1

Profile
As moves to establish new banks that were more community-based gathered momentum,
the Chiba Kogyo Bank was founded in 1952 with the spirit of “acting as a reliable adviser tosmall- and medium-sized enterprises in Chiba Prefecture” and opened for business in Chiba
City, Chiba Prefecture.
By putting into practice its corporate philosophy of “Moving Forward with the Region, with
Heartfelt Kindness Toward Customers,” the Bank has gained trust from regional customers andhas promoted community-based finance rooted in the regional area and contributed to the
local economy and local society, striving to be “a bank that continues to be chosen, with anabsolute presence indispensable to the area and our customers.”

Corporate Outline (As of March 31, 2018)
Name:
Date of Establishment:
Head Office:

The Chiba Kogyo Bank, Ltd.
January 18, 1952 (Start of Business: March 3, 1952)
1-2, Saiwaicho 2-chome, Mihama-ku, Chiba 261-0001
Telephone: +81-43-243-2111
URL: https://www.chibakogyo-bank.co.jp
2-2, Saiwaicho 2-chome, Mihama-ku, Chiba 261-0001
Telephone: +81-43-243-0852
SWIFT Address: CHIK JP JT
Fax Number: +81-43-243-0235

Financial Market Division:

Network
Head Office and Branches:
Number of Employees:
Stock Exchange Listing:Paid-in Capital:
Number of Common Stock:
Number of Common Stock Shareholders:

74
1,348
1st Section of Tokyo Stock Exchange¥62,120 million
Authorized: 296,000 thousand shares
Issued and outstanding: 62,222,045 shares
11,446The Chiba Kogyo Bank, Ltd. is an affiliate under the equity method of Mizuho Financial Group, Inc.
Name
Mizuho Financial
Group, Inc.

Location

Business category

Capital(Millions ofyen)Founded

Percentage ofvoting rights of
the Bank

Chiyoda-ku,
Tokyo

Holding company for financial
service companies

2,256,548

Jan. 8, 2003

17.0%
(17.0%)

Note: Figures in parentheses in the column “Percentage of voting rights of the Bank” represent the Bank’s shares held bysubsidiaries of Mizuho Financial Group, Inc.

Contents
01
01
02
03
04
04
06

ProfileCorporate Outline
Chiba Prefecture – Our Business Base
Message from the President
Medium Term Management Plan
Business Highlights
Corporate Social Responsibility (CSR)

09
10
11
19
19
20
20

1

Summary of Selected Financial Data (Consolidated)
Business Performance (Consolidated)
Consolidated Financial Statements
Consolidated Subsidiaries
Organization Chart
Board of Directors, Corporate Auditors and Executive Officers
Major Shareholders (Common Stock)Chiba Prefecture – Our Business BaseIn addition, with the enhanced development of theTokyo Bay Aqua-Line Expressway (Trans-Tokyo Bay
Highway connecting Chiba Prefecture and Kanagawa
Prefecture) and the beltway connecting the core citiesof the Greater Tokyo Area, accessibility to themetropolitan center has been greatly improved, andthus the number of sightseeing visitors to Chiba
Prefecture is on an increasing trend. As preparations
advance for the Tokyo Olympics and Paralympics in
2020, Chiba Prefecture is a prospering market, and ispredicted to grow further in the future.

Chiba Prefecture, the Chiba Kogyo Bank’s businessbase, is located adjacent to Tokyo, and plays animportant role in the functions of the Greater Tokyo
Area.
Industry inside the prefecture is extremely active andwell-balanced, and the prefecture is in the top rank
nationally -- in agriculture, marine products, industrial
products, commercial trade and also gross prefectural
product. Chiba Prefecture is also home to many ofJapan’s preeminent facilities, including Makuhari
Messe, one of Japan’s largest convention facilities, andNarita International Airport.

Source: Oct.1.2017, Ministry of Internal Affairs and Communications, Mar.31.2018 Bank of Japan, Annual Report on Prefectural Accounts, 2014,
Cabinet Office, Statistics of Agricultural Income Produced, 2016, Production Statistics for the Fishing and Aquaculture industries, 2016,
Ministry of Agriculture, Forestry and Fisheries, Census of Manufactures 2016, Current Survey of Commerce 2017, Ministry of Economy,
Trade and Industry

2Message from the President

Shunichi Aoyagi
President (CEO)On this occasion, we have formulated the “Annual Report 2018,” which highlights the Bank’s management activities
and operating results for FY2017, and provides an overview of our CSR and other initiatives. We would be pleased if
stakeholders could take the time to peruse this document.
Chiba Prefecture, the basis for business of Chiba Kogyo Bank (the “Bank”), has been seeing a continual influx ofresidents, and as of FY2017, it is home to over 6.25 million people. Moreover, the prefecture has plenty of potential tosustain and increase its growth, amid a situation where it has been steadily developing its expressways and otherinfrastructure, and is also expected to reap economic benefits associated with the Tokyo Olympic and Paralympic
Games to be held two years from now.
However, the prospect of net interest income expansion seems unlikely given factors over the medium to long termthat include, in addition to the shrinking market due to Japan’s progressively falling birthrate and aging population, thecurrently continuing low interest rate environment.
Furthermore, whereas we anticipate excessive supply of financial products and services due to growing financial
competition, including that involving other business lines, it also seems likely that business challenges of theprefecture’s small and medium enterprises and individual customer needs will become increasingly diverse andsophisticated.
Amid that environment, the Bank has been steadily carrying out its Medium-Term Management Plan, “Consulting
Kodo Project 2019” for which FY2018 is the final fiscal year, and it has accordingly been making progress with its“Implementation of Consulting Kodo” customer-first concept geared to achieving the “Establishment as a Consulting
Bank” goal.
With respect to corporations and individual business owners, we have been actively drawing on our consulting
capabilities, in addition to carrying out our core business of financing of operational funds. This has entailed providing
support for business succession, promoting sales mediation and business matching, making use of idle properties,
providing assistance to deploy overseas operations, and supporting expansion of overseas sales channels, while
teaming up with external specialized organizations on the basis of understanding and analyzing business challenges
facing our customers.
As a result, we achieved our target for profit amid an increase in fees and commissions, and despite a decrease in
net interest income with respect to our customers during FY2017.
With the aims of expanding its customer base and supporting growth of local companies, the Bank will realize its“Establishment as a Consulting Bank” goal with everyone at the Chiba Kogyo Bank working as a team in meeting the
expectations of its shareholders, customers and everyone in the region.
I look forward to your further support in the future.

3

Medium Term Management Plan

Consulting Kodo Project 2019 (FY2016-2018)
The Bank has carried out numerous initiatives with the “Implementation of Consulting Kodo,” in which the customer
is considered first, as its core strategy.

Business Highlight
Initiatives for promotion of “regional regeneration” and community revitalization■ Cooperation toward realizing urban planning projects to enhance Sosa City’s version ofquality lifelong living
The Bank has been providing support for urban planning based on the Comprehensive Strategy for Sosa City:
Community, People and Work Creation.
In addition to providing financial support, the Bank also prepared a business plan encompassing multifacetedideas. This has involved operating a council for the project, taking part as a member, and also engaging in dialogue
with community members through council meetings over the span of one year.
Construction was completed on a certified center for early childhood education and care in March 2018, andthere are plans going forward to successively continue with new construction that will provide serviced housing for
elderly residents and facilities that act as community hubs.
The urban planning projects are expected to stem the decline of Sosa City’s population while creating new
business and jobs.

Support for agri-food businesses■ Support for the “Michi-no-Eki” (roadside rest area) revitalization project
The Bank gave its support with respect to revitalizing the Michi-no-Eki Shirahama-nojimazaki rest area situated in
Minamiboso City.
A direct sales outlet for agricultural products and other such items has been built, and a nearby greenhouse with
an elevated cultivation system has been set up, which offers visitors a pick-your-own method of purchasing
strawberries.
In addition to its backing with respect to capital expenditure, the Bank also provided support from the initial
phases of planning, in partnership with Minamiboso City.
The project greatly contributes to the local economy by helping to promote local agriculture.

Michi-no-Eki Shirahama-nojimazaki

4Assistance to deploy overseas operations■ “Chiba-kun Café in Taiwan” opened for a limited time
As one of the events to commemorate its 65-year anniversary since foundation, the Bank held an event to convey
the appeal of Chiba Prefecture to people in Taiwan and promote greater international tourism in Chiba Prefecture.
In addition to being an initiative to promote Chiba Prefecture tourism, the event was also used as a forum forengaging in public relations regarding the products and services of the Bank’s customer companies.

Support for business succession■ Received the “Regional Contribution Award” for the second consecutive year!
The Bank received the “Regional Contribution Award” for the second consecutive year at the “Sixth M&A Bank of
the Year Award Ceremony” held by Nihon M&A Center Inc., as recognition for its outstanding achievements in the
Kanto region.

Finｔech initiatives■ Partnership agreement on digitization strategy concluded among seven regional banks
The Bank and six other banks have concluded the “FinX Partnership” agreement. In June 25, 2018, a joint
investment company “FinX Digital Co., Ltd.” was established by the “FinX Partner” banks.
Under the partnership, the banks will work together to provide new services while working to not only digitalize
existing financial services, but also digitize the financial institutions themselves, particularly in terms of developing
artificial intelligence, adopting robotic process automation (RPA), going paperless, and eliminating back office
operations.

5Corporate Social Responsibility (CSR)

The Chiba Kogyo Bank’s CSR
Having established the corporate philosophy of “Moving Forward with the Region, with Heartfelt Kindness Toward
Customers,” the Bank takes a community-based approach to conducting its business activities on the basis of thecorporate philosophy with respect to its social responsibility as a regional financial institution that develops in stepwith its communities. In so doing, we aim to contribute to the growth and development of all our stakeholders, which
includes our customers, shareholders, employees and communities.
In recent years, there have been increasing efforts to address prevailing challenges on a global scale, in part byincorporating Sustainable Development Goals (SDGs) contained in the “2030 Agenda” which was adopted by the UN
General Assembly in 2015. Going forward, it is hoped that greater regional sustainability will be achieved from both anenvironmental and economic perspective.
Accordingly, given its aims of helping to bring about sustainable growth of communities and local economies while
also creating new forms of corporate value, the Bank will actively take on environmental, social and governance (ESG)
challenges as part of its “The Chiba Kogyo bank’s CSR” activities.
The Bank’s CSR initiatives are grouped on the basis of an ESG perspective, as follows:

Environment
Environmental initiatives■ Environmentally-sound bank branch design
We promote design of bank branches that are earth-friendly and readily accessible to all of our customers.
In order to help reduce carbon dioxide emissions while addressing global warming, renovated bank branches havebeen equipped with hybrid street lighting that uses two forms of clean energy, wind and solar, as well as solar power
generation systems (3.11kW generation capacity).

■ Environmental volunteer activities
Bank employees, staff and their family members have taken part in a prefectural-level “zero waste” campaign(approx. 1,000 participants).

■ Forest preservation and cultivation activity “Chiba Kogin Forest”
We engage in activities to regenerate prefectural forests at the Niibori coast of Sosa City. This has involved cutting
underbrush and planting 5,000 trees thus far.

6

SocialFinancial education activities■ “Summer Kids School 2017” summer camp
We held the “Summer Kids School” for the 11th time, for elementary school students in Chiba Prefecture. Children
attending learned about money and gained hands-on experience “working” at ZOZO Marine Stadium.

Human resources training and skills development■ Received “Good Career Company Award 2017” grand prize (award from Japan’s Minister of
Health, Labour and Welfare)This is the first time a regional bank has been awarded the grand prize.
The award showcases the Bank’s exemplary efforts to provide career support.

President & CEO Shunichi Aoyagi (center) at the awards ceremony

Initiatives geared to employee empowerment through diversity (As of Oct. 31,2017)■ Active promotion of women to managerial positions
The Bank has 225 female managers, which accounts for 27.4% of its overall managerial workforce. Also, women act
as branch managers at four of the Bank’s 74 branches.

■ Active placement of women to financing administration and lending services, and head
office operations
Given that we actively assign women to positions that involve financing administration and lending services, 44 of
our female employees currently handle such duties. Meanwhile, 98 women handle head office operations.

Community service activities■ Complimentary bicycle reflectors
We gave 30,000 complimentary bicycle reflectors to new junior high school students in Chiba Prefecture, and havegiven away a total of 316,000 such reflectors so far, over the last 24 years.

7GovernanceCorporate governance■Basic views
The Bank’s corporate governance framework enables us to make decisions in a manner that is transparent, fair,
expeditious, and resolute, upon having considered our shareholders, customers, officers and employees, community
members and other stakeholders.
We regard the matter of strengthening and enhancing the Bank’s corporate governance practices as one of our
key managerial challenges, knowing that we must effectively perform corporate governance in order to put the basic
values of our corporate philosophy into practice with respect to “Moving Forward with the Region, with Heartfelt
Kindness Toward Customers.”

Risk management■ Fundamental approach
The Bank regards the task of controlling risk as a key managerial challenge, and has accordingly established a risk
control framework appropriately tailored to the areas, scope and nature of risk inherent in banking operations.
Accordingly, our fundamental approach to controlling risk involves developing a more robust business platform
through efforts to maintain and improve the soundness of our management by accurately assessing risk andappropriately managing it.

Compliance
The Bank remains continually aware that banks bear substantial responsibility with respect to the public andsociety. As such, we believe compliance involves ensuring that “officers and bank employees observe laws andregulations, and accordingly carry out our business activities in a fair and honest manner adhering to societal
norms.”
Thus, we regard the matter of ensuring robust compliance as a fundamental principle of management, and haveaccordingly established a compliance framework that conforms with our “Basic Compliance Policy.”
Note: Refer to the section “Business Highlight” on pages 4 and 5 for details on our initiatives that involve drawing on
our business initiatives to address social challenges in terms of Japan’s falling birthrate and aging population,
population decline, and industrial development.

8

Summary of Selected Financial Data (Consolidated)
Fiscal year ended March 31

2014

2015

2016

2017

2018

¥52,555¥53,262¥53,884¥52,255¥50,525$475,440

11,864

13,182

12,566

9,322

9,489

89,291

8,555

8,442

7,901

6,388

6,771

63,715

7,960

19,785

1,174

3,631

7,934

74,659126,493

139,269

146,737

150,724

156,621

1,473,803

2,397,895

2,502,720

2,612,058

2,694,580

2,739,444

25,778,150

Consolidated ordinary income(Millions of yen)(Thousands of U.S. dollar)

Consolidated ordinary profit(Millions of yen)(Thousands of U.S. dollar)

Consolidated profit attributable toowners of parent(Millions of yen)(Thousands of U.S. dollar)

Consolidated comprehensive income(Millions of yen)(Thousands of U.S. dollar)

Consolidated net assets(Millions of yen)(Thousands of U.S. dollar)

Consolidated total assets(Millions of yen)(Thousands of U.S. dollar)

Net assets per share(Yen)(U.S. dollar)

1,289.27

1,635.99

1,449.71

1,465.62

1,554.72

14.63

Basic earnings per share(Yen)(U.S. dollar)

124.37127.46101.99

67.41

78.79

0.74

Diluted earnings per share(Yen)(U.S. dollar)

76.11

79.34

75.03

45.34

52.35

0.49

5.18

5.46

5.51

5.48

5.59

8.91

8.42

8.81

8.68

8.40

5.62

6.45

5.62

4.37

4.49

5.75

6.28

4.99

9.12

5.83

86,807

6,871

18,10823,856(19,686)(185,245)

19,288(16,538)

34,279(10,978)

14,263

134,215(67,456)(7,264)

6,231

273

(2,060)(19,385)¥71,626¥54,946¥113,766¥127,073¥119,772$1,127,054

1,371[1,115]

1,393[1,113]

1,422[1,106]

1,442[1,095]

1,461[1,057]

Capital adequacy ratio(%)

Consolidated capital adequacy ratio(under Japanese standards)(%)
Consolidated return on equity(%)

Consolidated price earnings ratio(Times)Cash flows from operating activities(Millions of yen)(Thousands of U.S. dollar)

Cash flows from investing activities(Millions of yen)(Thousands of U.S. dollar)

Cash flows from financing activities(Millions of yen)(Thousands of U.S. dollar)

Cash and cash equivalents at end of
period(Millions of yen)(Thousands of U.S. dollar)

Number of employees[Separately, average number of
temporary employees] (Persons)Notes: 1.
2.
3.
4.

U.S. dollar amounts are the yen equivalent, calculated, for convenience only, at a rate of ¥106.27 = U.S. $1, the approximate Tokyo
foreign exchange market rate as of March 30, 2018.
In the accounting treatment for consumption taxes and local taxes of the Bank and its consolidated subsidiaries, the tax-excluded
method is used with the exception of some consolidated subsidiaries.
Capital adequacy ratio is calculated by dividing (total net assets at the end of current period - subscription warrant at the end ofcurrent period - non-controlling interests at the end of current period) by total assets at the end of current period.
The “Consolidated capital adequacy ratio (under Japanese standards)” has been calculated based on the “Criteria for Banks to Judge
Whether Their Capital Adequacy Status Is Appropriate in Light of Their Assets, etc. Under Article 14-2 of the Banking Act” (Financial
Services Agency Public Notice No. 19 of 2006).

9

Business Performance (Consolidated)
In FY2017 the Japanese economy continued on a track of mild recovery amid factors that included ongoing
improvement in exports and corporate earnings underpinned by a strong global economy, along with signs ofconsumer spending also regaining momentum. However, the outlook remains unclear largely due to uncertainties withrespect to potential political developments of the U.S. and North Korea.
The economy of Chiba Prefecture, which forms the basis for the Bank’s business, showed signs of a mild recovery,
despite some partial weakness. It maintained low bankruptcy numbers and continued on an upward trend withrespect to employment.
Against this financial and economic backdrop, in April 2016, the Bank started the three-year Medium-Term
Management Plan, “Consulting Kodo Project 2019,” and has been actively carrying out specific strategic measures toovercome business challenges.
As a result, the Group’s performance for FY2017 was as follows.
From an operational standpoint, deposits totaled ¥2,437.9 billion, an increase of ¥47.4 billion compared with theend of FY2016, primarily due to an increase in individual deposits. Loans and bills discounted amounted to ¥2,053.4
billion, an increase of ¥63.7 billion compared with the end of FY2016, as a result of efforts to discover latent financing
needs through consulting sales activities, and proactive efforts toward financial needs of business partners. Securities
holdings amounted to ¥497.1 billion, down ¥18.5 billion from the end of FY2016.
From a profit and loss standpoint, ordinary income decreased ¥1.729 billion year on year to ¥50.525 billion due tosluggish interest income as a result of lower yields on loan interest, although fees and commissions increased
year-on-year largely stemming from strong sales of investment trusts. Meanwhile, ordinary expenses decreased ¥1.896
billion year on year to ¥41.036 billion, owing to a substantially diminished cost burden associated with disposal of
nonperforming loans. As a result, the Group posted ordinary profit of ¥9.489 billion, an increase of ¥166 million year
on year. Profit attributable to owners of parent increased ¥383 million year on year to ¥6.771 billion.
Business performance by segment was as follows. Ordinary income from banking business decreased ¥1.951 billion
year on year to ¥41.761 billion, while its segment profit increased ¥34 million to ¥8.424 billion. Ordinary income fromleasing business increased ¥144 million year on year to ¥8.323 billion, while its segment profit decreased ¥36 million
to ¥141 million. Ordinary income from credit guarantee and credit card business increased ¥32 million year on year to¥2.089 billion, while its segment profit increased ¥185 million to ¥1.162 billion. Ordinary income from other businesssegment decreased ¥6 million year on year to ¥2.467 billion, while its segment profit decreased ¥146 million to ¥96
million.
The consolidated capital adequacy ratio (under Japanese standards) at the end of FY2017 dropped 0.28 percentage
points from the end of FY2016 to 8.40%.

10

Consolidated Financial Statements(1) Consolidated Balance Sheets(Thousands of U.S.
dollars)*(Millions of yen)
As of March 31, 2017
AssetsCash and due from banks
Monetary claims bought
Trading account securities
Securities
Loans and bills discounted
Foreign exchanges
Other assets
Tangible fixed assets
Buildings, net
Land
Leased assets, net
Construction in progress
Other tangible fixed assets
Intangible fixed assets
SoftwareLeased assets
Other intangible fixed assets
Deferred tax assets
Customers’ liabilities for acceptances and guarantees
Allowance for loan losses¥128,541
131
44515,741
1,989,720
2,501
28,172
19,958
6,724
10,92345
25

As of March 31, 2018

As of March 31, 2018

¥120,519
103
69
497,174
2,053,457
3,107
33,93021,420
7,098
12,18767$1,134,083
969
649
4,678,404
19,323,017
29,237319,281
201,562
66,792
114,680
630

2,240
2,633
2,018
226
389
7,750
11,638(12,254)

－
2,066
2,622
2,062
170
388
6,281
11,951(11,193)－
19,441
24,673
19,4031,600
3,651
59,104112,459(105,326)

2,694,580

2,739,444

25,778,150

2,390,475
65,70017,23026,084
88
22,037
9,455
46
1,056
43
11,6382,543,856

2,437,904
65,00018,34624,35479
15,349
8,524
57
1,093
163
11,9512,582,823

22,940,661
611,650
172,636
229,171743
144,434
80,211536
10,285
1,534
112,459
24,304,347

62,1209,413
69,105(60)

62,1209,402
73,818(39)

584,549
88,473
694,627(367)

Total shareholders’ equity
Valuation difference on available-for-sale securities
Remeasurements of defined benefit plans

140,579
9,602(2,425)

145,301
9,996(1,974)

1,367,281
94,062(18,575)

Total accumulated other comprehensive income
Subscription warrant
Non-controlling interests

7,177
47
2,919

8,022
59
3,237

75,487555
30,460150,724¥2,694,580

156,621¥2,739,444

1,473,803$25,778,150

Total assets
Liabilities
Deposits
Negotiable certificates of deposit
Payables under securities lending transactions
Borrowed money
Foreign exchanges
Other liabilities
Net defined benefit liability
Provision for directors’ retirement benefits
Provision for reimbursement of deposits
Deferred tax liabilities
Acceptances and guarantees
Total liabilities
Net assets
Capital stock
Capital surplus
Retained earnings
Treasury shares

Total net assets
Total liabilities and net assets* Please refer to the note 1 on page 9.

11(2) Consolidated Statements of Income andConsolidated Statements of Comprehensive Income(Consolidated Statements of Income)(Thousands of U.S.
dollars)*(Millions of yen)
Fiscal year ended
March 31, 2017

Fiscal year ended
March 31, 2018

Fiscal year ended
March 31, 2018¥52,255¥50,525$475,440

28,82827,628259,979

Interest on loans and discounts

23,244

22,288

209,730

Interest and dividends on securities

5,084

5,031

47,342

Ordinary income
Interest income

Interest on call loans and bills bought

11

11

104

Interest on deposits with banks

242

144

1,355

Other interest income
Fees and commissions

245

152

1,430

9,314

10,312

97,036

Other ordinary income

3,101

1,461

13,748Other income

11,011

11,123

104,667

－

66

621

1,129

824

7,754

Other

9,881

10,231

96,274

Ordinary expenses

42,932

41,036386,148

1,098

1,185

11,151

755

619

5,825

Reversal of allowance for loan losses
Recoveries of written off claims

Interest expenses
Interest on deposits
Interest on negotiable certificates of deposit

7

7

66

Interest on call money and bills sold

10

(4)

(38)

Interest on payables under securities lendingtransactions

52

276

2,597

Interest on borrowings and rediscounts

261

279

2,625

Other interest expenses

10

6

56

Fees and commissions payments

3,104

3,494

32,879Other ordinary expenses

2,625

1,176

11,066

General and administrative expenses

25,80425,785

242,637

Other expenses

10,2999,393

88,388

1,082

－

－

Provision of allowance for loan losses
Other

9,216

9,393

88,388

Ordinary profit

9,322

9,489

89,291

2－－

Extraordinary income
Gain on disposal of non-current assets
Extraordinary loss

2

－

－

427

104

979

Loss on abandonment of non-current assets

91

55

518

Impairment loss

336

48

452

8,896

9,384

88,303

Income taxes - current

904

1,341

12,619

Income taxes - deferred

1,363

1,126

10,596

Total income taxes

2,268

2,467

23,214

Profit

6,628

6,917

65,089

240

145

1,364

¥6,388¥6,771$63,715

Profit before income taxes

Profit attributable to non-controlling interests
Profit attributable to owners of parent* Please refer to the note 1 on page 9.

12(Consolidated Statements of Comprehensive Income)(Thousands of U.S.
dollars)*(Millions of yen)
Fiscal year ended
March 31, 2017

Fiscal year ended
March 31, 2018

Fiscal year ended
March 31, 2018

¥6,628(2,996)¥6,9171,017$65,089
9,570

Valuation difference on available-for-sale securities(3,660)

566

5,326

Remeasurements of defined benefit plans, net of tax

664

451

4,244

¥3,631¥7,934$74,659

3,377

7,617

71,676

254

317

2,983

ProfitOther comprehensive income

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests* Please refer to the note 1 on page 9.

13(3) Consolidated Statements of Changes in Equity
Fiscal year ended March 31, 2017
(Millions of yen)
Shareholders’ equity
Capital surplus

62,1206,971Issuance of new shares

5,760

5,760

11,520Transfer to other capitalsurplus from capital stock(5,760)5,760－

Balance at beginning of current
periodRetained earnings

Total shareholders’equityCapital stock

Treasury shares

64,831(67)

133,856

Changes of items during period

Dividends of surplus(2,114)(2,114)

Profit attributable to ownersof parent

6,388

6,388

Purchase of treasury shares(9,075)(9,075)(2)

7

4(9,074)

9,074－

Disposal of treasury shares
Retirement of treasury shares
Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current period

－

2,442

4,273

6

6,723

62,1209,413

69,105(60)

140,579

Subscription
warrant

Non-controllinginterests

Total net assets

31

2,661

146,737

Accumulated other comprehensive income

Balance at beginning of current
periodValuationdifference on
available-forsale securities

Remeasurements ofdefined benefit
plans

Total
accumulated
othercomprehensive
income13,278(3,090)

10,188Changes of items during period
Issuance of new shares

11,520Transfer to other capitalsurplus from capital stock－

Dividends of surplus(2,114)

Profit attributable to ownersof parent

6,388

Purchase of treasury shares(9,075)

Disposal of treasury shares

4

Retirement of treasury shares－

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current period(3,675)664(3,011)16

258(2,736)(3,675)664(3,011)

16

258

3,987

9,602

(2,425)

7,177

47

2,919

150,724

14

Fiscal year ended March 31, 2018
(Millions of yen)
Shareholders’ equity

Balance at beginning of current
periodCapital stock

Capital surplus

62,1209,413

Retained earnings

Total shareholders’equityTreasury shares

69,105(60)

140,579

Changes of items during period
Dividends of surplus(2,059)(2,059)Profit attributable to ownersof parent

6,771

6,771

Purchase of treasury shares
Disposal of treasury shares(11)

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current period

(0)

(0)

21

10

－

(11)

4,712

20

4,722

62,1209,402

73,818(39)

145,301

Subscription
warrant

Non-controllinginterests

Total net assets

47

2,919

150,724

Accumulated other comprehensive income

Balance at beginning of current
periodValuationdifference on
available-forsale securities

Remeasurements ofdefined benefit
plans

Total
accumulated
othercomprehensive
income9,602(2,425)

7,177

Changes of items during period
Dividends of surplus(2,059)Profit attributable to ownersof parent

6,771

Purchase of treasury shares(0)

Disposal of treasury shares

10

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current period

393

451

845

12

317

1,175

393

451

845

12

317

5,897

9,996

(1,974)

8,022

59

3,237

156,621

15

Fiscal year ended March 31, 2018
(Thousands of U.S. dollars)*Shareholders’ equity

Balance at beginning of current
periodCapital stock

Capital surplus

584,549

88,576

Retained earnings

Total shareholders’equityTreasury shares

650,278(565)

1,322,847

Changes of items during period
Dividends of surplus(19,375)(19,375)

Profit attributable to ownersof parent

63,71563,715Purchase of treasury shares
Disposal of treasury shares(104)

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current period

(0)

(0)

198

94

－

(104)

44,340188

44,434

584,549

88,473

694,627(367)

1,367,281

Subscription
warrant

Non-controllinginterests

Total net assets

442

27,4681,418,312

Accumulated other comprehensive income
Valuationdifference on
available-forsale securities

Remeasurements ofdefined benefit
plans

Total
accumulated
othercomprehensive
income90,355(22,819)

67,536

Balance at beginning of current
periodChanges of items during period
Dividends of surplus(19,375)

Profit attributable to ownersof parent

63,715Purchase of treasury shares(0)

Disposal of treasury shares

94

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current period

3,698

4,244

7,951

113

2,983

11,057

3,698

4,244

7,951

113

2,983

55,491

94,062(18,575)

75,487555

30,4601,473,803* Please refer to the note 1 on page 9.

16

(4) Consolidated Statements of Cash Flows(Thousands of
U.S. dollars)*(Millions of yen)

Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment loss
Increase (decrease) in allowance for loan losses
Increase (decrease) in net defined benefit liability
Increase (decrease) in provision for directors’ retirement
benefits
Increase (decrease) in provision for reimbursement of deposits
Gain on fund management
Financing expenses
Loss (gain) related to securities
Foreign exchange losses (gains)
Loss (gain) on disposal of non-current assets
Net decrease (increase) in trading account securities
Net decrease (increase) in loans and bills discounted
Net increase (decrease) in deposit
Net increase (decrease) in negotiable certificates of deposit
Net increase (decrease) in borrowed money (excluding
subordinated borrowings)
Net decrease (increase) in deposit (excluding deposit paid toBank of Japan)
Net decrease (increase) in call loans
Net increase (decrease) in payables under securities lendingtransactions
Net decrease (increase) in foreign exchanges - assets
Net increase (decrease) in foreign exchanges - liabilities
Proceeds from fund management
Payments for finance
Other, net
Subtotal
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of securities
Proceeds from sales of securities
Proceeds from redemption of securities
Purchase of tangible fixed assets
Proceeds from sales of tangible fixed assets
Purchase of intangible assets
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from issuance of common shares
Purchase of treasury shares
Proceeds from sales of treasury shares
Cash dividends paid
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period* Please refer to the Note 1 on page 9.

17

Fiscal year ended
March 31, 2017

Fiscal year ended
March 31, 2018

Fiscal year ended
March 31, 2018

¥8,896
2,143
336
233
(1,106)¥9,3842,155
48(1,061)(931)$88,303
20,279452(9,984)(8,761)

(3)

11

104

19
(28,828)
1,098
(720)
(155)
89
108
(77,104)
52,1159,600

36(27,628)
1,185
(911)
(182)
55
(25)
(63,737)
47,428(700)

339(259,979)
11,151(8,573)(1,713)518(235)(599,765)
446,297(6,587)2,598(1,729)(16,270)

6,610

721

6,785

432

28

263

17,230

1,115

10,492

1,366
13
29,288(1,232)
1,309
24,340(484)
23,856(606)(8)
27,761(1,322)(10,144)(19,054)(631)(19,686)(5,702)(75)
261,231(12,440)(95,455)(179,298)(5,938)(185,245)(170,748)
95,736
66,214(1,459)19(740)(158,906)
84,23092,348(2,613)0(795)(1,495,304)
792,604
868,994(24,588)
0(7,481)(10,978)

14,263(134,215)

11,461(9,075)
1(2,114)273
155
13,306
113,766¥127,073－(0)0(2,059)(2,060)182(7,300)127,073¥119,772－(0)0(19,375)(19,385)
1,713
68,693
1,195,756$1,127,054

- Cash Flows
Cash flows during FY2017 and their causes are as follows.
Cash flows from operating activities
Net cash used in operating activities amounted to ¥19.6 billion (a decrease of ¥43.5 billion from ¥23.8 billion provided in
FY2016). The main contributory factors were ¥9.3 billion in profit before income taxes, an increase of ¥63.7 billion in loans and bills
discounted and an increase of ¥47.4 billion in deposit.

Cash flows from investing activities
Net cash provided by investing activities amounted to ¥14.2 billion (an increase of ¥25.2 billion from ¥10.9 billion used in
FY2016). The main contributory factors were ¥176.5 billion in proceeds from sales and redemption of securities, ¥158.9 billion inpurchase of securities and ¥2.6 billion in purchase of tangible fixed assets.

Cash flows from financing activities
Net cash used in financing activities amounted to ¥2.0 billion (a decrease of ¥2.3 billion from ¥0.2 billion provided in FY2016).
The main contributory factor was ¥2.0 billion in cash dividends paid.
As a result, cash and cash equivalents at the end of FY2017 amounted to ¥119.7 billion (a decrease of ¥7.3 billion year on year).

18

Consolidated Subsidiaries (As of March 31, 2018)
Chiba Kogin Card Service Co., Ltd.
Main business line:

Credit card business, guarantees of housing and other loans

Established:

April 1979

Capital:¥100 million

Equity share of the Bank and subsidiaries: 100.0%
Chiba Kogin Business Service Co., Ltd.
Main business line:

Clerical operations for the Bank

Established:

January 1986

Capital:¥10 million

Equity share of the Bank and subsidiaries: 100.0%
Chiba General Lease Co., Ltd.
Main business line:

Leasing, loans

Established:

December 1982

Capital:¥90 million

Equity share of the Bank and subsidiaries: 26.1%
Chiba Kogin Computer Soft Co., Ltd.
Main business line:

Development, sale and maintenance of computer systems

Established:

July 1991

Capital:¥30 million

Equity share of the Bank and subsidiaries: 55.0%

Organization Chart (As of June 30, 2018)
Risk Management Division
General Meeting of Shareholders

Board of Directors

General Secretariat
Compliance Committee

Management Planning Division

Governance Committee

Personnel DivisionTokyo Liaison Office
President (CEO)Deputy President (COO)
Senior Managing Director

General Administration Division
Management
Liaison Committee

Sales UnitManaging Director

Branch Promotion Division

Directors

Corporate Banking Strategy Division
Personal Banking Strategy Division
Personal Loan Division
Customer Service Promotion Division
Credit Supervision Division
Business Strategy Division
Treasury Division
Financial Markets Division
Business Procedures and Operations Division

Board of Corporate Auditors
Standing Corporate Auditors

Auditing DivisionCorporate Auditors

Office of Corporate Auditors

19

Board of Directors, Corporate Auditors and Executive Officers (As of June 27, 2018)
President (CEO):Shunichi Aoyagi

Deputy President (COO):

Ryuichi Matsumaru

Senior Managing Director:

Yoshiaki Tateno

Managing Director:

Hitoshi Umeda

Directors (Outside Directors):

Hisako Toya
Eiji Yamada

Managing Executive Officers:

Shigeto Katoh
Shigeki Ikeda
Yasumitsu Kanda
Hitoshi Yokoyama

Standing Corporate Auditors:

Kazuto Matsui
Satoshi Hoshino

Corporate Auditors (Outside Corporate Auditors):

Takahiro Itsukaichi
Masanori Ando

Executive Officers:

Yasuo Toda
Akio Shimoma
Katsumi Shirai
Hiroshi Tanaka
Takashi Furuyama
Kouichi Kyoumasu
Akira Miyamoto
Osamu Koda

Major Shareholders (Common Stock) (As of March 31, 2018)
Number of Shares
Owned

Proportion of Total Shares(%)

Mizuho Bank, Ltd.

9,583,910

15.41

The Master Trust Bank of Japan, Ltd. (trust account)

3,028,600

4.87

Japan Trustee Services Bank, Ltd. (trust account)

2,678,000

4.30

Sakamoto Feeds Co., Ltd.

1,249,700

2.00

Chase Manhattan Bank GTS Clients Account Escrow(Standing proxy: Mizuho Bank, Ltd., Settlement Sales
Department)

1,188,565

1.91

Meiji Yasuda Life Insurance Co.

1,158,200

1.86

DFA Intl Small Cap Value Portfolio(Standing proxy: Citibank, N.A., Tokyo Branch)

1,145,700

1.84Japan Trustee Services Bank, Ltd. (trust account-5)

1,034,300

1.66

Government of Norway(Standing proxy: Citibank, N.A., Tokyo Branch)

1,001,074

1.60

986,000

1.58

Name

Japan Trustee Services Bank, Ltd. (trust account-9)

Note: The proportion of the number of shares owned to total shares was calculated after deducting treasury shares (36,483 shares).

*This document follows the Annual Select format for English-language disclosure developed by ZAIHON, INC. to increase the level of convenience of investors outside Japan based onJapanese-language statutory disclosure material, timely disclosure material prescribed by securities exchanges and voluntarily disclosed IR material. Annual Select is a registeredtrademark of ZAIHON, INC. Reproduction or copying without prior permission is prohibited.

*

While every best effort has been made to provide a translation meeting the quality standards required of professionals, the Bank does not guarantee it is 100% accurate. Therefore,
please verify the original Japanese text for any final judgments made based on this information.

20