses

613

1,105

4,080

4,401

0

0

Provision for underwriting reserves
Others underwriting expenses
Investment expenses

10

Losses on sale of securities－

0

Losses on redemption of securities

1－

10,117

10,832

1

2

Operating, general and administrative expenses
Other ordinary expenses(Continued)

6

(Millions of yen)
For the six months ended
September 30, 2013

For the six months ended
September 30, 2014

¥13,903¥14,420

4,245

4,816

2,411

2,548

Interest expenses on call money and bills sold3

3

Interest expenses on borrowed money

17

11

Interest expenses on bonds

49

49

1,762

2,204

0

0

Fees and commissions

843

937

Other operating expenses

349

83

8,359

8,562

105

20

Ordinary Profit

36,81046,967Extraordinary Losses

4,128

662

Losses on disposal of fixed assets

20

32

Impairment losses

0

0

4,088

630

4,088

630

19

－

62

219

Income Before Income Taxes

32,61846,085

Income Taxes

11,74814,888- Current

10,826

15,982- Deferred921(1,093)

20,87031,197

Ordinary Expenses from the Banking Business
Interest expenses
Interest expenses on deposits

Interest expenses on interest rate swaps
Others interest expenses

General and administrative expenses
Other ordinary expenses

Provision for special reserves
Provision for reserve for price fluctuations
OthersProvision for Reserve for Policyholders' Dividends

Income Before Minority Interests
Minority interests in income (losses)
Net Income

7

(14)

16

¥20,884¥31,180

(Consolidated Statements of Comprehensive Income)(Millions of yen)
For the six months ended
September 30, 2013

For the six months ended
September 30, 2014

¥20,870¥31,197

Net unrealized gains (losses) on other securities, net of taxes(7,878)13,064

Net deferred gains (losses) on hedging instruments, net of taxes

514

64

Foreign currency translation adjustments－

0Remeasurements of defined benefit plans, net of taxes－

459

Share of other comprehensive income of affiliates accounted forusing equity method

00(7,364)

13,588¥13,505¥44,785

Comprehensive income attributable to parent company

13,52044,769Comprehensive income attributable to minority interests

(14)

16

Income Before Minority Interests
Other comprehensive income

Total other comprehensive income
Comprehensive income(Details)

83. Consolidated Statements of Changes in Net Assets
For the six months ended September 30, 2013
(Millions of yen)
Shareholders' Equity
Common stock

Balance at the beginningof the fiscal year
Changes during theperiodCapital surplus

Retained earnings

Total shareholders' equity

Treasury stock¥19,900¥195,277¥135,160－¥350,337

Dividends from surplus－－(10,875)－(10,875)

Net income－－

20,884－

20,884

－

－

－

(0)

(0)

－

－

－

－

－

－

－

10,009(0)

10,009¥19,900¥195,277¥145,170¥ (0)¥360,347

Purchase of treasurystock
Net changes of items
other than shareholders'equityTotal changes during theperiodBalance at the end of thecurrent period

Total accumulated other comprehensive income
Net unrealized
gains (losses) onother securities,
net of taxes

Net deferredgains (losses) on
hedging
instruments,
net of taxes

Landrevaluation, netof taxes

Foreign currencytranslation
adjustments

Remeasurementsof defined
benefit plans, netof taxes

Total
accumulated
othercomprehensive
income¥88,329¥ (3,047)¥ (1,513)－－¥83,767¥1,339¥435,444

Dividends from surplus

－

－

－

－

－

－

－

(10,875)

Net income

－

－

－

－

－

－

－

20,884

－

－

－

－

－

－

－

(0)

(7,878)

514

－

－

－

(7,364)(14)(7,378)(7,878)

514

－

－

－

(7,364)

(14)

2,630

¥80,450¥(2,533)¥ (1,513)－－¥76,403¥1,324¥438,075

Balance at the beginningof the fiscal year
Changes during theperiodPurchase of treasurystock
Net changes of items
other than shareholders'equityTotal changes during theperiodBalance at the end of thecurrent period

9

Minority interests Total Net Assets

For the six months ended September 30, 2014
(Millions of yen)
Shareholders' Equity
Common stock

Balance at the beginningof the fiscal year
Cumulative effects ofchanges in accounting
policies
Restated balance at the
beginning of the fiscal
year
Changes during theperiodCapital surplus

Retained earnings

Total shareholders' equity

Treasury stock¥19,900¥195,277¥164,790¥ (0)¥379,967

－

－

5,965

－

5,965

19,900195,277

170,755(0)385,932

Dividends from surplus－－(13,049)－(13,049)

Net income－－

31,180－31,180

－

－

－

(0)

(0)

－

－

－

－

－

－

－

18,130(0)18,130¥19,900¥195,277¥188,885¥(0)¥404,062

Purchase of treasurystock
Net changes of items
other than shareholders'equityTotal changes during theperiodBalance at the end of thecurrent period

Total accumulated other comprehensive income
Net unrealized
gains (losses) onother securities,
net of taxes

Net deferredgains (losses) on
hedging
instruments,
net of taxes

Landrevaluation, netof taxes

Foreign currencytranslation
adjustments

Remeasurementsof defined
benefit plans, netof taxes

Total
accumulated
othercomprehensive
income¥92,002¥(2,388)¥(1,513)¥0¥(2,292)¥85,807¥1,275¥467,050

－

－

－

－

－

－

－

5,965

92,002(2,388)(1,513)0(2,292)85,8071,275

473,015

Dividends from surplus

－

－

－

－

－

－

－

(13,049)

Net income

－

－

－

－

－

－

－

31,180

－

－

－

－

－

－

－

(0)

13,064

64

－

0

459

13,58817

13,606

13,064

64

－

0

459

13,58817

31,736¥105,066¥ (2,323)¥ (1,513)¥0¥ (1,833)¥99,396¥1,292¥504,752

Balance at the beginningof the fiscal year
Cumulative effects ofchanges in accounting
policies
Restated balance at the
beginning of the fiscal
year
Changes during theperiodPurchase of treasurystock
Net changes of items
other than shareholders'equityTotal changes during theperiodBalance at the end of thecurrent period

10

Minority interests Total Net Assets

4． Segment Information(1) Outline of reporting segments
The Sony Financial Group consists of three reporting segments: the life insurance business, the non-life insurance
business and the banking business.
●The life insurance business consists of Sony Life Insurance Co., Ltd., AEGON Sony Life Insurance Co., Ltd.,and SA Reinsurance Ltd.
●The non-life insurance business consists of Sony Assurance Inc.
●The banking business consists of Sony Bank Inc., SmartLink Network, Inc. and SmartLink Network Hong
Kong Limited.
(2) Segment Information by reporting segment
For the six months ended September 30, 2013
Life insurance
business
Ordinary revenues
External customers
Intersegment
Total
Segment profit
Segment assets
OthersDepreciation
Interest income anddividends
Interest expenses
Equity in earnings(losses) of affiliates
Investments in affiliates
Increase in tangible fixed
assets and intangible
fixed assets

Millions of yen
Non-life
Banking
insurancebusinessbusiness

Total¥548,004
1,242
549,246
30,2086,241,918¥44,900
044,9002,872
134,474¥18,21698
18,315
3,594
1,976,689¥611,121
1,341
612,462
36,6758,353,083

3,522

1,001

1,098

5,622

58,96024

591－

13,105
4,313

72,658
4,337

(808)
9,234

－
－

－
－

(808)
9,234

¥1,096¥1,766¥912¥3,775(Note) These figures are presented following restatement in accordance with the changes in financial presentation for the first half ofthe fiscal year under review, described in “2. Additional Information” to the “I. Notes Regarding Summary Information.”

For the six months ended September 30, 2014
Life insurance
business
Ordinary revenues
External customers
Intersegment
Total
Segment profit
Segment assets
OthersDepreciation
Interest income anddividends
Interest expenses
Equity in earnings(losses) of affiliates
Investments in affiliates
Increase in tangible fixed
assets and intangible
fixed assets

Millions of yen
Non-life
Banking
insurancebusinessbusiness

Total¥578,091
1,385
579,476
40,158
6,953,121¥46,407046,407
3,436
149,486¥18,56789
18,6563,270
2,006,850¥643,065
1,475
644,541
46,865
9,109,458

3,602

1,248

1,086

5,936

65,888626

13,121

79,636

15

－

4,884

4,899

(354)
9,088

－
－

－
－

(354)
9,088

¥53,775¥1,433¥1,059¥56,26811

(3) Reconciliations of the totals of each segment item to corresponding enterprise amounts
Millions of yen
For the six months ended
For the six months ended
September 30, 2013
September 30, 2014
¥612,462¥644,541(1,341)(1,475)¥611,121¥643,065

Totals of reporting segments
Adjustments for intersegment transactions
Ordinary revenues in statement of income(Note) These figures are presented following restatement in accordance with the changes in financial presentation for the first half ofthe fiscal year under review, described in “2. Additional Information” to the “I. Notes Regarding Summary Information.”

Totals of reporting segments
Adjustments for intersegment transactions
Amount not allocated to reporting segments
Ordinary profit in statement of income

Millions of yen
For the six months ended
For the six months ended
September 30, 2013
September 30, 2014
¥36,675¥46,8653
3
130
98¥36,810¥46,967

Totals of reporting segments
Adjustments for intersegment transactions
Amount not allocated to reporting segments
Assets in balance sheets

Millions of yen
For the six months ended
For the six months ended
September 30, 2014
September 30, 2013
¥8,353,083¥9,109,458(21,077)(21,067)
29,364
31,836¥8,361,370¥9,120,226

Depreciation
Interest income and dividends
Interest expenses
Equity in earnings (losses) of affiliates
Investments in affiliates
Increase in tangible fixed assets andintangible fixed assets

Millions of yen
For the six months ended
For the six months ended
September 30, 2013
September 30, 2014
Consolidated
Consolidated
Total
Adjustments financial
Total
Adjustments financial
statements
statements¥5,622¥2¥5,625¥5,936¥9¥5,94572,658(239)
72,41979,636(239)
79,396
4,337
(67)
4,269
4,899
(67)
4,831
－
－
(808)
(808)
(354)
(354)
－
－
9,234
9,234
9,088
9,088
¥3,775¥211¥3,987¥56,268¥1¥56,270(Note) These figures are presented following restatement in accordance with the changes in financial presentation for the first half ofthe fiscal year under review, described in “2. Additional Information” to the “I. Notes Regarding Summary Information.”

5． Subsequent Events
There were no applicable subsequent events.

12

SFH’s consolidated results* are prepared in accordance with Japanese GAAP. As such, these figures differ insignificant respects from the financial information reported by Sony Corporation, the SFH’s parent company, which
prepares its financial statements in accordance with U.S. GAAP.
* SFH’s scope of consolidation includes Sony Financial Holdings Inc., Sony Life Insurance Co. Ltd., Sony Assurance Inc., Sony
Bank Inc., SmartLink Network, Inc. and SmartLink Network Hong Kong Limited.*1 It also includes AEGON Sony Life InsuranceCo., Ltd. and SA Reinsurance Ltd., as affiliated companies accounted for under the equity method.
*1
SmartLink Network Hong Kong Limited was not included in the scope of consolidation for the six months ended September 30,
2013.

Statements made in this press release with respect to Sony Financial Holdings’ current plans, estimates,
strategies and beliefs and other statements that are not historical facts are forward-looking statements about
the future performance of Sony Financial Holdings. Forward-looking statements include, but are not limited to,those statements using words such as “believe,” “expect,” “plans,” “strategy,” “prospects,” “forecast,”“estimate,” “project,” “anticipate,” “aim,” “intend,” “seek,” “may,” “might,” “could” or “should,” andwords of similar meaning in connection with a discussion of future operations, financial performance, events orconditions. From time to time, oral or written forward-looking statements may also be included in othermaterials released to the public. These statements are based on management’s assumptions, judgments andbeliefs in light of the information currently available to it. Sony Financial Holdings cautions investors that a
number of important risks and uncertainties could cause actual results to differ materially from those discussed
in the forward-looking statements, and therefore investors should not place undue reliance on them. Investors
also should not rely on any obligation of Sony Financial Holdings to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise. Sony Financial Holdings
disclaims any such obligation. The information contained in this statements does not constitute or form part ofany offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe for any
securities, nor shall it or any part of it from the basis of or be relied on in connection with any contract orcommitment whatsoever.

For inquiries:
Masaaki Konoo or Hiroko Hanakura
Corporate Communications & Investor Relations Dept.
Sony Financial Holdings Inc.
Telephone: +81-3-5785-1074
E-mail: press@sonyfh.co.jp
Website of Sony Financial Holdings Inc.
http://www.sonyfh.co.jp/index_en.html

13

III. Attachment
Content of Presentation Material

Consolidated Financial Results for the Six Months Ended September 30, 2014 andSony Life’s Market Consistent Embedded Value as of September 30, 2014
・Consolidated Operating Results for the Six Months Ended September 30, 2014・・・・・・・ 3
・Consolidated Financial Forecast for the Year Ending March 31, 2015・・・・・・・・・・ 28
・Sony Life’s MCEV and Risk Amount Based on Economic Value as of September 30,
2014・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 30
・Appendix・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 33

14

Presentation Material

Consolidated Financial Resultsf thforthe Six
Si Months
M th Ended
E d d September
S t b 30,
30 2014
andSon Life’sSonyMarket Consistent Embedded Valueas of September 30
30, 2014

Sony Financial Holdings Inc.
N
Novemberb 14
14, 2014
Sony Financial Holdings Inc. All Rights Reserved

Content
 Consolidated Operating Results for the Six Months Ended September 30, 2014

P. 3

 Consolidated Financial Forecast for the Year Ending March 31
31, 2015

PP. 28

 Sony Life’s MCEV and Risk Amount Based on Economic Valueas of September 30
30, 2014
 Appendix

P
P. 30
P. 33

Disclaimers:
This presentation material contains statements concerning the current plans, expectations, strategies and beliefs of the Sony Financial Group. Anystatements contained herein that pertain to future operating performance and that are not historic facts are forward-looking statements . Forwardlooking statements may include —but are not limited to—words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,” “forecast,” “predict,” and“possibility” that describe future operating activities, business performance, events or conditions. Forward-looking statements, whether spoken or
written,, are based on judgments
j gmade byy the managementgof the Sonyy Financial Group,p, based on information that is currently
y available to it. As
such, these forward-looking statements are subject to various risks and uncertainties, and actual business results may vary substantially from theforecasts expressed or implied in forward-looking statements. Consequently, investors are cautioned not to place undue reliance on forward-looking
statements. The Sony Financial Group disclaims any obligation to revise forward-looking statements in light of new information, future events or otherfindings. The information contained in this presentation does not constitute or form part of any offer for sale or subscription of or solicitation or
invitation of any offer to buy or subscribe for any securities, nor shall it or any part of it from the basis of or be relied on in connection with any
contract or commitment whatsoever.
*Unless otherwise indicated, in these materials figures less than the indicated unit have been truncated, while ratios and percentage changes have been rounded.
Also, a “–” is used where percentage changes exceed 1,000% and in cases where one or both comparisons are negative.
* “Lifeplanner” is a registered trademark of Sony Life.

Sony Financial Holdings Inc. All Rights Reserved2Consolidated Operating Results for
the Six Months Ended September 30,
30 2014

Sony Financial Holdings Inc. All Rights Reserved

3

Highlights of Consolidated Operating Performancefor the Six Months Ended September 30, 2014 (1)Consolidated ordinary revenues(Billions of yen)

Consolidated ordinary profit

611.1
611
1((*))

+5 2%
+5.2%

+27.6%

643.0

FY13.1H

FY14.1H

Ordinary revenues

549.2

579.4

+30.2

+5.5%

Ordinary profit

30.2

40.1

+9.9

+32.9%

Non-life
Insurancebusiness

Ordinary revenues

44.9

46.4

+1.5

+3.4%

Ordinary profit

2.8

3.4

+0.5

+19.6%

Bankingbusiness

Ordinary revenues

18.3

18.6

+0.3

+1.9%

Ordinary profit

3.5

3.2

(0.3)

(9.0%)

Intersegment
adjustments*
adjustments

(1.3)

(1.4)

(0.1)

－

O di
Ordinary
profitfit

Consolidated

Ordinary revenues

01
0.1

01
0.1

(0 0)
(0.0)

(23 8%)(23.8%)

Ordinary revenues

611.1

643.0

+31.9

+5.2%

Ordinary profit

36.8

46.9

+10.1

+27.6%Net income

20.8

31.1

+10.2
10.2

+49.3%
49.3%

FY14.1H(Billions of yen)(*) Banking business revised its method of recording ordinary
revenues and ordinary expenses on hedge transactions for
FY14.1H. Ordinary revenues for FY13.1H have been
retroactively adjusted to reflect the change. Consequently,
consolidated ordinary revenues for FY13.1H have beenrevised from ¥610.7 billion to ¥611.1billion. As adjustments toordinary revenues were accompanied by adjustments in thesame amountt to
t ordinarydiexpenses, ordinarydiprofitfit andd nettincome were unaffected.

ChangeLife
I
Insurancebusiness

46.9

36.8

FY13.1H(Billions of yen)

14.3.3114.9.30

Change from
14.3.31

Total assets

8 841 38,841.3

9,120.2+278 8+278.8

+3 2%
+3.2%

Net assets

4,67.0

504.7

+37.7

+8.1%

Consolidated*Ordinary profit in “Intersegment adjustments” is mainly from SFH.
*Comprehensive income: FY13.1H: ¥13.5 billion, FY14.1H: ¥44.7 billion

Sony Financial Holdings Inc. All Rights Reserved

4Highlights of Consolidated Operating Performancefor the Six Months Ended September 30, 2014 (2) Life Insurance Business: Policy amount in force increased steadily during the six months ended

September 30, 2014, reflecting a record-high new policy amount for the first half (April 1 to September 30).
Ordinary revenues increased compared with the same period of the previous fiscal year due to anincrease in income from insurance premiums reflecting a steady increase in policy amount in force andhigher interest income and dividends on general account assets. Ordinary profit increased year on year
due mainly to two reasons: the absence of the negative impact from the revision of the discount rate used
for calculating policy reserves on the interest rate-sensitive whole life insurance that was present in thesame period of the preceding fiscal year, and an increase in gains on sales of securities in the generalaccount in this first half.
 Non-life Insurance Business: Ordinary revenues expanded year on year owing to an increase in net

premiums written primarily for mainstay automobile insurance. Ordinary profit grew year on year due to a
decline in the loss ratio mainly led by a lower car accident ratio
ratio, as well as the rise in ordinary revenues
revenues.
 Banking Business: Ordinary revenues increased year on year due to higher gains from bond-dealingtransactions. In spite of the increase in ordinary revenues, ordinary profit decreased due mainly to two
reasons: lower volume on foreign exchange transactions stemming from passive foreign currency trading
by customers compared with the same period off the previous fiscalfyear when foreignfcurrency exchange
rates fluctuated wildly, and an increase in operating expenses.
 Consolidated ordinary revenues increased 5.2% compared with the same period of the previous fiscal

yyear,
to ¥643.0 billion, owing
g to increases in ordinary
y revenues from all the businesses: life insurance,
non-life insurance and banking. Consolidated ordinary profit increased 27.6% year on year, to ¥46.9
billion. By business segment, ordinary profit from the life insurance and the non-life insurance businesses
increased, whereas ordinary profit from the banking business decreased. Consolidated net income was up
49.3% yyear on yyear, to ¥31.1 billion, reflecting
g the rise in ordinaryyp
profit, and the change
g of the calculation
policy of the reserve for price fluctuations for Sony Life.
Sony Financial Holdings Inc. All Rights Reserved

5Highlights of Operating Performance:
Sony Life (Non-consolidated)
Ordinary revenues

Ordinary profit

40.4

FY13.1H

FY14.1H

549.5

579.3

+29.8

Income from insurance premiums

437.9

454.0

+16.0

+3.7%

I
Investmenttt income
i

107 6
107.6

120 8
120.8

+13.1
13 1

+12.2%
12 2%(Billions of yen)

Ordinary revenues

+5.4%

31 3
31.3

FY13.1H

579.3

549.5

+29.2%

FY14.1H (Billions of yen)

◆ Ordinary revenues and ordinary profit increased year on year.
premiums increased due to a steadyy◆ Income from insurance p
growth in policy amount in force.
◆ Investment income increased due mainly to higher interest
income and dividends on general account assets.
◆ Ordinary profit increased year on year due mainly to two
reasons: the absence of the negative impact from the revisionof the discount rate used for calculating policy reserves on theinterest rate-sensitive whole life insurance that was present in
the same period of the preceding fiscal year, and an increase ingains on sales of securities in the general account in this first
half.
◆ Net income was up year on year reflecting the rise in ordinary
profit, and the change of the calculation policy of the reserve forprice flfluctuations.
ct ations The change wasas to accumulate
acc m late the reserve
reser eup to required levels from FY14 while it had accumulated thereserve in excess of the required levels until FY13.

Change+5.4%

Interest income and dividends

58.9

65.8

+6.9

+11.7%

Income from monetary trusts, net

2.6

2.6

(0.0)

(1.1%)

Gains on sale of securities

0.0

3.8

+3.8

－

Gains on separate accounts, net

45.8

46.4

+0.6

+1.4%

518.2

538.9

+20.7

+4.0%

Insurance claims and other payments

155.0

173.0

+17.9

+11.6%

Provision for policy reserves and others

Ordinary expenses

294.0

293.6

(0.3)

(0.1%)

Investment expenses

4.0

4.5

+0.4

+11.8%

Operating expenses

55.8

56.8

+0.9

+1.7%

Ordinary profit

31.3

40.4

+9.1

+29.2%Net income

17 6
17.6

26 9
26.9

+9 2
+9.2

+52 3%+52.3%

14.3.3114.9.30

Change from 14.3.31

Securities

5,954.7

6,235.6+280.9+4.7%

Policyy reserves

6,123.6,

6,413.4,+289.7

+4.7%

369.2

402.4

+33.2

+9.0%

83.4

97.0

+13.5

+16.3%

6,624.9

6,959.1+334.2

+5.0%

640 5
640.5

702 0
702.0

+61 4
+61.4

+9 6%
+9.6%

(Billions of yen)

Net assets
Net unrealized gains on other securities
Total assets
Separate account assets

Sony Financial Holdings Inc. All Rights Reserved

6Overview of Operating Performance:
Sony Life (Non-consolidated)(Billions of yen)

New policy amount

FY13.1H

FY14.1H

Change<Reasons for changes>

1,874.8

2,127.3+13.5%◆ Increased due to higher sales of U.S.
dollar denominated insurance,
variable life insurance and term-life
insurance.

Lapse and surrender amount

876.4

862.5

(1.6%)

Lapse and surrender rate

2.32%

2.21%

(0.11pt)

Policy amount in force

38,357.1

39,952.7

+4.2%

30.1

36.2

+20.0%

Annualized premiums from new policies

69
6.9

65
6.5

(5 1%)(5.1%)

681.4

715.4

+5.0%

165.0

169.7

+2.9%

Of which,hi h thi
third-sectordt products
d tAnnualized premiums from insurance in force
Of which, third-sector products

FY13.1H

FY14.1H

ChangeGains from investment, net (General account)

57.7

69.8

+20.9%

Core profit

33.5

38.5

+14.9%

Positive spread

33
3.3

55
5.5

+66 7%+66.7%(Billions of yen)

Non-consolidated solvency margin ratio

14.3.3114.9.30

Change from
14.3.312,358.7%

2,510.4%+151.7pt◆ Decreased in each product.

◆ Increased reflecting an increase in
new policy amount and higher salesof endowment insurance andeducational endowment insurance.

◆ Increased year on year, due mainly totheh absenceb
off theh negative
i iimpactfrom the revision of the discount rateused for calculating policy reserves
on interest rate-sensitive whole life
insurance that was present in thesame periodi d off th
the precedingdi fi
fiscallyear.

Notes:
1. Figures for new policy amount, lapse and surrender amount, lapse and surrender rate, policy amount in force,
annualized premiums from new policies and annualized premiums from insurance in force are calculated as
the total of individual life insurance and individual annuities.
2. The lapse and surrender rate shows the ratio derived by dividing the amount of lapses and surrenders, notadjusted for policy amount decreases, increases, and reinstatements, by the policy amount in force at the
beginning of the fiscal year

Sony Financial Holdings Inc. All Rights Reserved

7

Operating Performance :Sony Life (Non-consolidated) (1)
Number and Amount of New Policies(Individual Life Insurance + Individual Annuities)

Annualized Premiums from New Policies

New policy amount

Annualized premiums from new policies(Individual Life Insurance + Individual Annuities)

Number of new policies

Of which,which third-sector(Thousands ofpolicies)(Billions of yen)(Trillions of yen)274

+15 9%+15.9%

286

300

246

30,0003.0

40
35

25,0002.01
20,0002.0+13.5%

1.87

2 12
2.12

200

36.2
32.1

30.1

30

+20.0%

25
20

15 00015,000100

1.0
10,000

15
10

5,000

5

0
FY12.1H

FY13.1H

FY14.1H

0

8.1

6.9

FY12.1H

FY13.1H(5.1%)

6.5

0Sony Financial Holdings Inc. All Rights Reserved

FY14.1H

8

Operating Performance :Sony Life (Non-consolidated) (2)
Number and Amount of Policies in Force

Annualized Premiums from Insurance in Force(Individual Life Insurance + Individual Annuities)
Policyy amount in force(Trillions of yen)

50

6.16

+5.4%

(Individual Life Insurance + Individual Annuities)
Annualized premiums from insurance in force

Number of p
policies in force

6.33

6.49

Of which, third-sector(Millions of policies)(Billions of yen)
681.4
700

+2.6%

+5.0%

715.4

696.9
+2 6%
+2.6%

6
40

38.3

+4.2%

600

39.9

39.0

5

+2.2%

500
4

30

400
3

20
2

300

200

+2.9%

10

0

13.9.30

14.3.31

1

100

0

0

14.9.30

165.0

167.0

13.9.30

14.3.31Sony Financial Holdings Inc. All Rights Reserved

+1.6%
1 6%

169.7

14.9.30

9Operating Performance :Sony Life (Non-consolidated) (3)Lapse and Surrender Rate*(Individual Life Insurance + Individual Annuities)(%)

10

Lapse and surrender rate
(Annual)

Lapse and surrender rate
(1H)

8

6

5.31
4.61

4
(0 11pt)(0.11pt)

2

2.65

2.32

FY12

FY13

2.21

0
FY14

*The lapse and surrender rate shows the ratio derived by dividing the amount oflapses and surrenders, not adjusted for policy amount decreases, increases, andreinstatements, by the policy amount in force at the beginning of the fiscal year.

Sony Financial Holdings Inc. All Rights Reserved

10Operating Performance :Sony Life (Non-consolidated) (4)Income from Insurance Premiums

Interest Income and Dividends(Billions of yen)(Billions of yen)

500

428.8

454.0

437.9

65.8

70
+11 7%+11.7%
+3.7%

400

58.9

60

52.1
50
300

40
200

30
20

100

10
0
FY12.1H

FY13.1H

0

FY14.1H

FY12.1H

FY13.1H

FY14.1H

Sony Financial Holdings Inc. All Rights Reserved

11

Operating Performance :Sony Life (Non-consolidated) (5)Core Profit

Ordinary Profit(Billions of yen)(Billions of yen)

38.5

40

33.3

40.4
40

33.5
+14.9%
14 9%

30

31.3

31.3

FY12.1H

FY13.1H

30

20+29.2%

20

10

10

0

0
FY12.1H

FY13.1H

FY14.1H(Reference) Impact on core profit
Positive (Negative) spread (*1)
Provision of policy reserves for minimum
guarantees for variable life insurance (*2)
Effects by the revision of policy reserve
discount rate (Interest rate-sensitive
rate sensitive whole life
insurance ) (*3)(Billions of yen)

FY12.1H FY13.1H
(0.4)
3.3

FY14.1H
5.5

(4.0)

(1.2)

(2.5)

-

(5 7)
(5.7)

-

FY14.1H(Reference) Main differences from Core Profit(Billions of yen)

FY12.1H

FY13.1H

Capital gains (loss)

0.1

(0.0)

FY14.1H
4.4

Provision of contingency reserve (*2)

(1.9)

(2.1)

(2.4)

*1: The minus amount in positive spread indicates negative spread.
*2: “Provision of p
policyy reserves for minimum gguarantees for variable life insurance” and“Provision of contingency reserve” are described as negative amount.
*3: The effect of the revision of policy reserve discount rate on interest rate-sensitive whole life
insurance in May 2013.

Sony Financial Holdings Inc. All Rights Reserved

12

Operating Performance :Sony Life (Non-consolidated) (6)
Number of Lifeplanner Sales Employees+123(Number)

4,500

4,133
4
133
[105]

4,127
4
127
[109]

4,125
4
125
[110]

13.3.3113.6.30

13.9.30

4,092
[121]

4,248
[150]

4,228
[146]

4,216
[138]

+20

4,000

3 500
3,500

3,000
0

13.12.31

14.3.3114.6.30

14.9.30

Note: Figures in [ ] show the numbers of Lifeplanner sales employees (rehired on a fixed-term contract basis after retirement) included in the overall
numbers, those who have reached retirement age but who continue to work as Lifeplanner sales employees that meet certain sales conditions
and other requirement.

Sony Financial Holdings Inc. All Rights Reserved

13

Operating Performance :Sony Life (Non-consolidated) (7)Breakdown of General Account Assets
14.3.31<Asset management review>

14.9.30(Billions of yen)Amount%Japanese governmentand corporate bonds

5,190.0,

86.7%

5,390.7,

86.2%

Japanese stocks

33.2

0.6%

36.1

0.6%

Foreign bonds

79.8

1.3%

93.5

1.5%

Amount%We have continued to accumulate ultralongterm bonds to match the liability
characteristics of insurance policies withlong term matlong-term
maturities
rities with
ith the aim of red
reducing
cing
interest rate risk.
<Bond duration>
Mar. 31, 2013: 19.9 years

Foreign stocks

26.9

0.4%

26.6

0.4%

Monetary trusts

305.3

5.1%

308.8

4.9%

Policy loans

154.1

2.6%

158.5

2.5%

Real estate

66.5

1.1%

118.5

1.9%

Cash and call loans

32.6

0.5%

35.9

0.6%

Others

95.6

1.6%

88.1

1.4%

5 984 3
5,984.3

100 0%
100.0%

6 257 06,257.0

100 0%
100.0%

Total

Mar. 31, 2014: 19.7 years
Sep. 30, 2014: 19.8 years■ Investment in the monetary trusts is mainly into
Japanese government and corporate bonds.
■ The holding ratio on the real status of Japanese
government and corporate bonds including
those invested in monetary trusts in the generalaccount assets: As of Sep. 30, 2014: 91.1%(As of Mar. 31, 2014: 91.8%)

Sony Financial Holdings Inc. All Rights Reserved

14

Operating Performance :Sony Life (Non-consolidated) (8)Non-consolidated Solvency Margin Ratio

(%)

3,000

2,510.4
2,500

2,358.7

2,281.8+151.7pt

2,000

1,500

1,000
0
13.3.3114.3.3114.9.30

Sony Financial Holdings Inc. All Rights Reserved

15

Operating Performance :AEGON Sony Life Insurance*AEGON Sony Life Insurance sells individual variable annuities.

Number and Amount of Policies in Force

Number and Amount of New Policies
New policy amount(Billions of yen)

Number of new polices [ ]83.3[14.3]

90
80

16
63.8
[10.8]

70(Thousands ofpolicies)

Policy amount in force(Billions of yen)

350

14

200

40

20

50

250

8

40

10
0
FY12.1H

FY13.1H

155.8[24.1]

30

150

6
18.3
[2.5]

60

236.4
236
4
[38.2]

10

50

30

298.2
[48.5]

300

12

60

Number of policies in force [ ] (Thousands ofpolicies)

4

100

2

50

0

0

FY14.1H

20
10
0
13.9.30

14.3.3114.9.30

Net income (losses) for AEGON Sony Life Insurance and SA Reinsurance
FY13 1H
FY13.1H

Ch
ChangeFY14 1H
FY14.1H

AEGON Sony Life Insurance

(1.7)

(2.4)

(0.7)

SA Reinsurance

0.1

1.7

＋1.6

AEGON Sony Life Insurance and SA Reinsurance are equity method companies
companies, 50-50 joint venture established by Sony Life and AEGON Group.
Group
SA Reinsurance prepares its financial statements in accordance with U.S. GAAP. 50% of the net income (losses) for AEGON Sony Life Insurance andSA Reinsurance are recognized as investment profit (losses) on equity method in the SFH’s consolidated net income.

Sony Financial Holdings Inc. All Rights Reserved

16

Highlights of Operating Performance:
Sony Assurance
Ordinary revenues

44.9

Ordinary profit+3.4%

FY13.1H

FY14.1H

44.9

46.4

+1.5

+3.4%

Underwriting income

44.2

45.7

+1.4

+3.3%

Investment income

0.5

0.6

+0.0

+5.1%

42.0

42.9

+0.9

+2.2%

Underwriting expenses

31.7

32.0

+0.2

+0.7%

Investment expenses

0.0

0.0

(0.0)

(99.7%)

Operating general andadministrative expenses

10.2

10.9

+0.7

+7.0%

Ordinary profit

2.8

3.4

+0.5

+19.6%Net income

18
1.8

23
2.3

+0 5
+0.5

+29 4%+29.4%

14.3.3114.9.30(Billions of yen)

Ordinary revenues

46.4

y expensespOrdinary

3.4+19.6%

2.8

FY13.1H

FY14.1H(Billions of yen)

◆ Ordinary revenues and ordinary profit increased
year on year.
◆ Ordinary revenues increased year on year, due
to an increase in net premiums written primarily
for its mainstay automobile insurance.
◆ Ordinary profit grew year on year due to a
decline in the loss ratio mainly led by a lower
car accident ratio, as well as the rise in ordinary
revenues.

(Billions of yen)

ChangeChange from
14.3.31

Underwriting reserves

78 0
78.0

82 4
82.4

+4.4
4.4

+5.6%
5.6%

Net assets

21.4

24.1

+2.7

+12.8%

Total assets

142.7

149.4

+6.7

+4.7%

Sony Financial Holdings Inc. All Rights Reserved

17

Overview of Operating Performance:
Sony Assurance(Billions of yen)

FY13.1H

ChangeFY14.1H<Reasons for changes>

Direct premiums written

43.6

45.0

+3.3%

Net premiums written

44.2

45.7

+3.3%

Net losses paid

23.2

22.4

(3.8%)

Underwriting profit

2.3

2.8

+22.8%Net loss ratio

59.6%

56.4%

(3.2pt)Net expense ratio

24.6%

25.4%

+0.8ptCombined ratio

84.2%

81.8%

(2.4pt)◆ Increased mainly in its mainstay
automobile insurance.
◆ Declined due mainly to a lower car
accident ratio.

◆ IncreasedIdd
due mainly
i l tto hihigherhsystem-related expenses, a rise ininsurance acquisition cost and a
consumption tax rate rise.

Notes:Net loss ratio = (Net losses paid + Loss adjustment expenses ) / Net premiums written.
Net expense ratio = Expenses related to underwriting / Net premiums written

Number of policies in force
Non-consolidated
Nonconsolidated
solvency margin ratio

14.3.3114.9.30

Change from 14.3.31

1.61 million

1.65 million+0.04 million

527.6％

596.3%+2.7%+68.7pt

Note: The number of policies in force is the total of automobile insurance and medical and cancer insurance,
which accounts for 99% of net premiums written.

Sony Financial Holdings Inc. All Rights Reserved18Sony Assurance’s Underwriting Performanceby Type of Policy
Direct Premiums Written

Net Premiums Written

FY13.1H

FY14.1H

Fire

115

119

+3.3%

Marine－－－Personal accident

4,124

4,277

+3.7%

Voluntary automobile

39,391

40,671+3.2%(Millions of yen)Compulsory
automobile liability
Total

FY13.1H

FY14.1H

Change

Fire

82

16

(80.0%)

Marine6884+22.8%

Personal accident

4,254

4,411

+3.7%

Voluntary automobile

39,26440,568+3.3%

Compulsory
automobile liability

608

671

+10.2%

44,27945,752+3.3%
3.3%

Change－－－43 632
43,63245,069

+3 3%
+3.3%

(Millions of yen)

Total

*SURE, medical and cancer insurance is included in personal accident.

Net losses paid
FY13.1H

FY14.1H

Fire

0

2

+340.6%

Marine7773(5.0%)

Personal accident

1 010
1,010

1 128
1,128

+11.7%
11 %Voluntary automobile

21,667

20,616(4.9%)

Compulsory
automobile liability

544

601

+10.4%

Total

23,29922,420(3.8%)(Millions of yen)

ChangeSony Financial Holdings Inc. All Rights Reserved

19

Operating Performance:
Sony Assurance (1)Ordinary Profit andAdjusted Ordinary Profit

Net Premiums Written andNumber of Policies in Force
Voluntary automobile insurance
Personal accident insurance
OthersNumber of policies in force(Billions of yen)O diOrdinary
profitfit

48
4.8

Adj t d ordinary
Adjusteddiprofit
fit

4.5
+5.3%

(Billions of yen)

1 53
1.53

1 57
1.57

1.65

(Millions ofpolicies))p34
3 3 +19.6% 3.4
3.3

3.5

2.8

1.6

50

41.8

44.2

+3.3%

45.7
0.7 1.4

4.4

40

2.5

1.2
1

30

40.5

1.5

0.8
0.5

20

0.4
10
0.2
0

0
FY12.1H

FY13.1H

FY14.1H

The numberTh
b off policies
li i iin fforce iis th
the ttotalt l off automobilet
bil iinsurance andd medical
di land cancer insurance policies, which account for 99% of net premiums written.
More than 90% of personal accident insurance is medical and cancer insurance.

04
0.4
(0.1)

0.6
-0.5

FY12 1H
FY12.1H

FY13 1H
FY13.1H

FY14 1H
FY14.1H*Adjusted ordinary profit = Ordinary profit + Provision for catastrophe reserve(Reference) Provision for catastrophe reserve
FY12.1H
p reserve((0.6))
Provision for catastrophe(Billions of yen)

FY13.1H
0.4

FY14.1H
1.4*Provision for catastrophe reserve is described as positive amountSony Financial Holdings Inc. All Rights Reserved

20

Operating Performance:
Sony Assurance (2)Earned/Incurred Loss Ratio +Net Expense Ratio
E
Earned/Incurredd/Id loss
l
ratio
ti
(%)
100

98.9

93.8

(Net Loss Ratio+ Net Expense Ratio)
N t loss
Net
l
ratio
ti

N t expense ratio
Net
ti

90.5

89.2

87.8
(2.7pt)(3.5pt)

84.2

81.8

62.0
63.2

62.4

59.6

59.3

(3.2pt)

56.4

40

40

20

87 7
87.7

(2.4pt)

60

65.9
68.2

84 9
84.9

80

73 3
73.3
72.9

N t expense ratio
Net
ti

(%)
100

99.0

80

60

＜参考＞ (Reference) Combined Ratio

26.0

25.6

20

+0.8pt

25.7

24.6

25.4

FY13.1H

FY14.1H

26.0

25.6

+0.8pt

25.7

24.6

25.4

FY12.1H

FY13.1H

FY14.1H

0

0
FY12

FY13

FY12.1H

FY12

Notes:
Earned/Inc rred loss ratio = (Net losses paid + Provision
Earned/Incurred
Pro ision for reserve
reser e for outstandingo tstanding
losses + Loss adjustment expenses) / Earned premiums[Earthquake insurance and compulsory automobile liability insurance are excluded
from the above calculation.]

FY13

Notes:Net loss ratio = (Net losses paid + Loss adjustment expenses ) / Net premiums written
Net expense ratio = Expenses related to underwriting / Net premiums writtenSony Financial Holdings Inc. All Rights Reserved

21

Operating Performance:
Sony Assurance (3)Non-consolidated Solvency Margin Ratio

(%)

800

504 2%
504.2%

527 6%
527.6%

596.3%+68.7pt

400

013.3.3114.3.3114.9.30

Sony Financial Holdings Inc. All Rights Reserved

22Highlights of Operating Performance:
Sony Bank (Consolidated/Non-consolidated)
Consolidated ordinary revenues
Consolidated ordinary profit<Consolidated>
FY13.1H

FY14.1H

Consolidated ordinary revenues

18.3

18.6

+0.3

+1.9%

Consolidated ordinary profit

3.5

3.2

(0.3)

(9.1%)

Consolidated net income

2.2

2.0

(0.1)

(8.8%)(Billions of yen)

18.6

18.3
+1.9%

3.5

(9.1%)

FY13.1H

Change<Non-consolidated>

3.2

FY13.1H

FY14.1H

Ordinary revenues

17.0

17.3

+0.2

+1.4%

Gross operating profit

11.0

10.6

(0.3)

(3.2%)(6.2%)(Billions of yen)

8.8

8.2

(0.5)

N t feesNetfandd commissions
i i

(0 1)
(0.1)

(0 3)
(0.3)

(0 1)
(0.1)

―

Net other operating income

2.3

2.6

+0.3

+13.7%

General and administrative expenses

7.2

7.5

+0.2

+3.6%

Net operatingpg profit
p

3.7

3.1

(0.6)

(17.4%)

Ordinary profit

3.6

3.2

(0.4)

(11.9%)Net income

2.3

2.0

(0.2)

(10.3%)Net interest income

FY14.1H(Billi(Billions
off yen))<Consolidated>◆ Ordinary revenues increased year on year, due to higher gains
from bond-dealing transactions. In spite of the increase in ordinary
revenues, ordinary profit decreased due mainly to two reasons: lower
g exchange
g transactions stemmingg from p
passivevolume on foreignforeign currency trading by customers compared with the same
period of the previous fiscal year when foreign currency exchange
rates fluctuated wildly, and an increase in operating expenses.
<Non-consolidated>◆Both gross operating profit and net operating profit decreased
year on year, due to lower gains on foreign exchangetransactions as the same reason as in the consolidated results.
・Net interest income decreased year on year. Behind this drop was
lower interest income on securities under the lowering interest
rates.
・Net fees and commissions decreased year on year due to lower
fees on investment trusts and higher fees paid for ATM usage.
・Net
N t otherth operatingti incomeiincreasedid year on year ddue
to higher net gains on bond-dealing transactions, despite lower
gains on foreign exchange transactions.

Change(Billions of yen)

Net assets
Net unrealized gains onother securities, net of taxes
Total assets

14.3.3114.9.30

Change from 14.3.31

72.7

74.0

+1.2

+1.7%

7.2

6.3

(0.8)

(12.2%)

2 056 72,056.7

1 996 2
1,996.2(60 4)(60.4)(2 9%)(2.9%)(*) Sony Bank revised its method of recording ordinary revenues and ordinary expenses on hedge transactions
for FY14.1H. Ordinary revenues for FY13.1H have been retroactively adjusted to reflect the change.

Sony Financial Holdings Inc. All Rights Reserved

23

Overview of Operating Performance:
Sony Bank (Non-consolidated) (1)<Reasons for changes>
Change from
14.3.3113.9.30

14.3.31

Customer assets

1,930.7

2,007.5

1,945.2(62.2)(3.1%)

Deposits

1,813.0

1,890.0

1,824.6(65.3)(3.5%)

Yen

1 435 1
1,435.1

1 526 4
1,526.4

1,483.8(42 6)(42.6)(2 8%)(2.8%)

377.9

363.5

340.8

(22.7)(6.2%)

Investment trusts

117.6

117.4

120.5

+3.0

+2.6%

L
Loans
outstandingt t di

1 009 5
1,009.5

1 057 4
1,057.4

1 092 1
1,092.1

+34 6
+34.6

+3 3%
+3.3%

Mortgage loans

899.6

949.3

983.2

+33.9

+3.6%

Others

109.9

108.1

108.8

+0.7

+0.7%

94

97

101

+3

(Based on Financial
Reconstruction Law)

0.39％

0.35%

0.32％

(0.03pt)

Capital adequacy ratio

11.99%

11.72%

11.80%+0.08pt(Billions of yen)

Foreign currency

Number of accounts(10 thousands)

Non-performing assets ratio(domestic criteria)

14.9.30*1◆ Yen deposit balance decreased
from 14.3.31
14 3 31 undernder persistentl
persistently lo
lowinterest rates.

◆ Foreign currency deposit balance
decreased due to an increase in
selling to lock in profits led by yen
depreciation.
◆ Loan balance steadily increased
mainly in mortgage loans.

◆ Number of accounts increased
reflecting
fl ti a new operation
ti byb SonyS
Life’s Lifeplanner sales employees
to handle opening account at Sony
Bank from May 2014.

◆ Sony Bank maintains extremely
low non-performing assets ratio.

*1 Loans in others include corporate loans of ¥103.2 billion*2
2 Balance of problem assets based on the Financial Reconstruction Law / Total credit exposure*3 Please refer to the graph of the non-consolidated capital adequacy ratio (domestic criteria) on P27

Sony Financial Holdings Inc. All Rights Reserved

24Overview of Operating Performance:
Sony Bank (Non-consolidated) (2)<Reference> On Managerial Accounting Basis<Reference> Interest Spread(Managerial Accounting Basis)

FY13.1H

FY14.1H

10 9
10.9

10 6
10.6

(0 3)
(0.3)

(3 3%)(3.3%)

9.1

9.0

(0.0)

(0.9%)

0.4

0.0

(0.4)

(97.5%)g income*3
Net other operating

1.3

1.5

+0.2

+15.5%

Gross operating profit (core profit)(A)＝①＋②

9.6

9.0

(0.5)

(5.9%)

Operating expenses and otherexpenses
③

7.2

7.4

+0.1

+2.5%

Net operating profit (core profit)＝(A)－③

2.4

1.6

(0.7)

(31.1%)(Billions of yen)
Gross operating profit
Net interest income*1①

Net fees and commissions*2②

ChangeYield on financing

Yield on investment
Interest spread
(%)

1.5
1.20
0.93

1

■Managerial accounting basis

1.20(0.02pt)

0.91
0.91

0.5

g adjustmentsjare made to the figuresgon a financial account for p
profits and
The following

0.27

0 28
0.28

FY13 1H
FY13.1H

FY14 1H
FY14.1H

losses more appropriately.
*1: Net interest income: Includes profits and losses associated with fund investment recorded in
net other operating income, including gains or losses from currency swap transactions.
*2: Net fees and commissions: Includes profits and losses for customer dealings in foreign
currency transactions recorded in net other operating income.

0*3: Net other operating income: After the above adjustments (*1 and *2), consists of profits andlosses for bond and derivative dealing transactions.

Note: Interest spread=(Yield on investment)-(Yield on financing)■Core profit
Profits and losses exclude net other operating income, which includes those on bond andderivative dealing transactions, and stands for Sony Bank’s basic profits.

Sony Financial Holdings Inc. All Rights Reserved

25

Operating Performance:
Sony Bank (Non-consolidated) (1)Loans

Deposits
Yen depositspForeigng currency
y depositspMortgageg g loans

Others(Billions of yen)
1,200(Billions of yen)

2,000

1,092.1

1,057.4
1,857.4

1,890.0

1,824.6(65.3)

340.8

1,000

970.2

+34.6

108.8

*corporate loansof ¥103.2 billion

800

1,500

983.2

600
1,000

400

500

1,483.8200

0013.3.3114.3.3114.9.30

13.3.31Sony Financial Holdings Inc. All Rights Reserved

14.3.3114.9.30

26

Operating Performance:
Sony Bank (Non-consolidated) (2)Non-Consolidated Capital Adequacy Ratio

Balance of Securities by Credit Rating
AAA
BBB

AA
A
Others(Domestic Criteria)(%)
15(Billions of yen)
1,200

11 98
11.98
1,000

908.8
773.8

800

764.7

+0 08pt+0.08pt

11.72

11.80

10

(9.0)
600
5
400

200
0
13.3.31013.3.3114.3.3114.9.30

14.3.3114.9.30*Calculated based on the standard FSA Notification No. 19 (2006), which establishes
standards based on Article 14-2 of the Banking Act of Japan for determining thecapital adequacy of a bank in light of the assets held by the bank.
Sony bank calculates this ratio based on Basel III from March 31, 2014

Sony Financial Holdings Inc. All Rights Reserved27

28

Consolidated Financial Forecast
for the Year Ending
g March 31,, 2015

Sony Financial Holdings Inc. All Rights Reserved

29

Consolidated Financial Forecast
for the Year Ending March 31, 2015
SFH’s consolidated financial forecast for FY2014 is unchanged from the forecast announced
on May 14, 2014, while the forecast of the non-life insurance is revised upward.
((Billions of yyen))
Consolidated ordinary revenues

FY2013(Actual)

FY2014(Forecast)

1,320.4*1

1,191.0

Change(9.8%)

FY14.1H((Actual))

Progress rate

643.0

54.0%

1,196.6

1,061.9(11.3%)

579.4

54.6%

89.8

92.4⇒93.0+2.8%⇒+3.5%

46.4

50.2%⇒49.9%

36 4*1
36.4

36 6
36.6

+0 3%
+0.3%

18 6
18.6

51.0%

Consolidated ordinary profit

76.1

77.0

+1.1%

46.9

61.0%

Life insurance business

67.2

67.4

+0.2%

40.1

59.6%

Life insurance business
Non-life insurance businessBanking business

Non-life insurance business3.0

3.9⇒4.5+29.8%⇒+49.8%

3.4

88.1%⇒76.4%

Banking business

5.6

5.3

(6.0%)

3.2

61.7%

40.5

49.0

+21.0%

31.1

63.6%

Consolidated net income■ Life Insurance Business
Taking into consideration the market fluctuation risk on and after October 1, 2014, the forecast for ordinary revenues and ordinary profit remains
unchanged even though the results for this first half exceeded our expectations.
■ Non-life Insurance BusinessWe have revised upward our forecast for ordinary revenues because we expect net premiums written in mainstay automobile insurance to continueiincreasing
i steadilyt dil iin th
the second
dh
half.
lf W
We h
have revisedi d upward
d our fforecastt ffor ordinarydiprofitfit bbecause we expectt th
the lloss ratio
ti tot remaini slowlandd stablet bl
in the second half despite a rise in the expense ratio.
■ Banking Business
Taking into consideration the current business performance and the market environment, our forecast for ordinary revenues and ordinary profit remains
unchanged
g even thoughg ordinary
y revenues increased because the rise in bond-dealingg transactions for this first half exceeded our expectations.
p(*) Since the banking business revised its method of recording ordinary revenues and ordinary expenses on hedge transactions for FY14.1H, ordinary revenues for FY13 have been retroactively
adjusted to reflect the change. Consequently, consolidated ordinary revenues and ordinary revenues of the banking business for FY13 have been revised.

Sony Financial Holdings Inc. All Rights Reserved30Sony Life’s MCEV and
Risk Amount Based on Economic Valueas of September 30, 2014

Please keep
p in mind that the validity
y of these calculations of MCEVC
as of SSep.
p 30, 2014,
0 , has not been verified byy outside specialists.
p
A part of the calculations of MCEV as of Sep. 30, 2014, adopted simplified method.

Sony Financial Holdings Inc. All Rights Reserved

31Sony Life’s MCEV as of September 30, 2014
(Billions of yen)

14.3.3114.6.30

14.9.30

Change from
14.3.31

Change from
14.6.30

1,221.3

1,260.0

1,313.1

+91.8

+53.1

Adjusted net worth

722.1

758.4

833.4

+111.3+75.1

Value of existing business

499.1

501.7

479.7

(19.5)(22.0)

MCEV(Billions of yen)

New business value

New business margin14.3.3114.6.30

14.9.3055.2 (12M)

16.9 (3M)

30.3 (6M)

5.2%

5.5%

5.1%

Notes:
1. New business margin equals new business value divided by present value of premium income.
2. Calculated MCEV as of Jun. 30, 2014 and Sep. 30, 2014 by using updated economic assumptions and lapse and surrender rate and other assumptions as of Mar. 31, 2014.

 Reasons for changes in MCEV
・MCEV as of Sep.
p 30, 2014 increased ¥53.1 billion from Jun. 30, 2014, due mainly
y to an acquisitionqof new p
policies, a lower inflation rate
and a rise in stock price.
・MCEV as of Sep. 30, 2014 increased ¥91.8 billion from Mar. 31, 2014, due mainly to an acquisition of new policies, yield curve changes
in Japanese yen and a rise in stock price.
 New business value
・New business value as of Sep.
Sep 30,30 2014 was ¥30.3¥30 3 billion (¥60(¥60.6
6 billion / annualized)
annualized), reflecting brisk sales of new policies even in lower
interest rates in Japanese yen.
 New business margin
・New business margin as of Sep. 30, 2014 was down 0.4% from Jun. 30, 2014 due mainly to lower interest rates in Japanese yen.
g as of Sep.
p 30, 2014 remained almost at the same level as on Mar. 31, 2014, mainly
y because the negativeg
impactp・New business marginof lower interest rates in Japanese yen was offset by the positive impact stemming from the absence of the FY13 negative effects; asubstantial increase in sale of lump-sum payment endowment insurance and the strong sale led by the revision of insurance premium
rates on interest rate-sensitive whole life insurance.

Sony Financial Holdings Inc. All Rights Reserved*Please see page 42 for trend on JGB yields.

32

Sony Life’s Risk Amount Based on Economic Valueas of September 30, 2014
14.3.31(Billions of yen)

14.6.30

14.9.30

Insurance risk

654.5

663.9

673.3

Market-related risk

240.0

265.0

279.0

Of which, interest rate risk*

180.9

202.8

206.6

Operational risk

26 3
26.3

26 1
26.1

26 4
26.4

Counter party risk

1.3

1.7

1.4

Variance effect(257.8)(269.3)(276.4)

The risk amount based on economic value

664.3

687.3

703.7

(*) Interest amount excluding the variance effect within market-related risk.

(Billi(Billions
off yen))

MCEV

14 3 3114.3.311,221.3

14 6 30
14.6.30
1,260.0

14 9 30
14.9.30
1,313.1

 Maintained capital adequacy by controlling market-related risk.
Notes:
1. The risk amount based on economic value refers to the total amount of Sony Life’s risks, comprehensively examined and including insurance risk andmarket-related risk.
2. The solvency risk capital on an economic value basis is calibrated at VaR (99.5) over one year and based on the internal model, which is a similar but
modified model based on the EU Solvency II (QIS5) standard method.
3. Calculated MCEV as of June 30, 2014 and September 30, 2014 by using updated economic assumptions and lapse and surrender rate and otherp
as of March 31,, 2014.
assumptions

Sony Financial Holdings Inc. All Rights Reserved

33

AppendixSony Financial Holdings Inc. All Rights Reserved34

Recent Topics 1
AEGON Sony Life Insurance
Launch of sales: December 1, 2009
Common stock: ¥26 billion (including capital surplus of ¥13 billion)*
Equityy ownership: Sonyy Life insurance Co Ltd 50%, AEGON international B.V. 50%
Marketing products: Individual Variable Annuities
Sales Channels: Lifeplanner sales employees and partner Banks (20*)

SA Reinsurance Ltd
Established： October 29
29, 2009
Common stock: ¥11 billion*
Equity ownership: Sony Life insurance Co., Ltd. 50%, AEGON international B.V. 50%
Business： Reinsurance businessNote) AEGON Sony Life Insurance and SA Reinsurance are equity method companies, 50-50 joint ventures established by Sony Life and AEGON Group.
*As of November 14, 2014

Sony Bank’s Mortgage Loans through Sony Life
■Sony Life accounts for 24% of the balance of mortgage loans as of September 30, 2014
Sony Life accounts for 17% of the amount of new mortgage loans for FY14.1H*Sony Life started handling banking agency business in January 2008.

Sony Assurance’s
Assurance s Auto Insurance Sold by Sony Life
■Sony Life accounts for approx. 5% of new automobile policies for FY14.1H*Sony Life started handling automobile insurance in May 2001.

Sony Financial Holdings Inc. All Rights Reserved

35

Recent Topics 2<Highlights for FY2014.2Q>
2014-07-09
2014
07 09

Sony Life closed its representative office in Beijing.

2014-07-28

Sony Life entered into an agreement to acquire Sony Corporation’s headquarters site.

2014 08 01
2014-08-01

S
Sony
B
Bank
k enteredt d into
i t tie-upti
withith “S“Sony R
Reall E
Estate”
t t ” iin mortgagetlloans

2014-08-06

Sony Bank started ATM affiliation with Aeon Bank, Ltd.

2014-08-15

S
Sony
B
Bank
k startedd offering
ff i iinterest rates on iits mortgage lloans b
based
d on customers’’
own funds

2014-10-01

Sony Lifecare Group announced the opening of the first newly built nursing care homein Tokyoy in spring,p g 2016

2014-10-02

Sony Life commenced sales of Living Benefit Whole Life Insurance (Living Standard
Type) and Living Standard Special Provision 20142014 11 13
2014-11-13

Sony Assurance announced to launch a PHYD(Pay-How-You-Drive)
PHYD(Pay How You Drive) type of automobile
insurance “Gentle Driving Cash-Back Plan” in Mid-February 2015

Sony Financial Holdings Inc. All Rights Reserved36Sony Life: Fair Value Information on Securities(General Account Assets)
Fair Value Information on Securities
Fair Value Information on Securities(Billions of yen)

Note: Derivative financial products such as principal protected 30 year notes with Nikkei 225 index-linked coupons are included in the “Held-to-maturity-securities” above.
Principal protected 30 year notes with Nikkei 225 index-linked coupons
As of Mar. 31, 2013; Carrying amount: ¥43.3 billion, Fair market value: ¥52.2 billion, Net unrealized gain (losses): ¥8.8 billion
As of Mar. 31, 2014; Carrying amount: ¥43.8 billion, Fair market value: ¥56.0 billion, Net unrealized gain (losses): ¥12.2 billion
As of Sep. 30, 2014; Carrying amount: ¥44.0 billion, Fair market value: ¥57.4 billion, Net unrealized gain (losses): ¥13.3 billion

V l tiValuation
gains
i (losses)(l) on trading-purposet disecurities
iti(Billions of yen)

Notes: Amounts above include those categorized as “monetary trusts.”

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37Sony Life’s Interest Income and Dividends (Details)(Millions of yen)

FY13.1H

FY14.1H

ChangeCash and deposits
Japanese governmentand corporate bonds
Japanese stocks

00+12.2%

47,87452,735+10.2%

198

221+11.7%

Foreign securities

2,868

4,503

+57.0%

Other securities

47

278

+491.1%

Loans

2 820
2,820

2 937
2,937

+4 1%
+4.1%

Real estate

5,145

5,170

+0.5%

17

32

+87.9%

58,97165,879+11.7%

Others
Total

Sony Financial Holdings Inc. All Rights Reserved38Sony Life’s Quarterly Trend on New Policies Amount
Quarterly Trend on New Policy Amount(Billions of yen)

1,201.9

1,200.0

1 238 71,238.7
1,033.3

991.5

947.4

1,000.0

1,135.8

1,128.3

1,066.5

886 2
886.2

841.4
800.0
600 0
600.0
400.0
200.0
0.0
FY12 1Q
FY12.1Q

FY12 2Q
FY12.2Q

FY12 3Q
FY12.3Q

FY12 4Q
FY12.4Q

FY13 1Q
FY13.1Q

FY13 2Q
FY13.2Q

FY13 3Q
FY13.3Q

FY13 4Q
FY13.4Q

FY14 1Q
FY14.1Q

FY14 2Q
FY14.2Q

Sony Financial Holdings Inc. All Rights Reserved

39Sony Life’s Quarterly Trend on
Annualized Premiums from New Policies
Quarterly Trend on Annualized Premiums from New Policies
Annualized premiums from new policies

Of which, third-sector(Billions of yen)

24 0
24.0

22.0

22.0

19.0

20.0
18.0
16.0

18.9

18.5

17.4

17.2

16 8
16.8
15.2

14.6
13.2

14.0
12.0
10.0
8.0
6.0
4.0

4.4

2.0

50
5.0

52
5.2
3.9

3.6

3.0

3.6

2.9

3.7

FY13.4Q
Q

FY14.1Q
Q

2.8

0.0
Q
FY12.1Q

FY12.2Q
Q

FY12.3Q
Q

FY12.4Q
Q

FY13.1Q
Q

FY13.2Q
Q

FY13.3Q
Q

Sony Financial Holdings Inc. All Rights Reserved

FY14.2Q
Q

40

Method of Measuring Risk Amount
Based on Economic Value (1) Market-related Risk*1

Interest rate risk
Fluctuations in net asset
value based on economic
value in response to theshocks in the right columns.
The same applies below.

Sony Life(Reference) EU Solvency II (QIS5)

Percentage increases or decreases differ for eachcurrency and term
term.
As for measuring interest rate risk in Japanese yen,introduced principal component analysis, where yield
curve changes are disaggregated into threecomponents, parallel shift, twist and butterfly, and theyield curve is shocked by each component
component.

Percentage increases or decreases differ for eachcurrency and term but no lower than 1%(Example)
For Yen 30-year, 30% decrease(Example)
For Yen 30-year, 34% decrease (parallel shift),
28% decrease (twist), 7% decrease (butterfly))

Equity risk

Listed equities 45%, Other securities 70%

Global 30%, Others 40%*2

Real estate risk

Actual real estate 25%

Real estate 25%

Credit risk = (market value) x (risk coefficient for eachcredit rating) x duration

Credit risk

Note that durations have caps and floors, depending
on credit ratings.

Same as on the left

(Example)
Rating A: Risk coefficient (1.4%), cap (23), floor (1)30% downside fluctuation

Currency risk

25% downside fluctuation

Notes
1. Principal
p items as of Sep.
p 30, 2014.
2. Standard risk coefficients are global: 39%/other: 49%. Symmetric adjustment (an adjustment of±10% of the average value of the stock price index during a defined period in
the past) is applied; as of the QIS5 trial introduction (December 31, 2009), these were 30%/40%.

Sony Financial Holdings Inc. All Rights Reserved

41

Method of Measuring Risk Amount
Based on Economic Value (2) Insurance Risk*1

Sony Life(Reference) EU Solvency II (QIS5)

Mortalityy risk

Mortalityy rate increases byy 15% for each yearyelapsedpSame as on the leftLongevity risk

Mortality rate decreases by 20% for each year
elapsedSame as on the left

Lapse risk

The largest amount of these; *2

The largest amount of these;•Lapse rate increases by 50% for each year elapsed• Increases by 50% in the assumed rates of• Lapse rate decreases by 50% for each year elapsed

lapsation for Life module, 20% for Health module• 30% of policies on which surrender value is in•Decreases by 50% in the assumed rates ofexcess of best estimate liability are immediately
surrendered• 30% of policies (70% for group annuities, etc.) on

lapsation for Life module, 20% for Health module
which surrender value is in excess of best
estimate liability are immediately surrendered

Expense risk

Disability risk

Operating expenses increase by 10% for each year
elapsedRate of inflation rises by 1%

Same as on the left

Rate of occurrence increases by 35% in the first fiscal Rate of occurrence increases by 35% in the firstyear, risingi ibby 25% forf eachh year thereafterthftfi
fiscall year, rising
i i bby 25% forf eachh year thereafter.
thft
Recovery rate decreases by 20%.

Notes
1. Principal items as of Sep. 30, 2014.
2. At Sony Life, lapse risk is calculated by computing and adding together the largest amount of three options for each insurance policy

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42

JGB Yields

As of the end of each monthSony Financial Holdings Inc. All Rights Reserved

43

Contact:
Communications & Investor Relations Department
Sony Financial Holdings Inc.
Inc
TEL： +81-3-5785-1074

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44