Presentation Materials

Consolidated Financial Resultsfor Year Ended March 31, 2009

Sony Financial Holdings Inc.
May 14, 200900

Disclaimers:
These presentation materials contain statements concerning the current plans, expectations, strategies and beliefs of the SonyFinancial Holdings Group (the “SFH Group”). Any statements contained herein that pertain to future operating performance andthat are not historic facts are forward-looking statements. Forward-looking statements may include—but are not limited to—words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,” “forecast,” “predict,” “possibility” and similar words that describe
future operating activities, business performance, events or conditions. Forward-looking statements, whether spoken or written,
are based on judgments made by the management of the SFH Group, based on information that is currently available to it. As
such, these forward-looking statements are subject to various risks and uncertainties, and actual business results may vary
substantially from the forecasts expressed or implied in forward-looking statements. Consequently, investors are cautioned not toplace undue reliance on forward-looking statements. The SFH Group disclaims any obligation to revise forward-looking
statements in light of new information, future events or other findings. The information contained in this presentation does notconstitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe for 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.

1

Disclaimer

1Highlights of Consolidated Operating Performancefor Year Ended March 31, 2009
FY07

FY08

(Billion yen)

Ordinary profit

Ordinary revenues

822.1

+4.6%

860.3
Non-life
insurancebusiness（Billion
yen）

44.5

Life insurance
business

Bankingbusiness-23.0%

34.2

Corporate andelimination

741.3

766.2

+24.9

+3.4%

Ordinary profit

39.0

32.5

-6.5

-16.7%

Ordinary
revenues

55.6

61.8

+6.2

+11.2%

Ordinary profit

2.8

2.1

-0.6

-22.7%

Ordinary
revenues

25.9

33.3

+7.3

+28.5%

Ordinary profit

2.4

-0.5

-2.9

－

Ordinary
revenues

-0.8

-1.1

-0.3

－

Ordinary profit

Consolidated

0.2

0.1

-0.0

-48.0%

Ordinary
revenues

822.1

860.3

+38.1

+4.6%

Ordinary profit

44.5

34.2

-10.2

-23.0%Net income

24.2

30.7

+6.4

+26.7%(Billion yen)

FY07

FY08

Consolidated

vs PY

Ordinary
revenues

08.3.31

09.3.31

vs PY

Total assets

4,977.4

5,313.6+336.2+6.8%

Net assets

261.6

204.8

-56.7

-21.7%

Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

2

During the year ended March 31, 2009, consolidated ordinary revenues
grew 4.6% compared with the previous fiscal year, to ¥860.3 billion, owing
to increases in ordinary revenues from all the businesses: life insurance,
non-life insurance and banking.Consolidated ordinary profit declined ¥10.2
billion year on year to ¥34.2 billion, due to decreases in all thebusinesses.Consolidated net income increased ¥6.4 billion year on year,to ¥30.7 billion, as a reversal of reserve for price fluctuations of ¥20.4
billion was recorded.
We summarize our financial results for the year ended March 31, 2009, as
follows.
In the life insurance business, sales of mainstay death-protection-typeinsurance was mostly strong, although cancellations increased in someproduct categories. In investment activities, we endeavored to reduce
equity assets, while proactively purchasing ultra long-term bonds from theviewpoint of asset liability management. We believe our level of net assets
and solvency margin ratio are sufficient enough.
In the non-life insurance business, net premiums written grew by adouble-digit percentage year on year, driven by strong sales of newpolicies.
In the banking business, despite business expansion, ordinary profit
decreased year on year, due mainly to impairment losses on securities,caused by the financial market turmoil in and after the second half of the
fiscal year ended March 31, 2009.

2

Highlights of Consolidated Operating Performancefor Year Ended March 31, 2009
 In the life insurance business, both new policy amount and policy amount in force (for individual life

insurance and individual annuities) increased. Income from insurance premiums also grew steadily.
However, ordinary profit decreased owing mainly to deteriorations in gains and losses from investments.
In the non-life insurance business, ordinary revenues increased resulting from strong sales ofautomobile insurance policies. Ordinary profit declined, owing mainly to an increase in the amount ofclaims paid. The number of automobile insurance policies in force reached 1 million at the end of
December 2008.

 In the banking business, ordinary revenues expanded as the balance of investment assets rose in linewith business expansion. However, ordinary profit decreased, primarily due to impairment losses onavailable-for-sale securities.
 Consolidated ordinary revenues increased 4.6%, year on year to ¥860.3 billion. Consolidated ordinary

profit decreased ¥10.2 billion, or 23.0%, year on year, to ¥34.2 billion, as net valuation losses onavailable-for-sale securities (or impairment losses) of ¥47.4 billion were recorded. Net income
increased ¥6.4 billion, or 26.7%, year on year, to ¥30.7 billion, due to a reversal of reserve for pricefluctuations.
 Consolidated net assets decreased ¥56.7 billion year on year, to ¥204.8 billion. Consolidated total

assets increased ¥336.2 billion year on year, to ¥5,313.6 billion. Affected by falling share prices,
consolidated net assets fell, as the decrease in net unrealized gains/losses on other securities, net oftaxes, (down by ¥79.7 billion year on year to a negative ¥4.8 billion as of March 31, 2009) exceeded theincrease in retained earnings.
3

Highlights of each business segment are summarized here.

3

Highlights of Operating Performance:
Sony Life (Non-Consolidated)
Ordinary revenues(Billionyen)

Ordinary profit(Billion yen)

+3.3%

765.9

741.2

32.4

Income from insurance premiums

648.4

662.0

+13.6

+2.1%

Investment income

87.4

98.7

+11.2

+12.9%

Interest income and dividends

47.9

55.8

+7.8

+16.5%

Income from monetary trusts

14.7

-

-14.7

-100.0%FY08Sony Life

Ordinary revenues up but ordinary profit down year on year.
New policy amount up 1.9% year on year.
Income from insurance premiums increased owing tosteady growth of policy amount in force.
Core profit amounted to ¥38.0 billion
Lapse & surrender rate was 6.79%, up 0.67pt.
Solvency margin ratio as of Mar. 31, 2009 was 2,060.5%,
up 312.6 percentage points from that of Mar. 31, 2008.
Notes:
1.
Figures for new policy amount, policy amount in force, lapse & surrender rate are
the total of individual life insurance and individual annuities.
2.
The lapse and surrender rate is calculated without offsetting policies that are
reinstated.

Line item amounts are truncated below ¥0.1 billion;
percentage change figures are rounded.

+3.3%+33.7%

24.0

32.1

+8.0

701.9

733.5

+31.5

+4.5%

Insurance claims and otherpayments

241.1

274.7

+33.6

+14.0%

Provision for policy reserve andothers

286.2

219.0

-67.1

-23.5%

Investment expenses

69.8

133.7

+63.8

+91.4%

1.5

16.1

+14.5

+933.5%

Devaluation losses on
securities

6.6

31.8

+25.2

+376.3%Losses on separate accounts

48.3

72.2

+23.8

+49.5%

94.3

93.9

-0.4

-0.5%

39.2

32.4

-6.8

-17.5%+15.2+82.5%

Losses on sale of securities

FY07

vs PY
+24.6

Gains on sale of securities-17.5%

FY08
765.9

Ordinary expenses

39.2

FY07
741.2

Ordinary revenues

Operating expenses

Ordinary profit

18.5

Net income(Billion yen)

08.3.3133.7
09.3.31

Change from 08.3.31

Securities

2,388.9

2,819.6+430.7

Policy reserve

3,375.0

3,592.3+217.2+6.4%

Total net assets

182.6

140.7

-41.9

-23.0%-95.1%Net unrealized gains/ losses onother securities

Total assets
Separate account assets+18.0%

82.7

4.0

-78.7

3,659.7

3,810.9+151.1

+4.1%

321.7

275.1

-46.6

-14.5%

4Highlights of Sony Life’s operating performance (non-consolidated basis) are
shown here.
Sony Life’s ordinary revenues increased 3.3% year on year, to ¥765.9 billion,
owing to a higher income from insurance premiums associated with a steadyincrease in policy amount in force.
Ordinary profit decreased 17.5% year on year, to ¥32.4 billion, due toincreased investment expenses, associated with a significant fall in Japanesestock market prices. The contingency reserve was partially reversed in
response to lower investment yields associated with financial market
deterioration.
Net income increased 82.5% year on year, to ¥33.7 billion, as the reserve forprice fluctuations was partially reversed in response to losses resulting fromtrading or reevaluation of stocks and other securities.

4Overview of Performance:
Sony Life (Non-Consolidated)(Billion yen)

FY07
New policy amount*1

FY08

Change3,802.5

3,873.7

+1.9%

63.4

61.6

-2.8%

Annualized premiums fromnew policies*1
Of which, third sector
products

13.3

13.4

+0.6%

Income from insurance premiums

648.4

662.0

+2.1%

Investment income (loss), net

17.5

-34.9

-

Core profit

23.5

38.0

+61.2%-20.2%

26.7

21.3

Average assumed interest rate

2.68%

2.59%

-0.09pt

Lapse & surrender rate*1,*2

6.12%

6.79%

+0.67pt

Negative spread

08.3.31
Policy amount in force*1
Annualized premiums from insurance in force*1
Of which, third sector
products
Solvency margin ratio
Adjusted net assets

Changefrom
08.3.31

09.3.31

31,497.3

32,517.6

+3.2%

530.0

547.8

+3.4%

122.8

126.6

+3.1%

1,747.9%

2,060.5%+312.6pt

612.0

532.6

-13.0%

Line item amounts are truncated below ¥100 million; percentage change figures are rounded.
Notes:*1 Each figure of new policy amount, annualized premiums from new policies, lapse and surrender rate, policy amount in force and annualized premiums from insurance in force is calculated
as the total of individual life insurance and individual annuities.
*2 The lapse and surrender rate is calculated without offsetting policies that are reinstated.

5

Overview of Sony Life’s performance is shown here.

5Sony Life Operating Performance (1)New Policy Amount

Annualized Premiums from New Policies(Individual Life Insurance + Individual Annuities)(Individual Life Insurance + Individual Annuities)(Trillionsof yen)

New policy amount

Number of new policies

+1.8%

5

517

512
4

524

(Thousandpolicies)

534

600

3.87

500

(Billionsof yen)70

Annualized premiums income from new policies
Of which, third sector
65.5
63.4 -2.8%
61.6
61.7

60

3.80
3.39

3.42

50

+1.9%

400

3

40
300

30

2
200

20
1

100

0

0
FY05

FY06

FY07

FY08

Line item amounts are truncated below ¥10 billion; numbers of policies aretruncated below 1,000 policies; percentage change figures are rounded.

10

14.5

14.4

13.3

FY05

FY06

FY07

+0.6%

13.4

0
FY08

Line item amounts are truncated below ¥100 million. Percentage figures are rounded.

6(Left-hand graph)
New policy amount for the total of individual life insurance and individual
annuities increased 1.9% from the previous fiscal year, to ¥3,873.7 billion. The
number of new policies rose 1.8% year on year to 0.53 million policies.
(Right-hand graph)
Annualized premiums from new policies decreased 2.8% year on year, to ¥61.6
billion. Of this amount, the figure for third-sector products was ¥13.4 billion, up
0.6% year on year.
The primary reason of decline in annualized premiums from new policies, despitea growth in new policy amount, was a decline in annualized premiums fromvariable life insurance policies.

6Sony Life Operating Performance (2)Policy Amount in Force

Annualized Premiums from Insurance in Force(Individual Life Insurance + Individual Annuities)(Individual Life Insurance + Individual Annuities)（Trillionsof yen）(Millionpolicies) (Billions of yen)

Policy amount in force

Number of policies in force
Annualized premiums from insurance in force

40

+6.1%

4.70

5
600

4.43
3.84
30

29.0

Of which, third sector

4.14
30.2

504.6

31.4 +3.2%

32.5

4

3
20

500

+3.4%

547.8

530.0

474.2

400

300

2
200

10
1

0

0
06.3.3107.3.3108.3.31

09.3.31

Line item amounts are truncated below ¥100 billion; numbers of policies aretruncated below 10,000 policies; percentage change figures are rounded.

+3.1%

100

109.4

117.4

122.8

126.6

06.3.3107.3.3108.3.31

09.3.310Line item amounts are truncated below ¥100 million.
Percentage figures are rounded

7(Left-hand graph)
Policy amount in force for the total of individual life insurance and individual
annuities grew steadily, to ¥32,517.6 billion as of March 31, 2009, up 3.2%
from March 31, 2008. The number of total policies grew 6.1% year on year
to 4.7 million policies.
(Right-hand graph)
Annualized premiums from total policies as of March 31, 2009, were up
3.4% from March 31, 2008, totaling ¥547.8 billion. Of this amount, thefigure for third-sector products was up 3.1% from March 31, 2008, to¥126.6 billion.

7

Sony Life Operating Performance (3)Lapse and Surrender Amount*

Lapse and Surrender Rate*（Individual Life Insurance + Individual Annuities）（Individual Life Insurance + Individual Annuities）（Trillionsof yen）

3+12.3%

2.5(Thousandpolicies)

Lapse & surrender amount
Number of lapse & surrender

230

223

264

235

Lapse & surrender rate (Based on number of lapse & surrender)

250

8+15.4%

200

1.84
1.62

+0.67pt

6.48

1.68

5.82

6

1.5

150

100

0.5

50

2

0

0

0
FY06

FY07

FY08

6.79

6.12

5.84

5.79

5.68

FY05

FY06

FY07

+0.28pt

5.96

4

1

FY05

Lapse & surrender rate (based on policy amount)

10

2.13
2

（％）

300

FY08

Line item amounts are truncated below ¥10 billion; numbers of policies aretruncated below 1,000 policies; percentage change figures are rounded.
*Each of lapse and surrender amount, number of lapse and surrender, and lapse andsurrender rate is calculated without offsetting policies that are reinstated.

8

The left-hand graph shows the lapse and surrender amount and thenumber of lapse and surrender policies while the right-hand graph shows
the lapse and surrender rate.
The lapse and surrender rate rose 0.67 percentage point from the previous
fiscal year, to 6.79%.
The main reasons for the rise were an increase in cancellations of term life
insurance by corporate customers, as well as cancellations of variable life
insurance policies by individual customers. We believe that thesecancellations stemmed from the economic downturn and deterioration in
the investment environment.

8

Sony Life Operating Performance (4)Ordinary Profit & Core Profit(Non-Consolidated)

Income from Insurance Premiums(Billionsof yen)(Billionsof yen)

700
600

662.0

648.4
580.5

Core profit

Ordinary profit

39.2

40

38.0

-17.5%

605.5

32.4

+2.1%

30

28.5

+61.2%

500

24.3

24.3

23.5

400

20

14.8

300
200

10

100
0

0
FY05

FY06

FY07

Line item amounts are truncated below ¥100 million.
Percentage figures are rounded

FY08

FY05

FY06

FY07

FY08

Line item amounts are truncated below ¥100 million.
Percentage figures are rounded

9(Left-hand graph)
Income from insurance premiums grew 2.1% from the previous fiscal year,to ¥662.0 billion, associated with a higher policy amount in force.
(Right-hand graph)
Compared to the previous fiscal year, core profit rose while ordinary profit
declined.
Core profit rose 61.2% year on year, to ¥38.0 billion, mainly as a result of
an increase in income from insurance premiums associated with a higher
policy amount in force and higher interest income and dividends due toinvestment in ultra long-term bonds.
Ordinary profit, on the other hand, decreased 17.5% year on year, to ¥32.4
billion.

9

Sony Life Operating Performance (5)Changes in Ordinary Profit and Core Profit (FY07 vs FY08）(Billion yen)
+0.4
0.4

*1: Other one- time gains*2: Other one-time losses

+20.3
+20.3

*3

53.
53.1

Provision Provision for*3: Reversal of reserve for policyholders’ dividends
for reserve contingency
for price reserves, etc. *1 Capital
gains
Provision for fluctuation,+1.
+1.6
Capitalreserve for
-2.7
etc.
lossespolicyholder
Reversal of
+16.
+16.8
-3.4
39.
39.2
s’ dividends
contingency
38.
38.0
-3.1
reserves

+14.4
14.4

32.
32.7

+16.
+16.3

23.
23.5

-21.
21.7

32.
32.4

Reversal ofreserve forpricefluctuations,
etc.

*2
-0.1

FY07
Incomebeforeincome taxes

Ordinary
profitFY08
Core
profitCore
profitLine item amounts are truncated below ¥100 million.

Ordinary
profitIncomebeforeincome taxes

10

Changes in ordinary profit and core profit from the previous fiscal year are
shown in the graph here.
For the year ended March 31, 2009, although core profit increased, losses
from investments in the general account had a negative effect, and thecontingency reserve was partially reversed.
As a result ordinary profit for the year ended March 31, 2009, dropped ¥6.8
billion year on year.

10Sony Life Operating Performance (6)Average
Average Assumed
Assumed Interest
Interest Rate,
Rate,
Investment Yield
Investment
Yield forfor CoreCore Profit
Profit andandInvestment Yield
Yield inin General
General AccountInvestment
Account

Negative Spread
4.00%

Average assumed interest rate
Investment yield in general account(Billionsof yen)Investment yield for core profit

40

37.3

3.00%

2.92%
2.77%

33.1
30

26.7

2.22%

2.68%

2.59%

2.17%
2.02%

-20.2%

2.00%

21.3

1.90%

20

1.73%
1.45%
1.31%

1.00%

1.11%

10

0

0.00%

FY05

FY06

FY07

FY08

FY05

FY06

FY07

FY08

Line item amounts are truncated below ¥100 million.
Percentage figures are rounded

11(Left-hand graph)
In line with an increase in interest and dividend income, negative spreadnarrowed 20.2% year on year to ¥21.3 billion.
(Right-hand graph)
Investment yield for core profit was 1.90%,
Investment yield in the general account was 1.11%, andthe average assumed interest rate was 2.59%
The significant decline in investment yield in the general account, which
was 1.11% for the year ended March 31, 2009, was due to impairment
losses on securities held.

11Sony Life Operating Performance (7)Number of Lifeplanner Sales Employees

Number of Independent Agents（agents）（persons）

3,000

2,264

2,186

2,151 -392,112

07.3.3108.3.31

09.3.31

2,000

4,000
3,825

3,776

+112
3,779

3,891

1,000

0
3,000

0
06.3.3107.3.3108.3.31

09.3.3106.3.31

12(Left-hand graph)
The number of Lifeplanner sales employees as of March 31, 2009, was
3,891, up 112 persons year on year.
(Right-hand graph)
The number of independent agents decreased 39 year on year to 2,112.

12

Sony Life Operating Performance (8)Breakdown of General Account Assets
Fiscal 2008 Asset Management Review
Asset

Japanesegovernment andcorporate bonds
Japanese stocks

51.6%•Japanese government and corporate bonds: Accumulated ultralong-termbonds to be held to maturity. Decreased remainder of convertible bonds
through sale and redemption.
•Stocks: Decreased through stock price declines and sales.

67.4%

Foreign governmentand corporate bonds
Foreign stocks•Foreign securities: Decreased through sales of U.S. and other securities.
All foreign stocks were sold.
•Alternative investments: Real estate and private equity fund investment
was nearly flat.
Profit/Loss

5.2%
4.6%

Monetary trusts

0.7%

26.8%

1.4%
2.7%
0.6%

Policyholder loans•Capital gains/losses (PL): Worsened by further devaluation losses on
securities.
•Gains/losses on other securities (BS): Worsened by further decline in stock
prices.

Real estate
Notes:

17.2%
Cash and call loans

3.3%
2.5%
2.5%
2.9%

3.4%
2.3%
1.6%
3.3%

08.3.31

09.3.31

3,337.9

3,535.7

Total(Billion yen)•Interest and dividend income (PL): Interest and dividend income increased
as a result of the accumulation of ultralong-term bonds.

Japanese stocks and convertible bonds (CBs) in general account assets asof March 31, 2009 were as follows:*Figures in brackets, ( ), are as of March 31, 2008

Japanese stocks: ¥61.3 billion (¥206.2 billion)
Of which, Japanese stocks in monetary trusts: ¥10.4 billion (¥33.3 billion)
Accounting for 1.7% （6.2%） of the total general account assets.
CBs: ¥298.1 billion (¥427.0 billion)
Of which, CBs in monetary trusts: ¥96.8 billion （¥139.4 billion)
Accounting for 8.4% （12.8%） of the total general account assets.

13

A breakdown of Sony Life’s general account assets as of March 31, 2009,
compared with that of March 31, 2008, is shown here.
Japanese stocks, including those in category of “monetary trusts,”
accounted for 1.7% of general account assets as of March 31, 2009, down
6.2% as of March 31, 2008. Convertible bonds, which are included both in
the category “Japanese government and corporate bonds” and in the
category “monetary trusts,” also declined, accounting for 8.4% of generalaccount assets as of March 31, 2009, down from 12.8% as of March 31,
2008.
During the year ended March 31, 2009, Sony Life increased its investment
in ultra long-term bonds for held-to-maturity purpose, while the balance ofequity assets, such as Japanese stocks and convertible bonds, werereduced.
In the current fiscal year, which commenced on April 1, 2009, we will
maintain the policy of increasing our investment in ultra long-term bonds.
Please refer to the appendix for changes in Sony Life’s portfolio.

13

Sony Life Operating Performance (9)Net Unrealized Gains/Losses on Available-for-sale Securities with Market Value（Billion yen)

08.3.3108.6.30

08.9.30

08.12.31

09.3.31

Japanesegovernment andcorporate bonds

83.4

28.6

19.0

58.8

26.9

CBs

9.2

8.4

-19.5

-22.6

-21.2

Japanese stocks

50.8

63.2

24.1

3.3

1.4

Foreign securities

-9.5

-5.8

-12.1

-6.1

-3.6

Other securities

3.0

3.8

1.9

-0.0

-0.5

127.8

89.8

33.0

56.0

24.2

Total

Notes:
1) Line item amounts are truncated below ¥100 million.
2) Amounts above include those categorized in “monetary trusts”.
3) Japanese government and corporate bonds of ¥26.9 billion as of March 31, 2009, do not include unrealized gains on held-to-maturity securities of¥26.8 billion. Foreign securities of -¥3.6 billion do not include unrealized losses on held-to-maturity securities of -¥0.1 billion.
4) As of March 31, 2009, the weighted-average fair value of convertible bonds held by Sony Life was ¥84.9. The average remaining period was 3.6 years(in case Sony Life executes put options, the average remaining period was 2.5 years.)

14

We have disclosed net unrealized gains/losses on available-for-salesecurities with market value on a quarterly basis, starting from March 31,
2008. As of March 31, 2009, net unrealized gains on available-for-salesecurities amounted to ¥24.2 billion, down ¥103.6 billion year on year, due
mainly to decline in Japanese stock market prices.
With respect to equity assets, such as Japanese stocks, Sony Life cancelled
its stock-related derivative transactions for hedging purposes as of March
31, 2009, while closely monitoring market conditions.
In the statements of income, gains of ¥8.9 billion were recorded from thestock-related derivative transactions which Sony Life started during thethree months ended December 31, 2008.
Impairment losses for the year March 31, 2009, totaled to ¥44.9 billion.

14

Sony Life Operating Performance (10)Solvency Margin Ratio

Adjusted Net Assets（％）(Billions of yen)

700

2,500

645.5
614.9

2,060.5+312.6ｐｔ

2,000

1,852.0

612.0-13.0%

600

532.6

1,747.9500

1,547.0
1,500

400

300

1,000

200
500
100

0

0
06.3.3107.3.3108.3.31

09.3.3106.3.3107.3.3108.3.31

09.3.31

Line item amounts are truncated below ¥100 million.
Percentage figures are rounded.

15(Left-hand graph)
The solvency margin ratio is one index of a life insurance company’s
financial soundness. As of March 31, 2009, Sony Life’s solvency margin
ratio was 2,060.5%, up 312.6 percentage points from March 31, 2008.
Net unrealized gains on other securities, an item included in the solvency
margin calculation, decreased owing to a decline in stock market prices.
However, Sony Life’s reduction of equity assets and investment in ultra
long-term bonds substantially reduced investment risk. As a result, thesolvency margin ratio rose year on year.
For more details, please refer to the material in appendix.
(Right-hand graph)
Right-hand graph shows adjusted net assets.
Sony Life will continue to work on maintaining its sound financial base.
Lastly, Sony Life plans to announce its MCEV as of March 31, 2009 on
June 1, 2009.

15

Highlights of Operating Performance:
Sony Assurance
Ordinary profit

Ordinary revenues(Billion yen)

FY07

FY08
vs PY

（Billionsof yen）

61.8
55.6+11.2%

Ordinary revenues

55.6

61.8

+6.2

+11.2%

Underwriting income

55.0

61.1

+6.1

+11.1%

Investment income

0.5

0.7

+0.1

+26.5%

Ordinary expenses

2.8-22.7%

FY07

2.1

FY08

Sony AssuranceOrdinary revenues up, but ordinary profit down year on
year
Sales of automobile insurance policies were strong,resulting in ordinary revenues up 11.2% to ¥61.8 billion
Ordinary profit down 22.7% to ¥2.1 billion owing mainly tohigher claims paid
Net loss of ¥1.5 billion was recorded as a result of
extraordinary loss*

52.8

59.7

+6.8

+13.0%

Underwriting expenses

38.9

44.2

+5.2

+13.4%

Investment expenses

0.0

0.1

+0.1

+2,958.1%

Operating, general andadministrative expenses

13.8

15.3

+1.4

+10.6%

Ordinary profit

2.8

2.1

-0.6

-22.7%Net income (loss)

2.1

-1.5

-3.7

－

08.3.31

09.3.31

Underwriting reserves(Billion yen)

42.7

50.7

+8.0

+18.9%

Total net assets

15.3

13.6

-1.7

-11.1%Net unrealized gains/losses onother securities (net of taxes)

Total assets*Disposal of intangible fixed assets (software in progress)

vs PY

-0.0

-0.1

-0.1

－

78.6

86.6

+8.0

+10.2%

Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

16

Highlights of Sony Assurance’s operating performance are shown here.
Ordinary revenues increased 11.2%, compared with the previous fiscal year, to¥61.8 billion, primarily due to strong sales of its automobile insurance.
Ordinary profit decreased 22.7% year on year, to ¥2.1 billion, owing mainly to anincreased amount of claims paid, led by those resulting from natural disasters.
Losses on disposal of software in progress were recorded as extraordinary
losses, resulting in net loss of ¥1.5 billion, compared to net income of ¥2.1 billion
in the previous fiscal year.
For the purpose of enhancing system and operational efficiency, Sony
Assurance began developing new systems in the fiscal year ended March 31,
2007. However, during the year ended March 31, 2009, Sony Assurance decided
to suspend this development and to overhaul its development policy. Accordingly,
some software assets that were previously recorded as intangible fixed assets(software in progress) and for which future use is uncertain were disposed of,resulting in losses on disposal of fixed assets of ¥3.7 billion, which wererecorded as extraordinary losses.
Although Sony Assurance has suspended new system development, Sony
Assurance has upgraded current systems as is necessary for products, services
and other strategic purposes. Therefore, the suspension of new systemdevelopment has no impact on the company from an operational standpoint.

16

Overview of Performance: Sony Assurance(Billion yen)
FY07

FY08

ChangeDirect premiums written

54.6

60.8

+11.4%Net premiums written

55.0

61.1

+11.1%Net losses paid

26.2

29.9

+14.2%

Underwriting profit

2.2

1.6

-26.9%Net loss ratio

53.5%

55.0%

+1.5ptNet expense ratio

26.7%

26.7%

±0.0ptCombined ratio

80.3%

81.7%

+1.4pt08.3.31
Number of policies in force
Solvency margin ratio

09.3.31

Change1.02 million policies

1.15 million policies+0.12 million policies

1,073.9%993.0%-80.9pt+12.6%Net expense ratio is equal to the ratio of total underwriting costs to net premiums written
Net loss ratio is equal to the ratio of net losses paid and loss adjustment expenses to net premiums written.
The number of policies in force is the total of automobile insurance and medical and cancer insurance, which accounts for more than 99% of net premiums written.
These numbers are truncated below 10,000 policies.
Line item amounts are truncated below ¥100 million. Percentage figures are rounded.

17

Overview of Sony Assurance’s performance is shown here.
Please see the next slide which shows direct premiums written, net
premiums writtenand net claims paid by type.

17

Sony Assurance’s Performance of Underwritingby type of policy
Direct premiums written（Million Yen）

FY07

Change

FY08

Fire

273

379

+38.6%

Marine－－－Personal accident

6,315

6,653

+5.4%

Voluntary automobile

48,05353,835+12.0%－－－

54,64260,868+11.4%

Compulsory automobile
liability
Total

Net premiums written

Net losses paid

（Million Yen）

FY07

Change

FY08

Fire

16

18

+15.7%

Marine52

41-21.6%

Personal accident

6,501

6,932

+6.6%

Voluntary automobile

47,84553,619+12.1%

Compulsory
automobile liability

585

493

-15.7%

55,001

61,106+11.1%

Total（Million Yen）

FY07

Change

FY08

Fire

0

0

-34.6%

Marine2512-49.7%

Personal accident

1,205

1,368

+13.5%

Voluntary automobile

24,54628,088+14.4%

Compulsory automobile
liability

447

484

+8.1%

Total

26,22529,952+14.2%
Line item amounts are truncated below ¥1 million. Percentage figures are rounded.

18

18

Sony Assurance Operating Performance (1)Net Premiums Written andNumber of Policies in Force(Millions of policies)(Billions of yen)

80

Ordinary Profit (losses)

Other
Personal accident insurance
Voluntary automobile insurance
Number of policies in force

1.02

70

0.82

50

45.2

+12.6%

4

1
0.9

55.0
50.4

1.2
1.1

61.1

0.93

60

(Billions of yen)

1.15

2.8

3

0.8

+11.1%

0.6

40

2.1

2.0

0.7

-22.7%

2

0.5
30

0.4
0.3

20

1

0.2

10

0.1

-0.7
0

0

0
FY05

FY06

FY07

FY05

FY06

FY07

FY08

FY08

The number of policies in force is the total of automobile insurance and medical
and cancer insurance, which accounts for more than 99% of net premiums written.
Most personal accident insurance is medical and cancer insurance.
Line item amounts are truncated below ¥100 million for net premiums written andtruncated below 10,000 for the number of policies in force.

-1Line item amounts are truncated below ¥1 million. Percentage figures are rounded.

19(Left-hand graph)
Number of policies in force for the total of automobile insurance andmedical and cancer insurance increased 12.6% year on year, to 1.15
million policies.
Net premiums written posted 11.1% year-on-year increase to ¥61.1 billion.
The number of automobile insurance policies in force reached 1 million, as
of December 31, 2008, which was nine years and three months after thesales of automobile insurance commenced.
(Right-hand graph)
Ordinary profit declined 22.7% year on year to ¥2.1 billion, as explained
before.

19

Sony Assurance Operating Performance (2)< Reference>

Combined Ratio(Net expense ratio + Net loss ratio)

Net expense ratio + Earned/Incurred loss ratio
Net expense ratio

（%）

100

94.9

（%）

Earned/incurred loss ratio

100
89.9

89.0 +1.2pt

82.5

79.9

80.3 +1.4pt 81.7

53.6

53.5

26.3

26.7

FY06

FY07

80

64.6

+1.2pt

63.6

63.5

62.3

60

52.3

+1.5pt

55.0

40

40

20

Net loss ratio

90.2

80

60

Net expense ratio

20±0.0pt

30.3
26.3

26.7

26.7

FY06

FY07

FY08

0

30.3

±0.0pt

26.7

0
FY05

FY05

FY08

Net expense ratio is equal to the ratio of total underwriting costs to net premiums written.
Earned/Incurred loss ratio is equal to the ratio of the sum of net losses paid, loss adjustment expenses
and accumulation in provision for reserve for outstanding losses to earned premium.
*Note that earthquake insurance and compulsory automobile liability insurance are excluded fromthe above calculation.

Net expense ratio is equal to the ratio of total underwriting costs to net premiums written.
Net loss ratio is equal to the ratio of net losses paid and loss adjustment expenses to net
premiums written.

20(Left-hand graph)
To help you understand the actual condition of Sony Assurance, which is in a
growth phase, we show the combined ratio calculated using theearned/incurred loss ratio rather than the net loss ratio. For the year ended
March 31, 2009, the earned/incurred loss ratio rose 1.2 percentage points fromthe previous fiscal year. Excluding the 0.7-percentage-point impact of natural
disasters in the year ended March 31, 2009, the earned/incurred loss ratio forthe year ended March 31, 2009, was 62.8%. Furthermore, excluding the 0.7percentage-point impact of changes in the calculation of reserves foroutstanding claims relating to personal accident insurance during the previous
fiscal year, the earned/incurred loss ratio in the year ended March 31, 2009,
was down approximately 0.1% year on year.
Therefore, there was no upward trend in the earned/incurred loss ratio during
the fiscal years ended March 31, 2007, 2008, and 2009, if the impact of natural
disasters is excluded.
The net expense ratio remained flat year on year, at 26.7%.
(Right-hand graph)
The net loss ratio rose 1.5 percentage points, compared with the previous fiscal
year, to 55.0%, as influenced mainly by natural disasters.
As a result, the combined ratio (the sum of the net loss ratio and the net
expense ratio) rose 1.4 percentage points year on year, to 81.7%.

20

Sony Assurance Operating Performance (3)Solvency margin ratio
（％）

1,500

1,073.9
1,000

976.1

1,009.7

993.0-80.9pt

500

006.3.3107.3.3108.3.31

09.3.31

21

As of March 31, 2009, Sony Assurance’s solvency margin ratio was
993.0%, down 80.9 percentage points from March 31, 2008. Sony
Assurance has maintained a sound financial base.

21

Highlights of Operating Performance:
Sony Bank (Non-Consolidated)（Billion yen）
Ordinary revenues（Billionof yen）+28.4%

33.3

25.9-84.9%
2.7
FY07

FY07

FY08

Ordinary profit

0.4

vs PY

Ordinary revenues

25.9

33.3

+7.3

Gross operating profit

10.9

10.8

-0.0

+28.4%-0.8%

Net interest income

5.1

6.6

+1.5

+30.2%Net fees and commissions

0.3

0.3

-0.0

-21.3%Net other operating income

5.4

3.9

-1.5

-28.3%

General and administrative
expenses

8.1

10.3

+2.1

+26.6%

Ordinary profit

2.7

0.4

-2.3

-84.9%Net income (loss)

4.4

-0.7

-5.2

－

FY08

Sony Bank
Ordinary revenues up but ordinary profit down year
on yearOrdinary revenues up due to higher interest income
as investment assets increased in line with businessexpansion
Ordinary profit decreased as impairment losses onavailable-for-sale securities was recorded due todecline in the fiscal year-end market value of
securities
Net loss was recorded caused by an increased
income taxes (deferred) by applying to the tax effectaccountingCustomer assets increased ¥156.2 billion year on
year to ¥1,403.6 billion.

Securities（
億（Billion yen）
円）

08.3.31

09.3.31

vs PY

488.7

823.1

+334.3+68.4%

Loans

347.0

477.0

+130.0+37.5%

Deposits

1,144.3

1,326.3+181.9+15.9%Net assets

35.7

46.2

+10.5

+29.5%Net unrealized gains/losses onother securities (net of taxes)

Total assets

-9.0

-9.6

-0.6

-

1,211.0

1,411.9+200.9+16.6%

Line item amounts are truncated below ¥100 million. Percentage figures are rounded.

22

Highlights of Sony Bank’s operating performance (non-consolidated basis)are shown here.
Sony Bank’s ordinary revenues increased 28.4% compared with theprevious fiscal year, to ¥33.3 billion, as a higher balance of investment
assets in line with the bank’s business expansion led to an increase mainly
in interest income.
Ordinary profit decreased 84.9% compared with the previous fiscal year, to¥0.4 billion, primarily due to impairment losses on securities, caused bydeteriorated market environment.
A net loss of ¥0.7 billion was recorded due to the decrease in ordinary profit
as well as an increase in income taxes (deferred).

22

Overview of Performance:
Sony Bank (Non-Consolidated)（Billion yen）

FY07

FY08

Gross operating profit

vs PY

10.9

10.8

-0.0

-0.8%

Net interest income

5.1

6.6

+1.5

+30.2%Net fees and commissions

0.3

0.3

-0.0

-21.3%Net other operating income

5.4

3.9

-1.5

-28.3%

2.8

0.5

-2.2

-81.3%Net operating profit

Change from 08.3.31

09.3.3108.3.31

Amount/Number

Customer assets（Billion yen）%

1,247.3

1,403.6+156.2

Deposits

1,144.3

1,326.3+181.9+15.9%

Yen

892.6

1,044.2+151.5+17.0%

Foreign currency

251.7

282.1

+30.3

+12.1%

102.9

77.2

-25.6

-24.9%

347.0

477.0

+130.0+37.5%

338.8

468.3

+129.4+38.2%

8.1

8.7

+0.5

+7.3%

(thousand)

610

723

+113

+18.6%

Capital adequacy ratio* (domestic criteria)

9.15%

13.37%

Investment trusts
Loans
Mortgage loans
Other
Number of accounts+12.5%+ 4.22pt* Sony Bank’s non-consolidated capital adequacy ratio was calculated based on the standard stipulated by Article 14-2 of the Banking Law of Japan, in accordance with the Financial
Services Agency of Japan (“FSA”) public ministerial announcement No. 19 of 2006. The capital adequacy ratio as of March 31, 2009, newly adopted the special exception of the standard
mentioned above, in accordance with the FSA public ministerial announcement No. 79 of 2008.

Line item amounts are truncated below ¥100 million. Percentage figures are rounded.

23

Overview of Sony Bank’s performance is shown here.

23Sony Bank Operating Performance (1)Customer Assets (Deposits + Investment Trusts)
and Number of Accounts(Billion yen)

1,500

Yen deposits
Foreign currency deposits
Investment trusts
Number of accounts (thousand)

610
491

723

Loans

(Billions of yen)Mortgage loans

Other
477.0

500

1,403.6

Other¥8.7
billionInvestment
trusts:¥77.2 billion

1,247.3

430

400

347.0
1,000

Foreign300
currency
deposits:¥282.1 billion

848.8

Mortgageloans¥468.3billion

284.7
239.4

675.1
200

Yen
deposits:¥1,044.2 billion

500

100

0

0

06.3.3106.3.3107.3.3108.3.3107.3.3108.3.31

09.3.31

09.3.31

Amounts are truncated below ¥100 million; numbers of accounts are truncatedbelow 1 thousand.

Amounts are truncated below ¥100 million.

24(Left-hand graph)
As of March 31, 2009, customer assets (the sum of deposits andinvestment trusts) grew 12.5%, from March 31, 2008, to ¥1,403.6 billion,
primarily due to an increase in yen deposits. As for the breakdown ofcustomer assets as of March 31, 2009, deposits amounted to ¥1,326.3
billion, up 15.9% year on year. Investment trusts were ¥77.2 billion, down
24.9% from March 31, 2008. As of March 31, 2009, the number ofaccounts was up 113 thousand from March 31, 2008, to 723 thousandaccounts.
(Right-hand graph)
Loans expanded steadily to ¥477.0 billion, up 37.5%, from March 31, 2008.
The majority of loans accounted for mortgage loans, which grew steadily
as the graph shows, totaling ¥468.3 billion, up 38.2%.

24

Sony Bank Operating Performance (2)Balance of Securities by Credit Ratings

Balance of Securities(Billion yen)(Billion yen)

1,000

Other
Foreign bonds
Japanese stocks
Japanese corporate bonds
Japanese government bonds

900

1,000

800

800

700

700

AA

A

BBB

Other

823.1

600

600

488.7
500

AAA

900

823.1

500

449.5
381.2

400

381.2

400

300

300

200

200

100

100

488.7

449.5

0

0
06.3.3107.3.3108.3.31

09.3.3106.3.3107.3.3108.3.31

09.3.31

Amounts are truncated below ¥100 million.

25(Left-hand graph)
Investments in marketable securities include investments that are subject
to interest rate risk, chiefly Japanese government bonds, and investmentsthat are subject to credit risk, mainly investment-grade corporate bonds. Asof March 31, 2009, the balance of securities increased 68.4% year on yearto ¥823.1 billion.
(Right-hand graph)
The right-hand graph shows the breakdown of securities by credit ratings.
Sony Bank invests in highly rated bonds, mainly those rated AAA

25

Sony Bank Operating Performance (3)Gross Operating Profit, General and
Administrative Expenses, Ordinary Profit(Billion
yen)

10.9

11
10

（％）

Ordinary profit
Gross operating profit
General and administrative expenses

12

20

10.8

9.4
9.0

Non-consolidated Capital Adequacy Ratio(Domestic Criteria)

10.3

15

13.37

9
11.49

8

8.1
7.6

7

10

7.0

9.24

9.15

6
5

5

4
3

2.7
2.2

2

0

1.3

06.3.31

1

0.4

0
FY05

FY06

Amounts are truncated below ¥100 million.

FY07

FY08

07.3.3108.3.31

09.3.31※During the year ended March 31, 2009, Sony Bank raised its capital by ¥120.0
billion by allocating its shares to Sony Financial Holdings.
* Sony Bank’s non-consolidated capital adequacy ratio was calculated based on the standard
stipulated by Article 14-2 of the Banking Law of Japan, in accordance with the Financial
Services Agency of Japan (“FSA”) public ministerial announcement No. 19 of 2006. The
capital adequacy ratio as of March 31, 2009, newly adopted the special exception of thestandard mentioned above, in accordance with the FSA public ministerial announcement No.
79 of 2008.

26(Left-hand graph)
Looking at profitability, gross operating profit dropped ¥0.09 billion from theprevious fiscal year, to ¥10.8 billion, led by a decrease in net otheroperating income, although interest income increased. The increase ininterest income was led by an increase in interest and dividends on
securities and an increase in interest on loans as a result of a higher
balance of investment assets in line with the bank’s business expansion.
The decrease in other operating income was due to impairment losses of¥2.4 billion, caused by decline in market values of securities at fiscal year
end.
(Right-hand graph)
As of March 31, 2009, Sony Bank’s non-consolidated capital adequacy
ratio* (domestic criteria) was 13.37%, up 4.22 percentage points fromMarch 31, 2008. Sony Bank has maintained sound financial base.
The primary reason for the rise was a ¥12.0 billion increase in capitalthrough the allocation of shares to Sony Financial Holdings, and theexclusion of unrealized losses on available-for-sale securities, net of taxes,
in calculating the capital adequacy ratio, employing a special exception to
the standard stipulated by FSA.

26

Consolidated Financial Forecast
for the Year Ending March 31, 2010
(Billions of yen; line item amounts are truncated below ¥100 million; changes are rounded)

FY08

Consolidated ordinary
revenues

FY09.1H

FY09（Forecast）（Forecast）■Life insurance businessChangeFY09 forecast
vs FY08 actual

860.3

437.0

900.0

+4.6%

766.2

392.1

808.7

+5.5%

61.8

65.3

+5.5%

33.3

32.9
12.7

26.1

- 21.8%

Consolidated ordinary profit
Life insurance business
Non-life insurance businessBanking business

34.2

20.0

46.0

+34.3%

32.5

19.8

43.5

+33.7%

2.1

0.4

1.2

- 44.9%

-0.5

0.3

1.3

－

Consolidated net income

30.7

10.0

24.0

- 21.9％Life insurance business
Non-life insurance businessBanking business

Higher ordinary revenues are expected due to an increase of income frominsurance premiums, in line with the steady growth of policy amount inforce. Higher ordinary profit is expected owing to an improvement in gains
and losses from investment.

■Non-life insurance business
Higher ordinary revenues are expected caused by steady businessexpansion, mainly in its mainstay automobile insurance. Lower ordinary
profit is expected due to a rise in the loss ratio and in the expense ratio
resulting from higher system-related expenses.

■Banking business
Lower ordinary revenues are expected, as interest income is expected todecrease, affected by worldwide reductions in interest rates, although thebusiness is expected to expand in line with a growing balance of deposits
and loans. Higher ordinary profit is expected resulting from a growth ingross operating profit due to a decrease in interest expenses.

Consolidated Ordinary Revenues(Billionsof yen)1,000

800

Banking business
Non-life insurance businessLife insurance business
860.3
822.1
759.2

Consolidated Ordinary Profit(Billions of yen)
900.0

50
45

Banking business
Non-life insurance businessLife insurance business
46.0
44.5

40

34.2

35
30

600

25

(Forecast)
Forecast)

400

20(Forecast)
Forecast)

18.3

15
10

200

5
0

0
FY06

FY07

FY08

FY09

-5

FY06

FY07

FY08

FY09

27

Here is the consolidated financial forecast for the fiscal year ending March
31, 2010.
For the year ending March 31, 2010, we expect consolidated ordinary
revenues to grow, backed by the steady business expansion in all thebusinesses.
We expect consolidated ordinary profit to grow stably.
However, net income is expected to decline due to an expected absence ofthe reversal of the reserve for price fluctuations in the life insurance
business, which we experienced in the year ended March 31, 2009.

27

Appendix

28

Appendix28

Sony Life’s Breakdown of Net Assets
Net Assets on BS, Adjusted Net Assets and Solvency Margin
1. Net Assets on BS

2. Adjusted Net Assets

3. Solvency Margin

08.3.31

09.3.3108.3.3108.3.31

Total stockholders’ equity

101.4

138.1

101.4

138.1

Net unrealized gains on othersecurities, net of taxes

82.7

4.0

82.7

4.0

-

-

Net unrealized gains/ losses
on available-for-sale securities

-

-

-

-

116.7

17.6

Land revaluation, net of taxes

-1.4

-1.4

-1.4

-1.4

-

-

Reserve for price fluctuations

-

-

24.0

3.6

24.0

3.6

Contingency reserve

-

-

61.8

45.4

61.8

45.4

Reserve for possible loan
losses

-

-

-

-

0.0

0.0

Net unrealized gains on realestate

-

-

6.8

6.5

5.1

4.8

Excess of the amountequivalent to policy reserve
under Zillmer method

-

-

287.3

302.2

287.3

302.2
0.3

(Billion yen)

09.3.31

Reference

09.3.31

94.4

Unalloted portion of reservefor policyholders’ dividends

-

-

2.3

0.3

2.3

Future profit

-

-

-

-

0.7

131.1

Deferred tax assets

-

-

-

-

11.3

Net unrealized gains/ losses
on held-to-maturity bonds

-

-

-

26.7

-

Deferred tax liabilities foravailable-for-sale securities

-

-

46.9

6.9

-

-

182.6

140.7

612.0

532.6

604.0

531.3

Total

3. After estimated distributed
income deducted

3. Amount before tax X 90%

2. Before tax (Afterrevaluation)
3. Amount before tax (Before
revaluation) X 85%

25.7
2. Before tax

Line item amounts are truncated below ¥100 million.

29

Sony Life’s Breakdown of Net Assets

29Sony Life’s Breakdown of Impairment Losses
Breakdown of Impairment Losses on Securities(Billion yen)
FY07
(full year)
Japanesegovernment andcorporate bonds

FY08.1Q

FY08.2Q

FY08.3Q

FY08.4Q

FY08(full year)

0.1

0.3

0.2

5.0

20.1

25.7

0.1

0.3

0.2

5.0

20.1

25.7

Japanese Stocks

9.7

0.4

2.7

13.7

0.6

17.5

Foreign securities

－

－

0.3

0.5

0.2

1.1

(Foreign
government andcorporate bonds)

－

－

0.3

0.5

0.2

1.1

(Foreign stocks)

－

－

－

－

－

－

Other securities

－

－

－

－

0.3

0.3

Total

9.8

0.7

3.3

19.3

21.4

44.9

(CBs)

Note: Sony Life Insurance Co., Ltd. principally records impairment losses on available-for-sale securities when their fair market values
Line item amounts are truncated below ¥100 million.
as of the end of the accounting period are down by 30% or more from their acquisition cost.

30

Sony Life’s Breakdown of Impairment Losses

30Sony Life’s Portfolio Changes
in General Account Assets (1)Reduced equity assets, including Japanese stocks & CBs for FY08
Japanese Stocks in General AccountCBs in General Account(Billion yen)(Billion yen)

CBs

Japanese stocks

300

Included in "monetary trusts"

427.0

Included in monetary trusts
Reduced to 8.4% of generalaccount assets, as a result ofsale and devaluation, etc.

431.9
399.2

400

367.0

206.2

217.1

Reduced to 1.7% of generalaccount assets, as a resultof sale and devaluation, etc.

200
173.9

298.1

300

200

100

83.9
61.3

100

139.4

141.6

136.7
122.7

33.3

35.9

96.8

28.4

13.7

0
08.3.31

FY08
Impairment
lossesIncluded inmonetary trusts

08.6.30

08.9.30

10.4

08.12.31

009.3.3108.3.3108.6.30

08.9.30

08.12.31

09.3.31

3Q

4Q

1Q

2Q

3Q

4Q

0.4

2.7

13.7

0.6

Impairment
losses

0.3

0.2

5.0

20.1

0.1

Included inmonetary trusts

0.1

－

1.6

6.3

0.0

0.8

3.3

FY08

1Q

2Q

Line item amounts are truncated below ¥100 million. Each of impairment losses is on quarterly basis.

31

Sony Life’s Portfolio Changes in General Account Assets(1)31Sony Life’s Portfolio Changes
in General Account Assets (2)Market Value Information on Securities Reduced equity assets (stocks and convertible bonds) within other securities over the past year. Accumulated
ultralong-term bonds to be held to maturity
 Lengthened average bond duration from 8.7 years to 13.6 years
 Decreased trading-purpose securities(Billion yen)zFair value information on securities with market value (except trading-purpose securities)*
08.6.30

08.3.31
Carrying
value before
mark-tomarket

Category
Held-to-maturity
securities
Available-for-salesecurities
Domestic bonds

CarryingNetvalue before
unrealized
mark-togains/losses
marketFair Value

-

-

-

13.7

Fair Value

08.12.31

08.9.30
CarryingNetvalue before
unrealized
mark-togains/losses
market

14.0

0.2

265.1

Fair Value

CarryingNetvalue before
unrealized
mark-togains/losses
market

268.0

2.9

762.0

09.3.31
CarryingNetvalue before
unrealized
mark-togains/losses
marketFair ValueNet
unrealized
gains/losses

831.6

69.5 1,399.0 1,425.7

26.7
24.2

Fair Value

2,724.9 2,852.8

127.8 2,806.0 2,895.9

89.8 2,605.1 2,638.1

33.0 2,042.7 2,098.7

56.0 1,675.5 1,699.7

2,379.9 2,463.4

83.4 2,462.5 2,491.2

28.6 2,268.5 2,287.5

19.0 1,867.1 1,925.9

58.8 1,546.9 1,573.9

26.9

(CBs)

380.9

390.2

9.2

387.3

395.8

8.4

382.2

362.7

-19.5

359.6

336.9

-22.6

297.7

276.5

-21.2

Domestic stocks

152.9

203.8

50.8

149.9

213.1

63.2

145.4

169.6

24.1

76.6

80.0

3.3

56.9

58.3

1.4

Foreign securities

184.9

175.4

-9.5

186.3

180.5

-5.8

183.7

171.5

-12.1

91.5

85.3

-6.1

64.2

60.5

-3.6

7.1

10.1

3.0

7.1

10.9

3.8

7.4

9.3

1.9

7.4

7.4

-0.0

7.4

6.8

-0.5

125.5 3,074.5 3,125.4

50.9

Other securities
Total

2,724.9 2,852.8

127.8 2,819.7 2,909.9

90.1 2,870.3 2,906.2*Amounts above include those categorized in “monetary trusts”.

zValuation gains/losses of trading-purpose securities
08.3.3108.6.30

08.9.3135.9 2,804.8 2,930.4

08.12.31

09.3.31

BS amount

Net valuation
gains/losses

BS amount

Net valuation
gains/losses

BS amount

Net valuation
gains/losses

BS amount

Net valuation
gains/losses

43.8

-3.0

48.4

-0.0

44.8

-2.4

33.7

-3.1

BS amount

Net valuation
gains/losses

22.8

-4.3

Line item amounts are truncated below ¥100 million.

32

Sony Life’s Portfolio Changes in General Account Assets(2)32Sony Life’s Changes in Solvency Margin Ratio Decreased asset management risk by reducing equity assets and purchasing ultralong-term bonds
to be held to maturity
 Lower net unrealized gains on other securities within total solvency margin resulted from fallingstock prices(Billion yen)
 Reversed provision for reserves in fiscal 2008
Category

08.3.31

Total solvency margin(A)

08.6.30

08.9.30

08.12.31

09.3.31

604.0

597.6

556.4

567.3

531.3

Net assets (less certain items)

94.4

110.9

115.2

126.5

131.1

Reserve for price fluctuaions

24.0

24.5

24.6

16.0

3.6

Contingency reserve

61.8

62.5

63.2

45.0

45.4

Reserve for possible loan losses
Net unrealized gains on other securities (before taxes)
multiplied by 90% if gains or 100% if losses
Net unrealized gains on real estate multiplied by 85%
if gains or 100% if losses
Excess of the amount equivalent to policy reserve
under Zillmer method

0.0

0.0

0.0

0.0

0.0

116.7

83.0

30.4

47.0

17.6

5.1

5.1

5.1

5.2

4.8

287.3

291.9

296.3

299.4

302.2
0.3

Unalloted portion of reserve for policyholders' dividends

2.3

3.2

2.9

3.2

Future profits

0.7

0.7

0.7

0.7

-

Deferred tax assets

11.3

15.3

17.5

23.9

25.7

-

-

-

-

-

-

-

-

-

-

69.1

70.9

66.8

56.8

51.5

17.9

18.1

18.2

18.5

18.5

6.9

7.0

7.0

7.1

7.0

Subordinated debt
Deductible items
Total risk

(R
R
(R
R
R
R
4
1+
8) +
2+
3+
7) +
2

2

Insurance risk
Third-sector insurance risk

R1
R8

(B)

Assumed interest rate risk

R2

11.0

11.1

11.2

11.2

11.2

Asset management risk

R3

45.3

46.8

42.0

30.8

24.6

Business management risk

R4

1.7

1.7

1.7

1.4

1.3

6.1

6.3

6.7

7.0

7.2

1,747.9%

1,685.6%

1,665.4%

1,995.0%

2,060.5%

Minimum guarantee risk

R7

Solvency margin ratio（A)/(1/2×（B))×100

Line item amounts are truncated below ¥100 million.

33

Sony Life’s Changes in Solvency Margin Ratio

33

Sony Life’
Life’s Fundamental Investment Policies for FY09
 Responding to the conversion to solvency margin standards based on MCEV andeconomic value, continue to invest in ultralong-term bonds from an ALM
perspective.
 Invest prudently in equity and alternative assets.

Japanesegovernment andcorporate bondsz Continue purchasing primarily ultralong-term bonds

Stocksz No change from the end of fiscal 2008 (reduction of remaining

zReduce remaining convertible bonds through redemption andsales
balance completed in fiscal 2008)
z Improve portfolio quality by replacing existing holdings forother issues
Foreign securities z Foreign bonds to remain unchangedz No plans to purchase foreign stocks

Alternative
investmentsz Real estate investment to remain unchangedz Private equity fund investments to remain unchanged

34

Sony Life’s Fundamental Investment Policies for FY09

34

Recent Topics
Sony Bank’s Mortgage Loans through Sony Life
Approx. 30% of the amount of new mortgage loans
accounts for the sales through Sony Life
•Sony Life started handling banking agency business in Jan. 2008.

Sony Assurance’s Auto Insurance Sold by Sony Life
Approx. 6% of the new automobile policies accounts
for the sales through Sony Life
*Sony Life started handling automobile insurance in May 2001.
Recent topics
2008-4-23

SFH injected ¥6.0 billion of capital to Sony Bank

2008-5-12Sony Bank started foreign exchange margin transactions

2008-5-23

SFH accepted allocation of shares of Sony Life

2008-8-1

Seven Bank started conducting banking agency business for Sony Bank

2008-10-1

SFH announce to obtain AA- issuer ratings from Rating & Investment Information, Inc. (R&I)

2008-10-2

Sony Life started selling a level premium term life insurance plan and rider with no surrender value

2008-10-14

Sony Bank obtained AA- long-term senior debt rating from Japan Credit Rating Agency, Ltd.

Sony Life opened Beijing representative office

2008-10-29

Sony Bank started handling credit cards with dual-currency settlement function

2008-11-12

SFH injected ¥6.0 billion of capital to Sony Bank

2008-11-28

Sony Life disclosed Market Consistent Embedded Value (MCEV) as of March 31, 2008

2008-12-end

Sony Assurance’s number of automobile insurance policies in force surpassed 1 million

2009-1-19

Sony Assurance started offering pet insurance

2009-4-2

Sony Life commenced sales of cancer hospitalization insurance, advanced medical treatment rider and hospitalization
surgical benefits rider

2009-4-10

SFH announced a shelf registration arrangement for corporate bond issues

35

Recent topics

35

Contact:

Corporate Communications & Investor Relations Department
Sony Financial Holdings Inc.
TEL： +81-3-5785-1074

36

Contacts

36