The Chiba Bank, Ltd.
IR DayApril 24, 2024

Event Summary[Company Name]

The Chiba Bank, Ltd.

[Event Name]

IR Day[Date]

April 24, 2024

[Time]

10:00 – 11:37(Total: 97 minutes, Presentation: 37 minutes, Q&A: 60 minutes)[Number of Speakers]

8
Tsutomu Yonemoto
Kiyomi Yamazaki

Mutsumi Awaji

Masayasu Ono

Yuko Tashima

Yasuko Takayama
Takahide Kiuchi
Akira Eshita

President, Group Chief Executive Officer
Director and Senior Executive Officer, Group
Chief Business Officer, Head of Business
Promotion Management Division
Director and Senior Executive Officer, Group
Chief Strategy Officer, Group Chief Digital
Transformation Officer
Director and Managing Executive Officer,
Group Chief Risk Officer, Head of Corporate
Management Division
Non-Standing Director (Outside Director andChairman of the Appointment,
Remuneration and Corporate Advisory
Committee)
Non-Standing Director (Outside Director andChairman of the Board of Directors)
Non-Standing Director (Outside Director)
Executive Officer, General Manager ofCorporate Planning Division

Yonemoto: Good morning, everyone. I am Yonemoto, President of the Bank.
Today we are holding our second IR Day this month as an opportunity to inform you of our efforts since thebusiness improvement order last June. Today’s theme is business improvement plan and governance.

Please see table of contents. First, as shown above left, following the business improvement order of June
2023, we have conducted a thorough fact-finding and true cause analysis and developed a business
improvement plan.
I will then present a general overview of our efforts and its details. As a result of numerous discussions during
the planning process, it was recognized that the most important initiative for improvement and prevention ofrecurrence is the penetration and thorough implementation of the purpose, vision, etc. On this basis, we arestrengthening our operational management, internal management, and business management systems. I will
present an overview of those.
With regard to the banking and securities strategic business model on the bottom right, we would like tosupport the establishment of a self-driven business model in which Chibagin Securities Co., Ltd. aims forsustainable growth without depending on the Bank, with the group as a whole.

1First, let me explain the timeline of facts. In formulating our medium-term management plan, which began in
April 2023, we have considered what our day-to-day activities produce and what we should be to those whointeract with the Chiba Bank Group and have established our Purpose and Vision for the Group.
Subsequently, in June 2023, the Bank was issued with the business improvement order as an administrative
action related for situations where a problem related to the investors’ protection was recognized inconnection with the Bank’s financial instruments intermediary business related to the solicitation and salesof structured bonds. In addition, Chibagin Securities was issued with the business improvement order as anadministrative action regarding business operations that violate the suitability principle for solicitation andsale of structured bonds.
In response to those administrative actions, we held numerous discussions over a period of approximately
two months and formulated the business improvement plan. This point will be explained on the next page.
After the business improvement plan is formulated, CxOs in charge of each improvement measure report on
the progress of the plan at the monthly management meeting. In addition, we report progress to the Kanto
Local Finance Bureau every three months based on the resolution by the Board of Directors, and the progressis also announced on our website.

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This section describes the formulation of the business improvement plan. Immediately after receiving therecommendation for administrative actions, we established an Investigation and Improvement Planning
Committee with outside attorneys as members, as described in the upper left-hand column, and began toascertain the facts.
Specifically, we have examined all relevant documents of past meetings of the Board, management meetings,
committee minutes, and other related meetings, conducted interviews with more than 35 persons involved,
analyzed the true causes, verified where responsibility lies, and examined improvement measures.
The committee meetings were held almost daily, more than 50 times in total, for thorough verification anddiscussion. As a result of such fact-finding process, it was found that the failure to take appropriate action
when feedback was received from the Japan Securities Dealers Association or JSDA was a major factor thatdelayed the response to the problem.
Dispositions are determined by an approach that focuses on the disposition of the parties involved with the
feedback. In deciding on the disposition, the Appointment, Remuneration and Corporate Advisory Committee,
chaired by an outside director and majority of which are outside directors, and the Board held discussions andmade a decision based on discussions at the Investigation and Improvement Planning Committee, which
resulted in the announcement of the disposition at the end of August 2023.
From the receipt of the recommendation for administrative actions to the end of August, when the disposition
was announced, the Board met five times and the Appointment, Remuneration and Corporate Advisory
Committee held two discussions, as well as individual meetings with outside directors, in order to decidedetails of the business improvement plan and the disposition.

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Once again, our raison d’etre, the purpose, is “to create a community better suited to bringing each person’s
hope to life.” In order to continue to demonstrate to society the significance of our existence, we haveestablished the vision “An Engagement Bank Group that works closely with the community,” which is theimage we aim to achieve.
To achieve the Purpose and Vision, we have established the Fiduciary Duty or FD Policy shown above right as
our policy for acting on behalf of our customers. In addition, we have a Human Resources Development Policy
to promote the growth and development of our staff in order to realize our purpose.
In addition, in order to ensure that the Purpose and Vision are firmly established and permeate theorganization, we have established the three pledges listed in the middle column as principles of conduct. The
three pledges are to always stop and think, whenever making a proposal to a customer or making a businessdecision, whether this proposal or decision will lead to the realization of the customer’s wish, whether this
proposal or decision will solve the customer’s problem, and whether this proposal or decision will lead to therealization of prosperous lifestyles for the customer.
We will strive to regain the trust of our customers and all other stakeholders by ensuring that this is thestandard of conduct for all executives and employees, and that they put this standard into practice in every
aspect of their work, thereby realizing the Purpose and Vision.

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We have analyzed the three major causes of problems.
The first is the issue of incentive mechanisms in the operational management system described in the upper
left-hand corner. The performance evaluation system adopted to strengthen cooperation between the Bankand the securities company resulted in a performance award system in which referral-based intermediaries
were evaluated higher relative to their business volume, with a lighter administrative burden compared tomutual funds and insurance.
At the same time, for sales representatives of Chibagin Securities, receiving referrals through referral-based
intermediaries was an effective means of acquiring new clients. As a result, sales representatives of both the
Bank and Chibagin Securities had an incentive to actively engage in referral-based intermediaries, and salesof structured bonds through referral-based intermediaries were easily favored.
The second is the issue of the internal management system described in the middle left-hand column. It is amatter of mechanism. In the sales branches and sales departments, known as the first line, the pressure tohave their earnings-related evaluations affect performance awards and personnel evaluations has motivatedthem to sell structured bonds. Pro forma checks by internal control managers and others also created
opportunities for problems to arise.
Furthermore, the fact that there was an atmosphere in the sales field in which employees were evaluated aslong as they achieved profitability, and the bad feeling of security that Chibagin Securities was ultimately
accountable for the sales, justified the structured bond inducement.
In the second line, the administrative section, the check-and-balance function was not fully exercised due toproblems with the organizational structure and other factors. The audit department, the third line, was also
dysfunctional due to insufficient risk detection capabilities and analytical insight into detected risks and was
unable to take appropriate action.
The third issue is in the business management system in the lower left-hand column. First, there were
problems with group governance, such as understanding the current status of group companies. Second,
management did not adequately address problems in operational management and internal management5systems. Third, we believe that there were also problems with the organizational culture within the Group,
such as prioritizing sales promotion over complaint handling.
To address these issues, we are first and foremost working to ensure that the Purpose and Vision are
thoroughly understood and implemented, and then we are strengthening our operational management,internal management, and business management systems.

6Here is a list of key measures. We are steadily advancing individual measures for the four initiatives I have
explained. There are a total of 57 measures broadly divided, and this list describes the major measures amongthem.
Of the measures listed, the three measures shaded in the table are those that have not yet been implemented
due to system development and other reasons.
The other items have already been implemented and will be brushed up as we continue to implement them.
To date, we have added nine measures to the originally submitted improvement plan based on the insights
gained in the course of implementing measures based on the improvement plan. In particular, many new
initiatives are being implemented, with the most important being the penetration and thoroughness of
Purpose and Vision.

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As a result of the promotion of various measures, the changes listed on the far right have occurred as output.
As for changes in channels on the upper right, the release of the app for investment trust, which had been
under consideration for some time, resulted in an increase in non-personal sales from 22% to 54%.
As noted in the middle right-hand column, the change to activity targets has led to a nearly doubling of thenumber of interviews, which is gradually but firmly linked to sales performance. We believe that the way
business is done is steadily changing in a tangible way.
In addition, as noted in the lower right-hand corner, customer satisfaction has increased in the monthly NPS
survey, and the Purpose and Vision have been permeated in employee engagement as well.
Although positive changes have been seen in the output, we believe that it is very important to take firm steps
to verify the actual situation as described in the center of the report.

8Regarding the understanding of the actual situation, we are proceeding with both internal and external
evaluations. First, let me talk about internal evaluations. As part of our efforts, we are working to gather
feedback from employees and workplaces through the engagement survey (top left), compliancequestionnaire (bottom left), and internal hotline system.
By analyzing the results of various surveys, such as engagement surveys, 360-degree assessments, andcompliance questionnaires, it is now possible to identify which workplaces have problems and which groups
in those workplaces are experiencing problems. This allows the Bank to take appropriate action in a timely
manner.
In addition to surveys and questionnaires, we also collect direct on-site opinions through FD on-site hearingsby the second line, as described above right, and the Purpose and Vision penetrate project team, which also
includes outside participants.
Such opinion gathering highlighted the issue that some staff members felt there was a gap in the award system,
for example, because of the change in the award system. Believing that more careful dissemination wasneeded to fill this gap, we conducted a lecture on FD by an outside lecturer to branch managers, who are thekey to penetration in the field. In addition, sales policy briefings are held for sales branch managers and staff
in charge.
In addition, I have initiated new meetings to exchange opinions with staff members and am continuously
conveying my thoughts in my own words.

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Next, I will discuss external evaluation. The CX indicator in the upper left corner is a system for quantitatively
measuring customer CX and is positioned as the most important indicator for verifying whether the numberof fans of the Bank is increasing.
In surveying CX indicators, the Bank also analyzes issues that need to be prioritized by understanding thedifference between evaluations and expectations with respect to the various values the Bank provides to its
customers. The results of this analysis and the customer feedback received in the survey will be firmly
reflected in each of our measures.
The NPS shown on the right side is conducted monthly for customers who made financial product transactions
and is improving. We also received many positive comments in the survey about the Okane no Basket or
Money Basket, which we will discuss later.
In addition to the above, the Customer Support Monitoring Office, newly established on the second line, playsa central role in collecting and analyzing customer feedback, in addition to direct interviews with customers
by headquarters staff. We regard customer feedback as a valuable source of information for the Bank’s growth,and we will analyze the true causes of complaints, requests, and inquiries based on a thorough analysis, andapply the results to improvements.

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From here, I will explain in more detail the four initiatives for improvement and prevention of recurrence.
The first point is the penetration of the Purpose and Vision. Once again, we see this as the most important
initiative common to all issues. We are working in unison across the organization to permeate each of the
Purpose and Vision, FD Policy, and Human Resources Development Policy.

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In the activities of the Purpose and Vision penetrate project team, which was newly established last December
and in which outside participants also participate, we organized that the process of penetration of Purpose
and Vision involves the processes of awareness, understanding, and sympathy and spontaneous action.
For the first process, awareness, we are working to spread the Purpose and Vision by displaying it on businesscards, internal notices, and PC screens so that executives and employees can see it at all times, as shown in
the upper left-hand corner of the page.
In addition, we published our revised FD Policy last October and established a new FD Handbook for internal
use at the Bank. The FD Handbook includes the basic customer-oriented stance and approach that applies toall operations, the spirit of bad-news-first in internal reporting, and the three pledges I mentioned earlier. We
distribute the handbook to all employees and read them together on a daily basis as a bible to ensure thatthey always keep the three pledges in mind.
For the second process, understanding, we hold monthly FD study sessions as described in the center, and weare continuously working on specific examples of customer complaints received on our website and having all
staff think about why this happened and what we should have done about it.
In addition, as noted in the upper right corner, we are recommending that staff, including headquarters staff,
view a video that clearly outlines examples of desirable behavior at sales branches, divided into OK and NG,
and about three-quarters of the staff have already viewed the video.
In addition, as shown in the middle row, the Bank’s officers regularly hold meetings to exchange opinions withsales branches and group companies. The Bank strives to instill a sense of unity and awareness of reform inall employees, including those at group companies, by directly communicating the Bank Group’s goals to all
employees and directly answering employees’ questions and concerns.
In addition, the Group CEO, CRO, and CBO continue to distribute messages to all Group employees on the
23rd of each month as FD Day.

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For the third, sympathy and action, the Purpose and Vision penetrate project team is playing a central role incross-organizational and unified efforts. The opinions of staff obtained from in-depth dialogue through thetwo subcommittees of the Penetrate PT and other groups, various surveys and questionnaires within the Bank,and external opinions such as CX surveys and NPS questionnaires will be collected by the PT. We will thenevaluate and reflect on existing efforts and consider new measures, thereby ensuring that the PDCA cycle
functions properly.

13Here are a few more details for Sympathy and Action.
The top row shows the main opinions collected from staff at branches, headquarters, and group companies
through the activities of the Purpose and Vision Penetrate Project Team and other means. There were many
comments from the sales branches, headquarters, and group companies that they are all thinking about theissue, understanding it as their own, and putting it into practice, indicating that the concept has penetrated
at a certain level.
On the other hand, we recognize that the challenges have become more apparent because a certain level ofpenetration has been achieved. For example, sales branches commented that they felt as if they were being
told that they were not acting in accordance with the purpose in the field because the transmission fromheadquarters was too strong, and that they in the field want to be more trusted.
From this opinion, we recognized once again that fostering a sense that the Group is united in putting
customers first must start from the inside. Just as we have changed the term “grievance handling” to“grievance response” in the past, we have immediately begun to change, even if only gradually, the way we
express messages from our headquarters.
As described in the lower part, the personnel evaluation has not been directly linked to the Human Resources
Development Policy. However, in order to make the evaluation system more conducive to motivating
employees appropriately, we have completely revised the behavioral evaluation items in the personnel
evaluation in accordance with the Human Resources Development Policy since April of this year. In addition,
we have incorporated elements of FD into both personnel evaluations and bonus assessments.
Although it is expected that it will take time to permeate and thoroughly implement the Purpose and Vision,a culture change, and it may be difficult to see results, we will continue to work steadily to make it take rootin the Group.

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I will now explain the second initiative, the establishment of the business operation system. We recognizethat the problem with the business operation system was a problem with the so-called incentive mechanism.
There are two main measures for improvement and prevention of recurrence. First, we completely eliminatedincentives related to customer referrals to Chibagin Securities, as well as eliminated profit targets for the
personal division in the performance award system and eliminated incentives in the personal businesses.
We then proceeded to revise the evaluation system to place more emphasis on FD efforts to pursue the bestinterests of customers and the volume of activities such as interviewing customers.
Second, we have strengthened our ability to make comprehensive proposals in personal businesses.
Specifically, in addition to strengthening our four major investment trust measures, we are also training
specialists who can provide comprehensive consulting services to individuals.
Details are explained on the following pages and beyond.

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The four major investment trust measures are listed in the upper left corner. The first is to provide highly
convenient non-personal channels, including app investment trusts. Second, we will improve customers’
financial literacy by building an asset management portal site. Third is specializing in paperless, detailed
explanations of investment trust procedures. The fourth is the introduction of advanced consulting proposals
through the use of the Okane no Basket, a proposal tool.
In addition to the app investment trust, portal site, and paperless system, the number of effective interviews
with customers will be improved by revamping to activity assessment. We will also improve our sales staff’s
ability to make proposals through portfolio proposals that meet customers’ needs by Okane no Basket andthrough group training and video training by Chibagin Academy.
As a result, we hope to avoid any negative impact on sales performance due to the elimination of theindividual profit target and conduct sustainable personal businesses.
Results from each of the measures are gradually beginning to be seen: The number of effective interviews has
doubled from the previous fiscal year, and sales performance is on a recovery track after bottoming out in
October immediately after the elimination of the individual profit target. In addition, we have been focusing
on proposing the new NISA both face-to-face and non-face-to-face, and have been steadily expandingtransactions with new customers, with the current amount of new NISA sales since the beginning of 2024
being approximately five times that of the previous year.

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The proposal tool, Okane no Basket, aims to contribute to clients’ long-term stable asset formation andimprovement of their profit/loss ratio by proposing portfolios based on their goals and risk tolerance for inperson clients.
As shown in the middle right-hand side, a survey of customers who have used the service shows that 86% of
the responses were positive, indicating that many customers are satisfied with the service.
Through these four major measures, we will continue to help our customers realize affluent lifestyles.

17This page explains the goal of personal businesses through the use of data. This is our goal for digital marketingand data-driven sales activities.
Our DX strategy to date has resulted in an increase in touch points with customers and digital transactions, as
shown in the pyramid on the left. From these, we feel that we are now able to accumulate more data. Until
now, only simple attribute data could be obtained from account-holding customers, but as transactions
through digital tools increase, it will become possible to accumulate information on customer behavior andother data.
By analyzing this data, we are able to gain a clearer picture of our customers’ lifestyles, interests, and concerns,
and are increasing the resolution of our customers. Based on these, the headquarters will promotepersonalized digital marketing to account holders.
In addition, as shown in the pyramid on the right, we will return the results of this analysis to our sales
branches to build a system that will enable them to make proposals to their customers at the appropriate
time.

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This is a diagram that puts the shift to digital customers and the promotion of product use into concrete
examples.

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From this point forward, I will talk about strengthening our internal control system.
With regard to the internal control system, we recognize that there were problems in the first line, second
line, and third line, respectively, as described to the left. In the first line, three elements were created:
motivation, opportunity, and justification. The second and third lines had problems with risk detection andinadequate responses to detected risks.
As for improvement measures in the first line, we are firmly raising awareness as a risk owner by spreading
the Purpose and Vision and FD mentioned earlier, and also strengthening functions such as training forinternal control managers and introducing tools for conformity checks.
In the second line, a general manager in charge of corporate management, who has the same rank as thegeneral manager of the sales division, has been appointed to strengthen the check-and-balance function andvoice of the administration division. In addition, we will centrally manage customer feedback, including
complaints, requests, inquiries, and survey results, in order to enhance the sophistication of our analysis. In
addition, the Service Quality Management Division was integrated into the Compliance and Risk Management
Division to strengthen the check-and-balance function for the first line, and the monitoring office was newly
established in the same division to strengthen the monitoring function.
In the third line, I have become the director in charge of the Audit and Inspection Division and am
fundamentally reviewing its activities, as well as strengthening support for the Audit and Inspection Divisionof Chibagin Securities.

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The functions of the second line are explained on this and subsequent pages. The Customer Support
Monitoring Office, newly established in October last year, will play a central role in this effort, treatingcomplaints as valuable customer feedback, taking them seriously, and faithfully applying them to improve
management.
Specifically, complaints, requests, and inquiries to the Group from various angles are collected, compiled,analyzed for causes, reported to management through committees and management meetings, and discussed
at board meetings for management improvement.
In the past, we have analyzed complaints to identify the causes of complaints and to improve our response.
However, the improvements were only limited to measures that were attributable to individual cases.
Since the establishment of the monitoring office, we have been addressing and improving individual cases
based on a composite view of the causes leading to complaints. Furthermore, we analyze the true cause of
the problem, consider whether or not it is necessary to prevent recurrence across the business, and provide
guidance on corrective measures and effective monitoring. In the future, we will improve the accuracy ofanalysis of customers’ voices by introducing system tools and other measures.
In addition to conventional monitoring, we are also promoting monitoring to directly confirm interactions
with customers in order to increase effectiveness and checks and balances. In addition to conducting monthly
NPS questionnaires to investment-type financial instruments clients, the monitoring office has started directinterviews with customers and trial recording monitoring during interviews with customers.

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I will now explain the analytical tools and recording monitoring during transactions that we are currently
working to implement.
The figure on the left is a tool for collecting and analyzing customer feedback that is being considered for
implementation. Regarding customer feedback, complaints, requests, and inquiries received through allchannels, including face-to-face, chatbot, and website, will be centrally managed by the monitoring office andcompiled into a database, which will be used to improve operations and enhance monitoring.
Current collection and analysis methods include channels that are not fully collected due to inadequate
systemization, and channels that do not collect the real voices of customers due to manual recording. With
the introduction of a new collection and analysis tool, we aim to collect and centrally manage all customer
feedback, enabling early detection and analysis of risks and seamless linkage to the competent departments,
with the PDCA cycle running at a high speed.
As for the recording of transactions shown in the figure on the right, we are experimentally recording
customer interviews at the time of sales of financial products using business-use smartphones at threebranches as a more effective monitoring method to prevent fraud and checks and balances against FD.
Interviews will be conducted with sales branches regarding the challenges of actually conducting recordings
for customers, and the development of such recordings for all branches will be considered in the future.
Since actual customer responses can be checked through recordings, we believe we can conduct more
effective CRM monitoring than we have been able to do so far.

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From this point forward, I will talk about the strengthening of business management system.
We believe that there were two problems with the business management system. The first is the issue ofgroup governance. We believe that there were problems with group governance, including problems inunderstanding the current situation, identifying issues, and managing the progress of instructions, which
resulted in delays in responding to the problems identified in the recent business improvement order.
The second issue is organizational culture. We believe that there were problems in the organizational culture,such as a lack of awareness that complaints are valuable customer feedback, which should be taken seriously
and utilized to improve management.
Efforts for improvement and prevention of recurrence include integrated group management of humanresources and the establishment of a new Group Improvement Office.

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I would now like to explain the advancement of our governance structure. In addition to the Bank’s
governance structure chart, as a new initiative, the Chairman of the Board was changed from the Chairmanof the Board to Director Takayama, an outside director, as shown in the upper right corner.
We will further strengthen our management oversight function to improve our ability to respond to a rapidlychanging environment. We also believe that further stimulating discussion will be facilitated and encouragedby the Chairperson of the Board to speak, which will promote discussion from more diverse perspectives thanever before. In addition, we believe that having an outside director as chairman will enable more objective
management of the Board, including the selection of proposals.
In addition, the Bank has appointed its first female representative director, and plans to propose a reductionin the term of office of directors from two years to one year at the annual general meeting of shareholders
scheduled to be held in June.
In addition, the introduction of a performance-linked restricted stock compensation plan will be proposed at
the meeting.

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As previously announced in a press release, at a meeting of the Board held on March 22, 2024, the Board
reviewed the executive compensation system, discussed and resolved to introduce a performance-linked
restricted stock compensation plan, and decided to submit a proposal regarding this plan to the general
meeting of shareholders scheduled to be held in June 2024.
In order to provide an incentive to sustainably increase corporate value, the Bank is considering theestablishment of appropriate KPIs.
As a mid-term performance link, we are considering KPI items such as consolidated ROE for financial items,
CX indexes for customer engagement for non-financial items, the percentage of positive responses in theengagement survey, the ratio of women in leadership positions and above, and progress in carbon neutrality.

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In light of the problem of management’s inability to properly understand the current situation, including thatof group companies, the Group Improvement Office was newly established as an organization that reports
directly to top management, and through direct interviews with headquarters, sales branches, groupcompanies, customers, and others, accurately understands the actual situation on the ground and proposesmeasures for improvement.
The 360-degree evaluation of the headquarters organizational unit described is an example of this activity.
This 360-degree evaluation at headquarters is a survey of sales branch staff regarding their evaluations andreactions to each of the headquarters’ divisions. The unsigned questionnaire provided many candid opinions,and by disclosing the survey results to all officers and employees, it provided a good opportunity to learn how
the head office is viewed by the sales branches.
In response to the survey, the Group Improvement Office conducted hearings with each division of the head
office and is already working to improve those divisions and offices that have problems in dealing with sales
branches and those that can respond quickly.
In addition, we are implementing cross-departmental improvement activities based on shared recognition ofissues that require a certain amount of time to resolve, such as proposals for operations and products, andthe way personnel should be allocated.

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Here you see a list of major measures at Chibagin Securities. There are 46 measures in total, broadly divided,
and this list includes the major measures among them.

27In order to realize the new business model, Chibagin Securities will not receive active customer referrals from
Chiba Bank during the current mid-term business plan period but will focus on follow-up services for existingcustomers. While working to restore relationships of trust, we are giving top priority to strengthening ourbusiness management and internal control systems, which has been a challenge, as well as to internal training.
Based on this, we intend to establish a new business model and aim to return to profitability from the next
medium-term management plan onward, while taking into account the status of internal system development.
That is all for the explanation. Thank you.

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