Tokyo Kiraboshi Financial Group

Results Briefing for the Fiscal Year
Ended March 31, 2022

May 30, 2022

Contents

Tokyo Kiraboshi FG

Highlights of Todayʼs Briefing

P.3

Strategy of the Medium-Term Business Plan and Related Indicators(KPIs) – Initiatives to Address ESG/SDGs

P.22

Status of Progress on the Medium-Term Business Plan

P.4

Corporate Customer Strategy ① (Loans)

P.23

Corporate Customer Strategy ② (Commission Income)

P.24

Corporate Customer Strategy ③ (Equity and Mezzanine Finance)

P.25

Corporate Customer Strategy ④ (Medical Institutions and TrustBusiness)

P.26

Tokyo Kiraboshi FG Results for the Fiscal Year Ended
March 31, 2022
Summary of Business Results for the Fiscal Year Ended March 31,
2022

P.6

Factors Affecting Net Income (Kiraboshi Bank)

P.7

Profit from Customer Business (Kiraboshi Bank)

P.8

Retail Customer Strategy ① (Assets Under Management)

P.27

Plan for the Fiscal Year Ending March 31, 2023

P.9

Retail Customer Strategy ② (Life Plan Support Business)

P.28<Plan for the Fiscal Year Ending March 31, 2023>
Factors Affecting Net Income (Kiraboshi Bank)

P.10

Improvement of Management Efficiency ① (Expenses)

P.29

Shareholder Returns (Dividend Policy)

P.11

Improvement of Management Efficiency ② (Branch Strategy)

P.30

Improvement of Management Efficiency ③ (Employee Numbers)

P.31

Capital Policy

P.32<Reference> Summary of Business Results for the Fiscal
Year Ended March 31, 2022
Loans and Trust Assets (Kiraboshi Bank)

P.13

Deposits and Assets under Management (Kiraboshi Bank) +UI Bank + KLD Securities

P.14

Securities (Kiraboshi Bank)

The Kiraboshi Groupʼs Actions for the Future
Digital Strategy of Kiraboshi Group

P.34

P.15

Digital Bank (UI Bank)

P.35

Problem Assets Subject to Disclosure under the Financial
Reconstruction Law and Credit-Related Costs (Kiraboshi Bank)

P.16<Reference> UI Bank Results

P.36

Capital Ratio/Core OHR/ROE

P.17

Kiraboshi Tech, Inc. (Maekyu/LaLaPay)

P.37

Digital-based, Tokyo-based Platform Concept ①

P.38

Digital-based, Tokyo-based Platform Concept ②

P.39

Progress on the Medium-Term Business Plan
Overview of the Tokyo Kiraboshi Financial GroupP.19

Further Promotion of Partnership with External Organizations

P.40

Management Base of Kiraboshi Group

P.20

Sustainability Initiatives

P.41

Financial Targets under the Medium-Term Business Plan (KGIs)

P.21

2

Highlights of Todayʼs Briefing

Tokyo Kiraboshi FG

１. Tokyo Kiraboshi FG Results for the Fiscal Year Ended March 31, 2022
● Revised financial results forecasts upward and increased dividends in the first year of the Medium-Term Business Plan (FY2021)● A further increase in profits is forecast under the FY2022 plan, with an increase in dividends to achieve shareholder returns commensurate with the level ofprofits

２. Progress on the Medium-Term Business Plan
Previous Medium-Term Business Plan <Review>

Start-up ☆Kiraboshi

Medium-Term Business Plan <Progress Report>

Vision of the future: Comprehensive service business that is also strong in financeBe a Tokyo-based platform owner that creates new values for customers
Reform of the Management Baseand Business

Existing Kiraboshi Bank Strategy
Improvement of management efficiency(systems integration, reconstruction of
branch network, improvement of
headquarters efficiency)

Stronger sales strategy and structure
Main bank relationship PJ, businessfinancing, first-call, no-load features

Enhance the Group structure■ The thorough cost-reduction measures
implemented under the previous Medium-TermBusiness Plan have contributed to an increase inproductivity and an improvement in OHR＋■ Increase loan balance(Strive to achieve the target balance in the 3rdyear of the Medium-Term Business Plan)■ Increase commission income from corporate
customers■ Increase the balance of investment trusts and fundwraps
■ Structure the Group to be a comprehensive service
business that is also strong in financeDigital-based platform

concept

Enhance Groupcapacities to provide

non-face-to-face,non-financial services

３. The Kiraboshi Groupʼs Actions for the Future● Digital strategy of Kiraboshi Group (launch UI Bank/LaLaPay digital wallet)● Tokyo-based platform concept● Sustainability Initiatives

3

Status of Progress on the Medium-Term Business Plan

Tokyo Kiraboshi FG● Achieved results exceeding targets in the first year of the Medium-Term Business Plan
Financial Targets (KGIs)
2021/3＜Results＞

2022/3＜Plan＞

2022/3＜Results＞

1.3%

3.2%

5.7%

178%

◎

② Core OHR <Kiraboshi Bank non-consolidated>

75.7%

67.0%

65.3%

102%

〇

[Ref] Expenses(Including non-personnel expenses)

524
229

499
216

514
237

97%
91%

-

③ Net income <consolidated>

41

100

181

181%

◎

④ Profit from customer business <Kiraboshi Bank
non-consolidated>

14

124

126

102%

○

⑤ Contribution of subsidiaries to consolidated
income <consolidated>

3

(4)

1

-

8.7%

8.6%

8.4%

98%

Medium-Term Business Plan KPIs

② Productivity③ Life plan support
business④ DX⑤ Corporate customer
strategy<Achievement
rate>

Achievementlevel2024/3＜Plan＞

3.7%

115%

◎

５.9%

67.9%

99%

〇

57.3%

514

97%

-

467

237

91%

-

205

116

117%

◎

200

126

102%

〇

234

○

1

-

〇

23

△

8.2%

95%

△

8.3%

<Achievement level: ◎...Surpassed; 〇...Achieved or nearly achieved; △...More work needed>
2021/3＜Results＞① Branch strategy

2022/3＜Results＞

rate>① ROE <consolidated>⑥ Capital ratio <consolidated>

Note: Excluding special factors

Achievement
level<Achievement
Excluding special factors(Monetary unit: ¥100 million)<Achievement level: ◎...Surpassed; 〇...Achieved or nearly achieved; △...More work needed>

2022/3＜Results＞<Rate ofprogress>

Achievement level2024/3＜Plan＞

Offices for corporate and retail customers, and offices
specializing in corporate customers

91 offices

50 offices-〇

54 offices

Retail-focused branches

20 offices

56 offices-〇

34 offices¥25 million¥29 million

90%〇¥32 million

Number of transactions with business owners-+1,780

178%

◎

1,000

Balance of transactions with business owners-+¥17.9 billion

35%〇¥50.0 billion

Kiraboshi Package (*)-

27,10745%〇

60,000Gross core business profit per head

76,000 users

151,000 users

23%△

400,000 users

Number of loan customers with annual sales of ¥0.3–10.0
billion in main bank relationshipTotal amount of loans to customers with annual sales of¥0.3–10.0 billion in main bank relationship

-

+723

120%

◎

600

-

+¥154.2 billion

25%△¥600.0 billion

Number of business succession support customers

-

388

38%

〇

1,000

Number of medical transaction support customers

-

210

52%

〇

400

Individual Internet users(*) Kiraboshi Package: Products and services mainly to address property management and property succession needs in the older adult segment

4Tokyo Kiraboshi FG
Results for the Fiscal Year
Ended March 31, 20225

Summary of Business Results for the Fiscal Year
Ended March 31, 2022
Kiraboshi Bank
(non-consolidated)(¥100 million)

1

Gross core business profit

2

Net interest income

2021/3A

2022/3
B

692

[Ref]
2022/3plan

Tokyo Kiraboshi FG(consolidated)(¥100 million)

2021/3A

Difference(B-A)

Excludingspecialfactors

786

+94

756

745

Ordinary profit

82

587

656

+69

626

606

Profit attributable toowners of parent

41

463

498

+34

498

488

+25

121

120

3

Of which, interest on
loans and discounts

4

Of which, interest on
securities

126

5

Including other interest
income

(2)

6

+8

6

(3)

6

Non-interest income

104

129

+25

129

139

151

*1

*1

2022/3B*3*3*3

Tokyo Kiraboshi FG
Excludingspecialfactors

Difference
(B-A)

+167

184

152

181

+140

116

100

*3 Recorded ¥6.5 billion in equity method profit from the sale of real estate by a subsidiary of a relatedcompany (not included in the non-consolidated revenue of Kiraboshi Bank)→ Used to invest in promoting DX for the Tokyo Kiraboshi FG and other areas to contribute to more
efficient business operations● Diff. b/w
consolidated andnon-consolidated(¥100 million)

Kiraboshi Bank (non-consolidated) net income
Groupʼs consolidated net income

184

Figure below: ¥11.6 bn – ¥12.5
bn = negative ¥0.9 bn

(524)

(514)

+10

(514)

(499)

Elimination of internal transactions between consolidated Group
companies

8

Net core business income

167

272

+104

242

245

Book value adjustment of bonds owned at the time of businessintegration, etc.

9Credit-related costs

(84)

(63)

+20

(63)

(86)

Adjustment for special factors

10

Gains (losses) on bonds

14

(1)

(16)

(1)

3

11

Gains (losses) on stocks andother securities

43

44

+0

2

9

12

Other non-recurring profit(loss)

(54)

8

+62

8

(10)

13

Ordinary profit

88

260

+171

187

161

14

Income taxes

(38)

(73)

(34)

(60)

(49)

15

Net income

48

184

+136

125

111

*1 Including ¥3.0 billion in special dividends from subsidiaries (2 credit guarantee companies)
Not recorded in the consolidated revenue of Tokyo Kiraboshi FG*2 Including ¥4.2 billion (¥2.9 billion after tax) in profit on the transfer of Kiraboshi Tech, Inc. shares from
Kiraboshi Bank to FG¥3.0 bn*1 + ¥2.9 bn*2 = ¥5.9 bn
Not recorded in the consolidated revenue of Tokyo Kiraboshi FG+2[¥1.7 billion of negative effects such as start-up deficit of newly
established Group companies]

Expenses

*2

plan

249

7

*2

[Ref]
2022/3(11)

Figure below: negative ¥3.0 bn+ ¥2.9 bn - ¥6.5 bn = positive¥0.6 bn+6

Tokyo Kiraboshi FG (consolidated) net income

181● Net income record for Kiraboshi Bank/FG only, excluding special factors

184(¥100 million)

Tokyo Kiraboshi FG

Kiraboshi Bank
*1

181

*3

*2
(30)

125
(29)

(after deducting¥4.2 billion in tax)

+ ¥7.7 bn YoY(Excluding special factors)

116
(65)

+ ¥7.5 bn YoY(Excluding special factors)

6

Factors Affecting Net Income (Kiraboshi Bank)Tokyo Kiraboshi FG● Factors Affecting Net Income① Interest on loans* [Breakdown of expenses]: An increase of ¥3.4 billion year-on-year, largely due to promotion of transactions for mainbank relationship building and business financing activities and COVID-19-related loans(Loan balance up ¥431.7 bn YoY, loan yield up 0.024% YoY)(¥100 million)② Interest and dividends on ︓ An increase of ¥2.5 billion year-on-year to ¥15.1 billion, largely due to special dividends (¥3.0
securities
billion) from subsidiaries (2 credit guarantee companies)③ Other interest income: An increase of ¥0.8 billion year-on-year, largely due to interest on Bank of Japan deposits,
including those subject to the Complementary Deposit Facility, etc.

④ Non-interest income: An increase of ¥2.5 billion year-on-year due to solid accumulation of commission income (+¥2.4 billion) from corporate customers such as in business financing (+ ¥1.7 billion)⑤ Expenses (*)

︓ A decrease of ¥1.0 billion year-on-year attributable largely to a reduction in expenses due tothe improvement of management efficiency⑥ Credit-related costs

︓ ・ Additional provision of ¥0.8 billion associated with COVID-19
・ Additional provision of ¥0.6 billion associated with the Russia–Ukraine situation
・ A decrease of ¥2.0 billion year-on-year, largely due to stricter credit control, despite theprovision of additional reserve for possible loan losses (balance of preventative reserves of¥2.0 billion at the end of the period)⑦ Other non-recurring
profit (loss)

︓ An increase of ¥6.2 billion year-on-year as a result primarily of decreases in merger andsystems integration costs (-¥1.7 billion) and retirement benefit expenses (-¥1.4 billion)

Decrease

Increase④①

Interest on
loans
2021/3
Net income

②

524
44

514
44

217

229

237

⑤

261

250

232

2020/32021/32022/3⑦

Personnel
expenses(¥100 million)⑥③
Other interest
incomeTaxes

Nonpersonnel
expenses

Total

(34)
Expenses

Interest on
securities

522
44

Credit-related
costs

Noninterest
income(15)
Gains (losses) on
bonds, stocks, andother securities

Other nonrecurring
profit (loss)

Income taxes* Including ¥4.2 billion (¥2.9 billion after tax) in profit on thetransfer of Kiraboshi Tech, Inc. shares

Net income up ¥13.6 billion(Up ¥7.7 billion excluding
special factors)

2022/3
Net income

7Profit from Customer Business (Kiraboshi Bank)● Profit from customer business● Loan balance and yield(¥100 million)

Profit from customer business expanded significantly as a result
notably of increases in interest on loans and discounts as wellas commission income from corporate customers, and adecrease in expenses.

205

126

Compared with
2021/3(¥100 million, %)

1.26
1.24
Loan yield

234

1.19

1.21
1.19

1.23
1.20

(27)
2019/314

2020/32021/31.16
2022/32023/3(planned)

1.17

2024/3(planned)

1.17
Closingbalance

Loan-deposit yield
difference①

Loan balance②loan and deposit rate margin

③

④

⑤

Averagebalance(¥100 million, %)2021/32022/3

Planned43,697+4,317

1.17

1.20

+0.03

Income from fees and commissions

88

115

+26

General and administrative expenses(expenses + temporary treatment of
retirement benefit expenses, etc.)

535

511

(24)

Profit from customer business（①×②＋③－④）

14

44,344

42,46941,16739,08236,96336,381

2019/3(Averagebalance,actual)+112

Another ¥64.7
billion toachieve FY2023
target40,444

Change39,380126

Exceeded
FY2022 targets
one year aheadof schedule

43,697* Calculation method: (loan balance  loan and deposit rate margin) + income fromfees and commissions - general and administrative expenses● Breakdown of factors in profit from customer
business

1.25

1.18

+¥11.2 billion
9Tokyo Kiraboshi FG

2020/3(Averagebalance,actual)2021/3(Averagebalance,actual)2022/3(Averagebalance,actual)2023/3(Averagebalance,planned)2024/3(Averagebalance,planned)* Average balance, planned – Medium-Term Business Plan

8

Plan for the Fiscal Year Ending March 31, 2023
Kiraboshi Bank (nonconsolidated)(Unit: ¥100 million)

2022/3
resultsA

2023/3plan
B

Excluding special factors

Excluding special factors
Difference(B-A)

2022/3
results

2023/3plan

Difference(B-A)

Tokyo Kiraboshi FG(consolidated)(Unit: ¥100 million)

Gross core business profit

786

849

+63

756

784

+28

Ordinary profit

2

Net interest income

656

715

+59

626

650

+24

Profit attributable toowners of parent

3

Of which, interest on
loans and discounts

498

553

+55

498

553

+55

4

Of which, interest on
securities

187

+36

121

122

+1

5

Including other interest
income

6

(25)

(31)

6

(25)

(31)

129

133

+4

129

133

+4

(514)

(485)

+29

(514)

(485)

+29

6

Non-interest income

7

Expenses

8

Net core business income

9

Credit-related costs

151

272
(63)

*3

364
(60)

+92
+3

242
(63)

299
(60)

2022/3
results
A
*4

1

*1

Tokyo Kiraboshi FG

*4

249
181

2023/3
plan
B
*5
*5

10

● Diff. b/w
consolidated
and nonconsolidated(¥100 million)

Gains (losses) on stocks and *2

11 other securities
12

Other non-recurring profit(loss)

13 Ordinary profit

+11

(1)

10

+11

44

10

(34)

2

10

+8

8

(8)

(16)

8

(8)

(16)

260

315

+55

187

250

+63

+29

184

243

+59

195

+14

116

160

+44

Kiraboshi Bank (non-consolidated) net income
Groupʼs consolidated net income

(73)

(76)

(3)

(60)

(76)

(16)

15 Net income

184

237

+53

125

172

+47

*1 Including ¥3.0 billion in special dividends from subsidiaries (2 credit guarantee companies)(Not recorded in the consolidated revenue of Tokyo Kiraboshi FG)*2 Including ¥4.2 billion in profit on the transfer of Kiraboshi Tech, Inc. shares from Kiraboshi Bank to FG(Not recorded in the consolidated revenue of Tokyo Kiraboshi FG)*3 Expect to receive profit from the sale of real estate by a subsidiary of a related company as dividends (+ ¥6.5
billion) (Already recorded as equity method profit in the FG consolidated results for FY2021)

237

Figure below: ¥16.0 bn - ¥17.2
bn = negative ¥1.2 bn(7)[¥2.2 billion of negative effects such as
start-up deficit of newly established Group companies]

Elimination of internal transactions between consolidated Group
companies

Figure below: negative ¥6.5 bn - ¥3.5 bn= negative ¥3.0 bn

Tokyo Kiraboshi FG (consolidated) net income(5)

Kiraboshi Bank
*3
172
(65)

+ ¥4.7 bn YoY(Excluding special factors)

Tokyo Kiraboshi FG
195

(30)
195

● Net income record for Kiraboshi Bank/FG only, excluding special factors

237

14 Income taxes

Difference(B-A)

Book value adjustment of bonds owned at the time of businessintegration, etc.

+3102023/3plan
B*4 Recorded ¥6.5 billion in equity method profit from the sale of real estate by a subsidiary of a relatedcompany (not included in the non-consolidated revenue of Kiraboshi Bank)*5 Forecast to record the same level of equity method profit as in FY2021 (+ ¥3.5 billion) (notincluded in the non-consolidated revenue of Kiraboshi Bank)→ Used to invest in promoting DX for the Tokyo Kiraboshi FG and other areas to contribute to theimprovement of management efficiency

+57

(1)

2022/3
resultsA

278

Adjustment for special factors
Gains (losses) on bonds

Difference
(B-A)

(¥100
million)

*5
160
(35)

+ ¥4.4 bn YoY(Excluding special factors)

9

<Plan for the Fiscal Year Ending March 31, 2023>
Factors Affecting Net Income (Kiraboshi Bank)Tokyo Kiraboshi FG● Factors Affecting Net Income① Interest on loans:

An increase of ¥5.5 billion year-on-year is forecast, largely due to promotion of transactions for main bank relationship building andbusiness financing activities② Interest and dividends on
securities:

An increase of ¥3.6 billion year-on-year is forecast, due to factors such as the absence of special dividends from subsidiaries (2 credit
guarantee companies) recorded in the previous fiscal year (a decrease of ¥3.0 billion) and the receipt of dividends corresponding to the¥6.5 billion of equity method profit recorded by Tokyo Kiraboshi FG in the previous fiscal year

③ Other interest income:

A decrease of ¥3.1 billion year-on-year is forecast, largely due to an increase in foreign currency funding costs and a decrease ininterest on deposits with the Bank of Japan④ Non-interest income:

An increase of ¥0.4 billion year-on-year is forecast, due to solid accumulation of commission income from corporate customers such as
in business financing⑤ Expenses

︓

A decrease of ¥2.9 billion year-on-year is forecast, attributable largely to a reduction in expenses due to the improvement ofmanagement efficiency⑥ Credit-related costs

︓

A decrease of ¥0.3 billion year-on-year is forecast, due primarily to the continuing enhancement of credit management system⑦ Gains (losses) on bonds,
stocks, and other securities

︓

A decrease of ¥2.3 billion year-on-year is forecast, due mainly to the absence of profit on the transfer of Kiraboshi Tech, Inc. shares
recorded in the previous fiscal year (a decrease of ¥4.2 billion)
Increase

Interest on
securities
Interest on
loans

②

(31)
Other interest
income③Noninterest
income④

Decrease

Expenses⑤

Creditrelated
costs

⑥

(23)
Gains (losses) on
bonds, stocks, andother securities(19)
Others⑦①
Net income up ¥5.3 billion
2022/3
Net income(¥100 million)

Total(Up ¥4.7 billion excluding special factors)
2023/3
Net income

10Shareholder Returns (Dividend Policy)

Tokyo Kiraboshi FG●Implement shareholder returns based on the Medium-Term Business Plan dividend policy (a total shareholder return ratioof 20%–30%)
Medium-Term
Term Business Plan period (April 2021 toMarch 2024))

Annualdividend per
share

¥105
¥60

Net income¥4.9 billion

¥60

¥60

¥75
Net income¥18.１ billion

Net income¥19.5 billion
Excludingspecial factors¥１6.0 billion

Excludingspecial factors¥11.6 billion

Net income¥7.6 billion
Net income¥4.1 billion

Total
dividends¥1.8 billion

Total
dividends¥1.8 billion

Total
dividends¥1.8 billion

Total
Total
dividends
dividends¥2.2 billion ¥2.2 billion

Total
Total
dividends
dividends¥3.2 billion ¥3.2 billion

2019/32020/32021/32022/32023/3(planned)

39%

25%

47%

Total
shareholder
return ratio

13%

20%

16%

20%

* Total shareholder return ratio on profit from main line business excluding special factors of ¥11.6 billion
Profit from special factors of ¥6.5 billion used to invest in promoting DX and other areas to contribute to theimprovement of management efficiency (same for FY2022)11

<Reference>
Summary of Business Results for the
Fiscal Year Ended March 31, 2022

12

Loans and Trust Assets (Kiraboshi Bank)Tokyo Kiraboshi FG

Increase in loan balance (up ¥431.7 billion YoY) associated primarily with SME financing resulting frompromotion of transactions for main bank relationship building and business financing activities (P.23)
Loan balance by type of customer(¥100 million)

43,697
1,033
5,782

39,38037,698

1,174
4,577

1,423
4,692

7,300

6,999

2020/32021/32022/310.9

7.9

2022/3(%)

13.1
Services(¥100 million)

37,698450
5,608

39,380464
5,623

31,63933,292

2020/32021/32022/3

17.4
Real estateleasing

12.4
Banks and otherfinancial
institutions

Real estate
brokerageTokyo(¥100 million)

822
283

Commerce

10.5

Kanagawa

Individuals

Construction

6.2

526
5,800

37,371

Balance of trust assets

5.2

43,697

OthersManufacturing

Others16.0

Medium andlarge-sizedcompanies(%)

Composition of loan balance

Individuals

Local
governments

SMEs

7,689

Loan balance by region+4,31729,881

26,32723,892

[Ref]
YoY

445

414

294

170

151
2020/3244
2021/3Public works costreceivables trusts,
etc.
Real estate
management trust539

2022/313

Deposits and Assets under Management(Kiraboshi Bank) + UI Bank + KLD Securities

Tokyo Kiraboshi FG

Increase in deposit balance (+ ¥190.0 bn YoY) due primarily to the launch of UI Bank (+ ¥136.2 bn)
Robust accumulation of assets in securities subsidiary contributing to overall balance of assets undermanagement
Deposit balance by client

46,603
2,065
14,695[Ref]
YoY(¥100 million)

50,03351,934+1,9001,362 (UI Bank)

1,884
17,547

Balance of assets under management

1,393
18,776276
UI Bank

2,441

Others29,841

2020/330,60130,402

Corporate
Individuals

2021/32022/346,603762
9,928

50,572

[Ref]
YoY

832
10,788+539(¥100 million)

5,856

5,266

325

342

2,338

2,318

1,908

1,461
1,731

1,079
2021/32022/338,59938,951

79.0%

80.4%

2021/32022/3

Insurance

KLD (*)

Investment trusts +KLD¥319.2 billion(+¥58.6 bn YoY)

Loan-todeposit ratio

22.7%

19.0%

19.7%
Security-Tokyo

2020/3Public bonds

Loan-to-deposit ratio / security-deposit ratio

80.4%

Kanagawa+589* Kiraboshi Life Design Securities Co., Ltd.

Others35,911[Ref]
YoY

Investment trusts

1,525

2020/3

Deposit balance by region (Kiraboshi Bank non-consolidated)

50,033827
10,6064,626(¥100 million)

deposit ratio

2020/32021/32022/314

Securities (Kiraboshi Bank)Tokyo Kiraboshi FG

Aim to construct an optimal portfolio and reinforce and stabilize annual profits through the diversification of operations
from a medium- and long-term perspective
Adopt a cautious stance on investment in Japanese and foreign bonds, based on the interest rate environment
Securities balance

9,491(¥100 million)

Breakdown of available-for-sale securities

[Ref]
YoY

10,204

10,055

(148)

2,443
270
3,700
539

3,901

3,979

419

419

3,155

2,765
627

2,537

653
2,074

2,264

2020/32021/32022/3

Valuation gain/loss on “available-for-sale securities”

216
138
47

71

Bonds
Others54(11)
2020/3

97
(6)
(19)

2021/3

2,157

684

827

437
253

679

585

2020/32021/32022/3

1,516

Municipal bonds
Government(¥100 million)

PE funds, etc.
Foreign

2,273

235

Corporate bonds+78

Yield on securities

securities
REITs
Investment
trusts1.5%
Excluding special
dividends fromsubsidiaries

(145)

Stock

102

2,443

408

[Ref]
YoY

[Ref] YoY

62

100

Stock

bonds

3,979

3,901
263

Other securities(¥100 million)

2022/3

Breakdown of“other”(¥1.9 billion)
Foreign securities(¥8.4 billion)
REITs¥6.7 billion
Investment trusts(¥0.3 billion)
Others¥0.1 billion

1.20%

1.3%

1.3%

2020/32021/32022/3

Japanese
4.1 years
bonds
Foreign
0.9 yearsbonds

6.1 years

6.7 years

Duration

2020/3

3.9 years

2021/34.0 years

2022/315

Problem Assets Subject to Disclosure under the Financial
Reconstruction Law and Credit-Related Costs (Kiraboshi Bank)Tokyo Kiraboshi FG

Recorded a decrease of ¥2.0 billion YoY in credit-related costs resulting partly from enhancement of the credit management
system, despite the additional preventative provision of reserve for possible loan losses (¥1.4 bn) in view of COVID-19 andthe Russia–Ukraine situation
Value of problem assets subject to disclosure[After partial direct write-offs]

1,194

[Ref]
YoY

(¥100 million)

2020/3+192
Substandard
loans

743
60

Doubtful assets

1,051

875

Bankrupt andquasi-bankrupt

631

2021/3
114

84

1,002
68

(¥100 million)

Credit-related costs

assets2022/384

Change63(20)

Coverage status of problem assets subject to disclosure under the
Financial Reconstruction Law[Before partial direct write-offs](¥100 million)

2021/3Covered amount2022/3844

1,053

Reserve for possible loan
losses245

236

Collaterals, guarantees, etc.

599

817

51

57

58

Problem assets

1,139

1,334

2020/32021/32022/3Coverage ratio

74.1%

78.9%

Ratio of problem assets subject to disclosure[After partial direct write-offs]

1.9%
2020/32.5%
2021/32.7%2022/3[Value of problem assets subject to disclosure]
Corporate bankruptcies were kept under control, partly due to COVID-19 emergency
lending and flexible payment rescheduling, but the value of problem assets subject todisclosure increased, mainly as a result of the implementation of support lending to local
customers with 100% coverage based on business feasibility evaluations. Coverage ratio
increased YoY.
[Credit-related costs]● Additional provision of ¥0.8 billion associated with COVID-19 (restaurants and hotels)● Additional provision of ¥0.6 billion associated with the Russia–Ukraine situation(marine product wholesalers, used automobile exporters, etc.)
Credit-related costs decreased by ¥2.0 billion YoY to ¥6.3 billion, resulting partly fromenhancement of credit management system, despite the additional preventative provisionof reserve for possible loan losses mentioned above.
Note: Balance of preventative reserve as of March 31, 2022: ¥2.0 billion (including
the additional ¥1.4 billion provided)

16

Capital Ratio/Core OHR/ROETokyo Kiraboshi FG

Capital ratio declined by 0.3 point YoY due to increase in risk assets resulting from increase in loans
Core OHR and ROE improved significantly YoY, reflecting the progress of measures to strengthen income
Consolidated capital ratio (Tokyo Kiraboshi FG)

8.7%

8.7%

8.4%

32,94435,55032,614(¥100 million)

[Ref]
YoY

ROE (Tokyo Kiraboshi FG consolidated)
2020/3+2,9362021/3

2.6 %

1.3%

* ROE (consolidated) =

2,990

2,852

Risk-weighted

5.7 %Profit attributable to owners of parent(Net assets at the beginning of the period +

+137

2,852

2022/32023/3(planned)
5.9%
× 100

net assets at the end of the period) ÷ 2

Annual dividend per share (Tokyo Kiraboshi FG)

assetsCapital2020/32021/3

Total
shareholder
return ratio

76%

25%
65%

2020/3* Core OHR

2021/3＝× 100
Net income (FY2021, excluding equity method profit of ¥6.5 billion)

2022/3

Core OHR (Kiraboshi Bank)

77%

Total dividends paid + total value of share repurchases

Expenses

20%

20%

57%

2022/3Gross core business profit

47%

Used for growth investment for the
future・DX promotion
・Improvement of management
efficiency

× 100

2023/3(planned)

60 yen60 yen2020/32021/375 yen2022/3105 yen2023/3(forecast)17

Progress on the Medium-TermBusiness Plan

18

Overview of the Tokyo Kiraboshi Financial GroupTokyo Kiraboshi FG(as of March 31, 2022)①(as of March 31, 2022)(Group companies)

Location ofhead office

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

Capital¥43.7 billion

Total assets¥6,361.4 billion

Company name②③

Kiraboshi Credit Guarantee Co., Ltd.

(Group companies)

Location ofhead office

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

Capital¥27.5 billion

Consolidated
total assets¥6,443.8 billion

Company name⑦

UI Bank Co., Ltd.

Banking business⑧

Tokyo Kiraboshi Lease, Inc.

General leasing business⑨

Kiraboshi System, Inc.

System processing
outsourcing⑩

Kiraboshi Consulting Co., Ltd.

Consulting⑪

Kiraboshi JCB Co., Ltd.

Credit card business⑫

Kiraboshi Tech, Inc.

Fintech services⑬

Kiraboshi Capital Co., Ltd.

Structuring andadministration of funds⑭

Kiraboshi Life Design Securities Co., Ltd.

Securities business⑮

Kiraboshi business office service, Inc.

Payroll operations, etc.

Business description
Guarantee operations

Yachiyo Credit Guarantee Co., Ltd.

Guarantee operations④

Kiraboshi Business Service Co., Ltd.

Centralized administrative
services⑤

Kiraboshi Business Consulting Shanghai Co.,
Ltd.

Consulting⑥

KIRABOSHI BUSINESSCONSULTING VIETNAM CO., Ltd.

Consulting(Equity-method affiliate)

Business
description⑯

Kiraboshi Insurance Agency CO., LTD.

Insurance agency business(Equity-method affiliate)⑰

StarBridge business consulting (Beijing)
Co.,Ltd.

Consulting⑱

Sky Ocean Asset Management Co., Ltd.

Commissioned investment
trust services

19

Management Base of Kiraboshi GroupTokyo Kiraboshi FG● Accelerate the promotion of transactions for main bank relationship building and business financing activities
against the backdrop of a productive market

Japan
Population(estimate)

125.38 million(as of December 1,
2021)

Tokyo
13.99 million(as of December 1,
2021)

Kiraboshi Bank Branch Network(Proportion: approx.

Saitama

11%)

Chiba
Gross domestic product(nominal)
Tokyo gross municipal
product (nominal)

Number of companies(Companies + individuals)¥535.5 trillion(FY2020)

3,608 thousandcompanies(2016)¥107.0 trillion(Proportion: approx.

418 thousandcompanies(Proportion: approx.

913 thousandcompanies(Proportion: approx.

(FY2018)

Tokyo

19%)

Branch network

11%)(2016)

Number of offices

6,398 thousandcompanies(2019)

Balance of bank loans(Japanese banks)

Balance of bankdeposits (Japanesebanks)¥548.3 trillion(As of March 31, 2022)

Tokyo
Kanagawa
Saitama
Chiba
Total

Kanagawa

14%)(2019)¥238.2 trillion(As of March 31, 2022)

124
37
3
1
165

165 branches,
117 offices(Proportion: approx.

43%)
Number of Kiraboshi Bank customers with main bank transaction
relationship¥924.0 trillion(As of March 31, 2022)¥328.3 trillion(As of March 31, 2022)(Proportion: approx.

Number of companies(denominator)

35%)(Remarks)
Ministry of Internal Affairs and Communications population estimates,
Tokyo Metropolitan Government population (estimates) of Tokyo,
Cabinet Office Annual Report on National Accounts for 2020,
Tokyo Metropolitan Government Tokyo Statistical Yearbook (fiscal 2018),
Ministry of Internal Affairs and Communications 2019 Economic Census for Business Frame, 2016 Economic
Census for Business Activity,
Bank of Japan Statistics: Deposits and Loans Market

Number of customers withmain bank relationship

Share

Tokyo

229,629

7,086

3.1%

Kanagawa

77,442

2,829

3.7%

Total

307,071

9,915

3.2%

(Reference) Prepared based on a 2021 survey by TOKYO SHOKO RESEARCH, LTD.
(The number of companies is based on the TOKYO SHOKO RESEARCH, LTD. database)20

Financial Targets under the Medium-Term Business
Plan (KGIs)

Tokyo Kiraboshi FG● Achieved the targets for 5 out of 6 KGIs for FY2021② Core OHR <Kiraboshi Bank non-consolidated>(%)① ROE <FG consolidated> (%)

5.7

5.9

5.9

77.0

75.7

Expenses(¥100 million)

2.6

YoY

1.3

＋4.4pt

3.2

522

524

Planned514

Planned

181

YoY

67.0

65.3

③ Net income <FG consolidated> (¥100 million)+336.9%
57.1

195

200

Planned

57.3

100

76
41

485
467

2020/32021/32022/32023/32024/3(planned) (planned)④ Profit from customer business <Kiraboshi Bank
non-consolidated> (¥100 million)
YoY+¥11.2billion205

2020/32021/3⑤ Contribution of subsidiaries to consolidated
income <FG consolidated> (¥100 million)

2021/32022/32021/31

4(４) Planned

2024/3(planned) (planned)

2023/32024/3(planned) (planned)⑥ Capital ratio <FG consolidated> (%)

Planned8.6

112023/32022/323

3

2020/32020/3

Launch of Kiraboshi Tech and UIBank impacted FY2021 results

126
124

14

2023/32024/3(planned) (planned)

234

Planned92022/32020/32021/32022/32023/32024/3(planned) (planned)

8.6

2020/38.7

8.4

2021/32022/38.3

8.3

2023/32024/3(planned) (planned)

21Strategy of the Medium-Term Business Plan and Related
Indicators (KPIs) – Initiatives to Address ESG/SDGs

Tokyo Kiraboshi FG

Branch reorganization and improvement of operational efficiency to free up management resources and improve customer convenience, human resources development and self-fulfillment
Specific action items
Strategy (1)Branch strategy

Strategy (2)Business process reengineering

Strategy (3)Human resources
development

Function-specific branches andtransformation of all branches tonext-generation branch setup

・ Strengthen face-to-face in-person proposal and consulting
services・ Move to paperless, passbook-less, and cashless

Efficiency improvement in branchsales operation and headquarters

・ Free up personnel for allocation to high-quality
face-to-face services

Human resources development andpersonnel system reform・ Realization of diverse work styles
・ Develop human resources, create happiness for all
officers and employees

Focus items and SDG targets
Community
engagement

Shared value

Next generation /Women

Related indicators (FY2023 targets)

Related indicators (FY2021 results)

Retail-focused branches:

Retail-focused branches
34 offices

56 offices

Achievement
level

〇

Gross core business profit perhead¥32 million

Gross core business profit per

Make use of external talents

Mid-career hires: 50ー

KGIs (Please refer to P.4)

KGIs (Please refer to P.4)

ー

Number of Internet users
400,000 users

Number of Internet users:
150,000 users△

Increase in the number of business ownercustomers with assets under management:◎

head: ¥29.6 million

Increase in mid-career hires〇

Personnel allocation and enhancement of financial and competitive strengths for providing high-value-added services and contributing to the sustainable growth of society
Strategy (4)Resource allocation

DX

Centralization of routine andstrategic support functions
Establishment of Digital Bank
Improvement of customer
convenience・ Implement optimal allocation of personnel freed up throughefficiency improvement
・ Provide added value by offering back office and strategic
supportCommunity
engagement

Shared value

Accountability /Transparency

・ Fusion of “face-to-face and non-face-to-face,” “financial andnon-financial” services
・ Provide IT support for older adults, contribute to improving IT
literacy activities

Provision of high-value-added services by enhancing financial strength and with invested management resources, contribution to the sustainable growth of society
Strategy (5)Services for thebusiness ownersegment and older
adult segment

Strategy (6)Promote main bankrelationship building

Strategy (7)Medicalinstitutions

Enhancement ofcorporate
governance

Life plan support / asset management
Business targeted at the older
adult segment
Transactions with business owners,
inheritance, property management

Business succession
Business financing
Support for overseas expansion,business improvement, business start-up

Collaboration in administrative policy
measuresResponses to novel coronavirus
Local medical activities

Establishment of chief sustainability
officer position
Revision of credit policy
Established an environmentally andsocially friendly investment and loans policy

・ Provide services aligned to life stage/plan through goal-based
approach・ Kiraboshi Package – services that match to all life scenes

Community
engagement

Shared value

・ Provide combined services encompassing corporate
management, business succession (inheritance), asset
management and overseas strategy
・ Build main bank relationship through business feasibility
evaluation, take action against climate change risks

Environmental
protection

Increase in the number of business ownercustomers with assets under management:
1,000
Increase in the outstanding balance ofassets under management of businessowner customers: ¥50.0 billion

Increase in the outstanding balance of assets
under management of business owner

In the ¥0.3–10 bn annual sales zone:

In the ¥0.3–10 bn annual sales zone:
Number of loan customers with main bank

Number of loan customers with main bankrelationship: +600 customers
Financing to customers with main bankrelationship: +¥600 bn
Kiraboshi Package: 60,000 customers

・ Use funds to provide management support and financing to
medical institutions, social welfare corporations, etc.
・ Engage in regional revitalization activities at various
locations, in collaboration with administrative organs, etc.

・ Enhance Group governance to respond to diverse customer
needs

Business succession support: over 1,000
customers
Support to medical institutions: over 400
institutions

Accountability /Transparency

1,780

customers: ¥17.9 billion

relationship: +723 customers
Financing to customers with main bankrelationship: +¥154.2 bn

Kiraboshi Package: 27,000 customers
Business succession support:

388 customers

Support to medical institutions:

210 institutions

〇

◎
△
〇
〇
〇

Achievement level of each indicator<◎...Surpassed; 〇...Achieved or nearly achieved;△...More work needed>

22

Corporate Customer Strategy ① (Loans)

Tokyo Kiraboshi FG● The balance of loans has increased, attributable largely to the promotion of transactions for main bank relationshipbuilding and business financing activities
Average loan balance (¥100 mn) and yield (%)

1.19

1.21

1.18

YoY
¥208.5 billion(+5.3%)

Actual[Closingbalance]

39,082

1.24

1.26

2.19

44,344

1.52

Planned

42,4692,821

Planned2021/3(averagebalance,actual)2022/3(averagebalance,actual)2023/3(averagebalance,planned)2024/3(averagebalance,planned)Interest on loans and discounts (¥100 mn)

463

498

2020/3

1,2112021/32022/3530

2022/32024/3(planned)

562
Planned2021/32023/3(planned)

Interest on loans and discounts (business financing) (¥100 mn)

38

2020/3

4,011

2,613

697

441

1.91
5,318

1.84

36,9632020/3(averagebalance,actual)

1.87

1.77

43,697

41,167

Business loan balance (¥100 mn) / Yield (%)

2023/3(planned)

2024/3(planned)

1012

2020/32021/3402022/3622023/3(planned)892024/3(planned)23

Corporate Customer Strategy ② (Commission Income)Tokyo Kiraboshi FG● Commission income from corporate customers has increased, largely due to stronger promotion of businessfinancing
Commission income from corporate customers <businessfinancing> (¥100 mn)

Commission income from corporate customers (¥100 mn)

YoY¥2.4 billion

58

56

33

55
Planned

32

29

29

2023/3(planned)

2024/3(Planned)

22

33

16
10

2020/32021/32022/32023/3(planned)

2024/3(planned)

Number of Kiraboshi Bank customers with main bank transaction
relationship (companies)

12,385
10,991

11,446

11,655
Of which, creditof ¥100 million
and above

2,757

2,663

3,548

3,738

2019/32020/32021/32022/32020/32021/32022/3

SF Division● 14 employees● Provides expert-structured financeand other financial support forcorporate customers

MF Division● 47 employees● Support sales offices, making useof strategies such as mezzanine
finance to build main bankrelationships

RF Division● 9 employees● Newly established in April 2022
● Real Estate Finance Division● Established independently fromthe SF Division, to undertake
business such as nonrecourse realestate loans
Headquarters sales staff
responsible for sophisticatedprojects

24

Corporate Customer Strategy ③(Equity and Mezzanine Finance)

Tokyo Kiraboshi FG● Enhance high-value-added offerings such as equity and mezzanine finance for customers in various life stages● FY2021: Kiraboshi Capital Co., Ltd. saw a significant increase in the value of funds arranged and invested

Kiraboshi Capital Co., Ltd.
Changes in fund amounts (¥100 mn)

The value of arranged
funds has grown by afactor of 10 since thecompany was establishedin September 2018

Funds administered by Kiraboshi Capital

251

+80

136

Arranged(left)

36

30
1

7

2019/32020/3

Yume Kagayaki Fund 1

331

Yume Yorisoi Fund 1
Tokyo Sparkle
A&KC Medical No. 1

+101

35
2021/3

Invested(right)Yume Habataki Fund 1 (*)

2022/3KCP Equity Assist No. 1

Buyout investment
Growth capital investment
Mezzanine financeEngagement investing
Medical Fund
Equity investment (minority)(*) Completed exit from QD Laser, Inc., the fundʼs first investment project, through its
successful IPO (TSE Mothers Index) in February 2021.

Kiraboshi Capital Co., Ltd.

Yume Kagayaki Fund 1

50%
15%

Shareholding
ratio● Established in September 2018
● 30 employees● Established as a wholly owned subsidiary of the Tokyo Kiraboshi Financial
Group with the aim of expanding the range of support by providing
financial services through funds.
● Manages funds matching each life stage, from foundation through growthand maturity to restructuring
Provides solutions to meet the management needs of customers,
including listed companies and entrepreneurs gathered in the Tokyo
metropolitan area

Launched in
Nov. 2018
Launched inMar. 2019
Launched inAug. 2020
Launched in
Nov. 2020
Launched inMar. 2021
Launched inJun. 2021

KCP Equity Assist No. 1
Yume Yorisoi Fund 1

Yume Habataki Fund
1
Start-up
phase

Growthphase

A&KC Medical No. 1
Maturityphase

Mainly SMEs

Declinephase

Tokyo Sparkle

Others
Mainly listedcompanies, etc.

25

Corporate Customer Strategy ④(Medical Institutions and Trust Business)

Tokyo Kiraboshi FG● Collaborate with administrative organs, etc. to actively support medical institutions, which face a challenging business environment due to COVID-19● Provide services utilizing the trust function to respond to diverse customer needs, achieving the second-highest level of trust balance among regionalbanks
Balance of loans to medical institutions aimed at building mainbank relationship (¥100 mn) / Yield (%)

1.57

1.57

YoY

¥+31.0billion

1.31

Changes in balance of major trust products (¥100 mn)

1.39

1.40

Real estate management
trust“Con-trust”

539

405
268

285

268

244

176

95

254
141

151
68

30
2020/32021/32022/32023/3(planned)

2024/3(planned)● Utilize schemes such as the Tokyo Metropolitan Governmentʼs financing
scheme for medical institutions to support the cash flow and finances of
medical institutions, which face a challenging business environment due
to COVID-19, and grow the balance of loans.

Medical and Welfare Business Division● Established in October 2002
● 13 employees● Leverages the expertise acquired
during its 19-year history as apioneering specialized medical
division to provide diverse financial
support2022/3 Total balanceApprox. ¥120 bn(Including loans aimed atbuilding main bankrelationship)

2021/3
Approx. ¥100 bn(Including loans aimed atbuilding main bankrelationship)

2019/32020/32021/32022/3

2019/32020/32021/32022/3

Regional banks trust asset balance (¥100 mn) (as of September
2021)
Source: Trust Companies Associationof Japan
2nd among
regionalbanks
777

 Real estate management trust
 Public works cost receivables trust(“Con-trust”)
 Longevity support trust(“Mamoriboshi”)
 Collected money administration
trust (“pre-need funeral trust”),
etc.

573

208

Bank A Kiraboshi Bank Bank B

150

106

Bank CBank D●Expand product line-up and achieve solid growth of outstanding balance26Retail Customer Strategy ①(Assets Under Management)

Tokyo Kiraboshi FG● Engage in activities with a committed customer-oriented approach in the retail customer business, and respond diligently to inquiries by SME
owners● Effectively waive sales commissions for customers with a balance of assets under management of ¥10 million or more, and engage in sales
activities focused on outstanding balanceFees and commissions from financial instruments(¥100 million)

36

Balance of assets under management (¥100 million)
Kiraboshi Bank

Kiraboshi Bank
2020/4〜
Shift to no-loadfeatures20

2020/32021/3

Planned 21
202022/323

Note: Including stocks, bonds, etc. for KLD Securities
Established KLD Securities

KLD Securities

27

4,920

5,266

4,626

5,856
4,124

4,186

2023/3 plan

2019/32024/3 plan

Transactions with business owners

2020/3

1,079

1,731

2021/32022/3<KLD Securities only> Balance of investment trusts +fund wraps (¥100 million)
1,641

April 2021 to March 2022
Number of business owner customers withassets under management:＋1,780 accounts
Increase in outstanding balance＋¥17.93 bn

1,040
Of which,fund wraps

213
24

178

2020/92021/3556

2022/3● Build a business model focused on outstanding balance andnot dependent on sales commission
Fees and commissions(Mainly trust fees)¥200 mn(2021/3)¥800 mn(2022/3)27

Retail Customer Strategy ②(Life Plan Support Business)

Tokyo Kiraboshi FG● Launched 100-year passport in September 2021, responding to customer demand to “prepare” for the risks presented by the aging
society● Launched online applications for retail IB in January 2022. The number of retail IB users aged 60 and above has risen significantly

100-year passports

Number of retail IB users aged 60 and above
Launched online applications inJan. 2022

Kiraboshi Jinsei Yorisoi Trust<100-year passport>① Pension benefits receiving
function② Security and assurancefunction③ Payment service function④ Thoughtful succession function

With 4 trust functions and a diverse range of services in
one package, the 100-year passport is a trust productthat “prepares” for an aging society, guarding against
future dementia and health concerns by enablingcustomers to “use,” “protect,” and “connect” theirimportant assets.

Service launched in Sept. 2021
Number of cases:

52

425 million (as of March 31, 2022)¥

17,40011,80011,7002021/32021/92022/3

Testamentary trust and arrangement
operation● Continuing to respond to customersʼ property
succession needs
Testamentary trust(number of contracts)
FY2019184

FY202086

FY2021

109

Inheritance arrangement
operation (number ofcontracts)
FY201929

FY202020

FY202119

28

Improvement of Management Efficiency ① (Expenses)

Tokyo Kiraboshi FG● Aim for productivity improvements through greater personnel efficiency and the optimal allocation ofmanagement resources
Expenses (¥100 million)

Integration effects and merger costs (¥100 million)
Total 10

546
40

233

271

2019/3

522
44
217

261

2020/3

Taxes

Nonpersonnel
expenses
Personnel
expenses

25

63

106
Other efficiency

524

514

8

improvement

44

44

21

measures

229

8
237
7
10

250

2021/3232

2022/3

5
10
7
22
(34)

20

32

25

18

17

Systems integration

Reconstruction of
branch network

43

61
Improvement of
headquarters

(42)

(26)

(9)

efficiency
Merger and systems
integration costs● FY2021 saw a decrease of ¥1.0 billion year-on-year due tolower personnel expenses, largely from the commissioning ofservices from Group companies to Kiraboshi business officeservice, Inc., despite an increase in non-personnel expenses.

2019/32020/32021/32022/3● Merger costs have decreased substantially from FY2021
onwards.
● Integration effects will expand further.

29

Improvement of Management Efficiency ②(Branch Strategy)

Tokyo Kiraboshi FG● For the improvement of management efficiency, the restructuring of branch functions is progressing according
to plan, based on branch operations with less staff<Planned number of sales offices>

Reduction in the number of offices

Number of sales offices

STEP 1
FY2020

STEP 2To FY2023

STEP 32020/32021/32022/32023/3planned2024/3planned

Offices for corporate
and retail customers

104

89

46

46

46

Retail-focused branches

14

20

56

44

34

Offices specializing in
corporate customers

3

2

4

6

8

Sub-total (1)

121

111

106

96

88

Staffed sub-branches
and offices (2)

13

12

10

20

28

Total of (1) + (2)

134

123

116

116

116

[Of which, offices for corporate
and retail customers]

134 offices[104 offices](18 offices)[(58 offices)]

116 offices[46 offices]Achieve further
efficiency
improvements while
maintaining thenumber of contact
pointsKey points of branch strategy

Note: Excluding online branches● FY2021: Completed 7 BIB offices● Effects of branch elimination/consolidation tomaterialize further from FY2022

 Revision into offices specialized to meet the individual needs of each region
 Transform all manned sales offices into next-generation branches (branches with self-service
electronic counters) Boost customer convenience by integrating sales offices and digital services

30

Improvement of Management Efficiency ③(Employee Numbers)

Tokyo Kiraboshi FG● Aim to improve productivity per employee through greater personnel efficiency and the optimal allocation ofmanagement resources<Planned number of employees>[FY2019→FY2023 efficiency improvements]
FY20191,849

FY2023
1,644

269

Sales
sections
Branch sales
sections

Trend in productivity (per office, per employee)(¥100 million)

350 150

567
Sales offices

Branchmanagers, etc.

Amount of loans per office and per employee

1,144

1,013

(¥100 million)

Headquarters
Others(Including seconded
employees, etc.)

1,039

882

Amount of loans per employee (right-handaxis; denominator: total number of
employees in Kiraboshi Bank)

2,767

350

17

16
14

2,656

(¥100 million)

20
17

450

Headcount
2,888

Amount of loans per office (left-hand axis;
denominator: number of offices in Sub-total (1) on
the previous page)

510

13
412

2,526

15

455

358
311
250

2020/32021/32022/32024/3(planned)

10
2020/32021/32022/32023/32024/3

ActualActualActualPlannedPlanned31

Capital Policy

Tokyo Kiraboshi FG● Engage in a well-balanced capital management to ensure soundness and efficiency of capital and maintain appropriate
return of profits to shareholders
FY2023 targets
Accumulation of equity capital

Capital ratio

Secure financial strength to be able to make lump sum repayment ofpreferred shares

Enhance quality of capitalin the 8% range

Maintain financial soundness while accumulating internal reserves andrisk assets

Improve profit level by strengthening financing functions through risk taking

Capital ratio  ROE (profit/risk-weighted assets)
Strategic investment

ROE

Improve Group income based on RAF

Improve capital efficiency

Approx. 6%

Improve profit level using assets from risk taking activities

Shareholder return in line with profit and net asset levels

Appropriate return ofprofits to shareholders

Total shareholder
return ratio
20%–30%

Increase return rate that can respond to shareholder expectations

Changes in management indicators (%)● Maintain balance between capital ratio
and ROE, and secure appropriate return
commensurate with risks taken● Examine appropriate return of profitsand dividend level by taking into
consideration future profit level and total
shareholder return ratio

Dividend in principle Share buybacks where necessary

8.6

RORA 0.5%

8.7

8.4

Capital ratio

5.7

ROE

2.6
1.3
0.2

0.1

0.4

RORA
2020/32021/32022/332

The Kiraboshi Groupʼs Actions for the
Future33

Digital Strategy of Kiraboshi GroupTokyo Kiraboshi FG● Expand digital strategy for the purposes of both “offense” and “defense,” to accelerate the Groupʼs digital shift
and DX
Digital sales<Offense><Offense>

Established UI Bank (Digital Bank) <January 2022>
・ Maximize income opportunities for the Group through the mutual
introduction of customers with Kiraboshi Bank

Launched the digital wallet “LaLaQ” app <November 2021>
・ Customer burden-free Pay Charge function: expand the number ofcompanies with Maekyu
・ Further boost convenience through coordination with Digital BankDX through Digital Bank
➡ From “low-cost deposits acquisition” to “finance ×
non-finance services”

Data preparation and analysis<Defense>

Form a data analysis team and develop data analysts
・ Develop data analysts through the practical analysis of business andoperational issues
・ Build a team of around 10 analysts in 2023

Build infrastructure and databases to support the use of data
・ Enhance data for analysis and build databases for data usage

Use data to transform management and sales➡ Achieve Group operations with a greater focus onefficiency

Digital businesses and personnel<Offense>

Digital/DX consulting × business matching・ Create a structure to integrate and respond to customersʼ digital needs
・ At least 20 business matching partner companies in the digital field

Launch a digital personnel development program・ Develop personnel who can respond to customersʼ digital needs
・ Boost recruitment of digital personnel, and transform corporate
cultureCreate internal schemes to respond to customer needs➡ Further grow the scale of digital business

Digital infrastructure<Defense>

Renew infrastructure and devices to support more efficientbusiness operations
・ Introduce new infrastructure and devices at all offices to support
more efficient business operations

Introduce groupware to transform work styles
・ Install Microsoft Office 365 at all offices
・ Transform work styles and communication to achieve more efficientbusiness operations

Leverage digital technology to transform work
styles➡ Achieve greater productivity from each
employee

34

Digital Bank (UI Bank)Tokyo Kiraboshi FG● UI Bank forms the centerpiece of the digital-based platform concept. It performs the role of a hub, facilitating the mutual use ofservices across the Group, the acquisition of new customers, and coordination with partner companies● Accelerate the digital shift, and begin to transform the retail business
Coordinate with Kiraboshi Bank branches to build a structure to respond to the diverse needs of customers through both the digitaland real channels[Kiraboshi Bank → UI Bank]...Shift simple deposit and foreign exchange transactions at branches tonon-face-to-face (digital) transactions, which have merits in terms of interest as well as fees andcommissions[UI Bank → Kiraboshi Bank]...Shift high-quality services such as consulting to face-to-face services

Reciprocal
customertransfer● Enable the speedy, low-cost use of services by building a new system infrastructure● In FY2022, plan to commence retail loans and coordination with Group companies (securities coordination, LaLaPay Charge) andfurther expand the range of services

Sales base in the Tokyo
metropolitan area
Kiraboshi Bank/
Group customers

Utilize branch network,
personnel, service
contact points

Deposits / foreignexchange services

Non-faceto-face
Reciprocal
customertransfer

New markets
UI Bank

New customers
Promotions
focused on social
media and online

Face-to-faceConsulting services

35

<Reference> UI Bank Results

Tokyo Kiraboshi FG

Number of UI Bank accounts: 23,547 ordinary savings accounts, 44,099 term deposit accounts (as of March 31, 2022)
Approximately half of these are new customers. While mostly in their 40s and 50s, deposits from customers in the 30s or below arealso increasing, as are deposits from outside the Tokyo metropolitan area

Balance of deposits and number of accounts

Breakdown of deposit
balance
Ordinary

Targets¥91.5 billion (as of March 31, 2022)

savings
6.0%¥136.2 billion

ActualOrdinary savings accounts:
Term deposit accounts:¥8.2 billion <23,547 accounts>¥127.9 billion <44,099 accounts>

Kiraboshi Bank customers:
New customers:¥68.7 billion (50.4%)¥67.5 billion (49.5%)

Distribution of accounts
by age group

80 and
above
1.1%

70s:
6.3%

19 and below:
0.2%

20s:
6.3%

30s:
13.9%

60s:
20.8%
40s:
20.7%
50s:
30.3％

30s and below:
20.4%

Enabling an approachto the younger
demographic withwhich the existing
Kiraboshi Bank has
little contact

Term deposits
93.9%

Distribution of accounts
by region

Kyushu &Okinawa
2.6%

Hokkaido &Tohoku2.7%

Chugoku &Shikoku
2.1%
Kansai
6.8%

Hokuriku &Koshinetsu
2.2％

Tokai
4.1%

Tokyo
45.3%

Tokyo &
Kanagawa:
63.8%
Other regions:36.2%

Enabling abroader approach(expanded
geographicalarea oftransactions)

Kanto
15.3%

Kanagawa
18.5%

36

Kiraboshi Tech, Inc. (Maekyu/LaLaPay)

Tokyo Kiraboshi FG● “LaLaQ” enables the integrated use of the digital wallet LaLaPay and the internal loans system “Maekyu”● Aim to achieve the “DX of Daily Use,” including the seamless transition from charging through settlement, as well as
the integration of an industry-first function enabling payment to other settlement businesses

Overview of LaLaQ
services
Rechargebalance bydepositing cash
at an ATM

Usage
scenarios• Send money to otherusers through the app• Code-based payment
available at convenience
stores and restaurants
across Japan(Smart Code by JCB)
• Payments on e-commercesites through JCBʼs virtual
prepaid card function(under development:
installation planned in
FY2022)

Recharge LaLaPaybalance from Maekyu

Internal loans with
0% interest
Funds transferred
directly to usersʼ
accounts• Money transfers to othercompaniesʼ payment
services• ATM cash withdrawals

Business development being pursued〇 Pursue a competitive advantage through the LaLaQ
service and the new advance payment product(nickname: Smart Salary) to expand our share of thesalary prepayment market (aim for the top share of themarket)〇 Leverage the LaLaQ service to enter the full-time
employee market〇 Provide new finance schemes utilizing attendance dataand personnel evaluation data (utilization of AI, etc.)

Awarded a prize in the
Collaboration Category of theJapan Financial Innovation Award
Use the LaLaQ platform to enter other domains aswell as finance, such as data and HR (humanresources)
LaLaQ was awarded a prize in the Collaboration
Category of the Japan Financial Innovation Award.
LaLaQ was recognized for its swift introduction ofservices, its unique business model, and its future
potential to transform the lifestyles of working
people.

37

Digital-based, Tokyo-based Platform Concept ①

Tokyo Kiraboshi FG● In the first year of the Medium-Term Business Plan, launched the Tokyo-based platform concept through the establishment of UI Bank and therelease of LaLaPay● Built a coordinated platform for supporting start-ups in the Haneda area through co-creation with Kawasaki Heavy Industries and others● We are also considering building a platform for foreign workers in Japan and platforms in collaboration with companies providing various
services

Project B

Illustration of Tokyo-based Platform
Haneda Airportand surrounding
facilities

Project A

Overseas funds
transfer service
providersStart-ups

Co-creation platform in Haneda
Innovation City

Platform for foreigners
in JapanLarge
corporations
Foreigners inJapanForeign workers
and students

Collaboration
Administrative
organsKiraboshi Consulting Co., Ltd.

Lifestyle support,
entertainment, art

Cocreation

Medicalinstitutions

Future concept
SportsAdministrative
organs38

Digital-based, Tokyo-based Platform Concept ②Tokyo Kiraboshi FG

Project A

HANEDA Platform[Support for start-ups]● Opened KicSpace HANEDA, a Tokyo Municipal Government-certified incubation facility in Haneda Innovation City (in November 2021)(In addition to the real community at KicSpace HANEDA, we are also considering establishing an online community platform)● Collaboration between KicSpace HANEDA and Future Lab HANEDA, a facility for robot field testing opened by Kawasaki Heavy Industries (in April
2022)● Holding seminars and matching events to link start-ups, together with Kawasaki Heavy Industries● Arranged and invested in a CVC fund to promote the fusion of start-ups and large corporations (invested in eight companies)[Digital shift / cashless shift]● Considering cashless proof-of-concept testing based in KicSpace HANEDA, Haneda Innovation City

Project B

Future concept

Platform for foreign workers and students in Japan● Aim to solve social issues such as
Japanʼs declining workforce● Aim to provide services and information
to foreign workers and students inJapan, from their arrival in Japan, toaccommodation, employment, lifestyle,and finance (opening a bank account,remitting money overseas, etc.)● Considering the establishment of acounter at Haneda Airport to provide
services to foreigners arriving in Japan● Considering BaaS collaboration and theprovision of services with overseas funds
transfer and relocation service providers① Arrivein JapanOpen bankaccount⑤ Remitmoney
Send money
home

Clothing &medical④Lifestyle② Place tolive
Housing

Finding &changing jobs

● Considering the construction of several digitalbased platforms● Aim to coordinate the functions of UI Bank and
LaLaPay with those of service providers, toconstruct platforms that link services, users, andcompany employees with the functions of UIBank and LaLaPay<Examples of service providers>・ Lifestyle support companies
・ Entertainment and sports companies
・ Subscription service providers
・ Local medical communities, etc.

③
Employment

39

Further Promotion of Partnership with
External Organizations
Tokyo Metropolitan Government and relatedorganizations
Comprehensive collaborationagreement relating to industrial
development in Tokyo
Tokyo Metropolitan Government
General management support
Tokyo Metropolitan Small and Medium
Enterprise Support Center

Local public bodies, related organizations, etc.

Kanagawa Institute ofIndustrial Science andTechnology
Yokohama Industrial
Development Corporation
Kawasaki City

Support in employment andsecuring human resourcesTokyo Kiraboshi FG
Tokyo Kanagawa Solution Connect

×

The Bank of Yokohama, Ltd.

LBOs and other collaboration in the structured finance field,
etc.

Targets

First-year impact ofcollaboration¥10 billion over 5 years¥2.3 billion(sum of the two banks)

Tokyo Foundation for Employment
Services

Sagamihara City
Inagi City

Technical support
Tokyo Metropolitan Industrial
Technology Research InstituteSupport for work style reform,
securing human resources

Collaboration between industry andacademia

Tokyo Metropolitan University

Tokyo Labor Bureau
Comprehensive collaborationagreement on support for SMEs
The Tokyo Chamber of Commerce andIndustry

Nihon University College of Art
Chuo University
Aoyama Gakuin University

Partner financial institutions, etc.
Sumitomo Mitsui TrustBank

Mitsui Sumitomo Insurance

Senshu Ikeda Holdings
Senshu Ikeda BankSky Ocean Asset Management

Jimoto Holdings
Kirayaka Bank
Sendai Bank

Bank of Yokohama

Collaboration with private sector
corporations

FY2021

FY2022

FY2023

FY2024FY2025+ sharing of back office work
Cost reductions of ¥16 million per year
Partial introduction of joint delivery of cash, documents,
etc.
(between sales offices in the West Tokyo area)
Joint industry–academia course at the Chuo University Faculty ofCommerce (donated course)● Held the joint industry–academia course“Venture Business Project” (donated by
Kiraboshi Bank) as part of our initiatives
in the education field under our Basic
Agreement on Comprehensive
Collaboration
Conclusion of “Basic Agreement on Comprehensive Collaboration” with
Aoyama Gakuin University● Signed an agreement for exchanging andutilizing personnel and intellectual resources
through industry–academia collaboration inareas such as education and research for the
purpose of contributing to the development ofsociety40

Sustainability Initiatives

Tokyo Kiraboshi FG● The Group we will work together to solve local community issues based on the Sustainability Policy establishedin December 2021
The Groupʼs initiatives
2019.52021.22021.12

Measures to support customers
2022.1

Environmentally and sociallyfriendly investment and loans
policy“Sustainability Policy”“Environmental Policy”
Support for TCFD
recommendations“We will actively support businesses
that engage in resolving
environmental and social issues by
providing loans, and endeavor, as
far as possible, to mitigate andavoid the impact of specific sectorsthat have a negative effect on theenvironment and society.”“Tokyo Kiraboshi Financial Group SDG Declaration”
formulated

Environment-related
investments and loans target for
2030¥200.0 billion(2022 to 2030)<Reference> FY2021 result:approx. ¥14 billion (JPY equivalent)

The Group has produced theeducational pamphlet “FIRST BOOK of
Decarbonization” to explain the needfor decarbonization to SME managers inan accessible format, and encourage
their “awareness” of the issue. The
pamphlet will support customers toresolve their sustainability issues.

The Group has prepared a support

package including one-stop access to arange of support measures related to the
SDGs and decarbonization provided byGroup companies. The package isprovided according to customersʼ issues
and current outlook.

Example ofsupport items(Kiraboshi Consulting Co., Ltd.)

Kiraboshi SDGs Evaluation Program
Evaluation and feedback on customersʼ engagementwith the SDGs, to respond to customer needs toascertain their own level of SDGs engagement andcommence engagement from a basic level, etc.

41Figures in this document are calculated in units of a million yen, but are presented inunits of 100 million yen. The total amount therefore may not match the total for each
item.



Please note that some of the figures in this document are taken from preliminary reports.

This document contains forward-looking statements on the Groupʼs results. Thesestatements are not intended to guarantee future results, as they are subject to risks andcontain uncertainties. Please keep in mind that future results may differ due to factors
including changes in the business environment.

■ Please direct any comments or questions about
Tokyo Kiraboshi Financial Group, Inc.
these briefing materials or other IR topics to the IR Corporate Communication Division
office at the right.
TEL:+81-3-6447-5799
MAIL: ir@kiraboshibank.co.jp

42