February 14, 2020

SURUGA bank, Ltd.
Consolidated financial results for the nine months ended December 31, 2019
<under Japanese GAAP>
Stock exchange listings: Tokyo (code: 8358)
URL:
https://www.surugabank.co.jp
Representative:
Michio Arikuni, President(Amounts and percentages are rounded down to the nearest million yen and first decimal places, respectively.)

1. Consolidated financial results for the nine months ended December 31, 2019(1) Consolidated operating results(% represents the change from the same period in the previous fiscal year)

Ordinary income
Nine months ended
December 31, 2019
December 31, 2018

Millions of yen

91,472109,046

Profit attributableto owners of parent

Ordinary profit%

Millions of yen(16.1)(7.2)

28,928(78,901)%

Millions of yen%-

19,454(96,165)-(Note) Comprehensive income: (a) Nine months ended December 31, 2019: ¥ 15,141 million [ - %](b) Nine months ended December 31, 2018: (¥ 103,314 million) [ - %]Earnings per share(diluted)

Earnings per share
Nine months ended
December 31, 2019
December 31, 2018

yen

yen

83.98
(415.13)-(Note1)Earnings per share for the nine months ended December 31, 2019 is not provided because there are no potentially shares.
(Note2)Earnings per share for the nine months ended December 31, 2018 is not provided although there was a potential share,a loss was recorded.

(2) Consolidated financial position
Total assets
As ofDecember 31, 2019
March 31, 2019

Total net assets

Net assets ratio

Millions of yen

Millions of yen

3,422,407
3,428,327

257,437
242,308

%

7.4
7.0

(Reference) Shareholders’ equity: (a) As of December 31, 2019: ¥ 256,025 million; (b) As of March 31, 2019: ¥ 241,015 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
1st quarter-end 2nd quarter-end 3rd quarter-end Fiscal year-end
Fiscal year
yen
yen
yen
yen
ended March 31, 2019
―
0.00
―
0.00
ending March 31, 2020―
0.00―
ending March 31, 2020 (forecast)-（not decided）(Note) Revision of dividend forecast from the latest announcement: No

Total
yen

0.00
-（not decided）

3. Consolidated earnings forecast for the fiscal year ending March 31, 2020(% represents the change from the previous fiscal year)

Ordinary income
Fiscal year ending
March 31, 2020

Millions of yen

117,500

Profit attributableto owners of parent

Ordinary profit%(15.8)

Earnings per
share

Millions of yen%

Millions of yen%

30,500-21,000-(Note) Revision of earnings forecast from the latest announcement: Yes

yen

90.65

*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 “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):December 31, 2019
As of(B) Number of treasury shares:
December 31, 2019
Nine months ended(C) Average number of shares:
December 31, 2019

232,139,248 shares

488,835 shares
231,650,669 shares

As ofMarch 31, 2019
As ofMarch 31, 2019
Nine months ended
December 31, 2018

232,139,248 shares
488,242 shares
231,647,945 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 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* Financial results for the nine months ended December 31, 2019 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 nine months ended December 31, 2019, ordinary income
decreased by ¥17.574 billion year-on-year to ¥91.472 billion. The decrease in interest on loans is due to adecrease in loans and bills discounted and a drop yield on loans and bills discounted. This was primarily due tothe decline in interest income reflecting the drop in interest on loans and bills discounted. Meanwhile, ordinary
expenses decreased by ¥125.404 billion year-on-year to ¥62.544 billion, mainly due to the fall in net credit
costs.
As a result, ordinary profit increased by ¥107.829 billion year-on-year to ¥28.928 billion. Profit attributableto owners of parent increased by ¥115.619 billion year-on-year to ¥19.454 billion.

(2) Details of financial position
As for the consolidated major account balances as of December 31, 2019, loans and bills discounted camein at ¥2,584.659 billion, down by ¥319.728 billion from March 31, 2019. This was primarily due to thedecrease (¥262.939 billion) in consumer loans (non-consolidated).
Securities amounted to ¥135.658 billion, down by ¥2.472 billion from March 31, 2019.
Deposits amounted to ¥3,142.568 billion, down by ¥17.036 billion from March 31, 2019, mainly due to adecrease (¥1.989 billion) in individual deposits.

(3) Details of forecast information, including earnings forecast
The Bank has revised its earnings forecast for the fiscal year ending March 31, 2020 from that announced on
November 14, 2019.For details please refer to the document disclosed separately today (February 14, 2020)
titled “Announcement Regarding the Revision to the Earnings Forecast for the Fiscal year ending March 31,
2020”.
Consolidated
Ordinary income
Ordinary profit
Profit attributable toowners of parent

Current forecast (A)
117.5
30.5

Previous forecast (B)
116.5
23.0

(Billions of yen)
Change (A) - (B)
1.0
7.5

21.0

15.5

5.5

Current forecast (A)
104.0
37.0
34.0
29.0
20.0

Previous forecast (B)
103.0
36.0
33.0
22.0
15.0

(Billions of yen)
Change (A) - (B)
1.0
1.0
1.0
7.0
5.0

14.0

19.0

(5.0)

Non-consolidated
Ordinary income
Core net operating profit
Net operating profit
Ordinary profit
Net income
Actual credit costs(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 be reasonable, and are notintended 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
As ofMar. 31, 2019
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
Subscription rights to shares
Non-controlling interests
Total net assets
Total liabilities and net assets−3−（Millions of yen）
As of
Dec. 31, 2019

424,073
561
167
515
133,186
2,904,387
2,407
6,368
62,49348,311
24,601
15,376
13,4002,551(210,076)
3,428,327

746,190151
184
412
135,6582,584,659
2,212
6,450
54,79547,351
22,25016,27815,4162,098(211,703)
3,422,407

3,159,604
740
16
20,999
482
295
246
398
111
572
2,551
3,186,019

3,142,568
560
3
18,112
12
280
259
255
119
699
2,098
3,164,970

30,043
1,202
193,263(560)
223,948
13,352(35)
3,750
17,06712
1,280
242,308
3,428,327

30,043
1,202
212,718(560)
243,403
9,360
(30)
3,291
12,622－
1,412
257,437
3,422,407

Suruga bank, Ltd.

(2) Consolidated statements of income and Consolidated statements of comprehensive income
Consolidated statements of income
For the nine months
ended
Dec. 31, 2018
109,046
86,336
84,533
1,306
9,053
3,139
10,517
187,948
1,626
1,384
10,403
2,269
38,684
134,964(78,901)
2,311
0
－
2,311
2,842
247
2,595
(79,432)
16,820(96,252)(87)(96,165)

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
Gain on reversal of subscription rights to shares
Reversal provision for directors' retirement benefits
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 nine months
ended
Dec. 31, 201991,472
71,91570,738
778
7,852
4,861
6,842
62,544
1,171
940
11,2762,312
35,744
12,03928,928
47
35
12
－
367
364
2
28,608
9,078
19,52974
19,454

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−

For the nine months
ended
Dec. 31, 2018
(96,252)（Millions of yen）
For the nine months
ended
Dec. 31, 201919,529(6,878)(11)(171)(7,062)(103,314)(3,934)4(458)(4,387)
15,141(103,072)(242)

15,009131

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 nine months ended December 31, 2019 with the reasonably estimated effective tax rate
after applying tax effect accounting to income before income taxes for the fiscal year ending March 31, 2020,
including the current third 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.

−6−Suruga bank, Ltd.

Financial Results for the nine months ended December 31, 2019
- Supplementary Information (1) Operating results for the nine months ended December 31, 2019 (Non-consolidated)(Millions of yen)
Nine months ended
Dec. 31, 2019

Nine months ended
Dec. 31, 2018

(a)

(b)

ChangeFY3/2019

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

62,20765,093(5,051)
2,165( 154
62,05332,995
11,18819,00378,29180,822(3,052)521
492
77,79835,45812,18820,347(a) - (b)(16,084)(15,729)(1,999)1,644(338)(15,745)(2,463)(1,000)(1,344)

Core net operating profit (Note2)
Excluding gains (losses) on
Cancellation of investment trusts

29,05842,340(13,282)

52,616

29,05842,036(12,978)

52,312

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

29,212

42,833(13,621)53,1184,586

29,635(25,049)

26,710Net operating profit

24,626

13,197

11,42926,408

Non-recurring gains (losses)
Gains (losses) on stocks

2,818
5,303

(90,651)
7,377

93,469(2,074)(101,393)
7,623

Ordinary profit

27,444(77,454)

104,898(74,985)

Extraordinary gains (losses)
Income before income taxes
Income taxes (Note4)(327)
27,116
8,568(521)(77,975)
16,104

194
105,091(7,536)(703)(75,688)
21,328Net income

18,547(94,080)

112,627(97,016)

99,995
103,916(4,458)537
501)
99,49446,877
15,945
27,162(Millions of yen)
Net credit costs (Note5)
Provision for general allowance forloan losses
Disposal of non-performing loans

8,604

128,747(120,143)

137,060

4,586

29,635(25,049)

26,710Recoveries of written-off claims

4,018
763

99,111
602(95,093)
161

110,349702

Actual credit costs (Note6)

7,841

128,144(120,303)

136,358(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) Income taxes for the fiscal year ended March 31, 2019 are the amount of Total income taxes.
(Note5) Net credit costs = Provision for general allowance for loan losses + Disposal of non-performing loans(Note6) Actual credit costs = Net credit costs - Recoveries of written-off claims−7−Suruga bank, Ltd.

(A) Gross operating profit： ¥62.2 billion･Net interest income decreased by ¥15.7 billion year-on-year, mainly due to a decrease in interest on loans and bills
discounted.
･Loan-deposit income decreased by ¥12.5 billion year-on-year.
･Gross operating profit decreased by ¥16.0 billion year-on-year.

Loan-deposit income

Net interest income(Billions of yen)(Billions of yen)
89.6

80.5

84.5

1-3Q,
FY3/16

1-3Q,
FY3/17

1-3Q,
FY3/18

80.8

65.0

76.3

81.7

84.8

76.7

64.2

1-3Q,
FY3/19

1-3Q,
FY3/201-3Q,
FY3/16

1-3Q,
FY3/17

1-3Q,
FY3/181-3Q,
FY3/19

1-3Q,
FY3/20(B) Expenses; OHR: 53.0%･Expenses decreased by ¥2.4 billion year-on-year.
･OHR rose year-on-year to 53.0%, mainly due to a decrease in gross operating profit.
(OHR (%) = Expenses / Gross operating profit × 100)

Gross operating profit

Expenses

OHR(Billions of yen)
43.7%

43.2%
87.2

83.4

79.3

53.0%

45.2%

40.7%
78.2

34.7

36.1

35.5

35.4

1-3Q, FY3/16

1-3Q, FY3/17

1-3Q, FY3/18

1-3Q, FY3/19

62.2

32.9

1-3Q, FY3/20(C) Core net operating profit: ¥29.0 billion, Net operating profit: ¥24.6 billion･Core net operating profit decreased by ¥13.2 billion year-on-year, mainly due to a decrease in net interest income.
･Net operating profit increased by ¥11.4 billion year-on-year, mainly due to a decrease in provision for generalallowance for loan losses.

Core net operating profit

Net operating profit(Billions of yen)

43.8

44.5

1-3Q, FY3/16

47.1

47.3

1-3Q, FY3/17

51.5

51.2

1-3Q, FY3/18

42.3

13.1

1-3Q, FY3/19

29.0

24.6

1-3Q, FY3/20(D) Ordinary profit: ¥27.4 billion, Net income: ¥18.5 billion･Ordinary profit increased by ¥104.8 billion year-on-year, mainly due to a decrease in actual credit costs.
･Net income increased by ¥112.6 billion year-on-year, mainly due to an increase in ordinary profit.

(E) Actual credit costs: ¥7.8 billion･Net credit costs decreased by ¥120.1 billion year-on-year, mainly due to a decrease (¥25.0 billion) in provision forgeneral allowance for loan losses and a decrease (¥95.0 billion) in disposal of non-performing loans.
･Actual credit costs, calculated as net credit costs (¥8.6 billion) minus the amount of recoveries of written-off claims(¥0.7 billion) amounted to ¥7.8 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 ¥319.7 billion from March 31, 2019.
･Yield on loans and bills discounted dropped by 12 basis points from March 31, 2019 to 3.20%.
(Billions of yen）

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

Dec.31,
2019(a)(a) - (b)Sep.30,2019(b)(b) - (c)Jun.30,2019(c)(c) - (d)Mar.31,
2019(d)(d) - (e)Dec.31,
2018(e)2,579.0(92.6)

2,671.6(54.6)

2,726.2(172.6)2,898.8(69.9)

2,968.7

2,401.9
2,186.9214.9(53.5)(44.6)(8.9)

2,455.4
2,231.5
223.8(53.3)(45.3)(8.0)

2,508.7
2,276.8231.8(156.1)(147.6)(8.5)

2,664.8
2,424.4
240.3(61.3)(53.5)(7.8)

2,726.1
2,477.9248.1

2,700.7(38.6)

2,739.3(42.7)

2,782.0(272.7)

3,054.7(39.0)

3,093.7

Nine months ended
Dec. 31, 2019(a)(Billions of yen)
Nine months ended
Dec. 31, 2018(b)(a) - (b)New consumer loans

3.4(30.3)

33.7

Corporate loans forproperty investment

4.2

－

－

(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)
2,968.7
2,898.8
2,726.2
2,671.6
2,579.0
2,726.1
2,664.8
2,508.7
2,455.4
2,401.9

Dec. 18

Mar. 19

Jun. 19

Sep. 19

Dec. 19

−9−

3.35%

3.32%

3.21%

3.20%

Dec. 18
Mar. 19
Jun. 19
Sep. 19(Note) Based on cumulative period.

Dec. 19

3.19%

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

Dec. 31, 2019
Period-end
Yield
Delinquency
balancerate
2,186.9
3.14%
5.91%
567.0
2.87%
0.66%
203.7
3.41%
1.50%
1,175.2
3.38%
3.46%
198.3
1.80%
42.57%
42.5
4.89%
0.99%
214.9
10.18%
2.00%
142.0
11.47%
0.73%
72.9
7.67%
4.49%
2,401.9

3.76%(Billions of yen)Sep. 30, 2019
Period-end
Yield
Delinquency
balancerate2,231.5
3.17%
5.03%
582.0
2.88%
0.46%
213.0
3.42%
1.32%
1,193.0
3.41%
2.38%
199.2
1.83%
40.66%
44.3
4.89%
0.91%
223.8
10.16%
1.69%
147.6
11.45%
0.69%
76.2
7.66%
3.63%

5.57%

2,455.4

3.79%

4.74%

Corporate loans for property investment
4.2
2.06%
－
－
－
－
(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

Dec. 31, 2018
Mar. 31, 2019
Jun. 30, 2019
Sep. 30, 2019
Dec. 31, 2019

251.5
250.3
248.0
246.1
244.4

Claims against
bankrupt andsubstantiallybankrupt obligors
69.5
86.5
88.3
89.9
91.3

Claims withcollection risk

Claims for
special attention

65.0
51.0
45.0
41.1
36.2

76.2
88.0
93.4
97.7
99.8

Subtotal

Normalassets

210.9
225.6
226.8
228.8
227.4

40.5
24.6
21.2
17.3
17.0

(Billions of yen)
Coverage
Allowance
ratioD(B＋D)／A
136.9
92.21%
139.3
92.20%
137.3
92.05%
135.1
91.74%
133.1
91.79%

Collateral or
Unsecuredguarantees, etc.
portionShare house claims
B
CA
Dec. 31, 2018
251.5
202.2
94.9
156.5
Mar. 31, 2019
250.3
201.9
91.4
158.8
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
(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
Dec. 31, 2019

(Billions of yen)Dec. 31, 2019

Item

Actual credit costs

Allowance

Share house-related loans

(4.8)

133.1

Investment property loans

23.9

61.2

Housing loans

1.0

2.5

Unsecured loans

0.4

1.0

(13.4)－

Business financing other than loans tofounder-affiliated companies, etc.

0.7

3.9

Total

7.8

202.0

Loans to founder-affiliated companies(Note) Investment property loans: Studio apartment loans, Single building apartment loans, Other secured loans(B) Deposits･Deposits decreased (period-end balance) by ¥16.7 billion from March 31, 2019.
･Yield on deposits is 4 bases points.
（Billions of yen）
Dec.31,
2019(a)(a) - (b)Sep.30,2019(b)(b) - (c)Jun.30,2019(c)(c) - (d)Mar.31,
2019(d)(d) - (e)Dec.31,
2018(e)3,148.9(16.0)

3,164.9

23.1

3,141.8(23.8)

3,165.6(63.0)

3,228.6

Individual deposits

2,503.7

47.6

2,456.1(20.8)

2,476.9(28.8)

2,505.7(83.0)

2,588.7

Deposits (average balance)

3,086.7

7.8

3,078.9

9.9

3,069.0(435.2)

3,504.2(109.2)

3,613.4

Deposits (period-end balance)

Deposits (period-end balance)

Yield on deposits

Individual deposits (period-end balance)(Billions of yen)
3,228.6
3,165.6
3,148.9
3,164.9
3,141.8
2,588.7
2,476.9
2,503.7
2,505.7
2,456.1

Dec. 18

Mar. 19

Jun. 19

Sep. 190.05%

Dec. 18

Dec. 19

0.04%

0.03%

0.03%

Mar. 19

Jun. 19

Sep. 19(Note) Based on cumulative period.

−11−

0.04%

Dec. 19

Suruga bank, Ltd.

(3) Interest margins (Non-consolidated)･Loan-deposit margin (after deduction of expenses, overall) shrunk by 25 basis points year-on-year to 1.74%.
･Net interest margin (overall) shrunk by 30 basis points year-on-year to 1.19%.

Overall(%)
Nine months ended
Dec. 31, 2019(a)Nine months ended
Dec. 31, 2018(b)(a) - (b)FY3/2019

Yield on loans and bills discounted

3.20(0.15)

3.35

3.32

Yield on deposits

0.04(0.01)

0.05

0.04

Loan-deposit margin(after deduction of expenses)

1.74(0.25)

1.99

1.93

Net interest margin

1.19(0.30)

1.49

1.45

Domestic(%)
Nine months ended
Dec. 31, 2019(a)Nine months ended
Dec. 31, 2018(b)(a) - (b)FY3/2019

Yield on loans and bills discounted

3.19(0.16)

3.35

3.32

Yield on deposits

0.04(0.01)

0.05

0.04

Loan-deposit margin(after deduction of expenses)

1.78(0.25)

2.03

1.97

Net interest margin

1.23(0.30)

1.53

1.49

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

3.30%

3.27%

1.99%

1.93%

1.49%

1-3Q, FY3/19

1.45%

FY3/19

3.15%

3.17%

3.16%

1.64%

1.72%

1.74%

1.21%

1.21%

1.19%

1Q, FY3/20

1H, FY3/20−12−

1-3Q, FY3/20

Suruga bank, Ltd.

(4) Non-performing loans based on the Financial Reconstruction Law (Non-consolidated)･Non-performing loans based on the Financial Reconstruction Law increased by ¥4.3 billion from March 31, 2019.
･Non-performing loan ratio rose by 173 basis points from March 31, 2019 to 14.41%.

Dec. 31, 2019

Mar. 31, 2019

(Millions of yen)Dec. 31, 2018

Claims against bankrupt andsubstantially bankrupt obligors

140,250

108,391

88,433Claims with collection risk

74,113

136,477

117,910Claims for special attention

159,917

125,099

110,633

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

374,281369,968

316,977

Non-performing loan ratio

14.41%

12.68%

10.60%

Total coverage

301,026

316,426

270,149

Coverage ratio

80.42%

85.52%

85.22%(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

10.60%

Dec.1812.68%

Mar.1914.00%

14.83%

14.41%

Jun.19Sep.19Dec.19−13−

Suruga bank, Ltd.

(5) Capital adequacy ratio (domestic standard)･Capital adequacy ratio (non-consolidated) rose by 103 basis points from March 31, 2019 to 9.83%.

Non-consolidated(Millions of yen)Dec. 31, 2019

Sep. 30, 2019

Mar. 31, 2019

Capital adequacy ratio

9.83%

9.23%

8.80%

Own capital (Core capital)

234,256

228,920

213,796

Core capital: instruments and reserves

261,395

259,723

243,358

Core capital: regulatory adjustments (-)

27,13930,802

29,561

Risk-weighted assets

2,380,704

2,479,648

2,427,051

Total required capital

91,797

95,77797,082

Consolidated
Dec. 31, 2019

Sep. 30, 2019

(Millions of yen)Mar. 31, 2019

Capital adequacy ratio

9.96%

9.33%

8.90%

Own capital (Core capital)

241,762

235,739

220,001

Core capital: instruments and reserves

274,680

272,539

256,130

Core capital: regulatory adjustments (-)

32,91736,80036,129Risk-weighted assets

2,425,431

2,524,020

2,470,880

Total required capital

93,58697,552

98,835

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

8.80%

8.65%

9.23%

9.83%

223.6

213.7

219.0

228.9

234.2

Dec. 18

Mar. 19

Jun. 19

Sep. 19

Dec. 19

9.05%

−14−

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)
December 31, 2019Non-consolidated
Consolidated
234,261

243,403

48,632
186,189560-

31,245
212,718
560
3,291
3,291

-

-

27,13327,13327,27927,279

-

-

-

-

-

-

261,395

706
274,680

14,23816,00914,238

1,586
14,423

-

233

8,070
-

11,362
-

-

-

4,830

5,311

-

-

4,830
27,1395,311
32,917234,256

241,762

2,170,707
209,997
2,380,704

2,182,341
243,090
2,425,431

9.83%

-

-

9.96%

Suruga bank, Ltd.

(7) Unrealized gains (losses) on securities (Non-consolidated)･Net unrealized gains (losses) on securities decreased by ¥6.3 billion from March 31, 2019.
(Millions of yen)Dec. 31, 2019

Mar. 31, 2019

Fair Net unrealized gains (losses)
Value
Gains Losses
Other
securities

Dec. 31, 2018

Net unrealized gains (losses)

Fair
value

Gains

LossesFairvalue

Net unrealized gains (losses)
Gains

Losses120,086

10,921

11,283361 117,364

17,254

17,625371

115,055

14,933

15,535601

Stocks17,848

9,572

9,782

210

26,17015,911

16,160249

25,34913,96014,427467

Bonds

100,627

501

535

34

86,734

658

662

3

85,387

434

439

4

Others

1,611

847

964

117

4,459

683

802

118

4,318

538

668

129

(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 decreased by ¥10.7 billion from March 31, 2019.
･The ratio of investment products to total individual deposit assets declined by 30 basis points from March 31, 2019 to 4.7%.
(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
to total individual deposit assets

Dec. 31, 2019(a)2,624,567
2,499,778
124,789
3,983
7,456
75,88822,50014,9614.7%−16−(10,705)(1,864)(8,841)(125)(847)(4,549)(2,902)(415)

Mar. 31, 2019(b)
2,635,272
2,501,642
133,630
4,108
8,303
80,43725,402
15,376(0.3%)

5.0%(a) - (b)Dec. 31, 2018
2,716,696
2,584,488
132,207
4,269
8,489
77,95026,054
15,4434.8%