Consolidated Financial Summary (Japanese GAAP)
for the Fiscal Year Ended March 31, 2018
May 14, 2018
Sony Financial Holdings Inc.
(URL: https://www.sonyfh.co.jp/web/index_en.html)
Stock exchange listing: Tokyo Stock Exchange (code number: 8729)
Representative:
Shigeru Ishii, President and Representative Director
Inquiries:
Yasuo Hasegawa, General Manager-Investor Relations Dept.
(Telephone: +81-3-5290-6500)(Fractional amounts of less than ¥1 million are discarded.)Company name:

1. Consolidated financial results for the fiscal year ended March 31, 2018
(1) Operating results
Ordinary Revenues
Millions of yen% change

Millions of yen% change

Millions of yen% change

1,503,630

8.8

66,8430.8

51,89524.7

1,381,667

1.4

66,326(6.7)

41,621(4.0)

For the year ended
March 31, 2018
For the year ended
March 31, 2017
Note: Comprehensive Income:

Profit Attributable to Owners of
the Parent

Ordinary Profit

For the year ended March 31, 2018:¥52,207 million:

143.6%For the year ended March 31, 2017:¥

21,433 million:(69.9)%Net Income on
Shareholders’EquityNet Income per
Share

Net Income per
Share(Fully Diluted)

Yen

Yen

%

%

%

119.30119.29

8.5

0.6

4.4

95.69

95.68

6.9

0.6

4.8

For the year ended
March 31, 2018
For the year ended
March 31, 2017
Notes: Equity in earnings (losses) of affiliates:

For the year ended March 31, 2018:¥(2,338) million

For the year ended March 31, 2017:¥(3,551) million

Ordinary Profit on Ordinary Profit on
Total Assets
Ordinary Revenues(2) Financial conditions
Total Assets
As of March 31, 2018
As of March 31, 2017
Note: Net Assets Attributable to Shareholders:

Total Net Assets

Net Asset Ratio

Net Assets per Share

Millions of yen

Millions of yen%

Yen

12,401,446
11,471,845

625,406
601,1395.0
5.2

1,433.73
1,378.63

Cash Flows from
Financing Activities

Cash and Cash
Equivalents at end of
the period

As of March 31, 2018:¥ 623,661 million

As of March 31, 2017:¥ 599,630 million(3) Cash flows
Cash Flows fromOperating Activities
For the year ended
March 31, 2018
For the year ended
March 31, 2017

Cash Flows from
Investing Activities

Millions of yen

Millions of yen

Millions of yen

Millions of yen

819,721(680,845)(14,496)

393,133

692,445(624,749)(34,057)

268,381

2. Dividends
Dividend per Share

Record date

For the year ended
March 31, 2017
For the year ended
March 31, 2018
For the year ending
March 31, 2019
(forecast)

AnnualDividend
AmountDividend
Payout
Ratio

Dividend on
Net Assets

1st quarter2nd quarter3rd quarter

Year-end

Annual Total

Yen

Yen

Yen

Yen

Yen

Millions of
yen

%

%

－

0.00

－

55.00

55.00

23,922

57.5

4.0

－

0.00

－

60.00

60.00

26,099

50.3

4.3

－

0.00

－

62.50

62.50

49.4

3. Forecast of consolidated financial results for the fiscal year ending March 31, 2019
(Percentage figures represent changes from the results of the previous fiscal year.)
Profit Attributable to
Net Income per
Ordinary Revenues
Ordinary Profit
Owners of the Parent
Share
For the year ending
March 31, 2019

Millions of yen% change

Millions of yen% change

Millions of yen% changeYen

1,578,000

4.9

83,00024.2

55,000

6.0

126.44

4. Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying changes in scope of
consolidation): None
(2) Changes in accounting policies, accounting estimates and restatements of the Consolidated Financial Statements(a) Changes in accounting policies resulting from the revision of the accounting standards and other regulations: None(b) Changes in accounting policies due to other reasons: None(c) Changes in accounting estimates: None(d) Restatements of the Consolidated Financial Statements: None
(3) Number of shares outstanding (common stock)(a) Number of shares outstanding (including treasury shares)
As of March 31, 2018:
435,027,513 shares
As of March 31, 2017:
435,000,000 shares(b) Number of treasury shares
As of March 31, 2018:35,775 shares
As of March 31, 2017:
52,975 shares(c) Weighted-average number of shares
For the year ended March 31, 2018:434,979,667 shares
For the year ended March 31, 2017:434,978,040 shares
Audit of Financial Statements
This earnings report is exempt from audit procedure of certified public accountants or audit firm.

Content of Supplemental Materials
I. Qualitative Information and Financial Statements
1. Qualitative Information on Consolidated Operating Performance ………………………………………

2

2. Qualitative Information on Consolidated Financial Position ……………………………………………

5

II. Status of the Corporate Group ………………………………………………………………
III. Basic Views on Selection of Accounting Standards………………………………………
IV. Consolidated Financial Statements

6

1. Consolidated Balance Sheets ……………………………………………………………………………

7

6

2. Consolidated Statements of Income and Consolidated Statements of Comprehensive Income(Consolidated Statements of Income) ……………………………………………………………………

9(Consolidated Statements of Comprehensive Income) …………………………………………………

12

3. Consolidated Statements of Changes in Net Assets………………………………………………………

13

4. Consolidated Statements of Cash Flows…………………………………………………………………

16

5. Notes to the Consolidated Financial Statements
1) Note on Going Concern ………………………………………………………………………………

182) Segment Information …………………………………………………………………………………

183) Subsequent Events…………………………………………………………………………………

21

V. Attachment
Consolidated Financial Results for the Fiscal Year Ended March 31, 2018 and Sony Life’s Preliminary
MCEV as of March 31, 2018……………………………………………………………………………

23* The conference call for explaining the Sony Financial Group financial results will be held at 16:00 (Tokyo), May
14, 2018. Please note that our conference call will be held only in Japanese.
We will upload the presentation materials with speech text on May 14, 2018 after 15:00 (Tokyo), the translationof the conference call (audio) on May 15 and the Q&A summary (text) at a later date on the Earnings Releases
and Presentation Materials page of our website:
https://www.sonyfh.co.jp/en/financial_info/results/index.html* We will upload the press releases on Sony Life’s Market Consistent Embedded Value as of March 31, 2018,
scheduled as below.
・ Full report: Scheduled to be uploaded on May 21, 2018 at 15:00 (Tokyo)
Please see further details at our website: https://www.sonyfh.co.jp/index_en.html* On May 14, 2018, Sony Financial Holdings Inc.’s (SFH’s) significant subsidiaries―Sony Life Insurance Co.,
Ltd. (Sony Life), Sony Assurance Inc. (Sony Assurance) and Sony Bank Inc. (Sony Bank)―will announce theirfinancial results for the year ended March 31, 2018. SFH prepared an English-language summary of thoseJapanese announcements made by the above subsidiaries, solely for convenience of non-Japanese readers.

- 1 -I. Qualitative Information and Financial Statements
1. Qualitative Information on Consolidated Operating Performance
1) Analysis of Operating Performance
During the year ended March 31, 2018 (from April 1, 2017 to March 31, 2018), the Japanese economy continued to recover.
Global demand for IT products drove external demand, while a stable recovery in the employment situation fueled internal
demand. The current economic recovery, which began in December 2012, has now surpassed the Izanagi economic boom
(1965–1970) to become Japan’s second-largest post-war period of economic growth. However, early 2018 was marked by a
growing sense of uncertainty regarding the overseas political and economic situation, and financial markets werecharacterized by instability, with the yen appreciating and stock prices falling. The Bank of Japan’s (BOJ’s) quarterly Shortterm Economic Survey of Principal Enterprise in Japan (Tankan survey) in March reported worsening business sentiment for
the first time in eight quarters, indicating that optimism about the Japanese economy was waning to some degree.
In bond markets, yields on 10-year Japanese government bonds (JGBs) ranged between negative 0.02% and positive
0.09%. Between April and the first half of September, such factors as political uncertainty surrounding the French presidential
election and geopolitical risk in the Middle East and North Korea pushed down JGB yields. On the other hand, from Octoberdebates on tax reform in the United States prompted a rise in US government bond yields, which rippled outward to affectJGB yields. Furthermore, with crude oil prices beginning to trend upward Japan’s core consumer price index increased bynearly 1%, spurring expectations among market participants that the BOJ would lift the 10-year interest rate target defined in
its “quantitative and qualitative monetary easing with long- and short-term interest rate controls.” However, as this situation
prompted yen appreciation the BOJ engaged in fixed-rate buying operations to curtail the rise in JGB yields, thereby
indicating its stance toward continuing current levels of monetary easing.
In foreign exchange markets, the yen traded near ¥112 to the US dollar from April 2017 to early January 2018. The yen
dipped to ¥110 at several points during this period, owing to such factors as the French presidential elections, Russiagate
allegations and geopolitical risk surrounding North Korea. Meanwhile, from October debates on tax reform in the UnitedStates prompted expectations of a rise in interest rates, causing the yen to depreciate to around ¥114 against the US dollar.
Since mid-January 2018, mounting expectations of monetary policy normalization in Japan and bearish sentiment stemmingfrom the jump in US government bond yields have prompted a decline in global stock markets, and caution regarding theprotectionist trade policies of the Trump presidency have led to sudden yen appreciation, rising to around ¥104 against the US
dollar at one point in late March.
Amid these circumstances, the Sony Financial Group sought to become the financial services group most highly trusted bycustomers. To this end, we undertook a variety of measures to maintain a sound financial base, reinforce and expand our
product and service offerings in order to deliver high-value-added products and high-quality services to each of ourcustomers, and enhance our internal control system.
Consolidated ordinary revenues increased 8.8% year on year, to ¥1,503.6 billion, owing to increases in ordinary revenues
from all the businesses: life insurance, non-life insurance and banking businesses. Consolidated ordinary profit increased
0.8% year on year, to ¥66.8 billion. By business segment, ordinary profit from the life insurance business decreased, ordinary
profit from the non-life insurance and banking businesses rose. Profit attributable to owners of the parent was up 24.7%
year on year, to ¥51.8 billion. This increase was due to a gain on disposal of fixed assets from a sale of the real estate held forinvestment of ¥13.2 billion in the life insurance business, which was recorded in extraordinary gains in this fiscal year ended
March 31, 2018.

- 2 -Operating results by business segment are as described below.
Ordinary Revenues(Billions of yen)
Year ended
March 31, 2017
(Apr. 1, 2016, to Mar. 31, 2017)

Year ended
March 31, 2018
(Apr. 1, 2017, to Mar. 31, 2018)

1,243.9

1,351.2

8.6

Non-life insurance business

102.3

110.0

7.6

Banking business

38.5

39.9

3.7

1,384.7

1,501.2

8.4

Other*1

0.2

6.0

－

Intersegment adjustments

(3.3)

(3.6)

－

1,381.6

1,503.6

8.8Life insurance business

Subtotal

Consolidated

Change (%)

Ordinary Profit(Billions of yen)
Year ended
March 31, 2017
(Apr. 1, 2016, to Mar. 31, 2017)

Year ended
March 31, 2018
(Apr. 1, 2017, to Mar. 31, 2018)

Life insurance business

56.8

54.1

(4.7)

Non-life insurance business

5.0

6.5

31.5

Banking business

5.0

7.1

41.4

66.8

67.8

1.5

Other*1

(0.7)

(1.0)

－

Intersegment adjustments*2

0.1

0.0

(69.7)

66.3

66.8

0.8

Subtotal

Consolidated

Change (%)*1: “Other” consists of nursing care business. Proud Life Inc., a company of nursing care business, has been included in the scope of consolidation from
FY17.2Q.
*2: Amounts in the “Intersegment adjustments” of the Ordinary profit are mainly from SFH and eliminations of intersegment transactions.

- 3 -2) Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2019
For the year ending March 31, 2019 (from April 1, 2018 to March 31, 2019), we expect sustainable growth to continue, withbusiness expansion ongoing in all the businesses.
We forecast increases in ordinary revenues and ordinary profit, owing mainly to the impact of the life insurance business.
Although we expect extraordinary gains to decline, we anticipate that profit attributable to owners of the parent will grow intandem with ordinary profit.
Note: The effects of market fluctuations after April 1, 2018 have not been incorporated in the forecast.
* The effects of market fluctuations after April 1, 2018 have not been incorporated within the forecast.
The forecast of consolidated financial results for the year ending March 31, 2019 below remains unchanged from the forecast
announced on April 27, 2018.
(Billions of yen)
(Reference)
Actual results for the year ended
March 31, 2018

Forecast
for the year ending
March 31, 2019

Change (%)

Ordinary revenues

1,503.6

1,578.0

4.9

Ordinary profit

66.8

83.0

24.2

51.8

55.0

6.0

119.30126.44－

Profit attributable to owners of
the parent
Net income per share (Yen)
Forecast by business segment is as follows.

<Life insurance business>
We forecast ordinary revenues to increase from the year ended March 31, 2018, owing to robust income from insurance
premiums. We also anticipate a year-on-year rise in ordinary profit, stemming from an increase in profit on higher policies inforce, a rise in gains on sale of securities, and an improvement in net gains/losses on derivative transactions to hedge market
risks for available-for-sale securities.
(Billions of yen)
(Reference)
Actual results for the year ended
March 31, 2018

Forecast
for the year ending
March 31, 2019

Change (%)

Ordinary revenues

1,351.2

1,416.1

4.8

Ordinary profit

54.1

70.9

30.9

<Non-life insurance business>
We expect ordinary revenues to increase from the year ended March 31, 2018, in line with growth in net premiums written,
primarily for automobile insurance. Despite the higher revenues, we believe ordinary profit will be flat year on year, with theloss ratio rising slightly from the year ended March 31, 2018, when the ratio was lower than we had anticipated.
(Billions of yen)
(Reference)
Actual results for the year ended
March 31, 2018

Forecast
for the year ending
March 31, 2019

Change (%)

Ordinary revenues

110.0

112.3

2.0

Ordinary profit

6.5

6.5

(1.1)

- 4 -

<Banking business>
We expect ordinary revenues to rise year on year due to stable business growth stemming from the ongoing steady
accumulation of mortgage loans and strengthening of foreign currency business. Although we anticipate a rise in grossoperating profit in line with revenue growth, we expect ordinary profit to be flat year on year, as operating expenses rise.
(Billions of yen)
(Reference)
Actual results for the year ended
March 31, 2018

Forecast
for the year ending
March 31, 2019

Change (%)

Ordinary revenues

39.9

42.8

7.2

Ordinary profit

7.1

7.0

(2.0)

2. Qualitative Information on Consolidated Financial Position
1) Assets, Liabilities and Net Assets
As of March 31, 2018, total assets amounted to ¥12,401.4 billion, up 8.1% from March 31, 2017. Among major components
of assets, securities, mostly Japanese government bonds, amounted to ¥9,581.2 billion, up 8.2% from March 31, 2017. Loanscame to ¥1,785.8 billion, up 3.8%.
Total liabilities were ¥11,776.0 billion, up 8.3% from March 31, 2017. Major components of liabilities included policy
reserves and others of ¥8,763.3 billion, up 8.0%, and deposits totaled ¥2,159.2 billion, up 4.3%.
Total net assets were ¥625.4 billion, up 4.0% from March 31, 2017. This included net unrealized gains on other securities,
net of taxes, which decreased 0.8 billion, to ¥133.9 billion.

2) Cash FlowsNet cash provided by operating activities for the year ended March 31, 2018, was ¥819.7 billion, primarily due to income
from insurance premiums in the life insurance business.The amount of net cash provided was up 127.2 billion (18.4%) year on
year, mainly because of a smaller rise in mortgage loans and other lending in the banking business.
Net cash used in investing activities was ¥680.8 billion, mainly because payments to acquire marketable securities
exceeded proceeds from sale and redemption of securities in the life insurance and banking businesses.The amount of net cashused increased ¥56.0 billion (9.0%), year on year because of a decrease in proceeds from net increase in collateral for
securities lending transactions in the life insurance business during the year under review compared with an increase in theprevious fiscal year.
Net cash used in financing activities came to ¥14.4 billion as the payments for cash dividends more than offset theproceeds from issuance of bonds. Net cash used in these activities was down ¥19.5 billion (57.4%) year on year, due toproceeds from issuance of bonds during the year ended March 31, 2018.
As a result of the above factors and others, cash and cash equivalents at March 31, 2018, were ¥393.1 billion, up ¥124.7
billion (46.5%) from March 31, 2017.

Please refer to the attached presentation materials for non-consolidated operating results of SFH’s principal subsidiaries, Sony
Life, Sony Assurance and Sony Bank for the year ended March 31, 2018.

- 5 -II. Status of the Corporate GroupThe Sony Financial Group is composed chiefly of Sony Life, Sony Assurance and Sony Bank. These companies are direct
subsidiaries of SFH, the financial holding company.
The Sony financial Group are positioned as shown in the following organizational chart.
[Organizational chart] (As of March 31, 2018)

III. Basic Views on Selection of Accounting Standards
SFH’s consolidated financial statements are prepared in accordance with accounting principles generally accepted in Japan. SFH
is considering whether to adopt International Financial Reporting Standards (“IFRS”) while closely monitoring the developmentof new accounting standards and the stance of regulatory bodies at home and abroad.

- 6 -IV. Consolidated Financial Statements
1. Consolidated Balance Sheets(Millions of yen)
As of March 31, 2017

As of March 31, 2018¥¥

AssetsCash and due from banks

206,481327,633

Call loans and bills bought

61,90065,500

Monetary claims purchased

573

5,378

296,877

291,582

Securities

8,857,436

9,581,206

Loans

1,720,004

1,785,877

123,614106,051

Land

83,007

63,106

Buildings

Money held in trust

Tangible fixed assets

34,96432,468

Leased assets

715

6,074

Construction in progress

132

5

Other tangible fixed assets

4,794

4,397

Intangible fixed assets

30,77635,684

Software30,14635,059Goodwill

49

583

Leased assets－

0

Other intangible fixed assets

579

40

Due from agencies0－

Due from reinsurers

1,438

934

Foreign exchanges

7,268

9,346

Other assets

148,650

168,736

Net defined benefit asset

2,752

3,426

Deferred tax assets

15,313

21,242

Reserve for possible loan losses(1,243)(1,152)

Total Assets

¥

- 7 -

11,471,845¥

12,401,446

(Millions of yen)
As of March 31, 2017

As of March 31, 2018¥¥

Liabilities
Policy reserves and others
Reserve for outstanding claims

8,113,153

8,763,349

71,30674,7128,036,118

8,683,153

5,729

5,484

Due to agencies

2,616

1,873

Due to reinsurers

3,737

5,563

Policy reserves
Reserve for policyholders’ dividends

Deposits

2,071,091

2,159,246

Call money and bills sold

70,00096,000Borrowed money

90,000173,944

Foreign exchanges

108

228

Bonds payable

10,00020,000

Other liabilities

427,866

470,501

Reserve for employees’ bonuses

3,694

3,906

Net defined benefit liability

31,39933,179Reserve for directors’ retirement benefits
Special reserves
Reserve for price fluctuations
Deferred tax liabilities
Deferred tax liabilities on land revaluation
Total Liabilities

366－

46,182

48,13546,182

48,135

－

0

488

109

10,870,705

11,776,039

19,90019,927

Net Assets
Common stock
Capital surplus

195,277

191,157

Retained earnings

255,062

283,911

(81)

(55)

470,157

494,941

Net unrealized gains (losses) on other securities, net of taxes

134,849

133,991

Net deferred gains (losses) on hedging instruments, net of taxes(1,154)(902)

Land revaluation, net of taxes(1,465)(2,439)Remeasurements of defined benefit plans, net of taxes(2,756)(1,929)Total accumulated other comprehensive income

Treasury Stock
Total shareholders’ equity

129,472

128,719

Subscription rights to shares

49

97

Non-controlling interests

1,460

1,648

601,139

625,406

Total Net Assets
Total Liabilities and Net Assets

¥

- 8 -

11,471,845¥

12,401,446

2. Consolidated Statements of Income and Consolidated Statements of Comprehensive Income(Consolidated Statements of Income)(Millions of yen)

Ordinary Revenues
Ordinary Revenues from the Life Insurance Business
Income from insurance premiums
Insurance premiums
Ceded reinsurance commissions
Investment income

For the year ended
March 31, 2017

For the year ended
March 31, 2018¥¥

1,381,667

1,503,630

1,240,764

1,347,762

955,252

1,057,411

952,547

1,054,867

2,704

2,544

244,839

242,703

Interest income and dividends

147,785

157,276

Income from monetary trusts, net

4,493

4,490

Gains on trading securities, net

152

2

1,308

0

－

1

14,670－5

176,42380,931

40,67247,646102,337

110,091

100,329

108,316

100,274

108,253

55

62

1,957

1,731

1,327

1,324

685

470

0

－

(55)

(62)

49

43

38,31839,712

26,534

28,344

Interest income on loans

16,065

17,064

Interest income and dividends on securities

10,394

11,204

Gains on sale of securities
Gains on redemption of securities
Foreign exchange gains, net
Other investment income
Gains on separate accounts, net
Other ordinary income
Ordinary Revenues from the Non-life Insurance Business
Underwriting income
Net premiums written
Interest and dividends on deposits of premiums
Investment income
Interest income and dividends
Gains on sale of securities
Gains on redemption of securities
Transfer to interest and dividends on deposits of premiums
Other ordinary income
Ordinary Revenues from the Banking Business
Interest income

Interest income on call loans and bills bought－

2Interest income on deposits with banks

63

63Interest income on interest rate swaps

8－

Other interest income

1

9Fees and commissions

6,673

6,751

Other operating income

4,871

3,823

4,431

3,456

439

366

Gains on foreign exchange transactions, net
OthersOther ordinary income
Other
Other ordinary income

238

794

247

6,064

247

6,064
(Continued)- 9 -(Millions of yen)

Ordinary Expenses
Ordinary Expenses from the Life Insurance Business

For the year ended
March 31, 2017

For the year ended
March 31, 2018¥¥

1,315,341

1,436,787

1,186,465

1,296,417

372,407436,538

Insurance claims

84,17892,342

Annuity payments

12,01912,566

Insurance benefits

98,252

119,294

Surrender payments

168,409199,263

Other payments

3,122

3,314

Reinsurance premiums

6,423

9,756

596,742

638,343

3,330

2,211

593,411

636,13100Investment expenses

35,93732,889Interest expenses

44

151

Losses on sale of securities－

0

Losses on redemption of securities

53

2

Insurance claims and other payments

Provision for policy reserves and others
Provision for reserve for outstanding claims
Provision for policy reserves
Interest portion of reserve for policyholders’ dividends

Losses on derivatives, net

30,05011,403Foreign exchange losses, net－

15,280

Provision for reserve for possible loan losses－

23

Depreciation of real estate for rent and others

1,779

1,680

4,008

4,346

Operating expenses

Other investment expenses

136,645

139,420

Other ordinary expenses

44,73349,226

96,639102,798

Underwriting expenses

70,09473,943Net losses paid

50,181

52,482

Loss adjustment expenses

7,458

8,067

Net commission and brokerage fees

1,187

1,295

Ordinary Expenses from the Non-life Insurance Business

Provision for reserve for outstanding losses
Provision for underwriting reserves
Investment expenses
Losses on sale of securities
Other investment expenses
Operating, general and administrative expenses
Other ordinary expenses

798

1,194

10,46910,903

3

2

0

－

3

2

26,52028,84819

4(Continued)- 10 -

(Millions of yen)

Ordinary Expenses from the Banking Business

For the year ended
March 31, 2017

For the year ended
March 31, 2018¥¥

Interest expenses

31,27430,428

8,554

7,656

5,104

5,320

Interest expenses on call money and bills sold

(17)

(73)

Interest on borrowed money

190Interest expenses on deposits

Interest expenses on bonds
Interest expenses on interest rate swaps
Other interest expenses
Fees and commissions
Other operating expenses
General and administrative expenses
Other ordinary expenses
Other
Other ordinary expenses
Ordinary Profit
Extraordinary Gains
Gains on disposal of fixed assets
Extraordinary Losses

74

40

3,372

2,360

0

8

3,648

4,676

86

105

18,843

17,733

142

257

962

7,141

962

7,141

66,326

66,843－

13,258－13,258

2,032

2,180

Losses on disposal of fixed assets

134

187

Impairment losses

118

2

1,772

1,953

1,772

1,953

7

36

Provision for Reserve for Policyholders’ Dividends

4,153

3,271

Income Before Income Taxes

60,14074,650

Income Taxes - Current

23,12929,008

Income Taxes - Deferred(4,724)(6,344)

Total Income Taxes

18,40522,664

Profit41,734

51,985

Provision for special reserves
Provision for reserve for price fluctuations
OthersProfit Attributable to Non-controlling Interests

113

Profit Attributable to Owners of the Parent¥- 11 -

41,62190¥

51,895

(Consolidated Statements of Comprehensive Income)(Millions of yen)

Profit

For the year ended
March 31, 2017

For the year ended
March 31, 2018¥¥

41,734

51,985

Other comprehensive income
Net unrealized gains (losses) on other securities, net of taxes(22,515)(857)

Net deferred gains (losses) on hedging instruments, net of taxes

1,192

251

Remeasurements of defined benefit plans, net of taxes

1,021

827

Total other comprehensive income(20,301)

Comprehensive income¥

21,433221¥

52,207(Details)
Comprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controlling interests- 12 -

21,301

52,11613191

3. Consolidated Statements of Changes in Net Assets
For the year ended March 31, 2017
(Millions of yen)
Shareholders’ Equity
Common stock

Balance at the beginning of
the period
Cumulative effects ofchanges in accounting
policies
Restated balance at the
beginning of the period

Capital surplus

Retained earnings

Treasury stock¥ 19,900¥ 195,277¥ 238,079－－

19,900¥Total shareholders’ equity(0)¥ 453,256

105

－

105

195,277

238,185(0)453,362－－(23,924)－(23,924)－－

41,621－

41,621

－

－

－

(81)

(81)

－

－

(818)

－

(818)

－

－

－

－

－

－

－

16,877(81)

16,795¥ 19,900¥ 195,277¥ 255,062(81)¥ 470,157

Changes during the period
Dividends from surplus
Profit attributable toowners of the parent
Purchase of treasury
stock
Adjustments due tochange of scope of
consolidation
Net changes of items
other than shareholders’equityTotal changes during theperiodBalance at the end of theperiod¥Total accumulated other comprehensive income
Net deferred gains
Net unrealized
Total accumulated Subscription rights Non-controlling(losses) on
Remeasurements
gains (losses) on
Land revaluation,otherto shares
interests
hedgingof defined benefit
other securities,
net of taxes
comprehensive
instruments,
plans, net of taxes
net of taxes
incomenet of taxes

Balance at the beginningof the period
Cumulative effects ofchanges in accounting
policies
Restated balance at the
beginning of the period¥ 157,364¥(2,347) ¥(1,465) ¥(3,760) ¥ 149,791

－

－

－

－

－

157,364(2,347)(1,465)(3,760)

－

－

－

－

－

－

¥

1,329

¥ 604,377

－

－

105

149,791－

1,329

604,482

－

－

－

－

(23,924)

－

－

－

－

－

41,621

－

－

－

－

－

－

(81)

－

－

－

－

－

－

－

(818)

(22,515)

1,192

－

1,003

(20,319)49

131(20,138)(22,515)

1,192

－

1,003

(20,319)49

131(3,343)(1,154) ¥(1,465) ¥1,460¥ 601,139－¥

Total net assets

Changes during the period
Dividends from surplus
Profit attributable toowners of the parent
Purchase of treasury
stock
Adjustments due tochange of scope of
consolidation
Net changes of items
other than shareholders’equityTotal changes during theperiodBalance at the end of theperiod¥ 134,849¥- 13 -(2,756) ¥ 129,472

¥

49

¥

For the year ended March 31, 2018
(Millions of yen)
Shareholders’ Equity
Common stock

Balance at the beginning of
the period

Capital surplus

Retained earnings

Treasury stock¥ 19,900¥ 195,277¥ 255,062

Issuance of new shares

27

27

Dividends from surplus－¥

Total shareholders’ equity(81)¥ 470,157

－

－

55

－

(23,922)－(23,922)－－

51,895－51,895

－

(5)

－

26

21

－

5

(5)

－

－

－

－

973

－

973

－

－

(92)

－

(92)

－

(4,147)－－(4,147)

－

－

－

－

－

27

(4,119)28,84926

24,784¥ 19,927¥ 191,157¥ 283,911(55)¥ 494,941

Changes during the period

Profit attributable toowners of the parent
Disposal of treasury
sharesTransfer of loss on
disposal of treasury
shares
Reversal of land
revaluation
Adjustments due tochange of scope of
consolidation
Change in ownershipinterest of parent due totransactions with noncontrolling interests
Net changes of items
other than shareholders’equityTotal changes during theperiodBalance at the end of theperiod¥(Continued)- 14 -

Total accumulated other comprehensive income
Net deferred gains
Net unrealized
Total accumulated Subscription rights Non-controlling(losses) on
Remeasurements
gains (losses) on
Land revaluation,otherto shares
interests
hedgingof defined benefit
other securities,
net of taxes
comprehensive
instruments,
plans, net of taxes
net of taxes
incomenet of taxes

Balance at the beginning of
the period¥ 134,849¥(1,154) ¥(1,465) ¥(2,756) ¥ 129,472

¥

49

¥

Total net assets

1,460¥ 601,139

Changes during the period
Issuance of new shares

－

－

－

－

－

－

－

55

Dividends from surplus

－

－

－

－

－

－

－

(23,922)

－

－

－

－

－

－

－

51,895

－

－

－

－

－

－

－

21

－

－

－

－

－

－

－

－

－

－

－

－

－

－

－

973

－

－

－

－

－

－

－

(92)

－

－

－

－

－

－

－

(4,147)

(857)

251

(973)

827

(752)

48

187

(516)

(857)

251

(973)

827

(752)

48

187

24,267(902) ¥

(2,439) ¥1,648¥ 625,406

Profit attributable toowners of the parent
Disposal of treasury
sharesTransfer of loss on
disposal of treasury
shares
Reversal of land
revaluation
Adjustments due tochange of scope of
consolidation
Change in ownershipinterest of parent due totransactions with noncontrolling interests
Net changes of items
other than shareholders’equityTotal changes during theperiodBalance at the end of theperiod¥ 133,991¥- 15 -(1,929) ¥ 128,719

¥

97

¥

4. Consolidated Statements of Cash Flows(Millions of yen)
For the year ended
March 31, 2017

For the year ended
March 31, 2018¥¥

Cash flows from operating activities
Income before income taxes

60,14074,650Depreciation of real estate for rent and others

1,779

1,680

Depreciation and amortization

10,944

11,828118

2

Impairment losses
Amortization of goodwill
Increase (decrease) in reserve for outstanding claims
Increase (decrease) in policy reserve
Increase in interest portion of reserve for policyholders’dividends
Increase (decrease) in reserve for policyholders’ dividends
Increase (decrease) in reserve for possible loan losses
Increase (decrease) in net defined benefit liability
Increase (decrease) in reserve for directors’ retirement benefits
Increase (decrease) in reserve for price fluctuations

22

32

4,128

3,405

603,880

647,035

0

0

4,153

3,271

(65)

(140)

3,020

2,363

14

(176)

1,772

1,953

Interest income and dividends(175,647)(186,943)(Gains) losses on securities(77,393)(80,057)

8,636

8,327

Losses (gains) on derivative

30,05011,403

Exchange (gains) losses(10,843)

23,489107(13,283)

3,551

2,338

Net (increase) decrease in loans(195,446)(56,745)

Net increase in deposits

156,005

87,98750,00080,00070,00026,000Net (increase) decrease in call loans and bills bought

311(4,805)

Net (increase) decrease in foreign exchange (assets)(6,129)(2,077)

Net increase (decrease) in foreign exchange (liabilities)

21

119

(1,710)15,506

Interest expenses

Losses (gains) on disposal of tangible fixed assets
Equity in losses of affiliates

Net increase (decrease) in borrowed money (excluding
subordinated borrowings)
Net increase (decrease) in call money and bills sold

Others541,424

657,168

Interest and dividends received

Subtotal

188,230

197,007

Interest paid

(8,730)(8,484)

Policyholders’ dividends paid

(3,430)(3,517)

Income taxes paid

(25,047)(22,451)

692,445819,721

Net cash provided by operating activities(Continued)- 16 -

(Millions of yen)
For the year ended
March 31, 2017

For the year ended
March 31, 2018

Cash flows from investing activities
Net (increase) decrease in deposits¥

Investments in monetary trusts

－

¥

5

(76)

(101)

5,160

6,532

(1,171,569)(1,104,737)

Proceeds from sale and redemption of securities

375,241

427,925

Investments in loans(57,798)(60,315)

Collections of loans

27,94928,761(35,401)(22,997)

247,803(6,719)－32,553(608,689)(699,092)

83,755

120,629(3,977)(2,049)Proceeds from sale of monetary trusts
Purchases of securities

Net gains (losses) from the settlement of derivative financial
instruments
Net increase (decrease) in collateral for securities lendingtransactions
OthersTotal of net cash used in investment transactions
Total of net cash provided by (used in) operating activities andinvestment transactions
Purchases of tangible fixed assets
Proceeds from sales of tangible fixed assets
Purchases of intangible fixed assets
Purchase of securities of a non-consolidated subsidiary
Purchase of securities of affiliates
OthersNet cash used in investing activities－

36,700(9,024)(12,481)－(339)(3,045)(3,450)

(12)

(132)

(624,749)(680,845)

－

5,266

Cash flows from financing activities
Proceeds from debt borrowing
Repayments of debt－

(5,133)

Cash dividends paid

(23,925)(23,921)

Proceeds from issuance of bonds－

19,938

Payments for redemption of bonds(10,000)(10,000)

(81)

－

－

(171)

(51)

(474)

(34,057)(14,496)

Purchase of treasury stock
Payments from changes in ownership interests in subsidiaries
that do not result in change in scope of consolidation
OthersNet cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Increase (decrease) in cash and cash equivalents resulting fromchange of scope of consolidation
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period¥- 17 -(1)(2)

33,636124,377

1,124

373

233,620

268,381

268,381¥393,133

5. Notes to the Consolidated Financial Statements
1) Note on Going Concern
Not applicable.

2) Segment Information(1) Outline of reporting segments
The Sony Financial Group’ s reporting segments are components of the Group whose operating results are regularly
reviewed by the Board of Directors to make decisions about resources to be allocated to the segments and assess theirperformance, for which discrete financial information is available.
SFH is the financial holding company of Sony Life Insurance Co., Ltd., Sony Assurance Inc., Sony Bank Inc., and Sony
Lifecare Inc., and pursues financial group strategies. The subsidiaries make their own business plans and engage inbusiness activities from which they may earn revenues and incur expenses, under the Insurance Business Law of Japan, theBanking Law of Japan, and other regulations.
The Sony Financial Group consists of three reporting segments: the life insurance business, the non-life insurance businessand the banking business.
●The life insurance business consists of Sony Life Insurance Co., Ltd., AEGON Sony Life Insurance Co., Ltd. and SA
Reinsurance Ltd.
●The non-life insurance business consists of Sony Assurance Inc.
●The banking business consists of Sony Bank Inc., Sony Payment Services Inc. and SmartLink Network Hong Kong
Limited.

- 18 -

(2) Segment Information by reporting segment
For the year ended March 31, 2017
Millions of yen
Non-life
insurancebusiness

Life insurance
business
Ordinary revenues
External customers
Intersegment
Total
Segment profit
Segment assets
OthersDepreciation
Interest income and dividends
Interest expenses
Equity in earnings (losses) ofaffiliates
Investments in affiliates
Increase in tangible fixed assets
and intangible fixed assets¥ 1,240,764
3,161
1,243,925¥
56,815
8,873,446¥¥¥

102,3370102,337
5,001
186,569

Bankingbusiness

Total¥

38,318196
38,514¥
5,053
2,438,836¥

1,381,420
3,358
1,384,778¥
66,87011,498,851

other

¥

¥

Total

247
－
247
(714)
3,544

¥ 1,381,667
3,358
1,385,026¥
66,155
11,502,396

7,178
148,300
44

3,493
1,327
－

2,618
26,533
8,672

13,290176,162
8,717

41
0
36

13,331
176,162
8,753(3,551)－－(3,551)－(3,551)

10,986－－

10,986－

10,986

9,607

¥

3,500

¥

2,451

¥

15,559¥46¥

15,606

For the year ended March 31, 2018
Millions of yen
Non-life
insurancebusiness

Life insurance
business
Ordinary revenues
External customers
Intersegment
Total
Segment profit
Segment assets
OthersDepreciation
Interest income and dividends
Interest expenses
Equity in earnings (losses) ofaffiliates
Investments in affiliates
Increase in tangible fixed assets
and intangible fixed assets¥ 1,347,762
3,462
1,351,225¥
54,1489,566,063¥¥¥

110,0911
110,092
6,574
204,395

Bankingbusiness

Total¥

39,712
221
39,934¥7,146
2,651,162¥

1,497,566
3,685
1,501,251¥
67,86912,421,622

other

¥

¥

Total

6,064
－
6,064
(1,077)
13,532¥ 1,503,630
3,685
1,507,316¥
66,792
12,435,155

7,147
157,743
151

3,927
1,324
－

2,458
28,344
7,731

13,532
187,411
7,883

616
0
516

14,148
187,4118,400(2,338)－－(2,338)－(2,338)12,245－－

12,245－

12,245

9,511

¥

2,660

¥

- 19 -

4,709¥

16,882¥930¥

17,812

(3) Reconciliations of the totals of each segment item to corresponding enterprise amounts
Millions of yen
For the year ended
March 31, 2017
Totals of reporting segments¥

For the year ended
March 31, 2018
1,384,778
247

Other

¥

1,501,251
6,064(3,358)Adjustments for intersegment transactions¥

Ordinary revenues in statement of income(3,685)

1,381,667¥

1,503,630

Millions of yen
For the year ended
March 31, 2017
Totals of reporting segments¥

For the year ended
March 31, 2018
66,870(714)

Other
Adjustments for intersegment transactions¥

67,869(1,077)9161

Amount not allocated to reporting segments¥

Ordinary profit in statement of income

(133)
185

66,326¥

66,843

Millions of yen
For the year ended
March 31, 2017
Totals of reporting segments¥

For the year ended
March 31, 2018

11,498,851¥

12,421,622

Other
Adjustments for intersegment transactions

3,544(58,287)

13,532(70,927)

Amount not allocated to reporting segments

27,736

37,218¥Assets in balance sheets

11,471,845¥

12,401,446

Millions of yen
For the year ended
March 31, 2017
Total
Depreciation

Other

For the year ended
March 31, 2018

Adjustments¥

24

Consolidated
financialstatements

Total¥ 13,290 ¥41

Interest income anddividends¥ 13,356 ¥ 13,532 ¥

176,1620(514)

175,647

187,411

Interest expenses

8,717

36

(117)

8,635

Equity in earnings(losses) of affiliates(3,551)－－

Investments in affiliates

10,986－－¥ 15,559 ¥

46

Other

Adjustments

616¥

Consolidated
financialstatements

38¥ 14,187

0(467)

186,944

7,883

516

(74)

8,325

(3,551)(2,338)－－(2,338)

10,986

12,245－－

12,24510¥ 17,822

Increase in tangible
fixed assets andintangible fixed assets¥

269¥ 15,875 ¥ 16,882 ¥- 20 -930¥

3) Subsequent Events(Establishment of a subsidiary)
May 14, 2018—The Board of Directors passed a comprehensive resolution to establish a subsidiary through a company split(simple incorporation-type company split).
1.Objective
SFH will establish an investment subsidiary to invest in venture companies with strengths in Fintech and other fields in theinterest of obtaining a financial return and promoting collaboration and cooperation between venture companies andindividual companies in the Sony Financial Group. As a result, SFH aims to enhance the Sony Financial Group’s existing
businesses and create new businesses.
2.Overview of the subsidiary
Name
Sony Financial Ventures Inc. (scheduled)
Head office
Chiyoda-ku, Tokyo (scheduled)
Business

Venture capital operations and any other operations ancillary to or related to venture capital

Common stock
Issued sharesoperations¥10 million (scheduled)
10,000 shares (scheduled)

Established
Shareholder composition

July 10, 2018 (scheduled)Sony Financial Holdings Inc. 100%

- 21 -

SFH’s consolidated results* are prepared in accordance with Japanese GAAP. As such, these figures differ in significant respects
from the financial information reported by Sony Corporation, SFH’s parent company, which prepares its financial statements inaccordance with U.S. GAAP.
* SFH’s scope of consolidation includes following companies
Consolidated subsidiaries:
Sony Financial Holdings Inc.
Sony Life Insurance Co. Ltd.
Sony Assurance Inc.
Sony Bank Inc.
Sony Payment Services Inc.
SmartLink Network Hong Kong Limited.
Sony Lifecare Inc.
Lifecare Design Inc.
Proud Life Inc.**
Affiliated companies accounted for under the equity method:
AEGON Sony Life Insurance Co., Ltd.
SA Reinsurance Ltd.
** Proud Life Inc. is included in the scope of consolidation from the second quarter ended September 30, 2017.

Statements made in this press release concerning the current plans, expectations, strategies and beliefs of the Sony Financial Group.
Any statements contained herein that are not historical facts are forward-looking statements or pro forma information. Forwardlooking statements may include-but are not limited to-words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,”“assume,” “forecast,” “predict,” “propose,” “intend” and “possibility” that describe future operating activities, businessperformance, events or conditions. Forward-looking statements, whether spoken or written, may also be included in other materials
released to the public. These forward-looking statements and pro forma information are based on assumptions, decisions andjudgments made by the management of Sony Financial Group companies, and are based on information that is currently available tothem. As such, they are subject to various risks and uncertainties, and actual business results may vary substantially from theforecasts expressed or implied in forward-looking statements. Consequently, investors are cautioned not to place undue reliance on
forward-looking statements. Sony Financial Group companies are under no obligation to revise forward-looking statements or pro
forma information in light of new information, future events or other findings. The information contained in this press release does notconstitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe to any
securities, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever inJapan or abroad.

- 22 -

V. Attachment
Content of Presentation Material
Consolidated Financial Results for the Fiscal Year Ended March 31, 2018 andSony Life’s MCEV as of March 31, 2018
・ Consolidated Operating Results for the Fiscal Year Ended March 31, 2018 (FY2017) ……………………

3

・ Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2019 (FY2018) ………

29

・ Dividend Forecast for FY2018………………………………………………………………………………

31

・ Sony Life’s Preliminary MCEV and ESR as of March 31, 2018……………………………………………

33

・ Appendix ……………………………………………………………………………………………………

36- 23 -

Attachment

Presentation Material

Consolidated Financial Results
for the Fiscal Year Ended March 31, 2018
andSony Lifeʼs Preliminary MCEV
as of March 31, 2018

Sony Financial Holdings Inc.
May 14, 2018
Sony Financial Holdings Inc. All Rights Reserved

Content
 Consolidated Operating Results for the Fiscal Year Ended March 31, 2018
(FY2017)

P.3

 Forecast of Consolidated Financial Results for FY2018

P.29

 Dividend Forecast for FY2018

P.31

 Sony Lifeʼs Preliminary MCEV and ESR as of March 31, 2018

P.33

 Appendix

P.36

Disclaimers:
This presentation material contains statements concerning the current plans, expectations, strategies and beliefs of the SonyFinancial Group. Any statements contained herein that are not historical facts are forward-looking statements or pro forma
information. Forward-looking statements may include̶but are not limited to̶words such as “believe,” “anticipate,” “plan,”“strategy,” “expect,” “assume,” “forecast,” “predict,” “propose,” “intend” and “possibility” that describe future operating activities,business performance, events or conditions. Forward-looking statements, whether spoken or written, may also be included in othermaterials released to the public. These forward-looking statements and pro forma information are based on assumptions, decisions
and judgments made by the management of Sony Financial Group companies, and are based on information that is currently
available to them. As such, they are subject to various risks and uncertainties, and actual business results may vary substantiallyfrom the forecasts expressed or implied in forward-looking statements. Consequently, investors are cautioned not to place undue
reliance on forward-looking statements. Sony Financial Group companies are under no obligation to revise forward-looking
statements or pro forma information in light of new information, future events or other findings. The information contained in thispresentation does not constitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or
subscribe to any securities, nor shall it or any part of it form the basis of or be relied on in connection with any contract orcommitment whatsoever in Japan or abroad.
*Unless otherwise indicated, in these materials figures less than the indicated unit have been truncated, while ratios and percentage changes have been rounded.
Also, a “–” is used where percentage changes exceed 1,000% and in cases where one or both comparisons are negative.
* “Lifeplanner” is a registered trademark of Sony Life.

Sony Financial Holdings Inc. All Rights Reserved2

Attachment

Consolidated Operating Results
for the Fiscal Year Ended March 31, 2018
(FY2017)

Sony Financial Holdings Inc. All Rights Reserved

3

Executive SummaryFinancial
Results for
FY2017
Forecast of
Financial
Results for
FY2018











Shareholder
Returns

All three businesses steadily expanded their business scale.
On a consolidated Group basis, ordinary revenues rose, while ordinary
profit was flat.
At Sony Life, sales of U.S. dollar-denominated insurance were favorable,
leading to a substantial increase in income from insurance premiums
year on year
The steady acquisition of new policies prompted solid growth in new
business value.
We forecast that all three businesses will continue to expand theirbusiness scale, sustaining the growth trend. On a consolidated Groupbasis, we anticipate revenue and profit increases.
At Sony Life, we expect income from insurance premiums to grow, due
to solid growth in the policy amount in force, leading to higher
revenues and profit. We forecast a rise in MCEV, owing to theacquisition of new policies.
In line with our medium-term dividend policy, for FY2018 we expect toraise the dividend amount by ¥2.5 per share compared with FY2017,
to ¥62.5, taking into overall account such factors as the operating
environment, growth in business scale, and higher profit based on
economic value. We aim to continue steadily increasing dividends going
forward.

Sony Financial Holdings Inc. All Rights Reserved

4Attachment

Highlights of Consolidated Operating Performance (1)＜Consolidated＞
Ordinary revenues
Ordinary profit

1,381.6+8.8%Life insurance
business

1,503.6

Non-life
insurancebusiness
Bankingbusiness
Intersegment
adjustments*

+0.8%

66.8

66.3

FY2016FY2017FY2016FY2017

Ordinary revenues

1,243.9

1,351.2+107.2+8.6%

Ordinary profit

56.8

54.1

(2.6)

(4.7%)

Ordinary revenues

102.3

110.0

+7.7

+7.6%

Ordinary profit

5.0

6.5

+1.5

+31.5%

Ordinary revenues

38.5

39.9

+1.4

+3.7%

Ordinary profit

5.0

7.1

+2.0

+41.4%

Ordinary revenues

(3.1)

2.3

+5.4

－

Ordinary profit

(0.5)

(1.0)

(0.4)

－

1,381.6

1,503.6+121.9+8.8%

Ordinary profit

66.3

66.8

+0.5

+0.8%

Profit attributableto owners of theparent

41.6

51.8

+10.2

+24.7%

Ordinary revenues

Consolidated(JPY bn)(JPY bn)

Change*“Intersegment adjustments” is mainly from SFH and the nursing care business.
Proud Life Inc., a company of nursing care business, has been included in the scope of
consolidation from FY2017.2Q.
(Note) Comprehensive income : FY2016: ¥21.4 billion, FY2017: ¥ 52.2 billion(JPY bn)

Consolidated

Mar. 18

601.1

625.4

+24.2

+4.0%

11,471.8

12,401.4+929.6+8.1%

Net assets
Total assets

Change from
Mar. 17Mar. 17

Sony Financial Holdings Inc. All Rights Reserved

5Highlights of Consolidated Operating Performance (2) Life Insurance Business︓Ordinary revenues grew year-on-year due to higher income from insurance

premiums, owing to a steady rise in the policy amount in force. Ordinary profit decreased year on year
due to a higher provision of policy reserve relating to the acquisition of new policies reflecting a revisionin the standard yields used for calculating policy reserves and lower gains on sale of securities in thegeneral account. On the other hand, gains/losses related to market fluctuations for variable life
insurance* improved year on year, which partially offset the negative impact of the above-mentioned
decreases in ordinary profit.
*Total of (a) the provision of policy reserves for minimum guarantees for variable life insurance according to market fluctuationsand (b) net gains/losses on derivative transactions to hedge market risks for the products Non-life Insurance Business: Ordinary revenues expanded year on year, owing to an increase in net

premiums written for mainstay automobile insurance. Ordinary profit increased year on year due to a
decline in the loss ratio, driven mainly by a lower car accident ratio.

 Banking Business︓Ordinary revenues rose year on year due to increases in interest income on loans inline with a favorably growing balance of mortgage loans and on investment securities. Ordinary profit
grew year on year, due to a decrease in operating expenses, especially in advertising expenses for thecard loan business.

 Ordinary revenues increased 8.8% year on year, to ¥1,503.6 billion, owing to increases in ordinary

revenues from all the businesses: life insurance, non-life insurance and banking businesses. Ordinary
profit increased 0.8% year on year, to ¥66.8 billion. By business segment, ordinary profit from the life
insurance business decreased, ordinary profit from the non-life insurance and banking businesses rose.
Profit attributable to owners of the parent was up 24.7% year on year, to ¥51.8 billion. This increase wasdue mainly to a gain on disposal of fixed assets from a sale of the real estate held for investment of¥13.2 billion in the life insurance business, which was recorded in extraordinary gains.
Sony Financial Holdings Inc. All Rights Reserved

6

Attachment

Highlights of Operating Performance:
Sony Life (Non-consolidated)
Ordinary profit

Ordinary revenues

1,243.7+8.6%(JPY bn)

FY2016FY20171,243.7

1,351.0+107.3+8.6%

Income from insurance premiums

956.7

1,059.2+102.5+10.7%

Investment income

245.3

243.2

(2.0)

(0.8%)

148.2

157.7

+9.4

+6.4%

Gains on sale of securities

1.3

0

(1.3)

(100.0%)Foreign exchange gains, net

14.6

－

(14.6)(100.0%)Gains on separate accounts, net

76.4

80.9

+4.5

+5.9%

1,183.5

1,294.7+111.1+9.4%

Insurance claims and other payments

372.4

436.5

+64.1

+17.2%

Provision for policy reserves and others

596.7

638.3

+41.6

+7.0%

Investment expenses

36.1

33.1

(3.0)

(8.5%)

30.0

11.4(18.6)(62.1%)

Ordinary revenues

1,351.0

Interest income and dividends

Ordinary expenses(6.4%)

56.3

60.1(JPY bn)

Losses on derivatives, net
Foreign exchange losses, net

FY2016FY2017

Operating expenses
Ordinary profit◆ Ordinary revenues increased but ordinary profit decreased.
◆ Income from insurance premiums increased owing to a steady rise in
the policy amount in force.
◆ Investment income decreased due to a decrease in gains on foreignexchange which turned into losses.
◆ Ordinary profit decreased due to a higher provision of policy reserve
relating to the acquisition of new policies reflecting a revision in thestandard yields used for calculating policy reserves and lower gains
on sale of securities in the general account. On the other hand,
gains/losses related to market fluctuations for variable life insurance*
improved year on year, which partially offset the negative impact of
the above-mentioned decreases in ordinary profit.

Gains on disposal of fixed assets
Net income

－

15.2

+15.2

－

137.0

139.9

+2.8

+2.1%

60.1

56.3

(3.8)

(6.4%)

－

13.2

+13.2

－

35.1

45.1

+9.9

+28.3%

Mar. 17Mar. 18

Change from Mar. 17

Securities

8,093.1

8,765.9+672.7

Policy reserves

7,929.9

8,566.0+636.1

+8.0%

473.5

492.7

+19.1

+4.1%

127.7

124.9

(2.8)

(2.2%)(JPY bn)

Net assets
Net unrealized gains on other securities*Total of (a) the provision of policy reserves for minimum guarantees forvariable life insurance according to market fluctuations and (b) net
gains/losses on derivative transactions to hedge market risks for the products

ChangeTotal assets
Separate account assets+8.3%

8,873.6

9,567.6+694.0

+7.8%

989.6

1,128.8+139.2+14.1%

7

Sony Financial Holdings Inc. All Rights Reserved

Overview of Operating Performance:
Sony Life (Non-consolidated)
FY2016FY2017

New policy amount

4,957.5

5,287.9+6.7%

Lapse and surrender amount

1,839.3

2,250.8+22.4%

Lapse and surrender rate

4.27%

4.97%

+0.70pt(JPY bn)

Change45,334.1

47,253.4+4.2%

Annualized premiums from new policies

78.1

73.0

(6.5%)Of which, third-sector products

15.7

12.9

(17.4%)

820.8

848.8

+3.4%

187.4

191.8

+2.4%

Policy amount in force

Annualized premiums from insurance in force
Of which, third-sector products＜Reasons for changes＞◆ Increased due to higher salesof family income insurance andU.S. dollar-denominatedinsurance.
◆ Decreased due mainly to lower
sales of term life insurance andliving benefit insurance, despite
favorable sales of U.S. dollardenominated insurance, variable
life insurance and individual
annuities.

Notes:
1. Figures for new policy amount, lapse and surrender amount, lapse and surrender rate, policy amount in force,
annualized premiums from new policies and annualized premiums from insurance in force are calculated as thetotal of individual life insurance and individual annuities.
2. The lapse and surrender rate shows the ratio derived by dividing the amount of lapses and surrenders,
not adjusted for policy amount decreases, increases, and reinstatements, by the policy amount in force at the
beginning of the fiscal year.

(JPY bn)

FY2016FY2017

ChangeGains from investment, net (General account)

132.7

129.2

(2.6%)

Core profit

83.8

81.3

(2.9%)

Positive spread

15.4

17.7

+14.9%

Non-consolidated solvency margin ratio

Mar. 17Mar. 18

ChangefromMar. 17

2,568.8%

2,624.3%+55.5pt

Sony Financial Holdings Inc. All Rights Reserved◆ Decreased due to a higher
provision of policy reserve
relating to the acquisition of
new policies reflecting a revisionin the standard yields used for
calculating policy reserves,
despite an increase in profit
from accumulated policies inforce and a rise in positive
spread.

8

Attachment

Operating Performance :Sony Life (Non-consolidated) (1)
Number and Amount of New Policies

Annualized Premiums from New Policies(Individual Life Insurance + Individual Annuities)
New policy amount（JPY tn）（Thousandsof policies)

7

513
5.15

5

Annualized premiums from new policies

Number of new policies

629

6(Individual Life Insurance + Individual Annuities)

+5.2%

4.95

540

600

5.28

500

+6.7%

400

（JPY bn）

85.0

80

Of which, third-sector

78.1(6.5%)

73.0

60

4
300
3

40

200

2

20
100

1
0

0
FY2015FY2016(17.4%)

15.7

15.7

FY2015FY201612.9

0FY2017FY20179Sony Financial Holdings Inc. All Rights Reserved

Operating Performance :Sony Life (Non-consolidated) (2)
Number and Amount of Policies in Force

Annualized Premiums from Insurance in Force(Individual Life Insurance + Individual Annuities)
Policy amount in force

50

Annualized premiums from insurance in force

Number of policies in force

Of which, third-sector（Millionsof policies) （JPY bn）（JPY tn）

60(Individual Life Insurance + Individual Annuities)

7.04
43.1

7.30

+3.6%

7.56

800

781.3

6

+4.2%

30

4

400

2

200

10
0

0
Mar. 17

848.8

600

20

Mar. 16

+3.4%

47.2

45.3

40

8

820.8

Mar. 18

+2.4%

179.7

187.4

191.8

Mar. 16Mar. 17Mar. 180Sony Financial Holdings Inc. All Rights Reserved

10Attachment

Operating Performance :Sony Life (Non-consolidated) (3)Lapse and Surrender Rate*(Individual Life Insurance + Individual Annuities)

（%）

8

6

4.72

4.97
4.27

4

+0.70pt

20FY2015FY2016FY2017*The lapse and surrender rate shows the ratio derived by dividing the amount oflapses and surrenders, not adjusted for policy amount decreases, increases, andreinstatements, by the policy amount in force at the beginning of the fiscal year.

11

Sony Financial Holdings Inc. All Rights Reserved

Operating Performance :Sony Life (Non-consolidated) (4)Interest Income and Dividends

Income from Insurance Premiums(JPY bn)

1,028.0
1,000

1,059.2
956.7(JPY bn)

160
140＋10.7%

157.7
141.4

148.2
＋6.4%

120

800

100
600

80
60

400

40
200
20
0
FY2015FY2016FY20170
FY2015

Sony Financial Holdings Inc. All Rights Reserved

FY2016FY2017

12

Attachment

Operating Performance :Sony Life (Non-consolidated) (5)Ordinary Profit

Core Profit(JPY bn)(JPY bn)

81.3

83.8

80

60

(2.9%)

60.7

60.1

56.3
(6.4%)

60

40

43.0
40

20
20

0

0
FY2015FY2016FY2015FY2017FY2017(Reference) Main differences from core profit(Reference) Impact on core profit(JPY bn)

FY2016FY2015FY2016FY2017(JPY bn)

FY2015

15.3

15.4

17.7

(34.7)(7.8)(18.7)

Capital gains (losses) excluding gains or losses onhedges (*)
Gains (losses) on hedges of variable life insurance

62.5

76.2

82.4

Positive spread
Provision of policy reserves for minimum
guarantees for variable life insurance (*)
OthersProvision of contingency reserve (*)

FY2016FY2017

20.4

(0.4)

(9.0)

3.9

(15.6)

(8.4)

(6.4)

(7.2)

(7.4)

*“Provision of policy reserves for minimum guarantees for variable life insurance” and “Provision of contingency reserve” are described as negative amount.
Capital gains (losses) exclude gains or losses on hedges of variable life insurance.

13

Sony Financial Holdings Inc. All Rights Reserved

Operating Performance :Sony Life (Non-consolidated) (6)
Number of Lifeplanner Sales Employees+209(Number)

5,142
4,933

5,000
4,612

4,682

4,751

4,730

Sep. 16

Dec. 16

4,942

4,974

4,968
+174

4,500

4,000

3,500

3,0000Mar. 16

Jun. 16Mar. 17

Jun. 17

Sony Financial Holdings Inc. All Rights Reserved

Sep. 17

Dec. 17Mar. 18
14

Attachment

Operating Performance :Sony Life (Non-consolidated) (7)Breakdown of General Account Assets
Mar. 17<Asset management review>

Mar. 18

Amount%Amount%Japanese bonds(including JGBs)

6,828.7

86.6%

7,281.1

86.3%

Japanese stocks

37.6

0.5%

38.4

0.5%

Foreign bonds

274.3

3.5%

366.5

4.3%

Foreign stocks

31.5

0.4%

30.3

0.4%

Money held in trust

273.8

3.5%

270.5

3.2%

Policy loans

180.3

2.3%

189.4

2.2%

Real estate*

117.5

1.5%

92.3

1.1%

Cash and call loans

40.8

0.5%

40.8

0.5%

Others

99.1

1.3%

129.1

1.5%

7,884.0

100.0%

8,438.8

100.0%(JPY bn)

Total

We have continued to accumulate
ultralong-term bonds to match the liability
characteristics of insurance policies withlong-term maturities with the aim of
reducing interest rate risk.
<Bond duration>
Mar. 16 21.8 years
Mar. 17 21.3 years
Mar. 18 21.4 years■ Investment in the money held in trust is
mainly into Japanese bonds.
■ The holding ratio on the real status ofJapanese bonds including those invested
in the money held in trust in the generalaccount : Mar. 18・・・89.5%（Mar. 17・・・90.1%）*The decrease in real estate was owing to a sale of the realestate held for investment in FY2017.3Q.

*Real estate is the total of land, buildings, and construction in progress.

15

Sony Financial Holdings Inc. All Rights Reserved

Operating Performance :Sony Life (Non-consolidated) (8)Average Assumed Interest Rate andInvestment Yield for Core Profit

Positive Spread

Average assumed interest rate

17.7

(JPY bn)+14.9%

15

15.3

15.4

Investment yield for core profit
（%）

3.00

2.31
10
2.00

2.06

2.24

2.22

2.00

1.97

5

1.00

0
FY2015FY2016FY2017FY2015

Sony Financial Holdings Inc. All Rights Reserved

FY2016FY2017

16

Attachment

Operating Performance :Sony Life (Non-consolidated) (9)Non-consolidated Solvency Margin Ratio
（%）

3,000

2,722.8

2,624.3

2,568.8

2,500+55.5pt

2,000

1,500

1,000
0

Mar. 16Mar. 17Mar. 1817

Sony Financial Holdings Inc. All Rights Reserved

Highlights of Operating Performance:
Sony Assurance
Ordinary revenues

Ordinary profit
FY2016FY2017

102.3

110.0

+7.7

+7.6%

Underwriting income

100.3

108.3

+7.9

+8.0%

Investment income

1.9

1.7

(0.2)

(11.5%)

97.3

103.5

+6.1

+6.4%

Underwriting expenses

70.5

74.4

+3.8

+5.5%

Operating general andadministrative expenses

26.7

29.0

+2.3

+8.7%

Ordinary profit

4.9

6.5

+1.5

+31.6%Net income

3.5

4.8

+1.3

+37.2%

Mar. 17Mar. 18

Underwriting reserves

106.1

117.0

+10.9

+10.3%Net assets

29.4

33.1

+3.7

+12.9%

Total assets

186.5

204.3

+17.8

+9.6%

(JPY bn)

102.3

+7.6%

+31.6%

110.0

Ordinary revenues

6.5

4.9
(JPY bn)

FY2016FY2017◆Both ordinary revenues and ordinary profit
increased year on year.
◆Ordinary revenues expanded owing to anincrease in net premiums written for
mainstay automobile insurance.
◆Due to a decline in the loss ratio, driven
by a lower car accident ratio, ordinary profit
increased year on year.

Ordinary expenses(JPY bn)

Sony Financial Holdings Inc. All Rights Reserved

ChangeChange from
Mar. 17

18

Attachment

Overview of Operating Performance:
Sony Assurance(JPY bn)

FY2016FY2017

Change<Reasons for changes>

Direct premiums written

99.0

107.0

+8.1%

Net premiums written

100.2

108.2

+8.0%

Net losses paid

50.1

52.4

+4.6%

Underwriting profit

3.0

4.8

+58.4%Net loss ratio

57.5%

55.9%

(1.6pt)Net expense ratio

28.3%

28.5%

+0.2ptCombined ratio

85.8%

84.4%

(1.4pt)◆ Increased in its mainstay
automobile insurance.

Notes:Net loss ratio = (Net losses paid + Loss adjustment expenses ) / Net premiums written
Net expense ratio = Expenses related to underwriting / Net premiums written

FY2016FY2017

ChangeE. I. loss ratio

62.3%

60.7%

(1.6pt)E. I. loss ratio +Net expense ratio

90.6%

89.2%

(1.4pt)◆ Declined due to a lower car
accident ratio in automobile
insurance.

Note: E.I. loss ratio = (Net losses paid + Provision for reserve for outstanding losses + Loss adjustment expenses) / Earned
premiums [Earthquake insurance and compulsory automobile liability insurance are excluded from the above calculation.]Mar. 17Mar. 18

Number of policies in force

1.89 mn

2.07 mnNon-consolidated
solvency margin ratio

730.8%

782.1%

Change from
Mar. 17+0.18 mn

+9.7%

+51.3pt

19

Sony Financial Holdings Inc. All Rights ReservedSony Assuranceʼs Underwriting Performanceby Type of Policy
Net Premiums Written

Direct Premiums Written(JPY ｍn)

FY2017

Change245

206(15.9%)－－－

Personal accident

8,767

8,679

(1.0%)

Voluntary automobile

90,001

98,123

+9.0%

－

－

－

99,014

107,008

+8.1%

Fire
MarineCompulsory
automobile liability
Total

FY2016(JPY ｍn)

FY2016FY2017

Change

Fire

24

16

(34.4%)

Marine(2)0－Personal accident

9,044

8,887

(1.7%)

Voluntary automobile

89,746

97,880+9.1%

Compulsory
automobile liability

1,460

1,469

+0.6%

Total

100,274

108,254+8.0%*Medical insurance is included in personal accident.

Net losses paid
(JPY ｍn)

FY2017

Change66(1.4%)(6)2－

Personal accident

2,615

2,692

+2.9%

Voluntary automobile

46,26348,464+4.8%

Compulsory
automobile liability

1,301

1,316

+1.1%

Total

50,181

52,482+4.6%

FireMarineFY2016

Sony Financial Holdings Inc. All Rights Reserved20

Attachment

Operating Performance:
Sony Assurance (1)Ordinary Profit andAdjusted Ordinary Profit

Net Premiums Written andNumber of Policies in Force
Voluntary automobile insurance
Others(JPY bn)

1.79

120

95.5

100

2.07

+9.7%

1.89

(mn ofpolicies)(JPY bn)

10.0

100

+22.3%

2

8.1

7.6

80

108.2

100.2

Adjusted ordinary profit

Ordinary profit

Personal accident insurance

Number of policies in force

6.5

+8.0%

1.5

33

60

27

80

4.6

40

+31.6%

4.9

1

60

20
40
0.5

0
FY201520

FY2016FY2017*Adjusted ordinary profit = Ordinary profit + Provision for catastrophe reserve

00
FY2015FY2016FY2017

The number of policies in force is the total of automobile insurance andmedical insurance policies.
Most of personal accident insurance is medical insurance.

(Reference) Provision for catastrophe reserve(JPY bn)

Provision for catastrophe reserve

FY2015FY2016FY2017

3.0

3.1

3.4

*Provision for catastrophe reserve is described as positive amount.

21

Sony Financial Holdings Inc. All Rights Reserved

Operating Performance:
Sony Assurance (2)Earned/Incurred Loss Ratio +Net Expense Ratio
Earned/Incurred loss ratio(Reference) Combined Ratio＜参考＞(Net Loss Ratio+ Net Expense Ratio)
Net loss ratio

Net expense ratio

（%）

（%）

100

100

90.4

89.2

90.6

63.3

62.3

(1.6pt)

60.7

85.8

60

84.4
(1.4pt)

55.9

57.8

57.5

(1.6pt)

27.1

28.3

+0.2pt

FY2015FY2016

40

40

20

84.8
80

(1.4pt)80

60

Net expense ratio

27.1

28.3

FY2015FY2016+0.2pt

28.5

0

20

28.5

0
FY2017

Notes:
Earned/Incurred loss ratio = (Net losses paid + Provision for reserve foroutstanding losses + Loss adjustment expenses) / Earned premiums[Earthquake insurance and compulsory automobile liability insurance are excluded
from the above calculation]

FY2017

Notes:Net loss ratio = (Net losses paid + Loss adjustment expenses) /Net premiums written
Net expense ratio = Expenses related to underwriting / Net premiums writtenSony Financial Holdings Inc. All Rights Reserved

22

Attachment

Operating Performance:
Sony Assurance (3)Non-consolidated Solvency Margin Ratio

（%）

800

693.5%

782.1%

730.8%+51.3pt

600

400

200

0
Mar. 16Mar. 17Mar. 1823

Sony Financial Holdings Inc. All Rights Reserved

Highlights of Operating Performance:
Sony Bank (Consolidated/Non-consolidated)<Consolidated>
Ordinary revenues
Ordinary profit

38.5<Consolidated>
FY2017

38.5

39.9

+1.4

+3.7%

Ordinary profit

5.0

7.1

+2.1

+42.2%

Profit attributable to owners of
the parent

3.3

4.7

+1.4

+42.8%FY2016FY2017

Ordinary revenues

35.1

36.2

+1.1

Gross operating profit

21.1

21.4

+0.3

+1.4%

Net interest income

17.9

20.6

+2.7

+15.2%Net fees and commissions

(1.5)

(2.9)

(1.3)

－

Net other operating income(JPY bn)

+3.7%

39.9

7.1
+42.2%

5.0(JPY bn)

FY2016FY2016

Ordinary revenues

FY2017＜Consolidated＞◆Ordinary revenues rose year on year due to increases in interest
income on loans in line with a favorably growing balance ofmortgage loans and on investment securities.
◆Ordinary profit grew year on year, due to a decrease in operating
expenses, especially in advertising expenses for the card loanbusiness.
＜Non-consolidated＞◆Both gross operating profit and net operating profit increased.
・Net interest income increased due to increases in interest
income on loans and investment securities.
・Net fees and commissions decreased due mainly to lower fees
and commissions on mortgage loans, in addition to higher fees
paid for loan guarantees reflecting the growing loan balance.
・Net other operating income decreased due mainly to a decreasein gains on foreign exchange transactions.

Change<Non-consolidated>(JPY bn)

Change

+3.3%

4.7

3.7

(1.0)

(22.4%)

General and administrative
expenses

16.5

15.5

(1.0)

(6.1%)Net operating profit

4.6

5.9

+1.3

+28.4%

Ordinary profit

4.6

6.5

+1.9

+41.5%Net income

3.1

4.4

+1.2

+40.9%

Mar. 17Mar. 18

81.3

85.7

+4.3

+5.4%

4.7

6.0

+1.2

+26.4%

2,424.2

2,635.0+210.7+8.7%(JPY bn)
Net assets
Net unrealized gains onother securities, net of taxes
Total assets

Sony Financial Holdings Inc. All Rights Reserved

Change from
Mar. 1724

Attachment

Overview of Operating Performance:
Sony Bank (Non-consolidated) (1)<Reasons for changes>

Change from
Mar. 17Mar. 17Mar. 18

Customer assets

2,227.1

2,343.0+115.9+5.2%

Deposits

2,112.9

2,219.3+106.3+5.0%

Yen

1,764.9

1,814.7

+49.7

+2.8%

348.0

404.6

+56.5

+16.3%

114.1

123.7

+9.6

+8.5%

Loans outstanding

1,539.6

1,596.3

+56.7

+3.7%

Mortgage loans

1,452.4

1,525.5

+73.0

+5.0%

Card loans

18.0

18.8

+0.8

+4.5%

Others69.0

51.8*1(17.1)(24.8%)

1.24 mn

1.35 mn

+0.10
mn
*1

+8.8%

Non-performing assets ratio*2(Based on Financial*2
Reconstruction Law)

0.19%

0.12%

(0.06)pt

Capital adequacy ratio *3(domestic criteria)

9.75%

10.45%+0.70pt(JPY bn)

Foreign currency
Investment trusts

Number of accounts◆ Increased in yen ordinary deposit
balance due mainly to anincrease in newly accumulated
funds via the increased numberof accounts.
◆ Increased in foreign currency
deposits, due to an increase intime deposits, led by the impactof an exchange cost campaign
and promotional effect from ofa rise in U.S. interest rates on US
dollar-denominated time
deposits.
◆ Rose due to a steady increase inmortgage loans, despite adecrease in demand forrefinancing these loans.

*1 Loans in others include corporate loans of ¥51.8 billion*2 Non-performing loans (loans based on the Financial Reconstruction Act) /Total loan exposure*3 Please refer to the graph of the non-consolidated capital adequacy ratio (domestic criteria) on page 28.
Capital adequacy ratios has been calculated by applying fundamental internal rating based approach (FIRB) from March 31, 2017.

25

Sony Financial Holdings Inc. All Rights Reserved

Overview of Operating Performance:
Sony Bank (Non-consolidated) (2)<Reference> On Managerial Accounting Basis(JPY bn)<Reference> Interest Spread(Managerial Accounting Basis)

FY2016FY2017

21.0

21.3

+0.3

+1.5%

①

20.6

23.0

+2.3

+11.6%

②

(0.9)

(2.5)

(1.5)

―

1.4

0.9

(0.4)

(34.9%)

Gross operating profit (core profit)(A)＝①＋②

19.6

20.4

+0.8

+4.2%

Operating expenses and otherexpenses ③

16.5

15.5

(1.0)

(6.1%)Net operating profit (core profit)＝(A)－③

3.1

4.9

+1.8

+58.4%

Gross operating profit
Net interest income*1
Net fees and commissions*2
Net other operating income*3

Change■Managerial accounting basis
The following adjustments are made to the figures on a financial account for profits andlosses more appropriately.
*1: Net interest income: Includes profits and losses associated with fund investment
recorded in net other operating income, including gains or losses from currency swap
transactions.
*2: Net fees and commissions: Includes profits and losses for customer dealings in foreign
currency transactions recorded in net other operating income.
*3: Net other operating income: After the above adjustments (*1 and *2), mainly consistsof profits and losses for bond and derivative dealing transactions.
■Core profit
Profits and losses exclude net other operating income, which includes those on bond andderivative dealing transactions, and stands for Sony Bankʼs basic profits.

Yield on investment

Yield on financing

Interest spread
（%）

1

1.19
0.94

1.13
(0.03pt)

0.91

0.5

0.25

0.22

0
FY2016FY2017

Note: Interest spread=(Yield on investment)-(Yield on financing)Sony Financial Holdings Inc. All Rights Reserved26

Attachment

Operating Performance:
Sony Bank (Non-consolidated) (1)
Deposits

Loans

Foreign currency deposits

Yen Deposits

Mortgage loans(JPY bn)(JPY bn)

2,219.3

2,112.9
2,000

Others1,923.5

1,500+106.3348.0

1,596.3

1,539.6
87.1

1,344.1

404.6

+56.7

70.7 *

107.0

335.5

1,500

1,000
1,525.5

1,452.4

1,000

1,237.1

1,814.7

1,764.9

1,587.9

500

500

0

0
Mar. 16Mar. 17Mar. 16Mar. 18

Mar. 17Mar. 18*Corporate loans of ¥51.8 billion. Card loans of ¥18.8 billion.

27

Sony Financial Holdings Inc. All Rights Reserved

Operating Performance:
Sony Bank (Non-consolidated) (2)Balance of Securities by Credit Rating
AAA

AA

BBB

Others

Non-Consolidated Capital Adequacy Ratio(Domestic Criteria)

A(JPY bn)

631.2

620.9
600

+42.9

18.1

15

26.1

16.3

306.8
307.0

（%）

674.2

10

9.89

303.0

+0.70pt

400

109.8

200

10.45

9.75

5

135.3
165.2
232.4
126.3

160.2

0
Mar. 160Mar. 16Mar. 17Mar. 18

Mar. 17Mar. 18

Notes:
1. Calculated based on the standard FSA Notification No. 19 (2006), which
establishes standards based on Article 14-2 of the Banking Act of Japan for
determining the capital adequacy of a bank in light of the assets held by the bank.
2. Capital adequacy ratios has been calculated by applying fundamental internalrating based approach (FIRB) from March 31, 2017.

Sony Financial Holdings Inc. All Rights Reserved28

Attachment

Forecast of Consolidated Financial
Results for FY2018

29

Sony Financial Holdings Inc. All Rights Reserved

Forecast of Consolidated Financial Results for FY2018
Ordinary revenues, ordinary profit and profit attributable to owners of the parent
are expected to increase.
(JPY bn)

FY2017（Actual）

Ordinary revenues

FY2018（Forecast）

1,503.6

1,578.0

Changes+4.9%

1,351.2

1,416.1+4.8%

Non-life insurance business

110.0

112.3

+2.0%

Banking business

39.9

42.8

+7.2%

66.8

83.0

+24.2%

Life insurance business

54.1

70.9

+30.9%

Non-life insurance business

6.5

6.5

(1.1%)

Banking business

7.1

7.0

(2.0%)

51.8

55.0

+6.0%

Life insurance business

Ordinary profit

Profit attributable to owners of the parent

For FY2018, stable business growth is expected to continue in all the businesses.
<Segment information for ordinary revenues and ordinary profit>■Life insurance businessWe forecast ordinary revenues to increase from FY2017, owing to robust income from insurance premiums.
We also anticipate a year-on-year rise in ordinary profit, stemming from an increase in profit on higher policies in force, a rise in gains on sale of securities,
and an improvement in net gains/losses on derivative transactions to hedge market risks for available-for-sale securities.
■Non-life insurance businessWe expect ordinary revenues to increase from FY2017, in line with growth in net premiums written, primarily for automobile insurance. Despite the higher
revenues, we believe ordinary profit will be flat year on year, with the loss ratio rising slightly from FY2017, when the ratio was lower than we had anticipated.
■Banking businessWe expect ordinary revenues to rise year on year due to stable business growth stemming from the ongoing steady accumulation of mortgage loans andstrengthening of foreign currency business. Although we anticipate a rise in gross operating profit in line with revenue growth, we expect ordinary profit to beflat year on year, as operating expenses rise.

Sony Financial Holdings Inc. All Rights Reserved30

Attachment

Dividend Forecast for FY201831

Sony Financial Holdings Inc. All Rights Reserved

Dividend Forecast for FY2018■Medium-term Dividend Policy : Unchanged
We aim for steady increases in dividends in line with earnings growth over the medium to long term,
while securing sufficient internal reserves to ensure the financial soundness of Group companies andto invest in growth fields. Management will examine earnings growth over the medium to long termby placing more importance on economic value-based profit indicators that are more suitable forvaluing the growth of the life insurance business, in addition to statutory profit. Furthermore,management will determine specific dividend amounts for each year by taking into account acomprehensive range of factors surrounding the Sony Financial Group.

■Dividend results/forecast

Dividends for FY2017 are expected to be ¥60 per share.
For FY2018, considering the business environment, growth of our group and the level of economic valuebased profit growth, we forecast dividends of ¥62.5 per share, an increase of ¥2.5 from the planed
dividends of ¥60 per share for FY2017.
FY2014
Dividend per share¥40.0

FY2015¥55.0

FY2016¥55.0

Sony Financial Holdings Inc. All Rights Reserved

FY2017（Plan）¥60.0

FY2018(Forecast)
¥62.5

32

Attachment

Sony Lifeʼs Preliminary MCEV and ESR
as of March 31, 2018

Please keep in mind that the validity of these calculations has not been verified by outside specialists
as of the end of March, 2018.
The calculation of MCEV as of March 31, 2018, in accordance with the MCEV principles and verified byoutside specialists, is scheduled to be announced on May 21, 2018.
A part of the calculations of MCEV adopted simplified method for that as of December 31, 2017.
*In this part, figures, ratios and percentages changes have been rounded.

33

Sony Financial Holdings Inc. All Rights ReservedSony Lifeʼs MCEVMar. 17

Dec. 17Mar. 18

ChangefromMar. 17

ChangefromDec. 17

1,441.1

1,509.6

1,633.2+192.1+123.6

Adjusted net worth

1,657.7

1,717.1

1,786.1+128.4+69.0

Value of existing business(216.7)(207.5)(152.9)

+63.7

+54.6

(JPY bn)

FY16.4Q(3M)

FY17.1Q(3M)

FY17.2Q(3M)

FY17.3Q(3M)

FY17.4Q(3M)

FY17.4Q(12M)

New business value

14.1

12.2

17.2

19.9

21.2

70.4

New business margin

3.8%

4.6%

6.4%

6.0%

6.1%

5.8%

(JPY bn)

MCEV*3 Reasons for changes in MCEV
・MCEV as of March 31, 2018 increased ¥123.6 billion form December 31, 2017, due mainly to a revision in theinsurance risk measurement method and favorable acquisition of new policies.
New business value/ New business margin
・New business value for FY17.4Q (3M) was ¥21.2 billion due to a favorable acquisition of new policies.
・New business margin for FY17.4Q (3M) increased 0.1pt from December 31, 2017, due mainly to the change of
product portfolio, despite a decrease in interest rates in Japanese yen.
Notes:
1. Calculated MCEV as of December 31, 2017 onward by using updated economic assumptions and lapse and surrender rate from March 31, 2017.
2. New business value is calculated accumulating new business value for each month based on economic assumptions at the end of each month. The insurance risk
measurement method and others have not changed for new business value and new business margin.
3. The amount as of March 31, 2018 was after a revision in the insurance risk measurement method and others. Please refer to page 48,49 for the details*Please refer to the appendix page 50 for trend on JGB yields.

Sony Financial Holdings Inc. All Rights Reserved34

Attachment

Sony Lifeʼs ESR(JPY bn)

Insurance risk

*1Mar. 17

Dec. 17Mar. 18 *3

937.5

970.4

497.5

405.1

352.5

380.6

308.9

257.2

275.3

Operational risk

28.1

29.5

31.0

Counter party risk

1.9

2.8

2.6

(392.0)(383.1)(182.0)

980.6

972.2

729.7

Market-related risk*2

Of which, interest rate risk

Variance effect
The risk amount based on
economic value(JPY bn)

MCEV + Frictional costs
ESR

Mar. 17

Dec. 17Mar. 18 *3

1,476.6

1,539.3

1,655.8

151%

158%

227%

Notes:
1. The risk amount based on economic value refers to the total amount of Sony Lifeʼs risks comprehensively examined by a market consistent approach,including insurance risk and market-related risk and others.
2. The solvency risk capital on an economic value basis is calibrated at VaR (99.5) over one year and based on the internal model.
3. ESR=(MCEV + Frictional costs) / Risk amount based on economic value.

 The risk amount based on economic value as of March 31, 2018 amounted to ¥729.7 billion, decreased ¥242.4
billion from December 31, 2017, due mainly to a revision in the insurance risk measurement method and others.
 ESR as of March 31, 2018 was 227%, up 69pt from December, 2017 due to a revision in the insurance risk
measurement method and others.
*1 Risk amount excluding the variance effect within Life module and Health module.
*2 Risk amount excluding the variance effect within market-related risk.
*3 The amount as of March 31, 2018 was after a revision in the insurance risk measurement method and others. Please refer to page 48,49 for the details.

Sony Financial Holdings Inc. All Rights Reserved

35

AppendixSony Financial Holdings Inc. All Rights Reserved36

Attachment

Recent Topics 1
AEGON Sony Life Insurance

Launch of sales: December 1, 2009
Common stock: ¥36.9 billion (including capital reserves of ¥18.45 billion)
Equity ownership: Sony Life insurance Co Ltd 50%, AEGON international B.V. 50%
Marketing products: Individual Variable Annuities
Sales Channels: Lifeplanner sales employees and partner Banks (33*) *As of May 14, 2018

SA Reinsurance Ltd

Established: October 29, 2009
Common stock: ¥15.9 billion
Equity ownership: Sony Life insurance Co., Ltd. 50%, AEGON international B.V. 50%
Business: Reinsurance business*AEGON Sony Life Insurance and SA Reinsurance are equity method companies, 50-50 joint ventures established by Sony Life and AEGON Group.

Sony Bankʼs Mortgage Loans through Sony Life
■Sony Life accounts for 16% of the amount of new mortgage loans for FY2017

Sony Life accounts for 20% of the balance of mortgage loans as of March 31, 2018

*Sony Life started handling banking agency business in January 2008.

Sony Assuranceʼs Auto Insurance Sold by Sony Life
■Sony Life accounts for 4% of new automobile policies for FY2017*Sony Life started handling automobile insurance in May 2001.

Sony Financial Holdings Inc. All Rights Reserved

37

Recent Topics 2＜Highlights on and after FY17＞
2017-04-02

Sony Life commenced sale of new product: “Living Benefit Decreasing Term Life Insurance(Living Standard Type / Non-Participating Type)”

2017-05-01

Sony Lifecare Group opened the nursing care home “SONARE Urawa” in Saitama Prefecture

2017-06-21

Sony Bank changed its President, Representative Director

2017-06-28

Sony Financial Holdings, Sony Life , Sony Assurance and Sony Bank has formulated and disclosed “Customer-First Business
Operation Policy”

2017-07-10

Sony Lifecare converted Yuuai Holdigns Co., Ltd. to a wholly owned subsidiary (Yuuai Holding changed its
corporate name to Proud Life Inc. on Aug. 1, 2017)2017-08-08

Sony Bank began providing cloudfunding platform “Sony Bank GATE”

2017-08-10

Sony Life established a joint venture, Sony Life Financial Advisors Pte. Ltd., with Starts Securities Co., Ltd. in Singapore

2017-09-01

Sony Bank opened “CONCULTING PLAZA” in Ginza, Tokyo

2017-10-02

Sony Life commenced sale of new product: “U.S. Dollar-Denominated Single Premium Whole Life Insurance(Non-Notification Type)” and “U.S. Dollar-Denominated Living Benefit Whole Life Insurance (Living Standard Type)”

2017-10-09

Sony Assurance began offering a web-based insurance claims service, allowing policyholders to make medical insurance claims
via its website
Sony Bank began issuing “Takashimaya Platinum Debit Card” and recruiting its members throughan alliance with Takashimaya Co., Ltd. and Takashimaya Credit Co., Ltd.

2017-11-01

Sony Assurance expanded its “Secom accident on-site rush service” for automobile insurance policyholders

2017-11-29

Sony Financial Holdings issued ¥10 billion of No.3 unsecured corporate bonds

2017-12-01

Sony Assurance promote tie-up with auto repair shops which were certificated by TÜV Rheinland Japan Ltd.

2017-12-14

Sony Bank began offering “WealthNavi for Sony Bank” an automated asset investment service, in collaboration with
WealthNavi Inc.

2017-10-05

2017-12-18
2018-01-09
2018-04-01
2018-05-02

Sony Bank relocated its headquarter in Chiyoda-ku, Tokyo
Sony Life announced revisions to its insurance premium rates on certain tern life insurance products within
individual life insurance, in line with April 2018 revisions to the Standard Mortality Table
Sony Assurance began offering ASV (Advanced Safety Vehicles) discounts for its automobile insurance commencing on or after
Apr. 1, 2018
Sony Life announced sale of new product “Medical Benefit” and “Medical Benefit Return” from July 2, 2018

Sony Financial Holdings Inc. All Rights Reserved38

Attachment

Analysis on Ordinary Profit for Life Insurance Business(JPY bn)

Improvement in gains and losses onderivatives used for hedges related toavailable-for-sale securities

Increase in profit owing to
growing policy amount in force

Gains on sale of securities

54.1

Others

+6.0
+6.0

70.9

+0.8

+4.0

FY2017FY2018(Forecast）

39

Sony Financial Holdings Inc. All Rights ReservedSony Lifeʼs Product Portfolio
Annualized Premiums from New Policies by Product

FY2017 (12M) ¥73.0 billion

FY2016 (12M) ¥78.1 billion

Yen whole
life 6%
Yen
whole
Endowment/ life 14%
Annuities
21%

U.S. dollardenominatedwhole life 8%

U.S. dollardenominated
U.S. dollar- single-premium
Endowment/
denominated whole life 6%
Annuities
whole life 13%
29%

Yen single-premium
whole life 1%
Protection-type（term-life）
56%

Protection-type（term-life）
47％

Sony Financial Holdings Inc. All Rights Reserved40

Attachment

Sony Lifeʼs Asset Management
Purchase Securities in the General Account

FY2016 (12M)

FY2017 (12M)

Japanese local
government
bonds 0.1%

Japanesestocks 0.5%

国債
95.4%

Foreign
bonds
28.3%

Japanesestocks 0.5%

Foreignbonds
18.5%
Japanese
corporate
Japanese
Bonds
30.3%
corporate
Bonds
25.9%

JGBs
42.5%

Japanese
corporate
Bonds
28.6%

JGBs
55.1%

国債
85.3%
Notes:
1. Japanese corporate bonds include FILP agency bonds and Government-guaranteed bonds.
2. The graphs above are asset allocation for the relevant period. Total invested amount for the relevant period as 100%.
(excluding, investment in subsidiaries and affiliates, and strategic investments)

41

Sony Financial Holdings Inc. All Rights ReservedSony Life: Fair Value Information on Securities(General Account Assets)
Fair Value Information on Securities
Fair value information on securities with market value (except trading-purpose securities)
Mar. 16Mar. 17Mar. 18

Fair valueNet
unrealized
gains(losses)

Carrying
amountFair valueNet
unrealized
gains(losses)

Fair valueNet
unrealized
gains(losses)

5,383.9

7,410.1

2,026.2

6,068.6

7,514.2

1,445.5

6,467.9

8,050.6

1,582.6

Policy reserve matching bonds

251.2

292.5

41.3

277.3

303.3

25.9

401.9

436.8

34.8

Available-for-sale securities

887.9

1,091.6

203.6

896.5

1,069.9

173.3

921.9

1,091.1

169.1

Japanese bonds(including JGBs)

854.3

1,040.3

186.0

852.6

1,013.3

160.7

847.0

1,002.1

155.0

Japanese stocks

13.6

25.6

12.0

13.6

27.0

13.3

13.6

30.6

16.9

Foreign securities

19.8

25.2

5.4

30.0

29.1

(0.8)

61.0

58.1

(2.9)

Other securities

0.1

0.3

0.1

0.1

0.3

0.1

0.1

0.2

0.1

6,523.1

8,794.3

2,271.1

7,242.5

8,887.5

1,644.9

7,791.9

9,578.6

1,786.7（JPY bn）
Held-to-maturity securities

Total

Carrying
amountCarrying
amountNote: The above table includes money held in trust other than trading-purpose securities.

Valuation gains (losses) on trading-purpose securities
Mar. 16
Balance sheet
amountNet valuation gains (losses)
recorded in income
2.2（JPY bn）

Mar. 17

0.1

Balance sheet
amountMar. 18

Net valuation gains (losses)
recorded in income
2.0

(0.1)

Sony Financial Holdings Inc. All Rights Reserved

Balance sheet
amountNet valuation gains (losses)
recorded in income
－

(0.0)

42

Attachment

Sony Lifeʼs Interest Income and Dividends (Details)

FY2016（JPY mn）

FY2017

Change00+681.5%

Japanese bonds(including JGBs)

121,103125,271+3.4%

Japanese stocks

527

566

+7.4%

Foreign securities

8,886

13,975+57.3%

Other securities

255

621

+143.6%

Loans

6,377

6,610

+3.7%

Real estate

10,86910,285(5.4%)

265

395+49.0%

148,284

157,727+6.4%

Cash and deposits

OthersTotal

43Sony Financial Holdings Inc. All Rights ReservedSony Lifeʼs Capital Gains/Losses（JPY mn）
Capital losses

FY2016FY201732,27627,357（JPY mn）
Capital gains

Losses on trading securities, net－

8Income from trading securities, net

Losses on sale of securities… (3)－0Gains on sale of securities…(3)30,05011,403

Gains on derivatives, net

15,666

8,424

Foreign exchange gains, net

Losses on derivatives, net
Losses on hedges of variable life insurance…(1)Losses on hedges of available-for-salesecurities… (2)

2,460

4,350

Losses on dollar-denominated insurance…(4)12,010(2,004)－

15,280－15,465

2,226

664

1,560

－

Foreign exchange losses, net
Losses on dollar-denominated insurance（foreign exchange losses in separate
accounting）…(4)Other capital losses
Losses on dollar-denominated insurance（the provision of policy reserves for foreignexchange fluctuations）…(4)FY2016FY2017

16,114

9,894

134

－

1,308

0

－

－

14,670－Gains on dollar-denominated insurance(foreign exchange gains in separate
accounting）…(4)12,389－Gains (losses) on sale of foreign bonds

2,375

－

－

9,894

－

9,894

(16,162)(17,463)

Other capital gains
Gains on dollar-denominated insurance（the reversal of policy reserves for foreignexchange fluctuations）

Net capital gains (losses)

Note: The figures of income (losses) from trading securities, net, gains (losses) on derivatives and foreign exchange gains (losses), net were recorded after offsetting
gains and losses of each item.
FY2016FY2017(1) Gains (Losses）on hedges of variable life insurance(15,666)(8,424)(2) Gains (losses）on hedges of available-for-salesecurities(2,460)(4,350)1,308

0(1,181)(3,566)（JPY mn）(3) Gains (losses) on sale of securities(4) Gains (losses) on dollar-denominatedinsurance（JPY mn）
The total amount of gains (losses) on sale of securities
and gains (losses) on sale of foreign bonds

Sony Financial Holdings Inc. All Rights Reserved

FY2016FY2017

3,683

0

44

Attachment

Sony Lifeʼs Quarterly Trend on New Policy Amount
Quarterly Trend on New Policy Amount(JPY bn)

2,000

1,500

1,842.4

1,324.2 1,290.7

1,457.7

1,437.4
1,260.0
1,098.9

1,189.0

1,115.8 1,114.8

1,050.7

1,214.7

1,000

500

0
FY15.1Q FY15.2Q FY15.3Q FY15.4Q FY16.1Q FY16.2Q FY16.3Q FY16.4Q FY17.1Q FY17.2Q FY17.3Q FY17.4Q

45

Sony Financial Holdings Inc. All Rights ReservedSony Lifeʼs Quarterly Trend on
Annualized Premiums from New Policies
Quarterly Trend on Annualized Premiums from New Policies
Annualized premiums from new policies

Of which, third-sector(JPY bn)

25

22.3

23.9

22.7
20.6

19.1

20

20.5

19.5

18.2
15.3

15

16.1

16.2

3.1

2.8

21.1

10

5
3.9

3.4

4.6

3.6

4.1

3.9

3.1

4.4

0

3.3

3.6

FY15.1Q FY15.2Q FY15.3Q FY15.4Q FY16.1Q FY16.2Q FY16.3Q FY16.4Q FY17.1Q FY17.2Q FY17.3Q FY17.4Q

Sony Financial Holdings Inc. All Rights Reserved

46

Attachment

Operating Performance : AEGON Sony Life Insurance◆AEGON Sony Life Insurance sells individual variable annuities.

Number and Amount of Policies in Force

Number and Amount of New Policies
New policy amount

Number of new polices [ ](JPY bn)80

71.5[11.8]

70.8[14.2](Thousandsof policies)

Policy amount in force(JPY bn)600

50.2[10.6]

1560
10

Number of policies in force [ ]444.2[73.4]

501.7[85.9]

520.6[92.5](Thousandsof policies)

120

400

80

200

40

40
5

20

0

0

0

0

FY2015FY2016FY2017
Net income (losses) for AEGON Sony Life Insurance and SA Reinsurance(JPY bn)
FY2016FY2017
ChangeAEGON Sony Life Insurance

(4.4)

(4.3)

+0.1

SA Reinsurance

(2.6)

(0.5)

+2.0

Mar. 16Mar. 17Mar. 18

AEGON Sony Life Insurance and SA Reinsurance are equity method companies, 50-50 joint venture established by Sony Life and AEGON Group.
SA Reinsurance prepares its financial statements in accordance with U.S. GAAP. 50% of the net income (losses) for AEGON Sony Life Insurance andSA Reinsurance are recognized as investment profit (losses) on equity method in the SFHʼs consolidated net income.

Sony Financial Holdings Inc. All Rights Reserved

47

Revision in Sony Lifeʼs Method of Measuring Insurance Risk
and othersAbout the method measuring insurance risk
 From the time it began disclosing MCEV up until the present, from the perspective of transparency
and comparability Sony Life has employed a measurement method based on the EU Solvency II
standard, which is a leader in capital requirements based on economic value.
 During this time, the industry has deliberated risk measurement methods and internal models. Also,Sony Life has accumulated its own experiential data related to insurance risk, as well as knowledge
about this risk in relation to its internal model. As a result, the internal model has grown moresophisticated.
 For these reasons, as of March 31, 2018, Sony Life changed its method of measuring insurance risk
to employ an internal model that reflects the companyʼs own risk characteristics.

About the cost of capital rate
 We have set a cost of capital rate conforming to an MCEV framework that takes market data into
consideration. Taking the status of recent market data and trends into consideration, as of March 31,
2018, we revised the cost of capital rate for measuring MCEV as of March 31, 2018 (increasing therate from 2.5% to 3.0%).
The following page shows the impact of these changes on MCEV and ESR and others as of March 31, 2018.
Sony Financial Holdings Inc. All Rights Reserved48

Attachment

Amount of Impact led by Revision in Sony Lifeʼs Method of
Measuring Insurance Risk and others
March 31, 2018

(JPY bn)

Before revision

MCEV

The amount of
impactAfter revision

1,536.5

1,633.2+96.6

Insurance risk

987.9

497.5

(490.4)Market-related risk

380.6

380.6

ー

Operational risk

31.0

31.0

ー

Counter party risk

2.6

2.6

ー

(397.1)(182.0)+215.1

The risk amount based on
economic value

1,005.0729.7(275.3)

MCEV + Frictional costs

1,569.3

1,655.8

+86.5

156%

227%

+71pt

Variance effect

ESR Of the MCEV impact of +¥96.6 billion, changes in capital cost rates had an impact on MCEV ofnegative ¥53.0 billion.
 New business value reflects such factors as a revision in the insurance risk measurement method
and others from FY2018.The impact on the new business margin for new policies in FY2017 if therevised insurance risk measurement method were reflected would be +0.7 pt.
49

Sony Financial Holdings Inc. All Rights Reserved

Trend on JGB Yields (Par rate)
1.20%

10 year
20 year

1.00%

30 year
40 year

0.80%

0.60%

0.40%

0.20%

0.00%
Mar. 17 Apr. 17 May. 17 Jun. 17 Jul. 17

Aug.17 Sep.17

Oct.17

Nov.17 Dec.17

Jan.18Feb.18 Mar. 18

As of the end of each month
10 year
20 year
30 year
40 yearMar.17 Apr.17 May.17 Jun.17
0.07%
0.02%
0.05%
0.09%
0.64%
0.56%
0.58%
0.59%
0.84%
0.78%
0.80%
0.84%
0.96%
0.92%
0.95%
1.02%

Jul.17Aug.17 Sep.17 Oct.17 Nov.17 Dec.17 Jan.18
Feb.18 Mar.18
0.08%
0.01%
0.06%
0.07%
0.04%
0.05%
0.09%
0.05%
0.04%
0.59%
0.55%
0.58%
0.60%
0.58%
0.57%
0.59%
0.55%
0.53%
0.87%
0.82%
0.86%
0.86%
0.82%
0.81%
0.81%
0.76%
0.74%
1.07%
1.02%
1.06%
1.06%
1.00%
0.97%
0.96%
0.90%
0.89%

Sony Financial Holdings Inc. All Rights Reserved50

Attachment

Trend on Risk-free Rate (Japanese yen/ Par rate)
2.00%

Convergence
period:20 year

Mar.
17
17.3末

1.50%

17.12末Dec. 17
18.3末Mar. 18

1.00%

0.50%

0.00%

Last liquid point: 40 year
△0.50%(0.50%)

1 1年
year

10
year
10年

2020年
year

30 30年
year

40
year
40年

50
year
50年

70
year
70年

60
year
60年

80
year
80年

*For above risk-free rate, we employ the Smith-Wilson method for extrapolation so that the 60-year forward rate will coverage on the UFR (3.5%).

51

Sony Financial Holdings Inc. All Rights Reserved

Definition of Consolidated Adjusted ROE
Calculation of Consolidated Adjusted ROE
Since each company of Sony Financial Group differs by industry such as insurance andbanking, each group company calculate its “Adjusted ROE” based on adjusted profit andadjusted capital to realize its corporate value and capital efficiency.
Sony Financial Group *Sony Life
Core ROEVSony Assurance
Adjusted ROE

Numerator(Adjusted
profit)New business value +Expected existing business
contribution

Denominator(Adjusted
capital)MCEV as of the beginning of
the fiscal year less dividends
paid plus MCEV as of the endof the fiscal year, divided by
two.

＋
①

④

＋

Net income (loss) + Provision
amount for catastrophe
reserve and its provision
amount for reserve for pricefluctuations, in each case②
after taxes

The average amount of net
assets plus the sum ofcatastrophe reserve and its
reserve for price fluctuations
during the fiscal year, in eachcase after taxes⑤

Sony Bank
ROE＋

Profit (loss) attributable toowners of the parent＋

The average amount of net
assets during the fiscal year③⑥

*Consolidated Adjusted ROE = Consolidated Adjusted Profit divided by Consolidated Adjusted Capital
Consolidated Adjusted Profit ＝ ①＋②＋③
Consolidated Adjusted Capital ＝ ④＋⑤＋⑥

Sony Financial Holdings Inc. All Rights Reserved52

Attachment

Contact︓
Investor Relations Department
Sony Financial Holdings Inc.
TEL︓+81-3-5290-6500

Sony Financial Holdings Inc. All Rights Reserved53