Our Path of Continuous GrowthMission

Passing on the spirit of Eiichi Shibusawa to the next generation
Eiichi Shibusawa
1840 - 1931; born in Chiaraijima
Village, Hanzawa-gun, Musashino
Province (present day FukayaCity, Saitama). He exerted all hisefforts toward establishing modern
companies and created Japanese
capitalism with the power of theprivate sector.
photograph: Fukaya City

1977.91983.2

1990.11

Opened the Tokyo
BranchHead Office relocatedto a new building at
Sendai Chuo 3-chome

Established The 77
Card Co., Ltd.

Upgrade the New
York Representative
Office to the New
York Branch

1985.10
Current Head Office

1960

1970

1980

1990

2017.6
Building housing the Shanghai
Representative Office

1998.4
Established 77 BusinessSupport Foundation

Opened the London
Representative
OfficeName changed to The 77 Bank, Ltd.

1880

Started business of 77
Securities Co., Ltd.

2000

2006.11
Established the Aomori Corporate
Sales Office

2010

2021

Started“Vision 2030”

Transition to a company with anaudit & supervisory committee

2018.7
Established 77
Research andConsulting Co., Ltd.

Strategy1898.3

Tokyo Branch
Shibusawa warehouse during the Meiji
era, where the first Tokyo Branch of The
77th National Bank was located2017.4Opened theShanghaiRepresentativeOffice

Va l u e1882.72005.7

VisionThe Bank was founded in 1878 as The 77th National Bank. Through thetremendous efforts of Eiichi Shibusawa, the core of our bank was created, and weembarked upon the path we have followed to this day. The theory of corporatesocial responsibility that Shibusawa advocated around the late 19th and early
20th centuries became the focus of renewed attention by the American economist
Peter Drucker, and has since become the global mainstream for present-day
business activities. The Bank will grow in a sustainable manner, while passing onthe spirit of Shibusawa to the next generation in the form of our dedication tobusiness activities that serve the prosperity of the state and local communities.

2020
Leading company creating a path to the future

1978.10The Bank Creed established as thebasic principle of management

Established 77 Shin-Yo Hosyo
Co., Ltd.

1932.1

1978.12The current The 77 Bank, Ltd. was establishedthrough the merger of The 77 Bank, Tohoku
Jitsugyo Bank, and Gojo Bank

Established Tohoku Jitsugyo Bank, Ltd.

1893.5

1988.10
Increased capital to ¥22.2 billion

1974.11
Established 77 Lease Co., Ltd.

1973.8Established Miyagi Savings
Bank（Renamed Gojo Bankin 1921）

Share listing changed to the Firs Sectionof the Tokyo Stock Exchanged

Started operation of the common use system（MEJAR）

2016.51999.3
Abolished the New York
Branch and London
Representative OfficeOpened the Singapore Representative Office
Singapore Representative
Office Established1999.8Merged The 77 Card Co., Ltd. And 77 Credit
Services Co., Ltd., with The 77th Card Co.,
Ltd. as the surviving company

2016.7
Established 77 Capital Co., Ltd.

2016.7
Established 77 Securities Preparatory Establishment Co., Ltd.
（trading name was changed to 77 Securities Co., Ltd. in January 2017）2016.9Established the Hachinohe Corporate Sales Office

1878.121972.10

1997.122016.11

Started operations as The 77thNational Bank

Shares listed (Second Section of the Tokyo Stock
Exchange and the Sapporo Securities Exchange)

Established 77 Credit
Services Co., Ltd.

Converted 77 Lease Co., Ltd., 77 Shin-Yo Hosyo Co., Ltd., andThe 77 Card Co., Ltd. into wholly-owned subsidiaries

Head Office at the time of our foundation in 1878
(former Hinoya site)

Eiichi Shibusawa, who supported The 77 Bank at the time of our establishment

The photograph in the possession ofthe Shibusawa Memorial Museum.

02

2016.1Opened the New York
Representative OfficeEiichi Shibusawa, a businessman who was known as “the father of Japanese capitalism,” had a strong
interest in the Tohoku region through Munenari Date, who provided him with the opportunity to enter theMinistry of Finance. At the time, there was no bank based in Miyagi Prefecture and partially for this reason,prior to the opening of The 77th National Bank, Shibusawa provided advice on various matters, such as thenature of the banking business and basic management concepts, and guided the establishment of the Bank.
Subsequently, he continued to provide investment as a shareholder, and seconded exceptional talent,including Keishi Endo (the second and fourth President) and Seikei Ono (the fifth President) from The Dai-Ichi
Bank Limited. Furthermore, Shibusawa provided both mental and practical support to the Bank over manyyears, including his transfer of The Dai-Ichi Bank Limited’s banking business in Miyagi Prefecture to The 77th
National Bank and his appointment as Advisor in 1909.
Eiichi Shibusawa’s spirit of “harmony of morality and the economy” lives on today in the line from the Bank
Creed, which describes the Bank’s management philosophy, that states “the Bank’s progress goes hand inhand with prosperity in the local community.”

FinancialSection

1910.6

Celebrated the 100th anniversaryof our founding. Increased capitalto ¥12.0 billion

1988.4CompanyInformation

1961.5

Bank Creed
The Bank’s mission is to absorb funds and create credit by exercising its own creativity based on the principle of self-responsibility, in a
spirit of maintaining orderly credit conditions and protecting depositors, and thereby contribute to the growth of the national economy.
In light of such public mission, the Bank shall contribute to the local community while seeking a harmonious balance between
self-interest and public interest as a regional bank.
Based on the aforementioned principles, the code of conduct to be observed by any and all persons employed by the Bank is set forth
as follows.
1. Elevate the Spirit of Voluntary Service
Acknowledge that the Bank’s progress goes hand in hand with prosperity in the local community, and seek to elevate the spirit ofvoluntary service at all times.
2. Improve Creditworthiness
Bear in mind that credit is the Bank’s lifeblood, and endeavor to improve credit at all times.
3. Nurture the Spirit of Harmony
Recognize that the spirit of harmony is fundamental to the execution of duties, and strive to nurture such spirit at all times.

THE 77 BANK INTEGRATED REPORT| 03

The Economy and Potential of Miyagi Prefecture▼▼¥(21.0%) during the period FY2010, immediately after
the financial crisis of 2007-2008, through FY2018
Fisheries and aquaculture
production amount¥billion

Publicly assessed land prices
in Miyagi Prefecture (changein percentage)

since the Great East Japan Earthquake

2●Manufactured good shipment amounts
6.00

Population

4.00

Persons

1,006,676
Number of new housing starts

3.97

4.02

4.47

Third Hokkaido
Prefecture%

2012

2013

2014

2015

2016

2017

2018

Source: Tohoku Bureau of Economy, Trade and Industry%in Miyagi Prefecture
Commercial district: Increasing for eight consecutive years
8.0
Residential district: Increasing for nine consecutive years

4.0

Agricultural output

193.9

1.4

2.0

billion0.0

Commercial district

4.8

1.7

2.5

2.3 2.3

3.2

2.4

1.9

Residential district
(%)

6.2

5.9

6.04.7¥1.0●Publicly assessed land prices (change in percentage)

2.00
0.00

1.2

4.67

SecondMiyagi Prefecture

3.5

3.5

2.7

Secondin Japan

1.2

Third inJapan

1.0

0.0
2013

2014

2015

2016

2017

2018

2019

2020

2021

Source: 77 R&C Monthly Research Report, April 2021

Wholesale/retail annual product sales¥

11,554.9

Number of private sector offices

102,026

billionFinancial
Section

14,451

3.73(JPY tn)

First

Residential Hokkaido PrefectureFirst Fukuoka Prefecture
district
Third MiyagiPrefecture

CompanyInformation

Number of households

3.42

4.11

FirstFukuoka PrefectureCommercialdistrictbillion

Strategy

7,282km

78.9

Fourthin Japan

Va l u e

4,665.6

billionSecond highest growth rate

Manufactured goods shipment amount¥9,463.9

Ranking among prefectures in terms of Gross Prefectural Product (nominal)

Increasing for seven consecutive years

Total area

2,292,385

Gross Prefectural Product (nominal)

VisionThe potential of Miyagi
Prefecture, in numbers

MissionMiyagi Prefecture, which is our main business base, is located in the southeast area of the Tohoku region, and is a key transport hubconnecting the Greater Tokyo Area with the Tohoku region. Additionally, the prefectural capital, Sendai, which became the 11th city
designated by government ordinance in Japan in 1989, is home to the branches of many major companies from across Japan, andfunctions as a core city in the Tohoku region. Miyagi Prefecture generally ranks around 15th among the prefectures in terms ofpopulation and key economic indicators such as the Gross Prefectural Product and total retail sales. It generally accounts for a shareof just under 2% of the national totals of such indicators.
Although Miyagi Prefecture experienced significant damage due to the Great East Japan Earthquake, particularly in coastal areas,
it has made steady progress thanks to joint efforts by the public and private sectors. In addition, with the expansion of major
automotive and electronics companies, the manufacturing industry is expected to become a driver for post-recovery economic growth
while economic concentration is advancing owing to active construction investment related to redevelopment projects in Sendai.

No. 1 in japan interms of thegrowth rate
Offices since
the last survey (2012)

Source: “2021 Shape of Miyagi (Miyagi Prefectural Handbook” *Excluding publicly assessed land prices (change in percentage) in Miyagi Prefecture

Regional Development Project (1)Regional Development Project (2)Sendai Urban Restructuring Project

Next-generation Synchrotron Radiation
Facility Maintenance Project(project launched by Sendai City in October 2019, to continue through FY2031)◆Reconstruction of obsolete buildings andpromotion of corporate relocation into the city

・Establishment of “Subsidy System for Promoting
Building Reconstruction in Sendai City Center”
・Relaxation of floor-area ratio with a view toward“developing highly functional office”
・Enhancement of business attraction framework andsubsidy systems, etc.

06

(Scheduled to begin operation in FY2025)◆Economic ripple effects (estimated by Tohoku
Economic Federation)

Image of Urban Restructuring Project (Sendai Stationarea) Provided by: Sendai City・JPY 1,901.7 billion over the first 10 years of operation
・Local ripple effects within Miyagi Prefecture is JPY
277.7 billion
・The project is believed to contribute particularly in the areas
such as fuel cell, gene drugs and nanocarbon materials

Next-generation synchrotron radiation facility (image)
Provided by: Photon Science Innovation CenterTHE 77 BANK INTEGRATED REPORT| 07

Value Creation Processes

Leading company creating a path to the future

1 satisfaction strategy
Top customer

2

Doubleproductivitystrategy

3

Regional growthstrategy

4

Corporate culture
reform strategy

2030

Becoming a leading company
creating a path to the future

MissionWith the market expected to shrink as a result of the aging society and low birthrate,falling population, and other factors, the 77 Bank Group will work to ensure the prosperityof local communities by inspiring and accumulating trust with the optimal solutions. At thesame time, we will also aim to become a leading company tapping new areas ofopportunity in Miyagi and Tohoku together with our stakeholders.

VisionCreating value with solutions to social issues
The 77 Bank Group's source of value creation

Market contraction

Financial capital

Aging society withlow birthrate◆Capital adequacy ratio (domestic standards, consolidated): 10.39%◆Ratings: JCR: AA, R&I: A, Moody’s: A3 (as of July 31, 2021)

Manufactured capital◆Number of branches: 143 (128 in Miyagi, as well as Sapporo, Morioka, Kitakami, Akita,Yamagata, Fukushima, Koriyama, Soma, Haramachi, Taira,Onahama, Nihonbashi, Tokyo, Nagoya, and Osaka)

Financial◆Corporate sales offices: 2 (Aomori and Hachinohe)

Intellectual capital

Nonfinancial◆Group companies: 6 companies◆MEJAR system(Shared with Bank of Yokohama, Hokuriku Bank, Hokkaido Bank, and Higashi-Nippon Bank)

Local communities●Create abundant local communities◆Know-how on business reform and corporate rehabilitation support
through the recovery from the Great East Japan Earthquake

Employees

Human capital
Digital transformation

Ongoing financial easing

More regulatory easing●Offer workstyles based ondiverse values◆Number of employees (consolidated): 2,812◆Number of employees with qualifications: 141 1st grade Certified Financial
Planner, CFP, 32 Small and Medium enterprise Management Consultants,
20 Movables Valuation Advisors, 21 Agricultural Management Advisors, 2In-house attorneys, 1 In-house certified public accountant

Shareholders

Social capital◆Deposit share in Miyagi Prefecture: 57.3%

Ranked No. 1 in Japan for 24 consecutive years in terms of the shareof deposits in the prefecture (FY3/1997–FY3/2020) (Source: KINYU JOURNAL)

Financia lSection

Lifestyle changes

Customers●Improve customer happinessthrough problem solving andenhance corporate value◆Overseas representative offices: 2 (Shanghai and Singapore)(77 Lease, 77 Shin-Yo Hosyo, 77 Card, 77 Securities, 77 Research and Consulting, 77 Capital)

Social diversification

Consulting

Creation value

CompanyInformation

Lack of corporate successors

Provide the optimal solutions

Strategy◆Deposits and certificates of deposits: ¥8.5 trillion (ninth among regional banks)

Falling population

Concentration in Tokyo

Va l u e

Social issues we aim to solve through our businesses

Expand our fields of activity●Offer growth and returns
together with the 77 Bank Group◆Loans and bills discounted share in Miyagi Prefecture: 43.1%

Response to disasters, etc.

◆Number of comprehensive cooperation agreements signed with
regional public bodies for regional revitalization: 38(Miyagi Prefecture and 35 municipalities in the prefecture, as well as 2 municipalities in Fukushima Prefecture)

Disasters, COVID-19◆Certified “Platinum Kurumin,” “Gold Certified Company,” “Eruboshi (Grade 3),”and “Health and Productivity Management Organization 2021 (White 500)”◆Chosen as a constituent of MSCI Japan Empowering Women Index

Climate change◆Management Philosophy that inherits the spirit of Eiichi Shibusawa’s“harmony of morality and the economy”* As of March 31, 2021, for those without a date

Elevate thespirit ofvoluntary
service

Improvecreditworthiness

Nurture thespirit ofharmony

Bank creed

Enhance corporate value04

THE 77 BANK INTEGRATED REPORT| 05