August 14, 2020

SURUGA bank, Ltd.
Consolidated financial results for the three months ended June 30, 2020
<under Japanese GAAP>
Stock exchange listings: Tokyo (code: 8358)
URL:
https://www.surugabank.co.jp
Representative:
Kosuke Saga, President(Amounts and percentages are rounded down to the nearest million yen and first decimal places, respectively.)

1. Consolidated financial results for the three months ended June 30, 2020
(1) Consolidated operating results(% represents the change from the same period in the previous fiscal year)

Ordinary income
Three months ended
June 30, 2020
June 30, 2019

Millions of yen

25,01732,241

Profit attributableto owners of parent

Ordinary profit%

Millions of yen(22.4)
(8.5)

971
6,223

%

Millions of yen(84.3)
31.6

%

507
3,847

(86.8)
21.7(Note) Comprehensive income: (a) Three months ended June 30, 2020: ¥ 1,662 million [ 35.2 % ](b) Three months ended June 30, 2019: ¥ 1,229 million [ (74.5) %]Earnings per share(diluted)

Earnings per shareyenyen
Three months ended
June 30, 2020
2.19
June 30, 2019
16.60
(Note1) Earnings per share for the three months ended June 30, 2020 is not provided because there are no potentially shares.
(Note2) Earnings per share for the three months ended June 30, 2019 is not provided because there are no potentially dilutive shares.

(2) Consolidated financial position
Total assets
As ofJune 30, 2020
March 31, 2020

Total net assets

Net assets ratio

Millions of yen

Millions of yen

3,541,396
3,481,579

257,396
256,892

%

7.2
7.3

(Reference) Shareholders’ equity: (a) As of June 30, 2020: ¥ 257,290 million; (b) As of March 31, 2020: ¥ 256,781 million(Note) Net assets ratio = {(Total net assets - Subscription rights to shares - Non-controlling interests) / Total assets} × 100
This ratio is not calculated based on the “Capital Adequacy Ratio Notification”.

2. Dividends on common stockst

Fiscal year
ended March 31, 2020
ending March 31, 2021
ending March 31, 2021 (forecast)

1 quarter-end
yen――

Dividends per share
2 quarter-end 3rd quarter-end Fiscal year-end
nd

yen

yen

yen

Total
yen

0.00

―

5.00

5.00

0.00

―

5.00

5.00

(Note) Revision of dividend forecast from the latest announcement: No

3. Consolidated earnings forecast for the fiscal year ending March 31, 2021(% represents the change from the previous fiscal year)

Ordinary income
Millions of yen

1H, FY3/2021
FY3/2021

48,50096,000

Profit attributableto owners of parent

Ordinary profit%(24.2)(18.6)

Millions of yen

500
8,000

%

(97.5)(80.8)

Millions of yen(3,500)6,000

Earnings per
share
%

yen

(76.3)(15.10)25.90(Note1) Revision of earnings forecast from the latest announcement: No(Note2) The earning forecast for the fiscal year ending March 31, 2021 was calculated with thought to impacts of the coronavirus(COVID-19) pandemic foreseeable at the present time. However, if the impacts continue for a long time, the earnings forecast
may be revised, for instance, due to further increase in net credit costs. If matters to be disclosed arise, such matters will bepromptly disclosed.

*Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries that caused changes in the scope of
consolidation): No(2) Adoption of any particular accounting methods for quarterly consolidated financial statements: Yes(Note) For details, please refer to page 6 of the appendix “2. Consolidated financial statements and notes, (3) Notes regarding consolidated
financial statements, (Adoption of any particular accounting methods for quarterly consolidated financial statements)”.
(3) Changes in accounting policies, changes in accounting estimates and restatements(A) Changes in accounting policies due to revision of accounting standards: No(B) Changes in accounting policies due to reasons other than (A): No(C) Changes in accounting estimates: No(D) Restatements: No(4) Number of issued shares (common stock)(A) Number of issued shares
As of(including treasury shares):
June 30, 2020
As of(B) Number of treasury shares:June 30, 2020Three months ended(C) Average number of shares:June 30, 2020

232,139,248 shares
489,418 shares
231,649,973 shares

As ofMarch 31, 2020
As ofMarch 31, 2020Three months ended
June 30, 2019

232,139,248 shares
489,165 shares
231,650,876 shares(Note1) This report is outside the scope of the external auditor’s quarterly review procedure.

(Note2) Explanation on appropriate use of forecast and other special items
The performance forecasts and other forward-looking statements in this report are based on information currently available to thecompany and on certain assumptions deemed to be reasonable, and are not intended to guarantee future performance. Actual
performance may differ materially depending on various factors.

Suruga bank, Ltd.

(Appendix)

Table of contents
1. Qualitative information on financial results........................................................................................... 2(1) Details of operating results ............................................................................................................ 2(2) Details of financial position ........................................................................................................... 2(3) Details of forecast information, including earnings forecast ....................................................... 2
2. Consolidated financial statements and notes ......................................................................................... 3(1) Consolidated balance sheets .......................................................................................................... 3(2) Consolidated statements of income and Consolidated statements of comprehensive income ................ 4(3) Notes regarding consolidated financial statements ...................................................................... 6(Notes on going-concern assumption) ............................................................................................ 6(Notes for material changes in shareholders’ equity) ..................................................................... 6(Adoption of any particular accounting methods for quarterly consolidated financial statements)........... 6(Changes in accounting policies, changes in accounting estimates and restatements) ................. 6(Additional information) .................................................................................................................. 6* Financial results for the three months ended June 30, 2020 supplementary information .................... 7−1−

Suruga bank, Ltd.

1. Qualitative information on financial results(1) Details of operating results
As for the consolidated operating results for the three months ended June 30, 2020, ordinary income
decreased by ¥7.224 billion year-on-year to ¥25.017 billion. This was primarily due to the decline in interest
income reflecting the drop in interest on loans and bills discounted. Meanwhile, ordinary expenses decreasedby ¥1.971 billion year-on-year to ¥24.046 billion, mainly due to the fall in fees and commissions payments.
As a result, ordinary profit decreased by ¥5.252 billion year-on-year to ¥0.971 billion.
Profit attributable to owners of parent decreased by ¥3.340 billion year-on-year to ¥0.507 billion.

(2) Details of financial position
As for the consolidated major account balances as of June 30, 2020, deposits amounted to ¥3,265.937 billion,rose by ¥61.146 billion from March 31, 2020, mainly due to an increase of ¥52.956 billion in individual
deposits.
Loans and bills discounted came in at ¥2,466.279 billion, down by ¥36.559 billion from March 31, 2020,
mainly due to a decrease of ¥45.758 billion in consumer loans (non-consolidated).
Securities amounted to ¥182.829 billion, rose by ¥48.969 billion from March 31, 2020.

(3) Details of forecast information, including earnings forecast
The earnings forecast for the fiscal year ending March 31, 2021 remains unchanged from that announced on
May 14, 2020.
Consolidated

Ordinary income
Ordinary profit
Profit attributable toowners of parent
Non-consolidated

Ordinary income
Core net operating profit
Net operating profit
Ordinary profit
Net income(Billions of yen)
Fiscal year ending March 31, 2021
(Forecast)First half
Full year
48.5
96.0
0.5
8.0
(3.5)

6.0

(Billions of yen)
Fiscal year ending March 31, 2021
(Forecast)First half
Full year
43.0
85.0
14.0
27.0
14.0
27.0
0.0
7.0
(4.0)
5.0

Actual credit costs

14.0

20.0

(Note1) The earning forecast for the fiscal year ending March 31, 2021 was calculated with thought to impactsof the coronavirus (COVID-19) pandemic foreseeable at the present time. However, if the impacts
continue for a long time, the earnings forecast may be revised, for instance, due to further increase in
net credit costs. If matters to be disclosed arise, such matters will be promptly disclosed.
(Note2) The performance forecasts and other forward-looking statements in this report are based on
information currently available to the company and on certain assumptions deemed to be reasonable,
and are not intended to guarantee future performance. Actual performance may differ materiallydepending on various factors.

−2−Suruga bank, Ltd.

2. Consolidated financial statements and notes(1) Consolidated balance sheets
As ofMar. 31, 2020
AssetsCash and due from banks
Call loans and bills bought
Trading account securities
Money held in trust
Securities
Loans and bills discounted
Foreign exchanges
Lease receivables and investment assets
Other assets
Tangible fixed assets
Intangible fixed assets
Net defined benefit asset
Deferred tax assets
Customers' liabilities for acceptances and guarantees
Allowance for loan losses
Total assets
Liabilities
Deposits
Borrowed money
Foreign exchanges
Other liabilities
Provision for bonuses
Net defined benefit liability
Provision for directors' retirement benefits
Provision for reimbursement of deposits
Provision for contingent losses
Deferred tax liabilities
Acceptances and guarantees
Total liabilities
Net assets
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Net unrealized gains (losses) on available-for-sale securities
Deferred gains (losses) on hedges
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets−3−（Millions of yen）
As ofJun. 30, 2020

876,30165
180
978133,860
2,502,838
2,215
6,439
52,98037,507
21,56912,66015,8972,062(183,979)
3,481,579

932,116107
161
203
182,8292,466,279
2,244
6,305
50,83737,59921,261
12,957
15,551
1,987(189,046)
3,541,396

3,204,791
3
15,663
491
35
275
270
245
139
707
2,062
3,224,686

3,265,937
0
14,285
29
－
268
284
210
105
889
1,987
3,284,000

30,043
2,045
218,587(561)
250,115
6,276
(23)
412
6,665
111
256,892
3,481,579

30,0432,045
217,937(561)
249,465
7,458
(28)
396
7,825
105
257,396
3,541,396

Suruga bank, Ltd.

(2) Consolidated statements of income and Consolidated statements of comprehensive income
Consolidated statements of income
For the three months
ended
Jun. 30, 201932,241
24,57824,070
409
2,693
2,864
2,103
26,017
387
301
4,830
720
12,557
7,521
6,223
0
0
78
78
－
6,144
2,268
3,876
29
3,847

Ordinary income
Interest income
Interest on loans and bills discounted
Interest and dividends on securities
Fees and commissions
Other operating income
Other income
Ordinary expenses
Interest expenses
Interest on deposits
Fees and commissions payments
Other operating expenses
General and administrative expenses
Other expenses
Ordinary profit
Extraordinary gains
Gains on disposal of non-current assets
Extraordinary losses
Losses on disposal of non-current assets
Impairment loss
Income before income taxes
Income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent−4−（Millions of yen）
For the three months
ended
Jun. 30, 2020
25,017
21,717
21,137
380
2,140
791
368
24,046
399
367
3,160
705
11,336
8,445
971
13
13
102
90
11
881
379
502
(5)
507

Suruga bank, Ltd.

Consolidated statements of comprehensive income

ProfitOther comprehensive income
Net unrealized gains (losses) on available-for-sale securities
Deferred gains (losses) on hedges
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests−5−（Millions of yen）
For the three months For the three months
ended
ended
Jun. 30, 2019
Jun. 30, 2020
3,876
502
(2,498)4(152)(2,646)
1,229

1,181
(4)
(16)
1,160
1,662

1,181
48

1,668
(5)

Suruga bank, Ltd.

(3) Notes regarding consolidated financial statements(Notes on going-concern assumption)
Not applicable.

(Notes for material changes in shareholders’ equity)
Not applicable.

(Adoption of any particular accounting methods for quarterly consolidated financial statements)(Calculation of income taxes)
Income taxes reported by the company and its subsidiaries are calculated by multiplying income before
income taxes for the three months ended June 30, 2020 with the reasonably estimated effective tax rate after
applying tax effect accounting to income before income taxes for the fiscal year ending March 31, 2021,
including the current first quarter.
In addition, in the case that calculating income taxes using the estimated effective tax rate significantly lackrationality, income taxes are calculated by using the statutory effective tax rate.

(Changes in accounting policies, changes in accounting estimates and restatements)
Not applicable.

(Additional information)(Key Assumptions on Estimated Impact from Further Spread of the Coronavirus (COVID-19) Pandemic)
With regard to financial estimates that relate to impact from the coronavirus (COVID-19) pandemic in thefirst quarter of the current consolidated fiscal year, and assumptions that were used for these estimates, there
have been no material changes from the information listed in the (Additional information) section of the
securities report of the previous consolidated fiscal year.
As such assumptions have a high level of uncertainty, if circumstances concerning the spread of thecoronavirus (COVID-19) pandemic and its impact on the economy vary from the original assumptions,financial results could be impacted from the second quarter of the current consolidated fiscal year (second
quarter of the fiscal year ending March, 2021).

−6−

Suruga bank, Ltd.

Financial Results for the three months ended June 30, 2020
- Supplementary Information (1) Operating results for the three months ended June 30, 2020 (Non-consolidated)(Millions of yen)Three months ended Three months ended
Jun. 30, 2020
Jun. 30, 2019

ChangeFY3/2020

Gross operating profit
Net interest income
Net fees and commissions
Net other operating income(Gains (losses) on bonds)
Core gross operating profit (Note1)
Expenses
Personnel expenses
Non-personnel expenses

18,37919,676(1,303)6(
018,37810,456
3,734
5,766

21,542
22,252(2,713)2,003
621,536
11,572
3,684
6,680(a) - (b)(3,163)(2,576)
1,410(1,997)(6)(3,158)(1,116)50(914)Core net operating profit (Note2)
Excluding gains (losses) on
cancellation of investment trusts

7,921

9,964

(2,043)36,334

7,921

9,964

(2,043)36,334

Actual net operating profit (Note3)
Provision for general allowance for loan
losses (Note4)

7,922

9,970

(2,048)36,564(4,707)3,041(7,748)-Net operating profit

12,630

6,928

5,702

36,564

Non-recurring gains (losses)
Gains (losses) on stocks(12,055)(0)(1,340)
1,815(10,715)(1,815)

3,427
5,303

Ordinary profit

575

5,588

(5,013)39,991

Extraordinary gains (losses)
Income before income taxes
Income taxes (Note5)

(74)
500
216

(75)
5,512
2,067

1
(5,012)(1,851)(9,908)30,083
5,609

Net income

284

3,445

(3,161)

24,474(a)(b)

80,34584,965(6,876)2,255
230)
80,11543,78014,87525,603(Millions of yen)
Net credit costs (Note6)
Provision for general allowance for loan
losses (Note4)
Disposal of non-performing loans

7,467

6,517

950

3,809

(4,707)3,041(7,748)-

12,175

3,476

8,699

4,039

Reversal allowance for loan losses (Note4)

-

-

-

229

88

55

33

1,351

7,379

6,462

917

2,457

Recoveries of written-off claims
Actual credit costs (Note7)(Note1) Core gross operating profit = Gross operating profit - Gains (losses) on bonds(Note2) Core net operating profit = Net operating profit + Provision for general allowance for loan losses- Gains (losses) on bonds(Note3) Actual net operating profit = Net operating profit + Provision for general allowance for loan losses(Note4) For the fiscal year ended March 31, 2020, the net amount of reversal of specific allowance for loan losses and provision
for general allowance for loan losses is recorded in reversal of allowance for loan losses, given that the former exceeded
the latter during period.
(Note5) The amount of Income taxes for the fiscal year ended March 31, 2020 is that of Total income taxes.
(Note6) Net credit costs = Provision for general allowance for loan losses + Disposal of non-performing loans- Reversal of allowance for loan losses(Note7) Actual credit costs = Net credit costs - Recoveries of written-off claims.
−7−Suruga bank, Ltd.

(A) Gross operating profit： ¥18.3 billion･Net interest income decreased by ¥2.5 billion year-on-year, mainly due to a decrease in interest on loans and bills
discounted.
･Loan-deposit income decreased by ¥2.7 billion year-on-year.
･Gross operating profit decreased by ¥3.1 billion year-on-year.

Net interest income

Loan-deposit income(Billions of yen)(Billions of yen)

29.0

27.3

27.6

22.2

26.6

19.6

27.7

26.7

21.8

19.1

1Q,
1Q,
1Q,
1Q,
1Q,
FY3/17 FY3/18 FY3/19 FY3/20 FY3/21

1Q,
1Q,
1Q,
1Q,
1Q,
FY3/17 FY3/18 FY3/19 FY3/20 FY3/21(B) Expenses; OHR: 56.8%･Expenses decreased by ¥1.1 billion year-on-year.
･OHR rose year-on-year to 56.8%, mainly due to a decrease in gross operating profit.
(OHR (%) = Expenses / Gross operating profit × 100)

Gross operating profit(Billions of yen)

46.6%

OHR

26.4

56.8%

53.7%

45.7%

43.4%
28.2

26.5

Expenses

21.5

12.3

12.2

12.0

11.5

1Q, FY3/17

1Q, FY3/18

1Q, FY3/19

1Q, FY3/20

18.3

10.4

1Q, FY3/21(C) Core net operating profit: ¥7.9 billion, Net operating profit: ¥12.6 billion･Core net operating profit decreased by ¥2.0 billion year-on-year, mainly due to a decrease in net interest income.
･Net operating profit increased by ¥5.7 billion year-on-year, mainly due to a decrease in provision for generalallowance for loan losses.

Core net operating profit(Billions of yen)

14.3

14.2

1Q, FY3/17

15.9

15.9

14.2

Net operating profit

6.9

15.8
9.9

1Q, FY3/18

1Q, FY3/19

1Q, FY3/20

7.9

12.6

1Q, FY3/21(D) Ordinary profit: ¥0.5 billion, Net income: ¥0.2 billion･Ordinary profit decreased by ¥5.0 billion year-on-year, mainly due to an increase in disposal of non-performing
loans.
･Net income decreased by ¥3.1 billion year-on-year, mainly due to a decrease in ordinary profit.

(E) Actual credit costs: ¥7.3 billion･Net credit costs increased by ¥0.9 billion year-on-year, mainly due to a decrease (¥7.7 billion) in provision forgeneral allowance for loan losses and an increase (¥8.6 billion) in disposal of non-performing loans.
･Actual credit costs, calculated as net credit costs (¥7.4 billion) minus the amount of recoveries of written-off claims
amounted to ¥7.3 billion.
−8−

Suruga bank, Ltd.

(2) Loans and deposits (Non-consolidated)(A) Loans and bills discounted･Loans and bills discounted (period-end balance) decreased by ¥266.8 billion year-on-year.
･Yield on loans and bills discounted dropped by 3 basis points year-on-year to 3.16%.
(Billions of yen）
Jun. 30, 2020(a)Jun. 30, 2019(b)(a) – (b)Mar. 30, 2020

Loans and bills discounted(period-end balance)

2,459.4(266.8)2,726.2

2,496.1

Consumer loans

2,261.2(247.5)2,508.7

2,307.0

Secured loans

2,065.5(211.3)

2,276.8

2,099.0

Unsecured loans

195.7(36.1)

231.8

207.9

2,476.7(305.3)2,782.0

2,664.7

Loans and bills discounted(average balance)

Three months ended
Jun. 30, 2020(a)(Billions of yen)Three months ended
Jun. 30, 2019(b)(a) - (b)New consumer loans

3.8

2.2

1.6

New corporate loans forproperty investment

3.2

3.2

－

(Note) Corporate loans for property investment and asset finance that are defined as new business fields in the
mid-term management plan.

Loans and bills discounted (period-end balance)
Consumer loans (period-end balance)

Yield on loans and bills discounted(Billions of yen)
3,244.0
3,150.4
3,133.8
2,931.8
2,857.3 2,726.2
2,800.2
2,508.7 2,459.4
2,261.2

Jun. 16

Jun. 17

Jun. 18

Jun. 19

Jun. 20

−9−

3.58%

3.57%

3.45%

3.19%

3.16%

Jun. 16

Jun. 17

Jun. 18

Jun. 19

Jun. 20

Suruga bank, Ltd.

Consumer loans
Outstanding balance, yield, delinquency rate by loan category

Loan category
Secured loans
Housing loans
Studio apartment loans
Single building apartment loans
Share house loans
Other secured loans
Unsecured loans
Card loans
Unsecured certificate loans
Consumer loans

Period-end
balance
2,065.5
537.7
188.9
1,144.8
153.9
39.9
195.7
129.2
66.4
2,261.2

Jun. 30, 2020
Yield
Delinquency
rate

3.09%
2.86%
3.40%
3.28%
1.46%
4.85%
10.23%
11.56%
7.65%

4.70%
0.79%
1.92%
3.68%
31.34%
1.29%
1.93%
0.78%
4.15%

3.69%

4.47%

(Billions of yen)Mar. 31, 2020
Period-end
Yield
Delinquency
balancerate2,099.0
3.12%
4.14%
551.3
2.87%
0.59%
195.6
3.41%
1.65%
1,156.1
3.33%
3.34%
154.6
1.47%
27.89%
41.2
4.89%
1.05%
207.9
10.23%
1.76%
138.4
11.52%
0.70%
69.4
7.66%
3.88%
2,307.0

3.74%

3.93%

Corporate loans for property investment
9.9
2.23%
－
6.6
2.19%
(Note1) Delinquency rate＝Loans past due 3 months or more / Loans(Note2) Yield: Yield for customers (excluding guarantee fee, accrued interest), period-end balance basis(Note3) Yield and delinquency rate of Studio apartment loans, secured loans and consumer loans are calculated based on
originals claims before securitization.
(Note4) Corporate loans for property investment: Corporate loans for property investment and asset finance that are
defined as new business fields in the mid-term management plan.

－

Share house loans (Non-performing loans based on the Financial Reconstruction Law)
(Billions of yen)(Non-performing loans)
Total

Jun. 30, 2019
Sep. 30, 2019
Dec. 31, 2019
Mar. 31, 2020
Jun. 30, 2020

248.0
246.1
244.4
192.1
190.4

Claims against
bankrupt andsubstantiallybankrupt obligors
88.3
89.9
91.3
45.9
50.2

Claims withcollection risk

Claims for
special attention

45.0
41.1
36.2
28.9
38.3

93.4
97.7
99.8
100.7
87.4

Subtotal

Normalassets

226.8
228.8
227.4
175.5
176.0

21.2
17.3
17.0
16.5
14.4

(Billions of yen)
Coverage
Allowance
ratioD(B＋D)／A
137.3
92.05%
135.1
91.74%
133.1
91.79%
102.5
91.29%
103.7
92.36%

Collateral or
Unsecuredguarantees, etc.
portionShare house claims
B
C
A
Jun. 30, 2019
248.0
200.6
91.0
157.0
Sep. 30, 2019
246.1
199.3
90.6
155.5
Dec. 31, 2019
244.4
198.4
91.1
153.2
Mar. 31, 2020
192.1
154.7
72.7
119.3
Jun. 30, 2020
190.4
154.0
72.1
118.2
(Note1) Based on obligors of share house loans(Note2) Covered amount: Estimated amount, calculated by multiplying the covered amount including collateral, etc.
with a certain ratio.
(Note3) Total credit balance, share house loan receivables: Loans and bills discounted, suspense payments equivalent
to loans and bills discounted, and accrued interest on loans and bills discounted.
Total

−10−

Suruga bank, Ltd.

Actual credit costs and Allowance for loan losses(Billions of yen)Jun. 30, 2020

Item

Actual credit costs

Allowance

Share house-related loans

1.1

103.7

Investment property loans

5.0

58.6

Housing loans

0.8

5.5

Unsecured loans

0.3

2.9

Business financing loans, etc.

0.0

8.8

Total

7.3

179.7

(Note) Investment property loans: Studio apartment loans, Single building apartment loans, Other secured loans(B) Deposits･Deposits (period-end balance) increased by ¥129.3 billion year-on-year.
･Yield on deposits rose by 1 bases points year-on-year to 0.04%.
（Billions of yen）
Jun. 30, 2020(a)Jun. 30, 2019(b)(a) – (b)Mar. 30, 2020

Deposits (period-end balance)

3,271.1

129.3

3,141.8

3,210.8

Individual deposits

2,568.0

91.1

2,476.9

2,515.1

Deposits (average balance)

3,201.6

132.6

3,069.0

3,099.2

Deposits (period-end balance)

Yield on deposits

Individual deposits (period-end balance)(Billions of yen)
4,089.8
4,071.8
3,871.5
3,228.3
3,122.9
3,043.1 3,141.8 3,271.1
2,568.0
2,476.9

0.10%

0.09%
0.05%
0.03%

Jun. 16

Jun. 17

Jun. 18

Jun. 19

Jun. 20−11−Jun. 16

Jun. 17

Jun. 18

Jun. 19

0.04%

Jun. 20

Suruga bank, Ltd.

(3) Interest margins (Non-consolidated)･Loan-deposit margin (after deduction of expenses, overall) expanded by 16 basis points year-on-year to 1.80%,
mainly due to the decline in the expense ratio.
･Net interest margin (overall) shrunk by 21 basis points year-on-year to 1.00%.

Overall(%)
Three months ended
Jun. 30, 2020(a)Three months ended
Jun. 30, 2019(b)(a) - (b)FY3/2020

Yield on loans and bills discounted

3.16(0.03)

3.19

3.19

Yield on deposits

0.04

0.01

0.03

0.04

Loan-deposit margin(after deduction of expenses)

1.80

0.16

1.64

1.74

Net interest margin

1.00(0.21)

1.21

1.14

Domestic(%)
Three months ended
Jun. 30, 2020(a)Three months ended
Jun. 30, 2019(b)(a) - (b)FY3/2020

Yield on loans and bills discounted

3.16(0.03)

3.19

3.19

Yield on deposits

0.04

0.01

0.03

0.04

Loan-deposit margin(after deduction of expenses)

1.84

0.16

1.68

1.78

Net interest margin

1.04(0.21)

1.25

1.18

Loan-deposit margin (overall)
Loan-deposit margin (after deduction of expenses, overall)
Net interest margin（overall）

3.48%

2.24%

3.48%

2.27%

3.39%

3.15%

2.16%
1.64%

1.39%

1Q, FY3/17

1.58%

1Q, FY3/18

3.11%

1.46%

1Q, FY3/19

−12−

1.21%

1Q, FY3/20

1.80%

1.00%
1Q, FY3/21

Suruga bank, Ltd.

(4) Non-performing loans based on the Financial Reconstruction Law (Non-consolidated)･Non-performing loans based on the Financial Reconstruction Law decreased by ¥19.9 billion year-on-year.
･Non-performing loan ratio rose by 72 basis points year-on-year to 14.72%.

Jun. 30, 2020

Jun. 30, 2019

(Millions of yen)Mar. 31, 2020

Claims against bankrupt andsubstantially bankrupt obligors

98,454116,262

92,639Claims with collection risk

93,644

125,582

80,676Claims for special attention

172,245

142,421

175,923

Total (Non-performing loans based on
the Financial Reconstruction Law)

364,344384,266

349,238

Non-performing loan ratio

14.72%

14.00%

13.90%

Total coverage

273,619

322,165

265,201

Coverage ratio

75.09%

83.83%

75.93%(Note1) Total claims = Loans and bills discounted + Foreign exchanges + Accrued interest + Customers’ liabilities for
acceptances and guarantees + Securities lent + Suspense payment (”Claims for special attention” include only “Loansand bills discounted”)(Note2) The figures above are based on the claim classification as defined in the Article 4 of the “Ordinance for Enforcementof the Act on Emergency Measures for the Revitalization of Financial Functions”.
(Note3) The correspondence between classifications of obligors, etc.
(a) ”Claims against bankrupt and substantially bankrupt obligors” correspond to the claims against “Effectively
bankrupt obligors” or “Bankrupt obligors” under self-assessment.
(b) ”Claims with collection risk” correspond to the claims against “Potentially bankrupt obligors” underself-assessment.
(c) ”Claims for special attention” correspond to the claims which are against “Obligors requiring caution” underself-assessment and classified as “Loans past due 3 months or more” or “Restructured loans”.

Non-performing loan ratio

14.00%

14.72%

Jun.19Jun.20

4.27%
1.13%

0.89%

Jun.16

Jun.17

Jun.18−13−

Suruga bank, Ltd.

(5) Capital adequacy ratio (domestic standard)･Capital adequacy ratio (non-consolidated) rose by 184 basis points year-on-year to 10.49%.

Non-consolidated(Millions of yen)Jun. 30, 2020

Jun. 30, 2019

Mar. 31, 2020

Capital adequacy ratio

10.49%

8.65%

10.28%

Own capital (Core capital)

241,109

219,081

241,438

Core capital: instruments and reserves

265,563

248,110

265,899

Core capital: regulatory adjustments (-)

24,45329,02924,461

Risk-weighted assets

2,297,959

2,531,616

2,347,582

Total required capital

88,57398,06490,574

Consolidated
Jun. 30, 2020

Jun. 30, 2019

(Millions of yen)Mar. 31, 2020

Capital adequacy ratio

10.64%

8.76%

10.42%

Own capital (Core capital)

249,085

225,803249,228Core capital: instruments and reserves

276,275

261,152

276,418

Core capital: regulatory adjustments (-)

27,18935,34927,189Risk-weighted assets

2,340,074

2,575,073

2,390,570

Total required capital

90,25899,802

92,293

Capital adequacy ratio （non-consolidated）
Own capital (non-consolidated)(Billions of yen)

12.01%

12.49%

12.14%
8.65%

317.5

328.2

288.0
219.0

Jun. 16

Jun. 17

10.49%

Jun. 18−14−

Jun. 19

241.1

Jun. 20

Suruga bank, Ltd.

(6) Composition of own capital (domestic standard)Core capital: instruments and reserves(1)
Directly issued qualifying common stock or preferred stock mandatorily convertible into
common stock capital plus related capital surplus and retained earnings
Capital and capital surplus
Retained earnings
Treasury shares (-)
Earnings to be distributed (-)
Accumulated other comprehensive income included in Core capital
Remeasurements of defined benefit plans
Subscription rights to acquire common stock or preferred stock mandatorily convertible into
common stock
Adjusted non-controlling interests (amount allowed to be included in Core capital)
Reserves included in Core capital: instruments and reserves
General allowance for loan losses
Eligible non-cumulative perpetual preferred stock subject to transitional arrangement included
in Core capital: instruments and reserves
Eligible capital instrument subject to transitional arrangement included in Core capital:
instruments and reserves
Capital instrument issued through the measures for strengthening capital by public institutions
included in Core capital: instruments and reserves
45% of revaluation reserve for land included in Core capital: instruments and reserves
Non-controlling interests included in Core capital subject to transitional arrangementsCore capital: instruments and reserves(A)Core capital: regulatory adjustments(2)
Total intangible fixed assets (net of related tax liability, excluding those relating to mortgage
servicing rights)
Goodwill (including those equivalent)
Other intangible fixed assets other than goodwill and mortgage servicing rights
Deferred tax assets that rely on future profitability excluding those arising from temporary
differences (net of related tax liability)
Shortfall of eligible provisions to expected losses
Gains on sale related to securitization transactions
Gains (losses) due to changes in own credit risk on fair valued liabilities
Prepaid pension cost
Net defined benefit asset
Investments in own shares (excluding those reported in the net assets)
Reciprocal cross-holdings in relevant capital instruments issued by other financial institutions
Investments in the capital of banking, financial and insurance entities that are outside thescope of regulatory consolidation (“Other financial institutions”), net of eligible shortpositions, where the bank does not own more than 10% of the issued share capital (amountabove the 10% threshold)Amount exceeding the 10% threshold on specified items
Significant investments in the common stock of Other financial institutions, net of eligible
short positions
Mortgage servicing rights
Deferred tax assets arising from temporary differences (net of related tax liability)
Amount exceeding the 15% threshold on specified items
Core capital: regulatory adjustments(B)
Total capital
Total capital
(A-B)
(C)
Risk-weighted assets(3)
Credit risk-weighted assets
Total of items included in risk-weighted assets subject to transitional arrangements
Amount equivalent to market risk × 12.5
Amount equivalent to operational risk × 12.5
Credit risk-weighted assets adjustments
Amount equivalent to operational risk adjustments
Total amount of risk-weighted assets(D)
Capital adequacy ratio (non-consolidated)
Capital adequacy ratio (non-consolidated)(C/D)
Capital adequacy ratio (consolidated)
Capital adequacy ratio (consolidated)
(C/D)

−15−

(Millions of yen)Jun. 30, 2020
Non-consolidated
Consolidated
239,314

249,465

48,632
191,242561-

32,089217,937
561
396
396

-

-

26,24926,24926,371
26,371

-

-

-

-

-

-

265,56342
276,275

13,536

15,29913,536

1,521
13,778

-

245

8,648
-

9,044
-

-

-

2,268

2,600

-

-

2,268
24,4532,600
27,189241,109

249,085

2,099,981
197,977
2,297,959

2,109,759
230,3142,340,074

10.49%--

10.64%

Suruga bank, Ltd.

(7) Unrealized gains (losses) on securities (Non-consolidated)･Net unrealized gains (losses) on securities decreased by ¥5.4 billion year-on-year.
(Millions of yen)Jun. 30, 2020
Fair
Value
Available-for-sale167,388
securities

Jun. 30, 2019

Net unrealized gains (losses)
Gains

LossesFair
value

Mar. 31, 2020

Net unrealized gains (losses)
Gains

LossesFair
value
118,691

8,035

8,484

448 116,032

13,436

13,948511

Net unrealized gains (losses)
Gains

Losses

6,785

7,386

600

Stocks15,149

6,874

7,087

212

21,658

11,97012,356386

14,125

5,850

6,193

343

Bonds

120,609

288

389

101

89,856

719

719

0

103,146

276

368

92

Others31,629

872

1,007

134

4,517

747

872

125

1,419

659

824

165

(Note1) Stocks of subsidiaries and affiliates are not included since they are not valuated with fair value.
(Note2) Unrealized gains (losses) represent the difference between the fair value as of period-ends and acquisition costs.

(8) Individual deposit assets (Non-consolidated)･Individual deposit assets increased by ¥71.4 billion year-on-year.
･The ratio of investment products to total individual deposit assets dropped by 90 basis points year-on-year to 4.0%.
(Millions of yen)

Individual deposit assets
Yen deposits
Investment products
Foreign currency deposits
Public bonds
Mutual funds
Personal pension plans
Single premium life insurance
The ratio of investment products tototal individual deposit assets

Jun. 30, 2020(a)2,673,668
2,564,223
109,444
3,872
6,734
63,82820,537
14,4714.0%−16−71,44391,172(19,730)(66)(1,436)(13,275)(4,065)(887)

Jun. 30, 2019(b)2,602,225
2,473,051
129,174
3,938
8,170
77,10324,602
15,358(0.9%)

4.9%(a) - (b)Mar. 31, 2020
2,618,226
2,511,282
106,9433,857
7,195
59,88521,312
14,6934.0%