Presentation Material

Consolidated Financial Results for theYear Ended March 31, 2011
andPreliminary Sony Life’s
Market Consistent Embedded Value
Sony Financial Holdings Inc.
May 20, 20110

Content■Consolidated Operating Results for the Year Ended March 31, 2011

P.2

■Consolidated Financial Forecast for the Year Ending March 31, 2012
2012

P.29

■Dividend Policies

P.31■ Preliminary Sony Life’
Life’s Market Consistent Embedded Value as of March 31, 2011

P.33

■ Appendix

P.35

Disclaimers:
This presentation material contains 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,” and “possibility” that describe future
operating activities, business performance, events or conditions. Forward-looking statements, whether spoken or written, arebased 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

Content1

Consolidated Operating Results for
the Year Ended March 31, 20112

2

Management Review

For the year ended March 31, 2011, consolidated ordinary revenues
increased but consolidated ordinary profit decreased year on year.

The life insurance business continued its stable growth, due tofavorable sales of mainstay death-protection type and third-sector
insurance products such as living benefit and nursing-care insurance.

The non-life insurance business enjoyed brisk sales. An ongoing upward
trend in the number of car accidents for automobile insurance in the firsthalf of FY10 showed signs of slowing during the second half.

The banking business increased profit owing to a growing balance ofloans, especially mortgages, which offset the negative impact of lower
interest rates.

The damage from the Great East Japan Earthquake on our FY10
operating results was limited.
3

During the year ended March 31, 2011, we reviewed consolidated
operating results as follows.
Consolidated operating revenue increased but consolidated operating
profit decreased compared with the previous fiscal year.
The life insurance business continues expanding stably due to favorable
sales of its mainstay death-protection type and third-sector insurance
products such as living benefit and nursing-care insurance.
The non-life insurance business enjoyed brisk sales. An ongoing upward
trend in the number of car accidents for automobile insurance in the firsthalf of FY10 showed signs of slowing during the second half.
The banking business increased profit owing to a growing balance ofloans, especially mortgages, which offset the negative impact of lower
interest rates.
The damage from the Great East Japan Earthquake on our FY10
operating results was limited.

3

Highlights of Consolidated Operating Performancefor the Year Ended March 31, 2011 (1)(Billions of yen)

Ordinary revenues

978.9

Ordinary profit

1,002.2
+2.4%

76.8

882.0

900.3

+18.3

+2.1%

Ordinary profit

79.7

72.1

(7.6)

(9.5%)

Non-life
insurancebusiness

Ordinary revenues

68.1

74.1

+5.9

+8.8%

2.5

2.1

(0.4)

(16.4%)

30.5

29.5

(0.9)

(3.2%)

1.9

2.4

+0.4

+24.9%

(1.7)

(1.8)

(0.1)

+7.7%
+37.8%

Ordinary profit
Ordinary revenues
Ordinary profit

Corporateandelimination

Ordinary revenues

0.0

0.1

+0.0

978.9

1,002.2

+23.2

+2.4%

Ordinary profit

84.3

76.8

(7.5)

(8.9%)Net income

48.1

41.7

(6.4)

(13.3%)

10.3.3111.3.31

Change from 10.3.31

Total assets

6,001.0

6,597.1+596.0+9.9%

Net assets

269.4

294.8

+25.4

+9.4%

Ordinary profit
Ordinary revenues

Consolidated(Billions of yen)

FY10(Billions of yen)

ChangeOrdinary revenues

84.3

FY09

FY10

Life
insurancebusiness

Bankingbusiness(8.9%)

FY09

Consolidated(Note) Comprehensive income: FY09: ¥71.0 billion, FY10: ¥31,9 billion yen
Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

4

During the year ended March 31, 2011, consolidated ordinary revenues
increased 2.4% year on year, to ¥1,002.2 billion. As for the breakdown bybusiness segment, ordinary revenues increased for the life insurance andthe non-life insurance businesses, but decreased for the banking
business.
Consolidated ordinary profit decreased 8.9%, to ¥76.8 billion, reflecting
decreases in ordinary profit from the life insurance and the non-life
insurance businesses, whereas ordinary profit from the banking businessincreased year on year.
Consequently, net income decreased 13.3% year on year, to ¥41.7 billion.

4

Highlights of Consolidated Operating Performancefor the Year Ended March 31, 2011 (2) Life Insurance: Ordinary revenues increased year on year, due to higher income from insurance

premiums associated with steady increases in the new policy amount and the policy amount in force,
which offset a negative impact of a decrease in investment income. Ordinary profit decreased, mainlyreflecting an increase in provision for reserve for outstanding claims, affected by the Great East Japan
Earthquake, and an increase in provision of policy reserve for minimum guarantee for variable life
insurance, as well as an additional provision of policy reserve for some third-sector insurance products,
due to a change in actuarial assumptions, which offset the positive impact of higher investment
revenues in the general account assets.
 Non-life Insurance: Ordinary revenues increased year on year, due to increased net premiums written,

as the number of insurance policies in force grew, primarily for our mainstay automobile insurance.
Ordinary profit decreased, owing mainly to increases in net losses paid and the provision for reservefor outstanding losses due to an increased number of car accidents, which offset the positive impact ofa lower expense ratio.
 Banking: Ordinary revenues decreased year on year, due mainly to a decrease in gains on foreignexchange transactions. Gross operating profit increased, led by a expanding business operations,especially mortgage loans, and improved investment performance. Ordinary profit increased, as thebusiness offset the negative impact of higher general and administrative expenses, particularly
system-related expenses.
 Consolidated ordinary revenues increased 2.4% compared with the previous fiscal year, to ¥1,002.2

billion, however, consolidated ordinary profit and net income decreased 8.9%, to ¥76.8 billion, and13.3%, to ¥41.7 billion respectively.

55Consolidated Operating Performancefor the Year Ended March 31, 2011 (Appendix)
Negative impact on consolidated ordinary
profit of the Great East Japan Earthquake: ¥5.5 billion
Principal Impact on Each BusinessLife Insurance Business・ Insurance claims and other payments (including provision for reserve for outstanding claims) of¥5.4 billion*, others* The figure above is the amount which impact to the operating profit. The total insurance claims and other payments amounted to approx. ¥5.9 billion.

Non-Life Insurance Business・ Mainstay automobile insurance exempt from earthquakes and tsunamis
Banking Business・ Increased allowance for mortgage loans in stricken region
Reference: Principal Responses to Customers Affected by DisasterSony Life・Paid full amount of claims on insurance for death due to disaster
・Extended period after which policyholder nonpayment results in lapse of coverage
・Simplified and expedited payment of claims, benefits and policyholder loans・Applied special interest rate to new policyholder loans (concessionary interest rates)
・Introduced special handling for hospital treatment, others

Sony Assurance
・Introduced special facilities for automobile insurance policy extension procedures and established period after which nonpayment results in lapse of coverage・Introduced special facilities to handle cancellation procedures and issue certifications of suspension on automobile insurance
・Introduced special facilities for payment of hospitalization insurance claims and surgery insurance claims on medical and cancer insurance, others

Sony Bank・Offered telephone consultation on extending repayment of mortgage loans
・Began handling mortgage loans with special interest rates, others
・Enabled transfers to other banks, upon telephone confirmation of identity

・Waived reissuance fee for customers who had lost cash cards

Looking at the effects of the earthquake on Group performance,
consolidated operating profit was down approximately ¥5.5 billion. Of
which, insurance claims and other payments including an increase inprovision for reserve for outstanding claims amounted to ¥5.4 billion in thelife insurance business. This figure is the amount which impact to theordinary profit.

6

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

881.7

Ordinary profit(Billions of yen)

900.0

Ordinary revenues

80.0 (8.6%)

73.1(Billions of yen)Ordinary revenues increased but ordinary profit decreased
year on year.
Income from insurance premiums increased due toincreases in the new policy amount and the policy amountin force.
Investment income decreased mainly due to the deterioration of
investment performance on separate account assets, which offset
the positive impact of higher interest income and dividends andgains on sale of securities among general account assets.
Ordinary profit decreased, mainly reflecting an increase in provision
for reserve for outstanding claims, affected by the Great East Japan
Earthquake, and an increase in provision of policy reserve forminimum guarantee for variable life insurance, as well as anadditional provision of policy reserve for some third-sector insurance
products, due to a change in actuarial assumptions, which offset thepositive impact of higher investment revenues in the general accountassets.

Change

+18.2

+2.1%

Income from insurance premiums

700.1

770.3

+70.2

+10.0%

Investment income(31.9%)

175.3

119.5

(55.8)

Interest income and dividends

70.6

87.5

+16.8

+23.9%

Income from monetary trusts, net

22.8

6.9

(15.9)(69.5%)

Gains on sale of securities

15.1

24.9

+9.8

+65.4%

Gains on separate accounts, net

62.7

－

(62.7)(100.0%)

+3.1%

801.6

826.9

+25.2

Insurance claims and other payments

274.2

297.9

+23.6

+8.6%

Provision for policy reserve and others

395.5

392.7

(2.8)

(0.7%)

Investment expenses

20.5

19.3

(1.2)

(6.2%)

10.0

1.8

(8.2)

(81.5%)

Losses on sale of securities

FY10

FY10
900.0

Ordinary expenses

FY09

FY09
881.7

+2.1%

－

7.4

+7.4

－

96.8

99.3

+2.5

+2.6%

Ordinary profit

80.0

73.1

(6.9)

(8.6%)Net income

46.1

40.2

(5.9)

(12.8%)

Losses on separate accounts, net
Operating expenses(Billions of yen)

10.3.3111.3.31

Change from 10.3.31

Securities

3,539.1

4,017.5+478.4

Policy reserves

3,985.6

4,371.4+385.8+9.7%

Total net assets

191.3

215.3

+24.0

+12.6%Net unrealized gains onother securities
Total assets
Separate account assets+13.5%

15.4

7.0

(8.4)

(54.6%)

4,286.5

4,723.3+436.7+10.2%

373.6

398.1

+24.5

+6.6%

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

7

Highlights of Sony Life’s operating performance (non-consolidated basis) are shown here.
Sony Life’s ordinary revenues increased 2.1% year on year, to ¥900.0 billion. Income frominsurance premiums increased owing to steady increases in the new policy amount andthe policy amount in force.
Income from insurance premiums grew 10.0% from the same period of the previous fiscal
year, to ¥770.3 billion.
Investment income decreased 31.9% year on year, to ¥119.5 billion, mainly due to thedeterioration of investment performance on separate account assets, which offset thepositive impact of higher interest income and dividends and gains on sale of securities
among general account assets.
Investment expenses decreased 6.2% year on year to ¥19.3 billion due to a decrease inloss on sale of securities in the general accounts, though recording a loss on separate
accounts, net.
Ordinary profit decreased 8.6% year on year to ¥73.1 billion, Ordinary profit decreased,
mainly reflecting an increase in provision for reserve for outstanding claims, affected by
the Great East Japan Earthquake, and an increase in provision of policy reserve forminimum guarantee for variable life insurance, as well as an additional provision of policy
reserve for some third-sector insurance products, due to a change in actuarial
assumptions, which offset the positive impact of higher investment revenues in thegeneral account assets.
Consequently, net income decreased 12.8% year on year, to ¥40.2 billion.

7

Overview of Performance:
Sony Life (Non-consolidated)(Billions of yen)

FY09

FY10

ChangeNew policy amount

4,049.2

4,199.0+3.7%

Lapse and surrender amount

2,342.4

2,143.6(8.5%)

Lapse and surrender rate

7.21%

6.41%

(0.80pt)

Policy amount in force

33,470.7

34,748.5+3.8%Annualized premiums from new policies

68.7

71.2

+3.6%

Of which, third-sector products

16.2

16.6

+2.6%

573.3

604.7

+5.5%

133.0

140.7

Annualized premiums from insurance in force
Of which, third-sector products(Billions of yen)

FY09

+5.8%
ChangeFY10

Gains from investment, net (General account)

92.0

107.6

+17.0%

Core profit

64.5

56.2

(12.7%)

Negative spread

11.5

6.3

Solvency Margin Ratio(45.2%)

10.3.3111.3.31

Changefrom
10.3.312,637.3%

2,900.1%＋262.8pt

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, notadjusted for policy amount decreases, increases, and reinstatements, by the policy amount in force at the
beginning of the fiscal year.

(Reasons for changes)
 Increased, due mainly to favorable sales of living
benefit insurance, nursing-care insurance and term life
insurance.

 Decreased due to the lowering lapse and surrender
rates in most products, mainly in family income
insurance, which is life insurance with disability benefit.

 Increased due to an increase in interest income anddividends, as well as gains on sale of securities in linewith the shift from investing in bonds with short terms
to maturity to those with ultralong-terms.

 Declined, mainly reflecting an increase in provision forreserve for outstanding claims, affected by the Great
East Japan Earthquake, and an increase in provisionof policy reserve for minimum guarantee for variable
life insurance, despite increases in income frominsurance premiums and interest income anddividends.

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

8

Here is an overview Sony Life’s performance.

8

Sony Life Operating Performance (1)Number of New Policy and Amount

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

New policy amount

Number of new policies
Annualized premiums from new policies(Thousands of policies)(Billionsof yen)
+2.9%

5.0

599

582

(Trillions of yen)

524

600
80

534
4.19

4.0

3.80

3.87

Of which, third-sector

500

70

63.4

4.02

71.2

68.7
61.6

+3.6%

60
+3.7%

400
50

3.0

300

40
30

2.0

200
+2.6%

20
1.0

100

0.0

0
FY07

FY08

FY09

FY10

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

10

13.3

13.4

FY07

FY08

16.2

16.6

FY09

FY10

0

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

9(Left-hand graph)
New policy amount for the total of individual life insurance and individual
annuities increased 3.7% year on year, to ¥4.19 trillion, owing mainly tofavorable sales of living benefit insurance, nursing-care insurance andterm life insurance. The number of new policies increased 2.9% year on
year, to 599 thousand policies.
(Right-hand graph)
Annualized premiums from new policies increased 3.6%, to ¥71.2 billion,
owing mainly to favorable sales of living benefit insurance, nursing-careinsurance and term life insurance.
Of this amount, the figure for third-sector products was ¥16.6 billion, up
2.6% year on year.

9Sony Life Operating Performance (2)Number of Policy and Policy Amount in Force

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

Annualized premiums from insurance in force

Number of policies in force

Of which, third sector(Millions of policies)(Trillions of yen)(Billions of yen)
+6.7%

50

5.34

+5.5%

600

5.01
4.43

547.8

500

40

31.4

530.0

5

4.70

604.7

573.3

32.5

33.4

34.7

4

+3.8%

400

30
3
300

20

2

200
+5.8%

10

1

0

0
08.3.31

09.3.3110.3.3111.3.31

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

100

122.8

126.6

133.0

140.7

08.3.31

09.3.3110.3.3111.3.310Line item amounts are truncated below ¥100 million;
percentage change figures are rounded

10(Left-hand graph)
Policy amount in force for the total of individual life insurance andindividual annuities grew steadily, to ¥34.7 trillion as of March 31, 2011,
up 3.8% from March 31, 2010. The number of policies in force increased
6.7% from March 31, 2010, to 5.34 million policies.
(Right-hand graph)
Annualized premiums from total policies as of March 31, 2011, were up
5.5% from March 31, 2010, totaling ¥604.7 billion. Of this amount, thefigure for third-sector products was up 5.8% from March 31, 2010, to¥140.7 billion.

10

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

Income from Insurance Premiums(Individual Life Insurance + Individual Annuities)+10.0%

800
(%)

10

648.4

662.0

FY07

FY08

770.3

700.1

600
8

6.79

7.21

6.41

6.12
6

400

(0.80pt)

4

200
2

0

0

FY07

FY08

FY09

FY10

FY09

FY10

*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(Left-hand graph)
The lapse and surrender rate for the year ended March 31, 2011
decreased 0.8 percentage point year on year, to 6.41%, due to thelowering lapse and surrender rates in most products, mainly in family
income insurance, which is life insurance with disability benefit.
(Right-hand graph)
Income from insurance premiums for the year ended March 31, 2011,
increased due to the aforementioned reasons.

11Sony Life Operating Performance (4)Ordinary Profit

Core Profit(Billions of yen)(Billions of yen)

70

64.5

100

56.2

60

80.0

80

(12.7%)

73.1

50(8.6%)

40
30

60

38.0

40

23.5

39.2
32.4

20

20
10

0

0
FY07

FY08

FY09

FY10

FY07

FY08

FY09

FY10

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

12(Left-hand graph)Core profit decreased 12.7% to ¥56.2 billion year on year, mainlyreflecting an increase in provision for reserve for outstanding claims,
affected by the Great East Japan Earthquake, and an increase inprovision of policy reserve for minimum guarantee for variable life
insurance, despite increases in income from insurance premiums andinterest income and dividends.
(Right-hand graph)
Ordinary income for the year ended March 31, 2011, decreased due tothe aforementioned reasons.

12Sony Life Operating Performance (5)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

(Billions of yen)

Investment yield in general account30

Investment yield for core profit

26.7
3.00%

25

2.68%

21.3

2.54%
2.68%

20
2.00%

15

11.5
10

2.59%

2.17%

2.51%

2.43%

2.17%

2.26%

FY09

FY10

1.90%
(45.2%)

1.73%

6.3
1.00%

1.11%

5

0

FY07

FY08

FY09

FY10

0.00%
FY07

FY08

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

13(Left-hand graph)
In line with the increase in interest income and dividends, the negative
spread declined 45.2% year on year, to ¥6.3 billion.

(Right-hand graph)
The average assumed interest rate was 2.43%
Investment yield in the general account was 2.68%, andInvestment yield for core profit was 2.26%.

13

Sony Life Operating Performance (6)Number of Lifeplanner Sales Employees(Number)Number of Independent Agents(Number)

4,036
4,000

3,891

4,017

2,500

(19)

2,151

3,779

2,112

2,089

2,000

2,064
(25)

3,500
1,500

3,000
0

0
1,000
08.3.31

09.3.3110.3.3111.3.3108.3.31

09.3.3110.3.3111.3.31* “Lifeplanner” is a registered trademark of Sony Life Insurance Co., Ltd.

14

(Left-hand graph)
The number of Lifeplanner sales employees as of March 31, 2011, was
4,017, down 19 from March 31, 2010. This decrease was the result of alower number of new recruits due to the revised recruitment standards,
and a higher number of resignations.
(Right-hand graph)
The number of independent agents decreased 25 from March 31, 2010,
to 2,064.

14

Sony Life Operating Performance (7)Breakdown of General Account Assets
10.3.3111.3.31<Asset management review>(Billions of yen)Amount%Amount%3,032.9

77.5%

3,499.9

80.9%Japanese stocks

72.5

1.9%

64.0

1.5%

Foreign securities

49.9

1.3%

44.2

1.0%

Japanese governmentand corporate bonds

Japanese government and corporate bonds:
Continued to accumulate ultralong-term bonds during
FY10.

<Lengthened
asset duration><L

Foreign stocks

25.3

0.6%

30.0

0.7%

Monetary trusts

288.7

7.4%

276.4

6.4%

Policyholder loans

127.5

3.3%

134.4

3.1%

Real estate

79.9

2.0%

75.1

1.7%

Cash and call loans

116.4

3.0%

80.0

1.9%

Other

119.4

3.0%

120.9

2.8%

3,912.9

100.0％

4,325.2

100.0％

Total

09. 3.31

13.6 years

10. 3.31

17.6 years

11. 3.31

18.5 years

Japanese stocks: Maintained the ratio of stock
holding at the end of March 2009.

■CB and Japanese stock holding
As of March 31, 2010：
The balance of CBs was ¥13.2 billon included in Japanese
government and corporate bonds. The balance of Japanesestocks included in the monetary trusts was zero.
As of March 31, 2011：
The balance of CBs were zero in all categories and Japanesestocks included in the monetary trusts was zero.
■Investment in the monetary trusts are mainly into Japanese
government and corporate bonds■The holding ratio on the real status, of Japanese government andcorporate bonds including those invested in monetary trusts in thegeneral account assets:
As of March 31, 2011: 87.3%, As of March 31, 2010: 84.6%

15

Here is a breakdown of Sony Life’s general account assets as of March
31, 2011, compared with March 31, 2010.
As Sony Life increased its investment in ultralong-term bonds, mainly
Japanese government and corporate bonds, their ratio rose to 87.3% asof March 31, 2011.
As a result of these efforts, Sony Life’s asset duration become 18.5 years
as of March 31, 2011.
By the end of the first half of FY10, Sony Life had shifted its investments
in bonds with short terms to maturity to those with ultralong terms with theaim of reducing interest rate risk. As a result, Sony Life has succeeded inlimiting its exposure to interest rate fluctuations, and the process ofshifting its bond holdings is largely complete.
Going forward, Sony Life plans to mitigate interest rate risk by investing
most new money acquired in ultralong-term bonds.

15

Sony Life Operating Performance (8(8)
Solvency Margin Ratio

Adjusted Net Assets（％）(Billions of yen)

2,900.1

3,000

700

2,637.3[629.1]

612.0
600

2,500

[505.9]

606.9

563.4

532.6

2,060.5
2,000[583.8]

+7.7%

500

1,747.9400

1,500＜Reference＞

1,000

300

New solvency margin ratio effective
as of the end of FY11

As of March 31, 2011 : 1,720.0%
500

200

Variation factor from the previous standard ：◆Change of includable amount for margin calculation

100◆Tightening standard for risk factor calculation

0008.3.31

09.3.3110.3.3111.3.31

Note:
Legislation concerning the calculation of the solvency margin ratio has been revised fromthe standpoint of raising its credibility, and these new standards are to become effective asof the end of fiscal 2011 (March 31, 2012). The above-stated figures are calculated on theassumption that these changes are applied at the end of FY10.
* New solvency margin ratio for Sony Life is on P 40.

08.3.31

09.3.3110.3.3111.3.31※Amount in [ ] excludes unrealized gains (losses) on held-to-maturity securities
and on policy reserve matching bonds.
Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

16(Lest-hand graph)
As of March 31, 2011 , Sony Life’s solvency margin ratio was 2,900.1%,
up 262.8 percentage points from March 31, 2010.
The new solvency margin ratio is indicated for reference, amounting to
1,720.0% as of March 31, 2011. The reasons for the decrease from thecurrent standard are a change of includable amount for margin calculationand the tightening standard for risk factor calculation.
(Right-hand graph)
Adjusted net assets increased 7.7% from March 31, 2010.
Sony Life will continue to work on maintaining its financial soundness.

16

Highlights of Operating Performance:
Sony Assurance
Ordinary revenues

68.1

Ordinary profit

+8.8%

74.1

(Billions of yen)
Ordinary revenues
Underwriting income

FY09

68.1

74.1

+5.9

+8.8%

67.4

73.3

+5.9

+8.8%

0.6

0.7

+0.0

+12.5%

65.6

72.0

+6.4

+9.8%

Underwriting expenses

49.1

54.4

+5.3

+10.8%

Investment expenses

0.0

0.0

(0.0)

(81.1%)

Investment income
Ordinary expenses

2.1

2.5

Operating, general andadministrative expenses(16.4%)

FY09

Change

FY10

16.3

17.4

+1.1

+6.7%

Ordinary profit

2.5

2.1

(0.4)

(16.4%)Net income

1.6

1.2

(0.3)

(19.2%)

FY10(Billions of yen)Ordinary revenues increased but ordinary profit
decreased year on year.
Ordinary revenues increased, due to an increase in
net premiums written led by a growing number of
in-force policies primarily for automobile insurance.
Ordinary profit decreased, owing mainly to increases in
net losses paid and the provision for reserve foroutstanding losses due to an increased number of car
accidents, which offset the positive impact of a lower
expense ratio.

(Billions of yen)

10.3.3111.3.31

Change from 10.3.31

Underwriting reserves

58.1

64.0

+5.9

Total net assets

15.4

16.7

+1.2

+8.3%

Total assets

98.3

109.3

+11.0

+11.2%+10.2%

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

17

Sony Assurance posted a 8.8% increase in ordinary revenues year on
year, to ¥74.1 billion, due to increased net premiums written, as thenumber of insurance policies in force grew in its mainstay automobile
insurance.
Ordinary profit decreased 16.4% year on year, to ¥2.1 billion, owing
mainly to increases in net losses paid and the provision for reserve foroutstanding losses due to an increased number of car accidents, which
offset the positive impact of a lower expense ratio.
Net income decreased 19.2% year on year, to ¥1.2 billion.

17

Overview of Performance:
Sony Assurance(Reasons for changes)(Billions of yen)

FY09

FY10

ChangeDirect premiums written

67.0

72.8

Net premiums written

67.4

73.3

+8.6%
+8.8%

Net losses paid

34.5

39.2

+13.5%(25.8%)

1.9

1.4

Net loss ratio

57.2%

60.0%

+2.8ptNet expense ratio

26.1%

25.5%

(0.6pt)Combined ratio

83.3%

85.6%

+2.3ptUnderwriting profit

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.

Number of policies in force
Solvency margin ratio

10.3.3111.3.31

1.27 million

1.38 million

1,018.5%

981.4%The number of policies in force is the total of automobile insurance andmedical and cancer insurance, which accounts for 99% of net premiums written.

 Increased, owing to an increase in thenumber of policies in force for automobile
insurance.
 Increased, owing to an increase in thenumber of policies in force and a risingnumber of loss ratio for automobile
insurance.
 Decreased, due to increased net
premiums written which offset anincrease in underwriting costs.

 Increased, due to an increase in thenumber of policies in force for automobile
insurance.

Change from 10.3.31+0.10 million+8.4%(37.1pt)

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

18

Here is an overview of Sony Assurance’s performance.

18

Sony Assurance’s Underwriting Performanceby Type of Policy
Direct Premiums Written

Net Premiums Written

FY09

FY10

FY09

Change278

Fire

Voluntary automobile

185(33.6%)

Fire

12

8

(34.6%)

Marine2

5+148.2%

－

－

－

7,135

+2.8%

Personal accident*

7,168

7,369

+2.8%

+9.5%

Voluntary automobile

59,60465,245

+9.5%

651

714

+9.7%

67,44073,343+8.8%

59,849Compulsory
automobile liability

65,516－
67,069

Total

Change6,941

MarinePersonal accident*

FY10(Millions of yen)

(Millions of yen)－
72,837－+8.6%

Net losses paid

Compulsory
automobile liability
Total*SURE, medical and cancer insurance is included in personal accident.
FY09

ChangeFY10(Millions of yen)
Fire

0

0

+292.5%+271.1%2

11

Personal accident*

1,479

1,620

+9.5%

Voluntary automobile

32,55536,941+13.5%

535

683+27.7%

34,57339,256+13.5%

MarineCompulsory
automobile liability
Total

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

19This slide shows direct premiums written, net premiums written and net
losses paid by type.

19

Sony Assurance Operating Performance (1)Net Premiums Written andNumber of Policies in Force
Voluntary automobile insurance

Personal accident insurance(Millions of policies)

Number of policies in force

Other(Billions of yen)

+8.4%

100

1.4

1.15

(Billions of yen)

5

1.2
4

73.3

1.02
67.4

70
60

1.38

1.27

90
80

Ordinary Profit

1

61.1
+8.8%

55.0

0.8

3

2.8
2.5

50
0.6

40
30

2.1

2.1
2

(16.4%)

0.4

20

1

0.2
10
0

0
FY07

FY08

FY09

FY10

The number of policies in force is the total of automobile insurance and medical
and cancer insurance policies, which account for 99% of net premiums written.
More than 90% of personal accident insurance is medical and cancer insurance.

0
FY07

FY08

FY09

FY10

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

20(Left-hand graph)
Number of policies in force for the total of automobile insurance andmedical and cancer insurance increased steadily, rising 8.4% year on
year, to 1.38 million policies.
Net premiums written posted a 8.8% year-on-year increase, to ¥73.3
billion.
(Right-hand graph)
Ordinary profit decreased year on year, as described in the previous
pages.

20

Sony Assurance Operating Performance (2)Reference
Net Expense Ratio +Earned/Incurred Loss Ratio
Net expense ratio

Combined Ratio(Net Expense Ratio + Net Loss Ratio)

Earned/Incurred loss ratio

Net expense ratio(%)+3.3pt

100

89.0

90.2

95.2

91.9

100
+2.3pt80

80+3.9pt

60
62.3

63.5

80.3

81.7

83.3

55.0

57.2

85.6

69.7

60

65.8

53.5

40

20

Net loss ratio(%)+2.8pt

60.0

40

26.7

26.7

20

(0.6pt)

26.1

25.5

FY09

FY10

0

26.7

26.7

FY07

FY08

(0.6pt)

26.1

25.5

FY09

FY10

0
FY07

FY08

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 premiums.
*Note that earthquake insurance and compulsory automobile liability

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.

insurance are excluded from the above calculation.

21(Left-hand graph)
To help you understand the actual condition of Sony Assurance, which isin a growth phase, we show the earned/incurred loss ratio, which is theaccrual-basis loss ratio.
For the year ended March 31, 2011, the E.I. loss ratio increased 3.9
percentage points year on year, to 69.7%, due to increases in the net
losses paid and the provision for reserve for outstanding losses resulting
mainly from a rising number of car accidents.
The net expense ratio dropped 0.6 percentage point, to 25.5%, due to anincrease in net premiums, although the underwriting costs increased.
(Right-hand graph)
The net loss ratio rose 2.8 percentage points compared with the same
period of the previous fiscal year, to 60.0%, due to a rising number of car
accidents.
This is different from the E.I. loss ratio, which reflects an increase or adecrease in provision for reserve for outstanding losses.
As a result, the combined ratio (the sum of the net loss ratio and the net
expense ratio) rose 2.3 percentage points year on year, to 85.6%.

21

Sony Assurance Operating Performance (3)Solvency Margin Ratio
(%)

1,200

1,073.9993.0

1,018.5

981.4

800

＜Reference＞
New solvency margin ratio effective as of the end of FY11400

As of March 31, 2011 : 631.0%
Variation factor from the previous standard◆Tightening standard for risk factor calculation

008.3.31

09.3.3110.3.3111.3.31

Note:
Legislation concerning the calculation of the solvency margin ratio has been revised from the standpoint of raising its credibility, and these new standards are to
become effective as of the end of fiscal 2011 (March 31, 2012). The above-stated figures are calculated on the assumption that these changes are applied at theend of FY10.

22

As of March 31, 2011, Sony Assurance’s solvency margin ratio was
981.4%, down 37.1 percentage points from March 31, 2010. Sony
Assurance has maintained financial soundness.
The new solvency margin ratio is indicated for reference, amounting to631.0% as of March 31, 2011. The reason for the decrease from thecurrent standard is the tightening standard for risk factor calculation.

22

Highlights of Operating Performance:
Sony Bank (Non-consolidated)
Ordinary revenues

Ordinary profit

30.5(Billions of yen)

29.5
(3.2%)

3.3+15.3%

2.9

FY09

Ordinary revenues decreased but ordinary profit
increased year on year.
Gross operating profit increased ¥1.5 billion due toincreases in net interest income and net other operating
income.
- Net interest income increased ¥0.2 billion owing to a
growing balance of investment assets, especiallymortgage loans, in its business expansion.
- Net other operating income increased ¥1.2 billion
reflecting improved investment performance.
Net operating profit increased, owing mainly to anincrease in gross operating profit, which offset higher
general and administrative expenses.
Customer assets increased ¥145.5 billion from March 31,
2010, of which deposit balance increased ¥139.0 billion.

FY10

Change

30.5

29.5

(0.9)

(3.2%)

Gross operating profit

14.9

16.4

+1.5

+10.1%+1.8%

Net interest income

13.0

13.2

+0.2

Net fees and commissions

(0.1)

(0.1)

+0.0

－

Net other operating income

2.1

3.3

+1.2

+58.7%

General andadministrative expenses

11.6

12.6

+0.9

+7.9%

Ordinary profit

2.9

3.3

+0.4

+15.3%Net income

1.6

2.0

+0.4

+24.8%Net operating profit

3.2

3.6

+0.4

+13.4%

10.3.3111.3.31(Billions of yen)

FY10(Billions of yen)

FY09

Ordinary revenues

Change from 10.3.31

Securities

880.1

940.1

+59.9

+6.8%

Loans

586.6

722.4

+135.7+23.1%

Deposits

1,510.0

1,649.1+139.0+9.2%

Customer assets

1,610.0

1,755.5+145.5+9.0%

Total net assets

58.9

59.9

+0.9

+1.7%

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

0.9

0.4

(0.4)

(52.7%)

1,612.1

1,761.8+149.6+9.3%

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

23

Highlights of Sony Bank’s operating performance (non-consolidated
basis) are shown here.
Sony Bank’s ordinary revenues decreased 3.2% year on year, to ¥29.5
billion, owing primarily to a decrease in gains on foreign exchangetransactions.
Gross operating profit increased 10.1% from a year earlier, to ¥16.4
billion, due mainly to an increase in net other operating income reflecting
improved investment performance.
General and administrative expenses expanded 7.9% year on year, to¥12.6 billion, due mainly to an increase in system-related expenses.
As a result, ordinary profit increased ¥15.3%, to ¥3.3 billion.
Net income amounted to ¥2.0 billion, up 24.8% from the same period of
the previous fiscal year, due to increased ordinary profit .

23

Overview of Performance:
Sony Bank (Non-consolidated) (1)(Reasons for changes)
FY09

FY10

Customer assets

1,610.0

1,755.5+145.5+9.0%

Deposits

1,510.0

1,649.1+139.0+9.2%

Yen

1,184.9

1,289.8+104.8

+8.9%

325.0

359.2

+34.1

+10.5%

100.0

106.4

+6.4

+6.5%

586.6

722.4

+135.7+23.1%

Change

Foreign currency
Investment trusts
Loans outstanding
Mortgage loans

555.1

656.0

+100.9+18.2%

Others31.5

66.4(*1)+34.8+110.5%

Number of accounts(thousands)

796

859
*1

+62

+7.8%

12.09%

10.84%

Capital adequacy ratio(*2)(domestic criteria)(1.25pt)

Foreign currency deposit increased
reflecting growing demand for saving
foreign currency under the market
fluctuation even though the sharp hike inthe yen might have the negative impact
on the foreign exchange conversion.

 Loan balance steadily increased due toincreases in mortgage loans andcorporate lending centering on syndicatedloans.

.

*1 Loans in others include corporate loans of ¥58.4 billion.
*2 Please refer to the graph of the non-consolidated capital adequacy ratio (domestic criteria) on P28.
Line item amounts are truncated below ¥100 million; numbers of accounts are truncated below 1,000 accounts; percentage change figures are rounded.

24

Here is an overview of Sony Bank’s performance.

24

Overview of Performance:
Sony Bank (Non(Non-consolidated) (2)<Reference><Reference> On Managerial Accounting Basis(Billions of yen)
Gross operating profit
Net interest income *1 ①

FY09

FY10

14.9

16.4

+1.5

+10.1%

13.7

15.1

+1.3

+10.2%

0.9

0.8

(0.1)

(14.2%)Net other operating
income *3

0.2

0.4

+0.1

+69.4%

14.6

15.9

+1.2

+8.6%

Operating expenses andother expenses ③
Net operating profit(core profit)= (A)－③

Gross operating profit (core profit)

Net operating profit (core profit)

Operating expenses and other expenses

Net fees andcommissions *2 ②Gross operating profit(core profit) (A)= ①＋②

Net Operating Profit (Core Profit),
Operating Expenses and Other Expenses& Gross Operating Profit (Core Profit)

Change(Billions of yen)

20

11.7

12.8

+1.0

+9.2%

2.9

3.0

+0.1

+6.3%

15

14.6
11.7

+8.6%

15.9

+9.2%

12.8

10

●Managerial accounting basis
The following adjustments are made to the figures on a financial accounting basis toaccount for profits and losses 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), consists of profits
and losses for bond and derivative dealing transactions.

5

2.9

+6.3%

3.0

0

●Core profit
FY09
FY10
Profits and losses exclude net other operating income, which includes those on bond andderivative dealing transactions, and stands for Sony Bank’s basic profits.
Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

25

We break down gross operating profit on a managerial accounting basis
to facilitate an understanding of operational sources of revenue andprofits.
(Left-hand table)
Net interest income on a managerial accounting basis increased ¥1.3
billion year on year, to ¥15.1 billion, due to higher interest on loan from a
growing balance of mortgage loans and improved investment
performance on foreign currency deposits.
Net fees and commissions amounted to ¥0.8 billion, down ¥0.1 billion,
owing primarily to a decrease in profits on customer dealings in foreign
currency transactions stemming from adverse foreign exchange market
conditions.
Net other operating income rose ¥0.1 billion, to ¥ 0.4 billion. This was
mainly because investment performance on bond dealing transactions
improved year on year.
Consequently, gross operating profit on a core profit basis increased ¥1.2
billion year on year, to ¥15.9 billion.
(Right-hand graph)
Net operating profit on a core profit basis increased ¥0.1 billion year on
year, to ¥3.0 billion.

25

Sony Bank Operating Performance (1)<Reference>＜参考＞ Interest Spread (Managerial Accounting Basis)
Interest spread

Yield on investment

Yield on financing

(%)

2.00

1.50

1.49

1.44

1.44

1.42

1.40

+0.06%

1.00

0.90

0.59

0.86

0.87

0.88

0.58

0.57

0.53

0.94

0.45

0.50

0.00
FY09.4Q

FY10.1Q

FY10.2Q

FY10.3Q

FY10.4Q

Notes: Interest spread = Yield on investment – Yield on financing
Yield on investment includes primarily gains or losses from currency swap transactions in net other operating income.

26

This chart shows the interest spread on a managerial accounting basis.
The yield on investment slightly decreased for FY10. 4Q, at 1.40%, due
to the lowering of interest rates around the world. The yield on financing
dropped to 0.45% .
Interest spread has been increasing since the beginning of this fiscal year,
and reached 0.94% for this 4th quarter, up 0.06 percentage points fromthe 3rd quarter.

26

Sony Bank Operating Performance (2)Customer Assets (Deposits + Investment Trusts)
and Number of Accounts
Yen deposits
Foreign currency deposits
Number of accounts (thousands)(Billions of yen)
2,000

723

Loans
Mortgage loans

Investment trusts
+62

796

610

Others*Including corporate loans of ¥58.4 billion.

(Billions of yen)
800

859

722.4
+135.7

1,755.5

66.4*+145.5106.4

1,610.0
1,500

1,403.6

586.6

600

359.2

477.0

1,247.3
400
1,000

347.0
656.0

Deposits total:¥1,649.1 billion

1,289.8

200

500

0

0

08.3.31

09.3.3110.3.3111.3.3108.3.31

09.3.3110.3.3111.3.31

Line item amounts are truncated below ¥100 million; number of accounts are truncated below 1,000 accounts.

27(Left-hand graph)
As of March 31, 2011, customer assets (the sum of deposits andinvestment trusts) were up ¥145.5 billion from March 31, 2010, to¥1,755.5 billion.
As for the breakdown of customer assets as of March 31, 2011, deposits(the sum of Japanese yen and foreign currency deposits) amounted to¥1,649.1 billion, up ¥139.0 billion from March 31, 2010.
Of which foreign currency deposit increased ¥34.1 billion reflecting
growing demand for saving foreign currency under the market fluctuationeven though the sharp hike in the yen might have the negative impact on
the foreign exchange conversion.
Investment trusts were ¥106.4 billion, up ¥6.4 billion from March 31, 2010.
As of March 31, 2011, the number of accounts was 859 thousand, up 62
thousand accounts from March 31, 2010.
(Right-hand graph)
Loans expanded to ¥722.4 billion, up ¥135.7 billion, from March 31, 2010,
owing to a growing balance of mortgage loans, as well as an increase incorporate loans.

27Sony Bank Operating Performance (3)Non-Consolidated Capital Adequacy Ratio(Domestic Criteria)

Balance of Securities by Credit Ratings
AAA
AA
BBB
BB
(Billions of yen)
1,200

A
Other

(%)

20

+59.9
940.1

1,000

823.1

880.1
13.37

15

800

12.09
10.84

600

10

488.7

9.15
(1.25pt)

400
5

200

0

0
08.3.31

09.3.3110.3.3111.3.3108.3.31

09.3.3110.3.3111.3.31* 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 Financial Services
Agency of Japan (“FSA”) public ministerial announcement No. 19 of 2006.

Amounts are truncated below ¥100 million.

28(Left-hand graph)
As of March 31, 2011, the balance of securities increased ¥59.9 billion, to¥940.1 billion from March 31, 2010.
Sony Bank continuously invests in highly rated bonds.
(Right-hand graph)
As of March 31, 2011, Sony Bank’s non-consolidated capital adequacy
ratio (domestic criteria) was 10.84%, down 1.25 percentage point fromMarch 31, 2010. These figures indicate that Sony Bank has maintained asound financial basis.

28

Consolidated Financial Forecast
for the Year Ending March 31, 201229

29

Consolidated Financial Forecast
for the Year Ending March 31, 2012

Consolidated ordinary revenues

FY10

1H FY11

ActualForecast

FY11
Forecast

ChangeFY10 actual vs.

1,002.2

497.0

1,022.0+ 2.0%

Life insurance business

900.3

442.0

909.3

+ 1.0%

Non-life insurance business

74.1

40.1

80.4

+ 8.4%

Banking business

29.5

15.8

32.8

+ 11.0%(23.2%)

Consolidated ordinary profit(Billions of yen)

Banking business
Non-life insurance businessLife insurance business

1,200

1,002.2

1,000

1,022.0

800

76.8

27.0

59.0

Life insurance business

72.1

25.0

53.0

(26.6%)

Non-life insurance business

2.1

0.3

2.6

+ 21.2%

Banking business

2.4

1.7

4.1

+ 70.3%

41.7

13.0

29.0

(30.5％)

Consolidated net income

Consolidated Ordinary Revenues

FY11 forecast

600
400
200
0
FY10 (Actual)■Life insurance business
Ordinary revenues for the year ending March 31, 2012, are expected to increase 1.0% year on year, to ¥909.3 billion. We
anticipate that income from insurance premiums will increase in line with steady growth of the policy amount in force. We
expect ordinary profit to decrease 26.6% year on year, to ¥53.0 billion. During the fiscal year ended March 31, 2011, thebusiness generated net capital gains of ¥23.8 billion, reflecting the process of shifting bond holdings to ultralong-term bonds toreduce interest rate risk. However, we do not anticipate gains on the sale of securities for the year ending March 31, 2012,
because the process of shifting our bond holdings was largely completed in the previous period.

(Billions of yen)100

■Non-life insurance business

90

Ordinary revenues for the year ending March 31, 2012 are expected to rise 8.4% year on year, to ¥80.4 billion, due to anincrease in net premiums written, mainly for mainstay automobile insurance. Ordinary profit is expected to increase 21.2% year
on year, to ¥2.6 billion, due mainly to the aforementioned increase in ordinary revenues and an expected improvement in theloss ratio in line with the February 2011 revision of automobile insurance premiums. This should offset an expected increase in
the expense ratio in line with the planned reinforcement of corporate systems and infrastructure based on the expected
expansion of business operations.

80■Banking Business

FY11 (Forecast)

Consolidated Ordinary Profit
Banking business
Non-life insurance businessLife insurance business

76.8

70

59.0

60
50
40
30

Ordinary revenues for the year ending March 31, 2012, are expected to increase 11.0% year on year, to ¥32.8 billion, owing
mainly to an increase in net interest income, bolstered by a growing balance of loans, especially mortgages. Ordinary profit isexpected to grow 70.3%, to ¥4.1 billion, from the previous fiscal year, as we anticipate a steady increase in gross operating
profit, driven by business expansion that should offset an increase in general and administrative expenses related to new
product and service developments.

2010
0
FY10 (Actual)

FY11 (Forecast)(Billions of yen; amounts are truncated below ¥100 million; percentage changes are rounded.)30

Here is our consolidated financial forecast for the fiscal year ending
March 31, 2012.
SFH’s consolidated financial results forecast for the fiscal year ending
March 31, 2011 is as follows.
We expect consolidated ordinary revenues to increase 2.0%, to ¥1,022.0
billion, compared with the period ended March 31, 2011, owing to steadybusiness expansion in all three business segments. Despite an
anticipated increase in ordinary revenues, we expect consolidated
ordinary profit and net income to decrease 23.2%, to ¥59.0 billion, and30.5%, to ¥29.0 billion, respectively. During the fiscal year ended March
31, 2011, the Group recorded net capital gains of ¥23.8 billion in the life
insurance business, reflecting the process of shifting bond holdings toultralong-term bonds to reduce interest rate risk. However, we do not
anticipate gains on the sale of securities for the year ending March 31,
2012, because the process of shifting our bond holdings was largely
completed in the previous period.

30

(3) Dividend Policies

31

31

Dividend Policies■Basic Idea of Capital and Dividend Policies
We consider an increase in returns to our shareholders, as well as return on equity, among our most importantmanagement tasks. Our basic policy on returning profits to our shareholders is to provide stable dividends toshareholders while ensuring the high level of financial soundness that is necessary to maintain the trust of existingcustomers and attract new ones, as well as securing sufficient retained earnings for future business development.

Dividend ForecastFY10 : ¥4,000 per share (forecast) FY09 : ¥3,000 per share (actual)FY11 : ¥20 per share (forecast)* FY11 dividend forecast reflect the 200-for-1 stock split .

We propose to pay an annual cash dividend of ¥4,000 per share for the year ended March 31, 2011, up ¥1,000 from theprevious period of ¥3,000.
Consolidated net income has risen steadily since October 2007, when we listed our shares on the First Section of theTokyo Stock Exchange. In particular, Sony Life now expects to generate stable asset investment returns, primarily inthe form of interest income, from its asset portfolio over the medium to long term, as a result of revising its asset
portfolio. Furthermore, Sony Life currently maintains sufficient financial soundness from a regulatory perspective.
Even if an indicator based on economic value were introduced in future in a way where we could anticipate, we would
have sufficient surplus available for dividends.



We plan to pay the annual cash dividend of ¥20 per share for the year ending March 31, 2012 if the total dividend
amount is the same as for the year ended March 31, 2011 and reflects the 200-for-1 stock split.



On April 1, 2011, SFH conducted a stock split at a ratio of 200 to one, to improve the environment for investing in its
stock by lowering the unit investment amount and increasing the liquidity of the stock, with the aim of expanding its
investor base. SFH also adopted a Share Unit system, which defines 100 shares as one unit.

32

We propose to pay an annual cash dividend of ¥4,000 per share for theyear ended March 31, 2011, up ¥1,000 from the previous period of¥3,000.

32

Preliminary Sony Life’s
Market Consistent Embedded Valueas of March 31, 201133

Preliminary Sony Life’s Market Consistent Embedded Value

33

Preliminary Sony Life’s Market Consistent
Embedded Value as of March 31, 2011MCEV results 【Preliminary】(Billions of yen)

10.3.31
MCEV

11.3.31

Change

894.0

853.6

(40.4)

Adjusted net worth

206.2

230.3

+24.1

Value of existing business

687.8

623.3

(64.5)

55.6

56.8

+1.2

Of which, new business value

 Sony Life’s preliminary MCEV as of the end of March 31, 2011 decreased year on year, due to decreased value ofexisting business which offset the positive impact of an increase in adjusted net worth under the change of financial
market conditions such as lowering of ultralong-term interest rates.
 Furthermore, to the extent of ultralong-term interest rates as of March 31, 2011, interest swap rates were lower thanJapanese government bond (JGB) yields. Sony Life has been comprehensively managing interest rate risk residing
in its assets and liabilities by investing mainly in ultralong-term JGB in asset side to prepare for the future insurance
claims and other payments in liability side. Thus, it is considered reasonable and proper to use JGB yields as riskfree-rate for calculation of liability side for the purpose of internal risk management. As for the calculation of MCEV
above, we use interest swap rates. Meanwhile, if we calculated the sum of the present value of certainty-equivalentprofit and the time value of options and guarantees which consists of components of value of existing business byusing the JGB yields, instead of interest swap rates, as of the March 31, 2011, this calculation would have shown an
increase in the value of existing business and new business value by ¥47.6 billion and ¥4.8 billion, respectively.

* Please keep in mind that the validity of these calculations has not been verified by outside specialists. MCEV as of March 31, 2011,
calculated in accordance with the MCEV principles and verified by outside specialists, is scheduled to be announced at May 27, 2011.

34

Here is our Preliminary Sony Life’s Market Consistent Embedded Value.
Sony Life’s preliminary MCEV as of the end of March 31, 2011 decreased ¥40.4 billion
year on year, to¥853.6 billion due to decreased value of existing business which offset the positive
impact of an increase in adjusted net worth under the change of financial market
conditions such as lowering of ultralong-term interest rates.
Furthermore, to the extent of ultralong-term interest rates as of March 31, 2011, interest
swap rates were lower than Japanese government bond (JGB) yields. Sony Life has
been comprehensively managing interest rate risk residing in its assets and liabilities byinvesting mainly in ultralong-term JGB in asset side to prepare for the future insurance
claims and other payments in liability side. Thus, it is considered reasonable and proper
to use JGB yields as risk-free-rate for calculation of liability side for the purpose ofinternal risk management. As for the calculation of MCEV above, we use interest swap
rates. Meanwhile, if we calculated the sum of the present value of certainty-equivalentprofit and the time value of options and guarantees which consists of components ofvalue of existing business by using the JGB yields, instead of interest swap rates, as of
the March 31, 2011, this calculation would have shown an increase in the value ofexisting business and new business value by ¥47.6 billion and ¥4.8 billion, respectively.
Please keep in mind that the validity of these calculations has not been verified byoutside specialists. MCEV as of March 31, 2011, calculated in accordance with theEuropean Insurance CFO Forum Market Consistent Embedded Value Principles andverified by outside specialists, is scheduled to be announced at May 27, 2011.
This is end of presentation. Thank you very mach.

34

Appendix

35

Appendix35

Recent Topics 1
AEGON SONY LIFE INSURANCE Sales Update
Launch of sales：December 1, 2009
Common stock：¥20 billion (including capital surplus of ¥10 billion)
Equity ownership：Sony Life insurance Co., Ltd. 50%, AEGON・international B.V. 50%
Marketing products: Variable Individual Annuity (3 types, 5 products)
Sales Channels: Lifeplanner sales employees and affiliated Banks (7*) As of May 20, 2011
Financial Highlights for FY10:
Number of new policies: 781, New policy amount: ¥7.6 billion
Number of policies in force: 1,218 policies, Policy amount in force: ¥13.8 billion

Sony Bank’s Mortgage Loans through Sony Life
Sony Life accounts for 24% of the balance ofmortgage loans as of March 31, 2011
Sony Life accounts for 28% of the amount of
new mortgage loans for FY10*Sony Life started handling banking agency business in January 2008.

Sony Assurance’s Auto Insurance Sold by Sony Life
Sony Life accounts for approx. 5% of new automobile policies
for FY10* Sony Life started handling automobile insurance in May 2001.
“Lifeplanner” is a registered trademark of Sony Life Insurance Co., Ltd.

36

(Recent Topics 1)

36

Recent Topics 2<Highlights for FY10>
2010-4-1

AEGON Sony Life Insurance ’s variable individual annuity product commenced to be offered at Minato Bank
Sony Bank entered tie-up with Kintetsu Real Estate in mortgage loans

2010-4-12Sony Assurance launched automobile insurance sales via Bank of Yokohama

2010-4-19

AEGON Sony Life Insurance 's variable individual annuity product commenced to be offered at Fukushima Bank

2010-5-1

Sony Life newly opened a branch in Yamagata prefecture to expand its service network through community-based approach2010-6-24

Sony Bank opened the first over-the-counter branch, called "Housing Loan Plaza

2010-7-12

AEGON Sony Life Insurance 's variable Individual annuity product to be offered at Chiba Kogyo Bank

Sony Assurance launched automobile insurance sales via Tama Shinkin Bank
Sony Life commenced operations at LIPLA Co., Ltd., a wholly owned subsidiary of Sony Life, and opened the first one-stop shop “LIPLA”

2010-7-26

Sony Bank launched foreign currency delivery service

2010-9-13

Sony Bank began offering mortgage loans for used condominiums

2010-9-16

Sony Life opened the second one-stop insurance Shop, "LIPLA"

2010-10-4

Sony Bank entered tie-up with Ohkuraya Juutaku in mortgage loans

2010-11-2

Sony Life began offering new products: Whole life nursing-care insurance (reduced surrender value), lump- sum payment nursing-care rider,and discount rider for nonsmokers and others in excellent health for decreasing term life insurance

2010-11-08

Sony Bank began providing a service to accept dividends on investment trusts

2010-11-29

Sony Bank added six funds (monthly dividend type) to investment trusts lineup

2011-01-17

AEGON Sony Life Insurance began offering new variable individual annuity product, Catch Point, at SMBC

2010-01-24

Sony Bank added two funds (monthly dividend type) to its lineup of investment trusts. The bank began offering the COMMONS 30 FUND,

2010-02-01

AEGON Sony Life Insurance began offering new variable individual annuity product, W Account, throughSony Life's Lifeplanner sales employees and at Minato Bank

which previously was only sold directly by Commons Asset Management.

2010-02-01

Sony Assurance introduced several revisions to its automobile insurance products, including to insurance premiums and2011-02-07

AEGON Sony Life Insurance began offering new variable individual annuity product, W Account, at Juroku Bank

2011-3-19

Sony Life opened the third one-stop insurance shop, "LIPLA"

subdivisions of driving distance criteria.

2011-4-01

Sony Assurance declared conformity with the ISO 10002 International Standard for Complaints Management Systems

2011-4-01

Sony Bank began offering Wide Danshin group credit life insurance to mortgage loan borrowers

2011-4-11

AEGON Sony Life Insurance began offering new variable individual annuity product, W Account, at Kansai Urban Banking

2011-4-28

Sony Assurance began offering free application, “Trouble Navigation” to smart phone users

2011-5-01

Sony Bank to enter credit card business; began issuing the Sony Card.

2011-5-02

Sony Life began sales of new income protection insurance to cover three major diseases (type II)2011-5-16

Sony Bank began offering Brazilian real for foreign currency deposits

37(Recent Topics 2)

37

Sony 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)(Billions of yen)Valuation gains (losses) on trading-purpose securities(Billions of yen)

Notes:
1) Line item amounts are truncated below ¥100 million.
2) Amounts above include those categorized as “monetary trusts.

38(Sony Life: Fair Value Information on Securities)

38

Sony Life’s Breakdown of Net Assets
Net Assets on BS, Real Net Assets and Solvency Margin(Billions of yen)
①Net Assets(B/S)

10.3.31②RealNet Assets

11.3.3110.3.31③Solvency
Margin11.3.3110.3.3111.3.31

Total shareholders’ equity

177.3

209.8

177.3

209.8

170.3

200.7

Net unrealized gains on other securities, net of taxes

15.4
－
(1.4)

7.0
－
(1.4)

Reserve for possible loan losses

－
－
－

－
－
－

15.4
－
(1.4)
9.6
48.4
－

7.0
－
(1.4)
16.7
51.5
－

－
33.0
－
9.6
48.4
0.0

－
20.8
－
16.7
51.5
0.0

Net unrealized gains on real estate

－

－

2.6

1.9

1.6

1.0

－
－
－
－
－
－
191.3

－
－
－
－
－
－
215.3

316.5
2.3
－
－
(20.4)
12.8
563.4

334.2
1.1
－
－
(22.1)
8.0
606.9

316.5
2.3
1.0
47.2
－
－
630.2

334.2
1.1
0.6
63.3
－
－
690.3

Net unrealized gains (losses) on available-for-sale securities
Land revaluation, net of taxes
Reserve for price fluctuations
Contingency reserve

Excess amount of policy reserves based on Zillmer method
Unallotted portion of reserve for policyholders' dividends
Future profits
Deferred tax assets
Unrealized gains (losses) on held-to-maturity bonds
Deferred tax liabilities for available-for-sale securities
Total

Notes
③After estimateddistributed income
deducted③Before tax x 90%②Before tax（after revaluation）③Before tax(Before revaluation) X85%

②Before tax

Note: Real net assets excluding net unrealized gains (losses) on held-to-maturity securities and on policy reserve matching bonds, are¥583.8 billion as of March 31, 2010, and ¥629.1 billion as of March 31, 2011.

Amounts are truncated below ¥100 million.

39(Sony Life’s Breakdown of Net Assets)

39

Sony Life’s Solvency Margin Ratio(Billions of yen)
11.3.31(Currennt )Category

11.3.31
(New)
690.3

625.7

Common stocks, etc

200.7

200.7

Reserve for price fluctuations

16.7

16.7

Contingency reserve

51.5

51.5

Reserve for possible loan losses

0.0

0.0

20.8

20.8

Total solvency margin(A)

Net unrealized gains on other securities
multiplied by 90% if gains or 100% if losses
Net unrealized gains on real estate
multiplied by 85% if gains or 100% if losses

1.0

1.0

Excess amount of policy reserves based on Zillmer method

334.2

334.2

Unallotted portion of reserve for policyholders' dividends

1.1

1.1

Future profits

0.6

Deferred tax assets

63.3

Subordinated debt-

That portion of the excess amount of policy reserves based on
Zillmer method and subordinated debt that is not included in the margin

Insurance risk

(B)
R1

(63.9)

-

-

47.6

72.7

20.0

20.0

Deductible items

Total risk

63.3

Third-sector insurance risk

R8

7.2

7.2

Assumed interest rate risk

R2

11.5

27.9

Asset management risk

R3

16.8

28.7

Business management risk

R4

1.2

1.8

Minimum guarantee risk

R7

9.0

8.8

2,900.1%

1,720.0%

Solvency margin ratio [(A)/{(B)×1/2}]×100

Note: Cabinet Office Ordinance No. 23 of 2010 and FSA public ministerial announcement 48 of 2010 prescribe a revision in the methods of calculating
total solvency margin and total risk (increasing the strictness of margin inclusion, and making risk measurement stricter and more sensitive).
These changes are to be applied from FY11. The above-stated figures are calculated on the assumption that these changes are applied at the end of FY10.

Amounts are truncated below ¥100 million.

40(Sony Life’s Changes in Solvency Margin Ratio)

40

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

41(Contact)41