FY2021 Interim Financial Results
September 2021

December 2, 2021

Connecting people, local communities and future
st Section and NSE 1st Section (7380)
TSE 1東証一部・名証一部(7380)

Table of Contents
Section I: Interim Results for FY2021

Section III: First Management Plan

Bank

ＦＧ

Overview of results (9/2021)

4

Overview of the management plan

23

Transition of top line and expenses

5Group management philosophy

24

Net interest income and loans

6

Exerting the Group’s comprehensive capability

25

Fees and commissions

7

Management strategy

26

Securities investment

8① Market-in approach strategy

27-28

Expenses and adjusted OHR

9② DX strategy

29-30

Credit costs and bad debt balance10③ Local commitment strategy

31-32

Non-interest income ratio and profit

11

Main initiatives:

from customer services

Expanding business categories

Capital adequacy ratio and shareholder returnResponse to COVID-19

Business projection(non-consolidated and consolidated)

Section II: Initiatives for sustainability

35

12
13-14
FG

Promoting SDGs

16-18

Addressing climate change and

19-20

environmental issues

33-34

21

Promoting DX
Description of business projections and other future developments provided in this document is based on information currently available toJuroku Financial Group and some assumptions that is considered to be rational. Actual business performance, etc. could be significantly different
due to a variety of factors.

2Section I: Interim Results for FY2021(Juroku Bank)

Overview of results (to September 2021)
 The non-consolidated core gross operating profit has risen by 2.5 billion yen year-on-year to 32.9 billion yen due to the increase of net interest income,feeds & commissions and other operating profit (Excluding profit on JBGs and other debt securities).
 Both non-consolidated and consolidated operating profits have grown for four consecutive terms, with interim net income topping 10 billion yen.
(Unit: （単位:億円）
100 million yen)単体
Non-consolidated

2019/99/20192020/99/20202021/99/2021Year-on-Year
前年同期比

A

B

B－A

Core gross operating profit

Core gross operating profit
コア業務粗利益

321

304

329

25

Net
interest income
資金利益

267

255

268

13

53

45

55

10

0

4

5

1

214

207

197

△ 10

114

105

100

△5

85

85

80

△5

Core net operating profit
コア業務純益

106

97

131

34

Net business income
実質業務純益

105

111

135

24

Profitrelated to securities investment
有価証券関係損益

△1

39

14

△ 25

△1

14

3

△ 11

0

25

10

△ 15

Creditcosts
与信関係費用

17

27

19

△8

Ordinary
profit
経常利益

91

112

138

26

Interim net income
中間純利益

65

75

100

25

Fees
and commissions
役務取引等利益
Other
operating profit
その他業務利益（除く国債等債券損益）(Excluding profit on JBGs and other debt securities)

Expenses
経費
Personnel
expenses
うち人件費
Non-personnel expenses
うち物件費Profiton JGBs and other debt securities
国債等債券損益
Profiton equities
株式等関係損益(Unit:（単位:億円）
100 million yen)

Consolidated
連結2020/99/20202019/99/2019Ａ

2021/99/2021Year-on-Year
前年同期比

Ｂ

Ｂ－Ａ

Core gross operating profit
コア業務粗利益

356

345

378

33

Expenses
経費

243

240

231

△9

Core net operating profit
コア業務純益

113

104

146

42

Ordinary
profit
経常利益

96

118

150

32

Interimnet income attributable to owners of the parent
親会社株主に帰属する中間純利益
company

65

75

103

28

Increase due to expanded net
interest income and fees &commissions
Year-on-year difference(Non-consolidated) +2.5 billion yen(Consolidated) +3.3 billion yen

Expenses
Decline in personnel and nonpersonnel expenses
Year-on-year difference(Non-consolidated) △1 billion yen(Consolidated) △0.9 billion yen

Core net operating profit
Year-on-year difference(Non-consolidated) +3.4 billion yen(Consolidated) +4.2 billion yen

Interim net income
Progress in achieving projection(Non-consolidated) 64.5％(Consolidated) 64.3％

4

Transition of top line and expenses
 The core net operating profit has risen by 3.4 billion yen year-on-year to 13.1 billion yen due to the increase ofcore gross operating profit and decline in expenses.

Transition of core gross operating profit and expenses(Unit: 100 million yen)

19/9

20/9
Ａ

21/9
Ｂ

Core gross operating profit

321

304

Net interest income

267

Fees and commissions
Other operating profit (*)

Difference

Ｂ－Ａ

300

329

＋25

250

255

268

＋13

200

53

45

55

＋10

150

0

4

5

＋1

Expenses

214

207

197

△10

Core net operating profit

106

97

131

＋34

106

321

140

Loan
interest
△0

120

V:＋4
R:△4

Top-line growth: +25

Expenses: +10

0

97
80
20/9

20/9

21/9

Core net operating profit (annual)

250
200
150

V:△０
R:+1

+34

197

50

300

NonOther operating
personnel
profitPersonnel expenses
Fees and＋1
Securities
expensescommissions+5
interest+5＋10
Other net
＋9
Depositinterest
interest
＋2
Ｖ: ＋9
+1
Ｒ: ＋0

100

207

(億円)million yen)
(100

Factor and transition of core net operating profit
Approx. 30%

329

304
214

100

131

97

19/9

Approx. 70%

経費（中間）
Expenses(interim)(Core net
operating profit)*Excluding profit on JBGs and other debt securities(100 million yen)Core gross operating
コア業務粗利益（中間）profit (interim)(100 million yen)
350

131

100

205

215

20/3

21/3

253

147
50

V: Balance factor
R: Yield factor

105

101

17/3

18/3

0
21/9

19/3

22/3

(Plan)(計画）

5

Net interest income and loans
 The average balance of JPY loans has transitioned firmly, rising by 110.3 billion yen year-on-year to 4,481.2 billion yen.

Breakdown of net interest income(100 million yen)

(Unit: 100 million yen)

20/9
Ａ

19/9

21/9
Ｂ

Interest
income in foreign currencies
外貨資金利益

250

20
1

200

255

268

＋13

Interest income in JPY

247

234

245

＋11

JPY loans and deposits

188

188

190

＋2

150

JPY securities
investment

57

44

51

＋7

100

Others

1

3

4

＋1

50

20

20

23

＋3

0

Interest income inforeign currencies

Otherinterest income in JPY
その他円貨資金利益

267

267

Net interest income

円貨有価証券利息配当金
JPY
securities investment

300

Difference

Ｂ－Ａ

円貨預貸金利息収支
JPY
loans and deposits

57

255
20
3
44

268
23
4
51

188

188

190

19/9

20/9

21/9

(100 million yen)

Average balance and yield of JPY loans(Unit: 100 million yen, ％)

19/9

20/9
Ａ

21/9
Ｂ

Difference

Ｂ－Ａ

48,00042,61643,70944,812＋1,1030.894△0.0240.870

円貨貸出金平均利回り
Average yield of JPY loans△0.018

0.852

1.400
(%)
1.200
1.000
0.800

46,00044,000

Average balance of JPY
loans

Averagebalance
円貨貸出金平残of JPY loans

50,00044,812
43,709

0.600
0.400
0.200

42,6160.000

42,000-0.200-0.400

Average yield of JPY loans

0.894

0.870

0.852

△0.01840,000-0.600-0.80038,000-1.000
19/9

20/9

21/9

6

Fees and commissions
 Fees and commissions have risen by 1 billion yen year-on-year to 5.5 billion yen due to a significant increase ofindividual-related revenues year-on-year by 1.1 billion yen to 3 billion yen.

Breakdown of fees and commissions
Individual預り資産関連(Unit: 100 million yen)

19/9
Juroku Bank
Individual-related

Corporate-related
OthersJuroku TT Securities(Juroku Bank + Juroku TT
Securities)

53
25

7
20
5
(58)

20/9
Ａ
45
19

8
17
11
(56)

21/9
Ｂ

(100 million yen)80

Difference

Ｂ－Ａ

70

30

＋11

50

＋1

40

20

30

7

17
(72)

△2
＋6

10

(＋16)

20/9
Ａ

21/9
Ｂ

761

883

930

+47

424

△6

287

430

Difference

B－A

Private placement bond
fees

148

150

117

△33

M&A fees

88

157

154

△3

Business matching fees

237

145

234

+89

17
55

45

15

17

9

8
25

30
19

0
19/9

19/9

11

53

20

1,200
(Unit: Million yen) (Million yen)

Syndicated loans andcommitment fees

5

60

15

その他
Others

預り資産関連収益<Juroku TT ＜十六TT証券＞
Securities> Individual-related
revenues＋10

9

法人ソリューション関連
Corporate-relatedJune2019 – Operation launch
2019年6月~営業開始

55

Corporate solution-related revenues

Corporate solution-related
revenues

relatedビジネスマッチング手数料
Business matching fees
M&A手数料
M&A fees
私募債手数料
Private placement bond fees
シ・ローン手数料+コミットメントフィー等
Syndicated loans and commitment fees

1,000
800
600
400
200

20/9

883
761

145

21/9

930
234

237

157

88

150

117

430

424

20/9

21/9

154

148
287

0
19/9

7

Securities investment
 Valuation of securities has gained by 17.3 billion yen year-on-year to 93.2 billion yen due to the increase of valuation for stocks.

Average balance and yield of securities investment

Foreigncurrencies

JPY(Unit: 100 million yen, ％)
19/9

20/9
Ａ

21/9
Ｂ

Difference
Ｂ－Ａ

Average balance

10,313

10,813

12,413+1,600

Yield

1.109

0.811

0.833

+0.022Average balance

2,683

2,458

2,747

+289

Yield

2.174

1.570

1.540

△0.030JPY
securities – Average balance
円貨有価証券平残(億円)(100
million yen)
2.174

20,000円貨有価証券利回り
JPY
securities – Yield

1.109

15,000Foreign currency securities –
外貨有価証券平残
Averagebalance
Foreign currency securities –
外貨有価証券利回り
Yield

1.570

1.540

(%)
2.0

0.811

0.833

1.0
0.0

10,000
5,000

2,683

(1.0)

12,413

10,813

10,313

(2.0)
2,458

2,747

0

19/9

Valuation gains and losses of securities
19/9

20/9
Ａ

(3.0)

(Unit: 100 million yen)(100 million yen)

21/9
Ｂ

1,100

Difference

Ｂ－Ａ

Bonds

74

24

23

△1

Stocks

676

670

931

+261

Other securities

106

64

△23

△87

Total

856

759

932

+173

Bonds
債券

856
700

300

20/9

106

676

Stocks株式

21/9

Others
その他

932

759
64
931
670

74

24

23
△ 23

19/9

20/9

21/9

△ 100
(Year)

Bond duration

8.0

19/9

20/9
Ａ

21/9
Ｂ

6.93

Difference

6.85

Ｂ－Ａ

JPY bonds

5.35

6.93

6.85

△0.08

Foreign currency
bonds

5.01

5.65

5.61

△0.04

*Excluding derivatives, and including JPY bonds for held-to-maturity purposes
and for other retaining purposes

6.0

4.0

JPY
bonds
円貨債券
Foreign
外貨債券
currency bonds

5.35

5.01

19/9

5.65

5.61

20/9

21/9

8

Expenses and adjusted OHR
 The adjusted OHR has improved by 8.14 percentage points year-on-year to 59.90% (non-consolidated) andby 8.52 percentage points year-on-year to 61.20% (consolidated).
(100 million(100yen)million yen)

(Unit: 100 million yen)

Expenses

20/9
Ａ

19/9

Expenses214

Personnel
expenses

114

21/9
Ｂ

207
105

Difference
Ｂ－Ａ

300

△10

250

197

△5

100

200

85

85

80

△5

150

Taxes

14

15

15

0

100

 Retirement benefits Workforce size

Transitionin main non-personnel expenses
 Employee welfare Depreciation
 FG establishment-related

△2.0
△2.7

50

△3.3
△1.4
＋1.2

Consolidated

Nonconsolidated

Adjusted OHR

19/9

20/9
Ａ

21/9
Ｂ

321

304

329

＋25

Expenses

214

207

197

△10

66.82

68.04

59.90

△8.14

Adjusted OHR

226
15

95
88

140

356

345

378

＋33

Expenses

243

240

231

△9

68.31

69.72

61.20

△8.52

214

14
85

207

197

15

15

85

80

123

114

105

100

18/9

19/9

20/9

21/9

87.84

Adjusted
OHR
修正OHR(単体)(non-consolidated)

85.00
85.72

Adjusted
OHR
修正OHR(連結)(consolidated)

76.54

75.00
76.52

Core grossoperating profit

Adjusted OHR

16

17/9

Difference
Ｂ－ＡCore grossoperating profit

税金
Taxes

0

(%)

(Unit: 100 million yen, ％)Non-personnel
物件費
expenses

expenses251

Non-personnel
expenses

Transitionin main personnel expenses

Personnel
人件費

68.31

69.72
△8.52

65.00

66.82

68.04

61.20

△8.14
59.90

55.00
17/9

18/9

19/9

20/9

21/9

9

Credit costs and bad debt balance Credit costs have decreased by 800 million yen year-on-year to 1.9 billion yen due to a low level of bankruptcies
despite the year-on-year increase of net transfer to general allowance for loan losses by 1.1 billion yen.

Credit costs(Unit: 100 million yen)
20/9
Ａ

19/9
① Net transfer to general allowance forloan losses△0② Disposal of non-performing loans

17

Transfer to individual allowance for loan
losses21/9
Ｂ
4

Difference
Ｂ－Ａ

15(100 million yen)
30

4Disposal of non不良債権処理額
performing loans

27

+11
20

22

Net transfer to general
一般貸倒引当金繰入額
allowance
for loan losses

19

17

△18

4

22

15

21

3

△18

③ Reversal of allowance for loan losses

―

―

―

―

④ Recoveries of written-off claims

0

0

―

0

Credit costs ①+②－③－④

17

27

19

△8

10

19/9

20/9
Ａ

21/9
Ｂ

Difference
Ｂ－Ａ

Bankrupt and substantially bankrupt
claims

141

132

107

△25

19/9

Doubtful claims

480

514

561

+47

Substandard claims

22

30

29

△1

Total

642

677

697

+20

Ratio against total claims outstanding

1.45

1.49

1.50

+0.01

20/9

21/9

Bankrupt
and substantially bankrupt
破産更生債権およびこれらに準ずる債権
claims
要管理債権
Substandard
claimsDoubtful
危険債権 claims

1000
(億円)
(100 million yen)

1.45

800
600
400

15

+11
4

0

Outstanding non-performing loans(Unit: 100 million yen, %)

17

642
22

480

1.49
677
30

Ratio
against total claims
総与信に占める割合
outstanding
(％)
1.50

1.50

697
29
1.00

514

561
0.50

200
0

141

132

107

19/9

20/9

21/9

0.00

10

Non-interest income ratio and profit from customer services
 The consolidated non-interest income ratio has climbed by 2.56 percentage points year-on-year to steadily approach
the numerical target of 30% and above.

Non-interest income ratio*
20/9
Ａ

Consoli
dated

Nonconsoli
dated

19/9
Non-interest income
Non-interest income ratio

21/9
Ｂ

(100
200 million yen)
24.65

Difference

Ｂ－Ａ

53

49

60

+11

16.65

16.14

18.41

+2.27

Non-interest income

Non-interest income ratio(Unit: 100 million yen, ％)Non-interest
income (non非金利収益比率（単体）consolidated)
Non-interest
income ratio
非金利収益比率（単体）2(non-consolidated)

90

92

111

+19

25.39

26.88

29.44

+2.56

23.78

Non-interest
income (consolidated)
非金利収益比率（連結）

非金利収益比率（連結）2
Non-interest
income ration (consolidated)

25.39

29.44

26.88

30.0

Consolidated
numerical
連結計数目標:30%以上
target: 30% and above

150

16.63
100

16.65
15.41

18.41

16.14

10.0

92

90

0.0

78

50
47

45

17/9

18/9

60

53

49

19/9

20/9

(10.0)

0

Profit from customer services(Unit: 100 million yen, ％)(20.0)(100 million yen)
60

20/9
Ａ

19/9
Profit from customer services

21/9
Ｂ

20.0

111
78

*Non-interest income ratio
The ratio of “fees and commissions” and “other operating profit excluding profit
on JGBs and other debt securities” against the core gross operating profit

(%)

21/9

Profit of customer services = Average loan balance x Depositloan interest rate difference + Fees & commissions – Operating
expenses

Difference

Ｂ－Ａ

32

31

59

+28

Average loan balance× Deposit-loan interest rate
difference

193

191

192

+1

Deposit-loan interest
rate difference

0.896

0.868

0.850

△0.018Fees and commissions

53

45

55

+10

Operating expenses

213

205

188

△17

40

+28
20

32

31

19/9

20/9

59

11
0
△ 18
△ 20
17/9

18/9

21/9

11

Capital adequacy ratio and shareholder return The non-consolidated capital adequacy ratio is at 9.28%, and the consolidated capital adequacy ratio is at 9.87%.
 The interim dividend has been increased by 15 yen to 50 yen, and the Juroku Financial Group’s end-of-year
dividend is projected to be 50 yen.

Capital adequacy ratio(Unit: ％)19/9
Nonconsolidated
Consolidated

8.59
9.18

20/3
8.71
9.27

20/9
9.05
9.65

Capital adequacy ratio
Capital adequacy ratio
自己資本比率(単体)
自己資本比率(連結)(consolidated)(non-consolidated)
At the consolidated launch 十六ＦＧ連結開始時
of the Juroku FG (*)
10.30

(%)

21/3
Ａ

21/9
Ｂ

Difference
Ｂ－Ａ

9.35

9.28

△0.07

9.87

△0.06

9.93

11.00

9.18

(*) With the introduction of the holding-company structure, subsidiaries’ shares worth 13.4 billion yen, heldby Juroku Bank, were transferred to the Juroku Financial Group, causing a drop in the capital
adequacy ratio. Note that the consolidated capital adequacy ratio at the time of launching theconsolidated group led by the Juroku Financial Group was calculated at 10.30% and hassince been steadily increasing.

9.93

9.65

10.00

9.00

9.35

9.28

21/3

21/9

9.05
8.00

8.59

8.71

19/9

20/3

7.00
20/9

19/3

20/3

21/3

22/3

70 yen80 yen90 yen

100 yenInterimOrdinary
dividend

35 yen35 yen35 yen50 yenEnd-of-year

Ordinary
dividend

35 yenOthers

22/3(projection)（予想）

Dividends
Annual dividends

9.87

9.27

Total
配当金総額
dividends

(百万円)
5,000
(millionyen)
24.5

45 yen

10 yen

10 yen(Special
dividend)(Commemorative
dividend)

50 yen(Projection)* The end-of-year divided in 3/2022 will be issued by the Juroku Financial Group.
〇 Juroku Financial Group’s shareholder return policy
The Juroku Financial Group’s basic policy is to pay stable dividends continuously while striving to further
improve its fiscal robustness. In view of business management conditions and income level, the Group
determines shareholder return details aims to achieve the total payout ratio of at least 25%.

23.2

(％)
30

22.8

4,000
20

記念配当 dividend
Commemorative

Specialdividend
特別配当

3,000

35 yenTotal payout ratio
総還元性向（連結）(consolidated)

10

2,000

1,000

2,615

2,989

3,363

3,738

0
-10

0

-20

19/3

20/3

21/3

22/3
（予想）
(projection)

12

Business projection (bank-only, non-consolidated) The core net operating profit for the financial year ending in March 2022 is projected to be 25.3 billion yen, up 3.8 billion
yen year-on-year, while the net profit for the year is projected to be 15.5 billion yen, up 1.4 billion yen year-on-year.

2021/33/2021(actual)（実績）（単位:億円）(Unit: 100
million yen)2022/33/2022Difference
前期比(projection)（予 想）

コア業務粗利益Core gross operating profit

622

653

31

資金利益
Net interest income

508

538

30

役務取引等利益
Fees and commissions

98

104

6

Other operating profit (Excluding profit on
その他業務利益(除く国債等債券損益)

15

11

△4

407

400

△7

Personnel expenses
うち人件費

209

198

△ 11

Non-personnel expenses
うち物件費

170

173

3

Core net operating profit
コア業務純益

215

253

38

Net business income
与信関係費用41

50

9Profit related to securities investment
有価証券関係損益

45

5

△ 40

Profit on JGBs and other debt securities
国債等債券損益

0△3△3Profit on equities
株式等関係損益

45

8

△ 37

Ordinary profit
経常利益

225

230

5

Net profit
当期純利益

141

155

14

JBGs and other debt securities)

経費
Expenses(Unit: 100 million yen)
20/3
InterimCredit costs

17

22/3
(projection)

21/3

Annual35

Interim
27

Annual41

Interim
19

Annual(50)

Factor and transitionof core net operating profit
コア業務純益の増減要因(100 million yen)

280

Management guidancefee payable to FG △7

Fees andcommissions Personnel Nonpersonnel Others+6
expenses△5
expenses
Other net
+11
△3
Securities interest+16
interest
Deposit+15
Loan interest
interest
+1
V:+11
△3
R:＋3
Return of personnel
V:△0
expenses from FG (forR:＋1employees on loan)＋3
V:+7
R:△10

260

240

220

253

+38
200

215

V: Balance factor
R: Yield factor

180
21/3

22/3
（予想）
(projection)(100 million yen)

60
50
40
30
20
10
0

与信関係費用（中間）Creditcosts (interim)

与信関係費用（通期）Credit costs (annual)
50

35
17
20/3

41
27
21/3

Conservative(予想)(projection)
保守的に見積り19
22/3

estimate

13

Business projection (consolidated) The consolidated core net operating profit for the March 2022 term is expected to reach 28.3 billion yen, up 4.5 billion
yen year-on-year, while the net profit attributable to shareholders of the parent is projected to grow by 1.3 billion yen
year-on-year to 16 billion yen.
(Unit: 100 million
yen)（単位:億円）
2021/3（実績）
3/2021 (actual)

Credit rating
by Japan Credit Rating Agency (JCR)

Difference
前期比2022/3（予想）3/2022(projection)
Other
その他子会社
subsidiaries

consolidated
連結（連結）(consolidated)

653

112

751

39

505

538

0

535

62

155

104

66

15

40

51

11

Expenses
経費

407

75

474

Personnel
うち人件費expenses

209

46

コア業務純益Core net operating profit

215

Net与信関係費用
business income
Profitrelated to securities investment
有価証券関係損益

JurokuRated company

Juroku FG

30

Long-term issuer

Ａ+

Ａ→Ａ+

164

9

rating(New)(Upgrade)

45

51

0

400

80

468

△6

Rating outlook

StableStable

255

198

48

250

△5

29

238

253

31

283

45

41

1

42

50

5

55

13

45

0

45

5

0

2

△ 43

経常利益
Ordinary profit

225

28

246

230

26

247

1

Net profit attributable to shareholders of
親会社株主に帰属する当期純利益
the parent company

141

19

147

155

17

160

13

十六銀行
JurokuBank

Other
その他子会社
subsidiaries

consolidated
連結Core gross operating profit
コア業務粗利益

622

105

712

Net資金利益interest income508

2

役務取引等利益Fees
and commissions

98

Other
operating profit (*)
その他業務利益（※）

十六銀行
JurokuBank*Excluding
profit on JGBs and other debt securities※国債等債券損益を除く
(億円)
(100
million yen)
300

Factor and transition of consolidated core net operating profit

280
9
Fees andcommissions

260
30

0
Other operating
profit (excluding
profit on JGBs andother debt securities)

6
Expenses

283

+45

240
238

Net
interest

220
21/3

22/3

Rating dateBank

October 1, 2021

Selective application
for the new “RN Prime Index”
The Juroku FG has received confirmation fromthe Tokyo Stock Exchange that it meets thecriteria for maintaining listing on the Prime
Market based on the “results of primaryassessment for compliance with listing
maintenance criteria for the new market
category.”
Accordingly, the Juroku FG has decided tochoose the new Prime Market category andapply with the Tokyo Stock Exchange for listing.
In the future, the Group will follow the schedule
set by the TSE in proceeding with the required
procedure for selective application for the newmarket category.

(Note) The above consolidated business projection includes the interim consolidated results of Juroku Bank, which has become a whollyowned subsidiary. Consolidated results to be cited for comparison for the March 2021 term are the consolidated results of Juroku Bank.

14

Section II: Initiatives for sustainability

Promoting SDGs ①
 The Juroku Financial Group has issued its SDGs Declaration upon establishment, setting out five key
challenges (materiality) and promoting initiatives in line with the declaration.

Juroku Financial Group

SDGs Declaration
The Juroku Financial Group’s mission is to deepen our ties with the the local community andcreate a rich and livable community. To this end, we are working on creating a sustainable society
as a general financial group that is committed to creating a future with and for the local community
and achieving a sustainable growth together.

Key challenges (materiality)
Revitalization of
the local economy

Tapping into the Group’s management
resources in offering a wide range offinancial services, thereby helping local
companies grow and the local economy
to revitalize

Sustainable
development of thelocal community

Utilizing local resources andcollaborating with local councils
in creating new value for the next
generations and creating a
comfortable and appealing
community

Empowerment ofdiverse humanresources

Promoting diversity and work stylereforms to create a workplaceenvironment that empowers diverse
human resources and gives them asense of fulfillment

Environmental
conservation andclimate change actions

Striving to reduce the environmental
impact and implementing conservation
activities, while promoting the use ofrenewable energies through businessactivities to address climate change

Advanced governance

Advancing governance and reinforcing
the compliance system to establish asound and transparent management
structure

Connecting people, local communities and future

The 2nd SDGs Festival in Nagoya Marunouchi
The Juroku FG joined Aichi Prefecture andthe City of Nagoya in co-sponsoring the 2nd
SDGs Festival in Nagoya Marunouchi,organized by Tokio Marine & Nichido Fire
Insurance Co., Ltd. And held in November
2021.The event featured a panel exhibition
on corporate SDGs initiatives and displayof students’ SDG-related presentations inorder to build the momentum for achieving
SDGs.

Leading member of the “Seiryu-no-Kuni Gifu”
SDGs promotion network
In October 2021, The ”Seiryu-no-Kuni Gifu” SDGs promotion network,
run by Gifu Prefecture, recognized Juroku Bank as a leading member
for its outstanding efforts to achieve SDGs and the role it plays as thedriver for promoting the cause.
As the only leading member as afinancial institution based in Gifu
Prefecture, Juroku Bank is working
with the Gifu Prefectural
government in actively spreading
information about SDGs anddeploying initiatives for solving
local issues.

16Promoting SDGs ②
 On July 1, 2021, the Juroku SDGs – ESG Finance scheme was launched.
 It offers seven products of different characteristics according to fund usages and fundraising formats tofinancially assist business clients for their SDGs – ESG initiatives.

Juroku SDGs – ESG FinanceIn disclosing SDGs- and ESG-related activities as a framework,
this scheme obtains a second opinion from the Rating andInvestment Information, Inc. (R&I) as an external organization.
The mechanism allows business clients to present its active
involvement in and stance toward environmental and social
issues to the broad society and business associates in theprocess of raising funding.

Schematic diagram(1)Applying for SDGs – ESG financing

Business clients[Needs](7) Supplying fund[Roles]Juroku Bank

 Providing fund associated with businessclients’ SDGs – ESG initiatives
 Assisting business clients in establishing aframework for disclosing SDGs – ESG
initiatives(2) Screening(8) Monitoring during
the term

Raising fund associated with
SDGs – ESG initiatives
Communicating their SDGs - ESG
initiatives toward the broader
communities and stakeholders
Issuing grants(3) Assisting theestablishment of a framework(5) Interviewing and evaluating SDGs– ESG
initiatives(6) Providing second opinion

Applying for grants

Ministry of theEnvironment, etc.
(4) Referring business clients

External organization[Roles] Providing a second opinion about theframework established by business clients• Assisting grant applications*• Conducting monitoring during the term after
execution**Not for all financing contracts

Number of cases (as of the end of November)
Sustainability Link Loan

２ cases

Green Loan

１ caseA “Juroku Sustainability Link Loan” agreement was signedwith Mino Industry Co., Ltd. (Nakatsugawa-shi, Gifu) as
Juroku Bank’s first sustainable finance case in Gifu
Prefecture.
Mino Industry is building a new head office – factorycomplex (due to be completed in the summer of 2022) tointroduce next-generation technologies for electricmotorization and automatic-driving. In obtaining the
Sustainability Link Loan, the company set Sustainability
Performance Targets (SPTs) in relation to SDGs and ESG
in an effort to promotesustainability-oriented
business management
while motivating its
workforce towardachieving the targets.

17

Promoting SDGs ③

Supporting the use of diverse human resources and work styles that facilitate positive work-life balance
Ensuring the Board of Directors’ independence and diversity to achieve an advanced level of group governance

Ensuring diversity in core human resources
Promoting women’s empowerment and ensuring diversity throughmid-term recruitment of core human resources, recruitment of
non-Japanese people and their promotion.

HR development and work style support
Initiatives for diverse HR development
and work style support

Month / Year

Offering support programs for employees on parenting leave

April 2016

TargetAchievement

Introducing a half-day annual leave system

April 2016

Increase the ratio of women in leaders and higher
managerial positions by 1.5 times (21%) from the level
recorded as of the end of March 2020

１５.６％
(as of the end of March
2021)

Introducing a retired-employee reinstatement
system (Job Return program)

April 2016

Ensuring that at least 90% of eligible men claim spousalmaternity leave or parenting leave in each of the fiscal
years subject to the management plan

９１.５％
(actual figure for FY2020)

Establishing an in-house childcare facility “Juroku
Smile Room”

April 2016

Creating a spousal maternity leave system

April 2017

Creating an hourly nursing / long-term-care leave system

April 2017

Providing reskilling training

March 2021

Evaluation of women’s empowerment initiatives

Month / Year

Excellence in promoting work-life balance (Gifu Prefecture)

February 2016

“Eruboshi” certification under the Act on the Promotion of
Female Participation and Career Advancement in the
Workforce

April 2016

”We Hug Gifu” women’s empowerment company

Recruitment category
Mid-year recruitment(including former employees of the now-defunct
Gifu Bank following merger)

Non-Japanese recruits

Ensuring the independence and diversity of the Board of Directors

February 2020

Recruits

Ensuring that at least one-third of the board are independent outside
directors (4 out of 11) including at least 2 women for independence
and diversity
Inside directors (7)Outside directors (4)362 (as of the end of March 2021)
5 (as of the end of March 2021)

18

Addressing climate change and environmental issues ①
 Declaring endorsement for TCFD recommendations on June 11, 2021
 Commencing the use of CO2-free electricity, produced in Gifu, at the head office building on November 1, 2021
in order to reduce CO2 emissions
Declaring endorsement for TCFD recommendations
Juroku FG declared its endorsement for TCFD recommendations with the aim ofreinforcing its response to climate change and providing useful information to
stakeholders.

Governance

Strategy

Riskmanagement

Indicatorsand target

Juroku FG discusses its policy and key actions concerning
climate change at the Management Council, etc. and reflects
outcome to management strategy and risk management.
The Management Council periodically checks progress.

Juroku FG positions climate change response as an importantmanagement task, and addresses it from the perspectives ofboth risk and opportunity.
◆Risk
Physical and transitional risks are recognized as climaterelated risks in exploring ways of identifying and analyzing
the impact of the risks in the future.
◆Opportunity
Business opportunities are expected to increase due to the
expansion of market scale due to climate-related financesand solutions.
Juroku FG has adopted the “investment and loan policy toward
establishing a sustainable society.”
Recognizing climate-related issues as important risks, Juroku
FG strives to form a stance of managing such risks within theframework of integrated risk management.
Juroku FG aims to halve CO2 emissions in FY2030 from the FY2013
level and strives to achieve carbon neutrality by FY2050.

Investment in ESG bonds
Investment

31 cases worth 30.6 billion yen (April 2018 – September 2021)“Investment and loan policy
toward establishing a sustainable society”
Juroku FG has adopted an “investment and loan policy toward
establishing a sustainable society” to clearly set forth its stance forsolving environmental and social issues. Policies for specific sectors
are as follows:

Description

Target sector

Coal-fired
thermal power
generation

Weapons

Deforestation

Juroku FG will not invest in or extend loans to projects thatinvolve building new coal-fired thermal power stations or
expanding existing power generation facilities, while taking a
prudent approach in considering exceptional cases in responseto emergencies or in projects in line with the Japanese
government’s energy policy.
Juroku FG will not invest in or extend loans to companies that
manufacture weapons, regardless of fund usage, in view of theinhumane nature of cluster bombs, anti-personnel landminesand biological / chemical weapons.
Juroku FG will not invest in or extend loans to projects thatinvolve illegal logging or forest incineration. Investment in /loan to projects whereby the fund is used for operations thatinvolve deforestation will be considered carefully in view of
their impact on the local economy and the environment.

Commencing the use of CO2-free electricity generated in Gifu
Since November 1, 2021, Juroku FG
has started using “Gifu Seiryu Green
Electricity,” i.e. CO2-free electricity
generated in Gifu by Chubu ElectricPower Miraiz Co., Inc., at the head
office building.
As the first company to introduce Gifu
Seiryu Green Electricity, Juroku Bankis expected to mitigate CO2
emissions equivalent to 754 tons
per annum.

19Addressing climate change and environmental issues ②
 Actively collaborating with external parties to deploy solutions as a way of helping local customers shift toward
decarbonization
Building a platform for promoting
and spreading the J-VER scheme
Building a platform for spreading and promoting “carbon offset”
using the J-VER offset credit held by Gifu Prefecture’s Forestry
Corporation and the Kiso Sansen Water Resource Development
Corporation, in order to help customers adopt decarbonizationoriented business management

Platform overview

Offering consultation to customers about visualizing greenhouse gas
emissions and setting their mitigation targets to assist their carbon
management
Partnering with WasteBox, a professional with decade-long track records
in identifying environmental impact and greenhouse gas emissions, forco-creating business

Offset credit seller(J-VER)

Offset credit buyer(J-VER)

CO2
carbonoffsetCO2 emissions
that could not be
mitigated despite
corporate efforts

Consultation for supporting
decarbonization-oriented business management

Identifying
current
statusIdentifying
emissions in
Scopes 1 and 2

CO2 absorption
promoted throughappropriate forestry
development, etc.

Using the international standard called
GHG Protocol to identify damage thatbusiness activities cause to the global
environment

Purchase fund
Offset credit (J-VER) transaction agreement<Purchase benefits> Off-setting CO2 emissions
through corporate activities Differentiating products andservices from competitors’ Improving corporate image as acompany that actively takes onenvironmental and social
issues (CSR)

Juroku Bank

Referral cases(as of November 15)
13 cases

Offset credit (J-VER)
corporate buyer referral<Selling benefits> Using revenues from selling credit
for forestry development
 Building a network withenvironmentally-conscious
companies Publicizing and spreading
corporate image on building
sustainable and healthy forests

Disclosing
information aboutprogress each year

Reducing emissions
and disclosing
information in a way
integrated intobusiness management

SettingtargetSetting SBTlevel reduction
targets

Introducing targets that areon par with SBTs

Number of cases(as of November 15)• An environmental solution provider who
specializes in visualizing CO2
emissions, with clients including
ENEOS and other large corporations
and government offices• The only climate change consulting
partner for the international NGO,
“CDP,” in Japan14

GHG emissions

Intermediary

Customers
Offset credit usage
proposal

Reduction anddisclosure
Offset credit (J-VER) corporate buyer referral
Gifu Prefecture Forestry Corporation
Kiso Sansui Water Resource Development Corporation

Reduce 2.5% annually(required)
Reduce 4.2% annually(recommended)

Reduce30-50%

Base year(e.g., 2018)

TargetTarget year
(e.g., 2030)

Reduce80-100%year(2042)

20

Promoting DX
 Offering “convenience” to customers by delivering information in a timely fashion and eliminating hardcopy
forms and the use of seals
 Shortening office hours to improve “productivity”

Introducing digital signage to all branches
On October 1, 2021, Juroku
Bank introduced cloud-based
digital signage to all branches
via Google Cloud’s premium
partner, Densan System. The
advantage of cloud-based
service is utilized to offer
timely information and localonly information efficiently.
The digitization and central
management of posters at
branches also helps reduce
hardcopy media.

Electronic home loan service
This service allows customers to apply for preliminary andformal screening for a home loan online from theirsmartphone or home computer and complete acontractual procedure, making it more convenient thanever before to access a home loan anytime and anywhere.

In-store tablet device, “Juroku Quick Navi”
Introducing in-store tablet device “Juroku Quick Navi”
on November 29, 2021
The tablet device is used bycustomers to open a new
account, change customer details(address, account name), etc. toprovide “convenience” byeliminating the need to fill out ahardcopy form and improve“productivity” by reducing timerequired for administration.

Services that can be handled with the device
 Opening an ordinary bank account for individual customers
 Applying for J-Direct (personal online banking) Applying for a cash card
 Applying for a JCB debit card
 Applying for J-Point Style (point-system service)

Services that are due to be added by the end of FY2021
 Updating customer information (name, address, seal) Depositing money to / withdrawing money from an ordinaryaccount Handling fund remittance Paying taxes and utility bills
 Reporting lost / stolen cards

21Section III: First Management Plan

Overview of the management plan
First Management Plan
Period: October 2021 – March 2023

Our aim
To become a comprehensive financial group that builds a future with local communities andachieves sustainable growth with local economies

Maximizing
groupsynergy

Numerical targets for FY2022
Consolidated net income: 16 billion yen and above
Consolidated capital
adequacy ratio:

10% and above

Consolidated adjusted OHR:

65% and below

Reformingthe mentality
andbehaviors of
employees
and directors

Connecting people,
local communities and future

Consolidated non-interest
30% and above
income ratio:Long-term indicator
Consolidated ROE:

5% and above

Utilizingcustomerbase,
informationand network

DX strategy

Local commitment
strategy
Handling
comprehensive
local design

Improving
convenienceandproductivity
Market-in approach
strategy
Further exerting
problem-solving
capacity

23

Group management philosophy■Group management philosophy

Code ofconduct

Group management philosophy

Group management philosophy
Achieving growth andprosperity for ourcustomers and the local
community

Our mission

Our vision

Our
valuesOur mission

A comprehensive financialgroup that builds a futurewith local communities andachieves sustainablegrowth with local
economies

Trust&
integrity

Creation&
innovation

Diversity&
inclusion

A set of conducts aimed at facing the issues ofour customers and local communities andworking with them to bring solutions

Connecting people, local communities and future Juroku Financial GroupOur mission
Achieving growth and prosperity for our customers andthe local community

Our vision
A comprehensive financial group that builds a future withlocal communities and achieves sustainable growth withlocal economies

Our values
Trust & integrity
Creation & innovation
Diversity & inclusion

Our vision

Achieving growth and prosperity forour customers and the local
community

We have faced and walked with ourcustomers
throughfinancialservices built on tradition and trust.
We will continue to work with ourcustomers and local communities as
an irreplaceable partner in achieving
sustainable growth and building anenriched future.
That is the mission
Financial Group.
Connecting
people,communities and futureofJurokuA comprehensive financial group thatbuilds a future with local communities
and achieves sustainable growth withlocal economies

We strive to be a “comprehensive
financial group that builds a future
with
local
communities
andachieves sustainable growth withlocal economies” in order tocontribute to building a sustainable
society.

Our values

Trust & integrity
We act with a high level of ethics to gain
trust from our customers and people in local
communities so that they will continue tochoose us.

Creation & innovation
We adapt to any changes with continuous
creation and innovation, creating new values
that take us to the next era.

Diversity & inclusion
We recognize and respect one another’s
individuality and tap into diverse abilities tomaximize the Group’s capability.

local

Juroku Financial Group

Connecting people, local communities and future

Connecting people, local communities and future

Juroku Financial Group

Juroku Financial Group

Connecting people, local communities and future

Connecting people, local communities and future

Juroku Financial GroupThe Group Management Philosophy represents the fundamental spirit of the Juroku Financial Group, andthe foundation for all of our officers’ and employees’ activities.
This information is displayed on the screen of business smartphones (approx. 3,500 units) handed to officers and employees(including part-time workers) to remind them and establish the knowledge in them.

24Exerting the Group’s comprehensive capability
The Juroku Financial Group exerts its comprehensive capability in solving the issues of customers and local
communities to improve its corporate value and contribute to the sustainable growth of local communities.
Enhancing the financial intermediary function
Referring human resources
and assisting management

Changes inbusiness environment

JurokuResearch
Institute

Reduced market scalePopulation decline and aging
population
Reduced number of companies

JurokuBank

Improving theGroup’s productivity

JurokuBusiness
Service

Catering tocashless society

Fund management

Change in industrial structures

Juroku TT
Securities

JurokuCard

Transformation ofbusiness model Protracted negative interest rate Spread of cashless economy

Solving theissues ofcustomers andlocal
communities

Creating common
values Cross-industry business entries

Social changes
Response to climatechangeLiving with COVID-19
Banking industry
deregulation

Sustainable growth of local
communities

JurokuComputerService
Supporting digitaltransformation

Purposes of transition
Expanding business categories
Optimizing the distribution of the Group’s
management resources
Reinforcing the audit / supervisory function
and improving the pace of work execution

Juroku
Lease

Nobunaga
CapitalVillage
Supporting capital

JurokuCreditGuarantee

Forming assets

Improving corporate
value

Supporting
capitalinvestments

Contributing to establishing asustainable society

25

Management strategy
・Adopt three strategies, aimed at “expanding business categories” and “addressing diversifying needs”
as growth drivers, to maximize group synergy.
・Strive to transform the mentality and behaviours of directors and employees while maximizing theGroup’s customer base, information and network.
Management strategy

Market-in (market-oriented)
approach strategy
Further exerting problem-solving
capacity

Amassing the Group’s
management resources to fulfill
the consulting function

Corporate

Offering diverse solutions forvarious issues

Personal

Utilizing digital technology anddata to approach customers

DX strategy
Improving convenience andproductivity

Priority measures

Accelerating the digital transformationof work processes to create time forbusiness activities and increasebusiness value

Playing a central role in revitalizing
local communities throughexpansion of business categories
Deepening initiatives for SDGs
Local commitment strategy and local revitalization by Group
Handling comprehensive local design directors and employees

Main KPI:

Main KPI:

Offering diverse solutions to issues at each of corporate clients’ life stages
Number of consultation cases for corporate solutions (including cases basedon Group collaboration)
Building a consultation system toward establishing lifelong trading relations
Net increase of deposit assets (consolidated)
Net increase of deposit assets held by the bank and the securities company(compared to the level as at the end of September 2021)

Enhancing non-face-to-face
Data use and mass marketing
channels
Number of clients on non-face-to-face basis
Main KPI:••

Active individual and corporate clients on EB/IB contracts (at least one deposit per month)
Number of online loan agreements (ATM card loan, online-application personal loan, onlineapplication home loan)

Creating human resources in high-growth areas
through work streamlining
Main KPI:

Supporting work-style reform anddigital transformation reform

Number of workers assigned to high-growth areas
Rate of increase in core net operating profit per employee(compared to the FY2020 level)

Boosting the appealof local communities
Main KPI:

Providing assistance in solving local issues

Number of business creation supports
Among loans for recipients within five years of establishment: (1) Number of loans extended to clients for which
Juroku FG has provided assistance in formulating a business creation plan, (2) number of loans extended underschemes related to business creation (3) number of CVC investments made through Capital Village

Deepening Group’s initiatives for SDGs
and local revitalization
Main KPI:

Assisting SDGs initiatives by customers
and local communities

Number and value of ESG – SDGs investments and loans
Local ESG loans subject to subsidized interest payments, other applicable loan
products, private placement bonds and Green Bond

26

Management strategy ① Market-in approach strategy
Market-in approach strategy -- Further exerting problem-solving capacity –Main KPI

Amassing the Group’s management resources to fulfill the consulting function

Corporate• Number of consultation cases for corporate solutions(including cases based on Group collaboration)• Net increase of deposit assets (consolidated)(compared to the September 2021 level)

Offering diverse solutions for various issues• Develop human resources for boosting the Group’s solution-presenting capability for corporate clients, use the Ban’s customer
base, information and network, and collaborate with Group companies to offer diverse solutions to issues at each of corporateclients’ life stages.

Priority
measures

Offering diverse solutions to issues at each of the corporate clients’life stages

Solution-delivery system through collaboration withGroup companies
Foundation
stage

Reinforcing solution-presenting capability
Providingenhancedtraining

Developing humanresources capable ofbuilding strong ties
with customers

Offering
programs fordeveloping
specializedhuman
resources

Initiatives in the foundation and growth stages
Supporting fundraising through equity investment, and assisting the expansion ofsales channels through business matching, etc.
Initiatives in the stability stage
Facilitating leasing, diversification of the means of capital fund-raising, humanresource reference, cashless adaptation, digital transformation, etc.
Initiatives in the maturity / regeneration stages
Assisting project handling by bank branches / management succession support
office, collaboration with specialized consultants, and hands-on help
Strengthening
collaboration in highgrowth areas

Sales transition(Unit: 100 million yen)

Civil engineering andconstruction machinery

Juroku Lease
Addressing capital
investment needs in
Gifu and Aichi
Prefectures, whichhave a heavy
concentration ofdiverse industries
including automotiverelated industries

Contract breakdownby equipment type
Others3/2021

Industrial
machinetools

Commercial equipment
Transportationequipment
IT equipment
3/20183/20193/2020

Expanding sales
channels

Juroku Bank
Customer
base
Information
Network

Expanding into
overseas markets

Stability stage

Maturity /regeneration
stagesBusiness
succession

Diversifying
fundraising

Business
regeneration and
M&A

COVID-19-response, finances, DX, SDGs

JurokuResearch Institute

Human resource referral, management support

Juroku TT
Securities

Asset management

Juroku Card
Juroku Lease
Juroku Computer
ServiceNobunaga Capital
Village

Alliance

Collaboration

Boosting
communication
capability

Growth stage

Cashless adaptation, memberships
Capital investments
Digital transformation, receivable recovery
Equityinvestment

Business succession,business regeneration

Startups, Saas, Fintech, Funds, Consultation, M&A

3/202127

Management strategy ① Market-in approach strategy
Market-in approach strategy -- Further exerting problem-solving capacity –Amassing the Group’s management resources to fulfill the consulting function

Personal

Offering diverse solutions for various issues• Expand Group collaboration / alliance, and offer channels optimized to the needs of customers to build aconsultation system toward establishing lifelong trading relations

Priority
measures

Building a consultation system toward establishing
lifelong trading relations

Main KPI• Number of consultation cases for corporate solutions(including cases based on Group collaboration)• Net increase of deposit assets (consolidated)(compared to the September 2021 level)Group-based consultation system toward
establishing lifelong trading relations
Customer
base
Information
Network

Enhancing face-to-face channels
Offering value-added solutions through bank-securities partnership

YouthsParentinggroup

Asset-building
group

Retired group

Seniors

Addressing the needs for non-face-to-face transactions
Developing smartphone-based systems for building assets and raising loan needs

Adopting cashless transactions for improved convenience
Strengthening alliance
Expanding trust and insurance services to cater to customer needs

Strengthening
collaboration in highgrowth areas

Juroku TT
Securities

Offering nonbank solutions inthe securities
business toestablish lifelong
trading relations

Deposit assets (right axis,
Juroku TT Securities: Transition in
deposit assets and number of accounts 100 million yen)Reinforcing Group collaboration

Offering long-term perspectives in line with customers’ life plan

Cashless payment

Juroku Card

Juroku Credit Guarantee Consumption-type
loan

Juroku TT Securities

Home /
education fund

Alliance

Asset management

Asset building

Developing consultation
human resources
Improving expertise

JurokuBank

Property
management

Wealth Manager

Sales branches
Inheritance services /Estate settlement

App function

Number of accounts (leftaxis, accounts)

Channels optimized to customer needs
Non-face-toface channels

Enhancing non-face-toface channels toincrease customer
contacts
Boosting customer
needs to guide them toface-to-face channels

Face-to-facechannels
Bidirection(employees /branches)

Engaging customers in dialogs
to address their individual issues
and needs
Acting as a consultation base foroffering advanced andspecialized solutions that
correspond to the life stage ofeach customer

28

Management strategy ② DX strategy
DX strategy -- Improving convenience -Utilizing digital technology and data to approach customers• Enhancing non-face-to-face channels to improve product / service convenience and expand generaltransactions• Adopting advanced marketing based on data to address diversifying needs

Priority
measures

Enhancing non-face-to-face channels

Expanding transactions that are completed online
Expanding the functions of personal apps for improved
convenience
Building a platform as the gateway to corporate customers
Using a common platform for procedures to eliminate the useof seal and hardcopy forms in transactions

Offering friction-less functions and services
Using tablet devices and AI in-store
Enhancing online functions and contents to broaden the scope ofgeneral transactions

Priority
measuresMain KPIs• Number of clients on non-face-to-facebasis• Number of workers assigned to highgrowth areas

Expanding non-face-to-face channels to broaden the scope ofgeneral transactions
Expand non-face-to-face channels to provide convenient services that can integrate with face-to-facechannels in bi-directions

Deposits and exchange

Face-to-facechannels

JurokuCard

Deposits, foreignexchange, loans, etc.

Fund management and financePurpose-specificdeposit / THEO+
Life plan coaching
Card loan

Inheritance andvarious procedures
Fiscalinformation

Data use and mass marketing

Loans
AIBiz

Investment
trust
Insurance
Various loans

Onlineapplication forinvestment-type
products

Alliance

Juroku Cloud Factoring

Sharing and utilizing information internally and externally
Offering new financial services based on open API
Offering timely information services based on data analysis
Forming alliance to deliver IT consulting

Advanced marketing
Establishing theenvironment forgathering, accumulating
and utilizing data

High-quality
information(primary data)

Addressing
diversifying needs

29

Management strategy ② DX strategy
DX strategy – Improving productivity –Accelerating the digital transformation of work processes to createtime for business activities and increase business value

Main KPIs• Using digital technology to streamline work processes to optimize the distribution of management resources andredeploy personnel to strong-growth areas• Implementing work style reforms based on IT tools to make a Group-wide effort to develop human resourcesversed in digital technology
Priority
measures

Creating human resources in high-growth areas throughwork streamlining

Improving work processes and optimizing the distribution ofmanagement resources
Utilizing workflow systems, teleconferencing, digital forms, etc. to create extra
time for business activities
Using in-store tablet devices to shorten time for administration
Using digital technology to reduce back-office work and centralize it to thehead office
Deploying human resources strategically from administration to high-growthareas such as FA and Group companies
Priority
measures

Work-style reform and digital transformation support• Number of clients on non-face-to-facebasis• Number of workers assigned to highgrowth areas

Streamlining work processes to create human resources andoptimize their distribution

High-growth
areas
637

HR creation
Approx. 300•••

Streamlining branch
operations
Streamlining
administration
Streamlining head office
operations

HR planning (natural
decline): Approx. 160

High-growth areas:
Approx. 145

Redeploying HR to highgrowth areas• FA conversion ofadministrative HRs: Approx.
100• Group companies• New business categories• FG-dedicated personnel:
Approx. 45

Administrative
areas
493
Others1,740

High-growth
areas

Administrative
areas
Others21/4 (Bank non-consolidated)

23/3 (Bank non-consolidated + FG)

Work style reform and HR development

Expanding remote work to facilitate diverse work styles
Using IT tools to expand remote sales activities
Developing human resources in digital technology through alliance andStrategic personnel deployment
for
AIBiz cross-functional career paths

Digital transformation for greater work
streamlining and channel optimization

Work Facilitating digital transformation of customers and local communities

Using alliance to promote customers’ digital transformation
Utilizing Group companies’ functions to facilitate cashless transactions
by businesses and local communities
Building up digital transformation know-how such as teleworking,paperless transactions and table-based sales

Work-style reform and digitaltransformation support• Accumulating digital transformation
know-how• Reducing overtime work
• Helping employees gaining digitalrelated qualifications

Cross-functional career paths

ICT solutions
FA

Bank

Main business support

Loans

Local revitalization

Lease

Securities

Card

JCS

30

Management strategy③ Local commitment strategy

Local commitment strategy – Comprehensive local design –Playing a central role in revitalizing local communities
through expansion of business categories

Main KPIs• Establishing solid relations with local stakeholders and further expanding business categories as a general
financial group to deploy financial services that contribute to the development of the local economy, thereby
contributing to local revitalization

Priority
measures

Boosting the appeal of local communities

Creating local brands
Branding local delicacies and disseminating their information inlarge cities for PR

Utilizing local resources
Rediscovering local resources and implementing measures toboost local appeal to promote tourism
Coordinating industrial – bureaucratic – academic partnership toassist the development of new products

Creating new business
Assisting business creation and forming local communities
Expanding alliance and considering to establish communitydevelopment companies

Priority
measures• Number of business creation supports• Number and value of ESG – SDGs
investments and loans

Expanding business categories to implement in-depth initiatives
for local revitalization
Utilizing local resources

Creating local brands
Disseminating local
brandsSupporting
local industries

Collaborating with other banks and companies tosupport clients’ sales expansion

Revitalizing central business districts

Coordinating industrial –bureaucratic – academic partnership
Building a mechanism for promoting
tourismStrengthening ties withlocal government bodies

Redevelopment projects

PPP / PFI projects for privateand public-sector partnership

Digitization of deposit queries

Funds to revitalize
local cities

Relocation
promotion

Assisting local governments in
adopting cashless transactions

Revitalizing central business districts

Assisting local government bodies’ work streamlining
Facilitating cashless transaction response and contracting public
services (policy adviser), etc.

Public service
contracts

Expanding business that contributes tothe development of the local economy

Providing assistance in solving local issues

Facilitating urban redevelopment projects, PPP / PFI projects andfunds to revitalize local cities and encourage people to move inJuroku ResearchInstituteCommunity development

Nobunaga Capital Village

Expanding alliance

FinTechDeveloping leaders of local economy
Ventureinvestments,
support forbusiness creation

Forming local
communities

Business matching
Support for
expanding sales
channels

DX support

31

Management strategy ③ Local commitment strategy
Local commitment strategy – Comprehensive local design –Deepening initiatives for SDGs and local revitalization
by Group directors and employees

Main KPIs• Deploying suitable human resources to optimum positions and streamlining work processes tocreate extra time for business activities, while boosting awareness on SDGs and community
revitalization to deepen initiatives• Working with local businesses, business associates and local communities to take on local andenvironmental issues in order to establish a sustainable society

Priority
measures

Deepening Group’s initiatives for SDGs and local
revitalization• Number of business creation supports• Number and value of ESG – SDGs
investments and loans

The Group’s SDGs and community revitalization activities

Environment
Initiatives for decarbonization and CO2 reduction
Disclosure of climate change impact

Activities at Group sites for enhancing connection withcustomers and local communities

Society
Connection with customers and local communities at Group sites
Diversity promotion, women’s empowerment and HR development thattakes advantage of diverse capabilities

GovernanceBusiness management that makes use of external knowledge
and insight
Enhanced compliance system
Priority
measures

Sales support

Tourism promotion

Community PR

Financial literacy

Group governance

Emergency and crime
prevention

Infectious disease
prevention

Environmental
conservation

Assisting SDGs initiatives by customers and local
communities

Support for SDGs initiatives by corporate clients
Support for the introduction of SDGs-based management
Support for SDGs initiatives by local communities
Educational and cultural activities, emergency preparedness

Sharing cases within the Groupto further deepening
each of the activities
32

Main initiatives: Expanding business categories ①
 In a lead-up to the formation of the Juroku Financial Group, NOBUNAGA Capital Village was established with theaims of expanding business categories and developing new services through co-creation with investment
recipients.

Investments by NOBUNAGA Capital Village with a view to achieve co-creation and collaboration
Creating synergy with the Group’s own business through CVC (corporate venture capital) investments
Juroku FG

Benefits expected from co-creation
with venture businesses

Providing newvalue
Providing capital

Co-creation

Revitalizing local
communities

Investment

Investment
recipients

•
•
•
•

Exploring innovation
Inspiring corporate culture
Gaining insight into a new market
Finding the missing peace in solving issues“Creating new business”“Strengthening existing business”

Past investments (up to the end of October 2021)

Past investments
CVC

２

Community VC

１Business
succession

１

Recipient

Reasons for investment

OLTA

・Appeal of OLTA as a company
・Providing new value to local communities through cocreation
・Expectations for future outlook

Luup・Appeal of Luup as a company
・Appeal of the founder team・Expectations for electric kickboards (revitalizing local
communities)

33

Main initiatives: Expanding business categories ②
 Juroku Bank signed a basic agreement with Densan System Holdings Co., Ltd. On August 31, 2021 to start
exploring a joint venture business in the field of digital technology.
 The partnership is aimed at advancing the use of technology in the banking business and contributing to thepromotion of digital transformation at local companies and government bodies.

Signing a “basic agreement on considering a joint venture business” with Densan System Holdings

Solution fields to be targeted by the joint venture

Overview of Densan System Holdings
NameIdentifying customers’ issues throughconsultation and support in main
business fields
Offering DX-related support for solving
issuesDX
promotion
for solving
business
associates’
Offering Juroku
Spreading businessissues
FG’s DX know-how
from associates toto local business
entire local communities
associates
Juroku Financial Group

Location

Densan System Holdings Co., Ltd.
1-58 Hikie, Gifu-shi, Gifu

Establishment

July 1, 2021 (The original operating company wasestablished on March 14, 1967.)

Description

A holding company with a group of general information
service companies under its umbrella

Paid-in capital 2,469 million yen
Listed stock
markets

First Section, Tokyo Stock ExchangeFirst Section, Nagoya Stock Exchange

Consolidated
45,752 million yen (December 2020 term)
net sales

Densan System Holdings

DX-based support foraddressing population
decline and aging
population
DX-based support for
tourism and otherlocal industries

Local
revitalizat
ion withDX

Advancement ofJurokuFG’s DX
capability

Deploying Juroku
FG’s local
revitalization initiatives
in the DX approachImproving Juroku FG’s
IT insight and capability
Promoting own RPA tostreamline operations
Helping customers
improve UI / UX in a
speedy manner(UI/UX: User interface and user experience)

Launching a joint venture business on thepremise of obtaining required approvals, etc.
from relevant authorities by the spring of 2022
Juroku Computer Service Co., Ltd. is to beturned into a joint venture for joint management
as a company for advancing digital technology inthe banking industry.

34

Main initiatives: Response to COVID-19
 Focusing on cashflow support, management improvement support and business rebuilding support in FY2021
 Early vaccination among workforce has enabled face-to-face sales activities, bringing the sales operation backto the pre-COVID level.

Status of COVID-19-related loans

Workforce vaccination

With the end of the zero-interest unsecured loan program, thenumber of COVID-19-related loans has settled, with a focus
shifted toward support for efforts to rebuild business.

Juroku FG was one of the first to take on organized workforce
vaccination, vaccinating 82.6% of its workforce against COVID-19
as of September 2021. The percentage increases to 87.6% if
those who have booked to receive vaccination are included.

End of 3/21

End of 6/21

End of 9/21

Number of COVID-19related loans extended(cumulative total)

11,578

12,57912,782

Amount of COVID-19related loans extended(cumulative total)

302.7
billion yen

329.1
billion yen

337.5
billion yen(including the amount ofinterest-free loans backed
by loan-guarantee
corporations)(cumulative total)

181.7
billion yen

203.6
billion yen

203.6
billion yen

Number of home loans
whose terms have beenrequested to change due to
COVID-19

316

Amount of home loans
subject to the said changeof terms

4.4 billion
yen

369

5.9 billion
yen

COVID-19 forced non-face-to-face
operations, but workforce vaccination
has brought back face-to-face sales.

(Reference)

Vaccination rate asof 9/1

Vaccination rate asof 9/30

Gifu

44.93％

57.48％

Aichi

40.81％

54.26％

Nationwide

43.36％

56.16％

402

7.1 billion
yen

Government’s CIO portal “Status of COVID-19 vaccination”

35