2021 Annual Report

Tokyo Kiraboshi Financial Group, Inc.

Business name: Tokyo Kiraboshi Financial Group, Inc.
Head office

3-10-43 Minami Aoyama, Minato-ku, Tokyo

Established

October 1, 2014

Capital¥27.5 billion

Exchange listing

Tokyo Stock Exchange, First Section(Securities Code: 7173)

Websitehttps://www.tokyo-kiraboshifg.co.jp(As of June 30, 2021)

First, I would like to express my gratitude to
you all for your support.
I would like to express my heartfelt sympathies
for everyone in Japan who has been affectedby COVID-19, which continues to strike theworld. In addition, I would like to express mysincere gratitude for the local government
personnel and the medical personnel who aresupporting local health care on a daily basis.
The business environment surrounding theGroup is affected by the decline in populationand the continuation of the low-interest-rate
polic y, making the transformation into asustainable business model a pressing issue
while also leading to heightened importanceof initiatives contributing to sustainable local
communities based on ESG/SDGs. Furthermore,apart from the significant changes in lifestyles

and economic activity brought about by the
spread of COVID-19, the services required bycustomers are also changing significantly withthe acceleration of digitalization.
As the Group embraces the challenge of new
business models and streamlines management
on a day-to-day basis, we launched our new
Medium-Term Business Plan in April 2021. We
will strive to make further reforms with our
vision of “be a Tokyo-based platform ownerthat creates new valu es for custo mers .”Specifically, by implementing “managementbase reform” such as the promotion of digitaltransformation (DX) and “business structurereform” such as middle risk taking and theprovision of equity capital, we will function asa coordinator hub as we endeavor to create
value for customers.

The Group intends to continue to contribute to
the sustainable development of local economies
and local communities to meet customers’
expec tations by fur ther enhancing the
combined strength of the Group and maximizing
synergies. On behalf of the Group, I ask for yourcontinued support and encouragement.
July 2021

Hisanobu Watanabe
President, Tokyo Kiraboshi Financial Group, Inc.
President, Kiraboshi Bank, Ltd.

Contents

Management Philosophy and Management Policy･･･････ 1

Management philosophy

Tokyo Kiraboshi Financial Group
Message from Top Management･･･････････････････････ 3
History of the Kiraboshi Group･････････････････････････ 7Tokyo Kiraboshi Financial Group’s Value Creation Process････ 9

To be a financial group for small and medium-sized enterprise customers andindividual customers in the Tokyo metropolitan area that will contribute to thedevelopment of local communities through comprehensive financial services.

Growth Strategy
Medium-Term Business Plan (FY2021-2023)･･･････････ 11
Features
ESG/SDGs Initiatives in the Strategy of the Medium-Term Business Plan････ 13Tokyo-based Platform･･････････････････････････････ 14

Management policy
Achieve enduring existence as a local regional financial group through ･････ A group thatthe provision of unique financial services
sparklesLeverage the special features of the Tokyo area to continue to meet new challenges
A group that rises･････
in order to contribute to the development of our customers and of local economies
to the challenge
We put great value on the “thoughts” of customers, the region, and our employees,
and seek to develop a presence that is always in need and worthy of trust.

1 │Tokyo Kiraboshi Financial Group, Inc.│･････ group that bringsA
together thoughts

Initiatives for Strengthening Management BaseTokyo Kiraboshi Financial Group SDG Declaration････ 15
Environmental Initiatives･･････････････････････････ 17
Communication with Stakeholders･ ･･････････････ 19
Corporate Governance･･･････････････････････････ 25
Risk Management･ ･･･････････････････････････････ 29
Compliance･･････････････････････････････････････ 32
Corporate Data･････････････････････････････････････････ 35
Consolidated Financial Statements･････････････････････ 37│Tokyo Kiraboshi Financial Group, Inc.│ 2

President, Tokyo Kiraboshi
Financial Group, Inc.

President, Kiraboshi Bank, Ltd.

Awareness of changes in thebusiness environment
The greatest immediate concern in the businessenvironment is the impact of the spread of
COVID-19. At present, the impact is centered on
the restaurant industry, the tourism industry, thetravel industry and the service industry, and thescale is prolonged and worldwide. I am worried
that a wider range of industries will be affectedin the future. The impact on the performance of
medical corporations is also pronounced, and as
Kirab oshi Bank is associated with manycustomers in the medical and welfare fields, theGroup as a whole will strengthen support suchas individually forming funds.
From a medium-term perspective, although the
Nikkei average has shown phases of rising suchas exceeding 30,000 yen at one point, corporate
performance is becoming increasingly polarized.
In this context, there has been an increase inmanagers considering issues such as businesssuccession, and I believe we need to provide
firm support for individual circumstances of ourcustomers, particularly for small and medium
businesses.
Fro m the p ersp e c tive of the enviro nment
surrounding regional banks, the declining birthrate
and aging population along with the decline in
population have progressed further, and theTokyo area is no exception. The low-interest-rate
KPIs used in the previous
Medium-termManagement Plan
Number of first callcontacts

FY2018Plan

Results

7,000
11,290contacts contacts

Number of recipients of financing based
600
1,153
on business feasibility evaluations
recipients recipients

3 │Tokyo Kiraboshi Financial Group, Inc.│

Achievement
Rate

policy has also been protracted, and banks are
faced with the pressing issue of departing fromthe traditional business model of making a profit
from the margin between deposits and loans.
I n a d d i t i o n , C O V I D -19 h a s s i g n i f i c a n t l ytransformed the role of bank branches due tothe advancement of cashless payment anddigitalization. Also, digital transformation (DX) of
society as a whole has accelerated, and of theth re e majo r o p e ratio ns of b a n k s , na m ely
d e p osit s , lo a ns a n d fo rei gn excha n ge,
competitive relationships have become more
complicated in loans and foreign exchange withmany companies from other industries offering
services utilizing advanced digital technology. At
any rate, we are aware that we have entered an
e ra i n w h i c h i t i s e s s e n t i a l fo r b a n k s toimplement new business models for creating
new earning opportunities without relying onjust their core businesses.

Reflecting on the previous
Medium-Term Business Plan
Under the previous Medium-term Business Plan,
we created a system for the realization of a“comprehensive service business that is alsostrong in finance” by leveraging the collective
streng th of the Group through three main
measures in the form of “enrichment of consulting
functions,” “developing human resources that are
FY2019Plan

Results

161.3％

7,000
14,870contacts contacts

192.1％

600
1,082
recipients recipients

AchievementRate

FY2020
Plan

Results

212.4％

7,000
17,738contacts contacts

180.3％

600
934
recipients recipients

Achievement
Rate
253.4％
155.6％

Implementing reforms based on the catchword
of “CSR+C” based on the business plan
When I was appointed as President of Kiraboshi
Bank in 2018, the first things I told employees
were (1) The merger is not the goal, (2) Let’s aim
to make an organization where everyone feels
glad to be able to work in the company, and (3)Let’s create new value for the Group while
placing importance on the values andexperiences we have established with themindset of everyone being transferred to the
Kiraboshi Group. We also implemented initiatives
with “CSR+C” as our catchword, meaning eachindividual would have venture spirit, face
Challenges, have Speed and take Risks and also
Change themselves.
Actually, these three years have presented
continuous challenges, and we were able toaddress them with considerable resolve andspeed. The employees who have developed inbanks with different products, screening systems,
I T s y s t e m s a n d c o r p o r a t e c u l t u re s h a v eendeavored to quickly become part of Kiraboshi
i n t h e n ew b a n k . T h e syste m i nte g rati o ncompleted last May was the culmination ofthese efforts. We managed to unify the systems
by p ro ce e din g with th e inte gratio n w hileproviding each other with guidance on unfamiliar
systems while executing normal business. I
respectfully acknowledge that it must have beena substantial burden for the employees.
Furthermore, system integration was madepossible by the trust we have received such as
the understanding and cooperation of customers
for changes in produc t s and ser vices andtemporary stoppages in ATM services, and I
believe that successfully implementing the
integration despite the challenges presented by
COVID-19 was a great achievement. We haveswiftly rebuilt our branches, and the consolidationof 25 locations implemented in the first year of
Kiraboshi Bank significantly contributed toperformance the following year.
At present, the Kiraboshi Group’s share in Tokyois less than 10%. Considering regional banks

Growth strategy in the new
Medium-Term Business Plan
In the new Medium-Term Business Plan, we havepresented the vision of “be a Tokyo -based
platform owner that creates new values forcustomers.” This vision aims to shift from thetraditional B-to-B style and creating mechanismsthat are more useful for improving customers’
per formance and able to contribute torevitalization and sustainable growth of theregion. We would like the Kiraboshi Group toplay a central role in enabling the platforms andcontent of “customers and customers” and“customers and communities” to connect witheach other, and provide support for value
creation through the creation of new relationships
not limited to existing matching functions.
In addition, in order to proceed with specificmeasures to realize this, Kiraboshi Bank has a
two-pronged strategy in which it plays a pivotal
role in a “Project for becoming customers’ mainbank” increasing the number of customers thattreat us as their main bank who they first consult
to resolve issues, and a “Group strategy” offering
services other than finance.

│Tokyo Kiraboshi Financial Group, Inc.│ 4

Growth Strategy

Hisanobu Watanabe

usually have a share exceeding 30% or even 50%,
this indicates that there is still much room fordevelopment. Moreover, Tokyo is an enormous
market of ¥140 trillion accounting for a quarterof Japan’s GDP, and its soil makes our aspirations
possible.
Due to the size of the market, competition isintense. However, in order to enable customers
to have a true sense of value, our strategy has
b e e n to e s t a b l is h su b si d ia ri e s su ch a s aconsulting company and a securities company
within the Group and to swiftly expand ourservice menu to be equivalent to those of
megabanks that are our most powerful rivals. At
the same time, we have actively engaged inproposals for industries with which we have had
l i t t l e co n t a c t i n t h e p a s t a n d c u s to m e rs
representative of the region, and also equity
operations providing capital lending.
While targeting the middle-risk, middle-returncustomers that we have not been able to fully
address in the past, we have also worked tostrengthen the risk department in order tocontrol risk appropriately. In particular, we havew o r ke d to s t re n g t h e n o u r c re d i t ris kmanagement stance by establishing the FinanceManagement Division last July and recruiting
external personnel with specialized knowledge.
Furthermore, we have also proceeded witho rga niz ati o nal refo rm s a n d creati o n o fmechanisms to improve productivity.
As a result, we have increased the lineup of theservice menu that Group companies can work
as one to offer as additional options to meet thediverse needs of customers. Furthermore, it isour view that by implementing our digitalstrategy, we have been able to establish ouroperational base to expand contacts with newcustomers with the provision of services thatmeet the needs of customers in a way that cano n ly b e a c h i eve d by a re g i o n a l f i n a n ci a linstitution based on face-to-face service.

Initiatives for Strengthening Management Base

Under the “Start-up ☆ Kiraboshi” Medium-Term Business Plan
that began with the merger of three subsidiary banks, weestablished strategic subsidiaries such as a securities
company, a capital company and a FinTech company aimed
at shifting from the existing Group structure centered onbanking to the creation of a new business model.
The new Medium-Term Business Plan launched this springsets forth a new vision of “be a Tokyo-based platform ownerthat creates new values for customers, from Tokyo to Japanan d A sia” to m ove close r to th e realiz atio n of a“comprehensive service business that is also strong in finance”
presented in our vision. Through the Group’s strengthfeaturing a multitude of functions and the provision of services
that only a regional financial group can provide, we will
establish the Kiraboshi brand that signals our presence in theTokyo area and obtains the trust of being the region’s No. 1.

trusted and chosen for their ‘dialogue’” and“business process re-engineering to strengthen
contact with customers.”
With a view to the business model that takes
dialogue as its starting point, we established the“first call” as a KPI that could be considered tobe evidence of being trusted by customers, andset a target of 7,000 calls per year. As a result,
we significantly surpassed the target every year
fo r th re e yea rs an d were able to expan dbusiness year by year. Approaches to newgroups of customers has also progressed, and it
is our view that we have been able to steadily
plant seeds leading to future growth.
At the same time, the streamlining of headquarters,
rebuilding branches and system integration that
we have engaged in with the aim of streamlining
management have progressed as planned, and I
think we have been able to build the foundation
for the implementation of the new Medium-TermBusiness Plan, such as making our core businessprofitable.

Corporate Data

Aiming to make a further leap as aTokyo-based platform owner creating
new value for customers

Tokyo Kiraboshi Financial Group

Message fromTop Management

Principles of action guideline for the “Kiraboshibito”
implementing the new Medium-Term Business Plan
When we formulated the new Medium-TermBusiness Plan, we also newly established the“Kiraboshi philosophy” and at the same time
indicated three principles of action guideline for
Kiraboshibito implementing the philosophy.
The first is to “have high aspirations.” Aspirations
refer to “aiming for the development of theorganization through contributions to society,and realizing self-fulfillment and one’s own
h a p p i n e s s ,” a n d i s n o n e o t h e r t h a n t h erealization of the Kiraboshi philosophy. In orderto ensure that we continue to shine in five to ten
years, it is vital that all officers and employees
are fully aware that we must keep the autonomy
and sustainability of business in mind without
overly focusing on what is in front of us.
Having high aspirations leads to thinking about
what can be done to achieve them. That is thesecond guideline, which is to “always think about
what can be done to achieve them.” It is better

Kiraboshi
philosophy

Guided by awareness, values and mindset that are to be shared by all officers and employees,

accomplish the goals of contributing to society, seeking growth of theorganization, achieving self-fulfillment and realizing oneʼs own happiness

Three principles of action
guideline for Kiraboshibito
Kiraboshibito

Principle/
sense ofmissionIngenuity/perseverance
Responsibility/courage〜Who are “Kiraboshibito” 〜

5 │Tokyo Kiraboshi Financial Group, Inc.│

An individual with “high aspirations”

Approach to sustainability
management
We recognize that aiming for a sustainable societyis the most important issue in the Group’s
mana gem ent . We est ablish e d t h e “To k yo
Kiraboshi Financial Group SDG Declaration” inMay 2019 and have been steadily implementing
initiatives based on five main themes*. With regard
to climate change, the Group is actively promoting
green investment and paperless operation
through digitalization, in addition to support forcustomers’ activities (environmentally aware
products and services, consulting services, etc.).
In February 2021, we announced our support forth e TCFD ( Ta sk Fo rce o n Climate - rel ate dFinancial Disclosures) recommendations, and as
part of our contribution to the realization ofsu s t a i n a b l e lo c a l co m m u n iti es , we m a d einvestments in the “Sustainability Bonds” issued
by the Japan Railway Construction, Transport
and Technology Agency in February and May.
Fu r t h e rm o re, b a s e d o n o u r b el ief t hat
management based on the creation of sharedvalue for customers and the region will lead tothe implementation of SDGs, we established the❶ Trustworthiness / satisfaction

An individual who always thinks “how it canbe done”

An individual who is committed to results,
who continuously takes on courageous challenges

People who put “Kiraboshi philosophy” into practice❸ Problemsolving
ability*(1) Environmental protection, (2) Contributing to local
communities, (3) Creating shared value with the customer, (4)Employees’ work style reform and promotion of diversity, (5)Dialogue with shareholders and investors

Risk compliance program
Under this plan, we aim to further enhance
initiatives to strengthen the integrated risk andcompliance management system that we have
implemented in the previous Medium-TermBusiness Plan. In addition, strengthening thism a n a ge m e nt s ys te m p rov i d es a ro b u s t
underpinning for the achievement of the Group’s
strategies and also leads to the visualization ofgroup risk associated with a “comprehensive
service business” and strengthening of control
functions.
Furthermore, we are also engaged in cybersecurity
from the aspects of both value creation and risk
management, and aim to provide ser vices
offering a high level of convenience and security.
Moreover, in addition to making the transition toa fundamental internal rating-based approach toenhance credit risk management, now that API
linkage connecting transactions with financial
institutions has progressed, and technologies for
AI processing of large volumes of data havebegun to become established, we are also
considering the utilization of digital technology
and AI in risk mitigation processes.

Message to stakeholders
Thanks to your support, over the past three
years we have absorbed the substantial cost of
the merger while streamlining management, andwe have established a structure that will enable
us to soar to the next level. The Medium-TermBusiness Plan that we have established is not alarge deviation from the strategies we haveadopted in the past, and is a plan that further
expands the initiatives we have taken until now
to the Group as a whole. All of ficers andemployees of the Group will work as one tocarry out the plan to ensure the preparations wehave made over the past three years bloom andlead into the next Medium-Term Business Plan.
As a financial group headquartered in Tokyo, we
aim to establish a strong presence in this market
and would like to ensure that the Kiraboshi
Group meets the high expectations of all of its
stakeholders. I ask for your continued supportand encouragement.

❷ Capabilities to create
new businesses andservices│Tokyo Kiraboshi Financial Group, Inc.│ 6

Growth Strategy

The “Kiraboshi brand” can only be establishedonce people think “ the Kiraboshi Group isessential for the region.” To aim for this goal, it isessential that we obtain a certain share, and inorder to do this, it is vital that we are supportedby the people in the community.
In the new Medium-Term Business Plan, we havestrengthened strategies with greater awarenessof regional development than in the past, and set
financial targets with a view to growing theGroup to a level of profit enabling us to have asuitable presence as a regional financial groupheadquartered in Tokyo. When the seeds wehave sown over the past three years sprout andwe have obtained the confidence of being
connected to the creation of relationships of trustwith customers, we should be able to accelerate
to obtain the trust of “No.1 in the region.”
Looking ahead, burden of merger cost of ¥3-4
billion annually will be lifted, and we also expect
to achieve cost reductions in the range of ¥10.5
billion through management streamlining. The
effect of the streamlining we have implemented
to date combined with the execution of thegrowth strategy under this plan will enable us toreach our consolidated profit targets of ¥10billion in FY2021, ¥16 billion in FY2022 and ¥20
billion in FY 2023.

resolving of the three social issues of “lifestylesupport for seniors,” “comprehensive support forcustomers’ issues such as business succession”
and “management support for medical institutions”
as priorit y areas in the new Medium -TermBusiness Plan.
We aim to realize a management model thatperceives the creation of economic value andsocial value to be connected.

Initiatives for Strengthening Management Base

Goals to achieve in the new
Medium-Term Business Plan

Our policy is to execute short-term, low-costm e a su re s a i m e d a t t h e c re a t i o n o f su c hprofitability, and the launch of digital banking
currently underway utilizes the system of SBJ Bank
through an alliance with the South Korean Shinhan
Financial Group. In addition, we are actively
engaged in alliances and business partnerships
with a variety of business operators, and would
like to expand partnerships transcending industry
boundaries in future as needed.
Furthermore, as the number of companies is in
decline even in the region of Tokyo, based on
the belief that one of our major roles is to create
new industries, we have devoted considerable
energy to supporting start-ups and venturebusinesses since the merger. We have received acertain level of recognition for our efforts tomake “Kiraboshi Bank the natural partner for
start-ups” and, in order to increase our presence,
we would like to continue to further focus on
supporting venture businesses such as continuing
the Venture Championship backed by the Tokyo
Metropolitan Government and the utilization of
investment funds.

Corporate Datafor two people to think than one, and for three
to think than two, and we would like everyone tothink together such as getting other departments
involved while viewing oneself as the center of
one’s life and establishing a presence.
The third guideline is to “be a person who
commits to results and continues to boldly faceand embrace challenges.”
These three principles of action guideline arealso action guidelines for management indicating
the resolve to achieve a higher level in the new
Medium-Term Business Plan. In order to achieve
the plan together, I would like to make anorganization in which everyone works as one
and shares the joy of achievement together.

In order to increase value for customers, the firstthing we must do is assist with the expansion ofcustomers’ technologies and services. Secondly,
we must support the improvement of efficiency
of customers’ management. In particular, we areconsidering personnel support such as for thecreation of new mechanisms for small andmedium businesses. In my own discussions withcustomers, I have told them, “Please use ourGroup as a division of your company.”
I think it is important to properly convey andmake customers aware that we are able toprovide a wide range of assistance for increasing
corp orate value through our ser vices ando p e r a t i o n s l e a d i n g t o t h e re s o l u t i o n o fcustomers’ issues, such as the creation of new
systems and rules, implementation of businesssystems and support for digital strategy. We will
aim to make the Kiraboshi Group No.1 in theregion for the Tokyo area where we have apresence by receiving “first calls” and meetingcusto m ers’ exp e c tatio ns w hile expan dingopportunities for dialogue with customers.

Tokyo Kiraboshi Financial Group

Message fromTop Management

History of the Kiraboshi Group

Established on
May 1, 2018

・Tokyo Kiraboshi Lease, Inc. ・Kiraboshi Life Design Securities Co., Ltd.
・Kiraboshi System, Inc. ・Kiraboshi Digital Bank Preparatory Co., Ltd.
・Kiraboshi Consulting Co., Ltd. （Scheduled to start operation in FY2021）
・Kiraboshi JCB Co., Ltd. ・Kiraboshi business oﬃce service, Inc.
・Kiraboshi Capital Co., Ltd.

from mergerof 3 banks

Group companies
Kiraboshi Credit Guarantee Co., Ltd.
Yachiyo Credit Guarantee Co., Ltd.
Kiraboshi Business Service Co., Ltd.
Kiraboshi Tech, Inc.
Kiraboshi Business Consulting Shanghai Co., Ltd KIRABOSHI BUSINESS CONSULTING VIETNAM Co., Ltd. Kiraboshi Insurance Agency CO., LTD.(equity method aﬃliate)

Apr

2016
Apr

Dec

Establishment of Kiraboshi Securities Preparatory Co., Ltd.
(Kiraboshi Digital Bank Preparatory Co., Ltd.)To embrace a new challenge
of developing securities
business in the Tokyo area

Birth of Tokyo TY Financial Group

Change of business name from Kiraboshi Service
to Kiraboshi Business Oﬃce Service

Fu t u re image

2018
May

Establishment of Kiraboshi
Consulting
To strengthen consulting
functions aimed at enhancing
comprehensive ﬁnancial services

Sept

May

Systems integration

June

Head Oﬃce relocation
Relocation from Shinjukuku(Shinjuku oﬃce) to
Minato-ku (Kiraboshi Bank
Aoyama head oﬃce)

Aug

Establishment of Kiraboshi Life
Design Securities

Establishment of Kiraboshi Capital
To respond to the needs inmezzanine, funding (incl. IPOs)

Oct

Establishment of Kiraboshi
Digital Bank Preparatory Co., Ltd.
Expansion of non-face-to-faceservice that puts the customer ﬁrst

Kiraboshi Capital Co., Ltd.

Nov Establishment of Kiraboshi Tech
To expand into the FinTech area

Kiraboshi Tech, Inc.

Previous Medium-Term Business Plan

New Medium-Term Business Plan

Creation of a Tokyo-based platform⃝ Contribution to sustainable growth of theregion utilizing the Group’s strength⃝ Creation of new value connecting customers with the region⃝ Establishment of strategic subsidiaries suchas securities, capital and FinTech

Business process re-engineering

Promotion of DX⃝ Strengthening of contact with customers

Human resources development⃝ Development of “Kiraboshibito” chosen and trusted through dialogue

Improvement of management efficiency⃝ Improvement of headquarters efficiency⃝ Rebuilding branch network through consolidation of locations, etc.
⃝ Systems integration of subsidiaries

2014

2015

Consumption tax raised to8%

FRB lifts zero interest policy

Greek financial crisis
Launch of Asian Infrastructure Investment Bank

7 │Tokyo Kiraboshi Financial Group, Inc.│

2016“A comprehensive
service businessthat is also strong
in finance”

2020

Formulation of the Medium-TermBusiness Plan
“Start-up
Kiraboshi”

Enrichment of consulting functions

External movements

Tokyo Kiraboshi Financial Group

Opening of subsidiary in Vietnam

Formulation of new Medium-Term Business Plan
Decision to change business name after launch of
Kiraboshi Digital Bank Preparatory Co., Ltd.
UI BankBirth of Kiraboshi Bank

Kiraboshi Consulting Co., Ltd.
Business integration with
ShinGinko Tokyo

Oct

Apr

Conversion of three companies towholly-owned subsidiaries
To enhance group function(Tokyo Kiraboshi Lease, Kiraboshi
System and Kiraboshi JCB)

Oct

2017

Movements of Tokyo Kiraboshi Financial Group

2014

Aug

2017

Start of My Number System Donald Trump inaugurated
Implementation of negative as 45th President of theUnited Statesinterest rate policy by BoJ

Toward establishing the“Kiraboshi Brand” as theNo.1 financial group in
the region with a strong
presence in the Tokyo area

⃝ Merging of face-to-face and non-face-to-face channels throughdigital banking, merging of financial and non-financial services

Human resources development⃝ Penetration of the Kiraboshi philosophy andimplementation of SDGs
⃝ Development of “Kiraboshibito” throughlinkage with personnel system reform

2018

2019

2020

2021

TPP11 takes effectName of era changed from Heisei to Reiwa

UK withdraws from EU

Tokyo Olympics

Establishment of work-style reform bill Consumption tax raised to 10%
Kumamoto earthquakes

Growth Strategy（As of April 1, 2021）

2021

2019

Initiatives for Strengthening Management BaseOn May 1, 2018, the Tokyo Tomin Bank, Limited, the Yachiyo Bank, Limited and the ShinGinko Tokyo,
Limited merged to form the new “Kiraboshi Bank.” With the merger of the three banks, the businessname of the group was changed from Tokyo TY Financial Group to “Tokyo Kiraboshi Financial Group.”With the management philosophy “To be a financial group for small and medium-sized enterprisecustomers and individual customers in the Tokyo metropolitan area that will contribute to thedevelopment of local communities through comprehensive financial services,” we aim to develop “acomprehensive service business that is also strong in finance.”

5G service commences in countries worldwide

Global spread of
COVID-19│Tokyo Kiraboshi Financial Group, Inc.│ 8

Corporate Data

Tokyo Kiraboshi Financial Group, Inc. was born through the merger of three banks.

stakeholders

Tokyo-based platform

Customers, local communities

Strengthening of SDG initiatives

Kiraboshi platform

Business tools for older adults⃝ Diverse human resources⃝Business succession business⃝ Kiraboshibito	U nifie d su p p o r t cove rin g
corporate management,

Intellectual capital⃝ Promotion of DX⃝ Business process re-engineering⃝ Evaluation of business feasibility

Management philosophy

business succession, asset
management and overseas
business development⃝ Medical institutions support business⃝ Consulting functions⃝ Diverse funding methods

Contribution to sustained⃝ Linkage with FinTech

care services

growth of community health⃝ Trust functions

Social/related capitalManagement policy⃝ Digital Bank business⃝ Collective strength of Kiraboshi Group⃝ Branch functions matching regional characteristics

New Medium-Term Business Plan

(China, Thailand, Vietnam, etc.)

Be a Tokyo-based platform owner⃝	Asian network⃝ Customer basethat creates new values for customers

Cross-industrial collaboration
to respond to diverse life
scenes⃝ Start-up support businessSupport from early stage to

Exhibiting ability to make proposals
through intra-group collaboration

Group business strategy●Banking ●Trust●Consulting●Utilization of FinTech●Fund formation and management●Leasing ●Credit cards Collaboration with external partner●Guarantee company ●IT organizations and external
specialized organizations●Various services

Provide consulting services to improve corporate value
Ensure commitment to customer-oriented business practiceServe the functions of a trading company in the Tokyo metropolitan area

9 │Tokyo Kiraboshi Financial Group, Inc.│─⃝ Life plan support business

Human capital

Kiraboshi philosophy
Three principles of action guideline for Kiraboshibito

SDGs of the Kiraboshi GroupA comprehensive service businessthat is also strong in finance

IPO⃝ Corporate reconstruc tion(manage m e nt su p p o r t)
business
Management support package⃝ Improvement of reliability and satisfaction
Further promotion of ﬁrst-call exercise
Enhancement of governance system⃝ Improvement of ability to create
new businesses and services
Enhancing the collective strengthof the Group
Improvement of skills of officers
and employees⃝ Improvement of problem-solving ability
Long-term support, etc. throughrisk taking
Creation of new customer value
and social value
Contribution to the sustainablegrowth of society

Employees⃝ Developing Kiraboshibito⃝ Putting in place an environment inwhich diverse human resources canwork to implement the business model

Growth Strategy⃝ Abundant net assets

Services, etc. provided

Initiatives for Strengthening Management Base

⃝ Sound loan assets

Creating value with⃝ Achieving work-life balance by
providing flexible work styles⃝ Involvement of diverse human resources

Shareholders and investors⃝ Maximizing shareholder value
over the medium to long-term⃝ Constructive dialogue⃝ Highly transparent disclosure
including non-financial information│Tokyo Kiraboshi Financial Group, Inc.│ 10

Corporate Data

Financial capital

OUTPUT

Creation of shared value

Management resources utilized

Resource allocation reform, strengthening of management base

─

INPUT

Tokyo Kiraboshi Financial GroupTokyo Kiraboshi Financial Group’s Value Creation Process

Growth Strategy ─ Medium-Term Business Plan (FY2021-2023) ─Management
policy経営

A group that sparkles

A group that rises tothe challenge

A group that brings
together thoughts

理念

Previous Medium-Term Business
Plan “Start-up ☆Kiraboshi”

経営方針

Vision weare aimingforBe the urban regional bankgroup most favored bycustomers in the Tokyo
metropolitan area

ビジョン
（目指す姿）

Kiraboshi
philosophy

accomplish the goals of contributing to society, seeking growth of theorganization, achieving self-fulfillment and realizing oneʼs own happiness

Three principles of action
guideline for Kiraboshibito

Responsibility/couragethat creates new values for customers~ From Tokyo to Japan and to Asia ~〜Who are “Kiraboshibito” 〜

FY2021 ~3 years

New Medium-Term Business Plan

Be a Tokyo-based platform owner and drive reform

Basic strategy
Consulting business・Proposals to support customersʼ mainstay operations
・Life plan support proposals

Financing based on business feasibility evaluations

・Problem-solving proposals based on
business feasibility evaluations(individuals)

FY2023Evolution of first calls and enhancement of problem-solving approaches②Deliver proposals to customers

Understanding ofcustomersʼ life plan

People who put “Kiraboshi philosophy” into practicehttps://www.tokyo-kiraboshifg.co.jp/english/pdf/business_pdf11.pdf

Previous Medium-Term Business Plan “Start-up ☆Kiraboshi”(corporates, business owners)

An individual who is committed to results,
who continuously takes on courageous challenges-Outline of the Medium-Term Business Plan April 2021 - March 2024

seeks to strengthen proposal capabilities based on “first call” approach. Be a Tokyo-based platform owner and drive reform

Understanding ofbusiness feasibility

An individual who always thinks “how it canbe done”

Further details of the Medium-Term Business Plan and the Growth Strategy aredescribed in the Business Report:“First call” exercise set out in the previous Medium-Term Business Plan has taken hold. The new Medium-Term Business Plan
3 years

An individual with “high aspirations”

Ingenuity/perseverance

Be a Tokyo-based platform ownerBusiness Strategy of the New Medium-Term Business Plan

①Understand customers

Principle/
sense ofmissionKiraboshibito

New Medium-Term Business Plan

Vision of the future: Comprehensive service business that is also strong in finance.

FY2018 ~Guided by awareness, values and mindset that are to be shared by all officers and employees,［ Reform of management base ］③Increase first call contacts
Headquarters supportof sales offices

Construct structure to provide comprehensive financial services as a unified Group●Kiraboshi Consulting (Apr. 2017)●Kiraboshi Tech (Nov. 2017)●Kiraboshi Capital (Sep. 2018)●Kiraboshi Vietnam (Jun. 2019)●Kiraboshi Life Design Securities (Aug. 2020)●Digital Bank Preparatory Company (Oct. 2020)⃝ Digital transformation (DX)			
Fusion of face-to-face and non-face-to-face, financial
and non-financial services⃝ I m p rove m e nt o f h ea d q u a r te rs ef fi ci e n c y a n denhancement of headquarters sales activities⃝ Radical branch reorganization and strategic personnel
allocation⃝ Human resources development and personnel system
reform［ Reform of business structure ］❶ Kiraboshi that supports the older generation❷ Provision of medium risk-taking and equity financing❸ Demonstration of Group synergy effects

Act as coordinator /provide hub functions
Create customer value
Create customersʼsocial value

Group business strategy Examples of platform functions❶ Life plan support businessBusiness tools for older adults

11 │Tokyo Kiraboshi Financial Group, Inc.│❷ Digital Bank business
Cross-industrial collaboration to
respond to diverse life scenes❸ Start-up support businessSupport from early stage to IPO

Growth Strategy

customers in the Tokyo metropolitan area that contributes to the development of local
communities through comprehensive financial services❹ Business succession business❺ Medical institutions

Unified support covering corporate management,

support businessbusiness succession, asset management andContribution to sustained growth ofoverseas business development

community health care services

Initiatives for Strengthening Management Base

To be a financial group for small and medium-sized enterprise customers and individual

Corporate DataManagement
philosophy

Tokyo Kiraboshi Financial Group

Vision of the New Medium-Term Business Plan (FY2021-FY2023)❻ Corporate reconstruction(management support) business

Management support package│Tokyo Kiraboshi Financial Group, Inc.│ 12

ESG/SDGs Initiatives in the Strategy of the Medium-Term Business Plan

Tokyo-based Platform⃝ The Company secures solid financial strength and enhances its competitive strength➡ serves to help customers achieve sustainable growth and contribute to the sustainablegrowth of local communities⃝ Leverage the Groupʼs collective strength to push forward SDG initiatives in the three priority areasof “support for the older generation”, “integrated support for business succession, corporate
management and asset management” and “management support for medical institutions”.
⃝ Contribute to the sustainable growth of society while enhancing financial and competitive
strengths of the Company

Create a “Tokyo -based platform” that fully leverages Group synergies to assist the
improvement of customers’ performance and contributes to revitalization and sustainablegrowth of the region, with the aim of “be a Tokyo-based platform owner that creates newvalues for customers”.

Contribution to the sustainable growth ofsociety

Increased focus on SDG initiatives
Strategy 1

Strategy 5

Clarification of
branch functions

Livelihood support for the older generation

Enhancement of proposal
capabilities for deliveringhigh value-added faceto-face services throughbranch reorganization

Strategy 2
Business process re-engineering(sales offices, headquarters, work style)Freeing up management
resources throughimproved efficiency ofbusiness processes toprovide high value-added
face-to-face services

Strategy 3
Development of humanresources / self-fulfillment
Development of humanre s o u rc e s a n d s e l f fulfillment for thedelivery of high valueadded face - to - faceservices

13 │Tokyo Kiraboshi Financial Group, Inc.│

Kiraboshi that supports
the older generation
Solving life issues such as
watching over and caring

Strategy 4
Reallocation of management
resources freed up through improved
efficiency to optimum areas

Enhancement offinancial andcompetitive strengths

Transformation of
resource allocation

Enhancement ofmanagement base

Personnel allocation
for providing highvalue-added faceto-face services

Continuous provision ofhigh value-added services,enhancement of financial
and competitive strengths
to co nt ri b u te to t h esustainable growth ofsociety

Digital transformation (DX)
Establishment of Digital Bank, improvement ofcustomer convenience
Fusion of face-to-face and non-face-to-faceservices, fusion of financial and non-financial
services

Property management
using trust functions⃝ Be a coordinator connecting customers
with companies in other industries,
provide hub functions and contribute to
the creation of customer values and tosolving social issues

Example of Tokyo-based Platform
Kiraboshi platform, concrete example of Tokyo-based ecosystem:
Tokyo Kiraboshi FG acting as coordinator to provide platform functions
Concrete example of Tokyo-based ecosystem① Collaboration with administrative organs

Strategy 6
Activities to address customersʼ
business succession and other issues
Business succession
Corporate management
Asset management forbusiness owners

Strategy 7
Support for medical
institutions
Management support /business succession
Contribution to sustained
growth of community
health care services

Growth Strategy

Enhancement of financial andcompetitive strengths to contribute to
the sustainable growth of society

Creation of new customer value and social
value⃝ Build a “Tokyo-based platform” for creating
new values through collaboration witha d m i n i s t ra t i ve o rga n s a n d a c ro s sindustries(airports and other social infrastructure,companies in entertainment, art, sports
and other similar industries)[Comprehensive coll ab oration w ith Tok yo
Metropolitan Government, Kawasaki City, etc.]

Image of Tokyo-based ecosystem
Fusion of ﬁnancial and non-ﬁnancial services
Provision of ﬁnancial services starting with non-ﬁnancial services

Mutual collaboration in implementation of initiatives forindustrial development, including support for SMEs, withthe aim of achieving sustained development of regional
economies
Collaboration in infrastructure and financial areas in pursuitof the International Financial Center concept② Collaboration with Haneda Airport [Agreement signed on April 20, 2021]
A. [ Comprehensive collaboration with Haneda
Future Research Institute Incorporated]
・ Development of local economies around Haneda Airportand promotion of culture and arts
・ Matters related to initiatives aimed at achieving the SDGs
・ Digitalization of services to Haneda Airport users, etc.
Scheduled to separately conclude basic business allianceagreement withHaneda Future Research Institute
→ customer marketing, development of new businessdomains, etc.

Ｂ. [Provision of Maekyu services to Haneda Airport facility employees]
Use of “Maekyu” services and trial implementation for theuse of LaLaPay in airport facilities③ CVC funds formation [Structured on May 20, 2021]
Create funds through collaboration with startups and large
corporations

Kiraboshi Consulting Co., Ltd.
Formation of CVC fund

Linking LaLaPay with Haneda Airport apps
Vitalization of airport terminals

Large corporations

Employees and usersof Haneda Airport

Contribute to open innovation /regional revitalization business byconnecting startups with large corporations

LaLaPay*
Digital Bank

Startups

MedicalMarketing support throughaccumulation and analysis of digital data

Entertainment,
art, culture

SportsContribute to regional vitalization
through promotion of sports

Support in solving social issues with
SDGs in mind

Initiatives for Strengthening Management Base

Reform of management base to enhancecustomer convenience and efficiency

Goals of the Tokyo-based Platform

Tokyo Kiraboshi Financial Group

Growth Strategy

Administration(Tokyo, Kawasaki, etc.)* LaLaPay: Name of digital money
functions, etc., provided by
Kiraboshi Tech, Inc.

│Tokyo Kiraboshi Financial Group, Inc.│ 14

Corporate Data

Features

S

SocialInitiatives for Strengthening Management BaseTokyo Kiraboshi Financial Group SDG Declaration
The Tokyo Kiraboshi Financial Group aims tobe “a comprehensive service business that isa l s o s t ro n g i n f i n a n ce.” B a s e d o n i t s
management philosophy of “to be a financialgroup for small and medium-sized enterprisecustomers and individual customers in theTokyo metropolitan area that will contributeto the development of local communities
through comprehensive financial services,”the Group is working, through its corporate
activities, on initiatives related to the SDGs
adopted by the United Nations summit, andseeking to realize a sustainable society andto create shared societal value.

E

Environment

Local
communities

SocialGovernance

GovernanceSupport aimed at corporate
growth and improvement of value

Provision of medium- to long-term capital throughequity, mezzanine and capital subordinated loans

Satisfaction+ Reliability

Creation of new
businesses and services

Dialogue

Seniors

Corporate
ownersFD
FD: Fiduciary duty

Sustainable local communities

Ties with the community leading
to the ﬁrst call are important

Involvement in environmental
protection and local sports

A management model that perceives the creation of economic value and social value to be connected

S

Development of interdependence and a senseof unity with local communities is important

Creation of business opportunities

Society
Shareholders
and investors

G

G

Employees

S

Governance2. Contributing to local communities

5. Dialogue with shareholders
and investors

While deepening our dialogue with customers and thoseliving in local communities, we take initiatives to create a safe
and abundant society in which everybody can live securely
and healthily, and work to realize a sustainable society.

In order to achieve sustainable
development for the Company
and enhance shareholder
value, as well as raise thetransparency and objectivity ofmanagement, we are striving
to assist in the developmentof local communities throughs t re n g t h e n i n g s t r u c t u re s
associated with corporate
governance and working toensure compliance.

S

Social

3. Creation of shared value with the customer
By utilizing financing and various kinds of funds based on businessfeasibility evaluations, as well as providing sophisticated consulting
functions in such areas as business start-up, the expansion of sales
channels, and business succession that match the company’s
stage of life, we will create shared value with the customer, andcontribute to the sustainable growth of the local economy.

E

Environment

4. Employee’s work style reform and promotion of diversity
In addition to promoting Kenko Keiei (health and productivity
management*) by encouraging a work-life balance, the Groupis taking steps that include supporting the contribution of
women, and creating an environment in which all employees,
irrespective of gender or age, can feel satisfaction in theirwork, thus facilitating the development of diverse human *“Kenko Keiei®” is a registered trademark of Workshop forresources and the realization of diverse work styles.
the Management of Health on Company and Employee.

Development of a sustainable society
15 │Tokyo Kiraboshi Financial Group, Inc.│

Initiatives for Strengthening Management BaseG

Resolution of issues

Support aimed at sustaining social
infrastructure such as medical institutions
Support aimed atbeing carbon neutral

Management
philosophy

E

Tokyo-based
platform owner

EconomyG

Governance│Tokyo Kiraboshi Financial Group, Inc.│ 16

Corporate Data

Society

Environment

Environment

Connecting to the next generation

ESG investment

S

E

Support aimed at start-ups, businesssuccession and restructuring

Customer

Growth Strategy

E

Kiraboshi SDGs

Environment

S

S
G

Image of SDG Initiatives

Customers’initiatives

1. Environmental protection
In order to leave to those people living in local communities, and to the children who will be the bearers of the next generation,a future environment that enables a safe and abundant future lifestyle and one in which they can live securely and healthily,
the Group is taking measures t o conser v e and pro t ec t the environment that take into account climate change and global
warming, and striving to help realize a sustainable society by means of its local environmental activities and financial services.

Environmental
protection

Funding support for companies that are necessary for sustainablelocal communities from the perspective of ESG investment

Tokyo Kiraboshi Financial GroupESG／SDGs Initiatives

Initiatives for Strengthening Management BaseSupport for companies giving consideration
to climate change and the environment,
provision of products and services
ESG

Key initiatives

seek to deploy funds into environmental businesses andbusinesses that generate environmental improvements, etc.
The Group invested in “Green Jointly Operated DesignatedMoney Trust” structured by Sumitomo Mitsui Trust Bank in

SDG targets

September 2018, and “Tokyo Green Bonds,” which are

・ TCFD・ Green bond ﬁnance・ Promotion of biodiversity
・ Provision of environmentally aware products and services
・ Environmentally friendly design

environmental bonds issued by Tokyo Metropolitan

Government for the first time as a local government, for the Response to climate change
second time in October 2020 following October 2017.

Environmentally aware branch equipment
Initiatives to Address TCFD (Task Force on Climate-related Financial Disclosures)
In February 2021, the Group voiced support for the TCFD* recommendations. In addition to disclosing information inaccordance with the recommendations, we will engage in CO₂ reductions, etc. aimed at mitigating climate change risk.
* TCFD is a taskforce on disclosure of climate-related financial information led by the private sector established by the FSB (Financial Stability Board),
and it recommends companies to disclose information on risks and opportunities related to climate change, etc.

Governance

Strategy

RiskManagement⃝In the Medium-Term Business Plan, “environment (response to global warming and climate change)”
is established as a priority issue (materiality) in the Group’s SDGs.
Moving forward, we will engage in initiatives to mitigate climate change risk through the provision of financial services with high added value.
⃝We will endeavor to analyze the impact of climate change on opportunities and risks.
> Opportunities: W
 e will engage in support for capital investment, etc. by customers for the transition to a low-carbon society.
> Risks: We recognize risks related to climate change to include physical risks (impact of climate change on natural disasters,etc.) and transition risks (regulations, etc. associated with the transition to a low-carbon society)⃝In the future, we will consider efforts related to evaluation of risks and opportunities based on
multiple scenarios that may have an impact on the company’s management.
⃝We perceive climate change risk to be a significant risk, and will engage in the creation of a system enabling management
within a framework of integrated risk management based on consideration of the degree of impact and probability.
⃝We recognize risks arising from climate change, and will endeavor to minimize the increase in coal-related assets and the manufacturing of inhumane
weapons based on consideration of policies concerning coal-fired power generation, palm oil farm development, logging, and other businesses, etc.
that have an impact on the environment, climate change and the ecosystem, as well as the manufacturing of inhumane weapons such as cluster bombs.
⃝Reduction targets and results for CO₂ emissions derived from the use of electric power in Kiraboshi Bank’s
domestic business locations (periodic reporting standards under the Act on the Rational Use of Energy)> CO₂ emission reduction target
46% reduction by 2030 compared with FY2013
18,627■Power usage (thousand kwh)
■CO₂ emissions (t-CO₂)

Indicators and
Goals

Reduction rate (%)

45.4
39.2

cre a te e nv i ro n m e n t a l ly f ri e n d ly b ra n ch e s byWith regard to the Kiraboshi Bank head office andintroducing environmental facilities such as solar
power generation, use of rainwater and creation ofrooftop greenery in the headquarters building (andKiraboshi Bank head office), in addition to converting
efficient air conditioning in bank branches.
In addition, we are working on initiatives to counter
global warming through our business activities, suchas offering financial products

the Takinogawa branch (and central operations
center) that were constructed using materials from
Tama, the use of Tokyo forestr y resources asconstruction materials was appreciated by the
Tokyo Metropolitan Government, which certified theGroup under the “Tokyo Forest Action accreditation
system (recognition of CO₂ volume fixed by means ofbuildings, etc.)”

and ser vices that lead toenvironmental protection.

Kiraboshi Bank Takinogawa branch(and central operations center)
Headquarters building (andKiraboshi Bank head office)Kiraboshi Bank head
officeCooperating with “campaign for growing low pollen forests”
While contributing to the prevention of global warming, we will cooperate with “the campaign for growing low
pollen forests” through “term deposits for growing low pollen forests,” and activities for healthy forests. In
addition to working toward the spread of environmental protection activities through the handling of deposits,
we are making donations for “growing low pollen forests” every year. Furthermore, we are participating in forest

31.4
14,037

With the aim of reducing CO₂, we are proceeding to

Certified under the “Tokyo Forest
Action” accreditation systemlighting in branches to LED and installing highly⃝The Medium-Term Business Plan emphasizing harmony between environmental protection and corporate
activity began in April 2021. We will proceed with the discussion of efforts implemented as a Group.
⃝The director in charge of the Business Strategy Division is the “Chief Sustainability Officer.”In the future, we will periodically report to the Management Meeting and the Board of Directors on efforts related to climate change.

Protection of the natural environment (setting up parks)(installation of high -tide (Photo credit: courtesy of Tokyo Metropolitan Government)
defense facilities)

creation of forests in Hachioji, Tokyo, as “Corporate Forests - Kiraboshi Forest.”
12,902

9,863
6,761

5,993

12,772
5,384

Handling of environmentally aware products, services, etc.
Kiraboshi Bank handles environmentally friendly products and services such as “Nikko Eco Fund (an internet-only
product)” in addition to working with external organizations to engage in environmentally friendly initiatives. In

FY2013

FY2018FY2019FY2020⃝We will proceed to establish and examine various data to establish targets based on the Paris Agreement.
⃝We have been engaged in the reduction of greenhouse gas emissions until now, and in addition to continuing the transition to LED lighting
and proceeding to switch to environmentally friendly business vehicles, we will proceed to consider switching to renewable energy sources.
* All excerpts from figures reported based on the Act on the Rational Use of Energy.
* The figures for FY2013 are a combination of the results for the former Tokyo Tomin Bank, Limited and the former Yachiyo Bank, Limited prior to the merger.

17 │Tokyo Kiraboshi Financial Group, Inc.│

the initiative utilizing the J-Credit Scheme,* the Group supports the resolution of regional issues such asenvironmental protection and child care support by using credit from external organizations such as CO₂ reduced
through the introduction of energy-saving equipment, and donating the proceeds to local governments’operations related to SDGs.
* A scheme certified by Japan as a system of “credits” for the amount of CO₂ and other greenhouse gas emissions reduced and absorbed throughthe introduction of energysaving devices, forestry management, and other initiatives.

│Tokyo Kiraboshi Financial Group, Inc.│ 18

Corporate Data

Relationship between the Mediumterm Business Plan and ESG Initiatives

a global scale, there has been an expansion in green investing initiatives that

Initiatives for Strengthening Management BaseIn order to leave to those people living in local communities, and to the children who will be the bearers of the next generation,a future environment that enables a safe and abundant future lifestyle and one in which they can live securely and healthily, theGroup is taking measures to conserve and protect the environment that take into account climate change and global warming,and striving to help realize a sustainable society by means of its local environmental activities and financial services.

Growth Strategy

With interest in Environmental, Social and Governance (ESG) investing rising onTokyo Kiraboshi Financial Group

Investments in Green Bonds/Green Finance

Environmental Initiatives

Initiatives for Strengthening Management BaseCommunication with Stakeholders

Ronald McDonald House is operated by Ronald McDonald House Charities
Japan, and offers accommodation to lighten the economic and emotional

The Group aims to be a comprehensive financial group that is truly loved by all stakeholders suchburden of seriously ill children and their families. The Group makes

as customers, shareholders and members of the community, and will strive to enhance appropriate

donations to this charity every year. We will continue with this support tocommunication with and disclosure to stakeholders while also contributing to the sustainable
development of society.

Ronald McDonald House Charities Japan

Relationship between the
M ediu m - term B usiness Pl an
and ESG Initiatives
External partnerships
Creation of new value through thepromotion of sports
Human resources development
and self-improvement
E

S

G

Key initiatives

enable children with a future to be supported by their families while they
are cured of their illnesses, allowing them to grow strong and healthy.

SDG targets

・Promotion of sports
・Collaboration between industry
and academia
・Investment in social bonds andsustainability bonds
・Flexible work styles
・H o l d i n g b ri e f i n g s e s si o n s fo r
investors
・Further strengthening governance

Cooperating with blood donations

Tokyo Kiraboshi Financial Group

Donations to Ronald McDonald House

As part of our activities to support local communities, we also cooperatewith blood donation drives. By continuing these activities so as to help savemore lives, we cooperate with the blood donation centers of the TokyoJapan Red Cross to enable us to save the precious lives of those who needendeavors into the future.
（Cancelled due to the spread of COVID-19 in FY 2020）

Contributing to local communities
While deepening our dialogue with customers and those living in local communities, we take initiatives to create asafe and abundant society in which everybody can live securely and healthily, and work to realize a sustainable
society.

⃝Conclusion of “Basic Agreement on Comprehensive“JFA Ko ko ro Proje c t,” we su p p o r t th e “ D rea m Cl a ss”
program in which “ D ream -Teachers,” whose members
include currently active athletes and former alumni of the
project, and who convey “ the importance of having a
dream” mostly to audiences consisting mainly of 5th-grade
elementary school children.
* The 2020 “Dream Class” was held online.
Dream-Teacher: Hanae Ito (Swimming)

Cooperation with UNICEF fund-raising activities, etc.
The Group runs “a foreign coins collection program,” and the donations
thus collected are put to use in support activities for children conductedby UNICEF in 150 or more countries and regions.
Also, within the Group, as part of our everyday volunteer activities wecollect used stamps and cards and donate them to the Minato Council

Signing ceremony⃝Nihon University College of Art
In June 2020, Kiraboshi Bank signed a “Cooperation Agreement” with the
Nihon University College of Art for the purpose of revitalizing the local
economy and developing local communities as well as to contribute to theevolution of arts education and research.
As part of these efforts, advertising activities were carried out by jointly
producing a six-second YouTube commercial (bumper commercial) on thetheme of the “Maekyu” service with students of Nihon University College of
Art to raise awareness of the service.

* The “Maekyu” service is a welfare benefits service enabling money to be received before pay

Maekyu YouTube advertisement

day to the extent one has worked.
* At present, the distribution of the advertisement has ended.

Corporate Data

Through sponsorship of the Japan Football Association’s

In March 2021, a “Basic Agreement on Comprehensive
Collaboration” was concluded with Chuo University forexchanging and utilizing personnel and intellectual resources
to cooperate with each other in areas such as education andresearch for the purpose of contributing to the developmentof society. We will continue with initiatives such as hosting
lectures provided through donations in the future.

Initiatives for Strengthening Management Base

Collaboration” with Chuo University

Educational support for students and childrenof Social Welfare.

Collaboration between industry and academia⃝Tokyo Metropolitan University
As part of the “Agreement to Support SMEs Through Academic-Industrial
Collaboration” initiative signed bet ween the Group and Tokyo
Metropolitan University in August 2017, the “TMU Premium College”
lectures through donations aimed at the premium generation aged 50
or higher were held. In FY2020, the lectures were held a total of fivetimes from October 2020, with officers from the Group providing lectureson the latest financial trends and new trends such as FinTech.
Tokyo Metropolitan University

19 │Tokyo Kiraboshi Financial Group, Inc.│

Growth Strategy

blood transfusions due to illness or injury, and will carry on these│Tokyo Kiraboshi Financial Group, Inc.│ 20

Responding to COVID-19

Creation of shared value with the customer

We are providing ongoing support such as cash flow

By providing sophisticated consulting functions in such areas as business support, business start-up, theexpansion of sales channels, and business succession that match the company’s stage of life, we will createshared value with the customer, and contribute to the sustainable growth of the local economy.

the spread of COVID-19. In addition to engaging in theInvestment in social bonds and sustainability bonds

prevention of the spread of COVID-19 with the greatest

The Group is engaged in SDGs management incorporating the ESG perspectives of Environment, Social andGovernance.
In January 2021, we invested in the “Social Bonds” issued by the Japan Student Services Organization, and in February
and May 2021, we invested in the “Sustainability Bonds” issued by the Japan Railway Construction, Transport andTechnology Agency.

consideration for the health and safety of customers
a n d e m p loye es , we w ill co nti n u e to p rovi d eappropriate consulting functions as a local financialgroup.

Supporting stakeholders with all our strength to overcome the global crisis
Creation of shared value with the customer

Kiraboshi SDGs Private Placement Bonds⃝ Continued operation of all branches
and ATMs⃝ Flexible response to loan
modifications, etc.
⃝ Loan modification fee waivers
Corporate

16,802

Loan execution amount(guarantee associationloans included therein)(guarantee associationloans included therein)

15,949(14,582)¥462.5 billiion(¥388.1 billion)

Number of loan modification applications

Number of loan modifications executed

5,052

4,361

(As of March 31, 2021)

Kiraboshi support package⃝Effectively interest-free loans,
unsecured loans

Funding and⃝Original COVID-19 relief fundrevision of
repayment terms ⃝Cash flow consultation(funding, modification of terms, etc.)

Subsidies/grants ⃝Ministry of Health, Labour and Welfare(information and ⃝Ministry of Economy, Trade and Industry⃝Tokyo, Kanagawa, Saitama, Chiba, etc.
guidance)

Support ofmainstay
operations

Number of loans executed

Number of loan
applications⃝ Strengthening of cash flow support
Individuals

Social bonds are bonds issued for procuring funding for projects addressing social issues.
Sustainability Bonds are bonds for which the use of the funds (1) has the effect of improving theenvironment (green) and (2) contributes to the resolution of social issues.

Enhancement of financial support and consulting functions
February 2020: Started offering assistance in applying for emergency
lending program, set up loan consultation desks
March:

Established COVID-19 Kiraboshi Fund (applicantsreceive responses in principle within 3 businessdays) and loan modification fee waivers related
to business feasibility financing

June: Started accepting consultation on funding problems
via the Internet around the clock all year

⃝New establishment of Finance Management Division
Management Support Group, strengthening ofmanagement support for customers subject to an impact
on business activities including the impact of COVID-19

August: Established A&KC Mezzanine Finance No. 1 Investment
Limited Partnership (Yume Yorisoi Fund 1)⃝Cost reduction (rent, electricity,communication, other expenses)

November: Establishment of Kiraboshi Capital Tokyo
Sparkle Investment Limited Partnership⃝Accounts receivables guarantee

December: Commenced handling of “Kiraboshi Joint Financing
for Strengthening Management to Address COVID-19”
joint financing with Japan Finance Corporation⃝Development of business plan, management plan

⃝HR support⃝Subcontracting receivables protection(construction industry)⃝ICT implementation support⃝Equipment procurement / leasing

In June 2020, we started handling “Kiraboshi SDGs Private Placement
Bonds” as a way to support the expansion of the adoption of SDGs
and the resolution of environmental and social issues. The products
are products for which Kiraboshi Bank donates an amount equivalent
to 0.2% of the issue amount to groups engaged in SDGs (in principle,
within the business area of Kiraboshi Bank) chosen by the issuing
companies.

Number of issues handled

98

Issue amount¥9.0
billion29¥2.5 billion
September 30, 2020

March 31, 2021

Supporting business start-ups
The Group aims to support founders and entrepreneurs with the aim of “making Kiraboshi Bank the natural
partner for start-ups.” In addition to establishing a “Start-up Support Office” in Kiraboshi Bank, we are working
with Group companies such as Kiraboshi Capital and Kiraboshi Consulting in an effort to meet the various needsof customer in a consulting system utilizing the combined strength of the Group.
In November 2020, the “KicSpace” community space on the first floor of the Kiraboshi Bank head office was used
to hold a business plan brush-up session for venture companies.
In addition, following on from the previous year, we continued to provide support such as holding a seminar
supporting start-ups by women*1 jointly held with the Development Bank of Japan, and also supporting theTokyo Venture Championship, a start-up pitch contest*2 backed by the Tokyo Metropolitan Government.

*1 The seminar was held online in FY2020.
*2 An event in which venture companies make a short presentation on the business plan and future potential of their own companies.

March 2021: Established A&KC Medical No. 1 Investment Limited
Partnership, a dedicated fund for medical corporations, etc.

⃝ Promotion of telework split operations⃝ Granting special paid leave⃝ Thorough infection prevention in headquarters
and branches: Installation of acrylic partitions, PCR
testing, introduction of AI temperature measurement
solution (head office)

21 │Tokyo Kiraboshi Financial Group, Inc.│

Corporate Data

*We respond to inquiries on diverse subjects including
collaboration with administrative bodies and public financial
institutions, and use of directed credit programs and subsidies.

Work style reform

Growth Strategy

co nsult ati o n d esk fo r custo m e rs af fe c te d by

Initiatives for Strengthening Management Baseassistance and the establishment of a financing

Tokyo Kiraboshi Financial Group

Initiatives for Strengthening Management BaseContributing to local communities⃝ Support for and donation to the J-Coin Fund (¥1
million)⃝ Support for and donation to Tokyo Metropolitan
Hospital Association (¥10 million)⃝ Management support and provision of funding to
medical and social welfare corporations, etc.

Seminar supporting start-ups by womenTokyo Venture Championship 2020

│Tokyo Kiraboshi Financial Group, Inc.│ 22

Employees’ Work Style Reform and Promotion of Diversity

Dialogue with shareholders and investors

In addition to promoting Kenko Keiei (health and productivity management) by encouraging a work-life balance,
the Group is taking steps that include supporting the contribution of women, and creating an environment inwhich all employees, irrespective of gender or age, can feel satisfaction in their work, thus facilitating thedevelopment of diverse human resources and the realization of diverse work styles.

In order to achieve sustainable development for the Company and enhance shareholder value, as well as raise thetransparency and objectivity of management, we are striving to assist in the development of local communities
through strengthening structures associated with corporate governance and working to ensure compliance.

Realizing ﬂexible work styles

Information Disclosure Policy

The Company has positioned “work style reform” as a key issue in management and is realizing flexible work styles
not constrained by time or place such as promoting telework (working from home).
In addition, the “SDGs Promotion Team” established in October 2020 is engaged in a variety of measures leading to
the achievement of SDGs, such as initiatives to promote diversity including promoting active participation by womenand hiring diverse human resources regardless of nationality.

Under our management philosophy, that is “to be a financial group for small and medium-sized enterprise customers
and individual customers in the Tokyo metropolitan area that will contribute to the development of local communities
through comprehensive financial services,” the Group is committed to making timely and appropriate disclosure andprovision of information that is easy to understand, not only on financial information but also on non-financial
information such as management strategies and issues and information on risks and governance, in an aim to win
more trust and reputation from our customers, shareholders, and local communities, etc.
The Group has established the “Information Disclosure Policy” for the timely and appropriate disclosure and provisionof information that is easy to understand to stakeholders, and strives to disclose information in a fair and equitablemanner.

Tokyo Kiraboshi Financial Group

Initiatives for Strengthening Management Base

Enhancing systems for achieving work-lifebalance⃝ Telework (work from home) trial⃝ Flex time trial⃝ Shortened working hours system⃝ Working hours shift system

Support for users of various systems⃝ Encouraging male employees to take childcare
leave⃝ Holding workshops and exchanges for people
returning to the workplace after childcare leave⃝ Creation of a balance support guidebook(childcare and nursing care)⃝ Holding nursing care seminars

Kiraboshi Bank obtained the highest Stage 3 level ofthe “Eruboshi” certification from the Minister of Health,Labour and Welfare as an excellent company based on
the Act on Promotion of Women’s Participation andAdvancement in the Workplace.

Health and productivity management⃝ Introducing a health promotion app⃝ Reforming awareness to resolve long
working hours⃝ Introducing 1-on-1 meetings

Respect for diverse human resources⃝ “Visualization” of human resources using
a talent management system⃝ Promotion of active participation by women⃝ Employment of people with disabilities⃝ Utilization of human resources regardlessof nationality⃝ Intake of external human resources throughmid-career recruitment

Introducing mobile work
Promoting work from homeExpansion of flex time trial

Introducing 1-on-1 meetings
360-degree evaluation trial

Implementation of career support training for
personnel who wish to change occupations
Holding Meetups with Outside Directors

Supporting flexible work styles that are
uncoupled from time and place, such as
considering the adoption of mobile-working

Stimulating communication, assessing
diverse staff member skills, andproviding career design support

Supporting autonomous career building,creating a workplace enabling womento actively participate*The results briefing for investors for the fiscal year ended March 31, 2021, was held via video stream.

Video stream of results briefing for institutional investors

Capital policy
The basic capital policy of the Company is tosecure a sufficient level of net assets as a holding
company of regional financial institutions in orderto help its subsidiaries perform their functions toprovide the smooth supply of funds, and also to
strive to improve capital efficiency by improving
profitability and management efficiency.
In addition, we regard the return of profits toshareholders as one of the important management
measures, and strive to ensure financial soundness
by maintaining appropriate internal reserves, andwe will continue to pay stable dividends.

Financial targets set in the new Medium-Term Business Plan
Maintainsoundness

Maintain soundness while accumulating risk assets
Consolidated capital adequacy ratio of 8% or more

Strategicrisk taking

Improve Group earnings based on RAF
ROE of approx. 6%

Shareholder
returns

Improvement of returns to meet expected levels
Total return of 20-30%

Total shareholder returns and comparative index trends for the past five years
The trends in “total shareholder returns” over the past five years are compared below to the total returns in the
TOPIX Sector Index (Banking industry). These “total shareholder returns” are the ratio of the revenue received due tothe share investment (dividends + capital gains) divided by the investment amount (share price) which are calculated
as shown below by dividing the revenue for each period by the share price from five periods before.

150.0%

Total shareholder
return100.0%

Comparative index:
TOPIX Sector Index(Banking industry)

50.0%

0.0%
March 201623 │Tokyo Kiraboshi Financial Group, Inc.│

March 2017

March 2018

March 2019

March 2020

March 2021

│Tokyo Kiraboshi Financial Group, Inc.│ 24

Initiatives for Strengthening Management BaseTokyo Kiraboshi Financial Group and Kiraboshi Bank wererecognized for the first time as 2021 Certified Health &Productivity Management Outstanding Organizations(Large Enterprise Category) jointly chosen by the Ministryof Economy, Trade and Industry and Nippon Kenko Kaigi.

Corporate Data

Certified “Eruboshi” mark (Stage 3 level)

Growth Strategy

Holding briefing sessions for investors
The Group is engaged in IR activities such as holding briefing sessions for
institutional investors and private investors so that stakeholders including ourcustomers, local communities, shareholders understand the management status
and other aspects of the Group.

Initiatives for Strengthening Management Base ─Corporate Governance ─

The Company is a company with Audit & Supervisory Board. The
Board of Directors supervises the execution of duties by Directors,
and Audit & Supervisory Board Members and the Audit &Supervisory Board audit the execution of duties by Directors. The
Company believes that the appropriateness of management
supervision and audit functions as well as a system for efficientbusiness execution are ensured by effectively utilizing themanagement supervisory function realized by the appointment ofhighly independent Outside Directors and Outside Audit &Supervisory Board Members and the audit function performed byAudit & Supervisory Board Members and the Audit & Supervisory
Board, and by enhancing the effectiveness of corporate governance.

■ Chart of corporate governance system（as of July 1, 2021）
General Shareholders Meeting
Appointment / Dismissal

Audit & Supervisory Board

Appointment / Dismissal
Close cooperation

Audit & Supervisory Board Members

Appointment / Dismissal

Accounting Auditor

Audit report

Audit & Supervisory Board Oﬃce
(Back row from left)
Satoru Nobeta,
Yukio Kasai, Full-time Toru Narata, Full-time Kayo Todo, Outside Nobuyuki Yasuda, Shoji Nishio,
Outside Director
Senior Managing Director Audit & Supervisory Audit & Supervisory Audit & Supervisory Director
Board Member
Board Member
Board Member

Nobuko Inaba, Outside
Audit & Supervisory
Board Member

Audit

Board of Directors

Audit

Close cooperation

Audit report

Accounting audit

Nomination / Remuneration Committee

Tokyo Kiraboshi Financial Group

Outline of corporate governance system

Close cooperation

Growth Strategy

Initiatives to Strengthen Corporate Governance(Front row from left)
Hidenori Tsunehisa,
Deputy President

Committees

Management Meeting

Basic approaches to corporate governance
The Company considers corporate governance to beestablished the Basic Policy on Corporate Governance.

one of the most important management issues, andIn order to put in place the “system that ensuresutilizes the knowledge of outside officers and external

properness of business operations” of the Company

experts to strengthen the Group business management

and Group companies pursuant to the Companies

system and supervisory functions while enhancing

Act and the Ordinance for Enforcement of thecorporate governance functions to make transparent,

Companies Ac t, the Board of Direc tors of thefair, prompt, and decisive decisions as it conductsCompany has resolved the“ Basic Internal Control

Internal Audit Division

Compliance Committee
Risk Management Committee

Reporting / Presenting

ALM Committees

Internal audit

Corporate Planning Division

Secretariat Oﬃce

Risk Management Division

Policy” and endeavors to improve its effectiveness.
コーポレート・ガバナンスに関する基本方針、
内部統制システムの整備の状況

business and strives to sustainably increase corporate

Business Strategy Division

Digital Strategy DivisionPartnership Promotion DivisionTokyo Metropolitan Government
Collaboration Promotion Oﬃce

Group Strategy Oﬃcevalu e. Fu r t h e rm o re, inte n din g to e m b o d y o u r

https://www.tokyo-kiraboshifg.co.jp/about/governance.html

Public Sector Collaboration
Promotion Oﬃce

management philosophy and the Group’s vision, we

Discussion/Reporting

Outline of corporate governance system
Organization form
Company with Audit &Supervisory Board

Executive remuneration structure
Fixed remuneration
Performance-linked remuneration(short-term performance)
Performance-linked remuneration(medium- to long-term
performance)

25 │Tokyo Kiraboshi Financial Group, Inc.│

Directors and Boardof Directors

3outside

Audit & Supervisory Board Member
and Audit & Supervisory Board

Nomination/Remuneration
Committee

1inside2outside

membermembers

members7

Directors

4

insidemembers

Chairperson of the Boardof Directors…………President

4Audit &Supervisory Board
Members3

2insidemembers

Directors

2outside

members

Chairperson ………………
Appointed from among Outside Directors

Kiraboshi Bank, Ltd.

Tokyo Kiraboshi
Lease, Inc.

Kiraboshi
System, Inc.

Kiraboshi
Kiraboshi JCB Co., Ltd.
Consulting Co., Ltd.

Initiatives for Strengthening Management Base

Hisanobu Watanabe, Shuya Nomura,President
Outside Director

Approval/Instructions

Kiraboshi
Capital Co., Ltd.

Kiraboshi
Kiraboshi
KiraboshiLife Design
Digital Bank
business oﬃce
Securities Co., Ltd. Preparatory Co., Ltd. service, Inc.

Subsidiaries, etc.
●Kiraboshi Credit Guarantee Co., Ltd. ●Yachiyo Credit Guarantee Co., Ltd.
●Kiraboshi Business Service Co., Ltd. ●Kiraboshi Tech, Inc.

●Kiraboshi Business Consulting Shanghai Co., Ltd ●KIRABOSHI BUSINESS CONSULTING VIETNAM Co., Ltd.

│Tokyo Kiraboshi Financial Group, Inc.│ 26

Corporate Data

Yuki Takahashi,
Outside Director

Audit & Supervisory Board Members

Candidates for Audit & Supervisory Board Members are
determined after deliberation by the Company’s Board of
Directors with the consent of the Company’s Audit &Supervisory Board.

Outside Directors and Outside Audit & Supervisory Board Members

In ad ditio n to th e ab ove stan dards , th e following“standards of independence regarding outside officers” areestablished for and govern the appointment of Outside
D ire c to rs a n d O ut sid e Au dit & Su p e r viso r y B o a rd
Members based on the functions and roles that outside
officers should have in corporate governance.

Initiative issues

Business
operation

Evaluation ofbusiness feasibility

Improvements

PDCA cycle

Nomination/Remuneration CommitteeStandards of independence regarding outside officers
The Company and its subsidiary banks (hereinafter the “Group”)
determine independence regarding candidates for Outside
Director and Outside Audit & Supervisory Board Member
based on the following standards.
1. （1）The person is not an Executive Director, Executive
Officer, or a manager or other employee (collectively
hereinafter the “Business Executors, etc.”) of the Group,
and was not a Business Executor, etc., of the Group
within 10 years prior to appointment.
H o w e v e r, f o r c a n d i d a t e s f o r O u t s i d e A u d i t &Supervisory Board Member, the requirement of nothaving been a Non-executive Director (Note 1) of theGroup within 10 years prior to appointment is added.
（2）For candidates for Outside Director that were Nonexecutive Directors or Audit & Supervisory Board
M embers of the Group within 10 years prior toappointment, these persons must not have been a
Business Executors, etc., of the Group within 10 years
prior to appointment to that position.
For candidates for Outside Audit & Supervisory Board
Member that were Audit & Supervisory Board Membersof the Group within 10 years prior to appointment,these persons must not have been Business Executors,
etc., or Non-executive Directors of the Group within 10
years prior to appointment to that position.
（3）The party is not a spouse or a relative to within thesecond degree of an officer, etc. (Note 2), manager orother important employee (excluding those who are
officers, etc.) of the Group.
2. The person is not a major shareholder (Note 3) of theCompany or an officer, etc., or employee (excluding those
who are officers, etc.) of a company of which the Group isa major shareholder.
3. （1）The person does not hold the Group as a majortransaction partner (Note 4) and is not the parent
company or a significant subsidiary, and if that person
is a company, is not a Business Executor, etc., of said
company and was not a Business Executor, etc., within
the past three years.
（2）The person is not a major transaction partner of theGroup and is not the parent company or a significant
subsidiary, and if that person is a company, is not a

Business Executor, etc., of said company and was not a
Business Executor, etc., within the past three years.
（3）The person is not an employee, etc., of an organizationthat receives donations, etc., over a certain amount (anaverage of ¥10 million per annum for the past three
years or 30% or more of average annual expenses ofsaid organization, whichever is higher) from the Group.
4. The person is not an officer, etc., of a company, parent
company of said company, or subsidiary of said company
that receives officers, etc., from the Group.
5. The person is not the Accounting Auditor of the Group oran employee, etc., of said Accounting Auditor and was
not responsible for the audit operations of the Group
within the past three years as said employee, etc.
6. The person is an attorney, certified public accountant, orother consultant, etc., who has not received an average of¥10 million or more per annum for the past three years
aside from officer remuneration in cash or other property
as profit from the Group. Additionally, the person is not an
employee, etc., of an advisory firm such as a legal office,etc., that holds the Group as a major transaction partner(an advisory firm that received payment from the Group of
2% or more of its consolidated net sales on average overthe past three fiscal years).
7. The person is not a person with which a constant, essential
conflict of interest with general shareholders of the
Co m p a ny may a ris e fo r rea s o ns o t h e r t ha n t h o s e
considered above.
(Note 1) A “Non-executive Director” refers to a Director that is
not an Executive Director.
(Note 2) A n “officer, etc.,” refers to a Director (including an
Outside Director), Audit & Supervisory Board Member(including an Outside Audit & Supervisory Board
Member), Executive Officer, Counselor, and Advisor.
(Note 3) A “major shareholder” is a person or company, etc.,that directly or indirectly possesses voting rights equal
to 10% or more of total voting rights as of the end of
the most recent fiscal year.
 “major transaction partner” is determined on the(Note 4) A
standard of 2% or more of annual consolidated net
sales (annual consolidated ordinary revenue for theCompany) as of the end of the most recent fiscal year.

Business execution and supervisory function
Directors and Board of Directors⃝Support system for Outside Directors (Outside Audit & Supervisory Board Members)

The Board of Directors consists of seven Directors(including three Outside Directors). The Board of Directors
has a system in place that enables the holding of one
meeting in principle each month and other extraordinary
meetings whenever the need arises in order to decide
important matters such as management policies andstrategies and to supervise the execution of duties byDirectors through such measures as receiving reports on
the status of business execution and other importantmatters.

A support system has been established for Outside
D i re c to rs by p rovi d i n g a d va n ce ex p l a nati o ns a n d
supplementary materials on important proposals for the
Board of Directors. Furthermore, Audit & Supervisory
Board Member assistants are assigned to assist the duties
of Audit & Supervisory Board Members as support for
Outside Audit & Supervisory Board Members, and a
suppor t system has been established by providing
advance explanations and supplementary materials, etc.
as needed for important proposals for the Board of
Directors.

27 │Tokyo Kiraboshi Financial Group, Inc.│The Company has voluntarily established the Nomination/
Remuneration Committee as an advisory body with theintent of securing objectivity and transparency regarding
personnel matters and remuneration of Directors. The
Nomination/Remuneration Committee consists of four
Directors or less (including at least two Outside Directors)

appointed by the resolution of the Board of Directors, andexamine personnel matters, appointment and dismissal of
directors of the Company and its subsidiary banks, as wellas the amount of remuneration for directors, and report
the results to each company’s Board of Directors.

Management MeetingU n d e r t h e B o a rd o f D i re c to r s , t h e C o m p a ny h a s
established the Management Meeting that consists of
Directors, and holds one meeting in principle each week
and other extraordinary meetings whenever the needarises. The Management Meeting decides importantmatters related to business execution other than those to
be resolved by the Board of Directors, and receives
reports on the status of business execution and otherimportant matters.

Committees

The Company has set up the “Compliance Committee,”th e “ Risk M a na gem ent Co m mit te e,” a n d th e “A L M
Committee” as the subordinate organizations to the
M a n a ge m e nt M e eti n g fo r ea ch a rea o f i m p o r t a nt
management issues, and has established a system that
increases expertise and agility. Each Committee meetsregularly and at any time whenever the need arises inaccordance with their respective rules.

Audit and supervisory functions
Audit & Supervisory Board Member and Audit & Supervisory Board
The Company’s Audit & Supervisory Board consists of two
full-time Audit & Supervisory Board Members and twopart-time Audit & Supervisory Board Members (Outside
Audit & Super visor y Board M embers). The Audit &Supervisory Board strives to strengthen the audit structure
by ensuring effective monitoring functions for Directors’decision-making and business execution. Each Audit &Supervisory Board Member conducts audits on executionof duties by Directors, internal control, and other related
matters by engaging in such activities as attending the
B oard of Direc to rs’ meetings and other imp o r tantmeetings, reviewing impor tant approval and otherdocuments, and conducting audits to each division of theCompany and investigations on subsidiaries, in accordancewith audit policies and plans established by the Audit &Supervisory Board. Audit & Supervisory Board Members
and the Audit & Supervisory Board are striving for effective
audits by maintaining close cooperation with the internal
audit departments, the Accounting Auditor, and otherrelevant parties, by exchanging opinions on priority audit
issues in regular meetings with Representative Directors
and other executives, or otherwise.
T he Co mpany has ele c te d o ne Substitute Au dit &Supervisory Board Member to prepare for the case where
the number of Audit & Supervisory Board Members falls
below the number required by laws and regulations. In

addition, two assistants to Audit & Supervisory Board
Members are assigned to support audits by Audit &Supervisory Board Members.

Growth Strategy

Candidates for director are considered by the Nomination/
Remuneration Committee and determined after being
reviewed by the Company’s Board of Directors based on
the results of the consideration.
Furthermore, Directors must have excellent personality,
knowledge and ability, extensive experience and highethical standards.

Furthermore, Audit & Supervisory Board Members musthave excellent personalit y, knowledge and abilit y,extensive experience and high ethical standards, inaddition to the necessary finance, accounting and legal
knowledge.

The Company implements Director self-evaluations withrespect to the effectiveness of the Board of Directors anddiscusses those results with the members of the Board of
Directors to improve the effectiveness of the entire Board.
In FY2020, the Group conducted a self-assessment in termsof “ensuring the explanation focused on the point andrisk,” “securing the time for deliberation on key issues on
the agenda,” and “monitoring on the Board of Directors’
views and requests or business challenges,” which wereidentified as issues in the previous year, put together the
results, and discussed it at the Board of Directors. Goingforward, we will strive to further improve the effectivenessof the Board of Directors and strengthen governance.

Internal audit

The Company’s internal audits have been conducted byth e Inte rnal Au dit D ivisio n , a divisio n esta blish e d
independently from the rest of the Group, based on the“Annual Internal Audit Plan” approved by the Board of
Directors. Results of the audit have been reported
regularly to the Board of Directors.
The Company has a system in place that enables theclose cooperation between audits by Audit & Supervisory
Board Members and accounting audits through attending
to regul ar m e eting s an d exchanging o pinio ns an dinformation as appropriate. The system also ensures thatinternal control departments provide explanations,
reports, and supplementary materials for audits by Audit& Supervisory Board Members at regular meetings, while
explanations and supplementary materials are provided
to accounting audits as necessary.

Accounting audit

The Group’s accounting audit is conducted by Ernst &Young ShinNihon LLC.

Initiatives for Strengthening Management Base

Directors⃝Initiative to improve the effectiveness of the Board of Directors

Officer Remuneration Structure
Basic approachT h e Co m p any ’s B o a rd of D ire c to rs views th eestablishment of an environment supporting soundmanagement and appropriate risk taking to be one of its
main roles and responsibilities, and endeavors to makeswift and bold decisions based on the approach of
creating a new type of urban regional bank.
Based on this approach, the remuneration of the Group’s
Directors (excluding Outside Directors) and executive
officers with whom delegation agreements have beenconcluded is structured to be made up as follows with fixed
remuneration (monthly remuneration) as base remuneration,in addition to a combination of share-based remuneration
using a share trust and cash remuneration to function as ahealthy incentive aimed at sustainable growth of the Group.

Types of remuneration⃝“ Fixed remuneration” (monthly remuneration): Baseremuneration⃝“Performance-linked remuneration”(1) “Cash remuneration”: Linked to short-term numericaltargets in the Medium-Term Business Plan
(2) “ Share-based remuneration”: Linked to mediumto long-term numerical targets in the MediumTerm Business Plan
*Outside Directors only receive monthly remuneration.
*Audit & Supervisory Board Members only receive monthly
remuneration, and are not subject to performance-linked
remuneration from the perspective of ensuring theneutrality and independence of Audit & Supervisory
Board Members.

│Tokyo Kiraboshi Financial Group, Inc.│ 28

Corporate Data

Approach to Appointment of Directors and Audit & Supervisory Board Members

Tokyo Kiraboshi Financial Group

Initiatives for Strengthening Management Base ─Corporate Governance ─Initiatives for Strengthening Management Base ─ Risk Management ─growth with a good balance of income, risk, andconducting business management and risk

capital. By monitoring the indicators periodically, themanagement. Introduction of R AF improves theGroup verifies the optimization of risk and return, atransparency of the management plans, enables abalance between capital efficiency and soundness,company to seek more profit opportunities andrisk prediction management, and an appropriate

conduct business management while controlling risks.

allocation of management resources.

Key indicators related to risk appetite

Main items considered

RORA

Optimization of risk and return, etc.

ROE

Capital efficiency, etc.

Capital adequacy ratio

Capital soundness, management of risk predictions, etc.

Income by department

Optimal allocation of management resources, etc.

■ Construction of overall RAF

Stress test of medium tolong-term simulation based

Stress test of risk capitalon the Medium-Term

allocation management

Business Plan(“backward-looking”)(“forward-looking”)■Verify allocation of management resources■Verify sustainability of the business model and monitor early warning risk signals

Status of putting in place the risk management system
The Group considers the risk management as one ofdis cuss es t h e est a b lish m e nt , revisi o n , a n d

the top priority management issues and, in order toabolishment of the Risk Management Regulations ore n s u re t h e s o u n d a n d a p p ro p r i a t e b u s i n e s sother regulations and considers formulation ofoperations of each Group company, endeavors topolicies for the development and establishment ofconduct suitable management of various risks as a

the Group’s risk management system. In addition, thewhole group under appropriate group businessGroup has established the Risk Management Divisionm a n a ge m e n t ( go v e r n a n ce). T h e G ro u p h a s

as the division supervising the risk management in theestablished the Risk Management Committee thatGroup and put in place the risk management system.

Group Basic Policy for Risk Management
1. Considering the risk management as the top priority issue in the management of the Group, the Group willrecognize the importance of risk management of the entire Group, including management of risks specific to thegroup system such as outline of the characteristics of various risks and the spread of risks. The Group will conduct
suitable management by establishing the management system for each type of risk.
2. The Group will manage subsidiaries so that the appropriate risk management is performed by them from the

29 │Tokyo Kiraboshi Financial Group, Inc.│

Kiraboshi Bank, Ltd.

Audit & Supervisory Board Members
Audit & Supervisory Board
Instructions /Management

Management Meeting

Risk Management Committee

Compliance Committee

Discussion /ReportingTokyo Kiraboshi Lease, Inc.
Kiraboshi System, Inc.
Kiraboshi Consulting Co., Ltd.
Kiraboshi JCB Co., Ltd.
Kiraboshi Capital Co., Ltd.

Risk Management Division (Headquaters CO)

Kiraboshi Life Design Securities Co., Ltd.
Kiraboshi Digital Bank Preparatory Co., Ltd.
Credit risk Market risk Liquidity risk

Operational
risk

Compliancerisk

Conductrisk

Integrated risk management
Risk appetite policy

viewpoint of ensuring soundness.

Board of Directors

Tokyo Kiraboshi Financial Groupbusiness strategies and financial plan, thereby

Integrated risk management within the Group means
to manage the risk in the Group as a whole, byintegrating the management of various risks held by
the Group companies, comprehensively identifying
risks specific to the group system that individualGroup companies alone cannot deal with, such as
the spread of risk within the Group, and comparingt h e ris k w i t h t h e G ro u p co m p a n i e s’ f i n a n cia lcapability (net assets).
The Group estimates the maximum potential loss
involving credit risk, market risk, Liquidity risk andoperational risk based on the measured amount of
risk. Then, in order to use limited capital effectively,
the Group allocates risk capital by using core capitalas allocation source and compares the capital withthe actual amount of risk to confirm that the Group
has not taken excessive risks in comparison with its
financial capabilities , thereby maintaining andensuring the soundness of management.

⃝Credit risk management
Credit risk means the risk of incurring losses due tod e crea s e d o r lost a ss et valu e c a us e d by adeterioration in the financial condition of the parties
to which the credit has been granted.
The Group strives to maintain the soundness of its
credit portfolio by avoiding concentration risk throughsuch measure as keeping the percentage of credit in
the total amount of credit below a certain level forlarge concentration risk that an excessive amount ofcredit is made available to a specific party or forindustry concentration risk that credit is concentrated
to a specific industry.

⃝Market risk management
Market risk means the risk of incurring losses due tofluctuations in the value of assets and liabilities and in
the amount of generated revenue as a result offluctuations in various market risk factors such as
interest rates, stock prices, and exchange rates. It isroughly divided into interest rate risk, price fluctuation
risk, and exchange rate risk.

Kiraboshi business oﬃce service, Inc.

The Group controls the amount of market risk to
avoid becoming excessive through such measures assetting limits for holdings and losses, monitoring thestatus of compliance, measuring the amount of risksuch as VaR, and comparing it with the allocated risk
capital.
I n a d d i t i o n , t h e G ro u p eva l u a te s m a r ke t ris kcomprehensively using the stress scenarios thatreflect events that could have a significant impact on
the Group or other means.

⃝Liquidity risk management
Liquidity risk is the risk of incurring losses caused bydifficulty in securing the necessary funds or being forced
to raise funds at a significantly higher interest rate thanusual due to a mismatch between investment andfunding periods or an unexpected outflow of funds(cash flow risk), and the risk of incurring losses caused
by inability to trade in the market or being forced to
trade at a significantly unfavorable price than usual due
to market turmoil or other factor (market liquidity risk).
The Group takes every possible measure to manage
liquidity risk through such measures as appropriately
managing the status of fund investment andprocurement, maintaining stable funding, and holding
above a cer tain amount of asset s that can beliquidated in a short period of time as current assets.

Growth Strategy

appetite for the purpose of achieving sustainable

Initiatives for Strengthening Management Base

Based on RAF, the Group compiled indicators for risk

for clarifying the risk appetite for the sake of achieving⃝Operational risk management
Operational risk means a wide range of risks related
to business operations in general, including the risk of
incurring losses caused by business process, activities
of officers or employees, improper or non-functional
systems, or external events.
The Group categorizes the operational risk according
to its characteristics into administrative risk, system
ris k , l e ga l ris k , o r o t h e r ris k . T h e G ro u p h a s
designated divisions responsible for each risk and an
integrated management division, and puts in place arisk management system that covers business
operations in general.

│Tokyo Kiraboshi Financial Group, Inc.│ 30

Corporate Data

The Risk Appetite Framework (RAF) is a framework■ Chart of risk management system

Subsidiaries, etc.

Trial implementation of Risk Appetite Framework

Initiatives for Strengthening Management Base ─ Compliance ─Compliance risk

Conduct risk

Status of putting in place the compliance system

Compliance risk is the risk of incurring severe damage
such as the Group losing social confidence due tofailure to comply with laws and regulations or “codes”
such as the Group’s management philosophy andpolicy, and regulations.
The Group has established a compliance program,and the management team takes the lead in an effort
to prevent the occurrence and recurrence of actual
risks and potential risks by taking steps such as
disseminating and providing education on compliancematters required for appropriate business operation,a n d m o n i to ri n g a n d co n t ro l l i n g t h e s t a t u s o festablishment and implementation.

The concept of conduct risk is where an officer or
employee acts contrary to social norms, acts inviolation of trade practices or market practices, or
acts in a way that is detrimental from the perspectiveof users, and customers are inconvenienced, fairnessof the market is harmed, or the reputation of thefinancial institution itself is harmed as a result.
The Group acts in compliance with not only laws,
regulations and internal rules, etc., but al so incompliance with the Group’s ethical and action
guidelines.

The Group regards compliance as one of the top

addition, the Group has assigned the officer in charge

priorit y management issues, strives to establishof the Risk M ana gement Division as the chief

corporate ethics based on its social mission as acompliance officer, established the Risk Management

regional financial group, and endeavors to ensure theDivision as the division supervising compliancerelated

soundness and appropriateness of business operations,matters, and put in place the compliance system.

upholding its basic policy of fostering the corporate

Moreover, to enhance the Group’s ability to respond toculture that emphasizes compliance and is trusted bycompliance risk, we created the “Headquarters

shareholders, customers, and society. The Group also

Compliance Officer (Headquarters CO)” and “Sales

has established the Compliance Committee to propose

Office Compliance Officer (Sales Office CO)” roles inmeasures for the compliance-related matters of the

December 2020 to further develop the system.

Group and to strengthen the compliance function. In

are maintaining the functions of buildings andand secure financial functions to customers andfacilities, etc. to be able to use facilities and systems,

employees in the event of the occurrence of a naturaletc. in a continuous and stable manner while also

disaster such as an earthquake or the spread of

implementing measures such as assessing facility

infe c tious disease. The G roup has fo rmul ate da gi n g , c a r r y i n g o u t a p p ro p ria te m a i n te n a n ce

contingency plans for the occurrence of disasters andmanagement to prepare for various types of disasters,

has introduced a system for verifying the safety ofaccidents, and infectious diseases, etc.

employees, and has also established systems such as

Board of Directors

Audit & Supervisory Board Members
Audit & Supervisory Board

Management Meeting

Initiatives for strengthening cyber security management
We regard the threat of cyberattacks, which havecyber risk as a system risk while formulating a

become increasingly advanced and sophisticatedcontingency plan. Furthermore, we conduct e-mailyear after year, as one such risk and work on taking

drills assuming a targeted attack and test to confirm

cybersecurity measures. We develop the cyber risk

our employees’ basic knowledge of cybersecurity

management system by assigning a person to be inre g u l a rly i n a b i d to e d u c ate t h e m a n d ra is echarge of cybersecurity in the Risk Managementawareness about cybersecurity within the Group.

Compliance Committee

Instructions /Management

Kiraboshi Bank, Ltd.
Sales oﬃces and headquarters divisions
Sales oﬃce
Compliance oﬃcer
COCompliance administrator
Headquaters
COTokyo Kiraboshi Lease, Inc.
Kiraboshi System, Inc.

Discussion /Reporting

Kiraboshi Consulting Co., Ltd.
Kiraboshi JCB Co., Ltd.
Kiraboshi Capital Co., Ltd.
Kiraboshi Life Design Securities Co., Ltd.
Kiraboshi Digital Bank Preparatory Co., Ltd.

Risk Management Division (Headquaters CO)

Kiraboshi business oﬃce service, Inc.

Basic Compliance Policy
The Group regards compliance as one of the top priority management issues, strives to establish corporate
ethics based on its social mission as a regional financial group, and has established its basic policy to foster
the corporate culture that emphasizes compliance and is accredited by shareholders and trusted bycustomers and society. The Group stipulates the following “Action Principles” to implement the basic policy.
1. Social responsibility and public mission of bank
We will recognize the importance of our social responsibility and public mission at all times and strive to
win the unwavering trust through sound business operations.
2. Customer-first principle
We will consider customers first, satisfy customer needs, leverage our creativity and ingenuity, andprovide highquality financial services. We will live up to customers’ trust and always pursue with asincere attitude what customers expect us to do.
3. Strict compliance with laws, regulations, and rules
We will strictly comply with all laws, regulations, and rules and carry out sincere and fair corporate
activities that do not violate social norms.
4. Developing together with local communities
We will contribute to the economic and cultural development of prosperous and vibrant local
communities through our financial services.
5. Respect for human rights of employees, etc.
We will respect human rights and individuality of employees and ensure a safe and comfortable working
environment.

6. Elimination of relationship with antisocial forces
We firmly confront antisocial forces that threaten the order and safety of civil society and ensure toeliminate any relationship with them.

31 │Tokyo Kiraboshi Financial Group, Inc.│

Growth Strategy

system for business continuity, such as providing safe

■ Chart of compliance system│Tokyo Kiraboshi Financial Group, Inc.│ 32

Initiatives for Strengthening Management Base

implementing periodic disaster drills. In addition, we

Corporate Data

The Group has established a crisis management

Subsidiaries, etc.

Crisis Management

Division and assessing system risks by positioning

Tokyo Kiraboshi Financial Group

Initiatives for Strengthening Management Base ─ Risk Management ─Initiatives for Strengthening Management Base ─ Compliance ─Management Division has the centralized function toforces, the Company has established the “Basic Policy

control information on antisocial forces, and theon Dealing with Antisocial Forces” and the “Basic

Company and the Group companies strive to collect

Rules on Dealing with Antisocial Forces” and puts inand share information on antisocial forces.

p l a c e t h e s y s te m f o r t h i s p u r p o s e . T h e R i s k

Whistleblowing system
The Group has established the “Hotline System” as a mechanism for responding properly to an employee, dispatchedworker, part-time worker, or other staff who initiates whistleblowing or wishes to have a consultation aboutcompliance issues (including harassment).
Kiraboshi Bank, Ltd. has established a contact point for whistleblowing in the Compliance Section of Risk
Management Department and in the law firm which its legal counsel works for.
This whistleblowing system is strictly stipulated in the Group’s internal regulations as to the confidential treatment of

Basic Policy on Dealing with Antisocial Forcesa whistleblower’s identity and the prohibition of disadvantageous treatment of a whistleblower.

The Group eliminates and will eliminate any relationship whatsoever with antisocial forces that threaten theorder and safety of civil society, will comply with the following basic policy, and ensure sound andresponsible business operations.
1. Deal with antisocial forces that threaten the order and safety of civil society as an organization andmaintain a firm attitude against them.
2. Endeavor to strengthen close cooperation with the police and other external specialized agencies in
preparation for unreasonable demands by antisocial forces even under normal circumstances.

Putting the “customer feedback” to practical use
At Kiraboshi Bank, Ltd. we collect, manage and analyze thecustomer feedback and strive to improve our services.
In addition, the customer feedback is centrally managed at
the Customer Relations Center, and information is sharedwith officers.

OﬃcersKiraboshi Bank, Ltd.
Collecting and managing
Improvements

Customers

Analyzing

3. Eliminate any relationship whatsoever including transactions with antisocial forces.
4. Reject firmly any unreasonable demands from antisocial forces, including taking civil or criminal actions.

Initiatives for Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT)

5. Reject firmly any requests for providing funds or benefits to antisocial forces.

Tokyo Kiraboshi Financial GroupIn order to eliminate any relationship with antisocial

Growth Strategy

Status of putting in place a system for eliminating antisocial forces

The Group considers the prevention of money laundering, etc. as one of the most important management issues,and its basic policy is to establish an effective management system to maintain the public trust, while making efforts

Group Basic Policy for Protection of Personal Information

to constantly verify and improve the system.
In recognition of its importance, we have put in place a system to ensure the effectiveness and appropriateness ofthe money laundering prevention system.
Initiatives for Strengthening Management BaseThe Group recognizes that it is its social responsibility to handle personal information of customers in a proper and strict manner. It hasestablished the following basic policy and will do everything possible to protect personal information by complying with the policy.
1. Explanation for Customers / The Group will strive to provide accurate and appropriate information and explanations on products and services
that fit customers in addressing transactions in compliance with laws and regulations so that they can understand them adequately.
2. Customer Support / The Group will respond to inquiries, requests and complaints from customers and provide consultation to them sincerely
and properly from their standpoint to enhance customer satisfaction.
3. Managing Customer Information / The Group will acquire and use customers’ personal information properly in compliance with laws and regulations andtake appropriate measures to prevent fraudulent access to, or leak of information due to improper handling, thereby ensuring their safe management.
4. Managing Outsourcing / When outsourcing work that the Group conducts, it will supervise the outsourcing service provider to ensure that
personal information of customers and response to customers will be managed and conducted properly.
5. Managing Conflicts of Interest / The Group will strive to manage conflicts of interest so that a customer’sinterest may not be improperly infringed in addressing transactions with the customer.
6. Others / The Group will also strive to manage operations properly to enhance convenience for its customers and ensure adequacy.

Financial ADR system
Kiraboshi Bank, Ltd. of the Group has established a specialized

The designated dispute resolution bodywhich Kiraboshi Bank, Ltd. has contracted withdepartment for various consultations and complaints from
custo m e rs , a n d co nt ra c te d wit h t h e “Ja p a n ese B a n ke rs
Association Consultation Office,” a designated dispute resolution
body, to facilitate the quick and flexible solution of issues.

33 │Tokyo Kiraboshi Financial Group, Inc.│

Corporate Data

* The “Customer” under the policy refers to “those who make transactions or consider making them in the future with the Group.”* The “Transactions” under the policy refer to “all transactions between customers and the Group as it conducts credit transactions (including
loan contracts and their corresponding collateral/guarantee agreements), accepts deposits, and sells, brokers or offers products.”

Japanese Bankers
Association

Contact:Japanese Bankers Association

Consultation Oﬃce

Telephone number: 0570-017109

or 03-5252-3772│Tokyo Kiraboshi Financial Group, Inc.│ 34

Corporate Data ─ Tokyo Kiraboshi Financial Group ─

Hidenori Tsunehisa,

Satoru Nobeta,

Shuya Nomura,

Yukio Kasai,

Toru Narata,■ Career Summary
Apr. 1985 Joined the Tokyo Tomin Bank, Limited
Jun. 2014 Executive Officer and General Manager of Loan
Administration Division, the Tokyo Tomin Bank, Limited
Jun. 2015 Executive Officer and General Manager of Nihonbashi
Branch Office, the Tokyo Tomin Bank, Limited
Jun. 2017 Director and Managing Executive
Officer, the Tokyo Tomin Bank, Limited
Director, Tokyo TY Financial Group, Inc.
May 2018 Deputy President, Tokyo Kiraboshi Financial Group, Inc.
President, Kiraboshi Bank, Ltd. (current position)
Jun. 2020 President, Tokyo Kiraboshi Financial Group, Inc. (current position)■ Career Summary
Apr. 1987 Joined The Mitsubishi Bank, Ltd.
Feb. 2001 Manager, PricewaterhouseCoopers
Consultants Co., Ltd.
Apr. 2004 Joined the ShinGinko Tokyo, Limited
Jun. 2015 President and CEO, ShinGinko
Tokyo, Limited
Apr. 2016 Director, Tokyo TY Financial Group, Inc.
May 2018 Senior Managing Director, Kiraboshi
Bank, Ltd. (current position)
Jun. 2021 Deputy President, Tokyo Kiraboshi
Financial Group, Inc. (current position)■ Career Summary
Apr. 1984 Joined the Industrial Bank of Japan, Limited
Jun. 2014 Director and Executive Officer, theTokyo Tomin Bank, Limited
Apr. 2016 Managing Director, the Tokyo Tomin Bank, Limited
Jun. 2016 Director, Tokyo TY Financial Group, Inc.
Jun. 2017 Senior Managing Director, the Tokyo Tomin Bank, Limited
May 2018 Director, Tokyo Kiraboshi Financial Group, Inc.
Jun. 2020 Senior Managing Director, Tokyo Kiraboshi
Financial Group, Inc. (current position)
Jun. 2021 Director and Senior Executive Officer,
Kiraboshi Bank, Ltd. (current position)■ Career Summary
Apr. 1998 Professor, Faculty of Law, Chuo University
Apr. 2004 Professor, Graduate School of Law,
Chuo University (current position)
Attorney, Mori Hamada & Matsumoto(current position)
Jun. 2014 Outside Director, Mitsubishi UFJ
Trust and Banking Corporation
Jun. 2016 Outside Director, Audit and Supervisory Committee Member,
Mitsubishi UFJ Trust and Banking Corporation (current position)
Jun. 2021 Outside Director, Tokyo Kiraboshi
Financial Group, Inc. (current position)■ Career Summary
Apr. 1980 Joined the Tokyo Tomin Bank,
LimitedJun. 2016 Full-time Audit & Supervisory
Board Member, the Tokyo Tomin
Bank, Limited
May 2018 Full-time Audit & Supervisory Board
Member, Kiraboshi Bank, Ltd.
Jun. 2020 Full-time Audit & Supervisory
Board Member, Tokyo Kiraboshi
Financial Group, Inc. (current
position)■ Career Summary
Apr. 1983 Joined Yachiyo Shinkin Bank
Jun. 2017 Director and Managing Executive
Officer, the Yachiyo Bank, Limited
Director, Tokyo TY Financial
Group, Inc
May 2018 S e n i o r M a n a g i n g D i r e c t o r ,Kiraboshi Bank, Ltd.
Jun. 2020 Full-time Audit & Supervisory
Board Member, Tokyo Kiraboshi
Financial Group, Inc. (current
position)

Nobuyuki Yasuda,

Yuki Takahashi,

Shoji Nishio,

Nobuko Inaba,

Kayo Todo,■ Career Summary
Apr. 1988 Joined Yachiyo Shinkin Bank
Jun. 2017 Director and Executive Officer, theYachiyo Bank, Limited
May 2018 Director and Executive Officer, Kiraboshi Bank, Ltd.
Apr. 2020 General Manager of Corporate Planning
Division, Tokyo Kiraboshi Financial Group, Inc.
Director and Executive Officer, Kiraboshi Bank, Ltd.
Jun. 2020 Director and Managing Executive Officer,
Kiraboshi Bank, Ltd. (current position)
Jun. 2021 Director and General Manager of Corporate Planning Division,
Tokyo Kiraboshi Financial Group, Inc. (current position)■ Career Summary
Dec. 2003 Joined Bears Co., Ltd. Senior
Managing Director
Oct. 2016 Vice President and Director, Bears
Co., Ltd. (current position)
Jun. 2017 Outside Director, Tokyo TY Financial
Group, Inc. (currently Tokyo Kiraboshi
Financial Group, Inc.) (current position)
Apr. 2018 Vice Chairman, The Tokyo New
Business Conference (current position)
Apr. 2019 Chairman, National Housekeeping
Service Association (current position)■ Career Summary
Mar. 1978 Joined The Tokyo Chamber ofCommerce and Industry
Jun. 2016 Managing Director, The Tokyo
Chamber of Commerce and Industry
May 2019 Outside Audit & Supervisory Board
Member, WORLD TRADE CENTER
BUILDING, INC. (current position)
Jun. 2019 Outside Director, Tokyo Kiraboshi
Financial Group, Inc. (current position)
Apr. 2021 Associate Advisor, The Tokyo Chamber ofCommerce and Industry (current position)■ Career Summary
Jul. 2007 Established PAS Co., Ltd. (currently Hayabusa Consulting
Co., Ltd.) President, PAS Co., Ltd. (current position)
Nov. 2010 Established Hayabusa Audit Corporation (now mergedwith Yasumori Accounting and Audit Office) SeniorPartner, Hayabusa Audit Corporation (current position)
Oct. 2014 Outside Corporate Auditor, Tokyo TY Financial
Group, Inc. (currently Tokyo Kiraboshi
Financial Group, Inc.) (current position)
Jun. 2019 Outside Corporate Auditor, DeNA Co., Ltd. (current position)
Jun. 2021 Outside Audit & Supervisory Board Member,
Kanematsu Corporation (current position)■ Career Summary
Apr. 1997 Joined KOHWA SOHGOH LAW OFFICES
Jan. 2002 Partner, KOHWA SOHGOH LAWOFFICES (current position)
Oct. 2014 Outside Corporate Auditor, Tokyo TY Financial
Group, Inc. (currently Tokyo Kiraboshi
Financial Group, Inc.) (current position)
Jun. 2015 Outside Corporate Auditor, JAPAN POST
TRANSPORT Co., Ltd. (current position)
Jun. 2017 O u t s i d e D i r e c t o r , G M O C L I C K
Holdings, Inc. (currently GMO Financial
Holdings, Inc.) (current position)

Outside Director

Senior Managing Director

Outside Director

Outside Director

Full-time Audit & Supervisory Board Member

Outside Audit & Supervisory Board Member

Full-time Audit & Supervisory Board Member

Initiatives for Strengthening Management Base

Director

Deputy President

Outside Audit & Supervisory Board Member

Masahiro Ogura, Executive Officer

Company Overview (As of March 31, 2021)

Organization Chart (As of April 1, 2021)
Audit & Supervisory Board Members
and Audit & Supervisory Board

Business nameTokyo Kiraboshi Financial Group, Inc.

Business details

1.Corporate management of a bank and companies that can be made subsidiaries pursuant to the Banking Act.
2.All other operations incidental and related to the operations in the preceding item.

Head office

3-10-43 Minami Aoyama, Minato-ku, Tokyo

Established

October 1, 2014

Capital
Exchange listing

35 │Tokyo Kiraboshi Financial Group, Inc.│¥27.5 billion
Tokyo Stock Exchange, First Section (Securities Code: 7173)

Board of Directors
Nomination/Remuneration Committee

Audit & Supervisory Board Oﬃce

Internal Audit DivisionCorporate Planning Division

Management Meeting

Secretariat Oﬃce

Risk Management Division

Business Strategy Division

Group Strategy Oﬃce

Compliance Committee
Risk Management Committee
ALM Committees

Digital Strategy DivisionPartnership Promotion DivisionTokyo Metropolitan Government
Collaboration Promotion Oﬃce

Public Sector Collaboration
Promotion Oﬃce

│Tokyo Kiraboshi Financial Group, Inc.│ 36

Corporate Data

President

Growth Strategy

Hisanobu Watanabe,Tokyo Kiraboshi Financial Group

Officers (As of July 1, 2021)

Consolidated Financial Statements
Tokyo Kiraboshi Financial Group, Inc. and its Consolidated Subsidiaries
March 31, 2021 and 2020

2020

AssetsCash and due from banks��������������������������������������������������������������������������������������������
Call loans and bills bought������������������������������������������������������������������������������������������
Monetary claims bought����������������������������������������������������������������������������������������������
Trading account securities�������������������������������������������������������������������������������������������
Money held in trust��������������������������������������������������������������������������������������������������������
Securities����������������������������������������������������������������������������������������������������������������������������
Loans and bills discounted������������������������������������������������������������������������������������������
Foreign exchange������������������������������������������������������������������������������������������������������������
Lease receivables and investment assets���������������������������������������������������������������
Other assets���������������������������������������������������������������������������������������������������������������������
Tangible fixed assets������������������������������������������������������������������������������������������������������
Buildings��������������������������������������������������������������������������������������������������������������������������
Land����������������������������������������������������������������������������������������������������������������������������������
Leased assets����������������������������������������������������������������������������������������������������������������
Construction in progress�������������������������������������������������������������������������������������������
Other tangible fixed assets��������������������������������������������������������������������������������������
Gain on disposal of non-current assets������������������������������������������������������������������
Software��������������������������������������������������������������������������������������������������������������������������
Leased assets����������������������������������������������������������������������������������������������������������������
Other tangible fixed assets��������������������������������������������������������������������������������������
Net defined benefit assets������������������������������������������������������������������������������������������
Deferred tax assets��������������������������������������������������������������������������������������������������������
Customers’ liabilities for acceptances and guarantees�������������������������������������
Reserve for possible loan losses��������������������������������������������������������������������������������

¥ 753,974―
68,935845
1,620
1,019,415
3,926,518
9,422
18,71462,99856,362
16,49933,192
2,022
6
4,641
6,629
4,101
271
2,257
24,0543,140
4,412(35,101)¥ 538,902
2,513
74,1991,006
651
948,0423,760,834
5,593
17,622
93,27358,41917,11933,192
2,262
439
5,404
3,771
1,998
256
1,516
13,234
11,251
4,905(33,076)$ 6,810,351―
622,662
7,632
14,632
9,207,975
35,466,696
85,105
169,036
569,036
509,095
149,028
299,810
18,26354
41,92059,87737,042
2,447
20,386217,270
28,36239,851(317,053)

Total assets¥ 5,921,945¥ 5,501,145$ 53,490,606

Liabilities
Deposits�����������������������������������������������������������������������������������������������������������������������������
Negotiable certificates of deposit�����������������������������������������������������������������������������
Call money and bills sold���������������������������������������������������������������������������������������������
Payables under securities lending transactions���������������������������������������������������
Borrowed money������������������������������������������������������������������������������������������������������������
Foreign exchange������������������������������������������������������������������������������������������������������������
Bonds����������������������������������������������������������������������������������������������������������������������������������
Other liabilities����������������������������������������������������������������������������������������������������������������
Reserve for employee bonuses����������������������������������������������������������������������������������
Provision for directors’ bonuses���������������������������������������������������������������������������������
Provision for stock compensation�����������������������������������������������������������������������������
Net defined benefit liabilities�������������������������������������������������������������������������������������
Reserve for directors’ retirement benefits��������������������������������������������������������������
Reserve for point card certificates����������������������������������������������������������������������������
Provision for loss on interest repayments��������������������������������������������������������������
Reserve for loss on dormant deposit repayments����������������������������������������������
Provision for loss on cancellation of system contracts��������������������������������������
Provision for contingent loss���������������������������������������������������������������������������������������
Reserves under special laws���������������������������������������������������������������������������������������
Deferred tax liabilities���������������������������������������������������������������������������������������������������
Acceptances and guarantees�������������������������������������������������������������������������������������

¥4,972,473
9,500
59,632
271,382
241,372293
4,000
43,864
1,523
155
163
53
14
43
7
1,289
―
794
0
86
4,412

¥4,631,187
7,300
217,692
256,620
42,177232
4,200
37,291
1,637
183
139
65
23
40
8
1,318
935
659
―
60
4,905

$44,914,397
85,809538,632
2,451,287
2,180,218
2,646
36,130396,206
13,756
1,400
1,472
478
126
388
63
11,643
―
7,171
0
776
39,851

Total liabilities¥ 5,611,065¥ 5,206,683$ 50,682,549

¥

¥

$

Net Assets
Common stock����������������������������������������������������������������������������������������������������������������
Capital surplus�����������������������������������������������������������������������������������������������������������������
Retained earnings�����������������������������������������������������������������������������������������������������������
Treasury stock������������������������������������������������������������������������������������������������������������������

27,500150,677
117,514(742)

27,500150,684
114,641(814)

248,396
1,361,006
1,061,457(6,702)

Total shareholders’ equity
Net unrealized gain on available-for-sale securities�������������������������������������������
Net deferred gains (losses) on hedges��������������������������������������������������������������������
Revaluation reserve for land���������������������������������������������������������������������������������������
Foreign currency translation adjustment����������������������������������������������������������������
Remeasurements of defined benefit plans������������������������������������������������������������

294,949
13,078
189
(242)
11
2,863

292,010
5,629
41
(242)
4
(3,038)2,664,158
118,128
1,707(2,185)99
25,860Total accumulated other comprehensive income�����������������������������������������������

15,9002,394

143,618

Subscription rights to shares���������������������������������������������������������������������������������������

30

56

270

Total net assets���������������������������������������������������������������������������������������������������������������

310,880

294,4622,808,057

Total liabilities and net assets���������������������������������������������������������������������������������

¥ 5,921,945¥ 5,501,145$ 53,490,606

U.S. dollar amounts are the yen equivalent, calculated for convenience only, at the rate of ¥110.71 = U.S. $1.

37 │Tokyo Kiraboshi Financial Group, Inc.│

Consolidated Income Statements
2021¥93,352
58,751
46,384
11,422
4
384
556
150
14,940
4,093
15,41653
15,36285,127
1,252
734
1
87
172
237
14
3
3,273
1,211
56,09823,291
7,858
15,432
8,224
0
0
―
―
124
97
―
―
27

2020
¥94,031
56,98944,108
11,940
38
299
602
156
16,880
6,762
13,241
87
13,15391,683
2,381
1,094
1
606
584
76
7
9
3,045
1,621
55,814
28,821
11,17817,643
2,347
6,975
6,315
523
136
1,065
59
70
935
―

Thousands of
U.S. Dollars
2021$843,211
530,674
418,968
103,170
36
3,468
5,022
1,354
134,947
36,970139,246478
138,758
768,918
11,308
6,629
9
785
1,553
2,140
126
27
29,563
10,938506,711
210,378
70,978139,391
74,284
0
0
―
―
1,120
876
―
―
243

Profit before income taxes

8,099

8,256

73,155

Total income taxes

3,938

597

35,570Millions of Yen
Ordinary income
Interest income�������������������������������������������������������������������������������������������������������������
Interest on loans and discounts���������������������������������������������������������������������������
Interest and dividends on securities�������������������������������������������������������������������
Interest on call loans and bills bought��������������������������������������������������������������
Interest on deposits with banks��������������������������������������������������������������������������
Other interest income���������������������������������������������������������������������������������������������
Trust fees�������������������������������������������������������������������������������������������������������������������������
Fees and commissions�����������������������������������������������������������������������������������������������
Other operating income��������������������������������������������������������������������������������������������
Other ordinary income�����������������������������������������������������������������������������������������������
Recoveries of written-off claim�����������������������������������������������������������������������������
Others���������������������������������������������������������������������������������������������������������������������������
Ordinary expenses
Financing expenses�����������������������������������������������������������������������������������������������������
Interest on deposits�������������������������������������������������������������������������������������������������
Interest on negotiable certificates of deposit�������������������������������������������������
Interest on call money and bills sold�����������������������������������������������������������������
Interest on payables under securities lending transactions�����������������������
Interest on borrowed money��������������������������������������������������������������������������������
Interest on corporate bonds���������������������������������������������������������������������������������
Other interest expenses�����������������������������������������������������������������������������������������
Fees and commissions payments��������������������������������������������������������������������������
Other operating expenses����������������������������������������������������������������������������������������
General and administrative expenses������������������������������������������������������������������
Other ordinary expenses������������������������������������������������������������������������������������������
Provision of allowance for loan losses������������������������������������������������������������������
Other ordinary expenses������������������������������������������������������������������������������������������
Ordinary profit
Extraordinary income
Gain on disposal of non-current assets���������������������������������������������������������������
Gain on step acquisitions������������������������������������������������������������������������������������������
Gain on bargain purchase�����������������������������������������������������������������������������������������
Extraordinary losses
Loss on disposal of non-current assets����������������������������������������������������������������
Impairment losses��������������������������������������������������������������������������������������������������������
Provision for loss on cancellation of system contracts�����������������������������������
Loss on cancellation of system contracts������������������������������������������������������������
Income taxes – current
Income taxes – deferred
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

1,551
2,387

3,861
(3,264)

4,161

7,659

37,584¥ 4,161¥ 7,657$ 37,584―2

Consolidated Statements of Comprehensive Income―2021¥ 4,161
13,455
7,397
148
7
5,902
―
17,6162020¥ 7,659(4,088)(2,293)41(4)(1,788)(44)
3,571

Thousands of
U.S. Dollars
2021$ 37,584
121,533
66,814
1,336
63
53,310―159,118¥ 17,616
―

¥

3,611
(40)

$159,118―

Millions of Yen
ProfitOther comprehensive income
Net unrealized gain on available-for-sale securities����������������������������������������
Net deferred gains (losses) on hedges�����������������������������������������������������������������
Foreign currency translation adjustment�������������������������������������������������������������
Remeasurements of defined benefit plans���������������������������������������������������������
Share of other comprehensive income of entities accounted for using equity method���Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent����������������������������
Comprehensive income attributable to non-controlling interests��������������

14,00921,560U.S. dollar amounts are the yen equivalent, calculated for convenience only, at the rate of ¥110.71 = U.S. $1.
│Tokyo Kiraboshi Financial Group, Inc.│ 38

Tokyo Kiraboshi Financial Group

2021

Growth Strategy

Millions of Yen

Consolidated Income Statements and Consolidated
Statements of Comprehensive Income

Initiatives for Strengthening Management Base

Thousands of
U.S. Dollars
2021

Corporate Data

Consolidated Balance SheetsThousands of U.S. Dollars
2021
Shareholders’ equity
Accumulated other comprehensive income
Net
Net
Total
Foreign RemeasureTotal
unrealized deferred Revaluation
accumulated Subscription Noncurrency ments ofCommon Capital Retained Treasury
Total net
shareholders’ gain on
rights to controlling
gains reserve forothertranslation defined
stock surplus earnings stock
assetsequity available-for- (losses) on landinterests
comprehen- sharesadjustment benefit planssale securities hedges
sive income
Balance at beginning of the year��� 248,396 1,361,069 1,035,507(7,352) 2,637,611
50,844370(2,185)36 (27,441) 21,624
505― 2,659,759
Changes of items during the reporting period���Dividends of surplus����������������
(18,706)(18,706)(18,706)
Profit attributable to owners of parent���37,58437,58437,584
Acquisition of treasury stock���
(135)
(135)
(135)
Disposition of treasury stock��
(54)
785
722
722
Increase in retained earnings due to
7,063
7,063
7,063
addition of equity-method affiliates���
Increase in treasury stock due to
(0)
(0)
(0)
addition of equity- method affiliates���
Net changes of items other than shareholders’equity during the reporting period��������������
67,274
1,336―
63
53,310 121,985(225)― 121,750
Total changes of items during the reporting period��―(54) 25,950
641
26,537
67,274
1,336―
63
53,310 121,985(225)― 148,297
Balance at end of period���������� 248,396 1,361,006 1,061,457(6,702) 2,664,158 118,128
1,707(2,185)99
25,860 143,618
270― 2,808,057

39 │Tokyo Kiraboshi Financial Group, Inc.│

Millions of Yen
Cash flows from operating activities
Profit before income taxes�����������������������������������������������������������������������������������������������������
Depreciation��������������������������������������������������������������������������������������������������������������������������������
Impairment losses���������������������������������������������������������������������������������������������������������������������
Gain on bargain purchase������������������������������������������������������������������������������������������������������
Step acquisitions loss (gain)���������������������������������������������������������������������������������������������������
Share profit of entities accounted for using equity method���������������������������������������
Increase (decrease) in reserve for possible loan losses����������������������������������������������
Increase (decrease) in reserve for employee bonuses�������������������������������������������������
Increase (decrease) in provision for directors’ bonuses����������������������������������������������
Increase (decrease) in provision for stock compensations����������������������������������������
Decrease (increase) in net defined benefit assets��������������������������������������������������������
Increase (decrease) in net defined benefit liability�������������������������������������������������������
Increase (decrease) in reserve for directors’ retirement benefits�����������������������������
Increase (decrease) in reserve for point card certificates�������������������������������������������
Increase (decrease) in reserve for loss on interest repayments�������������������������������
Increase (decrease) in reserve for loss on dormant deposit repayments�������������
Increase (decrease) in provision for loss on cancellation of system contracts���
Increase (decrease) in reserve for contingent loss��������������������������������������������������������
Interest income���������������������������������������������������������������������������������������������������������������������������
Financing expenses�������������������������������������������������������������������������������������������������������������������
Gain (loss) on securities����������������������������������������������������������������������������������������������������������
Net losses (gains) on money held in trust������������������������������������������������������������������������
Foreign exchange losses (gains)�������������������������������������������������������������������������������������������
Net loss (gain) on disposal of non-current assets���������������������������������������������������������
Net increase (decrease) in trading account securities�������������������������������������������������
Net (decrease) increase in loans and bills discounted������������������������������������������������
Net increase (decrease) in deposits�����������������������������������������������������������������������������������
Net increase (decrease) in negotiable certificates of deposit�����������������������������������
Net increase (decrease) in borrowed money (excluding subordinated loans)���
Net decrease (increase) in deposit (excluding deposit paid to Bank of Japan)���
Net (decrease) increase in call loans���������������������������������������������������������������������������������
Net increase (decrease) in call money�������������������������������������������������������������������������������
Net increase (decrease) in payables under securities lending transactions��������
Net decrease (increase) in foreign exchange (assets)��������������������������������������������������
Net increase (decrease) in foreign exchange (liabilities)���������������������������������������������
Net decrease (increase) in lease receivables and investment assets���������������������
Increase (decrease) due to issuance and redemption of straight bonds��������������
Net increase (decrease) in borrowed money from trust account����������������������������
Proceeds from fund management ��������������������������������������������������������������������������������������
Payments for finance����������������������������������������������������������������������������������������������������������������
Other����������������������������������������������������������������������������������������������������������������������������������������������
Subtotal
Income taxes paid���������������������������������������������������������������������������������������������������������������������
Income taxes refund�����������������������������������������������������������������������������������������������������������������Cash flows from operating activities
Cash flows from investing activities
Purchase of securities��������������������������������������������������������������������������������������������������������������
Proceeds from sales of securities����������������������������������������������������������������������������������������
Proceeds from redemption of securities���������������������������������������������������������������������������
Payments due to increase in money held in trust����������������������������������������������������������
Purchase of tangible fixed assets�����������������������������������������������������������������������������������������
Retirement of tangible fixed assets�������������������������������������������������������������������������������������
Proceeds from sales of tangible fixed assets�������������������������������������������������������������������
Purchase of intangible fixed assets�������������������������������������������������������������������������������������
Payment from changes in ownership interests in subsidiaries that result in changes in scope of consolidation���
Purchase of shares in affiliates�����������������������������������������������������������������������������������������������
Net cash provided by (used in) investing activities
Cash flows from financing activities
Repayments of subordinated borrowings������������������������������������������������������������������������Cash dividends paid�����������������������������������������������������������������������������������������������������������������
Dividends paid to non-controlling interests���������������������������������������������������������������������
Purchase of treasury shares���������������������������������������������������������������������������������������������������
Proceeds from sale of treasury stock���������������������������������������������������������������������������������
Proceeds from exercise of share options��������������������������������������������������������������������������
Proceeds from exercise of performance-linked stock-based compensation�������
Payments from changes in ownership interests in subsidiaries that do not result in changes in scope of consolidation���Repayments of lease obligations��������������������������������������������������������������������������������������������
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

2021
¥

¥

8,099
4,820
―
―
―
(24)
2,025
(113)
(28)
23
(10,819)
(12)
(9)
3
(0)
(29)
(935)
134
(58,751)
1,252(5,446)(168)(9,003)97
160(165,683)
341,285
2,200
199,195
134
7,777(158,059)
14,761(3,829)61(1,092)(200)―
55,154(1,724)14,007235,258(3,719)1,005
232,544

2020
¥

8,256
3,958
70
(136)
(523)
(17)
6,404
(78)
24
57
893
(0)
(10)
1
(0)
(32)
935
3
(56,989)
2,381(3,087)48
2,262(6,255)(32)(70,843)
104,275(8,800)(11,732)200(15,034)
104,363(88,297)391(300)(1,880)2,200(245)
59,334(2,715)(2,275)
26,774(1,744)403
25,433Thousands of
U.S. Dollars
2021$

73,15543,537―――(216)
18,291(1,020)(252)
207(97,723)
(108)
(81)
27
(0)
(261)
(8,445)
1,210(530,674)
11,308(49,191)(1,517)(81,320)876
1,445(1,496,549)
3,082,693
19,871
1,799,250
1,210
70,246(1,427,684)
133,330(34,585)
550(9,863)(1,806)―498,184(15,572)
126,519
2,124,993(33,592)
9,077
2,100,478(384,714)
214,154
168,458(800)(2,342)(753)
1(4,339)―(4,999)(15,335)(279,044)
264,935
126,400(700)(1,840)(566)
11,285(1,210)(1,057)―
118,200(3,474,970)
1,934,369
1,521,615(7,226)(21,154)(6,801)
9(39,192)―(45,154)(138,515)―(2,071)
―
(15)
6
27
52
―
(3)
(2,003)0215,206
538,286
753,492(5,000)(2,069)
(4)
(72)
15
―
―
(64)
(83)
(7,277)
1
136,357
401,928
538,286―(18,706)
―
(135)
54
243
469
―
(27)
(18,092)0
1,943,871
4,862,126$ 6,805,997¥│Tokyo Kiraboshi Financial Group, Inc.│ 40

Growth Strategy

Millions of Yen
2020
Shareholders’ equity
Accumulated other comprehensive income
Net
Net
Total
Foreign RemeasureTotal
unrealized deferred Revaluation
accumulated Subscription Noncurrency ments ofCommon Capital Retained Treasury
Total net
shareholders’ gain on
rights to controlling
gains reserve forothertranslation defined
stock surplus earnings stock
assetsequity available-for- (losses) on landinterests
comprehen- sharesadjustment benefit planssale securities hedges
sive income
Balance at beginning of the year��� 27,500 150,473 109,053(804) 286,223
7,923
―
(242)
8 (1,250) 6,44056404 293,124
Changes of items during the reporting period���
Purchase of shares of consolidated subsidiaries���
214
(0)
213
213
Dividends of surplus����������������
(2,068)(2,068)(2,068)
Profit attributable to owners of parent���
7,657
7,657
7,657
Acquisition of treasury stock���
(26)
(26)
(26)
Disposition of treasury stock��
(4)
15
11
11
Net changes of items other than shareholders’equity during the reporting period��������������
(2,294)41―(4) (1,788) (4,045)―(404) (4,450)
Total changes of items during the reporting period��
―
210
5,587
(10) 5,787 (2,294)41―(4) (1,788) (4,045)―(404) 1,337
Balance at end of period���������� 27,500 150,684 114,641(814) 292,010
5,629
41
(242)
4 (3,038) 2,394
56― 294,462

Consolidated Statements of Cash Flows

Initiatives for Strengthening Management Base

Millions of yen
2021
Shareholders’ equity
Accumulated other comprehensive income
Net
Net
Total
Foreign Remeasureunrealized deferred Revaluation
accumulated Subscription NonTotal
currency ments ofCommon Capital Retained Treasury
Total net
gains reserve forothershareholders’ gain on
rights to controllingtranslation defined
stock surplus earnings stock
assetscomprehen- shares
equity available-for- (losses) on landinterests
adjustment benefit planssale securities hedges
sive income
Balance at beginning of the year��� 27,500 150,684 114,641(814) 292,010
5,629
41
(242)
4 (3,038) 2,394
56― 294,462
Changes of items during the reporting period���Dividends of surplus����������������
(2,071)(2,071)(2,071)
Profit attributable to owners of parent���
4,161
4,161
4,161
Acquisition of treasury stock���
(15)
(15)
(15)
Disposition of treasury stock��
(6)
87
80
80
Increase in retained earnings due toaddition of equity-method affiliates���
782
782
782
Increase in treasury stock due to
(0)
(0)
(0)
addition of equity- method affiliates���
Net changes of items other than shareholders’equity during the reporting period��������������
7,448
148
―
7
5,902 13,505(25)― 13,479
Total changes of items during the reporting period��―(6) 2,873
71
2,938
7,448
148
―
7
5,902 13,505(25)― 16,418
Balance at end of period���������� 27,500 150,677 117,514(742) 294,949 13,078
189
(242)
11
2,863 15,900
30― 310,880

Corporate Data

Consolidated Statements of Changes in Net Assets

Tokyo Kiraboshi Financial Group

Consolidated Financial Statements

Safeguarding your aspirations;connecting them with reality

2021 Annual Report
Published in July 2021

3-10-43 Minami Aoyama, Minato-ku, Tokyo 107-0062
https://www.tokyo-kiraboshifg.co.jp

This document contains forward-looking statements on the Group’s results.
These statements are not intended to guarantee future results, as they are
subject to risks and contain uncertainties. Please keep in mind that future
results may diﬀer due to factors including changes in the business environment.