November 14, 2019

SURUGA bank, Ltd.
Consolidated financial results for the six months ended September 30, 2019
<under Japanese GAAP>
Stock exchange listings: Tokyo (code: 8358)
URL:
https://www.surugabank.co.jp
Representative:
Michio Arikuni, President
Dividend payment date: ―(Amounts and percentages are rounded down to the nearest million yen and first decimal places, respectively.)

1. Consolidated financial results for the six months ended September 30, 2019(1) Consolidated operating results(％ represents the change from the same period in the previous fiscal year)

Ordinary income

Profit attributableto owners of parent

Ordinary profit

Six months ended
Millions of yen％
Millions of yen％
Millions of yen％
September 30, 2019
64,062(14.6)
20,09915,972September 30, 201875,027(0.9)(85,726)(100,785)(Note)Comprehensive income:(a) Six months ended Sep. 30, 2019: ¥11,386 million [-%]; (b) Six months ended Sep. 30, 2018: ¥(103,360) million [- %]Earnings per share(diluted)

Earnings per share
Six months ended
September 30, 2019
September 30, 2018

yen

yen

68.95
(435.08)-(Note1)Earnings per share for the six months ended September 30, 2019 is not provided because there are no potentially shares.
(Note2)Earnings per share for the six months ended September 30, 2018 is not provided although there was a potential share,a loss was recorded.
(2) Consolidated financial position
Total assets
Total net assets
Net assets ratio
As ofMillions of yen
Millions of yen％
September 30, 2019
3,441,501
253,681
7.3
March 31, 2019
3,428,327
242,308
7.0(Reference) Shareholders’ equity:(a) As of September 30, 2019: ¥252,357 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 stockst

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

1 quarter -end
Fiscal year
yen
yen
ended March 31, 2019
0.00
ending March 31, 2020
0.00
ending March 31, 2020 (forecast)(Note) Revision of dividend forecast from the latest announcement: No

yen

Total

yen

yen

-

0.00

0.00

-

-（not decided）-（not decided）

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

Ordinary income

Profit attributableto owners of parent

Ordinary profit

Fiscal year ending
Millions of yen%
Millions of yen
March 31, 2020
116,500(16.5)
23,000(Note) Revision of earnings forecast from the latest announcement: Yes

Earnings per
share

%

Millions of yen

%

yen

-

15,500-66.91

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries that caused changes in the scope of
consolidation): No(2) 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(3) Number of issued shares (common stock)(A) Number of issued shares
As of Sep. 30, 2019
(including treasury shares):(B) Number of treasury shares:

As of Sep. 30, 2019

(C) Average number of shares:

Six months ended
Sep. 30, 2019

232,139,248 shares

As of Mar. 31, 2019

232,139,248 shares

488,639 shares

As of Mar. 31, 2019488,242 shares

231,650,754 shares

Six months ended
Sep. 30, 2018

231,646,282 shares(Summary of non-consolidated financial results)
1. Non-consolidated financial results for the six months ended September 30, 2019(1) Non-consolidated operating results(％ represents the change from the same period in the previous fiscal year)
Ordinary income
Ordinary profit
Net income
Six months ended
Millions of yen%
Millions of yen%
Millions of yen%
September 30, 201957,133(18.6)
19,38815,638September 30, 201870,2392.7(83,737)(98,280)
Earnings per share
Six months ended
September 30, 2019
September 30, 2018

yen

67.50
(424.26)(2) Non-consolidated financial position
Total assets
Total net assets
Net assets ratio
As ofMillions of yen
Millions of yen%
September 30, 2019
3,424,637
239,084
6.9
March 31, 2019
3,412,017
227,947
6.6(Reference) Shareholders’ equity:(a) As of September 30, 2019: ¥239,084 million; (b) As of March 31, 2019: ¥227,935 million(Note) Net assets ratio = {(Total net assets - Subscription rights to shares) / Total assets} × 100
This ratio is not calculated based on the “Capital Adequacy Ratio Notification”.

2. Non-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

Ordinary profit

Earnings per
share

Net income

Millions of yen%

Millions of yen%

Millions of yen%

yen

103,000(19.1)

22,000-15,000-64.75(Note) This report is outside the scope of audit procedures by certified public accountants or audit firms.
(Note) Explanation on appropriate use of forecast and other special items
1. The company is a “Specified business company” under the Article 17-15-2 of the “Cabinet Office Ordinance regarding Disclosure of
Corporate Information, etc.” and prepares its interim consolidated and interim non-consolidated financial statements for the six months
ended September 30, 2019.
2. 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 consolidated earnings forecast ··················· 2
2. Consolidated financial statements and notes ························································· 3(1) Consolidated balance sheets········································································ 3(2) Consolidated statements of income andConsolidated statements of comprehensive income ············································ 4(3) Consolidated statements of changes in net assets ··············································· 6(4) Notes regarding consolidated financial statements ·············································· 8(Notes on going-concern assumption)····························································· 8(Changes in accounting policies, changes in accounting estimates and restatements) ······ 8
3. Non-consolidated financial statements ······························································· 9(1) Non-consolidated balance sheets ·································································· 9(2) Non-consolidated statements of income ························································· 11(3) Non-consolidated statements of changes in net assets ········································* Financial results for the six months ended September 30, 2019 supplementary information

−1−

12

Suruga bank, Ltd.

1. Qualitative information on financial results(1) Details of operating results
As for the consolidated operating results for the six months ended September 30, 2019, ordinary
income decreased by ¥10.965 billion year-on-year to ¥64.062 billion. The decrease in interest on
loans is due to a decrease in loans and bills discounted and a drop yield on loans and bills discounted.
This was primarily due to the decline in interest income reflecting the drop in interest on loans andbills discounted. Meanwhile, ordinary expenses increased by ¥116.791 billion year-on-year to¥43.962 billion, mainly due to the fall in net credit costs.
As a result, ordinary profit increased by ¥105.825 billion year-on-year to ¥20.099 billion. Profit
attributable to owners of parent increased by ¥116.757 billion year-on-year to ¥15.972 billion.

(2) Details of financial position
As for the consolidated major account balances as of September 30, 2019, loans and bills
discounted came in at ¥2,677.686 billion, down by ¥226.701 billion from March 31, 2019. This wasprimarily due to the decrease (¥209.371 billion) in consumer loans (non-consolidated).
Securities amounted to ¥129.889 billion, down by ¥3.297 billion from March 31, 2019.
Deposits amounted to ¥3,159.046 billion, down by ¥0.558 billion from March 31, 2019, mainly
due to a decrease (¥49.630 billion) in individual deposits.

(3) Details of forecast information, including consolidated earnings forecast
The Bank has revised its earnings forecast for the fiscal year ending March 31,
2020 from that announced on August14, 2019. For details, please refer to the
document disclosed separately today (November 14, 2019) titled “Announcement
Regarding the Difference between the Forecast and Actual Results for the Six
Months Ended September 30, 2019 and a Revision to the Earnings Forecast for the
Fiscal year ending March 31, 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, 2020
116.5
23.0
15.5
(Billions of yen)

Fiscal year ending
March 31, 2020
103.0
36.0
33.0
22.0
15.0

Actual credit costs

19.0(Note) The performance forecasts and other forward-looking statements in this report are basedon 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.

−2−Suruga bank, Ltd.

2. Consolidated financial statements and notes(1) Consolidated balance sheets（Millions of yen）
As of
Mar. 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−

As of
Sep. 30, 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

679,381551
157
416
129,889
2,667,686
2,501
6,599
48,51347,721
22,94815,96818,8052,499(212,138)
3,441,501

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

3,159,046
605
11
23,559
511
286
238
285
86
688
2,499
3,187,819

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
209,236(560)
239,921
9,024
(33)
3,444
12,436
1,324
253,681
3,441,501

Suruga bank, Ltd.

(2) Consolidated statements of income and Consolidated statements of comprehensive income(2) Consolidated statements of income
For the six months
ended
Sep. 30, 201875,02758,51257,190
921
6,105
2,283
8,125
160,753
1,185
1,027
7,170
1,537
25,856125,002(85,726)
2,311
0
2,311
2,739
143
2,595
(86,153)
10,132
4,551
14,684(100,837)(52)(100,785)

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 - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent−4−（Millions of yen）
For the six months
ended
Sep. 30, 2019
64,062
48,55947,858
458
5,397
3,970
6,134
43,962
777
610
8,023
1,524
24,385
9,251
20,099
47
34
12
253
251
2
19,892
7,171(3,269)3,902
15,99017
15,972

Suruga bank, Ltd.

Consolidated statements of comprehensive income（Millions of yen）
For the six months
For the six months
ended
ended
Sep. 30, 2018
Sep. 30, 2019(100,837)
15,990

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−(2,425)17(114)(2,522)(103,360)(4,301)
2(305)(4,604)
11,386(103,307)(52)

11,34243

Suruga bank, Ltd.

(3) Consolidated statements of changes in net assets
For the six months ended September 30, 2018
（Millions of yen）
Shareholders' equity
CapitalsurplusCapital stock
Balance at beginning ofcurrent period
Changes of items during
period30,043Retainedearnings

489

Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
shares292,841

Total
shareholders'equityTreasuryshares(582)

322,791(2,432)(2,432)(100,785)(100,785)

(0)

(0)

(0)

23

22

Net changes of items otherthan shareholders' equity

Total changes of items during
periodBalance at end of current
period-(0)(103,217)

22(103,195)

30,043488

189,624(560)

219,595

Accumulated other comprehensive income
Total
accumulated
othercomprehensive income

Subscription
rights toshares

Noncontrollinginterests

17

2,078

Net unrealized
Remeasuregains (losses) Deferred gains
ments ofon available(losses) on
definedfor-salehedgesbenefit planssecurities

Balance at beginning ofcurrent period
Changes of items during
period18,489

(15)

1,402

19,876

Dividends of surplus

Total changes of items during
periodBalance at end of current
period344,763(2,432)

Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesNet changes of items otherthan shareholders' equity

Total net
assets(100,785)(0)22(2,425)17(114)(2,522)(5)(52)(2,580)(2,425)17(114)(2,522)(5)(52)(105,776)

16,063

2

1,288

17,35412

2,025

238,987−6−

Suruga bank, Ltd.

For the six months ended September 30, 2019
（Millions of yen）
Shareholders' equity
CapitalsurplusCapital stock
Balance at beginning ofcurrent period
Changes of items during
period30,043Retainedearnings

1,202

193,263

Total
shareholders'equityTreasuryshares(560)

223,948

Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
shares15,972(0)

15,972
(0)

(0)

0

0

Net changes of items otherthan shareholders' equity

Total changes of items during
periodBalance at end of current
periodBalance at beginning ofcurrent period
Changes of items during
period-(0)

15,972(0)

15,97230,043

1,202

209,236(560)

239,921

Accumulated other comprehensive income
Total
Net unrealized
Remeasureaccumulated
gains (losses) Deferred gains
ments ofon availableother(losses) on
definedfor-salehedgescomprehenbenefit planssecurities
sive income

Subscription
rights toshares

Noncontrollinginterests

12

1,280

13,352

(35)

3,750

17,067

Total net
assets242,308

Dividends of surplus
Profit attributable toowners of parent
Purchase of treasury
shares
Disposal of treasury
sharesNet changes of items otherthan shareholders' equity

Total changes of items during
periodBalance at end of current
period15,972(0)
0(4,327)2(305)(4,630)(12)

43(4,599)(4,327)2(305)(4,630)(12)

43

11,373

9,024

(33)

3,444

12,436-

1,324

253,681−7−

Suruga bank, Ltd.

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

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

−8−Suruga bank, Ltd.

3. Non-consolidated financial statements(1) Non-consolidated balance sheets（Millions of yen）
As of
Mar. 31, 2019
AssetsCash and due from banks
Call loans
Trading account securities
Money held in trust
Securities
Loans and bills discounted
Foreign exchanges
Other assets
Other
Tangible fixed assets
Intangible fixed assets
Prepaid pension cost
Deferred tax assets
Customers' liabilities for acceptances and guarantees
Allowance for loan losses
Total assets
Liabilities
Deposits
Foreign exchanges
Other liabilities
Income taxes payable
Lease obligations
Other
Provision for bonuses
Provision for directors' retirement benefits
Provision for reimbursement of deposits
Provision for contingent losses
Acceptances and guarantees
Total liabilities

−9−

As of
Sep. 30, 2019423,646561
167
515
136,166
2,898,864
2,407
54,44554,44547,082
22,546
9,995
13,7742,551(200,708)
3,412,017

678,601
551
157
416
132,544
2,671,642
2,501
40,23040,23046,672
21,035
11,032
19,0932,499(202,342)
3,424,637

3,165,680
16
14,632
7,556
434
6,641
434
245
398
111
2,551
3,184,070

3,164,941
11
17,028
7,349
410
9,268
463
236
285
86
2,499
3,185,553

Suruga bank, Ltd.

（Millions of yen）
As of
Mar. 31, 2019
Net assets
Capital stock
Capital surplus
Legal capital surplus
Other capital surplus
Retained earnings
Legal retained earnings
Other retained earnings

30,043
18,58918,585
3
167,641
30,043
137,598
59
103,032
34,506(560)
215,714
12,250(29)
12,221
12
227,947
3,412,017

Reserve for advanced depreciation of non-current assets

General reserve
Retained earnings brought forward
Treasury shares
Total shareholders' equity
Net unrealized gains (losses) on available-for-sale securities

Deferred gains (losses) on hedges
Total valuation and translation adjustments
Subscription rights to shares
Total net assets
Total liabilities and net assets

−10−

As of
Sep. 30, 2019
30,043
18,58918,585
3
183,280
30,043
153,237
59
103,032
50,145(560)
231,352
7,759
(27)
7,731
239,084
3,424,637

Suruga bank, Ltd.

(2) Non-consolidated statements of income

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
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 - current
Income taxes - deferred
Total income taxes
Net income

For the six months
ended
Sep. 30, 201870,23956,77152,930
3,440
5,038
543
7,886
153,977
1,194
1,027
7,154
30
23,497122,100(83,737)
2,311
2,311
2,734
138
2,595
(84,160)
9,860
4,259
14,119(98,280)−11−（Millions of yen）
For the six months
ended
Sep. 30, 201957,13344,814
44,143
428
4,209
2,216
5,892
37,744
796
610
7,968
58
21,994
6,928
19,388
12
12
226
223
2
19,174
6,887(3,352)
3,535
15,638

Suruga bank, Ltd.

(3) Non-consolidated statements of changes in net assets
For the six months ended September 30, 2018
（Millions of yen）
Shareholders' equity
Capital surplus

Balance at beginning ofcurrent period
Changes of items during
periodCapital stock

Legal capitalsurplus

Other capitalsurplus30,043

18,585

4

Retained earnings
Other retained earnings
Reserve for
Total capital Legal retained advanced
surplusearnings
depreciationof non-current
assets
18,59030,04359

Retainedearnings
brought
forwardGeneralreserve

103,032

133,955

Dividends of surplus(2,432)

Net income(98,280)

Purchase of treasury
shares
Disposal of treasury
shares

(0)

(0)

(0)

(0)

3

18,589Net changes of items otherthan shareholders' equity

Total changes of items
during period
Balance at end of current
period30,043

18,585

Shareholders' equity
Retainedearnings
Total retained
earnings
Balance at beginning ofcurrent period
Changes of items during
period267,090

Treasuryshares

(582)

-

-

30,043

59

103,032(100,712)
33,243

Valuation and translation adjustments

Net unrealized
Subscription
Total
gains (losses) Deferred gains
Totalrights tovaluation andshareholders' on available- (losses) on
sharestranslation
hedgesequityfor-saleadjustments
securities
315,141

17,563(10)

17,552

17

Total net
assets332,711

Dividends of surplus(2,432)(2,432)(2,432)

Net income(98,280)(98,280)(98,280)

(0)

(0)

(0)

23

22

22

Purchase of treasury
shares
Disposal of treasury
sharesNet changes of items otherthan shareholders' equity

Total changes of items
during period
Balance at end of current
period(2,779)19(2,760)(5)(2,765)(100,712)

22(100,690)(2,779)19(2,760)(5)(103,456)

166,378(560)

214,450

14,784

8

14,792

12229,255−12−

Suruga bank, Ltd.

For the six months ended September 30, 2019
（Millions of yen）
Shareholders' equity
Capital surplus

Balance at beginning ofcurrent period
Changes of items during
periodCapital stock

Legal capitalsurplus

Other capitalsurplus30,043

18,585

3

Retained earnings
Other retained earnings
Reserve for
Total capital Legal retained advanced
surplusearnings
depreciationof non-current
assets
18,58930,04359

Retainedearnings
brought
forwardGeneralreserve

103,032

34,506

Dividends of surplus
Net income

15,638Purchase of treasury
shares
Disposal of treasury
shares

(0)

(0)

(0)

(0)

3

18,589Net changes of items otherthan shareholders' equity

Total changes of items
during period
Balance at end of current
period30,043

18,585

Shareholders' equity
Retainedearnings
Total retained
earnings
Balance at beginning ofcurrent period
Changes of items during
period167,641--

30,043

59

103,032

50,145

Valuation and translation adjustments

Net unrealized
Subscription
Total
gains (losses) Deferred gains
Totalrights tovaluation andshareholders' on available- (losses) on
sharestranslation
hedgesequityfor-saleadjustments
securities

Treasuryshares(560)

15,638215,714

12,250(29)

12,221

Total net
assets12

227,947

Dividends of surplus
Net income

15,638Purchase of treasury
shares
Disposal of treasury
shares

15,63815,638

(0)

(0)

(0)

0

0

0

Net changes of items otherthan shareholders' equity

Total changes of items
during period
Balance at end of current
period(4,491)

2(4,489)(12)(4,501)

15,638(0)

15,638(4,491)

2(4,489)(12)

11,136

183,280(560)

231,352

7,759

(27)

7,731

-

239,084−13−

Financial Results
For the six months ended September 30, 2019

- Supplementary Information -SURUGA bank, Ltd.

Table of contents
Ⅰ. Financial highlights for the six months ended September 30, 2019
1. Financial results

Non-consolidated

・・・・・・・・

2. Major accounts

Non-consolidated

・・・・・・・・

3. Management indicesNon-consolidated

・・・・・・・・

4. Own capital

Non-consolidated

・・・・・・・・

5. Unrealized gains (losses) on securities

Non-consolidated

・・・・・・・・

6. Earnings forecast for the fiscal year ending March 31, 2020

1
3
7
8
9

Non-consolidated, Consolidated

7. Asset quality

Non-consolidated

・・・・・・・・

8. Credit costs

Non-consolidated

・・・・・・・・

10
11

9. Dividends

Non-consolidated

・・・・・・・・・・・・・・・・

12
13

・・・・・・・・

14

15
16

Ⅱ. Financial data for the six months ended September 30, 2019
1. Details of financial results

Non-consolidated
Consolidated

2. Net operating profit

Non-consolidated

3. Interest margins

Non-consolidated

4. ROA and ROE

Non-consolidated

5. Gains (losses) on securities

Non-consolidated

6. Capital adequacy ratio (domestic standard)

Non-consolidated, Consolidated

・・・・・・・・

7. Composition of own capital (domestic standard)

Non-consolidated, Consolidated

・・・・・・・・

Non-consolidated

・・・・・・・・

1. Risk-monitored loans

Non-consolidated, Consolidated

・・・・・・・・

2. Allowance ratio for risk-monitored loans

Non-consolidated, Consolidated

・・・・・・・・

17
18
19

3. Allowance for loan losses

Non-consolidated, Consolidated

・・・・・・・・

20

・・・・・・・・

21

Non-consolidated, Consolidated

・・・・・・・・

22

Non-consolidated, Consolidated

・・・・・・・・

22

Ⅲ. Status of Loans, etc.
Comparison of asset disclosure by standard

4. Non-performing loans based on the Financial Reconstruction Law
5. Status of coverage of non-performing loans based on
the Financial Reconstruction Law

Non-consolidated
Non-consolidated

6. Loan breakdown by industry, etc.
(1) Loan breakdown by industry

Non-consolidated(2) Breakdown of risk-monitored loans by industry

Non-consolidated(3) Consumer loans

Non-consolidated(4) The ratio of loans to small- and medium-sized enterprises, etc.

Non-consolidated

7. Loan breakdown by country(1) Loans to specific foreign countries

Non-consolidated(2) Loans to Asian countries

Non-consolidated

8. Deposits and loans

Non-consolidated

9. Number of branches

Non-consolidated

Ⅳ. Unrealized gains (losses) on securities
1. Unrealized gains (losses)
Ⅴ. Retirement benefits
1. Retirement benefit expenses

Suruga bank, Ltd.

Ⅰ. Financial highlights for the six months ended September 30, 2019
1. Financial results (Non-consolidated)
Six months ended
Sep. 30, 2019(a)
42,41844,018(3,758)2,003
42,264
22,43919,824
19,824
154
19,9791,639
18,340
5,046
290
5,270
19,388－(223)
215,638Gross operating profit
Net interest income
Net fees and commissions
Net other operating income (Note1）
Core gross operating profit
Expenses (-)
Core net operating profit （Note2）
Excluding gains (loss) on cancellation of investment trusts
Gains (losses) on bonds
Actual net operating profit (Note3）
Provision for general allowance for loan losses (-)
Net operating profit
Disposal of non-performing loans (-)
Recoveries of written-off claims
Gains (losses) on stocks
Ordinary profit
Reversal of provision for directors’ retirement benefits
Gains (losses) on disposal of non-current assets
Impairment loss (-)
Net income(a) - (b)(11,556)(11,559)(1,643)
1,977(11,224)(1,380)(9,844)(9,540)(332)(10,176)(25,191)
15,016(88,308)(258)(66)
103,125(2,311)(85)(2,593)113,918(Millions of yen)Six months ended
Sep. 30, 2018(b)
53,97455,577(2,115)26
53,48823,81929,66829,364486
30,155
26,8303,324
93,354
548
5,336(83,737)
2,311
(138)
2,595
(98,280)

Net credit costs
6,685(113,500)
120,185
Actual credit costs（Note4）
6,394(113,242)
119,636(Note1) Excludes 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) Actual credit costs = Net credit costs (Provision for general allowance for loan losses + Disposal of non-performing loans)- Recoveries of written-off claims(1) Gross operating profit: ¥42.4 billion
・Net interest income decreased by ¥11.5 billion year-on-year, mainly due to a decrease in interest on
loans and bills discounted.
・Loan-deposit income decreased by ¥8.4 billion year-on-year.
・Core gross operating profit decreased by ¥11.2 billion year-on-year, mainly due to a decrease in net interest income.
・Gross operating profit decreased by ¥11.5 billion year-on-year.

Net interest income

Loan-deposit income(Billions of yen)
53.7

1H,
FY3/1654.8

1H,
FY3/17(Billions of yen)
58.3

1H,
FY3/1855.5

1H,
FY3/19

44.0

50.2

1H,
FY3/201H,
FY3/16

53.8

55.9

51.9
43.5

−1−

1H,
FY3/171H,
FY3/181H,
FY3/191H,
FY3/20Suruga bank, Ltd.

(2) Expenses; OHR: 52.8%
・Expenses decreased by ¥1.3 billion year-on-year.
・OHR rose year-on-year to 52.8%, 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%

53.0

54.0

44.7%

57.0

41.7%

53.9

52.8%

44.1%
42.4

23.1

24.1

23.8

23.8

22.4

1H,FY3/16

1H,FY3/17

1H,FY3/18

1H,FY3/19

1H,FY3/20(3) Core net operating profit: ¥19.8 billion, Net operating profit: ¥18.3 billion
・Core net operating profit decreased by ¥9.8 billion year-on-year, mainly due to a decrease in net interest income.
・Net operating profit increased by ¥15.0 billion year-on-year, mainly due to an decrease in provision for general allowance
for loan losses.

Core net operating profit

Net operating profit(Billions of yen)

29.0 29.8

1H,FY3/16

29.8 30.0

1H,FY3/17

33.0 33.1

1H,FY3/18

29.6
3.3

19.8 18.3

1H,FY3/19

1H,FY3/20(4) Ordinary profit: ¥19.3 billion
・Ordinary profit increased by ¥103.1 billion year-on-year, mainly due to a decrease in net credit costs.

(5) Net income: ¥15.6 billion
・Net income increased by ¥113.9 billion year-on-year, mainly due to an increase in ordinary profit.

(6) Actual credit costs: ¥6.3 billion
・Net credit costs decreased by ¥113.5 billion year-on-year, mainly due to a decrease (¥25.1 billion) in provision forgeneral allowance for loan losses and a decrease (¥88.3 billion) in disposal of non-performing loans.
・Actual credit costs, calculated as net credit costs (¥6.6 billion) minus the amount of recoveries of written-off claims(¥0.2 billion) amounted to ¥6.3 billion.

−2−

Suruga bank, Ltd.

2. Major accounts (Non-consolidated)(1) Loans and bills discounted
・Loans and bills discounted decreased by ¥227.2 billion, or 7.8% from March 31, 2019.
・Consumer loans decreased by ¥209.4 billion, or 7.8% from March 31, 2019.
・Yield on loans and bills discounted (overall) dropped by 11 basis points from March 31, 2019 to 3.21%.
(Billions of yen)

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

Sep.30,2019(a)(a)-(b)Jun.30,2019(b)(b)-(c)Mar.31
2019(c)(c)-(d)Dec.31
2019(d)(d)-(e)Sep.30,2018(e)2,671.6(54.6)

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

2,968.7(117.1)

3,085.8

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
2,477.9
248.1(64.7)(55.4)(9.4)

2,790.8
2,533.3
257.5（Reference）
Six months ended
Sep. 30, 2019(a)

New consumer loans

2.7(a) - (b)(Billions of yen)Six months ended
Sep. 30, 2018(b)(25.4)

28.1(Billions of yen)
Loans and bills discounted(period-end balance)
Consumer loans(period-end balance)

Yield on loans and bills discounted(overall)

3,085.8
2,968.7
2,898.8
2,726.2
2,671.6
2,790.8
2,726.1
2,664.8
2,508.7
2,455.4

Sep.18

Dec.18Mar.19Jun.19Sep.19

3.36%

3.35%

3.32%

3.19%

3.21%

Sep.18

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

−3−Suruga bank, Ltd.

Consumer loans
Outstanding balance, yield, delinquency rate by loan category
Sep. 30, 2019

(Billions of yen)

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

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%

Jun. 30, 2019
Period-end
Yield
Delinquency
balancerate
2,276.8
3.21%
4.55%
600.7
2.88%
0.32%
220.0
3.43%
1.03%

1,193.0

3.41%

2.38%

1,209.5

3.45%

1.85%

199.2
44.3
223.8
147.6
76.2

1.83%
4.89%
10.16%
11.45%
7.66%

40.66%
0.91%
1.69%
0.69%
3.63%

200.5
46.0
231.8
152.2
79.5

1.89%
4.87%
10.12%
11.40%
7.66%

39.93%
0.61%
1.64%
0.71%
3.41%

2,455.4

3.79%

4.74%

2,508.7

3.82%

4.29%

(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.

Share house loans (Non-performing loans based on the Financial Reconstruction Law)
(Billions of yen)Total
creditbalanceSep. 30, 2018
Dec. 31, 2018
Mar. 31, 2019
Jun. 30, 2019
Sep. 30, 2019

253.7
251.5
250.3
248.0
246.1

Claims against
bankrupt andsubstantiallybankrupt obligors
31.8
69.5
86.5
88.3
89.9

Total credit balanceA

Share houseclaims
203.4
202.2
201.9
200.6
199.3

Claims withcollection risk

Claims for
specialattention

101.6
65.0
51.0
45.0
41.1

56.8
76.2
88.0
93.4
97.7

Collateral or
guarantees, etc.

UnsecuredportionB

C

Subtotal(Non-perfor
ming loans)

Normalassets

190.3
63.4
210.9
40.5
225.6
24.6
226.8
21.2
228.8
17.3
(Billions of yen)
Coverage
Allowance
ratio

D(B + D) / A

Sep. 30, 2018
253.7
95.2
158.4
136.2
91.25%
Dec. 31, 2018
251.5
94.9
156.5
136.9
92.21%
Mar. 31, 2019
250.3
91.4
158.8
139.3
92.20%
Jun. 30, 2019
248.0
91.0
157.0
137.3
92.05%
Sep. 30, 2019
246.1
90.6
155.5
135.1
91.74%(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.
−4−Suruga bank, Ltd.

Actual credit costs and Allowance for loan losses

Sep. 30, 2019

(Billions of yen)
Item

Actual credit costs

Allowance

Share house-related loans

(2.8)

135.1

Investment property loans ※1

8.1

46.9

Housing loans

0.3

2.0

Unsecured loans

0.1

0.8

0

13.4

Business financing other than loans to founder-affiliated companies

0.5

3.7

Total

6.3

202.3

Loans to founder-affiliated companies(Note1)Investment property loans: Studio apartment loans, Single building apartment loans, Other secured loans−5−Suruga bank, Ltd.

(2) Deposits
・Deposits decreased by ¥0.7 billion from March 31, 2019.
・Individual deposits decreased by ¥49.6 billion, or 1.9% from March 31, 2019.
・Yield on deposits (overall) dropped by 1 basis points from March 31, 2019 to 0.03%.
(Billions of yen)
Sep.30,2019(a)(a)-(b)Jun.30,2019(b)Loans and bills discounted(period-end balance)
Consumer loans(b)-(c)Mar.31,
2019(c)

3,164.9

23.1

2,456.1(20.8)(c)-(d)Dec.31,
2018(d)(d)-(e)Sep.30,2018(e)3,141.8(23.8)

3,165.6(63.0)

3,228.6(187.3)

3,415.9

2,476.9(28.8)

2,505.7(83.0)

2,588.7(154.6)

2,743.3

Deposits(period-end balance)(Billions of yen)
3,415.9

3,228.6

2,743.3

Sep.18

Yield on deposits(overall)

Individual deposits(period-end balance)

3,165.6

2,588.7

Dec.183,141.8

2,505.7

Mar.193,164.9
2,456.1

2,476.9

Jun.19Sep.19

0.05%

0.05%

0.04%

0.03%

0.03%

Sep.18

Dec.18Mar.19Jun.19Sep.19(Note)Based on cumulative period.
(3) Net fees and commissions
・Net fees and commissions decreased by ¥1.6 billion year-on-year, mainly due to a decrease (¥0.8 billion)in fees and commissions, an increase (¥0.8 billion) in fee and commissions payments.

Net fees and commissions(Millions of yen)

7,487
6,130

5,954

(1,533)

1H,FY3/16

Fees and commissions
7,392

7,019

(889)

1H,FY3/17

Fees and commissions payments

5,871

5,038

(2,115)(1,521)

1H,FY3/18

−6−

7,968

7,154

1H,FY3/19

4,209(3,758)

1H,FY3/20

Suruga bank, Ltd.

(4) Individual deposit assets
・Individual deposit assets decreased by ¥55.9 billion from March 31, 2019.
・The ratio of investment products to total individual deposit assets dropped by 10 basis points from March 31, 2019 to 4.9%.
(Millions of yen)Sep. 30, 2019(a)Mar. 31, 2019(b)

Sep. 30, 2018(c)

2,635,272

2,888,761(286,332)

2,501,642

2,738,473(23,074)

133,630

150,288

(129)

(865)

4,108

4,844

7,883

(420)

(574)

8,303

8,457

Mutual funds

76,763(3,674)(11,365)

80,437

88,128Personal pension plans

23,395(2,007)(9,984)25,40233,37915,192

(184)

(285)

15,376

15,4774.9%(0.1%)(0.3%)

5.0%

5.2%

2,579,355(a) - (b)(55,917)(a) - (c)(309,406)

2,452,141(49,501)

127,214(6,416)

Foreign currency deposits

3,979

Public bonds

Individual deposit assets
Yen deposits
Investment products

Single premium life insurance
The ratio of investment products tototal individual deposit assets

3. Management indices (Non-consolidated)(1) Interest margins
・Loan-deposit margin (after deduction of expenses) shrunk by 34 basis points year-on-year to 1.72%.
・Net interest margin shrunk by 30 basis points year-on-year to 1.21%, mainly due to the decline
in yield on interest earning assets.

(0.14)(%)
Six months ended
Sep. 30, 2018
(b)
3.31

1.72

(0.34)

2.06

1.21(0.30)

1.51

Six months ended
Sep. 30, 2019
(a)
3.17

Loan-deposit margin
Loan-deposit margin(after deduction of expenses)
Net interest margin(a) - (b)Loan-deposit margin
Loan-deposit margin (after deduction of expenses)
Net interest margin

3.41%

3.49%

2.25%

2.29%

3.48%
2.31%

3.31%

3.17%

2.06%
1.72%

1.44%

1.42%

1H, FY3/16

1H, FY3/17

1.62%

1H, FY3/18

−7−

1.51%

1H, FY3/19

1.21%
1H, FY3/20

Suruga bank, Ltd.

4. Own capital (Non-consolidated)・Capital adequacy ratio rose by 58 basis points from June 30, 2019 to 9.23%.

Non-consolidated(Millions of yen)Sep 30, 2019
9.23%
228,920
259,72330,802
2,479,648
95,777

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

Jun 30, 2019
8.65%
219,081248,11029,0292,531,616
98,064(Millions of yen)Sep 30, 2019
9.33%
235,739
272,539
36,8002,524,020
97,552

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

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

8.65%

9.05%

8.80%

8.65%

9.23%

219.7

223.6

213.7

219.0

228.9

Sep.18

Dec.18Mar.19Jun.19Sep.19−8−

Jun 30, 20198.76%
225,803
261,152
35,3492,575,073
99,802

Suruga bank, Ltd.

5. Unrealized gains (losses) on securities (Non-consolidated)
・Net unrealized gains on securities decreased by ¥6.5 billion from March 31, 2019, mainly due to an elimination of crossshareholdings.
(Millions of yen)

Other securities
Stocks
Bonds
OthersSep. 30, 2019(a)
10,732
9,301
703
727

(a) - (b)(6,522)(6,610)4544(a) - (c)(10,195)(11,182)947
40

Mar. 31, 2019(b)
17,254
15,911658
683

Sep. 30, 2018(c)
20,927
20,483(244)
687

6. Earnings forecast for the fiscal year ending March 31, 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
Actual credit costs(Millions of yen)
Fiscal year ending
Mar. 31, 2020
(forecast)
116,500
23,00015,500(Millions of yen)
Fiscal year ending
Mar. 31, 2020
(forecast)
103,000
36,00033,00022,00015,00019,000(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 not intended to guarantee
future performance. Actual performance may differ materially depending on various factors.

−9−Suruga bank, Ltd.

7. Asset quality (Non-consolidated)(1) Non-performing loans based on the Financial Reconstruction Law
・Non-performing loans based on the Financial Reconstruction Law increased by ¥29.0 billion from March 31, 2019.
Non-performing loan ratio rose by 215 basis points from March 31, 2019 to 14.83%.
Outstanding balance(Millions of yen, %)Sep. 30, 2019(a)(a) - (b)(a) - (c)Mar. 31, 2019(b)

Sep. 30, 2018(c)

Claims against bankrupt andsubstantially bankrupt obligors

142,337

33,946

96,971

108,391

45,366Claims with collection risk

99,212(37,265)(54,667)

136,477

153,879

Claims for special attention

157,494

32,39581,648125,099

75,846

Total(A)

399,044

29,076

123,952

369,968

275,092

Total claims(B)

2,689,103(227,846)(415,600)

2,916,949

3,104,703

(A/B)

14.83

2.15

5.97

12.68

8.86

Non-performing loan ratio
Status of coverage(Millions of yen, %)Claims against
bankrupt andsubstantiallybankrupt
obligors

Claims withcollection risk

Claims for
specialattention

Total

Change from
Sep. 30, 2018

Non-performing loans(A)

142,337

99,212

157,494

399,044

123,952

Covered amount (C+D)(B)

142,337

82,414

102,751

327,503

88,039Portion secured by collateralor guarantees, etc.

(C)55,92150,37447,466

153,763

52,433

Allowance for loan losses(D)

86,41632,03955,284

173,740

35,607100.00

83.06

65.24

82.07

(4.97)(E)

86,416

48,838110,027

245,281

71,519Allowance ratio for unsecured portion(D/E)

100.00

65.60

50.24

70.83

(8.66)

67,86267,01887,408222,289

100.00

75.51

57.51

75.91

Coverage ratio (B/A)
Unsecured portion (A-C)(Reference) As of Mar. 31, 2019
Unsecured portion
Allowance ratio for unsecured portion(2) Risk-monitored loans(Millions of yen, %)Sep.30,2019(a)(a) – (b)(a) – (c)Mar.31,2019(b)

Sep.30,2018(c)Loans to bankrupt obligors

2,957(1,775)

295

4,732

2,662

Non-accrual delinquent loans

238,539(1,525)42,016240,064

196,523

9,202

4,132

6,574

5,070

2,628

Restructured loans

148,292

28,26375,074

120,029

73,218

Total

398,991

29,094

123,959

369,897

275,032

82.06(3.46)(4.98)

85.52

87.04

Loans past due 3 months or more

Coverage ratio−10−Suruga bank, Ltd.

8. Credit costs (Non-consolidated)
Six months ended
Sep. 30, 2019(a)(Millions of yen, %)Six months ended
Sep. 30, 2018(b)(a) - (b)Provision for general allowance for loan losses

(1)

1,639

(25,191)

26.830

Disposal of non-performing loans

(2)

5,046

(88,308)

93.354369(1,606)

1.975

4,281

(86,100)

90,381

Losses on sales of delinquent loans

400

(622)

1,022

Provision for allowance for contingent losses

(5)

19

(24)

A

290

(258)

548

(3) (=(1)+(2))

6,685(113,500)

120,185(3)- A

6,394(113,242)

119,636

2,739,369(395,516)

3,134,885

Net credit costs ratio

0.48(7.16)

7.64

Actual credit costs ratio

0.46(7.15)

7.61

Write-off of loans
Provision for specific allowance for loan losses

Recoveries of written-off claims
Net credit costs
Actual credit costs
Loans and bills discounted (average balance)(Note1) Net credit costs ratio = Net credit costs / The average balance of Loans and bills discounted (annualized)(Note2) Actual credit costs ratio = Actual credit costs / The average balance of Loans and bills discounted (annualized)

9. Dividends
・In consideration of capital loss due to losses posted in the previous fiscal year, the company has regretfully decided to not
pay an interim dividends in order to strengthen its financial structure and internal reserves.
・The forecast for fiscal year-end dividends remains undecided at this time. It will be determined after comprehensive
consideration of the annual financial results and adequacy of internal reserves.

Fiscal year ending
Mar. 31, 2020(a)Annual dividend per share
Interim dividend(yen)Fiscal year ended
Mar. 31, 2019(result)(b)－(not decided)

0.00

0.00

0.00

(Note) Annual dividend per share for the fiscal year ending March 31, 2020 is a forecast.

−11−Suruga bank, Ltd.

Ⅱ. Financial data for the six months ended September 30, 2019
1. Details of financial results (Non-consolidated)
Six months ended
Sep. 30, 2019(a)
42,418（42,26442,280（42,12643,908(3,769)
2,142
（
154
138
（
138
110
11
16
（
22,4397,434
12,986
2,018
19,97919,824Gross operating profit(excluding gains (losses) on bonds)
Domestic gross operating profit(excluding gains (losses) on bonds)
Net interest income
Net fees and commissions
Net other operating income(of which, Gains (losses) on bonds)
International gross operating profit(excluding gains (losses) on bonds)
Net interest income
Net fees and commissions
Net other operating income(of which, Gains (losses) on bonds)
Expenses (excluding non-recurring losses)
Personnel expenses
Non-personnel expenses
Taxes
Actual net operating profit
Core net operating profit
Excluding gains (loss) on cancellation of
investment trust
Provision for general allowance for loan losses
Net operating profit
Gains (losses) on bonds
Non-recurring gains (losses)
Recoveries of written-off claims
Gains (losses) on stocks
Ordinary profit
Extraordinary gains (losses)
Gains (losses) on disposal of non-current assets
Impairment loss (-)
Reversal provision for directors' retirement benefits
Income before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
Net income(1)Provision for general allowance for loan losses(2)Disposal of non-performing loans
Write-off of loans
Provision for specific allowance for loan losses
Losses on sales of delinquent loans
Provision for allowance for contingent losses(3)Net credit costs (1)+(2)(4)Recoveries of written-off claims(5)Actual credit costs (3)-(4)−12−(a) - (b)(11,556)(11,224)(11,519)(11,187)(11,533)(1,640)
1,655
(332)
(37)
(37)
(26)
(2)
(9)
(1,380)(1,144)(201)(35)(10,176)(9,844)(Millions of yen)Six months ended
Sep. 30, 2018(b)
53,97453,488 ）53,79953,313 ）55,441(2,129)
487
486 ）
175
175 ）
136
13
25
- ）
23,8198,578
13,187
2,053
30,15529,66819,824(9,540)29,364

1,639
18,340
154
1,048
290
5,270
19,388
(214)
(223)
2
19,174
6,887(3,352)
3,535
15,638(25,191)
15,016(332)
88,109(258)(66)
103,125208(85)(2,593)(2,311)
103,334(2,973)(7,611)(10,584)
113,918

26,8303,324
486(87,061)
548
5,336(83,737)
(422)
(138)
2,595
2,311
(84,160)
9,860
4,259
14,119(98,280)

1,639
5,046
369
4,281
400
(5)
6,685
290
6,394

(25,191)(88,308)(1,606)(86,100)(622)
19(113,500)(258)(113,242)

26,83093,354
1,975
90,3811,022(24)
120,185548
119,636

Suruga bank, Ltd.

Details of financial results (Consolidated)
Six months ended
Sep. 30, 2019(a)
47,60247,781(2,626)2,446
24,830
8,520
5,316
1
530
20,099(206)
19,892
7,171(3,269)3,902
1715,972

Consolidated gross profit
Net interest income
Net fees and commissions
Net other operating income
Expenses (excluding non-recurring losses)
Actual credit costs
Gains (losses) on stocks
Equity in gains (losses) of affiliates
OthersOrdinary profit
Extraordinary gains (losses)
Income before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
Profit attributable to non-controlling interests
Profit attributable to owners of parent(a) - (b)(9,405)(9,546)(1,561)
1,701(1,348)(115,581)(1,821)
4
118
105,825
221
106,045(2,961)(7,820)(10,782)69
116,757(Millions of yen)Six months ended
Sep. 30, 2018(b)
57,00757,327(1,065)745
26,178124,101
7,137
(3)
412
(85,726)(427)(86,153)
10,132
4,551
14,684(52)(100,785)(1)Provision for general allowance for loan losses
1,580(25,689)
27,269(2)Disposal of non-performing loans
7,466(90,144)
97,610
Write-off of loans
1,096(1,852)
2,948
Provision for specific allowance for loan losses
5,173(87,874)
93,047
Losses on sales of delinquent loans
1,202
(437)
1,639
Provision for allowance for contingent losses
(5)
19
(24)
(3)Net credit costs (1)+(2)9,046(115,833)
124,879(4)Recoveries of written-off claims
526
(251)
777
(5)Actual credit costs (3)-(4)8,520(115,581)
124,101(Note) Consolidated gross profit = (Interest income - Interest expenses) + (Fees and commissions - Fees and commissions
payments) + (Other operating income - Other operating expenses)(Reference)(Millions of yen)
17,632
3,559
Consolidated net operating profit
21,191(Note) Consolidated net operating profit = Consolidated gross profit - Consolidated expenses - Consolidated provision for generalallowance for loan losses(Number of consolidated subsidiaries and affiliates)
Consolidated subsidiaries
Equity-method accounted affiliates-(Companies)
91

15,016
9,957(Millions of yen)Six months ended
Sep. 30, 2018
(b)
3,324
2,164

9
1

2. Net operating profit (Non-consolidated)
Six months ended
Sep. 30, 2019(a)
18,34012,121

Net operating profit
Per employee (Thousands of yen)

−13−(a) - (b)Suruga bank, Ltd.

3. Interest margins (Non-consolidated)
Overall

Yield on interest earning assets(A)
Yield on loans and bills discounted
Yield on securities
Yield on interest bearing liabilities(B)
Yield on deposits
Loan-deposit margin(after deduction of expenses)
Net interest margin(A) - (B)

(0.11)(0.15)(4.69)
0.19(0.02)(%)
Six months ended
Sep. 30, 2018
(b)
2.82
3.36
5.37
1.31
0.05

1.72

(0.34)

2.06

1.21(0.30)

1.51(0.11)(0.15)(4.83)
0.18(0.02)(%)
Six months ended
Sep. 30, 2018
(b)
2.81
3.36
5.52
1.26
0.05

1.76

(0.33)

2.09

1.25(0.30)

1.55

0.95
5.64
14.88
75.55

(%)
Six months ended
Sep. 30, 2018(b)
0.15
(4.71)
2.06(61.10)

(332)
6
(312)
27
-

(Millions of yen)Six months ended
Sep. 30, 2018
(b)
486
517
30
-

(66)
(1,714)117(1,765)

5,336
7,153
1,817

Six months ended
Sep. 30, 2019
(a)
2.71
3.21
0.68
1.50
0.03

(a) - (b)Domestic

Yield on interest earning assets(A)
Yield on loans and bills discounted
Yield on securities
Yield on interest bearing liabilities(B)
Yield on deposits
Loan-deposit margin(after deduction of expenses)
Net interest margin(A) - (B)Six months ended
Sep. 30, 2019
(a)
2.70
3.21
0.69
1.44
0.03

(a) - (b)4. ROA and ROE (Non-consolidated)

ROA
ROE

Net operating profit basis
Net income basis
Net operating profit basis
Net income basis

Six months ended
Sep. 30, 2019
(a)
1.10
0.93
16.94
14.45

(a) - (b)5. Gains (losses) on securities (Non-consolidated)

Gains (losses) on bonds
Gains on sales
Gains on redemptions
Losses on sales
Losses on redemptions
Losses on devaluation

Six months ended
Sep. 30, 2019
(a)
154
6
205
57
-

Gains (losses) on stocks
Gains on sales
Losses on sales
Losses on devaluation

5,270
5,439
117
52

−14−

(a) - (b)Suruga bank, Ltd.

6. 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(Millions of yen)Sep. 30, 2019
(a)
9.23%
228,920
259,72330,802
2,479,648
95,777(a) - (b)0.43%
15,124
16,365
1,241
52,597(1,305)

Consolidated

Capital adequacy ratio
Own capital (Core capital)
Core capital : instruments and reserves
Core capital : regulatory adjustments (-)
Risk-weighted assets
Total required capitalMar. 31, 2019
(b)
8.80%
213,796
243,358
29,561
2,427,051
97,082(Millions of yen)Sep. 30, 2019
(a)
9.33%
235,739
272,539
36,8002,524,020
97,552−15−(a) - (c)0.43%
15,73816,409671
53,140(1,283)Mar. 31, 2019
(b)
8.90%
220,001
256,130
36,1292,470,880
98,835

Suruga bank, Ltd.

7. Composition of own capital (domestic standard)(Millions of yen）
September 30, 2019Non-consolidatedCore 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 andreserves
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 those relating tomortgage 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
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 sharecapital (amount above the 10% threshold)Amount exceeding the 10% threshold on specified items
Significant investments in the common stock of Other financial institutions, netof 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 transitionalarrangements
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)

−16−

Consolidated

231,352

239,92148,632
183,280560-

31,245
209,236
560
3,444
3,444

-

-

28,37028,37028,511
28,511

-

-

-

-

-

-

-

-

-

662

259,723

272,539

14,682

16,506

14,682

1,618
14,888

-

233

26
7,700
-

26
11,145
-

-

-

-

-

8,392

8,887

-

-

8,392
30,8028,887
36,800228,920

235,7392,269,651

2,280,930

209,9972,479,648

243,0902,524,020

9.23%

-

-

9.33%

Suruga bank, Ltd.

Ⅲ. Status of loans, etc.
Comparison of asset disclosure by standard
Non-consolidated (As of September 30, 2019)
Classification and status of coverage by disclosure standard
Self-assessment result(by obligor classification)* Includes total claims (“Claims for special
attention” includes only loans and bills
discounted).

* Includes total claims.

Classification

Category
Creditbalance

Nonclassification

Category

Classification
Ⅱ

Classification
Ⅲ

Classification
Ⅳ

1,930

-

[1,035]Bankrupt obligors
2,965[1,035]
Effectively bankrupt
obligors

1,035

94,87344,498-139,372[85,380][85,380]

Potentiallybankrupt obligors
39,59842,815

99,212[32,039]

Substandard
obligors
Obligors
requiring
cautionNon-performing loans based on
the Financial Reconstruction Law

16,798[32,039]-

Creditbalance
Claimsagainstbankrupt
andsubstantiallybankrupt
obligors

CollateralorAllowance
guarantees,etc.

55,921

86,416* Includes loans andbills discounted.

Coverage
ratio

50,37432,03983.06%

99,212Claims for
specialattention
244

185,951--

47,46655,284

Category

Outstandingbalance

Loans tobankrupt
obligors

2,957

Non-accrualdelinquentloans

238,539

Loans pastdue 3 months
or more9,202

Restructured
loans

148,292

Total

398,991100%

142,337

Claims withcollection
risk(Millions of yen)
Risk-monitoredloans

65.24%

157,494
Subtotal

186,196

153,763

173,740

82.07%

399,044

Other
obligors
requiring
caution

11,701

1,033,247--

1,044,949
Normal obligors

Normalassets2,290,058

1,216,407---

1,363,860

1,308,444

16,798[32,039][86,416]

1,216,407
Total
2,689,103[118,455]

Total
2,689,103(Note1) “Total claims” includes “Loans and bills discounted”, “Customers’ liabilities for acceptances and guarantees”, “Foreignexchanges”, “Securities lent”, “Suspense payment” and “Accrued interest”.
(Note2) Numbers shown in brackets under “Self-assessment result” represent the reserved amount for each category.

−17−

Suruga bank, Ltd.

1. Risk-monitored loans
The following table shows figures after partial direct write-off of loans.
The amounts of partial direct write-off of loans for the six months ended September 30, 2019 were as follows:(a) Non-consolidated: ¥3,960 million; (b) Consolidated: ¥4,705 million
Loans to “Potentially bankrupt obligors”, “Effectively bankrupt obligors” and “Bankrupt obligors” under self-assessment areplaced on non-accrual status.
Non-consolidated

Loans to bankrupt obligors
Non-accrual delinquent loans

Riskmonitored Loans past due 3 months or moreloans
Restructured loans
Total
Loans and bills discounted(period-end balance)
Loans to bankrupt obligors％ to loans Non-accrual delinquent loans
and bills Loans past due 3 months or morediscounted Restructured loans
Total(Millions of yen, %)Sep. 30, 2019
(a)
2,957
238,5399,202
148,292
398,991(a) - (b)(1,775)(1,525)
4,132
28,26329,094(a) - (c)295
42,016
6,574
75,074
123,959

Mar. 31, 2019
(b)
4,732
240,064
5,070
120,029
369,897

Sep. 30, 2018
(c)
2,662
196,523
2,628
73,218275,032

2,671,642(227,222)(414,232)

2,898,864

3,085,874

0.11
8.92
0.34
5.55
14.93

(0.05)
0.64
0.17
1.41
2.17

0.03
2.56
0.26
3.18
6.02

0.16
8.28
0.17
4.14
12.76

0.08
6.36
0.08
2.37
8.91

Consolidated

Loans to bankrupt obligors
Non-accrual delinquent loans
Riskmonitored Loans past due 3 months or moreloans
Restructured loans
Total
Loans and bills discounted(period-end balance)
Loans to bankrupt obligors％ to loans Non-accrual delinquent loans
and bills Loans past due 3 months or morediscounted Restructured loans
Total(Millions of yen, %)Sep. 30, 2019
(a)
3,765
246,380
9,202
148,292
407,640(a) - (b)(2,673)74
4,132
28,26329,796(a) - (c)(299)
43,584
6,574
75,074
124,933

Mar. 31, 2019
(b)
6,438
246,306
5,070
120,029
377,844

Sep. 30, 2018
(c)
4,064
202,796
2,628
73,218282,7072,677,686(226,701)(413,299)

2,904,387

3,090,985

0.14
9.20
0.34
5.53
15.22

(0.08)
0.72
0.17
1.40
2.22

0.01
2.64
0.26
3.17
6.08

0.22
8.48
0.17
4.13
13.00

0.13
6.56
0.08
2.36
9.14

−18−

Suruga bank, Ltd.

2. Allowance ratio for risk-monitored loans
Non-Consolidated

Risk-monitored loans(A)
Collateral or guarantees, etc.
(B)
Allowance for loan losses(C)
Allowance ratio(C/A)
Coverage ratio(B+C)/(A)Sep. 30, 2019(a)
398,991
153,743
173,706
43.53
82.06

(a) - (b)29,0946,083
5,012(2.07)(3.46)(a) - (c)123,959
52,42235,624(6.67)(4.98)(Millions of yen, %)Mar. 31, 2019
Sep. 30, 2018(b)(c)
275,032
369,897
101,321
147,660
138,082
168,694
50.20
45.60
87.04
85.52

(a) - (c)124,933
52,11436,816(6.32)(4.82)(Millions of yen, %)Mar. 31, 2019
Sep. 30, 2018(b)(c)
282,707377,844
104,059
150,421
141,589
172,445
50.08
45.63
86.89
85.44

(a) - (c)16,247
1,519
14,729(Millions of yen)Mar. 31, 2019
Sep. 30, 2018(b)(c)
186,095
200,708
82,234
82,113103,860
118,594(a) - (c)15,4091,103
14,306(Millions of yen)Mar. 31, 2019
Sep. 30, 2018(b)(c)
196,729
210,076
87,05986,634
109,669
123,441(a) - (c)Mar. 31, 2019(b)

(Millions of yen)Sep. 30, 2018(c)

Consolidated

Risk-monitored loans(A)
Collateral or guarantees, etc.
(B)
Allowance for loan losses(C)
Allowance ratio(C/A)
Coverage ratio(B+C)/(A)Sep. 30, 2019(a)407,640
156,173
178,405
43.76
82.07

(a) - (b)29,7965,752
5,960(1.87)(3.37)

3. Allowance for loan losses
Non-consolidated

Allowance for loan losses
General allowance for loan losses
Specific allowance for loan losses

Sep. 30, 2019(a)
202,342
83,753
118,589(a) - (b)
1,634
1,640
(5)

Consolidated

Allowance for loan losses
General allowance for loan losses
Specific allowance for loan losses

Sep. 30, 2019(a)
212,138
88,162
123,975(a) - (b)
2,062
1,528
534

4. Non-performing loans based on the Financial Reconstruction Law
Non-consolidated
Sep. 30, 2019(a)Claims against bankrupt andsubstantially bankrupt obligors
Claims with collection risk
Claims for special attention
Total

(A)

(a) - (b)142,337

33,946

96,971

108,391

45,36699,212
157,494
399,044(37,265)
32,39529,076(54,667)
81,648
123,952

136,477
125,099
369,968

153,879
75,846275,092

5. Status of coverage of non-performing loans based on the Financial Reconstruction Law
Non-consolidated

Total coverage
Allowance for loan losses
Collateral or guarantees, etc.
Coverage ratio(B)

Sep. 30, 2019(a)
327,503173,740
153,763(a) - (b)11,0774,993
6,085(a) - (c)88,03935,60752,433

(B/A)

82.07

(3.45)(4.97)−19−(Millions of yen, %)Mar. 31, 2019
Sep. 30, 2018(b)(c)
239,464
316,426
138,133
168,747
101,330
147,678
85.52

87.04

Suruga bank, Ltd.

6. Loan breakdown by industry, etc.
(1) Loan breakdown by industry (Non-consolidated)
Sep. 30, 2019(a)
Domestic offices (excluding Japan
offshore banking accounts)
Manufacturing
Agriculture and forestry
Fishery
Mining, quarrying and gravel
Construction
Utilities
Information and communication
Transportation and postal service
Wholesale and retail trade
Finance and insurance
Real estate, goods rental and leasing

Services
Government and municipal government

Others(Millions of yen)Mar. 31, 2019(b)

Sep. 30, 2018(c)(a) - (b)(a) - (c)2,671,642(227,222)(414,232)

2,898,864

3,085,874

37,336
4,571
0
255
8,748
1,056
1,225
9,829
31,60327,26253,73527,6803,626
2,464,705(1,309)(90)(35)
5(3,968)
(24)
(91)
(165)
542
(553)
(10,347)(1,145)(1,089)(208,955)(10,792)
(198)
(36)
1
(4,432)(135)(130)(2,931)(9)(43,401)(13,861)(3,308)(557)(334,441)

38,6454,661
35
250
12,716
1,080
1,316
9,994
31,061
27,81564,082
28,825
4,715
2,673,660

48,1284,769
36
254
13,1801,191
1,355
12,76031,61270,66367,59630,9884,183
2,799,146(2) Breakdown of risk-monitored loans by industry (Non-consolidated)
Sep. 30, 2019(a)
Domestic offices (excluding Japan
offshore banking accounts)
Manufacturing
Agriculture and forestry
Fishery
Mining, quarrying and gravel
Construction
Utilities
Information and communication
Transportation and postal service
Wholesale and retail trade
Finance and insurance
Real estate, goods rental and leasing

Services
Government and municipal government

Others ※(a) - (b)(Millions of yen)(a) - (c)Mar. 31, 2019(b)

Sep. 30, 2018(c)

398,991

29,094

123,959

369,897

275,032

1,441
1,119
4
150
80
2,083
6,879
37,0291,688
348,514

155
(33)
(87)
(1)
25
(1)
81
(191)
(4,094)344
32,898

77
(33)
(62)
(1)
25
(3)
168
6,879
18,520177
98,213

1,286
33
1,206
5
125
81
2,002
7,070
41,123
1,344
315,616

1,364
0
33
1,181
5
125
83
1,915
18,5091,511
250,301(Note)”Others” includes real estate financing for rent to individuals.

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Suruga bank, Ltd.

(3) Consumer loans (Non-consolidated)

Consumer loans
Secured loans
Unsecured loans(Millions of yen)Sep. 30, 2019(a)2,455,483
2,231,597
223,885(a) - (b)(209,371)(192,881)(16,490)(a) - (c)(335,401)(301,744)(33,658)

Mar. 31, 2019(b)
2,664,854
2,424,478
240,375

Sep. 30, 2018(c)
2,790,884
2,533,341
257,543(4) The ratio of loans to small- and medium-sized enterprises, etc. (Non-consolidated)
Sep. 30, 2019(a)
The ratio of loans to small- andmedium-sized enterprises, etc.

98.46(a) - (b)(%)(a) - (c)

0.06

1.58

Mar. 31, 2019(b)

Sep. 30, 2018
(c)

98.40

96.88

(Note)“Loans to small- and medium-sized enterprises” includes consumer loans which comprise 91.90% of this total.

7. Loan breakdown by country(1) Loans to specific foreign countries (Non-consolidated)
Not applicable.
(2) Loans to Asian countries (Non-consolidated)
Not applicable.

8. Deposits and loans (Non-consolidated)(Millions of yen)

Deposits
Loans

period-end balance
average balance
period-end balance
average balance

Sep. 30, 2019(a)
3,164,941
3,078,999
2,671,642
2,739,369(a) - (b)(739)(425,214)(227,222)(315,391)(a) - (c)(250,989)(712,322)(414,232)(395,516)

Mar. 31, 2019(b)
3,165,680
3,504,213
2,898,864
3,054,760

Sep. 30, 2018(c)
3,415,930
3,791,321
3,085,874
3,134,885

9. Number of branches (Non-consolidated)(Branches)

Number of branches

Sep. 30, 2019
(a)
130

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(a) - (b)(a) - (c)(1)(2)

Mar. 31, 2019(b)
131

Sep. 30, 2018(c)132

Suruga bank, Ltd.

Ⅳ. Unrealized gains (losses) on securities
1. Unrealized gains (losses)
Non-consolidated(Millions of yen)Sep. 30, 2019
Mar. 31, 2019
Sep. 30, 2018
Fair Net unrealized gains (losses) Fair Net unrealized gains (losses) Fair Net unrealized gains (losses)
value
Gains Losses value
Gains Losses value
Gains Losses

Other
securities
Stocks
Bonds
Others113,579

10,732

11,167435 117,364

17,254

17,625371 128,203

20,927

21,381454

17,577
94,509
1,493

9,301
703
727

9,596
705
865

294
2
138

15,911
658
683

16,160
662
802

249
3
118

20,483(244)
687

20,551
43
787

67
287
99

26,17086,734
4,459

33,52489,0705,608(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.
Consolidated

Other
securities
Stocks
Bonds
Others(Millions of yen)Sep. 30, 2019
Mar. 31, 2019
Sep. 30, 2018
Fair Net unrealized gains (losses) Fair Net unrealized gains (losses) Fair Net unrealized gains (losses)
value
Gains Losses value
Gains Losses value
Gains Losses
116,261

13,192

13,627435 119,768

19,43619,808371 130,797

23,29923,754454

18,261
94,509
3,491

9,888
703
2,600

10,182
705
2,738

294
2
138

16,352658
2,424

16,601
662
2,543

249
3
118

21,145(244)
2,397

21,213
43
2,497

67
287
99

26,70986,734
6,325

34,28489,0707,442(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.

Ⅴ. Retirement benefits
1. Retirement benefit expenses
Non-consolidated(Millions of yen)Six months ended
Six months ended
Sep. 30, 2019
Sep. 30, 2018
Service cost
253
264
Interest cost
52
54
Expected returns on plan assets
(439)
(386)
Amortization of unrecognized net actuarial gains (losses)
(438)
(164)
Others (non-recurring extra retirement payments, etc.) (Note1)
107
106Retirement benefit expenses
(464)
(124)
(Note1) “Others (non-recurring extra retirement payments, etc.)” includes the contribution to a defined contribution pension plan.
Consolidated(Millions of yen)Six months ended
Six months ended
Sep. 30, 2019
Sep. 30, 2018
Service cost (Note1)
264274Interest cost
52
54
Expected returns on plan assets
(439)
(386)
Amortization of unrecognized net actuarial gains (losses)
(438)
(164)
Others (non-recurring extra retirement payments, etc.) (Note2)
113
112
Retirement benefit expenses
(446)
(108)
(Note1) Retirement benefit expenses of consolidated subsidiaries adopting a simplified method are included in “Service cost”.
(Note2) “Others (non-recurring extra retirement payments, etc.)” includes the contribution to a defined contribution pension plan.

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