August 4, 2017

SURUGA bank, Ltd.
Consolidated financial results for the three months ended June 30, 2017
<under Japanese GAAP>
Stock exchange listings: Tokyo (code: 8358)
URL:
http://www.surugabank.co.jp
Representative:
Akihiro Yoneyama, 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, 2017
(1) Consolidated operating results(% represents the change from the same period in the previous fiscal year)

Ordinary income
Three months ended
June 30, 2017
June 30, 2016

Millions of yen%

37,95334,882

Profit attributableto owners of parent

Ordinary profit
Millions of yen

8.8
(0.9)

%

15,701
13,110Millions of yen

19.7(10.9)%

10,731
8,901

20.5
(8.4)

(Note) Comprehensive income: (a) Three months ended June 30, 2017: ¥13,002 million [200.5%](b) Three months ended June 30, 2016: ¥4,326 million [(56.9)%]

Earnings per share(diluted)

Earnings per share
Three months ended
June 30, 2017
June 30, 2016

yen

yen

46.33
38.45

46.32
38.43

(2) Consolidated financial position
Total assets
As ofJune 30, 2017
March 31, 2017

Total net assets

Net assets ratio

Millions of yen

Millions of yen

4,444,436
4,471,725

350,607
340,379

%

7.8
7.5

(Reference) Shareholders’ equity: (a) As of June 30, 2017: ¥348,131 million; (b) As of March 31, 2017: ¥338,029 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 stock
Dividends per share
1 quarter-end 2 quarter-end 3rd quarter-end Fiscal year-end
stFiscal year
ended March 31, 2017
ending March 31, 2018
ending March 31, 2018 (forecast)

nd

yen

yen

―
―

yen

yen

Total
yen

10.00

―

12.00

22.00

10.50

―

10.50

21.00

(Note) Revision of dividend forecast from the latest announcement: No
Breakdown of fiscal year-end dividend for the fiscal year ended March 31, 2017:(a) Ordinary dividend: ¥11.00; (b) Special dividend: ¥1.00

3. Consolidated earnings forecast for the fiscal year ending March 31, 2018(% represents the change from the same period in the previous fiscal year)

Profit attributableto owners of parent

Ordinary profit
Millions of yen

1H, FY3/2018
FY3/2018

30,00061,500%7.1
5.6(Note) Revision of earnings forecast from the latest announcement: No

Millions of yen

20,50043,000Earnings per share
%

6.6
0.8

yen

88.50
185.65

*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 “(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 June 30, 2017
(including treasury shares):232,139,248 shares

As of March 31, 2017

232,139,248 shares(B) Number of treasury shares:

As of June 30, 2017

525,482 shares

As of March 31, 2017

530,965 shares(C) Average number of shares:Three months ended
June 30, 2017

231,612,301 shares

Three months ended
June 30, 2016

231,503,943 shares(Note) This report is outside the scope of the external auditor’s quarterly review procedure.
(Note) 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 the company 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* Financial results for the three months ended June 30, 2017 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, 2017, ordinary
income increased by ¥3.071 billion year-on-year to ¥37.953 billion. This was primarily due to thegrowth in interest income on the back of the rise in interest on loans and discounts. Ordinary
expenses increased by ¥0.479 billion year-on-year to ¥22.251 billion, mainly due to the rise in otherexpenses.
As a result, ordinary profit increased by ¥2.591 billion year-on-year to ¥15.701 billion.
Profit attributable to owners of parent increased by ¥1.830 billion year-on-year to ¥10.731 billion.

(2) Details of financial position
As for the major account balances as of June 30, 2017 on a consolidated basis, deposits were
¥4,062.337 billion, down by ¥33.172 billion from March 31, 2017 despite an increase in individual
deposits of ¥37.536 billion.
Loans and bills discounted came in at ¥3,244.690 billion, down by ¥9.033 billion from March 31,2017 despite an increase in consumer loans (non-consolidated) of ¥24.509 billion.
Securities were ¥132.929 billion, down by ¥15.598 billion from March 31, 2017.

(3) Details of forecast information, including earnings forecast
The earnings forecast for the fiscal year ending March 31, 2018 remains unchanged from thatannounced on May 11, 2017.
Consolidated
1H, FY3/2018
30.0(Billions of yen)
FY3/2018
61.5

20.5

43.0

Net operating profit
Ordinary profit
Net income

1H, FY3/2018
31.5
29.0
20.0

(Billions of yen)
FY3/2018
65.0
60.0
42.0

Actual credit costs

2.3

4.5

Ordinary profit
Profit attributable toowners of parent
Non-consolidated(Note) 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 bereasonable, and are not intended to guarantee future performance. Actual performance may
differ materially depending on various factors.

-2-

SURUGA bank, Ltd.

2. Consolidated financial statements and notes(1) Consolidated balance sheets（Millions of yen）
As of
March 31, 2017
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
Provision for directors' 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
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Subscription rights to shares
Non-controlling interests
Total net assets
Total liabilities and net assets
-3-

As of
June 30, 2017927,519
2,276
72
1,149
148,527
3,253,723
2,885
5,479
56,90951,90628,591
7,787
860
3,340
(19,305)
4,471,725

917,170
2,421
83
1,203
132,9293,244,690
2,791
5,471
63,92952,22228,357
8,418
806
3,280
(19,339)4,444,436

4,095,509
1,540
40
25,503
715
173
279
3,280
287
169
505
3,340
4,131,346

4,062,337
1,435
31
21,270
29
―
254
3,317
256
200
1,415
3,280
4,093,829

30,043
4
291,063(606)
320,504
17,153(61)433
17,52524
2,325
340,379
4,471,725

30,043
4
299,015(601)
328,462
19,087(72)
654
19,66822
2,453
350,6074,444,436

SURUGA bank, Ltd.

(2) Consolidated statements of income andConsolidated statements of comprehensive income
Consolidated statements of income（Millions of yen）
For the three months For the three months
ended
ended
June 30, 2016
June 30, 201734,882
37,95330,17232,27329,42130,858
507
1,082
3,319
3,368
954
946
436
1,363
21,772
22,251
1,095
1,005
1,056
948
3,652
3,771
999
814
13,33013,3602,694
3,299
13,11015,701
2
1
2
1
84
142
84
142
13,027
15,560
4,053
4,745
8,974
10,81572
84
8,901
10,731

Ordinary income
Interest income
Interest on loans and discounts
Interest and dividends on securities
Fees and commissions
Other ordinary income
Other income
Ordinary expenses
Interest expenses
Interest on deposits
Fees and commissions payments
Other ordinary 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
Income before income taxes
Income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent-4-

SURUGA bank, Ltd.

Consolidated statements of comprehensive income（Millions of yen）
For the three months For the three months
ended
ended
June 30, 2016
June 30, 2017
ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or 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-

8,974

10,815(4,626)37(59)(4,647)
4,326

1,977
(10)
220
2,187
13,0024,280
46

12,874128

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, 2017 with the reasonably estimatedeffective tax rate after applying tax effect accounting to income before income taxes for the fiscal
year ending March 31, 2018, including the current first quarter.

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

-6-

SURUGA bank, Ltd.

Financial Results for the three months ended June 30, 2017
- Supplementary Information (1) Operating results for the three months ended June 30, 2017 (Non-consolidated)(Millions of yen)

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
Core net operating profit (Note2)
Actual net operating profit (Note3)
Provision for general allowance forloan losses (Note4)
Net operating profit
Non-recurring gains (losses)
Gains (losses) on stocks
Ordinary profit
Extraordinary gains (losses)
Income before income taxes
Income taxes (Note5)
Net income
Net credit costs (Note6)
Provision for general allowance
for loan losses (Note4)
Disposal of non-performing loans
Reversal of allowance for loan
losses (Note4)
Recoveries of written-off claims
Actual credit costs (Note7)

Three months ended
Jun. 30, 2017 Jun. 30, 2016
(A)
(B)
28,23926,54329,062
27,348
(842)
(684)
19
(120)
4
(139)
28,235
26,682
12,25812,376
4,577
4,804
6,427
6,290
15,976
14,306
15,98014,167(A) - (B)FY3/2017

1,696
1,714
(158)
139
143
1,553
(118)
(227)
137
1,670
1,813

110,852
112,940(2,324)236
165
110,686
47,24018,362
25,131
63,44563,611

76

(74)

150

-

15,904(978)857
14,926(139)
14,787
4,539
10,247

14,241(1,458)(61)
12,782(80)
12,702
3,899
8,803

1,663
480
918
2,144
(59)
2,085
640
1,444

1,644

1,612

32

63,611(6,450)(506)
57,1601,853
59,013
17,28541,728(Millions of yen)
6,575

76

(74)

150

-

1,568

1,687

(119)

9,165

-

-

-

2,590

263
1,381

300
1,312

(37)
69

1,004
5,571

(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, 2017, the net amount of Reversal of general allowance for loan losses
and Provision for specific allowance for loan losses is recorded in Reversal of allowance for loan losses,
given that the former exceeded the latter during the period.
(Note5) Income taxes for the fiscal year ended March 31, 2017 are the amount 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.

(2) Non-performing loans based on the Financial Reconstruction Law (Non-consolidated)
Jun. 30, 2017

Jun. 30, 2016

(Millions of yen)Mar. 31, 2017

Claims against bankrupt andsubstantially bankrupt obligors

7,929

7,529

7,721

Claims with collection risk

12,595

15,051

12,724Claims for special attention

8,681

13,347

8,512

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

29,20535,92828,957

The ratio of non-performing loans tototal claims (Non-performing loan ratio)

0.89%

1.13%

0.88%

(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 “Loans and bills discounted”)(Note2) The figures above are based on the claim classification as defined in the Article 4 of the “Ordinance for
Enforcement of 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”
under self-assessment and classified as “Loans past due 3 months or more” or “Restructured loans”.

(3) Capital adequacy ratio (domestic standard)
Non-consolidated
Capital adequacy ratio
Own capital (Core capital)
Core capital: instruments and reserves
Core capital: regulatory adjustments (-)
Risk-weighted assets
Total required capital

Jun. 30, 201712.49%
317,567
331,582
14,014
2,541,520
101,660

Jun. 30, 201612.01%
288,021296,569
8,548
2,396,562
95,862(Millions of yen)Mar. 31, 201711.96%
307,293
321,254
13,9602,567,492
102,699

Jun. 30, 201612.15%
295,157
306,453
11,2962,427,463
97,098(Millions of yen)Mar. 31, 201712.17%
315,893332,238
16,3452,594,699
103,787

Consolidated
Capital adequacy ratio
Own capital (Core capital)
Core capital: instruments and reserves
Core capital: regulatory adjustments (-)
Risk-weighted assets
Total required capital

Jun. 30, 201712.70%
326,470
343,231
16,7602,569,098
102,763(Note) Total required capital = Risk-weighted assets × 4%

-8-

SURUGA bank, Ltd.

(4) Composition of own capital (domestic standard)(Millions of yen)Jun. 30, 2017
Non-consolidated
Consolidated
Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangementsCore capital: instruments and reserves(1)
Directly issued qualifying common stock or preferred stock mandatorily
convertible into common stock capital plus related capital surplus andretained 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 reserve for possible loan losses
Eligible non-cumulative perpetual preferred stock subject to transitionalarrangement included in Core capital: instruments and reserves
Eligible capital instrument subject to transitional arrangement included inCore 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 transitionalarrangementsCore capital: instruments and reserves(A)Core capital: regulatory adjustments(2)
Total intangible fixed assets (net of related tax liability, excluding thoserelating to mortgage servicing rights)
Goodwill (including those equivalent)
Other intangible fixed assets other than goodwill and mortgage servicing
rightsDeferred tax assets that rely on future profitability excluding those arisingfrom temporary differences (net of related tax liability)
Shortfall of eligible provisions to expected losses
Gains on sale related to securitization transactions
Gains and 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 otherfinancial institutions
Investments in the capital of banking, financial and insurance entities thatare outside the scope of regulatory consolidation (“Other financial
institutions”), net of eligible short positions, where the bank does not own
more than 10% of the issued share capital (amount above the 10% threshold)Amount exceeding the 10% threshold on specified items
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 transitionalarrangements
Intangible fixed assets other than goodwill and mortgage servicing
rights (net of related tax liability)_
Deferred tax assets (net of related tax liability)
Prepaid pension cost _Net defined benefit asset
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)

-9-

322,578

328,462

48,633
274,546601-

30,047
299,015
601
392
392

22

22

-

-

8,981
8,981

12,636
12,636

-

-

-

-

-

-

-

-

-

1,717

331,582

343,231

10,884

7,256

12,970

7,373

-

-

1,909

-

10,884

7,256

11,060

7,373

-

-

267

-

3,128
2

2,085
-

3,520
2

2,346
-

-

-

-

-

-

-

-

-

14,014-

16,760-317,567

326,470

2,332,444

2,336,460

13,402

14,752

10,410

10,5782,991
209,075
2,541,520

806
3,367
232,638
2,569,098

12.49%--

12.70%SURUGA bank, Ltd.

(5) Unrealized gains (losses) on securities (Non-consolidated)(Millions of yen)Jun. 30, 2017
Jun. 30, 2016
Mar. 31, 2017
Fair Unrealized gains (losses) Fair Unrealized gains (losses) Fair Unrealized gains (losses)
value
Gains Losses value
Gains Losses value
Gains Losses
Other
467 83,674 15,556 18,943
3,386 90,702 23,353 23,840
487
securities 104,564 25,996 26,463
Stocks 45,151 24,434 24,521
87 41,956 16,379 17,714
1,334 47,380 21,955 22,088
132
Bonds 50,247(215)
52
268 21,957
171
171
0 30,910
(115)
62
178
Others
9,165
1,777
1,889
111 19,760
(994)
1,057
2,052 12,411
1,512
1,689
176
(Note1) Not measured at fair value, the stocks of subsidiaries and affiliates are not included.
(Note2) Unrealized gains (losses) represent the difference between the fair value as of period-ends and acquisition
costs.
(Note3) Unrealized gains (losses) on held-to-maturity bonds were as shown in the table below.
(Millions of yen)Jun. 30, 2017
Jun. 30, 2016
Mar. 31, 2017
Unrealized
gains(losses)
Unrealized
gains(losses)
Unrealized
gains (losses)
Book
Book
Book
value
value
value
Gains Losses
Gains Losses
Gains Losses
Held-tomaturity
14,9991
1- 135,039
208
208- 45,001
22
22
bonds

(6) Individual deposit assets (Non-consolidated)(Millions of yen)

Individual deposit assets
Yen deposits
Investment products
Foreign currency
deposits
Public bonds
Mutual funds
Personal pension
plansSingle premium life
insurance
The ratio of investment
products to total
individual deposit assets

82,781
105,065(22,284)(A - B)
/ (B)
2.4%
3.3%
(11.1)%

Jun. 30, 2016
(B)
3,316,236
3,116,946
199,290

6,362

311

5.1%

6,051

6,386

9,629
106,280(3,404)(4,879)(26.1)%(4.3)%

13,033111,15910
107,988

40,363(13,893)(25.6)%

54,25643,781

14,370(420)(2.8)%

14,79014,290(0.8)%

6.0%

5.1%

Jun. 30, 2017
(A)
3,399,017
3,222,011
177,006(A) - (B)5.2%

- 10 -

Mar. 31, 2017
3,356,908
3,184,451
172,456SURUGA bank, Ltd.

(7) Deposits and loans (Non-consolidated)(Millions of yen)Jun. 30, 2017
(A)(A) - (B)

4,071,808(18,010)3,228,373

Deposits(period-end balance)
Individual deposits
Loans and bills discounted(period-end balance)
Consumer loans
Housing loans(A - B)/ (B)Jun. 30, 2016
(B)

Mar. 31, 2017(0.4)%

4,089,818

4,105,455

105,376

3.3%

3,122,997

3,190,837

3,244,003

110,115

3.5%

3,133,888

3,253,790

2,931,858
2,046,578

131,61045,8674.6%
2.2%

2,800,248
2,000,711

2,907,349
2,040,621

Three months
ended
Jun. 30, 2017
(A)(A) - (B)

4,059,635

31,1330.7%

4,028,502

4,054,508

3,215,393

116,148

3.7%

3,099,245

3,136,010

Deposits(average balance)
Loans and bills discounted(average balance)(A - B)/ (B)Three months
ended
Jun. 30, 2016
(B)

FY3/2017(Billions of yen)Three months ended
Jun. 30, 2017
New consumer loans

FY3/2017

109.0(Reference) Business alliance with Japan Post Bank
Three months ended
Jun. 30, 2017
New housing loans

470.0(Billions of yen)
FY3/2017

8.4

39.9

(8) Interest margins (Non-consolidated)
Overall

Yield on loans and bills discounted
Yield on deposits
Loan-deposit margin(after deduction of expenses)
Net interest margin(%)
Three months
ended
Jun. 30, 2017
(A)
3.57
0.09

(0.01)(0.01)

Three months
ended
Jun. 30, 2016
(B)
3.58
0.10

2.27

0.03

2.24

2.35

1.58

0.19

1.39

1.54

(A) - (B)

Domestic

Yield on loans and bills discounted
Yield on deposits
Loan-deposit margin(after deduction of expenses)
Net interest margin

FY3/2017
3.62
0.10

(%)
Three months
ended
Jun. 30, 2017
(A)
3.58
0.08

(0.01)(0.02)

Three months
ended
Jun. 30, 2016
(B)
3.59
0.10

2.30

0.04

2.26

2.38

1.62

0.19

1.43

1.58

- 11 -(A) - (B)FY3/2017
3.62
0.09