Tokyo TY Financial Group
Results briefing for the Fiscal Year Ended
March 31, 2017

June 8, 2017
(TSE1 Listed Code: 7173)

Contents

Company profile ...... 3
Profile of subsidiaries ...... 4
Outline of merger ...... 5
Business philosophy, management policy, overall strategy ...... 6■ Future business strategy■ Future business strategy

Tokyo TYFG’s business environment ...... 23

Tokyo TYFG’s business environment …23

Tokyo TYFG's course of action going forward ...... 24

Tokyo TYFG's course of action going forward …24

Synergistic effects from merger and merger consolidation costs ...... 25

Synergistic effects from merger and merger consolidation costs …25

Improving headquarters efficiency ...... 26■ Summary of business results and profit plan

Improving headquarters efficiency …26

Summary of business results for the fiscal year ended March 31, 2017 (1)[Tokyo TYFG consolidated] ...... 8

Shift to regional divisional structure …27

Summary of business results for the fiscal year ended March 31, 2017 (2)[three‐bank total ∙ individual banks] ...... 9Plan for the fiscal year ending March 31, 2018 ...... 10

Shift to regional headquarters structure ...... 27
Strategic rearrangement of branches ...... 28

Strategic rearrangement of branches …28

Transformation to customer‐oriented sales structure through use of

Transformation
to customer‐orientatedsales structure through“dialogue”…
29
use of “dialogue”…29

Problem solving and mainstay operations support for SMEs based on evaluations

Interest income ...... 11

Problem solving and mainstay operations support for SMEs based on evaluationsof business feasibility ...... 30of business feasibility…30

Yields ...... 12

Strengtheningof consulting
functions ...... 31
Strengtheningof consulting
functions…31

Loans ...... 13

Strengthening
partnershippromotion
Strengthening
partnershippromotion…32‐ 35...... 32 ‐ 35

Loans by industry ...... 14

Initiatives
to support
start‐ups ...... 36
Initiatives
to support
start‐ups…36

Deposits ...... 15

Supportof medical/welfare
field ...... 37
Supportof medical/welfare
field…37

Securities ...... 16

Supportfor expanding
overseas‐related
business ...... 38
Supportfor expanding
overseas‐related
business…38

Assets under management ...... 17

Initiatives
for supporting
SMEs
thatusemakeuseof thefunction…39
funding function ...... 39
Initiatives
for supporting
SMEs thatmakeof thefunding

Problem assets subject to disclosure under the Financial Reconstruction Law
and credit‐related costs ...... 18
Capital ratio ...... 19
Core OHR/ROE ...... 20
Special features of the Group ...... 21

Strengthening
solutionsthatusemakeusetrustsof thetrusts function
Strengthening
solutionsthat makeof thefunction…40‐ 41 ...... 40 ‐ 41
FinTechinitiatives“Maekyu”
FinTechinitiatives“Maekyu”‐Rising to the challenge of new business domains‐ 42 ‐ 43
‐Rising to the challenge of new business domains‐ ...... 42 ‐ 43

◆ CSR initiatives■ CSR initiatives

CSR initiatives…45

CSR initiatives ...... 452

Company profile■ Major Group companies■ Management philosophy
To be a financial group for small and medium‐sized enterprisecustomers and individual customers in the Tokyo metropolitan areathat will contribute to the development of local communities
through comprehensive financial services.

Tokyo Tomin Bank

Yachiyo Bank

ShinGinko Tokyo

Kiraboshi Consulting■ Management policy■ Company history
A bank that sparkles
December 1924 Founded The Yachiyo Bank, Limited
December 1951 Established The Tokyo Tomin Bank, Limited

Achieve enduring existence as a local regional bank through theprovision of unique financial services

April 2004 Established ShinGinko Tokyo, Limited
October 2014 Business integration by The Tokyo Tomin Bank, Limited and The Yachiyo Bank,
LimitedEstablished Tokyo TY Financial Group, Inc.
September 2015 Final agreement regarding business integration between Tokyo TY Financial Group,
Inc. and ShinGinko Tokyo, Limited
Signed the Agreement on a Comprehensive Affiliation for Industrial Development inTokyo with the Tokyo metropolitan government
December 2015 Resolved to proceed with concrete reviews and preparations for a three‐bankmerger by The Tokyo Tomin Bank, Limited, The Yachiyo Bank, Limited, and ShinGinko
Tokyo, Limited around FY2017

A bank that rises to the challenge

Leverage the special features of the Tokyo area to continue to meet
new challenges in order to contribute to the development of ourcustomers and of local economies
A bank that brings together ideas

We put great value on the “ideas” of customers, the region, and our
employees so as to become a necessary and always trusted presence

April 2016 Business integration between Tokyo TY Financial Group, Inc. and ShinGinko Tokyo,
LimitedAugust 2016 Conditional upon obtaining approval from the relevant authorities, it was resolved ata meeting of the board of directors that there would be a merger between the 3banks, in addition to which announcements were made concerning future business
policies and overall strategy
April 2017 Kiraboshi Consulting Co., Ltd. established as a subsidiary owned 100% by theCompany■ Vision aimed for

Become the urban regional bank group most favoredby customers in the Tokyo metropolitan area
3

Profile of subsidiaries■ Profile of subsidiaries

As of March 31, 2017

Three‐bank total

Tokyo Tomin Bank

Yachiyo Bank

ShinGinko Tokyo

Establishment－

December 12, 1951

December 6, 1924
(founding date)

April 1, 2004*1

Head office location－

2‐3‐11, Roppongi,
Minato‐ku, Tokyo*2

5‐9‐2 Shinjuku,
Shinjuku‐ku, Tokyo

1‐21‐1 Nishishinjuku,
Shinjuku‐ku, Tokyo

Capital－55.6 billion yen

43.7 billion yen

20.0 billion yen

Total assets

5,606.7 billion yen

2,773.3 billion yen

2,343.9 billion yen

489.4 billion yen

Net assets

277.4 billion yen

105.1 billion yen

108.9 billion yen

63.3 billion yen

Number of employees

3,194

1,493

1,560

141

Number of branches(including sub‐branches)

164

78

85

1

*1 The date that the Tokyo metropolitan government acquired all of the shares in BNP Paribas Private Bank Ltd. to establish ShinGinko Tokyo is given as the date on which
ShinGinko Tokyo was established. The date on which it was established as a corporation was April 5, 1999.
*2 Scheduled to move to Minami Aoyama, Minato‐ku in the autumn of 2017.

4

Outline of merger
Bank after merger

Holding company

Kiraboshi BankTokyo Kiraboshi Financial Group

Kiraboshi Bank, Ltd.

Tokyo Kiraboshi Financial Group, Inc.

The origin of the bank’s name

The ideas we wanted to put into the logo mark and color

Constellation. Twinkling stars.
We want to make the dreams of our customers glitter even brighterin the Tokyo area.
Into this name we put our desire for something clean cut that alsofeels easy to get to know, that takes the customers’ ideas into
safekeeping and uses them to bridge the way to the next generation.

Merger schedule

Effective date of merger
May 1, 2018

“Kiraboshi” is a design representing somebody facing forward and beginning to walk with head
held high, and represents our feeling of wanting to move forward with and contribute to the local
community, as a bank that rises to the challenge.
Expressing our desire to become a bank that places great value on the “ideas” of customers andemployees, and a gleaming presence in local communities, we used dark blue to symbolize“trustworthiness” and “sincerity,” while yellow represents “future promise” and “independence.”

Core systems to be consolidated
by the target date of FY2020○ At the point of merger on May 1, 2018

Tokyo Kiraboshi FG

ShinGinko Tokyo's systems will be consolidated with those of the Tokyo Tomin
Bank and the systems of the Yachiyo Bank and Tokyo Tomin Bank will beconnected via a relay system○ Unification of core systems
Tokyo Tomin Bank

Yachiyo Bank

ShinGinko Tokyo

Kiraboshi Bank

• By the target date of FY2020, Yachiyo Bank systems to be consolidated withthose of the Tokyo Tomin Bank to unify core systems• Subsystems to be consolidated in turn5

Business philosophy, management policy, overall strategy
Businessphilosophy

Management
policyWe contribute to the development of local communities through the provision of integrated services asa financial group for SMEs and individuals in the Tokyo metropolitan area.
Achieve enduring existence as a local regional bank through the provision of uniquefinancial services

A bank that sparkles

Leverage the special features of the Tokyo area to continue to meet new challenges inorder to contribute to the development of our customers and of local economies

A bank that rises tothe challenge

We put great value on the “ideas” of customers, the region, and our employees so as tobecome a necessary and always trusted presence

A bank that brings
together ideas

1. Fulfill the function of a true financial intermediary
by using close relationships with customers toresolve problems and practice support of theirmainstay operations

3. Leverage the special features of the Tokyo area tostrengthen our functions and offer new value bybuilding broadly based networks, as well as
unearthing new business areas

2. Offer consulting functions by leveraging contact
with the broad customer base to which we haveaccess as a local regional bank to display the
specialization within the overall group

4. Strengthen the management structure from a
medium‐ to long‐term perspective

Overall
strategy6Summary of business results
and profit plan7

Summary of business results for the fiscal year ended March 31, 2017 (1)[Tokyo TYFG consolidated]■ Business performance (Tokyo TYFG consolidated)■ Achievement rate (Tokyo TYFG Consolidated)(¥ billion)(¥ billion)*Amounts of less than 100 million yen have been rounded down

*Amounts of less than 100 million yen have been rounded down

Tokyo TYFG (Consolidated)

No.

*1

FY2015FY2016

Change1

Consolidated odinary income

79.5

83.0

3.5

2
3

Consolidated gross business profit

69.1
67.1

71.2
69.9

2.1
2.8

Consolidated gross core business profit

4

Net interest income

52.2

55.0

2.8

5

Net fees and commissions

12.4

12.6

0.2

6

Other business income

4.5

3.4

(1.1)

Ordinary profit

１

Profit attributable toowners of parent

FY2015
results

FY2016
forecast

Achievement
rate

Variationvs.
forecasts

8.3

8.9

93.2%

(0.6)

25.5

25.1

101.5%

0.4

7

Expenses

54.5

59.0

4.5

8

Credit‐related costs

1.8

2.8

1.0

9

Gains on stocks and other securities

0.6

1.1

0.5

10

Profit on investments based on theequity method

0.1

0

(0.1)

11

Others

0.8

(2.1)

(2.9)

12

Ordinary profit

14.4

8.3

(6.1)

13

Extraordinary profit

19.1

19.1

19.4

19.4

2016, the content of ShinGinko Tokyo’s accounts is not included in
the consolidated FY2015 results of Tokyo TYFG.

14Gain on bargain purchase*

0
－

*2

15

Income before income taxes

14.5

27.4

12.9

16

Income taxes

5.1

1.8

(3.3)

17

Net income

9.4

25.5

16.1

18

Profit (loss) attributable to non‐controlling interests

0

+0

25.5

16.1

19

Profit attributable to owners of parent

0
9.4

*2

Summary (1) Tokyo TYFG (Consolidated)① Ordinary profit posted of ¥8.3 billion was ¥600 million
below forecasts, but profit attributable to owners ofparent came in at ¥25.5 billion, exceeding forecasts by¥400 million.
*1 Because ShinGinko Tokyo only became part of the Group in April*2 Profit attributable to owners of parent of ¥25.5 billion includes¥19.4 billion in gains on bargain purchase related to the businessintegration with ShinGinko Tokyo.

8Summary of business results for the fiscal year ended March 31, 2017 (2)[Three‐bank total ∙ individual banks](¥ billion)■ Business performance*Amounts of less than 100 million yen have been rounded down.

Three bank total

Tokyo Tomin Bank(non‐consolidated)No.

Yachiyo Bank(non‐consolidated)(non‐consolidated)

ShinGinko Tokyo(non‐consolidated)

FY2015FY2016

ChangeFY2015FY2016FY2015FY2016FY2015FY2016

88.9

88.0

(0.9)

42.4

43.4

37.3

35.6

9.1

8.9

74.3
72.4

73.7
72.1

(0.6)
(0.3)

35.8
35.2

36.1
35.9

32.6
30.9

31.4
30.1

5.9
6.1

6.2
6.0

60.3

60.0

(0.3)

28.2

28.4

26.1

25.6

6.0

5.9

1

Ordinary income

2
3Gross business profit
Gross core business profit

4

Net interest income

5

Net fees and commissions

9.8

10.0

0.2

5.5

5.8

4.2

4.1

0

0

6

Other business income

4.1

3.5

(0.6)

2.0

1.7

2.2

1.6

(0.2)

0.2

1.9

1.6

(0.3)

0.5

0.1

1.6

1.3

(0.2)

0.2

7

１

Of which, gains (losses) on bonds,
etc.

57.4

57.7

0.3

28.4

28.6

25.1

24.9

3.8

4.1

9

Of which personnel expenses

29.1

29.2

0.1

13.3

13.4

14.1

14.1

1.6

1.5

10

Of which non‐personnel expenses)

24.9

24.5

(0.4)

13.6

13.3

9.4

9.0

1.8

2.1

8

Expenses11

Net core business income

14.9

14.3

(0.6)

6.8

7.3

5.8

5.2

2.2

1.8

12

Transfer to reserve for general possible loan
losses

(0.4)

(0.7)

(0.3)

(0.4)

(0.1)

－

(0.5)

－

－

13

Net business income

17.4

16.7

(0.7)

7.8

7.6

7.4

7.0

2.0

2.0

14

Non‐recurring profit (loss)

0.1

(4.6)

(4.7)

(1.1)

(2.8)

(0.2)

(2.8)

1.6

1.0

1.4

1.5

0.1

－

－

0.2

－

1.2

1.5

2.4

5.4

3.0

2.2

3.0

0.3

2.2

(0.2)

0.1

0.1

0.9

0.8

0.6

1.0

(0.4)

(0.1)

－

－

15
16
17

Of which, reversal of allowance for loan
lossesOf which, loss from write‐off of non‐performing loans
Of which, gains (losses) on stocks andother securities

18

Ordinary profit

17.6

12.1

(5.5)

6.7

4.7

7.1

4.2

3.7

3.1

19

Extraordinary profit (loss)

0.2

(0.3)

(0.5)

0.1

(0.2)

0

(0)

(0)

(0)

20

Income taxes

4.9

2.2

(2.7)

2.6

1.6

2.4

0.4

(0.2)

0.1

21

Net income

12.9

9.6

(3.3)

4.2

2.7

4.7

3.7

3.9

3.0

22

Credit‐related costs

0.3

2.9

2.6

1.8

2.9

0.1

1.7

(1.5)

(1.6)

23

Consolidated ordinary income

91.1

88.0

(3.1)

43.8

43.2

38.1

35.8

24

Consolidated ordinary profit

19.1

11.2

(7.9)

7.8

4.0

7.6

3.9

25

Profit attributable to owners of parent

13.6

8.2

(5.4)

4.7

1.7

4.9

3.3

２
３

Summary (2)① The three‐bank total (non‐consolidated) gross corebusiness profit fell ¥0.3 billion
from the previous fiscal year
due to declines in interest
income on loans anddiscounts, etc. caused by thenegative interest rate policy.
② The three‐bank total (non‐consolidated) net income
declined by ¥3.3 billion year
on year to ¥9.6 billion due toincreases in credit‐related
costs caused by the building
up of allowances, etc.
③ The three‐bank total profit
attributable to owners ofparent fell by ¥5.4 billion to¥8.2 billion.
* From the perspective of offering
information that allows
appropriate comparison ofdifferent periods, figures for
ShinGinko Tokyo from before thebusiness integration are includedin the “three‐bank total (non‐consolidated)” given for FY2015.

9Plan for the fiscal year ending March 31, 2018
■ FY2017 plan (Tokyo TYFG consolidated)(¥ billion)

FY2016
results

FY2017
plan

ChangeOrdinary profit

8.3

5.0

(3.3)

Profit attributableto owners ofparent*25.5

3.2(22.3)

Main factors behind forecast
for lower profit[Plan for the fiscal year ending March 31, 2018]
Due to the factors listed to the left, FY2017 is forecast to be a year of lower profit,
but by means of the following measures we will work to improve revenue.

○ Decrease in net interest income of ¥1.6 billion due to impact
of negative interest rate policy○ Expenses of roughly ¥1.9 billion posted in relation to theestablishment of the new Aoyama Head Office and theassociated relocation○ Expenses of roughly ¥2.2 billion posted in relation topreparations for merger○ Increasing loans to SMEs by strengthening initiatives for intellectual property
management support, management support based on evaluations of businessfeasibility, etc., and support for mainstay operations○ Increasing fees and commissions through the consulting business inpartnership with Kiraboshi Consulting, etc.

○ Special factor in FY2016 was the ¥19.4 billion in “gains on
bargain purchase” related to the business integration○ Strengthening the support structure for fostering SMEs, providing support forstart‐ups through enhanced collaboration with local governments and theirrelated organizations in Tokyo and other prefectures, and working with
regional banking groups, etc. to actively roll out measures to support
mainstay operations(Reference) *Profit attributable to owners of parent in FY2016 includes ¥19.4 billion in gains on bargain purchase related to thebusiness integration with ShinGinko Tokyo. If this special factor were excluded, profit attributable to owners ofparent in FY2016 would have been ¥6 billion.

○ The three‐bank total for credit‐related costs forecast to be ¥1.2 billion, due tosuch factors as the relative stability of business conditions for borrowers andcontinuous initiatives aimed at reconstruction support, etc.

■ FY2017 plan (three‐bank total and individual banks)
Three‐bank total

No.

FY2016FY2017

Change■ 30/3計画 （3行合算及び個別行）
results
plan

Tokyo Tomin Bank(non‐consolidated)
FY2016FY2017
Changeresultsplan

Yachiyo Bank (non‐consolidated)

ShinGinko Tokyo (non‐consolidated)

FY2016
results

FY2017
plan

ChangeFY2016
results

FY2017
plan

Change（億円）

1

Gross core business profit

72.1

70.3

(1.8)

35.9

35.5

(0.4)

30.1

29.2

(0.9)

6.0

5.5

(0.5)

2

Of which, net
interest income

60.0

58.4

(1.6)

28.4

27.9

(0.5)

25.6

25.0

(0.6)

5.9

5.4

(0.5)

3

Expenses

57.7

59.9

2.2

28.6

30.9

2.3

24.9

24.8

(0.1)

4.1

4.1

0

4

Net core business income

14.3

10.4

(3.9)

7.3

4.6

(2.7)

5.2

4.4

(0.8)

1.8

1.3

(0.5)

5

Credit‐related costs

2.9

1.2

(1.7)

2.9

1.4

(1.5)

1.7

1.1

(0.6)

(1.6)

(1.3)

0.3

6

Ordinary profit

12.1

8.4

(3.7)

4.7

3.3

(1.4)

4.2

2.9

(1.3)

3.1

2.1

(1.0)

7

Net income

9.6

6.4

(3.2)

2.7

2.1

(0.6)

3.7

2.2

(1.5)

3.0

2.0

(1.0)

8

Ordinary profit(consolidated)*

11.2

7.4

(3.8)

4.0

2.9

(1.1)

3.9

2.3

(1.6)

9

Profit attributable to ownersof parent (consolidated)*

8.2

4.8

(3.4)

1.7

1.3

(0.4)

3.3

1.5

(1.8)

*The figures for the consolidated three‐bank total are the total for Tokyo Tomin Bank and Yachiyo Bank on a consolidated basis, and ShinGinko Tokyo on a non‐consolidated basis.

10Interest income■ Status of interest income (three‐bank total)
Account

Item

FY2015(¥ billion, %)FY2016

Change3,477.5

3,570.7

+93.2

Yield

1.41

1.28

‐0.13

Interest

49.1

45.9

‐3.2

1,361.1

1,358.7

‐2.4

Yield

1.04

1.21

+0.17

Interest and dividends

14.2

16.4

+2.2

4,761.4

4,794.4

+33.0

Yield

0.06

0.04

‐0.02

Interest

3.0

2.0

‐1.0

Average balance

Loan

Average balance

Securities

Average balance

Deposits■ Measures to improve interest income
Securing loan yields○ Due to negative interest rate policies we expect loan yields to decrease, but we will work
to reduce the scale of the decline through such measures as strengthening our offerings
to customers with medium‐risk profiles, offering consulting functions, reinforcing ourfinancing for SMEs, and mining them for new opportunities.
Diversification of securities investments○ Diversifying investments to secure returns while keeping a close watch on market trends
Improve procurement costs (the deposit yield) through measures such as reviewing
preferential interest rate products○ Improve the deposit yield through means such as reviewing each preferential interest
rate deposit product and the interest rate premiums on large time deposits, andreinforcing demand deposits.

■ Status of interest income (by bank)■ Status of interest income (by account)(Figures within brackets are changes compared to end of the previous fiscal year;
percentages are change rates.)(Figures within brackets are changes compared to end of the previous fiscal year;
percentages are change rates.)(¥ billion)
ShinGinko Tokyo

YachiyoTokyo Tomin

61.4
4.5

26.9

29.9

60.3
5.5

25.6

29.1

[±0] ±0%[‐0.2] ‐3.6%[‐0.4] ‐1.5%[+0.5] 1.7%

60.3
5.3

25.2

29.6

[‐1.2] ‐1.9%[‐0.5] ‐9.4%[‐0.7] ‐2.7%[±0] ±0%59.1
4.8(¥ billion)

61.4

60.3

[±0] ±0%

Interest and dividends
on securities

12.4

14.2

[+2.2] 15.4%

Interest on loans anddiscounts

52.2

49.1

[‐3.2] ‐6.5%

(3.2)

(3.0)

[‐1.0] ‐33.3%

FY2014FY2015FY2016FY2014FY2015

16.4

24.5

45.9

29.6
Interest on deposits*1. Shows the total of interest rate spread and interest on securities.
2. Interest on negotiable certificates of deposit is included.

60.3

FY2017 plan

(2.0)
FY2016

11

Yields■ Yields (three‐bank total)

Loan yield(Figures within brackets are changes compared to end of the previous fiscal year.)

Loan yield[‐0.13 pt]

1.53[‐0.04 pt]

1.41
1.28

Yield difference

1.47

1.35

0.06

0.06

FY2014FY2015

Deposit yield○ In FY2016, due partly to negative interest rate policies, the three‐bank total loan
yield declined by 0.13 points year on year, but due to the use of financing
initiatives, etc. based on business feasibility evaluations, the fall in yields began to
improve in the 2nd half of the fiscal year.

[‐0.11 pt]

1.24[‐0.02 pt]

0.04
FY2016

1.24 %[‐0.03 pt]

1.21 %[‐0.01 pt]

0.03 %○ We expect further declines in loan yields as a result of negative interest rate
policies, but in addition to strengthening lending to SMEs and reinforcing
initiatives based on business feasibility evaluations, we will work on offering highvalue‐added services and finely tuned support to reduce the decrease in rates. Our
forecast for loan yields in FY2017 is 1.24%.

FY2017 plan

■ Yields (Tokyo Tomin)■ Yields (Yachiyo)■ Yields (ShinGinko Tokyo)(Figures within brackets are changes compared to end of
the previous fiscal year.)(Figures within brackets are changes compared to end of theprevious fiscal year.)(Figures within brackets are changes compared to end of theprevious fiscal year.)[‐0.17 pt]

Loan yield

1.49
Yield difference

1.45[‐0.12 pt]

1.36

1.24

1.55

1.22

[‐0.13 pt]

1.43

1.23 %
1.49

1.32

1.22 %

1.38[‐0.10 pt][‐0.02 pt]
Yield difference

0.04

0.02

FY2014FY2015FY2016

1.68
1.51

1.30

1.22 %

1.27

1.20 %[‐0.11 pt]

0.04

1.74

1.41

[‐0.02 pt]

0.01 %

0.06

0.05

0.03

0.02 %FY2017 plan

FY2014FY2015FY2016FY2017 plan

1.37[‐0.10 pt]

1.27

1.38 %

1.17 %[‐0.07 pt]

0.33

0.31

0.24

0.21 %FY2014FY2015FY2016FY2017 plan

12

Loans■ Composition of balance by region (three‐bank total)

Loan balances○ In total loans for the three banks, 80.3% were loans for small and medium‐sized enterprises(SMEs) and individuals, while in the regional breakdown, Tokyo metropolis and Kanagawa
Prefecture accounted for 99% of loans.

(As of end of March 31, 2017)

Kanagawa
Prefecture
15%○ The three‐bank total deposit‐loan ratio was 75.6%.
○ By using business feasibility evaluations to strengthen our support for customers withmedium‐risk profiles, we have devoted ourselves to refreshing our loan portfolio through the
expansion of lending to SMEs.

By
region○ We have reinforced our sales structure for corporate customers by opening the Tokyo Tomin
Bank Shinbashi Corporate Sales Division and the Yachiyo Bank Yokohama‐Nishiguchi Branch,
as well as by establishing the ShinGinko Tokyo Corporate Consultation Headquarters.

■ Loan balance by bank

ShinGinko Tokyo

Yachiyo

3,402.9

3,477.5 [+93.2] 2.6% 3,570.7 [+21.8] 0.6% 3,592.5

3,494.8
200.7

3,582.2 [+38.9] 1.0% 3,621.1 [‐34.2] ‐0.9% 3,586.9
222.5 [+8.0] 3.6% 230.5 [+0.3] 0.1% 230.8

1,466.0Tokyo84%

1,517.5 [+35.1] 2.3% 1,552.6[‐7.6] ‐0.4%

1,545.0(The numbers in white are average balances for the term; figures within brackets are changes
compared to end of the previous fiscal year; percentages are change rates.)(¥ billion)
Local governments
Medium and large‐
sized companies

SMEs

Tokyo Tomin

1,828.1

3,402.9

3,477.5[+93.2] 2.6%

3,570.7

3,494.8
161.1
565.8

3,582.2
183.9[+38.9] 1.0%

574.8[‐43.4] ‐7.5%

3,621.1
180.5
531.4

1,917.4

1,966.3[+79.1] 4.0%

2,045.4

850.3

857.2

[+6.4] 0.7%

863.6

FY2014FY2015[‐3.4] ‐1.8%

1,842.1 [‐4.2] ‐0.2% 1,837.9 [‐26.8] ‐1.4% 1,811.1
Individuals

FY2014*The region is classified
according to the location of
the branches.

■ Loan balance by type of customer (three‐bank total)(The numbers in white are average balances for the term; figures within brackets are changes
compared to end of the previous fiscal year; percentages are change rates.)(¥ billion)

Other
1%

FY2015FY2016FY2017 plan

FY201613

Loans by industry
Loan balance by industry○ Industries are relatively diversified, and loans by industry comprises a well‐balanced
portfolio.

■ Composition of loans by industry (three‐bank total)

Other
13%

Housing‐related loans○ In addition to moving ahead with the normalization of interest rates, we haveworked to promote specialty offices of Tokyo Tomin Bank Loan Plaza (fourlocations) and Yachiyo Bank Loan Center (five locations) and increase totaltransactions with individuals through such measures as work‐site sales by branches
to the employees of customers.

Individuals
24%

Services10%■ Loan balance by industry (three‐bank total)(As of March 31, 2017)

Manufacturing

9%3,621.1
billion yen

Real estateleasing
12%

Construction
5%
Commerce
12%
Banks andother financial
institutions
6%
Real estate
brokerage
9%(Figures within brackets are changes compared to end of the previous fiscal year.)(¥ billion)

3,582.2[+38.9]3,621.1

352.1
181.4
402.5

342.1
183.8
394.3

[‐16.5]

325.6
186.6
419.1

245.8
251.1

240.4
286.5

[+43.4]

209.0
329.9

409.1

423.7

[+12.1]

435.8

Real estate leasing

3,494.8[+2.8][+24.8][‐31.4]

Manufacturing
Construction
Commerce
Banks and otherfinancial institutions

346.9

358.7

[+13.2]

371.9

850.3

857.2

[+6.4]

863.6

Individuals

495.1

FY2014FY2015[‐16.0]479.1
FY2016(Figures within brackets are changes compared to end of the previous fiscal year.)

680.1

691.1

[+2.1]

693.2

Yachiyo

327.6

323.3

[‐5.5]

317.8

Tokyo Tomin

352.5

367.8

[+7.6]

375.4

FY2014FY2015

Real estate brokerage

Services455.2■ Housing‐related loans (Tokyo Tomin Bank and Yachiyo Bank)(¥ billion)

Other

FY2016*ShinGinko Tokyo does not handle housing‐related loans.

14

Deposits
Deposit balance○ The balance of deposits on a year‐end basis decreased ¥62.3 billion from the same
point in the previous fiscal year, but increased by ¥33 billion on an average balancebasis.

■ Composition of deposit balance by region (three‐bank total)
Kanagawa
Prefecture
21%○ By region, Tokyo metropolis and Kanagawa Prefecture accounted for 99% of thebalance.

ShinGinko Tokyo

Tokyo
78%

■ Deposit balance by client (three‐bank total)(The numbers in white are average balances for the term; figures within brackets are changes
compared to end of the previous fiscal year; percentages are change rates.)(¥ billion)

Other
1%

By
region○ Efforts made to increase balances by promoting the acquisition of corporate
demand deposits as well as pension and salary payment accounts and by increasing
personal deposits through the handling of deposit products in response to theneeds of various generations.

■ Deposit balance by bank

(As of March 31, 2017)

4,694.7

4,761.4 [+33.0] 0.7% 4,794.4

4,793.8
261.5

4,846.7 [‐62.3]
4,784.4‐1.3%
293.4 [+4.1] 1.4% 297.5

Yachiyo2,126.6

2,130.1 [+25.7] 1.2% 2,155.8

Tokyo Tomin

2,405.6

2,423.1

FY2014FY2015* Negotiable certificates of deposit are not included.

[‐92.2]‐ 3.8%[‐24.3]‐ 0.5%[‐21.4]‐ 0.4%[‐31.7]‐10.6%[‐17.8]‐0.8%(The numbers in white are average balances for the term; figures within brackets are changes
compared to end of the previous fiscal year; percentages are change rates.)

4,694.7

4,761.4[+33.0] 0.7%

4,794.4

4,846.7
194.7[‐62.3] ‐1.3%

Local governments, etc.

4,793.8
110.5[‐11.7] ‐6.0%

4,784.4
183.0

Corporate

1,361.8

1,374.0[‐18.3] ‐1.3%

1,355.7

Individuals

3,321.4

3,277.9[‐32.3] ‐0.9%

3,245.6

FY2014FY20154,770.1
4,763.0
265.8(¥ billion)

2,138.0

2,330.9 [+28.3] 1.2% 2,359.2

FY2016FY2017 plan

FY201615

Securities
Securities balance○ As a result of efforts to diversify and decentralize investments with the aim of mitigatinginterest rate risk and securing yields, such as by channeling redemption proceeds fromgovernment and municipal bonds into foreign bonds, the outstanding balance decreased¥102.2 billion from the previous fiscal year.
○ Within an environment of continued low interest rates, efforts will be made to thoroughly
ensure management of investment volumes, the amount of risk, and duration as we keep aclose watch on market trends while securing profits through flexible and diversified
investments in instruments including US government bonds, corporate bonds, andinvestment trusts.

[+0.17 pt]

Yachiyo5.3

5.5

ShinGinko
Tokyo

4.7
4.5

4.4

5.5 years
5.3 years

4.1 years

Tokyo Tomin

4.0
FY2014FY2015FY2016■ Securities balance by investment (three‐bank total)■ Securities balance and yields by bank (three‐bank total)(The numbers in white are average balances for the term;
figures within brackets are changes compared to end of
the previous fiscal year; percentages are change rates.) 1.04

■ Duration

1.21%(The numbers in white are average balances for the term; figures within brackets arechanges compared to end of the previous fiscal year; percentages are change rates.)

0.93
1,338.1(¥ billion)

1,393.3

1,361.1
1,373.2

ShinGinko
Tokyo

169.2

172.3

[‐2.4] ‐0.1%[‐102.2] ‐7.4%[‐11.4] ‐6.6%

1,358.7
1,271.0
160.9(¥ billion)
Other
securities

1,338.1
1,393.3
154.4
47.6

Stock
Yachiyo

637.9

613.9

427.0
[‐47.4] ‐7.7%

566.5

Corporate
bonds
Municipal
bondsTokyo Tomin

586.2

FY2014586.9

FY2015[‐43.4] ‐7.3%

543.5

FY2016

Government
bonds

120.1

1,361.1

1,358.7

1,373.2[‐24] ‐0.1%

213.2
39.8

[‐102.2] ‐7.4%

440.4[‐0.5] ‐1.2%

123.8[‐10.6] ‐2.4%[+40.9] 19.1%

1,271.0
254.1
39.3
429.8
71.6

644.0

[‐52.2] ‐42.1%

555.8[‐79.8] ‐14.3%

FY2014FY2015476.0

FY201616

Assets under management
Status of assets under management (Tokyo Tomin Bank and Yachiyo Bank)○ With regard to investment trusts, the deployment of our core/satellite
strategy resulted in a steady increase in core assets, but due in part to a
decline in the base value, the two‐bank total investment trust balance
declined by ¥7.1 billion year on year.

■ Outstanding balance (two‐bank total) of core funds(investment trusts)(¥ billion)○ The insurance balance grew by ¥5 billion year on year due to a decline in
the expected rate of return and the termination of sales for certain
products.

30.3
22.9

* ShinGinko Tokyo does not manage assets related to investment trusts,
insurance, etc.

8.2
FY2014■ Balance of assets under management by bank
(Figures within brackets are changes compared to end of the previous fiscal year.)

FY2015FY2016■ Balance of assets under management by item
(two‐bank total)(Figures within brackets are changes compared to end of the previous fiscal year.)(¥ billion)
YachiyoTokyo Tomin

500.7
196.5

304.2

FY2014

496.6

210.9

285.7

FY2015[‐16.1][‐0.3][‐15.8]480.5(¥ billion)

500.7

496.6

[‐16.1]

480.5

Public bonds

82.7

65.0

[‐14.0]51.0

Insurance

190.7

207.8

[+5.0]

212.8

Investment trusts

227.2

223.7

[‐7.1]

216.6

FY2014FY2015

210.6

269.9

FY2016FY201617

Problem assets subject to disclosure under the Financial Reconstruction
Law and credit‐related costs
Amount and ratio of problem assets subject to disclosure under the Financial
Reconstruction Law (in the case of partial direct write‐offs)○ The amount of problem assets subject to disclosure under the Financial Reconstruction
Law fell by 6.6 billion yen to 83.2 billion yen compared to end of the previous fiscal year
for the three‐bank total, while disclosure assets ratio dropped by 0.21 points to improve.
Credit‐related costs○ Although in FY2015 credit‐related costs reached ¥360 million due to reversal of allowance
for loan losses, etc., as a result of implementing an increase in allowances for certain
customers in the management improvement support program, the three‐bank total roseby ¥2.56 billion year on year to ¥2.92 billion. However, this was ¥1.08 billion less thanestimated and therefore within the range of forecasts.
○ Due to such factors as the relative stability of business conditions for borrowers and our
focus on reconstruction support, etc., we expect this to remain at low levels.
* While the three banks did not make any partial direct write‐offs, this states the figures in the caseof partial direct write‐offs.

■ Credit‐related costs (three‐bank total)(Figures within brackets are changes compared to end of the previous fiscal year.)■ Amount and ratio of problem assets subject to disclosure(three‐bank total)(Figures within brackets are changes compared to end of the previous fiscal year.)
Disclosure assets
ratio(¥ billion)
Substandard loans

Doubtful assets

Bankrupt and quasi‐
bankrupt assets

3.23
2.48

114.2
6.7

[‐0.21 pt]

2.27 ％

89.8
5.3[‐6.6]

77.1[‐5.1]

72.0

8.7

7.4

[+0.3]

7.7

FY2014FY201598.7[‐1.9]

83.2
3.4

FY2016■ Coverage status of problem assets subject to disclosure
under the Financial Reconstruction Law (three‐bank total)[Before partial direct write‐offs](¥ billion)(¥ billion)

FY2016

Covered amount
2.92
0.83
FY20140.36
FY2015

76.8

Reserve for possible loan losses

22.1

Collateral, guarantees, etc.

54.7

Problem assets

93.8

Coverage ratio

81.9%

FY201618

Capital ratio■ Consolidated capital ratio (Tokyo TYFG)
9.26

Capital ratio

8.65

Tokyo TYFG’s consolidated capital ratio○ 15 billion yen of Type 1 preferred stock issued through a third‐party allotment
to Sumitomo Mitsui Trust Bank, Limited on June 24, 2016. The financing wasappropriated through an investment in the subsidiary Tokyo Tomin Bank.

9.54%○ In FY2016, the consolidated capital ratio increased to 9.54% with the addition of
ShinGinko Tokyo to the scope of consolidation and the issuance of preferredstock.

(¥ billion)

Net assets

284.2

229.8

222.6

FY2014FY2015FY2016* Because ShinGinko Tokyo underwent business integration with Tokyo TYFG in April 2016,
it is not included in the results for FY2014 and FY2015.

■ Consolidated capital ratio (Tokyo Tomin)
Capital ratio

8.35

7.73

7.21%

115.2

108.8

104.0

■ Consolidated capital ratio (Yachiyo)
9.81

9.50

9.23%

107.4

110.3

112.1

■ Capital ratio (ShinGinko Tokyo non‐consolidated)
20.50

19.68

19.30%

56.9

60.5

61.9

FY2014FY2015FY2016(¥ billion)
Net assets

FY2014FY2015FY2016FY2014FY2015FY2016

19

Core OHR/ROE■ Core OHR (three‐bank total)

79.29

79.24

FY2014[+0.75 pt]

FY201580.04%FY2016

Core OHR○ Primarily due to intensifying competition and declines in interest income on loans anddiscounts resulting from the negative interest rate policy etc., gross core business profit
declined and the three‐bank total core OHR increased by 0.75 points over the previous fiscal
year.
ROE (consolidated)○ The three‐bank total ROE (consolidated) declined by 2.23 points year on year, due primarily
to profit attributable to owners of parent falling as a consequence of declining loan yields,
and to net assets that constitute the denominator in the equation being pushed up by theissuance of preferred stock.

■ ROE (consolidated)<Core OHR for each bank>

FY2014FY2015FY2014FY2016FY2015FY2016

Tokyo Tomin Bank

77.45%

80.58%

79.66%

Tokyo Tomin Bank

4.89%

5.08%

1.78%

Yachiyo Bank

82.33%

81.04%

82.74%

Yachiyo Bank

6.12%

4.53%

3.05%

ShinGinko Tokyo

73.59%

63.07%

68.81%

ShinGinko Tokyo

2.79%

6.82%

4.92%

Three‐bank total

79.24%

79.29%

80.04%

Three‐bank total

4.95%

5.24%

3.01%

*Core OHR =Expenses
Gross core business profit

× 100* ROE (consolidated) =Profit attributable to owners of parent

× 100(Net assets at the beginning of the period +net assets at the end of the period) ÷2* The consolidated figures are calculated as the total for Tokyo Tomin Bank and Yachiyo
Bank on a consolidated basis, and ShinGinko Tokyo on a non‐consolidated basis.

20

Special features of the Group“Strengths” and “Issues” faced by the Group in comparison to other regional banks of similar size
■ In comparison to regional banks with a similar total assets size, although we are in the upper half in terms of profitability (grossprofit), due to high branch costs and a heavy burden of expenses such as personnel expenses, on cost‐related indicators we are in
the lower half.
経Tokyo TYFG
(Three‐bank total)

51.5

Personnel
expenses

29.2

billion yen

10 regional banksof similar size
(average values)
Personnel
expenses

Expenses

Net interest
incomeTokyo TYFG
(Three‐bank total)

Expenses

60.0

billion yen

経Gross費
core business profit

費Gross core business profit

Net interest
income10 regional banksof similar size
(average values)

22.8

billion yen
Non‐personnel
Expensesbillion yen

10.0 billion yen

72.1

billion yen

Leveraging strengths
to implement measures
to further expand
revenueStrengths

No.2 out of 10 banks

Superior topline profitability
compared to regional banks ofsimilar size

17.7

billion yen
Income from fees
and commissions

7.2 billion yen

Non‐personnel
expenses

５７７億円
59.3

billion yen

billion yen

Issues

24.5

57.7

billion yen

Core business income

Core business income

14.3

Expenses, personnel expenses,
non‐personnel expenses

43.1

billion yen
Income from fees
and commissions

Gross core business profit, income
from fees and commissions, etc.

No.10 out of 10 banks

Heavy expenses burden pushes
down profit levels

16.2

billion yen

billion yen
Reductions in expenses
through comprehensive
implementation of
streamlining measures

Comparison between three‐bank total and 10 other regional banks of similar
total assets size for the purpose of analyzing our “Strengths” and “Issues”*Comparison using financial reports for fiscal year ended March 31, 2017, withthree‐bank total figures used for Tokyo TYFG

21

Future business strategy

22Tokyo TYFG’s business environment■ Tokyo area has high market potential
We have a large branch network in the Tokyo area, which has high market potential in the shape of future business opportunities arising from suchfactors as continued inward migration of regional companies and individuals, as well as further urban redevelopment
 Population (as of October 2016)

Ranking

Prefecture or
administrative divisionTokyo and Kanagawa Prefecture
account for 18% of the total
number of offices nationwide(Thousand)

1

Tokyo

13,6202

Kanagawa
Prefecture

9,140

SaitamaPrefecture
Chiba
Prefecture

Source: Statistics Bureau, Ministry of Internal Affairs andCommunications

 Number of offices (as of December 31, 2014)

Ranking

Prefecture or
administrative division(10,000 offices)

1

Tokyo

72

4

Kanagawa
Prefecture32

Source: Economic Census(％)

 Gross prefectural product (nominal) (FY2013)

 New housing starts (2016)

Ranking

Prefecture or
administrative division(Thousandsof units)

1

Tokyo

148

2

Kanagawa
Prefecture77

Source: Ministry of Land, Infrastructure, Transport and Tourism

 Percentage of foreign visitors to Japan visiting
each prefecture (2016)

Tokyo

Kanagawa
Prefecture

Branch network• Tokyo
124 branches• Kanagawa Prefecture
36 branches• Saitama Prefecture
3 branches• Chiba Prefecture
1 branch
Total

Ranking

Prefecture or
administrative division(%)

Ranking

Tokyo

48.2

2

Kanagawa
Prefecture

9.6

Source: Ministry of Land, Infrastructure, Transport and Tourism(Trillion yen)

1

Tokyo

93

4

Kanagawa
Prefecture30

Source: Cabinet Office, Government of Japan

 Number of university venture companies(FY2014)164 branches

Our 124 branches within Tokyo constitute thelargest number of any regional financial institution

1

Prefecture or
administrative division Going forward, the Tokyo area is expected to see further expansion in peripheral
financing demand due to urban and infrastructure development.

Ranking

Prefecture or
administrative division(Number ofcompanies)

1

Tokyo

467

2

Kanagawa
Prefecture

113

Source: Nomura Research Institute23

Tokyo TYFG’s course of action going forward

Fiscal year

2017

2018

2019

2020

2021

2022

Birth of
Kiraboshi BankKey events

Establishment ofcentral operations
centerIntroduction of new HR system

Completion of
AoyamaHead Office

Streamlining andefficiency‐improving
measures

Strategic rearrangementof branches

More than¥2 billion

Rebuilding of branch network
System consolidation

More than¥8 billion

2

Arrangement of new offices
Greater efficiency at headquarters

1

Measures to expand
revenue

Move to new sales structure

Improved efficiency of operations・decreased other costs
Customer‐oriented problem‐solving support (increasing loans to SMEs)
Establishmentof consulting
subsidiary

Strengthening consulting functions to raise revenue
Strengthening partnership promotion

24Synergistic effects from merger and merger consolidation costs■ Through revenue expansion measures and streamlining measures achieved through the one‐bank approach, we aim to achieve
the core business income target of 20 billion yen at the earliest possible date (FY2022)■ By thoroughly implementing streamlining measures and taking other steps to expand revenue in order to realize our vision for theCompany, we aim to achieve further growth in core business income
2

Synergistic effects from merger[core business income]1
Expenses of ¥2.0 billion
posted in relation to therelocation to the new
Aoyama Head OfficeMore than ¥8 billion① Improving headquarters efficiency‐¥4 billion

Fiscal 2017plan
¥10 billion
Base corebusiness income(FY2017)②Rebuilding of existing branch network
System consolidation, improved
efficiency of operations, otherefficiency measures‐¥4 billion

Reduce costs through comprehensive
implementation of streamlining
measuresMore than ¥2 billion①②

Customer‐orientatedproblem‐solving support(increasing loans to SMEs)¥20 billion

Strengthening consulting
functions to raise revenue③ Strengthening partnershippromotion
Expand revenue, etc. throughnew measures

Target for corebusiness income(FY2022)

Merger consolidation costs
Total investment in merger consolidation
FY2016¥1.1 billion of
expenses posted

FY2017¥2.2 billion forecast
to be posted*To be posted in “Other ordinary expenses”

Approx. ¥20 billion (system consolidation, replacing signage, handling customers)* Remaining expenses forecast to be posted in turn⇒25

Improving headquarters efficiency■ In line with the completion of the Aoyama Head Office in October 2017, from September 2017 onward the headquartersfunctions of the 3 banks will be consolidated, by department, to the Aoyama and Shinjuku offices■ Streamlining of headquarters staff: Structure of approx. 800 people⇒ reduce in stages to fewer than 400 people■ Streamlining of officers from May 2018 onward in line with the three‐bank merger

1
October 2017
Improving efficiency of headquarters functions

Streamlining measures (1)After completion of
Aoyama Head Office
Tokyo Tomin Bank
Yachiyo Bank

Aoyama Office

Unify systems
through consolidation
with a target of FY2020

May 2018
Three‐bank merger

Kiraboshi Bank

Aoyama Office

Streamlining of headquarters
staff

Headquartersfunctions to
be consolidated
by department

ShinGinko Tokyo

Shinjuku Office

Shinjuku Office

Streamlining of officers

Headquarters staff approx. 800 people

Headquarters staff less than 400 people

26

Shift to regional headquarters structure■ Shift to a 7‐region headquarters structure (trials scheduled
for the second half of FY2017)■ Enhancing customer satisfaction by unifying sales
teams for head office and branches○ In order to avoid opportunity losses, we will devolve significant authority tolocal offices to improve the sense of speed in responding to special features of
the region (market).

○ By unifying sales teams for head office and branches, we will establish asales structure that resolves customer problems and leads to enhanced
customer satisfaction.

Shift to a 7‐region headquarters structure (trials scheduled for the second half of FY2017)
Building omnidirectional
relationships
Tokyo Mirai Sales
Department(Entire Tokyo
Metropolitan area)

Seibu/Tobu Line
Region 2
Headquarters

Keio Line
Region 5
Headquarters

Regional Headquarters
Manager

Sobu Line
Region 1
Headquarters

Shinjuku
Head Office
Large
Sales
Region 3
Branches
Headquarters Department
AoyamaHead Office
Sales
Department
Odakyu Line
Tokyu Line
Chuo Line

Region 6
Headquarters

BranchManager

Region 4
Headquarters

BranchManager

BranchManager・・・

Yokohama/
Odakyu Line

Regional headquarters

Cooperation

Region 7
Headquarters

Kiraboshi Bank
Consulting division, Partnership Promotion Office, etc.

Respecting the factors involved for different paths (along railway lines)
into Tokyo, we will split into seven “regional headquarters” and appoint
regional headquarters managers with a certain amount of authority

Kiraboshi Consulting
External specialists, etc.
27

Strategic rearrangement of branches
Early implementation of branch‐in‐branch (BIB) structure centered around consultation services■ Reduce rental costs by implementing the BIB ahead of schedule in FY2018 . This will simultaneously generate personnel to reassign, andaccelerate the roll out of the customer‐orientated sales structure.
■ In the medium‐ to long‐term, we will develop offices centered around consultation services to meet customer needs (corporate offices,
individual customer plazas) .

1

FY2016FY2017FY2018FY2019FY2020

FY2021 onward★Legal merger
Cost reductions at branches“Generating personnel to reassign” and “Rolling out the customer‐oriented sales structure”

Streamlining measures (2)Phase 1

Phase 2

[Implementation of BIB]

[Acceleration of BIB]

Two offices already implemented(Kamata, Nishirokugo)
Two more planned going forward(Kinshicho, Joto)

Scheduled to be
implemented at another
15‐20 offices<Conceptual drawing of branch structure>

New (corporate)
New (individual)
StationStation[Branches specifically for
individuals]
Two locations already implemented(Higashi Fuchu, Kobuchi)
Around five more planned going forward

Flagshipbranches
Corporate
officeIndividualplaza

New (individual)

New (corporate)

StationStation28

Transformation to customer‐oriented sales structure throughuse of “dialogue”
 Building a customer‐oriented sales structure

課題解決に向けてアドバイザリー業務等を展開

・ By gaining high‐quality time with the customer, understanding their real needs and offering information and advice, we will establish a customer‐
oriented sales structure that will lead to enhanced customer satisfaction
Rapid changes in the business environment
・Contraction of profit margins due to negative interest rates ・Necessity of fulfilling fiduciary duties ・Accelerating progression of FinTech ・Accelerating restructuring of regional financial institutions, etc.

Carrying out customer surveys (implemented from October 2016)
Evaluation
・Building ongoing relationships with customers
・Basic contact, etc.

Maintaining and enhancing the “customer‐oriented sales structure”

Issues・Proposal creation capability/appeal of proposal
contents
・Level of satisfaction with capability to offer
information, etc.

1. Continued implementation ofcustomer surveys

2. Continued implementation of “bankemployee surveys”

By listening to a broad range of customers at
regular intervals, we will gain an objective
understanding of the issues that the Groupfaces, and reflect this in improvements andenhancements to management

Identifying
issuesBy taking enhanced customer satisfaction as a fundamental issue, our aim
is to become a financial institution that deploys advisory services■ Customer‐oriented sales structure
By raising the quality of our contact with customers, we will grow together with the customer throughsolution activities aligned with their needs

Qualitative improvements incustomer relationships

Based on the voice of the customer, we will
gain an understanding of the state of ourrelationship with customers, and of issues
and bottlenecks in customer‐facing services
and reflect this in improvements andenhancements to management

Establishing a customer‐
oriented sales structure

Identifying issues■ Provision of consulting functions
We will improve our capability to provide information and create proposals by means of a robust
structure for providing support from the headquarters to the sales offices, and leveraging consulting
companies and investment trust functions to match the stage of the customer’s life cycle■ Promotional structure suited to various regions and rebuilding of the branch network
We will build a flexible and agile promotional structure suitable for the special features of the region, andas well as moving forward with strategic rearrangements of branches and reassignments of personnel, we
will proactively make use of our distinctive network, including partnerships with local governments,
primarily the Tokyo Metropolitan Government, and other external organizations■ Transformation in awareness and activities of bank employees
By building an evaluation system that places a high priority on processes delivered through advisory
services that are aligned with customer needs, we will transform the awareness of bank employees anddeploy customer‐oriented activities

4. Reorganizing contacts andrelationships with the customer
As well as fundamentally rethinking thebranch network, sales structure, andoperations management, we will foster
human resources who are able to accurately
assess customer needs through dialogue,
and work to achieve a qualitative
improvement in customer relationships

3. Strengthening business process re‐engineering (BPR) initiatives
Strengthening
andtransforming
customer‐facing services

Based on the results of surveys, we will carryout business process re‐engineering in accord
with our medium‐ to long‐term vision for thebanks in the Group after the merger and after
consolidation of systems

29

Problem solving and mainstay operations support for SMEs based on
evaluations of business feasibility■ Fulfill the function of a true financial intermediary by using close relationships with customers to resolve problems and practicesupport of their mainstay operations
Financing based on evaluations of business feasibility (initiatives for intellectual property management support/asset‐based lending)2

Examples of strengthening initiatives for management support of customers based on evaluations of business feasibility
Understanding needs

Cash
flow
Businessfeasibility

Evaluationof businessfeasibility<

Repayment
amounts
Borrowings

・ Profit‐generating mainstay operations(positive cash flow)
・ Financial issues caused by past over‐investment, etc.

Intellectual
property
management

Resolving the gap
between cash
flow andrepayment
amounts

Cash
flow
Businessfeasibility

Vision aimed for

Use of ABL
Improvements in performance> Repayment
amounts

Capital investment

Borrowings

・Stabilize financing by restricting annual
repayments to within the range of cash flow
・Reduce administrative burden by
consolidating transactions with banks

Business succession

Creating shared value

Revenue expansion measures (1)Corporation

Finance advice

Normalization of financials

Bank

Increase in loan balance

Consulting fees

30

Strengthening of consulting functions■ April 2017 Kiraboshi Consulting Co., Ltd. established■ Expansion of advisory fees due to strengthening of consulting functions (business succession, M&A, etc.)
SMEs (owner‐managers)
Owner/family/employees

Customer

2

・Customer‐oriented customer
contact
・Unified sales for head officeand branches

Starting
point

Revenue expansion measures (2)Customer
contact(((Customer‐
oriented)))Advice/proposals

July 2016“Tokyo TY Consulting Group” establishedStrengthening customer support through three‐bank cooperative structure

April 2017

With the aim of further reinforcing Tokyo TY Consulting Group, established
Kiraboshi Consulting Co., Ltd.
(Made into direct, 100% subsidiary, active with 36 sales personnel)

High net worth individuals

Headquarters

Expand added value provided by offering highly specialized advice

Consulting division
Foreign exchange sales
department

Salesperson

Cooperation

Headquarters
coordination
staff

Partnership Promotion
Office (partnerships with
Cooperation
local governments)

Cooperation

Kiraboshi Consulting

External specialists<Main business areas>

FY2016 results

Information

Concluded

M&A/business succession

1,205

56

Inheritance‐related

1,970

393

Business matching

2,379

575

Overseas support/forex‐related

318

29

Use of affiliated companies, etc.

1,684

1,021

Other (real estate‐related, etc.)

2,278

647

Total

9,834

2,721

Business
succession

Business value assessment

Share price measures

M&A

Inheritance measures, etc.

Capital policy support

Creating
businessvalue

Strengthening
governanceSupport for drawing up business plans

Support for overseas expansion

M&A

Support for IPO

Transformation of profit structure, etc.
Support for human resources, labor

Building internal control system

Risk management

Restructuring of organization,businesses, etc.

31

Strengthening partnership promotion
 Strengthening collaboration with local governments such as Tokyo Metropolitan Government and related organizations (1)SME customers

2

September 29, 2015 “Agreement on a Comprehensive Affiliation for Industrial
Development in Tokyo” concluded with the Tokyo Metropolitan Government

Revenue expansion measures (3)・Support for small and medium enterprises (support
for commercial and industrial organizations,finance), support for tourism trade associations,agriculture and fisheries trade organizations, hiringand employment support, etc.

(Consultation)
Understanding
the voices anddesires of
SMEs

Public interest incorporated foundation(Guidance
activities)

Kanagawa Institute of Industrial Sciencegy
and Technology

Introducing
variety of
supportofferings

Support for resolving management issues andbusiness expansion for SMEs and micro‐
enterprises

Local independent administrative agency

Yokohama Industrial DevelopmentpCorporation

Overall management support

・Comprehensive support for SME management
issues (management consulting, subsidies, opening
sales routes, overseas expansion, use of intellectual
property, etc.)

Support for hiring and securing human resources

・Support for recruitment at SMEs experiencing
issues regarding securing human resources (posting
job offers, matching job offers to applicants, etc.)

Conveying the voices
and desires of SMEs.
Implementing policy
proposals, etc.

Tokyo Tomin Bank

Yachiyo Bank
Cooperation,
collaboration

ShinGinko Tokyo

Cooperation,
collaboration

Support problem‐solving and opening of sales
routes, etc. by offering consulting functions to
SMEs and micro‐enterprises

Kawasaki City, Kanagawa Prefecture
Supporting management issues of SMEs
(financing support, support for exchange ofintellectual property, support for start‐ups,
support for overseas expansion, and support for
securing human resources in areas such as hiringand employment)

Technology support

・Support for resolving technological issues for SMEs
(product development support, joint research,request for testing, technology consulting, etc.)

32

Strengthening partnership promotion
 Strengthening collaboration with local governments such as Tokyo Metropolitan Government and related organizations (2)2Main initiatives

Main initiatives● Individual consultation services for technological issues● Concentrated support for SMEs from the Tokyo Metropolitan Industrial
Technology Research Institute and the National Institute of Advanced
Industrial Science and Technology● Support for expanding overseas in partnership with Bangkok branch office● Hosting of various seminars for customers

Kawasaki City

Yokohama Industrial
Development
Corporation● Support for overseas business expansion (China, ASEAN,
etc.)● Support for establishing new companies, developing new
businesses, and transforming management, etc.
● Support for partnerships between industry and academia● Services for supporting the securing of human resources, and for disclosure ofcorporate information● Hosting of job fairs and hiring interview events for companies● Hosting seminars to support securing of human resources for customers

Tokyo Metropolitan
Industrial Technology
Research InstituteKanagawa Institute ofIndustrial Science andTechnology● Introductions for companies needing technologicalsupport● Provision of information to companies regarding
operations and events● Understanding company needs through the Kanagawa
branch network and sales activities, etc., and providing
this information to the prefectural industrial technology
center● Introducing specialists and support organizations in thearea of corporate management, etc. to the prefecturalindustrial technology centerTokyo Foundation
for Employment
ServiceTokyo Metropolitan Government● Asset‐based lending program designed by Tokyo
Metropolitan Government (ABL)● New Guaranteed Loan Program designed by Tokyo
Metropolitan Government (ORIX guarantee)● Incubation Hub Promotion Project (start‐up support)● Explaining Tokyo Metropolitan Government policies by
establishing the “Industrial Development Policy Corner”(rack made by materials from the Tokyo Forestry Office’s
Tama forest)● Participating in the “TEAM BEYOND” para sports fan site
● Participation in the “Welfare Infrastructure/Private
Property Matching Conference”

Tokyo Metropolitan Smalland Medium Enterprise
Support Center

Tokyo
Metropolitan
Government, etc.

Revenue expansion measures (3)● Gathering and providing information and carrying out
interviews related to Tokyo Metropolitan Government
policies, based on customer needs● Financing products linked to business feasibility evaluations business (“Jigyou
no Chikara”; “Strength of Business”)● Financing products linked to intellectual property strategy introduction
support business (“Chizai no Chikara”; “Strength of Intellectual Property”)● Participation in the financing advice corner of the “Tokyo Startup Station”
center for supporting the establishment of business (commencing handling ofstart‐up loans)●Support for overseas expansion in partnership with Tokyo SME Support Center,
Thailand Branch Office● Hosting of various seminars for customers● Support for cash flow of small‐ to medium‐sized construction companies(handling a public construction cost credit trust (“Contrust”) for construction
commissioned by Kawasaki City)● Hosting matching services for intellectual property that transcend the bordersof Kawasaki and Tokyo● Support for financing for entrepreneurs (commencing handling of loans for
those starting businesses)● Hosting of seminars for SMEs expanding overseas (event scheduled for July
2017)
● Support for human resources matching in partnership with “Career Support
Kawasaki”● Consulting services in partnership with Kawasaki City and Kawasaki Institute ofIndustrial Promotion“Industrial Development Policy
Corner” (rack uses materials from
Tokyo Forestry Office’s Tama forest)

Set up in 117 branches in Tokyo.
Provides wider exposure for leaflets
and pamphlets for various policies withregard to subsidies and seminars
conducted by the Tokyo Metropolitan
Government and related organizations

33

Strengthening partnership promotion■ Business tie‐up with Sumitomo Mitsui Trust Bank (June 2016)
Aim to expand fee business and customer base by offering sophisticatedfinancial services addressing diverse customer needs.

2

Expansion of fee business through business tie‐up

Measures to expand revenue (4)Tokyo Tomin Bank

■ Business tie‐up with Sky Ocean Asset Management Co., Ltd.
(August 2016)
By leveraging know‐how related to the “Core & Satellite
Management Strategy” we will work to improve our capability toprovide products that meet customer needs.

Contributing to stable asset formation by customers
In August 2016, the Bank of Yokohama, the Sumitomo Mitsui Trust Bank,
the Gunma Bank, and the Bank of Kyoto concluded a business tie‐up
agreement, including equity investments in asset management company“Sky Ocean Asset Management Co., Ltd.*”

Yachiyo Bank

*Established by the Bank of Yokohama and the Sumitomo Mitsui Trust Bank

■ Main products and services
for corporate customers inwhich we have tie‐ups
・Business matching・Mortgage‐backed loans
・Credit securitization
・Financing (syndicate loans,real estate non‐recourse
loans, etc.)
・Corporate revitalization
business
・M&A, business succession
consulting
・Overseas offices business・Lease operations■ Main products and services
for individual customers inwhich we have tie‐ups
・ Will trusts and inheritancearrangements
・ Products that contribute toasset management
・ Mortgage‐backed loans, etc.
・ Reciprocal removal of ATM
fees We will provide customers with investment products, set up andmanaged by Sky Ocean Asset Management, that contribute to thestable medium‐ to long‐term management of assets
 We will acquire the know‐how of Sumitomo Mitsui Trust Bank related
to “Core & Satellite Management Strategy”

By strengthening our consulting sales capabilities,
we will contribute to the stable formation of assets
by customers
34

Strengthening partnership promotion■ By building our support network for mainstay operations so that it links the Tokyo area with other regions, we will strengthen
our consulting functions and support SMEs

2
Jimoto Holdings, Inc.
Kirayaka Bank, Ltd.

The Senshu Ikeda Bank, Ltd.

Date agreement
concluded

Measures to expand revenue (5)Date agreement
concludedPartnership
name

January 2017

Partnership
name

An agreement on a Tokyo‐Osaka partnershipthat “connects” the Tokyo and Osaka areas

Details ofpartnership(1) To connect “work”① Support for business matching using trade fairs
and exchange exhibitions② Reciprocal use of China and Southeast Asian
offices(2) “Connecting” companies
 M&A support(3) “Connecting” people Joint development of services for local
residents

Details ofpartnership

The Sendai Bank, Ltd.

November 2016
Mainstay operations support
network(1) Cooperation and collaboration regarding
support of mainstay operations① Matters related to support operations, etc.
for business succession/M&A and so on② Matters related to business matching
operations(2)Hosting of information exchange meetingsand joint training, as well as the fostering andexchange of specialized human resources,
with the aim of sharing and increasing know‐how held within the two Groups relating tosupport for mainstay operations

Scheduled future collaborations● Implementation of high‐quality business matching● Strengthening M&A initiatives● Implementation of other initiatives to support themainstay operations of customers

Scheduled future collaborations● Hosting individual trade fairs (Tokyo,
Osaka)● Hosting of joint seminars and trade fairs,
etc. overseas● Collaboration on seminars regarding
business succession and M&A● Implementation of other initiatives tosupport the mainstay operations ofcustomers

Tokyo Tomin Bank

Yachiyo Bank

ShinGinko Tokyo

35

Initiatives to support start‐ups■ Used the three‐bank cooperative structure to set up a “Start‐Up Support Group” dedicated to supporting founders andentrepreneurs in February 2017.
■ The “Start‐Up Support Group” makes it possible to provide flexible, one‐stop, hands‐on support for founders, entrepreneurs, andstart‐ups, enabling sales offices and headquarters to work together to assist those facing the challenge of founding new
businesses.

Drawing
up plans

Corporation,
etc.

Founders,
entrepreneurs

Start‐Up Support Group

Consulting

Start‐up support incooperation with sales
offices

Building of incubator andother networks

Active participation in pitch
events (sprout, etc.)

Conducting all kinds ofseminars for founders andentrepreneurs

Start‐up companies
Rapidly growing
companies andorganizations facing thechallenge of creating
markets and businessmodels from scratch

Partnership

Cooperation

Variouskinds ofsupportSales offices (Shibuya Start‐up Support Office, etc.)
Tokyo TYFG

Number of start‐ups in which financial institutions wereinvolved

FY2015 FY2016

External start‐up support agencies

Preparation/
investigation

Local governments, including Tokyo
Metropolitan Government, andaffiliated organizations
Venture capital
Various incubation facilities
・Machida Business Development Agency
・Sagamihara Incubation Center, etc.

Various specialists

Tokyo Startup Station

Crowdfunding operations business

247

288

Support for drawing up start‐up plans

31

41

Tokyo TYFG

Financing to customers during start‐up period

142

190

Introducing financial agencies affiliated with thegovernment and institutions supporting start‐ups

54

53

Number of start‐ups supported in partnershipwith local government organizations, etc.

Subsidies, financing, and investment in venture businesses

20

4FY201652

36

Support of medical/welfare field■ In an environment characterized by the aging of society and a declining birthrate, we have positioned the “medical/welfare field”
as a growth area and a local industry for the Tokyo Metropolitan area, to which we will provide multifaceted assistants not only
through financing but also through support for mainstay operations■ We have set up the “Medical and Welfare Division” as a department specializing in this field. We have leveraged the know‐how
accumulated over the 14 years since it was set up to achieve steady growth in the loan balance
Consulting support of medical/welfare field
Medical corporations,private practitioners, andbusiness operators in areas related
to caregiving
Cooperation with Group
companies, etc.

Financing activities

Unit: ¥100 million

800
700

642

400

665

703

731

585

600
484

500

Specialized
medical/welfare
department
Cooperation with Medical andWelfare Administrative Structure
K.K.

Tokyo Tomin Bank Loan balance in medical/welfare field

343

359

394

420

300

Business mediation
activities

200
100
0
March
2008 March2009 March2010 March2011 March2012 March2013 March2014 March
2015 March
2016 March2017
2008/3期
2009/3期
2010/3期
2011/3期
2012/3期
2013/3期
2014/3期
2015/3期
2016/3期
2017/3期

37

Support for expanding overseas‐related business■ For overseas‐related business support for SMEs, primarily in Asia, we make use of Tomin Business Consulting Shanghai Co., Ltd., the only consulting
affiliate of a regional bank, and form business tie‐ups with local banks in China, Thailand, Vietnam, and other Asian countries■ We also utilize tie‐ups with the overseas offices of public organizations such as the Thailand Branch Office of the Tokyo Metropolitan Small and Medium
Enterprise Support Center, the Bangkok office of the Tokyo Metropolitan Industrial Technology Research Institute, and JETROThe number of counterparties for Tokyo TYFG foreignexchange‐related transactions (corporates, owner managers)
was approximately 2,900 (second half of FY2016)
We have business tie‐ups with the Bank of Beijing, the Bank of Dalian, the Bank ofNingbo, Ping An Bank, and the Bank of Jiangsu (Wuxi Branch)

Our customers’
Chinese offices
Shanghai local subsidiary

State Bank of India

Bank for Investment and Development of Vietnam

Thailand Kasikornbank

Our track record in terms of trade transactions handled is one of the best outof all regional banks nationwide(FY2016 results)
Import transactions (outward remittances/import settlements)
39,381
Export Transactions (incoming remittances/purchase of export bills) 10,892

Ordinary foreign exchange handling volume
3,000(Unit: one million dollars)

2,842
2,603

The Philippines Metropolitan Bank and Trust Company

Our customers’ other
Asian offices

Bank Negara Indonesia

2,468

2,500

2,000
2015/3期
March
2015

2016/3期
March
20162017/3期
March 201738

Initiatives for supporting SMEs that make use of the funding
function■ Support of SMEs that makes use of the funding function■ We support SME growth in a way that matches the life stage of the company by investing in funds that target SMEs that are forecast
to grow going forward, and in funds that aim to support companies that are revitalizing themselves■ Introductions for LBO financing arise from funds in which we have invested, building a favorable environment for acquiring newtransaction opportunities
Support for SMEs matched to their life stages

Tokyo Tomin Bank

Yachiyo Bank

Equityinvestment

Venture funds[Supporting
start‐ups]

Expansion of newtransaction
opportunities such as
LBO financing

ShinGinko Tokyo

Equityinvestment

ＥＸＩＴ

Revitalization
funds[Supporting
revitalization]

Investments in
funds¥12.2 billion,
55 counterparties

Improvements
in corporate
value

Investments in funds

140
90

100
73

60
40
20

38

48

March
2014
2014/3March
2015
2015/3

55

March
2016
2016/3March
2017
2017/3

Investments

Investments

Growthperiod490Investment amountStart‐upperiod

122

111

120
80

Equityinvestment

Private equity funds[Supporting growth]

Investments

Units: ¥100 million,
numberMatureperiodStagnation
periodNumber of investments(Unit: ¥100 million)

March 2015

March 2016

March 2017

LBO financing
executed

32

50

68

Revitalization
period39

Strengthening solutions that make use of the trusts function (1)■ “Contrust,” a public construction cost credit trust■ This is a trust product that is backed by the credit strength of the entity placing orders for public works, enabling contract payments for public works to
be converted into funds quickly and with agility■ Since February 2016 the entire Group has been using Contrust products, after the Tokyo Tomin Bank and the Yachiyo Bank introduced them to ShinGinko
Tokyo■ On April 1, 2017, ordering entities covered by this product were expanded to allow it to be used with public works construction orders placed by Taito
Ward, Meguro Ward, Nakano Ward (all part of Tokyo), and Kawasaki City (Kanagawa Prefecture). In addition, Kawasaki City was the first public works‐
ordering entity permitted to use this outside the Tokyo Metropolitan Government (as of April 1, 2017, 48 local governments, etc.)
Eligible public works‐ordering entities (48 local governments, etc. as of April 1, 2017)<Local governments>
Cumulative investment
trust agreements
2,000
Exceeds ¥200 billion

Units: ¥100 million, number
Cumulative investment
trust agreements

・・・提携団体（２１区・１８市町村）
Organizations in alliance(21 wards, 18 local governments)

奥多摩町
青梅市

清瀬市

瑞穂町
羽村市

2500

2,150

60

杉並区

墨田区
江戸川区

千代田区

府中市

日野市

台東区

新宿区

三鷹市

国立市
八王子市

文京区

中野区

武蔵野市

国分寺市

荒川区

豊島区

小金井市

渋谷区

中央区

調布市

江東区

港区
世田谷区

40

1000
500

西東京市
小平市
立川市

1,529

葛飾区

練馬区

福生市
あき る 野市
昭島市

1,739

足立区
北区

東久留米市
東大和市

檜原村

1,943

2000
1500

80

板橋区

東村山市
武蔵村山市

日の出町

多摩市

稲城市

狛江市

目黒区

品川区

町田市

1,205

1,506

1,729

2,001

0

0
March
2014
2014/3March
2015
2015/3March
2016
2016/3Introduced through Group
Agreement value
Number of agreements

March
2017
2017/3

大田区

20
川崎市

小笠原村

<Tokyo Metropolitan Government and affiliated organizations>Tokyo Metropolitan Government, Tokyo Metropolitan Housing Supply Corporation, Tokyo Urban Planning and Development
Corporation, Tokyo Metropolitan Public Corporation for Road Improvement and Management, Tokyo Port Terminal Corporation,
Japan Motor Terminal Co., Ltd., Tokyo Metropolitan University, Yurikamome Inc., Tokyo Tama Intercity Monorail Co., Ltd.
(titles omitted, no particular order)

40

Strengthening solutions that make use of the trusts function (2)■ Real estate management trust■ Based on Article 3 of the Act on Engagement in Trust Business Activities by Financial Institutions, in May 2017, ShinGinko Tokyo obtained approval to add“Real estate management trust” to the types of trust business and to amend the statement of operation procedures■ Advantages of real estate management trusts① Because the real estate can be converted to a trust beneficiary right and transferred to a third party, the off‐balance sheet effect improves financial
indicators② Converting the real estate to a trust beneficiary right enables diversification of funding measures③ By outsourcing administration related to possession of real estate, the burden of clerical work is reduced[Scheme example]

Owner of real estate(trustor and trust
beneficiary)① Real estate management trust agreement
ShinGinko Tokyo① Issuance of trust beneficiary right

当行(trustor)⑤ Financial reports, trust dividends② Rental payment(via PM)② Rental contract

Tenant(Renting person)
Instructions

Asset Manager(AM)

ReportManagement of tenants and building

Property manager(PM)③ Real estate management
Outsourcing agreement④ Instructions for management/operations

41

FinTech initiatives “Maekyu”‐Rising to the challenge of new business domains‐■Strengthening the functionality of the “Maekyu” platform and putting it to good use gives us a foothold in the FinTech business,allowing us to challenge new business areas.
■The “Maekyu” business is a service that allows part‐time and temporary staff working at companies to fulfill their various fundingneeds before payday.* Against the backdrop of recent labor shortages, it is being deployed by an increasing number of companies
aiming to secure staff and improve retention ratios through offering generous benefits, and has grown into an important source ofincome for the Group.
*An account with the Group is not necessary to use the “Maekyu” service, but it is necessary for the employing company to conclude a contract
with Tokyo Tomin Bank.
Previous business model for “Maekyu” operations
Approx.
1.08 million people654
companies

Wages

After subtracting“Maekyu” usage amount

Personnel
Part‐timers, temporary
staff, etc.

Paying inApplication for use“Maekyu”‐use
deductions data

Attendance
management data

Basic user data

Tokyo Tomin Bank
“Maekyu System”

700
Number of employees
registered
Number of companies
contracted

650
600

654

1,000,000
900,000

599

800,000
550

544
1,084,157

500

700,000

501
600,000
459

450
400
350

*Employee data is continuously being updated with new data
*The special feature is the function that enables direct settlement (deductions from wages)

1,100,000

500,000

647,574415
386,097

797,925
556,733

Number of employees registered

Deductions
from wages

Continuous
turnoverimplemented

Number of companies contracted

Operatingcompany“Maekyu” business, number of contracts, number of employees registered

400,000

446,735

300,000
March 2012

March 2013

March 2014

March 2015

March 2016

March 201742

FinTech initiatives “Maekyu”‐Rising to the challenge of new business domains‐■The affinity between “Maekyu” service and FinTech
・Part‐time and temporary staff comprise mostly housewives, students, and so on who own mobile terminals, and we expect
to expand business opportunities with regard to the progress of FinTech among these customers by rolling out new services
using the network environment of these mobile terminals (non‐face‐to‐face channels) at an appropriate time.
・Going forward, in environments where FinTech businesses are expected to gain ground, we aim to offer new added value tothe 1.08 million people who are registered, thus taking a step beyond the “Maekyu” business model that depends mainly on
the existing paying in commission as a source of income. With the goal of winning new revenue opportunities we areconsidering tie‐ups with FinTech venture companies and are considering starting the building of a new business model.
Business model for future “Maekyu” business (conceptual drawing)
Approx. 1,000 plus
Companies thathave adopted

Approx. 1.50 million plus

Deductions
from wages

Personnel
Wages

Enhanced functionality

FinTech companies

Business opportunities

Business opportunities

Service provider
companies

Service provider
companies

Tie‐ups/alliances

Improved revenue
opportunities

B2C
Service provider
companies

Tie‐ups/alliances■ Payment
Product purchaseCashless■ Sales of financial
products■ Transaction lending■ Benefit services
・Travel・Education
・Relocation, etc.

Tie‐ups/alliances“Maekyu System”

EC sites
Paying inApplication for use

Added value provided“Maekyu”‐use
deductions data

Attendance
management data

Basic user data

Stable workforce[improved retention ratio]
Generous benefits services

Enhanced functionality

Offering of new services

After subtracting“Maekyu” usage
amountFinTech companies

Part‐timers,
temporary staff, etc.

Kiraboshi Bank

*This might include companies becoming B2C service providers

43

CSR initiatives

44

CSR initiatives
Stance of the Tokyo TY Financial Group towards CSR
The Tokyo TY Financial Group views the implementation of CSR management and contributing to the formation of sustainable local communities to be an essential management issue. Based on the
management policy of “the development of local communities through the provision of integrated services as a financial group for SMEs and individuals in the Tokyo metropolitan area,” we haveestablished the three action guidelines of “contributing to the regional economy,” “contributing to local communities,” and “initiatives towards environmental issues,” and we will actively
engage in CSR activities.

■ Contributing to the regional economy
Holding of TOKYO TY Business Interchange 2016
The TOKYO TY Business Interchange 2016 was jointly held by the three banks in May 2016. It enabled extensive matchingamong the 7,100 visitors and 155 participating companies.

■ Contributing to local communities
Participating in the “TEAM BEYOND” para sports fan site

Initiative for training “dementia supporters”

We participate in a fan site set up by the Tokyo Metropolitan Government
to boost interest throughout society in para sports (sports for people withdisabilities). In addition to the Company and the three subsidiary banks
registering at this site, we encourage officers and employees to register
and work together to promote para sports.

With the aim of achieving local communities in which those
suffering from dementia and their families can have peace ofmind in their daily lives, we are carrying out an initiative to train“dementia supporters.”■ Initiatives towards environmental issues
Collaboration with “Fundraising to build forests
with less pollen”
We donate an amount equivalent to a fixed rate applied to thebalance of “building forests with less pollen” deposit accounts
to the “Fundraising to build forests with less pollen” program
operated by the Tokyo Development Foundation for
Agriculture, Forestry and Fisheries.

Implementing cleaning activities on the Tama and Sagami rivers
Personnel of the three banks and their families work together to carry out
cleaning activities on the Tama and Sagami rivers, getting involved throughthe Group in initiatives aimed at environmental problems. These activities
were also attended by children, so that the program also had an educational
aspect.

45

Thank you for attending this presentation today.
■ Please direct any comments or questions about these briefing
materials or other IR topics to the IR officer below.
Tokyo TY Financial Group, Inc. Corporate Planning Division
The Tokyo Tomin Bank, Limited
Corporate Planning Division, Public and Investor Relations Office
TEL +81‐3‐3505‐2155
E‐mail IR@tominbank.co.jp
The Yachiyo Bank, Limited
Corporate Planning Division, Investor Relations Section
TEL +81‐3‐3352‐2295
E‐mail IR@yachiyobank.co.jp
ShinGinko Tokyo, Limited
Corporate Planning Division
TEL +81‐3‐6302‐3958
E‐mail IR.kouhou@sgt.jp

This document contains forward‐looking
statements on the Group’s results. Thesestatements are not intended to guarantee
future results, as they are subject to risks
and contain uncertainties. Please keep inmind that future results may differ due tofactors including changes in the businessenvironment.

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