The long-term management plan, “Vision 2027: Plan for Creating the Future Together”

Create with Our Community, Customers and Employees
a Rich Future that We Can All ShareIn March 2017, we established our 10-year long-term management plan, “Vision 2027: Plan for Creating the Future Together.” Our aim with this plan is to build asustainable business model that can rise to meet the challenges presented by a shrinking population and other societal changes, and one that will enable everyone,
not just the Chugin Financial Group, but also the entire region, our customers, and employees to share in a prosperous future.
The current four-year medium-term management plan is StageIII of this long-term management plan.
FY 2 0 2 0 t o FY 2 0 2 2

S t ag e I I

B e ha v i o r a l C ha nge
St age I( S tr e n g th e n in g in ta n g ib le a s p e c ts )F Y 2 0 1 7 to FY 20 19

Strengthening our efforts in revitalization of regional economies and SDGs
⃝ Establishing a dedicated department and sustainability committee⃝ Promoting revitalization of regional economies together with regions andcustomers

S tr u c tu ra l R efo rms(S tr e ngth e n ta n gib le a s pe c ts )⃝ Secure personnel and time for sales activities
through thorough structural reforms (BPR PromotionProject)⃝ Launched Okayama Innovation Project and Okayama
Tech Planter⃝ Concluded Okayama Co-creation Partnership⃝ Transitioned to TSUBASA mission-critical system andjointly developed TSUBASA Fin Tech common
infrastructure⃝ Introduced flat meetings (invigorating internalcommunication)⃝ Introduced head office recruitment system“Deepening” the sales with customers first spirit⃝ Introducing Regional Headquarter System and self-imposed targets⃝ Deepening consulting sales business and acceleration of new businesses⃝ Established Group companies (regional trading companies, investment
specialists, staffing agencies, consulting)
Revitalization of organization⃝ “Major overhaul” to human resource system for the first time in 17-years⃝ Promoting diversity
Strengthening the digital strategies⃝ Accelerating digitalization of sales, administrative, and headquarters operations⃝ Launched Chugin App and Chugin Business Portal
Establishing a sustainable growth model⃝Controlling expenses, reorganizing branches, reallocating staff, etc.

KPI Review on Stage II
Stakeholders

KPIs

Targets for FY 2022

Results in FY 2022

Continuousimprovement

Continuous improvement

Regionalsocieties

Number of projects to address regional issues that
contributed to the SDGs
❶ Total of the number of start-ups for which we provided
support*1 and the number of companies for which weprovided support in business succession*2❷ Activities contributing to the improvement of financial
literacy, etc.*3

Total of three years
200 customers

Total of three years
222 customersContinuous
improvement

Total of three years 805 events
over 16,000 attendees

Continuous
improvement

Corporate Survey FY 2022 Customer satisfaction: 69%
Individual Survey FY2021 Customer satisfaction: 65%

54% or higher

44％¥15.0 billion
Remain stable at 12%¥20.4 billion
12.87%
3.79%

Customers
Employees
Shareholders,etc.
(all stakeholders)
*1
*2
*3
*4*5

11Customer satisfaction*4 (individuals and corporate)
Labor share in core business net profit before payment ofpersonnel expenses*5
Net income attributable to owners of parent
Consolidated capital adequacy ratio (Basel III)
Consolidated ROE―

Number of start-ups for which we provided support: Number of supported customers that started business through events for start-up support held by the Chugoku Bank
Number of companies for which we provided support in business succession: Number of entrusted contracts for business succession consulting services
Activities contributing to the improvement of financial literacy, etc.: Number of events and study meetings held for the improvement of financial literacy and business skills, etc.
Customer satisfaction: Number of answers indicating “Satisfied” or “Almost satisfied” in the customer questionnaires
Labor share in core business net profit before payment of personnel expenses: Personnel expenses divided by (core business net profit + personnel expenses)

CHUGIN FINANCIAL GROUP, INC.

S t ag e I I I
FY 2023 to FY 2026

D emo nstr ati n g the R e s ul t s a nd T a k i ng o n N e w C ha l l e nge s

Oct o b e r 2 022 - Tr an si t i on ed t o a h ol d i n gc omp an y st r u c t u r eStage I­II KPI
Reason for selection

Profitability
Capital efficiency
Soundness
Materiality

Environmental management
promotion
Revitalization of regional
economy and society
Response to low birthrate andaging society

Financial KPI

Net income attributable to owners of parent
ROE
Capital adequacy ratio
Growth strategy“Deepening” therevitalization ofregional economiesand SDGs

DX promotion

Creating innovation

Promotion of diverse humanresources

Strengthening ourGroup managementfoundation

Results in FY 2022

Targets for FY 2026

¥20.4 billion
12.87%¥30.0 billion
5% or higher
11% to 13%

Results in FY 2022

Targets for FY 2026

3.79%

Sustainability KPI

CO2 emissions reduction

Carbon neutrality by FY 2030*1

Cumulative execution amount of sustainable financing*2
Number of entrusted contracts for consultations*3
Number of owners of 5 products in custody andhousing loans
Number of inheritance-related projects*4
Business model transformation (operations, channels,and organizations)
Percentage of management/supervisory personnel thatare women (bank only)
Amount of human capital investment*5¥641.8 billion
256¥1 trillion
460

206,000

260,000487―800(Qualitativeassessment)

13.4%

25%

¥0.3 billion¥0.5 billion*1 Achieve net zero for Scope 1 (direct emissions from combustion consumption of gas, gasoline, light oil, etc.) and Scope 2 (indirect emissions from use of electricity, heat, etc., supplied by anothercompany) by the end of FY 2030
*2 Investment subjected is the execution amount from FY 2020 onward in social fields (medicine, nursing care, childcare, education, etc.), environmental fields (solar power, wind power, biomass power,EVs, etc.), and support for revitalization of regional economies and SDGs/ESG initiatives*3 Annual number of entrusted contracts of consulting project for business succession, environmental, and other consultation areas*4 Annual number of testamentary trusts, inheritance support, and similar projects*5 Amount of money invested in employees, such as training and education expenses, academic scholarship expenses, Chugin Open Lab activity expenses, and personnel expenses for taking training
and secondment

CHUGIN FINANCIAL GROUP, INC.

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