May 30, 2006
Sony Financial Holdings Inc.

Consolidated Financial Results for the Fiscal Year ended March 31, 2006
(Prepared in Accordance with Japanese GAAP)Tokyo, May 30, 2006 -- Sony Financial Holdings Inc. (“SFH”) today announced its consolidated financial results
for the fiscal year ended March 31, 2006 (from April 1, 2005 to March 31, 2006). SFH maintains its accounting
records and prepares its financial statements in Japanese yen in accordance with the former Commercial Code ofJapan, the Insurance Business Law of Japan and the Banking Law of Japan and in conformity with generally
accepted accounting principles and practices in Japan (“Japanese GAAP”). Despite the information set forth
herein, SFH’s parent company, Sony Corporation, otherwise reports its financial statements in accordance withgenerally accepted accounting principles and practices in the United States (“U.S. GAAP”), which differ in somerespects from Japanese GAAP. Those differences include derivative treatments for convertible bonds andinsurance-related accounts such as insurance acquisition costs and policy reserve as described in Note on Page 2.

Highlights
Ordinary revenues increased 16.1% from the previous fiscal year to ¥758.7 billion.
Ordinary revenues from the life insurance business increased 15.3% year on year to ¥696.6 billion, mainly as aresult of an improvement in gains and losses from investments and an increase in income from insurance premiums
reflecting a stable increase of insurance-in-force in particular from individual life insurance policies. Ordinary
revenues from the non-life insurance business increased 19.8% year on year to ¥45.7 billion as a result of acontinued increase in net premiums written mainly from automobile insurance. Ordinary revenues from thebanking business increased 51.7% year on year to ¥17.2 billion associated with steady business growth resulting
mainly from a stable increase in deposited assets (deposits and investment trusts) and mortgage loans.
Ordinary profit increased 106.8% from the previous fiscal year to ¥25.3 billion.
Ordinary profit from the life insurance business increased 42.2% year on year to ¥24.3 billion, primarily as a resultof an improvement in gains and losses on investments in the general account. In the non-life insurance business,ordinary loss improved ¥2.0 billion year on year to ¥0.7 billion, backed by an increase in net premiums written and
an improvement in the expense ratio. The banking business recorded ordinary profit of ¥1.7 billion, a ¥3.8 billion
improvement from the previous fiscal year. This was achieved as a result of an increase in gross operating profit
associated with business expansion.
Net income increased 81.0% from the previous fiscal year to ¥11.5 billion.
Total assets as of March 31, 2006 increased 19.3% from March 31, 2005 to ¥3,917.0 billion.
In September 2005, SFH purchased 15,000 shares of common stock of Sony Bank Inc. (“Sony Bank”) fromLabMorgan Investment Corporation, a unit of JPMorgan. And in February 2006, SFH implemented a ¥2.5 billion
capital increase of Sony Bank, for the purpose of further strengthening Sony Bank’s financial position. As aresult, SFH’s ownership in Sony Bank has increased from 84.2% as of March 31, 2005 to 88.0% as of March 31,
2006.

1

【Segment Information】
Ordinary revenues(Millions of Yen)
For the year ended
March 31, 2005

For the year ended
March 31, 2006

Change (%)

Life insurance business

604,288696,685+15.3

Non-life insurance business38,159

45,703+19.8

Banking business

11,353

17,225+51.7

Subtotal

653,802759,614

+16.2

(542)

(903)

653,259

758,711

Corporate and elimination
Consolidated+16.1

Ordinary profit (loss)(Millions of Yen)
For the year ended
March 31, 2005

For the year ended
March 31, 2006

Change (%)

Life insurance business

17,14824,379+42.2

Non-life insurance business(2,806)(764)-

Banking business(2,118)

1,705-

Subtotal

12,222

25,320+107.2

4657

12,26925,377

Corporate and elimination
Consolidated+106.8

Banking business segment includes a one-time amortization of goodwill associated with purchase of Sony Bank’s shares andacceptance of its capital increase in the fiscal year ended March 31, 2006 and acceptance of an increase in capital of Sony Bank in
the previous fiscal year.

NoteAs mentioned above, SFH prepares its financial statements in accordance with Japanese GAAP, which differs on some respects from U.S. GAAP.
These differences between Japanese GAAP and U.S. GAAP include the following:1) derivative treatments for changes in the fair value of convertible bonds, classified as available-for-sale debt securities, are recorded instockholders’ equity (as a component of accumulated other comprehensive income) under Japanese GAAP, whereas under U.S. GAAP the stock
conversion rights embedded in convertible bonds are separately considered as derivative instruments and changes in their mark-to-market values arerecognized in income;2) insurance-related accounts, including (i) insurance acquisition costs, whereby acquisition costs for both life and non-life insurance policies arecharged to income when incurred under Japanese GAAP, whereas under U.S. GAAP those costs are deferred and amortized generally over thepremium-paying period of the related insurance policies, and (ii) the policy reserve, which under Japanese GAAP is caluculated under the authorizationof the supervisory administrative agencies, whereas under U.S. GAAP future insurance policy benefits are comprehensively adjusted to a net level
premium method with certain adjustments for actuarial assumptions for U.S. GAAP purposes.

For inquiries: Sony Financial Holdings Inc. Corporate Communications
Tel: 81-(0)3-5785-1074
Website of Sony Financial Holdings Inc.: http://www.sonyfh.co.jp/english/2Consolidated Financial Summary
for the Fiscal Year ended March 31, 2006
May 30, 2006
Company name:
Representative:
For inquiry:

Sony Financial Holdings Inc.
(URL: http://www.sonyfh.co.jp/english/)
Teruhisa Tokunaka, President, Representative Director
Hiroaki Kiyomiya, Chief Manager – Corporate Control Dept.

Consolidated financial results for the year ended March 31, 2006
Note: Since the company was established on April 1, 2004, there are no comparative data from the previous fiscal year for the year ended
March 31, 2005.

(1) Operating results

For the year ended
March 31, 2006
For the year endedMarch 31, 2005

For the year ended
March 31, 2006
For the year ended
March 31, 2005

(in millions of yen by discarding fractional amounts of less than 1 million yen)

Ordinary Revenues

Ordinary Profit

million yen%change

million yen

Net Income%change

million yen%change

758,711(+16.1 )25,377( +106.8 )

11,537(+81.0 )653,259(-12,269(6,375(-)-

Net Income per ShareNet Income per Share(Fully Diluted)

Yen

Yen

5,494.28-3,069.93-)

Notes: 1. Average number of shares outstanding (Consolidated): For the year ended March 31, 2006:
For the year ended March 31, 2005:
2. Changes in accounting policy: None)

2,100,000 shares
2,076,712 shares(2) Financial conditions
Total Assets

Total Stockholders’EquityStockholders’Equity Ratio

Stockholders’ Capital Adequacy Ratio(domestic criteria)
Equity per ShareYen (Preliminary basis) %million yen

million yen%

As of March 31, 2006

3,917,048

263,040

6.7

125,257.54

9.99

As of March 31, 2005

3,282,269

182,817

5.6

87,056.14

12.17

Notes: 1. Number of shares outstanding (Consolidated): As of March 31, 2006:
2,100,000 shares
As of March 31, 2005:
2,100,000 shares
2. Pursuant to “Defining the Standards on the Consolidated Capital Adequacy Ratio under the Provision of Article 52-25 of theBanking Law (Ministry of Finance Directive 62, 1998)”, insurance subsidiaries are excluded from calculation of theconsolidated capital adequacy ratio.

(3)

Cash Flows

For the year ended
March 31, 2006
For the year ended
March 31, 2005

Cash and Cash
Equivalents at end offiscal year
million yen
million yen

Cash Flows fromOperating Activities

Cash Flows from
Investing Activities

million yen

million yen

425,411(570,196)-

109,263

274,150(286,192)

3,500

253,969

3

Cash Flows from
Financing Activities

Consolidated Balance Sheets [Unaudited](in millions of yen)
As of March 31, 2005

As of March 31, 2006

Assets:Cash and due from banks
Call loans and bills bought
Commercial paper and other debt purchased
Monetary trusts
Securities
Loans
Property and equipment
Due from agencies
Due from reinsurers
Foreign exchanges
Other assets
Deferred tax assets
Reserve for possible loan losses

75,811
303,796
1,998
515,229
2,058,456
206,305
51,6685252
4,659
62,562
1,710(187)

61,30476,0742,000
658,351
2,625,081
326,392
76,5880419
5,748
82,046
3,247(205)

Total Assets

3,282,269

3,917,048

Deferred tax liabilities on land revaluation

25,363
2,418,194
735
1,155
781
546,717
24,60013
45,543
1,495
10,492
77
12,672
6,029-

28,4182,769,126
1,584
1,415
990
599,952
110,700
5
67,190
1,735
11,003202
20,12436,685706

Total Liabilities

3,093,875

3,649,842

5,576

4,165

Stockholders’ Equity:
Common stock
Capital surplus
Retained earnings
Land revaluation
Net unrealized gains on other securities, net of taxes
Foreign currency translation adjustments

5,500
180,877(59,232)(768)
56,817(374)

5,500
180,877(47,694)(1,475)
125,720
113

Total Stockholders’ Equity

182,817

263,040

3,282,269

3,917,048

Liabilities:
Policy reserve and others:
Reserve for outstanding claims
Policy reserve
Reserve for policyholders’ dividends
Due to agencies
Due to reinsurers
Deposits
Call money and bills sold
Foreign exchanges
Other liabilities
Reserve for employees’ bonuses
Reserve for employees’ retirement benefits
Reserve for directors’ retirement benefits
Reserve for price fluctuations
Deferred tax liabilities

Minority Interests

Total Liabilities, Minority Interests and Stockholders’ Equity

4

Consolidated Statements of Income [Unaudited](in millions of yen)

For the year ended
March 31, 2005

For the year ended
March 31, 2006

Ordinary Revenues

653,259

758,711

Ordinary Revenues from the Life Insurance Business:
Income from insurance premiums
Investment income
Other ordinary income

551,447
50,254
2,072580,171
108,613
7,091

Ordinary Revenues from the Non-life Insurance Business:
Underwriting income
Investment income
Other ordinary income

37,862
275
1045,298
349
32

Ordinary Revenues from the Banking Business:
Interest income
Fees and commissions
Other operating income
Other ordinary income

6,563
799
3,946
25

9,472
1,635
6,039
7

Ordinary Expenses

640,990733,333

Ordinary Expenses from the Life Insurance Business:
Insurance claims and other payments
Provision for policy reserve and others
Investment expenses
Operating expenses
Other ordinary expenses

194,141
299,508
5,115
79,682
8,603

231,885
344,939
4,610
81,982
8,744

Ordinary Expenses from the Non-life Insurance Business:
Underwriting expenses
Investment expenses
Operating, general and administrative expenses
Other ordinary expenses

28,54621
12,097
033,170812,903
15

Ordinary Expenses from the Banking Business:
Interest expenses
Fees and commissions
Other operating expenses
General and administrative expenses
Other ordinary expenses

2,855
479
2,452
6,902
582

4,672
771
1,890
7,088
650

Ordinary Profit
Extraordinary Gains
Extraordinary Losses
Provision for Reserve for Policyholders’ Dividends

12,2690516
519

25,377
7,555
1,491

Income Before Income Taxes
Income Taxes - Current- Deferred
Minority Interests

11,233
13,570(8,428)284

16,33017,236(12,871)(427)

Net Income

6,375

11,537

5

Consolidated Statements of Cash Flows [Unaudited](in millions of yen)
For the year ended
March 31, 2005

Cash flows from operating activities:
Income before income taxes
Depreciation and amortization
Impairment losses
Increase in policy reserve and others
Interest and dividends
Interest expenses
Net (increase) decrease in loans
Net increase (decrease) in deposits
Net (increase) decrease in call loans and bills bought
Net increase (decrease) in call money and bills sold
Others, net

For the year ended
March 31, 2006

11,233
3,339
307,989(32,593)
2,988(63,361)
168,060(86,729)(40,400)(20,051)

16,3303,524
5355,467(36,549)
4,681(113,082)
53,417
107,522
86,100(72,511)

Subtotal

250,474

404,905

Interest and dividends received
Interest paid
Policyholders’ dividends
Income taxes paid

41,612(2,413)(568)(14,954)

41,374(4,535)(644)(15,688)

Net cash provided by operating activities

274,150

425,411(94,487)(1,083,349)
906,646(37,146)
28,653(116,304)(1,184,665)
767,116(39,996)
32,723(279,683)(541,127)(5,358)1(1,151)(25,845)(1,571)(1,652)

Net cash used in investing activities(286,192)(570,196)

Cash flows from financing activities:
Proceeds from borrowings
Repayments of borrowings
Proceeds from issuance of stocks
Cash dividends paid

15(15)
10,000(6,500)-

Net cash provided by financing activities

3,500-(2)79Net decrease in cash and cash equivalents(8,544)(144,706)

Cash and cash equivalents at beginning of year

262,513

253,969

Cash and cash equivalents at end of year

253,969

109,263

Cash flows from investing activities:
Investments in monetary trusts, net
Purchases of securities
Proceeds from sale and redemption of securities
Investments in loans
Collections of loans
Subtotal
Purchases of property and equipment
Proceeds from sale of property and equipment
Purchase of securities of a consolidated subsidiary
Others, net

Effect of exchange rate changes on cash and cash equivalents

Notes:
1. The reconciliation of “Cash and cash equivalents” in the consolidated statements of cash flows to “Cash and due from banks” in theconsolidated balance sheets is as follows:(in millions of yen)
Cash and due from banks:
75,811
61,304
Call loans of domestic life insurance subsidiary:
176,100
55,900
Securities of non-life insurance subsidiary:
32,93244,067
Securities other than cash equivalents of non-life insurance subsidiary:(30,874)(42,009)
Negotiable certified deposits of banking subsidiary:(10,000)
Cash and cash equivalents:
253,969
109,263
2. Cash flows from investing activities include cash flows from lending operations of the insurance business.

6Notes to the Consolidated Financial Statements
1. Basis of Presenting Consolidated Financial Statements
Sony Financial Holdings Inc. (the “Company”) and its domestic subsidiaries maintain their accounting records
and prepare their financial statements in Japanese yen in accordance with the provisions set forth in the former
Commercial Code of Japan, the Insurance Business Law of Japan and the Banking Law of Japan and inconformity with generally accepted accounting principles and practices in Japan, which are different in certain
respects as compared to the application and disclosure requirements of generally accepted accounting principles
and practices in the United States of America. The Company’s overseas subsidiary maintains its accounting
records and prepares its financial statements in conformity with generally accepted accounting principles andpractices prevailing in its country of domicile.
The accompanying consolidated financial statements are prepared based on the consolidated financial
statements of the Company and its subsidiaries (the “Companies”) which are to be filed with the Financial
Services Agency as required by the Insurance Business Law and the Banking Law. For the convenience ofreaders, the preparation is modified in certain respects from the original Japanese disclosed financial information.
2. Principles of Consolidation(1) Scope of consolidation
The number of consolidated subsidiaries: 4
Consolidated subsidiaries: Sony Life Insurance Co., Ltd.
Sony Life Insurance (Philippines) Corporation
Sony Assurance Inc.
Sony Bank Inc.
(2) Application of the equity method
Not applicable(3) Fiscal year of consolidated subsidiaries
The financial statements of Sony Life Insurance (Philippines) Corporation are prepared with a fiscal year endof December 31. Appropriate adjustments are made for material transactions between December 31 andMarch 31, the date of the consolidated financial statements. All the other subsidiaries prepare their respective
financial statements with a fiscal year end of March 31, the same as the date of the consolidated financialstatements.
(4) Valuation of assets and liabilities of consolidated subsidiaries
A portion of the assets and liabilities of consolidated subsidiaries are computed at fair value as of therespective dates when the subsidiaries were initially consolidated.
(5) Amortization of goodwill
Goodwill is charged to income directly when incurred.

3. Summary of Significant Accounting Policies(1) Securities
Securities (including commercial paper and other debt purchased and monetary trusts) are stated in thefollowing manner:
Securities held for trading purposes (“trading securities”) are stated at fair value. The cost of securities sold isdetermined by the moving-average method. Held-to-maturity securities are stated at amortized cost(straight-line method) using the moving-average method. Other securities designated as available-for-salesecurities with fair value are stated at fair value at fiscal year end, and its cost of securities sold is determinedby the moving-average method. Other securities designated as available-for-sale securities with no available

7

fair value are stated at amortized cost (straight-line method) or at acquisition cost using the moving-averagemethod. Net unrealized gains and losses on other securities above are reported, net of applicable income
taxes, as a separate component of stockholders’ equity.
(2) Derivative financial instruments
Derivative financial instruments are stated at fair value.
(3) Property and equipment
Primarily, depreciation is computed by the straight-line method for buildings and by the declining-balancemethod for other property and equipment.
(4) Software for internal use
Capitalized software for internal use is amortized using the straight-line method over its estimated useful lifeof five years.
(5) Deferred charges
Stock issuance costs are fully charged to income when incurred.
(6) Reserve for possible loan losses
The reserve for possible loan losses is established in accordance with each company’s Self-Assessment
Guidelines and Write-offs and Reserve Guidelines. With respect to loans to borrowers subject to bankruptcy,
court-guided rehabilitation or similar legal or formal proceedings, the Companies provide a specific reservein the amount of the loan balance less amounts collectable from collateral, guarantees and by other means.
For other loans, the Companies provide a general reserve by applying the historical loan loss ratio determinedover a certain period. Each loan is subject to asset assessment by the operational departments in accordancewith each company’s Self-Assessment Guidelines, and the results of the assessment are reviewed by theinternal audit departments, which are independent from the operational departments, before the reserveamount is finally determined.
(7) Reserve for employees’ bonuses
The reserve for employees’ bonus is provided for the payment of bonuses to employees, in the amount ofestimated bonuses, which are attributable to the current fiscal year.
(8) Reserve for employees’ retirement benefits
The reserve for employees’ retirement benefits is provided for the payment of retirement benefits toemployees, in the amount deemed accrued at the fiscal year end, based on the projected retirement benefit
obligation at the fiscal year end.
(9) Reserve for directors’ retirement benefits
The reserve for directors’ and statutory auditors’ retirement benefits is provided based on its internal
regulations and calculated as the amount that would be payable if all eligible directors and statutory auditors
were to resign at the fiscal year end.
(10) Reserve for price fluctuations
Pursuant to requirements under the Insurance Business Law, the reserve for price fluctuations is provided forprice fluctuations primarily related to stocks, bonds and foreign currency denominated assets which areexposed to losses due to market price fluctuations. This reserve may only be used to reduce deficits arisingfrom price fluctuations on those assets.
(11) Translation of foreign currencies
Assets and liabilities denominated in foreign currencies are translated into Japanese yen at the foreignexchange rates in effect at the fiscal year end.

8(12) Leases transactions
Finance leases that have not been deemed to transfer ownership of the leased property to the lessees areaccounted for as operating lease transactions.
(13) Hedge accounting
As for the hedge accounting method applied to hedging transactions for interest rate risk generated byfinancial assets and liabilities, the banking subsidiary applies deferred hedge accounting or fair value hedge
accounting. Interest rate swaps are used as hedging instruments to offset fluctuations in interest rates on
fixed-rate loans by identifying the hedged items via their grouping according to their maturity, in accordancewith the “Treatment for Accounting and Auditing of Application of Accounting Standard for Financial
Instruments in the Banking Industry” (Industry Audit Committee of Japanese Institute of Certified Public
Accountants No. 24). Interest rate swaps and others are used as hedging instruments to offset fluctuations in
the fair value of fixed-rate bonds, which are classified as other securities. Both of the above-mentioned
hedging instruments are identified so that their significant terms are nearly identical to those of the hedged
items. Accordingly, such hedges are considered as highly effective, resulting in a substitution for evaluating
the effectiveness of the hedging transactions.
(14) Accounting for consumption taxes
The consumption taxes received or paid by the Company and its domestic subsidiaries, excluding loss
adjustment expenses and operating, general and administrative expenses of the non-life insurance subsidiary,
are not included in income and expenses. Under the Consumption Tax Law of Japan, the consumption taxes
paid on property and equipment, which is not deductible from the consumption taxes received, are deferredas “other assets” and amortized over a five-year period on a straight-line basis, while other non-deductible
consumption taxes are charged as expenses in the period in which the consumption taxes are paid.
(15) Policy reserve
Pursuant to Article 116 of the Insurance Business Law, the domestic life insurance subsidiary maintains a
policy reserve for the fulfillment of future obligations under life insurance contracts, and the policy reserve iscalculated in the following manner.
a. Policies subject to the standard policy reserve apply the method stipulated by the Financial Services
Agency (Ministry of Finance Directive 48, 1996).
b. Policies not subject to the standard policy reserve apply the net level premium method.
(16) Application of consolidated tax provision
The consolidated tax provision, under which Sony Corporation is the parent company, is applied to theCompany and its domestic subsidiaries wholly owned by Sony Corporation.

9