Integrated Report
2018
Annual Review
April 2017 – March 2018

Mizuho Financial GroupOur Corporate Philosophy

Mizuho, the leading Japanese financial services group with a global presence and a broad customer base, isProviding customers worldwide with the highest quality financial services with honesty and integrity;
Anticipating new trends on the world stage;
Expanding our knowledge in order to help customers shape their future;
Growing together with our customers in a stable and sustainable manner; andBringing together our group–wide expertise to contribute to the prosperity of economies and societies throughout
These fundamental commitments support our primary role in bringing fruitfulness for each customer and the

Corporate
Philosophy:
Mizuho’sfundamental

Mizuho’s Corporate Identity

approach to businessactivities, based on the
raison d’être of Mizuho

Vision:Mizuho’s vision for
the future, realized
through the practice of
the Corporate Philosophy

The Mizuho Values:
The shared values and principles ofMizuho’s people, uniting all executives andemployees together to pursue our Vision

1

Customer First:

Innovative Spirit:

Team Spirit:

Speed:

Passion:The most trusted partner

Progressive andDiversity and

Acuity andCommunication andlighting the future

flexible thinking

collective strength

promptness

challenge for the future

Mizuho Financial Groupcommitted to:

the world.
economies and the societies in which we operate. Mizuho creates lasting value. It is what makes us invaluable.

2018 Integrated Report2

Editorial policy

Contents

This Integrated Report includes financial information as well as
non-financial information on such subjects as ESG. The reportpresents information on Mizuho’s efforts related to strategies,
governance, and other subjects along with information on
how those activities are leading to the creation of value for ourcustomers, society, and Mizuho over the short, medium, and longterms. It was edited with the intention of providing stakeholders
with concise and clear explanations in a story-like form.
The content of this Integrated Report was reported to the Audit
Committee of Mizuho Financial Group, and, after verification of
appropriateness by the Disclosure Committee, the report wasgiven final approval by the President & Group CEO.
We hope this report will further improve understanding of Mizuho
and its goal of being “the most trusted financial services groupwith a global presence and a broad customer base, contributing
to the prosperity of the world, Asia, and Japan.”
Guidelines referred toInternational Integrated Reporting Council’s “International
Integrated Reporting Framework”(published on December 2013)
Scope of the report
Period covered: From April 1, 2017 to March 31, 2018
Also includes some information after April 2018
Scope covered: In principle, Mizuho Financial Group and its
subsidiaries and affiliates

About Mizuho

5
Our goals

17

Publication information
Date of issue: September 2018
Definitions
MHFG: Mizuho Financial Group
MHBK: Mizuho BankMHTB: Mizuho Trust & Banking
MHSC: Mizuho Securities
TCSB: Trust & Custody Services Bank
MHRI: Mizuho Research Institute
MHIR: Mizuho Information & Research Institute
MHPW: Mizuho Private Wealth Management

All figures contained in this report are calculated using accounting
principles generally accepted in Japan (“Japanese GAAP”).
Forward-Looking Statements
This Integrated Report contains statements that constitute forwardlooking statements within the meaning of the United States Private
Securities Litigation Reform Act of 1995, including estimates, forecasts,
targets and plans. Such forward-looking statements do not represent any
guarantee by management of future performance.
In many cases, but not all, we use such words as “aim,” “anticipate,”“believe,” “endeavor,” “estimate,” “expect,” “intend,” “may,” “plan,”“probability,” “project,” “risk,” “seek,” “should,” “strive,” “target” andsimilar expressions in relation to us or our management to identify
forward-looking statements. You can also identify forward-looking
statements by discussions of strategy, plans or intentions. Thesestatements reflect our current views with respect to future events and are
subject to risks, uncertainties and assumptions.
We may not be successful in implementing our business strategies, andmanagement may fail to achieve its targets, for a wide range of possible
reasons, including, without limitation: incurrence of significant creditrelated costs; declines in the value of our securities portfolio; changes
in interest rates; foreign currency fluctuations; decrease in the market
liquidity of our assets; revised assumptions or other changes related
to our pension plans; a decline in our deferred tax assets; the effectof financial transactions entered into for hedging and other similar
purposes; failure to maintain required capital adequacy ratio levels;
downgrades in our credit ratings; our ability to avoid reputational
harm; our ability to implement our Medium-term Business Plan, realize
the synergy effects of “One Mizuho,” and implement other strategic
initiatives and measures effectively; the effectiveness of our operational,
legal and other risk management policies; the effect of changes in general
economic conditions in Japan and elsewhere; and changes to applicablelaws and regulations. Further information regarding factors that could
affect our financial condition and results of operations is included in “Item3.D. Key Information—Risk Factors,” and “Item 5. Operating and Financial
Review and Prospects” in our most recent Form 20-F filed with the U.S.
Securities and Exchange Commission (“SEC”) and our report on Form
6-K furnished to the SEC on July 30, 2018, both of which are available in
the Financial Information section of our web page at www.mizuho-fg.
com/english/ and also at the SEC’s website at www.sec.gov.
The contents of this Integrated Report were prepared prior to theannouncement of our financial results for the first quarter of fiscal 2018.
We do not intend to update our forward-looking statements. We areunder no obligation, and disclaim any obligation, to update or alter ourforward-looking statements, whether as a result of new information,
future events or otherwise, except as may be required by the rules of theTokyo Stock Exchange.

3

Mizuho Financial Group

Our strategies forcreating value

31

Foundations forour corporate value

71

Financial andcorporate data

99

Appendix110

1

Our Corporate Philosophy

5

Mizuho’s journey

7

Business domain

9

Value creation process11

Principal financial and non-financial data

15

Mizuho in fiscal 2017

Index by purpose

Our performance11	Principal financial andnon-financial data
15

Mizuho in fiscal 201799	Six-year major financial data
(FY2012-2017)17 Message from the Group CEO
25 Message from the Group CFO
		 29Business strategy

Communication with shareholders and investors

7

Business domain

31	Medium-term business plan
31	Medium-term business plan
progress

Business strategies by company/unit
		 43

Retail & Business Banking Company

33	Our fundamental structural reforms

		 47

Corporate & Institutional Company

35	Changing the future of financial
services through digital innovation

		 51

Global Corporate Company

		 55

Global Markets Company

		 59

Asset Management Company

		 63

Global Products Unit

		 67

Research & Consulting Unit

37

71

Sustainability

Corporate governance		 72	Interview with the Chairman of theBoard of Directors
75 Board of Directors

79

Risk governance85

Compliance88

Fiduciary duties

89

progress
33	Our fundamental structuralreforms
43	Business strategies bycompany/unit

ESG information(environmental, socialand governance)

IT strategy

91	Corporate culture and employee
engagement
96	Compliance with international
financial regulations
97

Stakeholder communication

37

Sustainability

71

Corporate governance91	Corporate culture andemployee engagement99	Six-year major financial data
(FY2012-2017)

105 Office network
107 Corporate profile100	Review and analysis for fiscal 2017

108 Group companies

110 Compliance contacts

125 Business continuity management

Support for SMEs and regional111	126 Senior executives

revitalization

128 Location of offices outside Japan140	Financial Data of Mizuho Financial
Group, Inc. [Under Japanese GAAP]
232	Non-Consolidated Financial Statements

112 Internal audit structure

131 Investor informationof Mizuho Financial Group, Inc.

113 Risk management structure132	Financial Analysis [Under Japaneseand Three Subsidiaries [Under

GAAP]Japanese GAAP]
246 Basel Regulatory Disclosures
322 Disclosure Policy

2018 Integrated Report4About Mizuho

Mizuho’s journey

Always standing at theforefront of our time,
trailblazing is in ourDNA

Mizuho’s history

1873
The Dai-ichi Bank
(photo: National Diet Library)

1880

The Dai-ichi
Kangyo Bank
1873 Establishment of
The Dai-ichi Bank 1971
Establishment of theDai-ichi Kangyo Bank
through a merger with
Nihon Kangyo Bank

2002

1999

Divided the organization
based on customer
segments through asplit-off and merger

Establishment of afinancial services
groupFirst in JapanThe Fuji Bank
1880 Establishment
of Yasuda Bank, 1948
Changed to The Fuji
Bank

2002

Yasuda Bank
(photo: National Diet Library)

1902(photo: The Mainichi)

First in JapanThe Industrial
Bank of Japan
Establishment as apublic-sector bank that
not only offers longterm funding but also
securities and trust
banking services

Establishmentof Mizuho Bankand Mizuho
Corporate Bank

1999

Merger of our threepredecessor banks

History of the financial industry

5Phase I (1980s and prior)Phase II (1990s)

Phase III (2000s)

Commercial banks, securities companies andinsurance companies coexisted independently

Era of conglomerates andmega banks

Era of investment banks andproprietary trading

Mizuho Financial Group

1992

1996

Financial system
reformJapanese “Big Bang”
financial reformAbout Mizuho Mizuho’s journey

2016

2014
2012

Transition to a Company
with Committees model ofcorporate governanceOperations based on groupwide collaboration amongbanking, trust banking, andsecurities functionsFirst as a Japanese
megabank

Introduced an “in-housecompany system”

First as aJapanese bank

De facto “One Bank”
model in preparation
for merger

2013

2011

Mizuho Trust & Banking and
Mizuho Securities become
wholly-owned subsidiaries
of Mizuho Financial Group

Merger ofbanks and mergerof securities
companies

2014

Strengthening functionsof the holding company

2016

2006

Introduction of in-house company system

Listed on NYSE

Phase IV (2010s and onward)
Pursuit of the new frontier of financePursuit of ideal model for finance

2008

2010

2013

Global financial
crisisUS Dodd-Frank Act

Phase-in introduction of Basel III

Tightening of regulations

2018 Integrated Report6About Mizuho

Business domain

The Mizuho group is composed of Mizuho Financial Group Co., Ltd. (the holding company), its consolidated subsidiaries, andaffiliates accounted for under the equity method. As a financial services group, our business domains include banking, trust banking,securities, and other financial services.

Under a holding company, the group has five in-house companies, which determine and promote strategies group-wide acrossbanking, trust banking, securities, and other business areas according to the attributes of customers, and two units that support allof the in-house companies.

Mizuho Financial Group
Banking

Trust banking

Securities

MizuhoBank

MizuhoTrust&BankingMizuhoSecurities(MHBK)(MHTB)(MHSC)

Retail & Business Banking Company

Corporate & Institutional Company

Global Corporate Company

Global Markets Company

Asset Management Company

Global
Products Unit

Research &Consulting
Unit
Other core groupcompanies* US Bank Holding Company, which is one of MHFG’s coregroup companies and MHBK’s subsidiaries

7

Mizuho Financial Group

Mizuho Americas*

About Mizuho Business domain(group aggregate, management accounting, rounded figures) (¥ billion)

Reference

Net Business Profits by in-house company

FY2017 results

FY2018 targets

Retail & Business Banking Company

1431

Corporate & Institutional Company

229

244

Global Corporate Company

92

123

Global Markets Company

186

285

Asset Management Company

17

18

In-house company total

538

701

Consolidated Net Business Profits

538

700

1. Recalculated the FY2017 results based on the FY2018 management accounting rules
2. The Global Markets Company’s Net Business Profits include Net Gains Related to ETFs and MHFG’s
Consolidated Net Business Profits include Net Gains Related to ETFs (MHBK + MHTB) + Net Gains on Operating
Investment Securities (MHSC consolidated)

Asset
management

Research &consulting

Other core groupcompanies

MizuhoPrivateWealthManagement(MHPW)

Customers
Individual customers / SMEs /middle-market corporations
Large corporations / financial
institutions / public-sector entities

Americas / EMEA /East Asia / Asia & Oceania
Investors
AssetManagement
One

Investors
MizuhoResearch
Institute(MHRI)
MizuhoInformation& ResearchInstitute(MHIR)

Trust andCustodyServicesBank(TCSB)

2018 Integrated Report8About Mizuho

Value creation process

Mizuho’s Corporate Philosophy, which is at the core of our Corporate Identity, states “These fundamental commitments support our primary role inbringing fruitfulness for each customer and the economies and the societies in which we operate. Mizuho creates lasting value. It is what makes us
invaluable.”
To realize our Corporate Philosophy, we are drawing on our strengths, taking account of changes in the business environment in Japan and overseas,and seeking to establish a new business model with the objective of becoming a “financial services consulting group” by taking the One Mizuho

Mizuho’s Corporate Identity

Medium- to longterm changes in thebusiness environment
Rising global political andeconomic uncertainty(Spread of protectionism,geopolitical risk, etc.)

Mizuho’s strategy

Medium- to longterm CSR policy
Medium-term
objective

A financial services consulting group

Fully implement the “customer first

One Mizuho strategy
Provide services for eachcustomer segment on a groupwide basis under the in-housecompany system

Japan’s aging society anddeclining birthrate andpopulation

Pursue operational excellenceprinciple” (customer-focused)

Retail & Business Banking Company
Corporate & Institutional Company

Global Corporate Company
Global Markets Company

As customer needs become more

Rapid advances in digitaltechnology

complex, develop strategies based on
customer attributes

Asset Management Company

Deploy the consulting capabilities of

Global economic growth,
especially in Asia

the group’s asset management andGlobal Products Unit

research & consulting functions in

Research & Consulting Unit

addition to our banking, trust banking,Finding solutions to social
issues, such as climatechange and growing
inequality

and securities functions

In-house companies and units

Mizuho’s strengths

Corporate GovernanceRisk GovernanceRisk-taking capabilities
Human andintellectual
capitalStrong workforceN o. 1 in industrial expertiseamong Japanese banks
Sophisticated productcapabilities

Social andrelationshipcapitalPrincipal financial and non-financial indicators

9

Mizuho Financial GroupP43-70

P11-14B road customerbaseE‌ xtensive networkand digital channels

About Mizuho Value creation process

strategy to the next stage. Specifically, with the “customer first principle” (customer-focused perspective) and operational excellence as the foundationsof our efforts, we will draw on our sophisticated risk-taking capabilities and financial intermediary functions, in order to thoroughly align with ourcustomers’ needs and be their best financial solutions partner, thus shaping the future of the economies and communities we serve.
We are seeking to establish competitive advantage and to increase our corporate value by securing sustainable and stable profits, and therefore fulfill aneven greater social mission.

Increase corporate value and fulfill even greater social mission
Unchanging value as a financial institution

Our customer’s best financial solutions partner,
contributing to the sustainable growth of ourcustomers and the communities we serve

Provide superior consulting services
and optimal solutions
Customers
Individuals, small and medium-sizedenterprises, middle market firms
Large corporations, financial institutions, public-sector

Americas, Europe, East Asia, Asia & Oceania
Investors

Address customers’ issues
and contribute to theirsustainable growth
Contribute to sustainableeconomic and social development
Promote industrial development thattakes into consideration global issues
Revitalize regional economies
Encourage household financial asset growth
in Japan by fulfilling our fiduciary duties

Investors
Business domains

P7- 8

Support business/asset succession andinnovative companies
Create/revolutionize businesses using
new technology
Promote responsible investment andfinancing ur strategies forOvalue creation

P31-70Financial intermediary functions

Financial
capital table funding
S
structureSound credit
portfolio
Strong capital base

Further enhancing Mizuho’s strengths

2018 Integrated Report10About Mizuho

Principal financial and non-financial data

Financial data
Historical data(¥ billion)

Consolidated gross profits

2,025.3

1,996.6

1,806.9

Profits (losses) attributable to owners of parent

2,003.0

560.5

484.5

413.2

239.4

2,171.7

2,035.2

688.4

2,247.7

2,221.6

670.9

611.9

(588.8)FY2008FY2009FY2010FY2011FY2012

Proportion of non-interest income* (gross profits)(Group aggregated, management accounting)

FY2013

FY2014FY2015

 oan balance1
L
Non-performing

In JapanNon-interest
income54%

Non-interest
incomeNet interest
income46%

Net interest
income58%

FY201542%

JPY/USD

Outside Japan (¥ tril-2

112.6919.2

FY201753.9
1.00

FY2018 target approx. 60%* The scope of companies aggregated under management account has been changed since 1Q of
FY2017

Expense ratio (group aggregated)*

 apanese stockJ
portfolio*(%)(¥ billion)

72.1

FY2018 target
Higher end of the
60-70% range

FY2015FY2017FY2018* The scope of companies aggregated under management accounting has been changed since Q1of FY2017

Mizuho Financial Group

1,962.9

1,847.1

March 31, 2015

March 31, 2016

Original target
approx. 60%

60.0

11

FY2015

1 Excluding loans to MHFG, Banking
account* Other securities which have readily

About Mizuho Principal financial and non-financial data

Common equity tier 1 capital ratio*(%)

1,915.3

2,092.7

8.77

576.5

603.5

FY2016

9.27

March 31, 2016

FY2017

March 31, 2017

10.15

March 31, 2018

* Basel III fully-effective basis (based on current regulations), excluding net unrealized gains onother securities(Period-end balance), MHBK + MHTB
loan (NPL) ratiolion)

Non-performing Loan (NPL) Ratio (%)

112.20106.27

Consolidated ROE*
(%)

10.0

19.4
53.8

19.1
54.8
1.00

0.66

FY2016FY2017

2 Foreign exchange rate (TTM) at the respective
period end

Consolidated

Acquisition cost basis

Compared with March 31, 2015-¥398 billion

8.5

FY2015FY2017

 ash dividend per share of common stock,C
dividend payout ratio

Cash dividend per share (¥)

7.5

1,687.5

FY2016* Excluding net unrealized gains on other securities

7.7

1,564.8

Dividend payout ratio (%)

7.5

7.5

31.4

33.0

27.8
March 31, 2017

March 31, 2018

FY2015FY2016FY2017determinable fair values

2018 Integrated Report12About Mizuho

Principal financial and non-financial data

Non-financial data
Our customer base generates our competitive advantage
Individual customers ME, middle market,
S
and business ownerborrowers

24 million 100,000

 overage of listedC
companies in Japan overage of Forbes
C
Global 200 (non-Japanese

corporations)

70%

80%

Stable global presence
Syndicated loans

Underwriting amount¥8.9 trillion

 ssets under management by
A
Asset Management One

No.1 in Japan(9 consecutive
years)

Standings in major league tables
2015
Total equity underwriting
worldwide

3

No.

Total Japan publicly
offered bonds

No.

ABS lead manager

No.

2016

4

No.

3

No.

1

No.

($ million)

No.

2

1

No.

1

Ranking (share)

12.7%

Market share

18.9%

Source: Dealogic

Gross profits

10th

Market shareNo.

1¥57 trillion

Largest scalein Asia

US bond (DCM) ranking*

2017

4

About

9th
(3.5%)

13th(2.9%)

9th(4.8%)
172

166

FY2016FY201713094(3.6%)

Market share

33.0%

FY2014FY2015* Bonds worth $250 million or more, issued by investment grade US
corporations

M&A advisory for announced deals(Japanese corporations)Industry top-level net inflow of client assets

2nd(Number of deals)

1st

1st

169

182

218

(Mizuho Securities)($ trillion)  Mizuho
Independent firm A
Independent firm B

1.7

1.7

1.4

0.7

0.7
0.3

0.0
FY2015FY2016FY2017FY2015

13

Mizuho Financial Group

(0.3)

(0.4)

FY2016FY2017

About Mizuho Principal financial and non-financial data

ESG-related data roject finance deals arranged for renewableP
energy divisions Source: Bloomberg New Energy FinanceNumber of people provided financial education(Number of people)($ million)

15,147

2nd

12,859

2,417
1,907
1,432

2013

2014

6,763
1,560

1,607

2015

2016

5,386

2017

 ercentage of management positions filled byP
women* Figures as of July(%) 

General manager equivalentManager equivalent and above
Supervisor equivalent and above

22

24

8,015

FY2013

FY2014FY2015FY2016FY2017

 ercentage of management positions filled byP
employees hired outside Japan*(%) * Ratio at Mizuho Bank outside Japan

27
40

43

33
12

15

4

4

5

FY2016FY201710FY2018*T otal for four group companies in Japan: Mizuho Financial Group, Mizuho Bank,
Mizuho Trust & Banking, and Mizuho Securities

Social responsibility indices which include Mizuho

FY2015FY2016FY2017* As of July in FY2015 and as of March in FY2016 and subsequent years(as of June 2018)2018 Integrated Report14About Mizuho

Mizuho in fiscal 2017

Strategy

June 2017

June 2017

Mizuho Securities have each transitioned

we established Blue Lab forto a Company with Audit and Supervisory

the purpose of creating new

Committee model of corporate governance inbusinesses by making theorder to further enhance Mizuho’s corporate

best use of various advanced

governance on a group basis.

technology.

Mizuho Bank, Mizuho Trust & Banking, andCooperating with Wil Group,

July 2017

September 2017

to engage in securities business in Frankfurt,

launched the first AI score-based lending service

Germany in the process of assessing the impact ofin Japan.

Started preparations for establishing a new company

J.Score, our joint venture with Softbank,the UK’s withdrawal from the EU.

October 2017

October 2017provide finance for environmentally friendly projects.

Guidelines for Corporate Governance Systems issued by Japan’s

Mizuho Financial Group issued its first Green Bond to

In view of rising interest among the general public and the Practical
Ministry of Economy, Trade and Industry in March 2017, Mizuho
announced our advisor system in advance of the commencement of thedisclosure requirements for advisors/consultants coming into effect.

December 2017

December 2017

the exchange of opinions among business leaders regarding

trust banking, and securities entities in the United

the political and economic outlook and its impact on businessStates and improve convenience for clients, we

strategy and digital innovation.

merged the operations of Mizuho Bank (USA) andHeld the Second Global Council Meeting to provide a venue for

To accelerate collaboration between our banking,Mizuho Trust & Banking (USA).

March 2018

Our consolidated subsidiary, Trust & Custody Services
Bank, signed a management integration agreementwith Japan Trustee Services Bank.

15

Mizuho Financial GroupAbout Mizuho Mizuho in fiscal 2017

External recognition“Customer first principle”
September 2017
Mizuho received the Award for Excellence in the Service & Hospitality Awards
given by the Japan Institute of Information Technology, in recognition of the faceto-face systems we developed, including tablets for filling in forms, as part of ourefforts to be a leading provider of in-branch financial services.

Financial innovation
April 2017

November 2017

Mizuho received the grand prize at the Celent

Received the Information Technology

Model Bank 2017 in the category of consumer

Award from the Japan Institute ofbanking channel innovation. We were recognized

Information Technology in recognition

for creating a unique customer experience byof our acting as a driving force inutilizing the humanoid robot Pepper and providing

advancing the digital revolution in

new services for checking one’s balance directly

financial services.

from the messenger app Line.

May 2018
Mizuho was selected as a Competitive IT Strategy Company Stock for the third consecutive
year by the Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange. We wererecognized for our active efforts to strengthen our competitiveness and create new value through technological innovation.

Encouraging the active participation of our workforce
February 2018

March 2018

Mizuho was selected under the 2018

Mizuho was recognized as

Health & Productivity Stock Selection,

being actively engaged inwhich is jointly administered by thepromoting the participation

Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange.

of our female employees, and received

We were recognized for our approach to employee health and wellbeing byNadeshiko Brand designation, conferred jointly

putting into practice strategic workforce health management initiatives.

by Japan’s Ministry of Economy, Trade andIndustry, and the Tokyo Stock Exchange.

Disclosures
November - December 2017

Mizuho received a number of awards and prizes in recognition of our proactive and advanced online disclosure
practices. Our website was recognized for containing in-depth information and being easy to use and understand.

2018 Integrated Report16

Our goals

Message from the Group CEO

Establishing a stronger and more resilient financialgroup which our customers can depend on in the
coming era
The past fiscal year has been an eventful one for the Mizuho group as well as the world at large. In April 2018 I was appointed as the
President & CEO of Mizuho Financial Group (“Group CEO”).
Some of Mizuho’s strengths and unique characteristics are our long history, broad customer base and network in Japan and aroundthe world, and our strong presence in global financial markets. While fully drawing on these strengths, we are aiming to makeMizuho into a stronger and more resilient financial group which our customers can depend on in the coming era. Our customers’
needs are evolving along with changes in the economy, society, and people’s lifestyles. As new fields gain relevancy for ourcustomers, we must be always a step ahead, cementing these new fields as significant strengths for Mizuho.
To our stakeholders, I ask for your continued understanding and support to help Mizuho succeed in this endeavor.

Business environment: Changes in theeconomic/social structure and cyclical factors
Before I go into the details of the direction I would like to pursue
as the new Group CEO, I would first like to provide an overview ofwhat we perceive to be our medium- to long-term businessenvironment.
First of all I would like to discuss the structural changes occurringin the economy and society. As you know, the world is at ahistorical turning point. The basic world order in which capitalism
supports economic growth around the world, which has been inplace in the decades following World War II, is being challenged
by anti-globalization sentiment, social divisions, and othermovements.
At the same time, the growth of overseas economies continues tosurpass that of Japan, and Asian countries in particular are
expected to lead global economic growth over the next 30 years
or so, making Asia an increasingly important region.
Therefore, while challenges to the world order must be observedwith caution, it is essential that we find the best ways to benefit
from global economic growth, particularly the strong growth
expected in other Asian countries.
As for Japan, the nation reached peak population in 2008 and has
now entered an era of declining population. As of January 2018,
Japan’s population is around 127 million, but is expected to be
reduced by around 30% in 50 years’ time. Due to the declining
birthrate, the working age population is projected to decrease by
40% while the portion of the population that is aged 65 or overwill remain around the same, creating an aging society.

17

Mizuho Financial GroupOn the other hand, individual savings and other household
financial assets which were mostly accumulated during Japan’s
period of high growth now amount to over ¥1.88 quadrillion, anumber three times that of Japan’s current GDP, and are expected
to further increase going forward.
Japan typically ranks first or second globally in terms of the ratethat the population is aging, and therefore it is crucial that themassive amount of household financial assets which the Japanese
population has accumulated are invested in areas of high growthpotential. This will not only contribute to the development ofindustries both in Japan and abroad, but also promote stablewealth formation for the Japanese public, therefore playing a keyrole in achieving sustainable growth for the Japanese economy
going forward.
Also, advancements in technology have enabled substantial
increases in productivity. Coupled with the emergence of new
industries, this is leading to increased industry shake-ups globally.
People’s lifestyles are being transformed as well with the rapid
adoption of smartphones and other consumer technology. This isalso leading to a change in the way that people use financial
services.
Cyclical factors, of course, also have a significant impact.
According to research conducted by the International Monetary
Fund (IMF), the global economy expanded at a rate of 3.8% in
2017, the highest level since 2011. The IMF projects a growth rateof around 3.9% in 2018 and 2019, and considering the expansion
in structural demand resulting from technological progress, theworld economy is expected to follow a very positive trajectory. It
is important to note, however, that the world has tended toexperience a financial crisis every ten years or so, and it has
already been ten years since the previous financial crisis. We at
Mizuho are keenly aware of the importance of knowing where weare in the credit cycle and being always on the lookout for
warning signs.

Our goals Message from the Group CEO

Tatsufumi Sakai
Member of the Board of Directors
President & Group CEO
Mizuho Financial Group, Inc.

2018 Integrated Report18

Our goals

Message from the Group CEO

The excess liquidity produced by the ultra-loose monetary policies
implemented by a number of countries following the global
financial crisis has raised the value of assets such as stocks,
bonds, and real estate. However, the US and European countries
are beginning to seek an exit from their monetary easing and weare also starting to see a market correction for certain asset prices.

Not only do our retail and wholesale businesses complement one
another, but they are also highly integrated in areas such as
capital raising and investment or securities distribution andunderwriting. This provides an opportunity for us to enhancebusiness literacy in both retail and wholesale and strengthen
collaboration between the two, thus creating synergy.

We do not know whether this correction is temporary or a signthat the next crisis is imminent, but it seems likely thatcompetition will only become fiercer and that financial institutions
will struggle to increase their earnings.

Next I would like to explain the areas where we are looking toenhance growth potential for both our retail and wholesale
businesses.

In consideration of these changes, we must monitor market trends
with caution and take on appropriate risk in light of what we
expect the future to bring. In other words, the current situation
will test our true worth as a financial institution.

The direction of our business transformation:
Cultivating a resilient business portfolio withbuilt-in growth potential
In light of the business environment described above, I would liketo discuss the direction of Mizuho’s business transformation.
Firstly, if we consider our earnings and business portfolio from an
investor’s perspective, as a listed company, while our high level ofliquidity and our dividends would be viewed favorably, ourearnings power and growth potential would be seen as in need of
improvement.
In order to meet the high expectations of investors, we need towork to improve upon this assessment. To do this, we not only
need to improve our fundamental earnings power but also ensurethat our business portfolio has built-in growth potential. In otherwords, the combination of a stable earnings base and a numberof additional fields with up-side potential is the key to ensuring
medium- to long-term built-in growth potential and therefore
cultivating a resilient business portfolio.
In terms of a stable earnings base, further strengthening ourJapanese retail business is crucial for ensuring Mizuho’ssustainable growth. Our Japanese retail business is a part of theeconomic and social infrastructure in the country and is the faceof our brand, enhancing our presence by building publicfamiliarity. Additionally, our retail business is a stable earnings
base for us, due in part to being composed of a diverse range ofsmall-value accounts. Although the fixed costs associated with
our retail operations are significant, this part of our business isthe most important source of liquidity for us as a financial
institution. Additionally, establishing a stable earnings base inother areas such as our lending and transaction banking
businesses is important.
As for our wholesale business, which is targeted at large
corporations and institutional investors, this part of our businessnot only establishes a presence for Mizuho in global financial andcapital markets, but also has a significant impact on our profits
and is an area with high up-side potential. Also, the products andfunctions provided by our markets and investment banking
businesses are essential to our operations as a whole.

19

Mizuho Financial GroupThe first area is our securities, trust banking, and asset
management businesses, which have significant room to growand which are a key source of differentiation for Mizuho. Goingforward, we will work to further strengthen and expand thesebusiness areas. To do this, we will need to fully draw on Mizuho
Bank’s robust customer base, capital strength, and otheradvantages.
Another area we will focus on is our business outside Japan,
particularly in Asia where we will look to take advantage of thehigh growth in the region. Compared to the period immediately
following the global financial crisis, Japanese banks have less of acomparative advantage, as Western banks have recovered and thecompetition has become more fierce. However, Japan is theworld’s third largest economy, and Mizuho’s strong foundations in
the Asia region as a whole, which is expected to lead global
growth going forward, will be a source of competitiveness for us
when we go up against Western banks.

Strategies in each business field

Having explained our thinking in terms of our overall businessportfolio, I would now like to take a closer look at the strategies
we will pursue in each business field.
Japanese retail business
The first area we will focus on in our Japanese retail business is
helping individuals to shift their assets to more growth-focused
portfolios.
Over the past 20 years, the average rate of return on household
financial assets was 6.6% in the US but less than 0.8% in Japan,
proving the need to encourage a shift from savings to investment/ wealth formation, which will help individuals achieve more
growth-focused portfolios. This not only addresses one of Japan’s
key economic issues but is also a prime business opportunity for
Mizuho.
By leveraging our strengths such as our broad customer base andnetwork, we can identify the shift in customers’ needs at different
life stages or life events and provide optimal consulting services,drawing on the capabilities of not only our banking, trust banking,and securities entities but also our asset management andresearch & consulting entities (what we refer to as the fourth andfifth pillars of our One Mizuho strategy). This will allow us tofundamentally strengthen our business related to assets undermanagement.

Our goals Message from the Group CEO

The structure of our business portfolio

Positioning

Stable wealthformation

Stable earnings base

Aging population/
declining birthrate

Source of liquidity

Need to reduce fixed
costs

Shift to digital
Complementarysynergy

Capital markets
expansion

Need to pursue
upside potential

Companies aiming fordebt-free operations

Source of growth

Companies’
international expansion

Wholesalebusiness

Need to addressearnings volatility

The second area we will focus on is transforming our customer
channels and payment services. We continue to see a decrease in
the number of visitors to our branches while experiencing a rapid
increase in online banking users. The majority of this increase ismobile banking.
The movement to standardize the QR codes used for mobile
payments in the banking industry is also contributing to thetransition to a cashless society, a trend that is likely to truly takeoff in Japan in the near future.
With consideration of how an increasingly large portion oftransactions are taking place online or through smartphones, andwith the aim of directly advancing the movement towards
cashless payments, we will transform our customer channels andpayment services by strategically shifting resources from branch
and ATM channels to online and mobile channels. At the sametime, this will shift the role of branches to one more focused on
financial consulting, an area where a human touch is essential. As
this shift occurs, we will work to further enhance the added value
we provide in face-to-face customer interactions.
Wholesale business
In wholesale, Mizuho’s strength has been our industry andbusiness insight, and going forward we will focus on our markets
business and further globalization.
Of course, capital markets are a central pillar of any capitalist
economy and while reflecting the domestic and global politicaland economic situation, they set interest rates, stock prices, andother values which have a major impact on the financial system

Outside Japan (especially Asia)

Retailbusiness

Growthareas

Securities, trust banking, asset management

Areas to address

Businessstrategies
 hift household
S
assets to more
growth-focused
portfolios
Transform ourcustomer channels
and payment
services trengthen markets
Sbusiness (primary,secondary) espond to clients’R
international
expansion

as a whole, in addition to supplying liquidity. Additionally, eachmarket is interconnected with others around the world andchanges day-by-day in part in reaction to one another.
It is investors’ decisions that ultimately shape the markets andtherefore, as we promote the shift from savings to investment /wealth formation in Japan, the role of investors and capital
markets will become more central to Japan’s economy. At Mizuho,
our sales & trading business still has significant room for growth.
Additionally, the key to establishing competitive advantage in ourbusiness targeting issuers is to enhance our market literacy sothat we can better take advantage of the abovementioned shift.
Until recently, we have grown our corporate financing businesswith a focus on meeting demand for funding, but currently around
60% of listed companies in Japan are running debt-freebusinesses. Therefore, increasing our market literacy is essential
as client needs are shifting. In addition to the above, we will
pursue fees-based business such as advisory services. This, alongwith the effective use of capital (one of Mizuho’s strengths), andtaking on risk appropriately based on our insight into the markets,
will enable us to increase our earnings power.
Another important point to note is that our corporate clients are
increasingly drawing on their technology and capital strength inorder to expand their businesses globally. Among companies
listed in Japan (which are required to disclose earnings broken
down by business segment), the average portion of their sales
originating from outside Japan is around 50%. It is therefore
imperative that we enhance our ability to assist Japanesecompanies with their international expansion. Also, we will use

2018 Integrated Report20

Our goals

Message from the Group CEO

our presence throughout the Asia region as an advantage andprovide cross-regional solutions as a means of enhancing our
support framework for a range of clients, including Asiancompanies and European or American multinationals.

At Mizuho, we are proactively working in partnership with major
vendors and Fintech companies with the aim of creating new
business and providing highly convenient services which are
more closely aligned to customers’ needs.

In summary, in our wholesale business, to complement ourexisting strength in industry/business insight, we will aim toenhance our financial and capital markets literacy and then further
strengthen both these capabilities from a global perspective. At
the same time, we need to increase collaboration between our
corporate finance and institutional investors businesses as well as
further globalize them.

Going forward, we will incorporate technology more directly into
our business strategies and aim to cultivate it as a pillar of ourbusiness. To accelerate these efforts, we will need to enhance IT
literacy on the business side of our organization and enhancebusiness literacy on the IT side of our organization.

Establishing competitive advantage:
Customer-driven and technology-driven
Next I would like to discuss two concepts which are key todetermining how much of a competitive advantage we canestablish in each business field.
The first is that we must ensure our operations are customerdriven, and therefore strengthen our implementation of the One
Mizuho strategy. Mizuho is the only financial group in Japan tooffer a full line-up of banking, trust banking, and securities
functions through wholly owned subsidiaries, enabling us torespond seamlessly to customers’ needs and to implement the
One Mizuho strategy of group-wide collaboration that is one ofour greatest strengths.
In order to further enhance this strength, we must not only
increase collaboration within the group but also ensure that eachpillar of our business (banking, trust banking, securities, asset
management, etc.) are a formidable presence in their respective
industries.
Through a combination of intra-group collaboration andcompetitiveness in each industry, we can enhance the One Mizuho
strategy to a level where it cannot be replicated by ourcompetitors.
Some of the other ways that we will seek to enhance the One
Mizuho strategy are to improve business literacy throughout thegroup and to make our strategies and initiatives more transparent
and qualitative, ensuring that we have a firm grasp on the true
nature of situations.
The second concept that is key to establishing competitive
advantage is to be technology-driven. There is a lot of untapped
growth potential in the finance industry in terms of adopting newtechnologies. Finance connects people’s lifestyles with broader
global economic activity, and therefore there are significant
potential applications for the data and information resources
which financial institutions handle on a day-to-day basis. When
adopting new technologies, not only should they provide ourcustomers with enhanced convenience and higher added value,
but we also must consider how the technology specifically ties
into our business and how to monetize it.
Technology is also the key to improving the efficiency of
traditional finance industry elements such as operations,branches, and staffing.

21

Mizuho Financial Group

This is only the start of our push into the technology field. As new
fields gain relevancy for our customers, we must be always a stepahead, cementing these new fields as significant strengths for
Mizuho. To achieve this goal, we must urgently pursue a new
finance business model which is technology-driven and more
effective, efficient, and more convenient for customers.

Fundamental structural reforms

Reflecting on fiscal 2017
I would next like to reflect on some of the issues that we need toaddress in order to achieve the business transformation we areaiming for.
Reflecting back on fiscal 2017, the business environment proved to
be challenging as the Bank of Japan continued to implement a
negative interest rate policy and the period between US interest
rate hikes was longer than anticipated. However, we were able toachieve Profit Attributable to Owners of Parent of ¥576.5 billion,
surpassing our fiscal year target of ¥550 billion, due to factors
such as increased fee-related revenue (non-interest income) incustomer divisions, a reversal of credit related costs, and profit
from the sale of cross share-holdings. On the other hand,strengthening our earnings power is a remaining issue we must
address, as evidenced by other results such as the decline inConsolidated Net Business Profits.
Given the challenging environment in terms of revenue growth,and considering the major structural changes occurring in theeconomy and society, we announced in November 2017 a plan for
implementing fundamental structural reforms with a view tosecuring competitive advantage in the future and ensuring thegroup’s sustainable growth over the next ten years and beyond.
As part of these reforms, we will aim to further develop the One
Mizuho strategy by incorporating powerful, advanced technology
into our business through open innovation. For example, we will
aim to increase Gross Profits by actively pursuing collaborative
partnerships with other companies, including those outside thefinancial industry, to create new business opportunities. Secondly,
we will optimize our organizational structure and staffing levels aswell as restructure our customer channels as a means ofstrengthening cost competitiveness and enhancing productivity.
(For an overview of the fundamental structural reforms, see page33).
I want to emphasize that decreasing expenses through a reductionin the number of personnel and branches is not the objective of
these fundamental structural reforms, but rather we must
undertake these reforms in order to strengthen our fundamental

Our goals Message from the Group CEO

earnings power. What kind of financial group we are seeking tobecome by implementing these fundamental structural reforms,
or in other words, what our vision is for Mizuho at the end of thisprocess, is something that we must clearly define andcommunicate to our customers, shareholders, employees, andother stakeholders. Their understanding and support of thisprocess is essential.
In fiscal 2017, we made headway on a number of initiatives,
including shifting personnel in Japan from Head Office to thefrontlines, and expanding our scope of risk-taking. In the second
half of the fiscal year, we began to see results, such as improved
performance year-on-year, primarily in customer divisions. To
maintain this momentum, we will include specific initiatives andnumerical targets in the next medium-term business plan andfiscal year business plans.
Initiatives for fiscal 2018
Fiscal 2018 marks the official start of the fundamental structuralreforms, and we are looking to make a strong start on the reforms
which can be implemented immediately.
In terms of optimizing our organizational structure and staffing
levels, we will aim to eliminate or reallocate around 1,300
positions, primarily at Head Office (including Head Office
departments located outside Japan) and group companies. Of
those positions, around 600 will be shifted to the front office orother priority areas, and around 700 will be eliminated throughmethods including limits on hiring based on a medium- to longterm perspective.
As for IT system transformation, our top priority is ensuring astable migration to our next-generation IT system. With theintroduction of the next-generation IT system, the three legacy
systems we currently use in Japan will become unified under asingle system which is leaner and more efficient. This new IT
system is structured by operation/function type, which will lead to
reduced development periods and costs following the migration,in addition to improving processing times by utilizing a cuttingedge core banking system. The system migration will cause someinconvenience to customers, including eight scheduled periods ofdowntime for online services in 2018, but the next-generation IT
system will form a crucial part of our business foundations andbetter enable us to implement the fundamental structural reforms.
Therefore, we have set it as a top management priority and areapproaching the migration with significant care. In addition to thenext-generation IT system, we will centralize or integrate other IT
systems and revise system development processes with the aimof increasing efficiency.
In terms of restructuring our customer channels, in addition to the
11 branches already closed prior to fiscal 2018 we plan to close
another 8 during the fiscal year, for a total of 19 towards our targetof 100 as part of the fundamental structural reforms (a 20%
progress rate).
In order to strengthen our earnings power, we will shift risk assets
from areas we are scaling back from and plan on allocating ¥1.8
trillion in risk assets to focus areas. While remaining cautious ofvolatility in the global economy, we will aim to proactively take on
appropriate risk. Technology and data can also be leveraged bothto enhance operational processes, and therefore increase
productivity, as well as for the creation of new business. We willdevelop specific initiatives for achieving these aims and preparing
for what the future may bring, including by working in partnershipwith external organizations.

Fundamental structural reforms to be started/implemented in fiscal 2018

1

Optimize our organizational structure and staffing levels
Eliminate orreallocate around
1,300 positions 1

2 Transform IT systems

Shift positions to Eliminate
the front office 1
positionsaround 600 around 700

Migration to the next-generation IT system(Fiscal 2018 target)(Starts from June 2018)

 onsolidate back office operations and streamline Head OfficeC
operations in and outside JapanR
 etrain and shift personnel to the front officePut limits on hiring based on a medium- to long-term perspective

 onsolidate and integrate IT systems (information systems,C
treasury & capital markets systems, etc.)
Transform IT operational processes (e.g. automate system
operations and tests)

3 Restructure customer channels

4 Strengthen earnings power

Reduce networkby
19 branches

Merge orclose
10 branches

Combine branchesof different groupcompanies
9 branches

Shiftresources(risk assets)(Total for fiscal 2017 and 2018)

Launch a hub-and-spoke model pilot programInitiate or further develop business partnerships with local
banks

Scale back areas¥-400 billion

Focus areas¥+1.8 trillion(Fiscal 2018 target)

 xpand the scope of risk-taking (PI 2, US non-IG 3, etc.), focus
E
on areas with growth potential (asset/business succession,
S&T 4, etc.)
Balance risk-taking and credit management

1. Total for fiscal 2017 and 2018 2. Principal investment 3. Non-investment grade 4. Sales and trading2018 Integrated Report22

Our goals

Message from the Group CEO

In fiscal 2018, not only will we implement these fundamental
structural reforms, but as the final fiscal year of the current
medium-term business plan, we will also work to complete themeasures outlined in the plan. In order to ensure the long-term
stability of our business and enable us to “go on the offensive” ,we must achieve the targets set out in our medium-term businessplan concerning our Consolidated Common Equity Tier 1 (CET1)
Capital Ratio and reduction in cross-shareholdings, bothindicators of financial soundness. However, unfortunately weanticipate not being able to meet some of the targets in the plan,such as the group expense ratio target, due in part to changes inthe business environment beyond the scope considered likely at
the time the plan was formulated. This is one reason why we view
increasing our fundamental earnings power as a crucial endeavor.

We need to transform our corporate culture

In order to achieve the fundamental structural reforms and realize
our vision for Mizuho, we must become an organization that is
capable of reaching such ambitious goals.
Reflecting on current corporate culture in the Japanese financeindustry, perhaps due in part to the highly regulated nature of theindustry, or perhaps because organizations tend to go on the
defensive when faced with a challenging business environment,
we are often not forward-looking, and as a result, have a tendency
to be overly orthodox and risk-adverse.
At the same time, the industry is undergoing major structuralchanges and the competition is becoming fiercer, so business
opportunities are more contingent than ever on taking on risk. We
must enhance our business/market literacy and ability to obtainrelevant information, determine which risks we should take as afinancial institution, and be proactive and committed to taking on
those risks. In that sense, what we truly need to do to become
more competitive is to transform employee mindsets and our
corporate culture.

23

Mizuho Financial Group

With this in mind, as we pursue our vision for Mizuho going
forward, everyone throughout the group will need to think beyond
their current role, consider what role they should fulfill in order toensure that Mizuho thrives in the coming era, and be passionate
about doing what is necessary in order to fulfill that role. As theworld changes, we want our people to meet these changes
head-on and be motivated and passionate about taking on new
challenges. Just as importantly, we must cultivate a corporate
culture where everyone is encouraging and supportive of thosewith the courage to try something new.
I believe that communication is the key to achieving this. No
matter how large an organization is, people must be able toconnect with others outside of their direct area of work and haveconstructive discussions and open exchanges of ideas andopinions. These daily interactions create a spirit of camaraderie.
That is what makes an organization truly strong.
We will seek to make further progress on the fundamental reforms
in HR management which we introduced, including HR
management which respects the individual; promoting the active
participation of women, non-Japanese nationals, and othermembers of our diverse workforce; and work style reforms whichenable more diverse and flexible work arrangements. Additionally,
we are committed to transforming Mizuho’s corporate culture,including by changing employee mindsets and encouraging
people to take on new challenges.

Continually pursuing effective corporate
governanceIn order to meet the expectations of our many different
stakeholders and to sustainably enhance Mizuho’s corporate
value, it is essential that we continually pursue effective corporate
governance.
In fiscal 2014, Mizuho transitioned to a “company withcommittees” model of corporate governance, and by separating

Our goals Message from the Group CEO

supervision and business execution roles, we were able to speed
up the decision-making process. Additionally, this has enabledmore effective supervision of executive management, including
more transparent and fair executive compensation andappointments as the Nominating Committee and othercommittees, which are primarily composed of independent
directors, are responsible for these decisions. In fiscal 2017, wemade a number of enhancements to our corporate governanceframework. In addition to the Chairman of the Board of Directors
being an independent director, we have now appointed an
independent director to the chairman positions for the threelegally required board committees. Also, our three core groupcompanies transitioned from a “company with a board ofcompany auditors” to a “company with an audit committee”
model of corporate governance.
Going forward, we will continue to be a model of strong corporate
governance in Japan in addition to proactively implementing
global best practices, making every effort to continually pursue
effective corporate governance as befitting a global financialgroup.

These expectations are in line with those we already holdourselves to, as outlined in our Corporate Philosophy. We aim tointerpret these changes occurring in the economy and society inthe context of medium- to long-term risk and opportunity. We
proactively work towards solving social issues by drawing on our
unique capabilities as a financial group, and we ensure that ourbusiness activities are environmentally responsible and respectfulof human rights, all of which ultimately enhances our corporate
value.
Our efforts in these areas have been recognized in a number ofways, including through selection for multiple sustainability
indices. We are keenly aware of the importance of having thefinance industry actively involved in solving social issues,
including those identified in the SDGs, and we plan on further
incorporating these objectives into our business strategies as ameans of proactively contributing to the sustainable developmentof society.
*The SDGs were announced in September 2015 as part of the United Nation’s“Transforming our World: the 2030 Agenda for Sustainable Development”,
composed of goals that the world should aim to address between 2016 and2030.

Contributing to the sustainable development ofsociety
Our Corporate Philosophy, which forms the basis of Mizuho’s
corporate activities, articulates our commitment to creating
lasting value for our customers and the economies andcommunities in which we operate.
We established this Corporate Philosophy in 2013 and at the time
we considered Mizuho’s history, the feedback of internal andexternal stakeholders, and the elements that we believed would
be necessary for thriving in the finance industry going forward.
We reaffirmed that one of Mizuho’s most valuable assets is ourlong history of contributing to the cultivation of Japanese industry
and the sound development of the economy and the communities
in which we operate. Therefore, our Corporate Philosophy
embodies our commitment to continuing to contribute to thesound development of economies and communities around theworld.
Additionally, in the annual survey of employees that we conduct,a consistently high number of respondents select “cares about
what is best for society/the public” to describe Mizuho’s corporate
culture, showing that many of our employees feel that this is apriority for us as an organization.
As I mentioned at the beginning of this message, as the economy
and society undergo structural changes, a variety of social issues
are materializing. In Japan, the need to respond to population
decline and revitalize local economies, and on a global scale, theneed to respond to climate change and human rights issues, arepressing concerns. The United Nations has developed theSustainable Development Goals (SDGs)* to address such issues,and is calling on not only governments but also companies andinvestors around the world to work towards realizing these goals.
Additionally, investors are showing an increasing interest inenvironmental, social, and governance (ESG) factors. Therefore,
expectations are higher than ever regarding companies’
contribution to society’s sustainable development.

Conclusion

In Mizuho’s long history spanning over 100 years, we have been
an integral part of economies and communities around the world,
contributing to their development. As a united group, we will aim
to continue to contribute to the sustainable and stable growth ofour broad customer base and sound economic and social
development throughout the world. To do so, every member ofMizuho must be aware of our proud history and be committed toensuring that Mizuho continues to fulfill our important role in the
coming era, as well as make every effort to provide the highest
quality financial services.
We are committed to making Mizuho a stronger and more resilient
financial group by ensuring that our shareholders, customers, thelocal communities in which we operate, and our many otherstakeholders, understand and support our vision and initiatives,and ensuring that we are an organization which people can trustand depend on.
We appreciate your continued support and will do everything in
our power to exceed your expectations.

July 2018

Tatsufumi Sakai
Member of the Board of Directors
President & Group CEO
Mizuho Financial Group, Inc.

2018 Integrated Report24Our goals

Message from the Group CFO

Establishing a stable profit structure and robust
financial base, taking appropriate risks, andproviding optimal solutions in order to contributeto the sustainable growth and development ofour customers and society as a whole

MakotoUmemiyaMizuho’s financial management principles

Overview of fiscal 2017

At Mizuho, as a financial services consulting group, we aim tocontribute to the sustainable growth of our diverse range ofstakeholders, particularly our customers, the economies andindustries of Japan and countries around the world, and ourshareholders.

In fiscal 2017, the global economy and the Japanese economy
both experienced steady growth. However, Mizuho’s Consolidated
Gross Profits of ¥1.9153 trillion represent a decrease of 8% yearon-year, due in part to factors such as a reduction in Net Interest
Income as a result of continued negative interest rates in Japan, areduction in non-Japanese bond carry income, which is reliant on
US rate hikes, and the need to take additional steps to ensure thesoundness of our bond portfolio by eliminating a certain amountof unrealized losses.

To achieve this, our fundamental approach to financial
management is to establish a stable profit structure and arobust financial base that can withstand changes in the businessenvironment, and to fulfill our sound risk-taking function to help
our customers, local economies, and industries realize growth.

25

Member of the Board of Directors
Managing Executive Officer
Head of Financial Control &Accounting Group (Group CFO)

Mizuho Financial Group

Also, although we enhanced our expense discipline, we
experienced about a 1% increase in General and Administrative
Expenses, amounting to ¥1.4889 trillion. As a result, ourConsolidated Net Business Profits, which represent our
fundamental earnings power, have declined around 30% yearon-year to ¥457.8 billion. As we expect this challenging businessenvironment to continue, strengthening our earnings power isessential.

Our goals Message from the Group CFO

At the same time, in terms of Credit-Related
Costs, we achieved ¥156.3 billion in profit asa result of a reversal of Reserves for Possible
Losses on Loans. As for Net Gains/Losses Related
to Stocks, we achieved ¥272 billion in profit bypromoting the disposal of cross-shareholdings
and by booking Net Gains Related to ETF in themarkets division. As a result of these efforts, weachieved Profit Attributable to Owners of Parentof ¥576.5 billion, surpassing our projection of¥550 billion, although representing a reductionof around 4% year-on-year.
Our Common Equity Tier 1 (CET1) Capital Ratio1,
which is one of the key indicators of capital
adequacy, was 10.15%, displaying a steadyincrease and meeting our medium-term businessplan target (approx. 10% as of March 2019) a
year ahead of schedule.

Outlook for fiscal 2018 andprogress on the medium–termbusiness plan
As the negative interest rate environment is likely
to continue in Japan throughout fiscal 2018,
we expect a further reduction in domestic Net
Interest Income. However, we will aim to makeup for this decrease through a number of efforts

such as increasing Non-interest Income throughour One Mizuho strategy, enhancing our risktaking capabilities, and increasing productivity
by optimizing operational processes. Our goal
is to achieve Consolidated Net Business Profits(including Net Gains Related to ETFs) of ¥700
billion, a year-on-year increase of ¥160 billion, as
an indicator of our earnings power.

 Y2017 Profit Attributable toF
Owners of Parent¥

As for Credit-Related Costs, in fiscal 2017 webooked significant profit from temporary factors,
and in fiscal 2018 we expect a reduction in profit
in these areas, resulting in around ¥20 billion
in expenses. We will therefore aim to achieve asimilar level of Profit Attributable to Owners of
Parent as in fiscal 2017 (¥570 billion).

576.5

billion-¥26.9 billion (year-on-year) Y2017 Consolidated Net
F
Business Profits

The current operating environment is morechallenging than what we anticipated when
formulating the current medium-term businessplan, and therefore we are aiming to “go on theoffensive” in fiscal 2018, working to steadily
increase our earnings power. Unfortunately,
given the current situation it will be difficult
for us to achieve certain targets, such as profit
targets and expense ratio targets. However,
we are on track to achieve our targets in termsof CET1 Capital Ratio1 and disposal of crossshareholdings, which are central to our strategy
of going on the offensive.

¥

457.8

billion-¥205.5 billion (year-on-year)

Financial targets for FY2018

Group
expense ratio3

CET1 Capital Ratio1

Disposal of crossshareholding

FY2018 target

Initial target

Higher end of the
60 - 70% range

around 60%¥550 billion4

Approx.10%
Fiscal year progress towards medium-term business plan targets

Consolidated ROE2

Approx. 8%

FY2015FY2016FY20171

CET1 Capital Ratio

8.77%

9.27%

10.15%

Consolidated ROE2

10.0%

8.5%

7.7%

to Owners of Parent)

RORA (Profit Attributableto Owners of Parent)

1.0%

0.9%

0.9%

Approx. 0.9%

Expense ratio3

60.0%

66.0%

72.1%

¥115.7 billion
reduction¥275.3 billion
reduction¥398 billion
reduction

RORA (Profit Attributable

Cross-shareholdings
disposal4

1. Basel III fully-effective basis (based on current regulations), excluding Net Unrealized
Gains on Other Securities
2. Excluding Net Unrealized Gains on Other Securities
3. Group aggregated
4. Shares listed on the Japanese stock markets, acquisition cost basis, cumulative
amount from FY2015 to FY2018

2018 Integrated Report26

Our goals

Message from the Group CFO

Establishing a stronger financial position
Fundamental structural reforms

Controlling the balance sheet strategically

The objective of the fundamental structural reforms which weannounced in November 2017 is to secure competitive advantage
in the future and ensure the group’s sustainable growth over the
next ten years and beyond. As mentioned in the Message fromthe Group CEO, these reforms are not merely a cost-cutting
measure, but rather a plan for enhancing our earnings power.
However, as the CFO, my focus will be on the expense discipline
aspects of these reforms. By optimizing our organizational
structure and staffing levels, transforming our IT systems, andrestructuring our customer channels, we aim to reduce our
expense level by around ¥100 billion by the end of fiscal 2021,
and by around ¥150 billion by the end of fiscal 2024 (excluding
amortization expenses related to the next-generation IT system).
Fiscal 2018 marks the start of these fundamental structuralreforms and we intend to make a strong start on those which canbe implemented immediately. (See page 33 “Fundamental
structural reforms”).

We have achieved a CET1 Capital Ratio of 10.15%, meeting thetarget set in our current medium-term business plan a year inadvance. However, based on the finalized Basel III reforms which
include revisions to the risk measurement method and otherrules, published by the Basel Committee on Banking Supervisionin December 2017, our estimated* CET1 Capital Ratio will be in
the 8 to 8.5% range, and therefore we need to continue toaccumulate capital. In light of this situation, it is essential that we
utilize the balance sheet efficiently and increase our profitability.
Specifically we need to flexibly reallocate assets from low-return
to high-return areas and from areas we are scaling back oreliminating to areas we want to focus on, with the aim of creating
a more robust and profitable business portfolio.
* Fully-effective basis. When calculating the estimated CET1 Ratio based on the
new regulations, risk-weighted assets associated with Net Unrealized Gains on
Other Securities (stocks) are excluded.

Balance sheet control initiatives for fiscal 2018
Strengthen balance sheet control to enhance resilience toward changing external environment and tightening regulations

Consolidated Total Assets¥205 trillion

As of March 2018:( ) represent changes from March 2017

Yen

Improve risk-return
Reduce low-profitability assets

Accelerate the shift fromsavings to investment/wealthformation
Increase investment productsbalance and accelerate groupwide integrated businesspromotion


Loans:¥79 trillion(+¥1 trillion)

Deposits:¥136 trillion(+¥5.7 trillion)

Securities:¥34 trillion

Non-yenEnhance focus on non-yen
funding costs including
customer deposits
Accumulate customer
deposits systematically(+¥1.8 trillion)
Stocks romote cross-shareholdingsP
disposal to achieve thedisposal target on an
acquisition cost basis

Bonds ully instill early warningF
system reflecting the external
environment conditions
Identify the timing toreconstruct bond portfolio

27

Mizuho Financial Group teadily accumulate RetainedS
Earnings in order to achieve
CET1 Capital Ratio of approx.
10%

Other Assets:¥91 trillion(+¥1.6 trillion)

Other Liabilities:¥58 trillion(-¥1.8 trillion)

Net Assets:¥9 trillion(+¥0.5 trillion)Our goals Message from the Group CFO

Financial management to support
sustainable growth

Disposal of cross-shareholdings
Regarding cross-shareholdings, we assess the meaning of holding
based on criteria such as profitability in light of capital costs, andunless we consider these holdings to be meaningful, Mizuho
Financial Group and our core subsidiaries will not hold the sharesof other companies as cross–shareholdings. In order to maintain astable financial base, it is essential that we reduce share pricefluctuation risk to an appropriate level as it has a significant
impact on our financial situation. For the period from March 31,
2015 until March 31, 2019 (the end of the current medium-termbusiness plan), our target is a reduction of ¥550 billion in the bookvalue of cross-shareholdings. In fiscal 2018 we plan to dispose of
the remaining ¥152 billion in cross-shareholding required formeeting our target.

Progress towards cross-shareholdings disposal targets1(¥ billion)

Reduction amountas of March 2018¥398 billion
1,962.9
1,687.5

1,564.8

Reduction target
by March 2019¥550 billion

Capital adequacy and return to shareholders
A stable and sufficient level of equity capital is essential toensuring Mizuho’s sustainable growth and our ability to meet the
expectations of stakeholders by maintaining our financial
soundness and fulfilling our role as a financial intermediary evenduring times of economic downturn. At the same time, we
understand the importance of our obligation to provide returns to
our shareholders and investors. Therefore, Mizuho continues tocarry out a disciplined capital management policy which maintains
the optimal balance between ensuring capital adequacy andproviding steady returns to shareholders.
To strengthen Mizuho’s capabilities for coping with changes in thebusiness environment, including trends in global financial
regulations, we will work to build a stable capital base to a levelthat is comparable with competing financial groups.
As for our policy to return profits to shareholders, we have
implemented a steady dividend payout policy setting a dividend
payout ratio on a consolidated basis of approximately 30% as a
guide for our consideration. Based on this policy, we have decided
to make cash dividend payments ¥7.50 for fiscal 2017. Goingforward, we will continue to aim to realize steady returns toshareholders.

Steady return to shareholders
Cash Dividend per Share of Common Stock (¥)
Dividend payout ratio (%)

30
March 2015

March 2017

March 2018

March 2019

28

31

33

332

23

1. Shares listed on the Japanese stock markets, acquisition cost basis

6.5

FY2013

7.5

7.5

7.5

7.5

7.5

FY2014FY2015FY2016FY2017FY2018estimates

2. Assuming Profit Attributable to Owners of Parent for FY2017 of ¥570 billion

2018 Integrated Report28

Our goals

Message from the Group CFO

Communication with shareholders and
At Mizuho, disclosing information to our shareholders and investors in a fair, timely, and appropriate manner is a top priority.
In line with our Disclosure Policy, we actively promote dialogue with our shareholders and investors.
We aim to provide many opportunities for shareholders and investors to learn more about our management strategy, corporate
governance, and other relevant topics directly from Mizuho’s management. Such opportunities include the General Meetingof Shareholders and a variety of informational sessions and IR briefings. We are also actively promoting dialogue with ourinvestors outside Japan by providing timely information in English, holding IR briefings outside Japan, having a dedicated IR
representative located in New York, and implementing a number of other initiatives.

Continued dialogue

Initiatives in fiscal 2017

General Meeting of Shareholders

General Meeting of Shareholders

Institutional
investors
and analysts
Apr

Individual
investors

Every year we hold the General Meetingof Shareholders in late June, selecting
a date that does not overlap with othermajor events in order to make it as easy
as possible for shareholders to attend.
Additionally, the meeting invitation
includes a business report (in both
Japanese and English) and is posted
more than a month in advance ofthe date of the General Meeting of
Shareholders.
In 2018 we held the 16th regular General
Meeting of Shareholders on June 22 at
Tokyo International Forum and 2,246
people attended. A video summary of
the General Meeting of Shareholders isavailable on our website.

29

Mizuho Financial Group

Visits to investors
outside JapanIR
briefings

IR Day

May

Jun

Jul

Aug

Sep

Redesigned
website aimed
at individual
investors

Oct

Online IR
briefings

Institutional investors
We hold an online conference, IR briefing, and other informational sessions
after announcing our financial results and these explanations are alsoavailable in video format on our website.
IR Day, our briefing for investors about our business strategies in eachdivision/in-house company, is a regular event we have been holding since2012. In Japan, Mizuho was the first in the industry to hold this type of event.
Based on requests from investors, from 2015 we also added an explanationfrom independent directors and a question & answer session to this event.
From 2015 to 2017 the presenter was Hiroko Ota, the Chairman of the Board of
Directors, and in 2018 it was Tetsuo Seki, the Chairman of the Audit Committee.
Please see our website for a summary of the presentation and the question& answer session. We also provide a range of other opportunities for sharing
information and creating dialogue, including regularly hosting “IR Select”
events which cover specific topics that are of interest to investors.

IR briefings

IR DayOur goals Message from the Group CFO

investors

Constructive dialogue
In addition to opportunities such as theGeneral Meeting of Shareholders andIR briefings, we hold direct meetings
with investors to discuss our businessstrategy, corporate governance, General
Meeting of Shareholders agenda items,
and a range of other topics.
Business strategy(total number, rounded)

Direct meetings 700
with institutional (260 investors
investors
outside Japan)

By seniormanagement

220 (60 investors outside Japan)

By IR Dept.

480 (200 investors outside Japan)

Visits to investors
outside JapanIR
briefings

As part of the process for formulating
the fundamental structural reforms
which we announced in November 2017,
we collected feedback from investors at
IR briefings, direct meetings, and otherforums and shared this feedback with
Mizuho’s executive officers and senior
management for their consideration.
Also, after announcing the structuralreforms we initiated dialogue withinvestors to explain our rationale forthese reforms and to collect additional
feedback.

Appointment of the new Group CEO
Nov

Dec

Jan

Feb

Mar

An explanation of the process
for selecting the new Group CEO(announced in January 2018), including
the recommendations of the Nominating
Committee, was provided in thefollowing materials. (An explanation is
also included in this Integrated Report.
See page 77 “Succession planning”.)

Individual investors

Invitation to the General Meeting of
Shareholders

We are working to make our website targeting individual investors easy tonavigate and understand, having made a number of changes to enhance easeof-use and simplify information such as adding a one-click chart generator that
illustrates financial results.

Corporate Governance Report

In 2015, we became the first Japanese megabank to provide online IR briefings
where investors can communicate directly with the CFO and we continue tooffer these opportunities. In fiscal 2017, around 3,000 individual investors intotal viewed these sessions (including live and recorded viewings).

Website targeting individual investors

Online IR briefings

Proposals by shareholders at the General
Meeting of Shareholders
At the General Meeting of Shareholders
held in June 2017, shareholder
proposals which our Board of Directors
voted against but which received ahigh percentage of votes in favor at
the General Meeting of Shareholders
were delegated for further deliberationby the Board of Directors and theirthinking on these matters was thenpublically disclosed. Additionally, theletter to shareholders sent after theannouncement of first-half financial
results was designed in a question &answer format in order to make theexplanation easier to understand.

In fiscal 2018, we will aim to further
engage investors in dialogue in order toreflect their feedback into our business,
including into the formulation of our next
medium-term business plan. We truly
appreciate your continued support andguidance.

2018 Integrated Report30

Our strategies for creating value

Medium-term business plan progressIn fiscal 2016, Mizuho began to implement its three-year medium-term business plan, entitled Progressive Development of “One
Mizuho”—The Path to a Financial Services Consulting Group.
Under the medium-term business plan, we will perfect the One Mizuho strategy by creating a new business model as a financial
services consulting group. The two foundations for this effort will be the full implementation of the “customer first principle”
promoted in the previous medium-term business plan and the pursuit of operational excellence. Mizuho has also defined 5 basic
polices and 10 basic strategies with regards to business strategies, financial strategy, and management foundations.
Fiscal 2018 will be the final year of our current medium-term business plan, but, as the business environment is becoming
increasingly challenging, it will be difficult to attain the Gross Profits target laid out in the plan. Also, our expense ratio target for
fiscal 2018 is in the higher end of the 60 - 70% range, and therefore we expect to exceed our medium-term business plan target(approx. 60%). However, we are on track to achieve our targets regarding our Common Equity Tier 1 (CET1) capital ratio, reducing
cross-shareholdings, and other key indicators.

Mizuho’s objectives

Financial services consulting group

The most trusted partner in solving problems andsupporting the sustainable growth of customers and communities
Fully implement the “customer first principle”(customer-focused)
5 basic
policies

Introduction of the
in-house company
systemSelecting andfocusingof business areas

Pursue operational excellence

Establishment ofa resilient financial
base

Proactive involvement infinancial innovation

1 Strengthening our model for non-interest income

Businessstrategies

business on a global basis

Embedding a corporate culture thatencourages the active participation of ourworkforce to support a stronger Mizuho

4 Responding to Fintech
5 Promoting the Area One Mizuho strategy

2 Responding to the shift from savings to investment
3 Strengthening our research and consulting functions

10 basic
strategies

FinancialstrategyManagementfoundations

6 Controlling the balance sheet strategically and

7 Disposing of cross-shareholdings

reforming the cost structure
8 Completing implementation of the next-generation

IT system

10 ‌Continued initiatives towards embedding

a corporate culture to support a strongorganization

9 Fundamental reforms in HR management

Financial targets
Targets for FY2018 in themedium-term business plan
CET1 Capital Ratio1
2

Consolidated ROE

FY2015 results

FY2016 results

FY2017 results

approx. 10%

8.77%

9.27%

10.15%

approx. 8%

10.0%

8.5%

7.7%

approx. 0.9%

1.0%

0.9%

0.9%

Cross-shareholdings disposal3¥550 billion¥115.7 billion¥275.3 billion¥398.0 billion

Proportion of Non-interest Income4

approx. 60%

54%

54%

58%

Expense Ratio5

approx. 60%6

60.0%

66.0%

72.1%

RORA (Profit Attributable to Owners of Parent)

1. Basel III fully-effective basis (based on current regulations), excluding Net Unrealized Gains on Other Securities 2. Excluding Net Unrealized Gains on Other Securities 3. Shares listed onJapanese stock exchanges, acquisition cost basis, cumulative amount from FY2015 to FY2018 4. The scope of companies subject to aggregated management accounting has been changed
since FY2017 (FY2015 results are unchanged) 5. Group aggregated 6. Our expense ratio target for fiscal 2018 is in the higher end of the 60 - 70% range, and therefore we expect to exceed our
medium-term business plan target (approx. 60%).

31Mizuho Financial GroupOur strategies for creating value Medium-term business plan progress

Fully implementing the “customer firstprinciple” introduction of the in-housecompany system
To thoroughly strengthen our “customer first principle”
approach and to realize our goal of becoming a financial
services consulting group, we have introduced a new in-housecompany system.
Specifically, Mizuho has established five in-house companies
that formulate and implement group-wide strategies acrossbanking, trust banking, securities, and other group entities, foreach customer segment. Product and research functions havebeen reorganized into two independent units to enhance

expertise and promote utilization across all the in-housecompanies.
With the in-house company system as our base, we will work
to strengthen relationships with our customers, and, by gaining
a thorough understanding of their needs, we will proceed with
the implementation of our One Mizuho strategy. By finding
solutions to the issues confronting our customers, we will work
to strengthen our earnings power.

Pursuing operational excellence
In addition to differentiating our strategies through a focus on
the “customer first principle”, we are pursuing operational
excellence as a means of strengthening strategy
implementation.
To accomplish this, we will thoroughly review our existing
business processes, consolidate common operations andincorporate technological innovation (such as Fintech) and new
ideas. In this way, we are aiming to improve operational
efficiency and to enhance the value of our services by raising
the sophistication of our operations.
We made steady progress on streamlining Head Office
functions, improving operational processes using digitaltechnology such as robotic process automation, andtransforming employee mindsets. Going forward, we will
fundamentally revise our business processes and change theway we go about our work.

Strengthen
costcompetitivenessImprovecustomer
service

Impact on
expensereduction(compared
to FY2015)

FY2016FY2017FY2018Results

Results

Target

¥12

¥38.5

¥70

billionSelecting and focusing ofbusiness areas
As we determine which areas to focus on
and which to streamline, we are flexibly
allocating resources to targeted clients andmarkets, aiming to use our limited resources
as effectively as possible, which will lead to
improvement in earnings power.
In our areas of focus, we will expand ourscope of risk-taking and our depth ofcommitment as we also begin to strengthen
our position in new business and growthdomains.

Transform
mindsetsbillionbillion(rounded figures, ¥ billion)

FY2018 business strategy• ‌Expand assets under management by strengthening our customer-focused business
operations

Retail & BusinessBanking Company• ‌Strategically allocate RWA to focus areas such as customers’ growth strategy andCorporate &Institutional Company/ equity investment, asset finance)• Expand scope of risk-taking (mezzanine• ‌Strengthen investment banking (ECM1, M&A) and real estate-related business
RWA
Streamline -320 Focus +870

business succession
RWA
Streamline -30

Focus +510

‌• ‌Enhance the Global 3002 strategy and enhance our standing, focus on transaction
Global Corporate
Company

Global Markets
Company
Asset Management
Companybanking‌
scope of risk-taking (US non-IG3 strategy, expand base of non-Japanese clients in• Expand

Asia)
RWA

Streamline -50

Focus +460

• ‌‌Optimize portfolio utilization by enhancing markets monitoring• ‌Allocate resources for sales & trading through collaboration between Mizuho Bank andMizuho Securities• ‌Develop asset management products that contribute to the shift from savings toinvestment/asset building and support investment product vendors• ‌Provide comprehensive pension consulting services

1. equity capital markets 2. Group of approximately 300 blue-chip companies around the world that Mizuho focuseson 3. Non-investment grade

Please see the following pages:
P27 - 28 Establishment of a resilient financial baseP35 - 36 Proactive involvement in financial innovation
P91 - 95 Embedding a corporate culture that encourages the active participation of our workforce to support a stronger Mizuho

2018 Integrated Report32

Our strategies for creating value

Our fundamental structural reforms

The business environment continues to be challenging for financial institutions, and major structural changes to the industry are on
the horizon. With this in mind, we are committed to implementing fundamental structural reforms with a view to securing
competitive advantage in the future and ensuring the Mizuho group’s sustainable growth over the next ten years and beyond.
As part of these reforms, we will aim to further develop the One Mizuho strategy by incorporating powerful, advanced technology
into our business through open innovation. For example, we will aim to increase Gross Profits by actively pursuing collaborative
partnerships with other companies, including those outside the financial industry, to create new business opportunities. Secondly,
we will optimize our organizational structure and personnel levels as well as restructure our customer channels as a means ofstrengthening cost competitiveness and enhancing productivity.
The objectives of our fundamental structural reforms are not limited to reducing costs, but we are implementing measures tostrengthen our fundamental earnings power. These reforms fall into four basic categories: (1) optimize organization & personnel, (2)structurally reform IT systems, (3) revisit channel strategy, and (4) strengthen earnings power. We will outline the specific measuresand numerical goals in our medium-term business plan and in business plans for each fiscal year as we move forward with
implementing the reforms.
Overview of the fundamental structural reforms

Direction

Technology utilization

Open innovation (such as alliances with other companies)

Global perspective

Mizuho’s vision (“Financial Services Consulting Group”) and One Mizuho strategy stay unchanged

Continuous fundamental structural reform in order toachieve sustainable growth and secure competitive
advantage for the group as a whole in ten years’ time

Structuralreforms

Detailed measures and numerical targets will be

Framework

reflected in each medium-term business plan (MTBP)
Medium-term business plan
Current MTBP

Next MTBPFY2018

1 Optimize organization & personnel

FY2021

FY2024FY20262 Structurally reform IT systems

Streamline the number of personnel to align withthe business strategy

Improve the quality and quantity of front-office staff



‌

‌

Utilize technology to reduce and streamline working
processes‌

Pillars

3 Revisit channel strategy
Close, merge, and co-join branches in Japan,
following the hub-and-spoke model‌Create omni-channel network to match the nextgeneration finance industry model and increasecustomer convenience utilizing technology‌33

Mizuho Financial Group

Integrate our various IT systems
Implement the next-generation IT system tostrengthen Mizuho’s IT platform

4 Strengthen earnings power
Reformgross profits structureLower
the burden at front offices and increase thenumber of people with sales and marketing skills

Revisit business management

Our strategies for creating value Our fundamental structural reforms

Optimize organization & personnel
As the adoption of new technology has made our operational processes more efficient, we are planning to reduce the number of
personnel to a level that is the right fit for implementing Mizuho’s strategies. We will achieve this by taking into account expected
retirement and turnover in light of our current workforce composition, and taking measures such as optimizing hiring to achieve theright balance for the group as a whole. At the same time, we will seek to increase the number of front office personnel and enhancetheir capabilities through talent acquisition and development as well as by shifting personnel from the back office and Head Office tothe front office.

Revisit channel strategy
We are working to build an optimal and efficient office network, based on the hub-and-spoke model, by grouping offices into about
120 areas nationwide in Japan and designating some offices in core areas as “hub” offices and other offices as “spoke” offices withmore focused offerings and lighter staffing. In parallel with this, we are also closing some offices and combining others for joint
operations as appropriate. At the same time, with an eye to next-generation financial services, we are working to streamline ourservice channels by using technology to enhance both face-to-face and digital channels and increase convenience for customers.

Structurally reform IT systems
As we endeavor to integrate and consolidate IT systems, we are moving ahead with creating a strong IT base through theintroduction of our next-generation IT system. By consolidating our legacy systems, we are reducing the cost of new systemdevelopment and increasing the speed with which we can bring new products and services to market, as well as ensuring a moreequal level of service at all offices/branches.

Strengthen earnings power
As we expand our initiatives in growth domains and expand our scope of risk-taking, we are also working to revise our gross profits
structure by utilizing advanced technology and pursuing collaborative arrangements with other companies outside the financial
services industry. Another key objective is to streamline our Head Office organizational structure and business processes. We willachieve this by reducing the burden placed on the frontlines through the delegation of authority, speeding up credit screening, andother means, while also expanding the number of front office personnel and simplifying business processes. Through these efforts,
we are transforming our revenue structure and strengthening earnings power.
Quantitative image of the structural reforms

Decrease by approx.

Staff

19,000 people

FY2017

FY2021

FY2024FY2026

Approx.
80,000 people

Decrease by
8,000 people

Decrease by
14,000 people

Decrease by
19,000 people

Approx.
500 locations

Decrease by
50 locations

Decrease by
100 locations(compared to March 2017)

Locations inJapanDecrease by approx.

100 locations(compared to March 2017)

Depreciation related to the next-generation IT system

Reduction excluding

Expense reduction

depreciation related to
the next-generation IT

Expenses¥1.45 trillion

Approx.
¥100 billion

Around¥150 billion

Reduce expenses

systemby FY2021 or as

Around¥150 billion

early as possible(Group aggregate, compared to FY2017)2018 Integrated Report34

Our strategies for creating value

Changing the future of financial
services through digital innovation
Mizuho is using cutting-edge technology and collaborating with external organizations
to provide more convenient services for our customers.
Mizuho’s initiatives

Establishment of Blue Lab

As a megabank, Mizuho has built a robust customer base andwealth of industry information and worked to develop strength
in the areas of financial knowledge and technology. In the past,
Mizuho’s business has not always been viewed as strong whenit comes to innovation, advanced technology, and assessmentof a field’s future business potential. In today’s businessenvironment, however, by collaborating with Fintech
companies and major vendors that possess these strengths,
Mizuho is working to create new business and provide moreconvenient services for our customers, and to enhance ourbrand image as a financial institution.

To help develop and commercialize next-generation businessmodels based on both Fintech and IoT technologies, weestablished Blue Lab with the WiL Group, a venture capitalfirm, and other partners in June 2017.
Mizuho’s Chief Digital Innovation Officer (CDIO) was appointed
as president of Blue Lab, and employees from our Digital
Innovation Department were seconded or transferred to BlueLab to create new platforms based on the concept of open
innovation. This environment enables an agile management
style which is particularly conducive to global expansion.

Establishment of Blue Lab

Group CEOCDIO

Digital Innovation Dept.
Approx.

Dedicated
executive
officer

Investment

40 staff

Less than 15% share(not consolidated or affiliated)

CEO

Expected role for Blue Lab

ItochuSompo Japan
Nipponkoa Insurance
The Dai-ichi Life
Insurance Company
The Norinchukin Bank
Marubeni
Sumitomo Mitsui TrustBankand other companies

Secondments /concurrent posts

Employees(Mizuho
generalists)

Investment

Employees(Mizuho
specialists)

Employees ofpartnercompanies

35

Mizuho Financial Group

Create platform
Create a platformthat is beneficial forall participants

Global expansion
Co-creation andinformation
gathering on a
global basis

Agile management
style

IoT incubator company
Established June 2017

Open innovation
Collaborate flexibly
with other industries

Business area:

Finance

Agriculture

Tourism…

Thinking on themoveOur strategies for creating value

Expected effects

Creating new business

Principal initiatives
Activities to develop new
business and optimize
business processes,
including building
settlement platforms
covering overseas
transactions, developing ofsoftware for automating
business tasks using
artificial intelligence (AI) andBig Data, and applying
blockchain with the aim ofincreasing operational
efficiency in supply chain
management (SCM) andtrade finance.

Expanding profits

Examples of Mizuho’s initiatives

Mizuho Wallet

Checking account balances
through Line messenger app

Lending
Asset management support

Business areas
Asset management /Asset management

Lending

investment support

Transfers / payments

Digital currency

Financial information

Utilizing technology
Blockchain

Other collaborative
business operations

Artificial intelligence
Trade finance using blockchain
technology

Big Data

Use of blockchain technology insupply chain management
Automatic entry of data
into business forms
using AI

Robotics and othertechnology

Increasing sophistication of business processes
Case 1
J.ScoreJ.Score was set up in November 2016 as a joint
venture by Mizuho and Softbank, and waslaunched to provide the first AI score-based
consumer lending as a Fintech service in Japan.
In the six months since the beginning ofoperations, business has expanded steadily and
J.Score has provided about
130,000 scores. Loansoutstanding resulting fromthese scores total
approximately ¥3.5 billion, asof the end of March 2018.
In addition, J.Score hascontinued to expand its
cutting-edge services,
including a tie-up with Yahoo!
Japan for usage of information
services (in June 2018), andrelease of a mobile application(in July 2018).

Cost reduction

Case 2
Pilot test of cashless payments in Fukushima
Beginning in June 2018, Mizuho and Toho Bank started pilot testing thePring payments app in Fukushima Prefecture with the aims of revitalizing
the regional economy and promoting wider use of cashless payments toincrease convenience for residents of the region.
1

Deposits into smartphone
apps via accounts ofpartner banks

2

3

QR code-based payment
with smartphones

Settlement of accounts
based on payment data

ChargePayment

Information
sharing

Settlement

Collaborating banks

Pring users

Members (shops)

Pring Co., Ltd.

2018 Integrated Report36Our strategies for creating value

Sustainability
In order for Mizuho to increase its corporate value and fulfill its public mission, in addition to strengthening our financial base,
it is indispensable for us to maintain and strengthen our business foundations, which include our brand, our people, and ourrelationships of trust with our customers and local communities. To do this, we position corporate social responsibility (CSR)
initiatives as key corporate activities and we manage our business with consideration for the creation of value for a variety of
stakeholders. In addition, we strive to ensure that each of our staff carries out his/her day-to-day work with an awareness of oursocial responsibilities and public mission. Also, we are seeking to address environmental, social, and governance (ESG) issues aspart of our CSR initiatives.
We view the changes taking place in the economy and society in terms of medium- to long-term risks and opportunities andprioritize the issues we will address. We then incorporate initiatives to address these issues into our corporate strategy, and draw
on the collective capabilities of the Mizuho group to provide solutions to social issues, including those identified in the Sustainable
Development Goals (SDGs), in order to contribute to the development of a sustainable society and ultimately increase our corporate
value.
For more details on these initiatives, please see our website:

Medium- andhttps://www.mizuho-fg.com/csr/

Principal issues that Mizuho is addressing to achieve sustainable development

Long-term CSR

Social needs that are linked to the risks andopportunities we have identified

Initiative Policy

IssuesCore businessSound economic
growth‌
Returning
to fiscal soundness and revitalizing regionalareas‌Building resilient infrastructure‌Increasing productivity through the application of newtechnology and innovation

Declining birthrate
and aging of the
population, healthand lengthening
lifespans‌Business succession, technology succession‌
Assetformation for individuals and transfer of assets tothe next generation‌Securing a sufficient labor force‌Dealing with expansion in expenditures for medical
treatment and care for the elderly‌Lengthening of the healthy lifespan
Securing access to necessary services

Strengthen efforts topromote businesses
that contribute to
the sustainable
development ofsocietyFoundations

Innovation

‌
Using
technological progress to transform existing
business and create new business‌Nurturing innovative companies and those with newtechnologies‌Dealing with cyber attacks

Making work more
worthwhile/fulfilling‌Promotingdiversity and inclusion, and adopting Japan’s
work style reforms‌Talent development amid a changing operating
environment

Energy and theenvironment‌Ensuringa stable energy supply and preserving theenvironment
Responding to the transition to a carbon-free society
Preserving biodiversity
Securing a stable food supply

Respect forhuman rights‌Preventing/reducing
negative impacts on human rights‌Creating an inclusive society‌Preventing money laundering and the financing ofterrorism

Alliances andcollaboration‌Creating
alliances and collaborative relationships with adiverse range of stakeholders

Reinforce the group’s
foundations that
underpin activities
in line with society’s
expectations

Social contributions
Promote social
contribution activities
that take into
consideration theneeds of local regions
and society

37

Mizuho Financial Group

SDGs related tothese issues

Our strategies for creating value Sustainability

Initiatives in FY2017
Environment/energy,
infrastructure

Case
examplesHealthCaseexamplesP 41,66

Revitalizing regional areas
and economies

Case
examplesP 50

Business succession

Case
examplesP 46

Support innovative companies

Outline

P 45

Support the shift from savings
to investment in Japan

Case
examplesP 62

Create business and innovateby using new technology

Case
examplesP 35,36,46,
58,62,70

P 40,41,70

Responsible investment andfinancing

Outline

P 42

Risk governance

OutlineP 79-84

Promoting employee
engagement

OutlineFinancial education

Results

P 91-94
P 14

Priority initiatives in FY2018
1

Promote initiatives which take into
consideration structural changes* which
impact our clients and society as a whole*United Nations sustainable development goals; low birthrate,
aging society, and declining population; globalization; technologicalrevolution; climate change, etc.

 rovide products and services which contribute to solving
P
environmental and social issues
Solve issues through open innovation and partnerships
with companies outside the financial sector
Create new business and transform existing business byadopting new technologies

2

Strengthening our stance on responsible
investment and financing

3

Strengthen our business foundations on agroup–wide and global basis nhance our corporate governanceEEstablish a stronger corporate cultureEnhance our risk governanceBuild a robust compliance framework
Strengthen our IT governance and system development
framework
Enhance our response to human rights concerns

4

Promote the development and active
participation of our diverse workforce
Promote diversity and inclusion‌Proactive approach to promoting the health and wellbeingof employees, as well as creating a healthy work
environment

5

Promote customer protection management
and financial crime prevention

6

Efforts to reduce the environmental impactof our business operations

7

Continuous initiatives to promote financial
literacy/education

8

Promotion of activities that consider theneeds of the local community

2018 Integrated Report38Our strategies for creating value

Sustainability

Environmental and social initiative highlights
Environment-related efforts
Addressing issues related to the global environment, starting with climate change, is a pressing challenge for all of humankind,and since the Paris Agreement, activities directed toward a carbon-free society are accelerating. We have established Policies forEnvironmental Initiatives and Environmental Targets, and are promoting environmental businesses and seeking to reduce theenvironmental impact of our business activities to support both economic development and environmental protection.

Response to climate change
We support the intent and aims of the Task Force on Climate–related Financial Disclosures* (TCFD)’s proposals and will conduct initiatives
based on the TCFD framework and work toward more advanced disclosure.
*A task force led by representatives of the private sector, established in December 2015 based on recommendations from the Financial Stability Board in order to enhance the availability ofcorporate information related to climate change; issued final report in June 2017.

GovernanceIn formulating our FY2018 business plan (resolved by the Board of Directors), we have analyzed opportunities and risks
related to social issues, including climate change, and planned out initiatives, and we continue to monitor and manage ourprogress on a regular basis. In April 2018, following deliberations by the Executive Management Committee, we established
Policies on Specific Industrial Sectors for sectors such as coal-fired power generation. A report was also made in June 2018
to the Audit Committee on strengthening management systems for responsible investment and financing.
Mizuho recognizes the following risks, opportunities, and impacts on business activities related to climate change, and basedon this will actively promote financial products and services that help mitigate climate change, or facilitate adaptation to it,
including financing for renewable energy projects and issuance of green bonds to transition to a carbon-free society, and wewill conduct appropriate risk management based on international concerns, trends, and other factors.

Strategy

Opportunities‌
Increasedbusiness opportunities, including provision of solutions that support customers intransitioning to a carbon-free society, such as financing for renewable energy projects‌Improvement of capital markets and social reputation through appropriate initiatives and disclosure

Risk

Increased credit risk from reduced asset value for fossil fuelsIncreased reputational risk from supporting financing of companies and projects with highenvironmental impact
Increased costs to comply with stronger environmental regulations and address natural disasters

Impacts‌Business opportunities increasing, centered on consulting services‌Thoughthere’s been no noteworthy deterioration in credit risk short-term, reputational risk increasing

Credit exposure specification, impact assessment, and disclosure related to carbon-related assets will be considered as a
future issue.

Risk
Management

We recognize the physical and transition risks associated with climate change and have constructed a system for addressingthese risks through a comprehensive risk management framework that includes credit risk management and operational risk
management.
Additionally, to mitigate negative impacts on society and the environment, we apply the Equator Principles to large-scale
development projects in which we are involved. For sectors such as coal-fired power generation, we take potential environmental
and social impacts and efforts to address these into account when making our credit decisions (Refer to page 42).
Mizuho sets environmental targets and manages indicators as follows and will continue to consider establishing sciencebased targets (SBT).

Indicators andtargets

Targets

Indicators

39

Mizuho Financial GroupCO2 emissions basic unit: CO2 emissions / total floor area (electricity usage at Japanese facilities of Mizuho
Financial Group and core group companies)
Long–term target
Reduce by 19.0% from FY2009 levels by the end of FY2030
Medium–term target
Reduce by 10.5% from FY2009 levels by the end of FY2020‌Scope
1 (direct) and Scope 2 (indirect) CO2 emissions and energy usage‌Scope 3 Environmental impact related to new large-scale power generation projects(CO2 emissions and CO2 emission reductions)Our strategies for creating value Sustainability

Environmental business

Environmental business in India
In response to the trend toward the use of clean energy and the development of “smart” cities aswell as other related initiatives, we are working to contribute to development in India and provide
assistance from a financial perspective to assist Japanese companies in expanding their businesses
outside Japan and to help Japanese industries implement their growth strategies.

1 First project finance by a Japanese commercial bank for photovoltaic
electric power, generating business in India
Mizuho Bank is providing project finance for the photovoltaic power
generating facility (with a capacity of 350MW) that will be built, owned, andoperated by a subsidiary of the Softbank Group in Andhra Pradesh State insouth India. The project finance loan is co-financed with the Japan Bank forInternational Cooperation, and Mizuho Bank signed the financing arrangement
contracts in September 2017. This
photovoltaic power facility will be the firstsuch project finance deal to be syndicatedby a Japanese bank. Going forward, Mizuho
will work to contribute to the developmentof the Indian economy and to the transition
to clean energy sources through financing ofclean energy projects.
2 Gujarat State

2 “Smart City” development initiative in Gujarat StateIn December 2 017, a consortium with the participation of Mizuho Bank andMizuho Information and Research Institute was selected by Japan’s Ministryof the Environment, Trade, and Industry (METI) to conduct a feasibility study
for creating a smart city development in India’s Gujarat State. This project has
been designated as an advanced model, going forward, for the developmentof a Japanese-affiliated industrial concentration, centering around theautomobile industry, for urban development planning in Gujarat State. The
project will be used for consideration of a medium- to long-term vision andwill involve research on smart infrastructure in which Japanese companies
can participate. Mizuho will be responsible for the planning and operating of
this project in its entirety.

MumbaiChennaiBangalore
1 Andhra Pradesh State

Encouraging sustainable finance that can meet the needs ofinvestors and corporations
We are providing full support for companies raising capital in order to address environmental
and social related issues and encourage ESG investments in the bond markets.

In FY2017, Mizuho Securities strengthened its ESG bond issuance framework by setting up a sustainablefinance desk and concluding a partner contract with the Climate Bond Initiative. Through these and otheractivities, as an ESG structuring agent, we actively supported capital raising through issuing ESG bonds,
including syndication of Mizuho Financial Group’s first green bonds and financing for the first model pilot
project for green bond issuance promoted by Japan’s Ministry of the Environment. These activities wererecognized and Mizuho Securities received the Rising Star award as an SRI Dealer in the Asia/Pacific region
from mtn-i*.

*mtn-i operates an information platform, based in the United Kingdom that issues market analyses and market information.

2018 Integrated Report40

Our strategies for creating value

Sustainability

Addressing social issues
In addition to harnessing our broad financial service functions to support the real economy from a medium- and long-term
perspective, we are working to strengthen our efforts to promote business that contributes to the sustainable developmentof society in response to the renewed expectations of stakeholders. As a financial services consulting group, Mizuho offers
solutions that draw on the unique qualities of our business, and we are working to contribute to the solution of social issues
by reflecting concern regarding human rights and the environment into our business activities.

Establishment of a human rights policy
In consideration of the global nature of our business operations, and in order to fulfill
our responsibilities in terms of respecting human rights, Mizuho endeavors to preventor minimize any negative impact that our activities may have on human rights and takeother measures as needed.

In view of changes in the business environment and the expectations of society, in order to strengthen initiatives related tohuman rights through our business activities, the Board of Directors decided on measures and prepared a Human Rights
Policy in accord with the United Nations’ Guiding Principles on Business and Human Rights in April 2018. When formulating
the policy, to fulfill our responsibilities in the area of respecting human rights, we sought the advice of various outside
specialists and experts in the field of human rights and reviewed the issues involved to decide on specific actions and priority
initiatives.

Participation in Japan’s first social impact bond project
To address social issues, Mizuho public and private sector collaboration, drawing oneach sector’s strengths. A key example of this social impact bonds (SIBs) as a new
approach to investment.

In August 2017, Mizuho Bank, as part of a project led by Hachioji
City in Tokyo prefecture aiming to increase the percentageof persons being tested for colon cancer, participated in the
syndication of a full-scale SIB project, which was Japan’s firstmulti-year, performance-linked SIB project, and provided a portionof the funds invested in a blind partnership. This project was
aimed at extending the healthy lifespans of citizens and improving
the quality of life as well as encouraging the more optimal
medical costs through the early detection of cancer. The project
was targeted at citizens of a city where the ratio of persons
undergoing colon cancer tests was low, and offered tailor-madescreening based on AI. Going forward, Mizuho will continue to
use our financial strengths to contribute to the solution of social
issues through the issuance of SIBs and other methods.

Project outline
Financers

Intermediary support
organization

Hachioji City

1
4

Reports on screening
recipients, cancer
patients diagnosed, etc.

Healthcare
providers

Screening

Private-sectorbusinesses

3

Payment recipients

2

Mizuho Bankand other
organizations

5
1 Performance-linked

payment contract

2 Provision of funds
3 Encouraging cancer

screening

4 5 Payment linked to results

Mizuho signs an advisory service agreement with
the National Water Company of Saudi Arabia
Through cooperation in projects for the privatization of a Saudi Arabian water utility,
we are helping to address the issues related to privatization and safe operation of water
treatment facilities, and thereby contribute to Saudi Arabia’s development.

Mizuho Bank signed an advisory service agreement in February 2018 with the National Water
Company (NWC) of the Kingdom of Saudi Arabia, concerning the privatization of water distribution
services. Saudi Arabia has been promoting industrial diversification and privatization with the goalof reducing its dependence on fossil fuel and other mineral resources. In the water sector, stable
operation of water treatment facilities has become an urgent issue due to the rapid growth inpopulation, especially in urban areas. Based on the agreement, Mizuho, acting as advisor, will
provide NWC with insights and know-how on public-private partnerships, industrial development,
finance, and other areas as it considers the best model for privatization.

41

Mizuho Financial GroupOur strategies for creating value Sustainability

Responsible investment and financing
Mizuho has always proactively promoted responsible investment and financing, and as part of our commitment tofurther strengthening our stance, we established Policies on Specific Industrial Sectors, which affirm our commitment toconsidering risks such as environmental and social risks when engaging in business with clients in certain industries (suchas weapons, coal-fired power generation, palm oil, and lumber) where there is a high possibility that our involvementwith the client could contribute to adverse environmental or social impacts. Based on an awareness of environmental andsocial risks in a wide range of industries, Mizuho Bank, Mizuho Trust & Banking, Mizuho Securities, and Mizuho Americas
will determine whether to extend credit or assist with capital raising for clients in certain industries after confirming themeasures which the client is taking to avoid or mitigate such risks, and other due diligence as appropriate based on thecharacteristics of the services we are providing.
For further information, please visit:https://www.mizuho-fg.com/csr/business/investment/index.html

Consideration for the environment and society in our lending activities
In order for us to promote the sustainable development of society and the economy as well as
contribute to the solution of environmental and social issues through our lending activities, ourlending criteria include determining whether the extension of credit will contribute to the sounddevelopment of the economy and the communities we serve.

We recognize that large-scale development projects may have adverse impacts
on the environment and local communities. Mizuho Bank works together withthe project proponents (clients) to identify and conduct appropriate environmental
and social risk assessments and due diligence for management, as required
under the Equator Principles.1
1. Financial industry standards for identifying, assessing, and managing environmental and social risks related toprojects that are being financed.
2. The items in this graph are those guaranteed by third parties.

Number of projects for which contracts have been signed
and the Equator Principles applied2
Europe, the Middle East, and Africa
Americas

8

47
17
22

FY2015

7

Asia and Oceania

48
29
12

FY2016230

20
8FY2017

Promotion of responsible and ESG investing
By conducting our activities with appropriate attention to our stewardship responsibilities
and promoting the increase in corporate value and sustainability of the companies being
invested in, we contribute to the prosperity and sound development of Japan’s economy
and society.

Mizuho Trust & Banking and Asset Management One are fulfilling their stewardship responsibilities and promoting ESG
investing. Asset Management One, our primary asset management subsidiary, performs many functions in addition to proxyvoting. These include active ongoing engagement, principally regarding the environment, society, and corporate governance(ESG), for those companies it has selected for investment. These activities are also conducted with the aim of raising theoverall level of the market and promoting the medium- to long-term growth of the companies. Moreover, to offer investment
products for a wide range of investors with a focus on ESG, we introduced a new fund, “One ETF ESG”, and offered private
placements of investment trusts for institutional investors.

E‌ ngagement activities(passive investment)

Asset Management One’s responsible investing framework
Clients and beneficiaries (investment trusts, pension funds, etc.)
Sustainable increase incorporate value

Investee companies

Stewardship activities

Engagement
constructive,
purposeful dialogue
Exercise of voting rights

Investment

Corporate Governance Code

ReportingResponsible
Investment
Committee

Asset Management One

Investing,monitoring

ChairmanHead of Investment Division

Members

Deputy-Head of Investment Division, Head and
Deputy-Head of Risk Management Division

Responsible Investment Department
 ngagement (Passive investment)
E
Exercise of voting rights

ESG analysts
Persons exercising voting rights

Equity Investment GroupEngagement(Active investment)

Sector analysts
Fund managers

Japan’s Stewardship Code

Active accounts in FY2017: 159
Share of TOPIX: 30%.
Companies considered forengagement activities
Selected giving consideration
to profitability and degree of
influence from among stocks
included in the TOPIX 500

Conducted discussions toencourage efforts to increase
corporate value
Asset Management One

2018 Integrated Report42Our strategies for creating value

Retail & Business Banking Company

Individual customers

SMEs

Middle market corporations

We aim to work seamlessly
our customers’ needs andOur goals
The operating environment for the Retail and Business Banking
Company in Japan is characterized by a declining birth rate,
demographic aging, and a decline in the population. As a resultof the acceleration of globalization and digital innovation, SME
and middle-market corporations confront increasingly diverseand complex challenges.
Major structural changes are also underway. In today’s
extended period of low interest rates, financial institutions’ keyearnings source, interest income, has declined. What is more,companies in other industries are moving into businessdomains that had traditionally been the province of financial
institutions.
However, we see these changes as an opportunity and areseeking to transform our business model based on a long-term
perspective. In order to pursue a new retail business model,
we are working on providing individual customers, SMEs, andmiddle market corporations with consulting services which
draw on our full range of group capabilities including banking,trust banking, and securities. Additionally, we are adopting

Toshitsugu Okabe
Head of Retail & Business Banking Company

Economic/social environment, customer characteristics• Bank of Japan continues negative interest rate policy• Declining birth rate, demographic aging, and decline inExternal environment

population in Japan• About 50% of total household financial assets of about¥1,800 trillion concentrated in deposits• Trend toward reviewing corporate strategies to takeaccount of structural changes in the economy and society• Aging of SME/middle market corporation owners andshortage of successors• Rapid progress of digital innovation
Competitive & regulatory environment• Competitors moving in similar strategic directions• Emergence of paradigm shift as companies in otherindustries enter the financial sector

43

Mizuho Financial GroupOur perception of opportunities and risks

1. Current environment
Opportunities

Use our strong customer base to offer financial consulting
through integrated group functions• Expand scope of asset management business (promote
shift from saving to investments/asset building)• Expand business succession consulting in view ofchanges in the tax system• Develop new business by utilizing digital innovation• Expand business domains through open innovation(collaboration with other companies)

Risks• Gradual decrease in interest income due to continuing
negative interest rates• Deterioration in business base due to stagnation in
Japan’s economy and society• Intensifying competitive environment as companies inother industries enter the financial sector

Our strategies for creating value Retail & Business Banking Company

with the entire Mizuho group to accurately understandoffer them tailored consulting services.
innovative technology and partnering with other companies inorder to offer customers highly convenient services.
First of all, we are aiming to transform our business with afocus on non-interest income, ensuring that we are thoroughlyaligned with our customers’ needs and providing financial
services that present solutions to the issues they face. In an era
where many of our customers will live to be a 100 years old,
supporting the shift from savings to investment as a means ofpromoting stable asset formation is a core aspect of conducting
customer-focused business operations. We are also working on
expanding our product line-up and improving our customers’
financial literacy.
Another area we are focusing on is providing services tailoredto the needs of SMEs and middle market corporations,
including the formulation of growth strategies, businesssuccession plans, and accessing sources of risk capital. By fully
drawing on the group’s capabilities, we are able to provide
optimal solutions for both corporations and individuals.
Moreover, through the One Mizuho Project, our banking, trust

banking, and securities entities are working together to launch
initiatives in different regions throughout Japan which aim toaddress local issues and contribute to regional economic andsocial revitalization.
In these priority domains, we are concentrating resources
through the reassignment of personnel on a cross-group basis,
strengthening our talent development programs, and taking
steps to boost service quality and productivity.
Further, we are taking advantage of the dramatic advances indigital innovation to develop highly-convenient customer
services and to expand our customer base and earnings.
We are working on a fundamental change in business structure
to enhance customer convenience while controlling costs. Our
initiatives include the development of new business areas
utilizing AI and automation, and boosting operational efficiency
by utilizing our next-generation IT system.

2. Value creation
Value for customers

Value for society• Optimal solutions for a wide range of customer needs via• Facilitate asset building for individuals and the circulation of• High-quality, customer-focused services with a superior level• Contribute to sustainable growth in the Japanese economy byfinancial services consulting that integrates our banking, trust
banking, and securities functionsof expertise and professional ethics• Creating new value through services such as remittances,payments, and asset management by utilizing advances indigital innovation• Sophisticated business and asset succession solutions for

SMEs and middle market corporations confronting such issues
as aging top executives and insufficient human capitalfunds which promotes sustainable growth for the Japanese
economyoffering support for the growth strategies of SMEs and middle
market corporations• Adopt an integrated approach that combines our banking,trust banking, and securities functions to confront local
challenges, and implement initiatives aimed at resolving
issues in alliance with local businesses and citizens

2018 Integrated Report44Our strategies for creating value

Retail & Business Banking Company
FY2017 results and FY2018 focus
Results
Reflecting on our performance in FY2017, the operating
environment was challenging as interest income declined as aresult of the Bank of Japan’s negative interest rate policy andadverse trends in the financial markets. While we were unable
to attain our Net Business Profits target, profits nonethelessrose year-on-year, and our performance was positive overall asa result of group-wide collaboration.

Additionally, we strengthened both our business growth andbusiness succession consulting capabilities, focusing on SMEs
and middle market corporations, as well as provided support
for innovative companies with outstanding proprietary
technology and ideas. As a result, in FY2017 our share as leadunderwriter of Japanese IPOs rose to 20%, which was two
percentage points higher than in the previous fiscal year.

Specifically, to support our efforts to encourage individual
customers to shift from savings to investment, we allocatedmore personnel to customer-facing positions and put increased
emphasis on our integrated banking, trust banking, andsecurities consulting services. Due in part to these efforts, fully
2.58 million customers utilized our investment products in
FY2017, demonstrating a steady expansion of 30,000
individuals year-on-year. Total asset inflows at group securities
companies ranked No. 1 in Japan’s securities industry.

Other accomplishments in FY2017 included the development of
new types of branches that make use of digital technologies,
enhancement of our online and mobile banking services, andother innovations. These initiatives represented further
progress in our drive to enhance the convenience of ourservices for customers.

Future direction
In FY2018, we are further accelerating our strategy of groupwide collaboration and have formulated priority strategies
based on identified customer needs. We are working to makeprogress toward enhancing the sophistication of our traditional
face-to-face channels and strengthening the services available
through our digital channels.
For individual customers, we will enhance our consulting
services to better meet their needs regarding the shift fromsavings to investments and asset succession. We will also
further promote iDeCo1 and NISA2 as a means of assistingcustomers’ long-term asset building while placing greater
focus on enhancing customers’ financial literacy.
For our corporate clients, especially SMEs and middle market
corporations, we will upgrade our solutions functions andstrengthen collaboration with the Research & Consulting Unit

so that we can further evolve our consulting-based support for
their growth strategies and guide them through major events
such as M&As, IPOs, and business succession.
We also plan to accelerate our initiatives related to digital
innovation. In FY2017 we launched a new affiliate, J.Score, andwe will seek to expand this business going forward, in addition
to making progress on other digital business initiatives
developed with alliance partners or by finding new applications
for Big Data.
In addition, we will promote “operational excellence”, revise
work processes - such as making operations of branches andHead Office more efficient by utilizing technical innovations,- and take action to cut costs.
1. iDeCo: Individual-type defined contribution pension plan 2. NISA: Small-lot,tax exempt investment accounts

3. Business plan

Trends in risk appetite

Action plan

• Promote initiatives to establish and embed customer-• Implement sophisticated consulting services that will

focused business operations• Proactively invest resources in key sectors aimed at
augmenting non-interest income• Make efficient use of resources and establish a low-costbusiness model by utilizing digital innovations andexternal alliances

contribute to the asset building of our individual
customers• Provide optimal solutions that support the growthstrategies of our SME and middle market clients• Make our online and mobile services even more userfriendly by utilizing new digital technology• Boost efficiency and productivity by revising operational
processes

45

Mizuho Financial GroupOur strategies for creating value Retail & Business Banking Company

2017 highlights
Trends in performance

(¥ billion) (Group aggregate, management accounting, rounded figures)

FY20161
Items
Performance

For reference:
FY2018 targets2

FY2017
Targets

Performance

Compared totargets

Year-on-year

Year-on-year

Gross Profits

717.2

—

726.2

—

+9.0

—

Net Business Profits

12.4

42.0

15.6

-26.4

+3.2

+17.0

Profits

28.7

27.0

26.4

-0.6

-2.3

+4.0

1. FY2016 results recalculated based on FY2017 management accounting 2. Comparison of FY2017 results recalculated based on FY2018 management accounting

Major KPIs
Balance of assets under management,
number of investment product users¥ trillion

million users

2.58
2.53

35
FY2016

2.55
41

Asset inflows at group securities companies*
FY2015¥ trillion

FY2016FY2017

Number

18

1.7
0.9

19

18%

0.7

37

FY2017

Number and share of IPOs in which
Mizuho was the lead underwriter*

Share

18
20%

14%
FY2018Mizuho Securities(Retail & BusinessBanking Division) Competitor A(0.4)
Competitor B

Competitor C*Prepared based on financial results disclosures of
the respective companies

FY2015
results

FY2016
results

FY2017
results*Prepared based on data from Capital Eye andincludes co-lead underwriter positions, but
excludes REITs and global offerings.

Solutions supporting sustainable growth for our customers and society
Using digital technology to enhance the convenience of in-branch services
In our branches, we have newly set up Mizuho Digital Corners where customers canuse or learn about our digital services. In these corners, we have provided tablet
devices and interactive monitors. Customers can also use their smartphones to accessa range of services, including opening an account, making transfers, and completing
procedures or registering account information. In this way, we are integrating ourdigital channel with our in-branches services.
Going forward, in addition to using digital technology to improve the convenience of
our services, we will continue to assist customers in selecting optimal—primarily
digital—transaction methods, including by making digital consultants available.

Strengthening our ability to meet business succession needs
The lack of qualified successors for the current management of SMEs and middle
market companies, which account for creation of about 70% of jobs in Japan, is one of
the major issues confronting Japan today.
In April 2018, a special act was passed related to the business succession tax system.
With this increased government support for business succession, we arestrengthening our integrated banking, trust banking, and securities functions tofacilitate smooth business succession for our clients by holding forums related to thisissue, establishing a business succession fund, and other undertakings.

2018 Integrated Report46

Our strategies for creating value

Corporate & Institutional Company

Large corporations

Financial institutions

Public-sector entities

Mizuho aims to serve as ourstrengths and providing
Our goals
To explain our goals for the Corporate and Institutional
Company, let us first examine the operating environment we
confront today.
During FY2017, the global economy and Japan’s economy bothshowed steady growth. On the other hand, movements toward
protectionism in the United States, the persistence ofgeopolitical risk, and other factors resulted in the continuationof considerable uncertainty regarding future conditions. In
addition, the monetary policies of central banks in Japan andabroad, and the trend toward tighter regulations regarding thebalance sheets of financial institutions, continue to give rise toconcerns.
On the other hand, the trend among corporate clients in recent
years has been to place substantially greater emphasis on
increasing corporate value and return on equity (ROE). Theseand other trends, beginning with further globalization ofbusiness activities, and following on to realignment of businessactivities across industry lines, M&A, and the movements
toward focusing on core competencies when allocating
corporate resources, are expected to continue.
Moreover, client needs are becoming more diverse andsophisticated due to accelerated digital innovation spurred byadvances in technology, and changes in social and industrial
structures.

Akira Nakamura

Head of Corporate & Institutional Company

1. Current environment
Economic/social environment, client characteristics

External environment

Japan

47

• Further acceleration of globalization• Increasing emphasis from corporate management onenhancing corporate value and ROE• Rising need for revitalization of regional areas in Japan• Rapid progress in digital innovation
Competitive & regulatory environment• Competitors moving in similar strategic directions• Tightening of international financial regulations

Mizuho Financial Group

Opportunities

Our perception of opportunities and risks• Increasing uncertainty in the global economy• Continuing negative interest rate policy by the Bank ofOffering integrated group-wide consulting capabilities
based on strong relationships with clients• Further expansion of securities businesses, including
cross-border M&A• Expansion of asset business opportunities through review
of business portfolio• Increasing public and private sector collaboration in areas
such as agriculture and the revitalization of regional
economies

Risks• Decline in profits due to slow growth in interest income• Decline in added value provided by existing financebusiness• Further restrictions on balance sheet management

Our strategies for creating value Corporate & Institutional Company

clients’ most trusted global partner, focusing our collective
solutions for increasingly diverse and sophisticated requirements
Next I would like to take a closer look at the strengths of our
in-house company and the issues we must address going
forward. Our strengths include the strong relationships andclient base that we have built among large corporations,financial institutions, and public sector entities. Another area ofstrength, arising from our drive to meet client needs, is ourcapability for sophisticated risk-taking cultivated through thedevelopment of new financial business. Our approach todeveloping business, through formulation of comprehensive
proposals based on the integrated capabilities of our banking,trust banking, and securities functions, has become thestandard throughout our organization.
On the other hand, although the real estate sector of our trust
banking operations shows real potential, we are still in theprocess of consolidating our position to become the No.1
company in this field. We are also aware that we must further
enhance our capabilities to gain an advantage over other major
securities companies and compete effectively for major crossborder M&A and equity-related deals.
Based on this analysis of the operating environment and thestrengths of our in-house company, let us highlight what weare aiming to accomplish.

is to continue to grow together with our clients by creating
business value chains offering solutions to the wide range ofissues our clients face in terms of business and financial
strategy.
To do this, we must cultivate a talent pool that can provide
solutions to clients’ specific issues while taking a long-termview, responding agilely to changes in the social and businessenvironments, and, based on a real, in-depth understanding ofclient issues, commit themselves to increasing clients’corporate value.
Moreover, we will work to realize the full potential of our
in-house company system, and will reallocate corporate
resources, including human capital and other assets,
strategically and promptly, while continuing to adapt ourbusiness model.
Through these initiatives, we will support the sustainablegrowth of our clients, contribute to increasing corporate value,
and, in the face of major, rapid change in the operating
environment, we will work to increase our own earnings powerand strengthen our financial position with the objective ofcontinuing to be a valued partner for our clients.

Under our business model, which leverages our integratedbanking, trust banking, and securities functions, our objective

2. Value creation
Value for clients

Value for society• Provide optimal solutions and respond quickly to clients’• Contribute to Japanese and global economic growth bydiverse issues and needs• Continue to provide support for enhancing our clients’corporate value via the value chain business model• Provide risk capital based on our sophisticated risk-taking
capabilities

providing a stable and steady flow of funds to large
corporations, financial institutions, and public sector entities• Contribute to the revitalization of the Japanese economy by
fostering new industries, reorganizing existing industries, andrevitalizing regional economies• Contribute to the development of infrastructure via PPP/PFI2018 Integrated Report48

Our strategies for creating value

Corporate & Institutional Company
FY2017 results and FY2018 focus
Results
FY2017 marked the second year since the introduction of our
in-house company system. Although there were challenges toovercome, such as prolonged negative interest rates, thanks tocontinuing progress on our One Mizuho initiatives, Net
Business Profits and Net Income exceeded our targets. In fact,
we came close to the target levels for the final year of ourcurrent Medium-Term Business Plan about one year ahead ofschedule. In addition to an increase in loans outstanding, as aresult of the positive impact of asset rebalancing, we achieved
a positive reversal in interest income, as well as growth in
non-interest income, due in part to our efforts regarding
business value chains.
Also, by reallocating our resources, including assets andpersonnel, we were able to consistently demonstrate theadvantages of our in-house company system, achieving both
our ROE and staffing level targets for FY2017.
Reducing cross-shareholding is one of our key management
priorities. Although we did not meet our targets in this area
during the fiscal year, on an agreements basis, which includes
the amount of shareholdings we will be able to sell next fiscal
year, our ratio of progress toward the goal in our Medium-TermBusiness Plan is generally on target.
On the other hand, in the securities field, we have reported
steady progress improving sales frameworks by strengthening
global sector collaborations, developing talent, and developing
global business. However, we have yet to secure our target
share of major deals, indicating we must take further measures
to strengthen our securities business.

Future direction
Currently, due to accelerated implementation of global
strategies aimed at increasing corporate value, the earnings
power of Japanese companies has steadily improved, and thenumber of companies that are debt-free is increasing.
Moreover, clients are revising their business models in
preparation for coming structural changes in society andindustries, such as advances in digital innovation and progress
toward a carbon-free society.
In light of this environment, we will pursue the following four
strategies in FY2018 with the objective of fulfilling our missionof helping clients increase their corporate value andcontributing to the growth of the Japanese economy.
The first strategy is strengthening our securities business. In
equities, we are working to realign our organizationalframework to enhance collaboration between the front officeand product development sections. In terms of M&A, we areworking to strengthen the relationship between the front office
and advisory functions from the origination stage. Our second
strategy is to boost our support for Japanese companies thatare seeking to expand internationally. At Mizuho Bank, we
appointed executive officers to manage our relationship withselected global corporations last year and expect this tosubstantially strengthen our sales in this area. Our third
strategy is to tackle white spaces, which are untapped businessareas relevant to our core business, and to expand our scopeof risk-taking. By gaining a solid understanding of changes insociety and in industry structures, and proactively developing
new business in response, we will work to develop new
sources of earnings. The fourth strategy is to reformulate an
asset strategy for our in-house company. By drawing on ourcredit screening capabilities and strengthening our investment
management functions, we will enhance our risk-taking
capabilities and become better positioned to promote a
number of initiatives, address the increasingly diverse needs
and issues of our clients, and expand the scope of our risktaking.
By implementing these strategies, we will accelerate initiatives
to transform our business model and build a robust businessportfolio.

3. Business plan

Trends in risk appetite

Action plan

• Invest resources strategically and agilely in key sectors• Rebuild our business portfolio by selecting and focusing• Strengthen cross-border M&A business via global sector

on sectors in which we will take on risk

• Thoroughly enforce the compliance system underpinningour business model• Reinforce asset controls

49

Mizuho Financial Group

collaborations• Expand into white spaces• Cultivate new financial needs based on technologicalprogress• Optimize our sales and business processes

Our strategies for creating value Corporate & Institutional Company

2017 highlights
Trends in performance

(¥ billion) (Group aggregate, management accounting, rounded figures)

FY20161
Items
Performance

For reference:
FY2018 targets2

FY2017
Targets

Performance

Compared totargets

Year-on-year

Year-on-year

Gross Profits

434.1

—

433.0

—

-1.1

—

Net Business Profits

241.1

218.0

236.3

+18.3

-4.8

+15.0

Profits

218.1

231.0

272.3

+41.3

+54.2

+33.0

1. FY2016 results recalculated based on FY2017 management accounting 2. Comparison of FY2017 results recalculated based on FY2018 management accounting

Major KPIs
Proportion of non-interest income*Non-interest
incomeInterest
income56%

44%
FY2017FY2018 target
58%

FY2015
results

FY2016
results

FY2017
results

FY2018targets

1st

1st

1st

1st

2 worldwide (underwriting

3rd

4th

4th

2nd

3 (underwriting amount)

Domestic straight bonds

1st

1st

2nd

1st

M&A (deals related to

7th

1st

Top 5

Top 5

Bookrunner for domestic

1 syndicated loans

Total equity underwriting
amount)4 Japanese companies)* Management accounting, rounded figures

Solutions supporting sustainable growth for our clients and society
Contributing to the revitalization of regional areas in Japan and theJapanese economy as a whole
Drawing on our extensive expertise, we have provided many forms of support togovernment agencies, regional governments, and organizations, with the aim ofsolving social issues and revitalizing local areas in Japan. In FY2017, we aimed toprovide substantially more innovative support, including undertaking new advisory
positions in new infrastructure fields. Regional revitalization in Japan is also a policy
promoted on the national level through public and private sector collaboration. In thisarea we are continuing to provide high quality services for concession projects, suchas airports, water supply systems, and waste treatment systems, covering the fullprocess from the early consideration stages through to project syndication. In this way,
we are aiming to contribute to the further development of the Japanese economy.

Cultivating business value chains through the progressive development of
the One Mizuho strategy

Creating value chains through collaboration amongbanking, trust banking, and securities functions
Mizuho Bank

In response to increasing demand to take companies private, we have arranged
de-listings for major companies using private equity funds, with Mizuho Securities
acting as financial adviser and Mizuho Bank providing fund raising support. These
deals are very good examples of what we can do based both on our in-depth
discussions with clients over many years and our understanding of their businessstrategies. These deals succeed and are highly regarded because of our willingness totake on the risk associated with unprecedented deals and our ability to provide
seamless solutions through group-wide collaboration. Looking ahead, we will continue
to offer creative solutions tailored to the issues our clients face and, thereby contributeto increasing corporate value.

Mizuho Securities

Business strategy
discussion

IPO

Mizuho Securities
FA*

Delisting(taking companies private)
Mizuho Bank
Mizuho Trust &Banking
Corporate consulting

Mizuho Bank
Mizuho Securities

Bridge loans

Mizuho Bank
Permanent finance* FA: Financial advisor

2018 Integrated Report50

Our strategies for creating value

Global Corporate Company

Americas

EMEA

East Asia

Asia & Oceania

Aiming for sustainable
understanding of our clients’Our goals
In terms of the operating environment for the Global Corporate
Company, while the global economy is continuing to expand,
we remain concerned about the spread of protectionism,
political developments in Europe, and geopolitical risk in East
Asia, the Middle East, and elsewhere. Moreover, markets are in
the process of undergoing major changes along with interest
rate hikes and tax reform in the US, structural economic
reforms in China, and other developments.
Amid this operating environment, we at the Global Corporate
Company aim to become a highly trusted, long-term partner ofJapanese companies entering new markets overseas as well as
non-Japanese companies, based on our ability to provide
solutions that reflect a deep understanding of the businessesof our clients and our strength in corporate finance.
First, for Japanese corporations, we aim to provide seamlessservices in Japan and elsewhere to support their businessexpansion overseas by offering optimal financial solutions andreliable consulting advice ranging from providing information
for clients considering entry into overseas markets to supportin crafting business and financial strategies.

Seiji ImaiHead of Global Corporate Company

1. Current environment
Economic/social environment, client characteristics

protectionism, political turmoil in Europe, geopoliticalrisk, and other factors)• Further progress in globalization of Japanese companies• Asian economies representing a greater share of theworld economy• US interest rate hikes and tax reform• Structural economic reforms in China

Competitive & regulatory environment• Japanese megabanks accelerating development ofoverseas operations• Major European and US banks moving towarddifferentiation of their strategies by drawing on theirrespective strengths• Strengthening of liquidity and capital adequacy
requirements

51

Mizuho Financial Group

Opportunities

Our perception of opportunities and risks

External environment• Increasing uncertainty in the world economy (spread ofOffering solutions that integrate group strengths and draw
on our in-depth understanding of businesses andcapabilities in corporate finance• Expansion of global financial needs among Japanesecompanies• Acceleration of entry into Asia by European, US, andother non-Japanese companies• Stimulation of investments under US tax reforms• Growing sophistication of the financial needs of Chinese
corporations

Risks• Stagnation in financial markets due to increased uncertainty• Growing scarcity of market liquidity and capital due totightening of regulations• Rise in dollar funding costs due to increase in US interest rates

Our strategies for creating value Global Corporate Company

growth by offering solutions that draw on our in-depthbusinesses and our strengths in corporate finance
For non-Japanese companies, we are implementing our Global
300 Strategy which involves focusing on a group of about 300
blue-chip companies around the world. Under this strategy, we
adopt an industry/sector-based approach, focusing on sectors
where we have an in-depth understanding and a proven trackrecord, and develop close relationships with company
management. Through this strategic approach, we can build
long-term relationships with leading non-Japanese companies
and grow together with them in a mutually sustainable manner.
As liquidity and capital become scarcer, it is essential for us tobuild a powerful financial base to develop long-term
partnerships with these companies. To do this, our initiatives
include revising our business portfolio by reviewing
profitability and restructuring our assets. Specifically, we will
move forward with shifting assets to Global 300 and otherhigh-profitability segments, along with downsizing lowprofitability assets and reducing the portion of our portfolio
requiring high levels of liquidity.
In addition, we will offer a diverse range of financial services,
including not only credit transactions but also M&A services,bond underwriting, and other securities-related products aswell as transaction banking and other services. By enhancing
our ability to offer solutions based on our integrated banking,trust banking, and securities functions and by strengthening
our transaction banking services, including deposits,
settlements, and trade finance, we will work to meet ourclients’ broad business and financial strategy needs. By
strengthening our product and service offerings as a financial
services consulting group, we will be able to boost ourearnings power.
Moreover, to ensure a sustainable business and managementfoundation, we will continue to pursue operational excellenceand seek to enhance our non-yen currency funding capabilities.
To achieve operational excellence, we will optimize ourorganizational structure and business processes on a groupbasis. To strengthen our non-yen currency funding capabilities,
we will continue to take steps to increase non-yen currency
deposits and diversify our funding sources through theissuance of non-yen currency denominated bonds.

2. Value creation
Value for clients

Value for society• Provide diverse solutions such as M&A, DCM, and transaction• Contribute to global industry realignments and the economicbanking through collaboration among banking, trust banking,and securities entities• Provide support for Japanese companies entering new

development of emerging economies• Contribute to further development of financial markets andtalent development around the world

markets through collaboration with government agencies
around the world and with local financial institutions• Provide the latest information on global political and economic
trends through collection and analysis of information oninternational strategies

2018 Integrated Report52

Our strategies for creating value

Global Corporate Company
FY2017 results and FY2018 focus
Results
Focusing next on performance in FY2017, the businessenvironment continued to be challenging as economic growthin China slowed, the number of major M&A deals decreased,
and competition in Asia became more intense. Amid thisoperating environment, our in-house company’s Net BusinessProfits decreased—slightly below the target for the fiscal year;
however, we undertook a range of initiatives to improve ourservice offering capabilities and strengthen our earnings power.
For non-Japanese companies, we steadily expanded ourbusiness through continued implementation of our Global 300
strategy. We focused especially on taking an industry/sectorspecific approach and increasing the sophistication ofcollaboration between our banking and securities functions. As
a result, our accomplishments included becoming the only
Japanese bank to secure a position within the top 10 in theAmericas for three consecutive years. These and otheraccomplishments demonstrated an expanded market presence,
particularly in the United States. In addition, we strengthened
our capabilities for delivering solutions by upgrading ourorganizational framework for transaction banking andenhancing our product lineup. As a result, we are generating
steady profits in these fields.

To establish an even stronger foundation and provide in-depth
support to companies entering new markets and expanding
their businesses abroad, we are continuing to augment our
global office network. In FY2017, we established the Mizuho
Bank Phnom Penh Branch; Washington, DC Representative
Office; Dallas Representative Office; León Office in Mexico;
Mizuho Securities Asia Seoul Branch; and Mizuho International
DIFC Branch. In addition, we proactively concluded cooperative
arrangements with government agencies, financial institutions,and non-Japanese companies around the world.
We also took further initiatives in the pursuit of operational
excellence. These included optimizing our branch network andgiving consideration to personnel assignments with the aim of
maximizing group-wide productivity. In the United States, toenhance the efficiency of business operations and provide ahigher level of service nation-wide, we began preparations fortransferring IT system operations and branch support functions
from the Los Angeles Branch to the New York Branch in order
to concentrate these functions in a central location.

Future direction
In FY2018, we will continue to implement our Global 300
strategy and give consideration to expanding operations into
new risk domains as part of our drive to invest resources inhigh-margin segments. While enhancing our fundamental
earnings power, we will also further strengthen our capabilities
for providing services, including the full use of our analysis andproposal functions for each industry sector. This will enable us
to offer a wide range of solutions to meet diverse client needs
for securities products, transaction banking, and other services.
In addition, to tighten cost controls, we are working to optimize
our organizational structure and staffing levels as well as
increase operational efficiency through the use of RPA*, whilepursuing greater operational excellence—all with the objectiveof both improving services for clients and revising our businessstructure. Along with these initiatives we are also continuing to
implement measures to establish a stable funding base, mainly
for non-yen currencies.
As we steadily implement these strategies, we will also acceleratemeasures to expand our business, strengthen our earnings
power, and upgrade our business portfolio structure. By
continuing to offer services that are in line with client needs, inthe years to come we will realize sustainable growth working
in partnership with our clients.
*Robotic process automation: Software for automating business processes andoperations, automatically conducting tasks that would have previously been
done manually by a person using a computer.

3. Business plan

Trends in risk appetite

Action plan

• Focus on deepening relationships with blue-chip non-

• Shift resources from low-profitability to high-profitability

Japanese companies, especially the Global 300• Allocate capital and liquidity from low-profitability
segments to high-profitability segments with prospects
for business expansion• Expand volume of non-yen currency deposits and work
to increase quality

segments• Promote cross-selling between transaction banking andsecurities/market products• Promote operational excellence through integrated

operations on a group-wide basis, optimize businessprocesses, and other measures• Secure high-quality non-yen currency deposits anddiversify non-yen currency funding sources

53

Mizuho Financial GroupOur strategies for creating value Global Corporate Company

2017 highlights
Trends in performance

(¥ billion) (Group aggregate, management accounting, rounded figures)

FY20161
Items
Performance

For reference:
FY2018 targets2

FY2017
Targets

Performance

Compared totargets

Year-on-year

Year-on-year

Gross Profits

358.3

—

352.6

—

-5.7

—

Net Business Profits

115.0

125.0

100.2

-24.8

-14.8

+31.0

Profits

83.7

77.0

69.0

-8.0

-14.7

+10.0

1. FY2017 results recalculated based on FY2018 management accounting 2. Comparison of FY2017 results recalculated based on FY2018 management accounting

Major KPIs
Non-interest income outside Japan($ billion)
Increase of

1.4

30

1.4

Non-JPY deposits1($ billion)% from FY2015

Increase of

146.3

1.3

US bond underwriting (DCM) ranking*

10

172.7

($ million)% from FY2015

13th(2.9%)

161.6

94

FY2015
results

FY2016
results

FY2017
results

FY2018targets

FY2015
results

FY2016
results

FY2017
results

FY2018targets2

FY2014
results

1. Mizuho Bank and principal subsidiaries, including
central bank deposits. Global Corporate Company
management accounting basis.
2. Change from FY2015 estimates.

Ranking (share)

9th(3.5%)Net Business Profits

10th(3.6%)
9th(4.8%)
172

166

FY2016
results

FY2017
results

130

FY2015
results*Bonds worth $250 million or more, excluding
off-shore issuance
Source: Dealogic

Solutions supporting sustainable growth for our clients and society
Example of the Global 300 strategy in action
For one of our Global 300 clients, we provided support as lead arranger for the largest
MBO* financing to date in Southeast Asia. Subsequently, we substantially raised ourunderwriting share in a public offering for a J-REIT on behalf of the same client.
This financing is representative of the solutions provided through banking andsecurities collaboration under our Global 300 strategy. Going forward, we will
significantly raise our profile as a global player.
*Management buyout: The acquisition of a controlling share in a company by management and/or investment
funds.

Global300
clients

Offering integrated
group solutions
Loans

Underwriting
bonds forM&A deals

Transaction banking

Mizuho Bank issues onshore RMB-denominated bonds
In December 2017, Mizuho became the first Japanese bank to receive approval fromthe People’s Bank of China to issue Panda Bonds, which are onshore RMB-denominatedbonds issued in the Chinese interbank bond market. These bonds were issued in
January 2018. We will use the expertise gained from this issuance to provide greater
support than previously, including advisory services for clients interested in issuing
Panda Bonds and for medium- to long-term financing in renminbi.

2018 Integrated Report54

Our strategies for creating value

Global Markets Company

Investors

Aiming to become a top-classcapabilities tailored to each
Our goals
The Global Markets Company engages in sales and trading inorder to provide clients with market product-based solutions,and we also conduct banking operations, including asset
management and capital raising, securities investment, andother related activities.
In 2017, the global economy continued to expand, andaccording to the International Monetary Fund (IMF), favorable
economic conditions are likely to continue in 2018. On theother hand, political turmoil resulting from the emergence of
populism; geopolitical risk linked to the Middle East, North
Korea, and elsewhere; rising protectionism; and other factors
are continuing to create uncertainty. In addition, the rate oftechnological progress in AI and other fields has beenastonishing, and signs are appearing that society will likely
undergo major changes going forward.
Amidst the beginnings of major social change, clients’ needs interms of hedging and asset management are expected to
become increasingly diverse. However, this trend is expected
to bring major business opportunities for our sales and tradingbusiness. Additionally, our ability to provide sophisticatedbanking services differentiates our offerings from competitors.

Junichi Kato
Head of Global Markets Company

1. Current environment
Economic/social environment, client characteristics

External environment

policies in the United States and other major countries55• Growing diversity of investors’ asset management needs• Increase in cross-border transactions• Rapid advances in AI and other cutting-edge technology
Competitive & regulatory environment• Competitors moving in similar strategic directions• Transition to the implementation phase of various
financial regulations

Mizuho Financial Group

Opportunities

Our perception of opportunities and risks• Global political uncertainty remains high.
• Progress toward normalization of central bank monetary

Offering integrated group solutions leveraging our global
network• Strengthen our capabilities to respond to client needs
through early application of advanced technologies• Improve competitiveness through efficient portfolio
management, including strict adherence to early warning
controls and meticulous allocation• Differentiate services through careful responses to stricter,more-complex regulatory requirements

Risks• Possibility of a slowdown in the global economy andfinancial markets as a result of the acceleration of
normalization/tightening of monetary policy by the central
banks of major countries• Potential market turmoil accompanying increasing
geopolitical risk
• Possibility of declining competitiveness due to delays in
responding to technological progressOur strategies for creating value Global Markets Company

global markets player in Asia by strengthening our productclient segment
As we seize these opportunities, we are aiming to become a
top-class global markets player in Asia.
Looking ahead in our sales and trading business, in addition tocontinuing the collaboration among our banking, trust banking,and securities functions, our policy will be to work closely ininitiatives with other Mizuho in-house companies and units so
as to advance the implementation of our One Mizuho strategy.
Specifically, we will draw on our high-level professional
expertise in financial markets and market products and workwith other Mizuho in-house companies and units to provide
seamless banking, trust banking, and securities solutions. In
this way, we can offer the best market products in a timely
fashion and respond to clients’ specific requirements.
Moreover, we are committed to continuing our efforts tocontribute to market stability, and through participation inindustry associations, work toward contributing to the sounddevelopment of financial markets.

In our banking business, we will work to maintain stability in
our foreign currency liquidity management in order to support
our clients’ global operations. In addition, we will work tosecure stable earnings by maintaining our early warning
controls to capture nascent changes in the market
environment, and manage portfolios by efficiently making
quick decisions and precise allocations.
To continue to offer clients the highest quality of services, ourIT systems must meet global standards by incorporating
advanced technology and we must make ongoing upgrades toour operational infrastructure. We are proactively incorporating
both AI and other digital innovations by working to enhance
our digital platforms, applying AI to our early warning systems,
and utilizing Big Data. As a global markets player, we arecommitted to continually upgrading our infrastructure to
maintain and strengthen our competitiveness.

2. Value creation
Value for clients

Value for society• Offer optimal solutions that make use of market products to• Contribute to society and the economy through skillfully

meet a wide range of clients’ risk hedging and asset
management needs• Offer information on market trends based on our access to
information through our global network and our analyticalcapabilities

responding to client hedging and asset management needs• As global markets professionals, continuously provide
liquidity in offering a wide range of market products• Contribute to the development of sound financial markets bycomplying with regulations and participating in industry
associations• Contribute to the sustainable development of society throughcontinuing initiatives such as the issuance of green bonds2018 Integrated Report56

Our strategies for creating value

Global Markets Company
FY2017 results and FY2018 focus
Results
Net Business Profits for the Global Markets Company were¥38.2 billion below our target and amounted to ¥180.8 billion,
which was ¥165.3 billion below the level of fiscal 2016. A return
to normalcy in monetary policy is occurring, especially in the
United States, and the differential between long- and shortterm rates is expected to diminish. In addition, the Bank ofJapan’s efforts to control the yield curve have led to historically
low yen interest rates and Japanese government bond yields.
Against this backdrop, we expected banking operations toshow a marked decline in profitability compared to fiscal 2016,
but actual performance in fiscal 2017 was close to target levels.
On the other hand, sales and trading, where we had expected
an increase over the previous fiscal year, showed weak growth
in profits, and revenue fell below target levels as a low interest
rate and low volatility environment prevailed, mainly in theJapanese markets.

As these observations suggest, fiscal 2017 presented achallenging business environment, but in order to bring abouta V-shaped recovery in revenue in fiscal 2018, as interest rates
rose, mainly in the United States, we worked to maintain thesoundness of our banking portfolio and increased thecompetitiveness of our banking business by making our early
warning systems more sophisticated using AI and othermethods. In addition, to advance the integration of our banking
and securities operations, we moved ahead with the creationof a common derivatives platform globally to increase theprofitability of our sales and trading business. In fact, in our
Asia/emerging markets currency business, where we were
strengthening our efforts, our volume of transactions expanded
significantly and we achieved favorable results. As we
implement these initiatives, we are forecasting an increase in
Net Business Profits of ¥99.0 billion as part of our businessplan for fiscal 2018.

Future direction
Fiscal 2018 will be the final year of our current medium-termbusiness plan, and to ensure that we reach our revenue targets
for the fiscal year, it will be critical to implement our mediumto long-term initiatives in preparation for the next mediumterm business plan. In our sales and trading business, we mustmove ahead with integrated banking and securities activities
globally in the fields of foreign exchange, bonds andderivatives, and equity products. Especially in those market
businesses where there is room for further development, suchas investment funds, we want to strengthen our fundamental
earnings power by developing new relationships withJapanese and foreign investors and expanding our Asia andemerging markets currency business. In our banking business,by determining the optimal portfolio allocation for our in-housecompany as a whole and through increasing the sophisticationof our early warning systems, we will aim to secure stablerevenue streams in the midst of a fast-changing environment.
Among our medium- to long-term initiatives as preparation forour next medium-term business plan, we are working toallocate resources strategically with the aim of building nextgeneration trading rooms, markets IT systems, and back offices
with a focus on incorporating advances in technology so that
we can offer our clients high-quality services and solutions.

3. Business plan

Trends in risk appetite

Action plan

• In our sales and trading business, strengthen earnings• In our sales and trading business, promote the global• In our banking business, implement accurate portfolio• In our banking business, continue to raise thepower through seamless collaboration between ourbanking and securities functions

management by upgrading the sophistication of our early
warning system• Accelerate planning for the construction of new trading
rooms, markets IT systems, and back offices thatincorporate advances in technology

57

Mizuho Financial Group

deployment of integrated banking and securities forforeign exchange, bonds and derivatives, and equity
products

sophistication of our early warning system which will be
the basis for optimal portfolio management for the
in-house company as a whole• Allocate resources strategically with the aim of building

new trading rooms, markets IT systems, and back officesthat incorporate advances in technology

Our strategies for creating value Global Markets Company

2017 highlights
Trends in performance

(¥ billion) (Group aggregate, management accounting, rounded figures)

FY20161
Items
Performance
3

Gross Profits

Net Business Profits

3

Profits

For reference:
FY2018 targets2

FY2017
Targets

Performance

Compared totargets

Year-on-year

Year-on-year

539.9

—

381.7

—

-158.2

—

346.1

219.0

180.8

-38.2

-165.3

+99.0

224.2

147.0

120.2

-26.8

-104.0+69.0

1. FY2016 results recalculated based on FY2017 management accounting 2. Comparison of FY2017 results recalculated based on FY2018 management accounting 3. Including ETFs

Major KPIs
Sales & trading-related revenue*

Volume of Asian/emerging market currency transactions(in comparison with FY2015)(¥ billion)

300.0

345.0

307.8

352.8

9.1

(%)

5.9
(3.8)

FY2015
results

FY2016
results

FY2017
results

FY2018targets

FY2016
results

FY2017
results

FY2018targets*Global Markets Company management accounting basis

Solutions supporting sustainable growth for our clients and society
Our in-house company’s AI and digital innovation initiatives
We are working to improve services for our clients by applying the rapidly advancing
field of AI and other digital innovations. Specific examples include offering algorithmic
equity trading making use of AI, joint research on increasing the sophistication offoreign exchange trading undertaken with the research group of Associate Professor
Yutaka Matsuo of Tokyo University Graduate School, and the development of market
early warning tools with IBM Japan. In addition, Mizuho Securities held the Mizuho
Trading Conference for institutional investors, which focused on the topic of trading
using AI.

Mizuho Investment Conference
Mizuho Securities held the Mizuho Investment Conference (MIC) not only in Tokyo but
also in overseas locations, including New York and London. MIC has been wellreceived globally by many investors. In fiscal 2017, to inform global investors aboutpromising SMEs and attractive regional enterprises in Japan, we held the Japan
Opportunities 2017 MIC SME-Class Growth Stock Conference, which was the largest
conference of its type, aiming to encourage investment in Japanese enterprises.

2018 Integrated Report58Our strategies for creating value

Asset Management Company

Investors

Contribute to growth into long-term asset building
Our goals
Some aspects of the operating environment for the asset
management business are challenging, such as thecontinuation of negative interest rates and the entry of newcompetitors. However, from a medium- to long-term
perspective, I am confident that the direction of events ismoving in our favor. With the arrival of an era where many of
our customers will live to be 100 years old (a so-called “age of
longevity”), it will become even more important for individuals
to prepare for retirement by engaging in asset building to
supplement employer or government pensions. Moreover, as aresult of the work style reforms promoted by the Japanese
government, such as extension of the age for retirement, theneed for corporations to review their pension plans isincreasing.
Within our in-house company, Mizuho Bank, Mizuho Trust &Banking, Mizuho Securities, and Asset Management One work
together with the other in-house companies to meet the needsof a wide range of customers from institutional investors(pensions, financial institutions, corporations, etc.) to individual
investors. Also, we will continue to shift household assets tomore growth-focused portfolios by providing products andsolutions backed by our sophisticated investment capabilities.

Katsunobu Motohashi
Head of Asset Management Company

1. Current environment
Economic/social environment, customer characteristics
management as a result of NISA and iDeCo regulatory
reform• Deterioration in the asset management environment due
to negative interest rates• Increased adoption of passive investment and ETFs
• Technological innovation (AI, robo-advisors, etc.)• Increased emphasis on social contribution

Competitive & regulatory environment• Increased competition in Japan and overseas because of
the rise in Fintech companies newly entering the market• Greater emphasis on fiduciary duties

59

Mizuho Financial Group

Opportunities

Our perception of opportunities and risks

External environment• Increased convenience and greater need for asset

We are responding to expanding asset management needs by drawing
on our strong investment management, product development, andpension solutions capabilities backed by a top-class level of assets
under management in Japan and Asia as a whole• In this age of longevity, there is an expansion in the demographic
interested in asset-building spurred by the acceleration of the shift
from savings to investment• Growing need for review of the pension system in light of the trend
toward postponing the retirement age and greater diversity in work
arrangements• Rising interest, mainly among institutional investors, in ESG criteria

Risks• Decline in profitability because of increased competition forbusiness, trends toward passive investing and ETFs, and otherfactors• Outflow of investments from investment trusts paying monthly
distributions• Decline in institutional investor management needs caused bymarket uncertainty

Our strategies for creating value Asset Management Company

Japan’s financial assets by supporting customers’ mediumwhile fulfilling the highest level of fiduciary duties
Also, our aim is to increase productivity through medium- tolong-term initiatives, create a robust business base, andestablish our asset management business as a fourth pillar of
Mizuho’s earnings base along with banking, trust banking, andsecurities.

Also, by offering services as the manager and administrator for
defined contribution pension plans for individuals (iDeCo), we
work to provide our customers with access to a broader rangeof methods for building assets. Through these activities, ouraim is to increase assets under management.

The engine of our asset management business and its sourceof long-term growth are our investment capabilities. In today’s
financial markets, the demand for traditional active investing is
gradually diminishing, and the trend is toward strengthening
alternative investment and gatekeeping capabilities. Therefore,
we must work to make active use of leading-edge technologies
such as AI and Big Data to provide our clients with high added
value on a continual basis.

For institutional investors who manage pension funds, there isa growing need for consulting that takes into account theoverall amount of pension stipends in consideration of
employees’ after-retirement life as well as the implications ofJapan’s work style reforms. In addition to offering investment
strategies, we are accelerating our efforts to provide
comprehensive consulting and solutions such as building
pension portfolios, ALM analysis, and pension governancesupport.

For our individual customers, we make use of the advanced
investment expertise we have cultivated through our pension
business to provide investment trust and other products (suchas fund wraps) that are useful for medium- to long-term asset
building. In addition, with respect to investment trust sales
companies (e.g. banks and securities companies) in directcontact with customers, we make full use of one of Japan’slargest marketing systems. We are also proceeding to upgrade
our investment education website, while also working todeepen customers’ understanding of asset management.

Moreover, we want to substantially strengthen our initiatives todeal with social issues through our asset managementbusiness. We are incorporating non-financial information,
including environmental, social, and corporate governance(ESG) information, in our investment criteria. We are also
working to improve portfolio performance through assessmentof ESG integration, and the sustainability of the companies weinvest in, and promoting engagement to bring improvement incorporate value.

2. Value creation
Value for customers

Value for society• Individuals: In this age of longevity, we will respond to the• Support individuals to invest over the medium to long term as

ever-growing need for steady medium- to long-term asset

a means of supplementing corporate/government pensions,building as people prepare for retirement

thereby contributing to the shift of household assets to more

• Institutional investors: Respond to the need forcomprehensive pension consulting, portfolio diversificationand stable returns, and investment alternatives to Japanese
government bonds in the negative interest rate environment

growth-focused portfolios• Contribute to solving social issues through engagement withthe companies we invest in• Increase future national wealth and provide companies withgrowth capital, thereby contributing to a virtuous cycle for theJapanese economy

2018 Integrated Report60

Our strategies for creating value

Asset Management Company
FY2017 results and FY2018 focus
Results
In FY2017, funds continued to flow out of publicly traded investment
trusts paying monthly distributions. However, our balance of assets
under management rose ¥4 trillion over the previous fiscal year, to¥57 trillion, due to demand for asset-building investment products
and private placements of investment trusts with institutional
investors. As a result, we were able to achieve our in-housecompany’s Net Business Profit target.
In the field of investment trusts, we have built a strong reputation
as a result of our focus on providing support, including information,by convening roughly 8,000 seminars and informational sessions
each year. As a result of these and other activities, we were ranked
No. 1 in the Asset Management Brand Survey*, which is based onquestionnaires submitted by companies marketing investment
trusts and other investment products. From a product perspective,
we are strengthening our investment capabilities by incorporating
advanced methodologies. We newly established Japan’s firstpublicly traded fund making use of advanced “deep learning” AItechnology, the Global Stock Fund Managed with Artificial
Intelligence (AI). In addition, we introduced a new ETF-specificbrand, One ETF, and have listed three new ETFs.
In the field of pension funds, we are further expanding ourcomprehensive pension consulting services. We were the first to
launch a risk-sharing corporate pension in Japan, which are
attracting attention as the “third type of pension fund.” In addition,in 2017 we began marketing defined contribution pension plans forindividuals (iDeCo), which are now available to a wider customer
base. For iDeCo, we have expanded sales channels through a tie-up
with AEON Bank, and the number of participants/investors rose
30% over the previous year, to 79,000.
*Results from the 11th asset management company brand survey, “Nikkin Investment
Trust News”, The Japan Financial News Co. Ltd.

Future direction
In the field of investment trusts, currently the demand among
investors for investment trusts that pay monthly distributions isdiminishing, and, as a result, funds are also flowing out of AssetManagement One’s major funds. In FY2018, one of our mostimportant initiatives was to stem the tide of assets leaving monthly
distribution type funds and raise our assets under management
mainly through offering asset-building products. Initiatives haveincluded expanding the support we provide for investment productsales companies, including offering useful information for assetbuilding to individual customers through seminars and othermeans, and working to increase convenience for customers. In
terms of investment products, we have newly introduced low risk
investment trusts aimed at first-time investors. We are also working
to expand our base of investors and are focusing on products thatwill give additional impetus to the shift from savings to investment.
As for pensions and other related fields, Mizuho Trust & Banking
has launched comprehensive pension plan consulting services witha view to the full range of corporate retirement benefits. Mizuho
Trust & Banking, Mizuho Bank, and other group companies areworking together to accelerate this marketing approach. To discoveradditional customer needs at the branch level, we are introducing
customers to ways to combine long-term asset-building productsthat take advantage of preferential tax treatment such as
Installment-type Nippon Individual Saving Account (NISA) andiDeCo.
We are also aiming to substantially enhance our investment
capabilities in response to increasingly diverse customer needs,
including strengthening our in-house alternative investment
capabilities and our gatekeeping functions.
Similarly, at Asset Management One, we plan to complete thepost-merger integration of business processes and IT systems toachieve integrated organization management within the current
fiscal year, and thereby establish the foundations for increasing
productivity.
Through these various activities, we are working to steadily tostrengthen our earnings power, and, at the same time, make astrong start in FY2018, the first year for implementing ourfundamental structural reforms.

3. Business plan

Trends in risk appetite

Action plan

• View asset management business as a growth area

• Strengthen our investment capabilities, which are thecontributing to the expansion of Mizuho’s non-interest
income and to balance sheet control, and therefore
allocate business resources to investment, investment
trusts, and pensions

engine driving our asset management business and thesource of long-term growth• Taking into account the shift from savings to investment/
asset building, allocate more business resources toinvestment trusts• Accelerate the offering of comprehensive pension
consulting/solutions• Strengthen initiatives to solve social issues throughstronger focus on ESG investing61

Mizuho Financial GroupOur strategies for creating value Asset Management Company

2017 highlights
Trends in performance

(¥ billion) (Group aggregate, management accounting, rounded figures)

FY20161
Items
Performance

For reference: FY2018
targets2

FY2017
Targets

Performance

Compared totargets

Year-on-year

Year-on-year

Gross Profits

48.9

—

50.2

—

+1.3

—

Net Business Profits

20.0

24.0

25.7

+1.7

+5.7

+1.0

Profits

9.6

11.0

13.5

+2.5

+3.9

-0.0

1. FY2016 results recalculated based on FY2017 management accounting 2. Comparison of FY2017 results recalculated based on FY2018 management accounting

Major KPIs
Assets under Management(¥ trillion)

Pensions

Investment trusts

52

53

57

13

14

15

39

39

42

FY2015year-end

FY2016
year-end

FY2017
year-end

Defined contribution pension plan (corporate-type & individual-type)participants(thousand)995

May 2014

1,122

1,064

May 2015

May 2016

1,175

May 2017

Solutions supporting sustainable growth for our customers and society*Pension plan established in January 2017 following legal and other reforms

Corporatefinances
HR systems

As the operating environment for corporate pensions undergoeschange, Mizuho Trust & Banking has developed and launched arisk-sharing corporate pension*, which is referred to as the “third typeof pension plan” and is the first plan in Japan that features risksharing. This new pension plan aims for fairer sharing of risk between
employees and corporations. Employees bear the burden when theinvestment performance of pension assets weakens and pension
payments are reduced, but on the other hand, corporations bear moreof the premium (contribution) compared with the current defined
benefit pension plans. This new pension plan has drawn attention as asolution for structuring a sustainable and stable pension system.
Mizuho continues to be a leader in fulfilling fiduciary duties, and weare enhancing our consulting capabilities to better meet ourcustomers’ needs and always be their number one choice.

Comparison of risk-sharing corporate pension plans and defined
benefit/contribution plans

Assetmanagement

Responding to new regulations affecting pension plans:Mizuho entrusted with Japan’s first risk-sharing corporate pension

Defined benefit
pension plan

Risk-sharing corporate pension plan

Defined contribution pension plan

Premium

Variable

Fixed

Fixed

Entered under liabilities

Necessary

Unnecessary

Unnecessary

In case ofearly retirement

Receivable uponretirement

Receivable uponretirement

Not receivable until
60 years of age

Reduction
if leaving
company
for personalreasons

Possible

Possible

Not possible

Investedprincipal

Company (or fund)Company (or fund)Employees

Investment trust using cutting-edge AI (deep learning) launched
At Asset Management One, we used deep learning, a cutting-edge AI technology, to select stocks for a newinvestment trust, which in September 2017 was the first of its kind to be issued publicly in Japan. In preparing
this investment vehicle, the AI system used about 20 years of stock price and financial data to rank the level of
attractiveness of various stocks, and then made determinations and selected candidate stocks for theinvestment trust. Next, fund managers used their judgment, combined with an analyses of fundamentals andother criteria, to make the final selection of the stocks with upside potential. We will continue to use digital
innovation to strengthen our asset management performance and offer support to our customers in theirasset-building activities.

2018 Integrated Report62

Our strategies for creating value

Global Products Unit

Transaction banking

Investment banking

We aim to improve our ability
consulting unit” delivering a
Our goals
As uncertainty grows in the global economy, price fluctuation
risk for stocks, bonds, real estate, commodities, and otherassets is continuing to rise. Client needs are becoming
increasingly sophisticated and diverse as corporations expand
globally. The operating environment is moving at an ever-fasterpace in parallel with technological progress, as typified byFintech. Amid these conditions, we at the Global Products Unit
are aiming to demonstrate our specialized capabilities byascertaining changing trends in the environment surrounding
our clients and offering a broad range of solutions.
Our activities are primarily divided into two areas: investmentbanking and transaction banking. Our role is to act as aplatform for financial products that support the Mizuho group’s
activities.
The unit’s strengths are our strong collaboration with groupcompanies such as our banking, trust banking, and securities
entities, and our financial product expertise. By substantially
increasing the sophistication of our operating framework on a
global basis, we are demonstrating these strengths. To be sure,drawing on these strengths to the fullest extent possible toenhance our risk-taking capabilities is an issue that we must
address going forward.

Goji Fujishiro
Head of Global Products Unit

1. Current environment
Economic/social environment, client characteristics

business activities• Increase in the influence of external shareholders on
corporate management• The management of SMEs and middle market companies
are aging, and there is a shortage of successors• Expansion in investments in real estate and other such
assets in today’s negative interest rate environment• Continuing high price volatility of stocks, bonds,
real estate, commodities, etc.
• Increase in social welfare costs as the population ages inJapan and resulting pressure on fiscal resources• Innovation and technological progress, as typified by Fintech

Competitive & regulatory environment• Commoditization of many financial products• Increasing number of companies from other industries
entering the financial sector

63

Mizuho Financial Group

Opportunities

Our perception of opportunities and risks

External environment• Rising number of companies aiming to globalize their

Demonstrating strong collaboration among group companies
and a high level of knowledge and expertise regarding products• Increasing need for Japanese companies to enter
overseas markets and review their business portfolios• Growing need for business and asset succession• Expansion in demand for real estate investments among
global investors, including Japanese investors• Rising need for support related to infrastructure
investment and concessions• Rising potential for offering new solutions throughinter-industry collaboration

Risks• Deterioration in the operating environment accompanying
the decline in interest income• Intensifying competitive environment accompanying the entry
of companies from other industries into the financial sector• New and stricter laws and regulations

Our strategies for creating value Global Products Unit

to respond to client needs and to become a “products
high level of expertise on a global basis
By drawing on our strengths, which include strong groupcollaboration and sophisticated professional capabilities, we
are working to enhance our risk-taking capabilities while taking
the perspectives of investors into account. Our aim is tobecome a “products consulting unit” providing sophisticatedexpertise and delivering optimal solutions to meet our clients’needs.
As for our specific initiatives, we are responding seamlessly to
our clients’ needs and supporting their corporate growth byoffering a wide range of products and solutions that areappropriate for each specific company’s development stage
and requirements. In this, we will fully draw on the banking,trust banking, and securities functions of the group—not only
in our advisory and financing business in the M&A sector andwhen serving as an intermediary in the real estate sector, butalso in foreign exchange transactions and when we serve as
the IPO bookrunner or transfer agent when a company
becomes listed on a stock exchange.

As for our newest initiatives, we believe that to meet theincreasingly diverse needs of our clients, we must not hesitate
to go well beyond existing product domains and to create
dynamic new solutions. By utilizing our unit’s knowledge andexpertise, we are taking the initiative to develop solutions that
better match client needs. In addition, by using RPA* and othertechnologies to increase internal business process efficiency,
we can focus on enhancing our ability to offer services anddevelop our capabilities to better respond to client needs.
In implementing these initiatives, we intend to become a“products consulting unit” and to contribute to greater
convenience for our clients and to social progress.
*Robotic Process Automation: A type of software that makes it possible to input,
process, collect, and check data accompanied by simple decision making.

In addition, we will contribute to the growth of industries andmeet societal needs by providing support on a global basis ineach sector, supporting companies’ globalization efforts andworking to make renewable energy more widespread bybacking the solar and wind power industries.

2. Value creation
Value for clients

Value for society• Value chains that combine multiple solutions through• Contribute to companies’ globalization via support in sectors

collaboration among group companies• Optimal solutions for clients’ needs, such as M&A and IPOs
• Support for clients’ global expansion via collaboration among
our offices in Japan and overseas in a wide range of productareassuch as M&A and transaction banking• Contribute to the growth of various industries by providing

solutions that respond to such policy trends as infrastructure
exports and concession projects• Provide solutions that respond to transformations in the social
structure by developing new products based on technologicalinnovation• Assist the spread of renewable energy through means such assupporting the solar and wind power industries

2018 Integrated Report64Our strategies for creating value

Global Products Unit
FY2017 results and FY2018 focus
Results
In fiscal 2017, we reported generally favorable results in bothinvestment banking and transaction banking, and were therefore
able to contribute to the performance of each of Mizuho’s in-housecompanies.
For example, in the syndicated loan sector, for the ninth
consecutive year we placed No.1 as the market leader forsyndicated loans in Japan, based on our ability to respondpromptly to a range of client needs.
In addition, in the real estate field, we identified the needs of themarket and investors, and together with Mizuho Bank, Mizuho Trust& Banking, Mizuho Securities, Mizuho Real Estate Sales, Mizuho
Realty One, and other members of the group, we compiled an
extensive track record, including the conclusion of major projects,
and reported favorable results for the fiscal year.
As for transaction banking, we worked to make client services
more convenient, including upgrading features that allow clients toopen accounts online rather than having to visit one of ourbranches. By offering carefully tailored services in various areas,
including custody, cash management, and trade finance, we
received No. 1 rankings from external assessment organizations.
In addition to these activities, we undertook new initiatives bydrawing on our strengths, which include close and strong
collaboration with our group companies in banking, trust andbanking, securities, and other businesses as well as our productknowledge and expertise.
For example, one of the ways in which we demonstrated our unit’s
product knowledge was by investing in Japan’s first Social Impact
Bonds* business. We also provided funds for environmentallyfriendly projects that involved Mizuho issuing its first Green Bonds,
offered investment opportunities for ESG investors, and other new
initiatives that made available additional opportunities for solving
the problems facing society.
*Social Impact Bonds: A results-linked framework that enables the public sector to
make use of private funds

Future direction
In fiscal 2018, our objective will be to continue to provide a wide
variety of effective products and solutions that are appropriate forthe stage of development of our clients and the issues they
confront. To do this, we will substantially increase collaboration
with Mizuho group companies in the banking, trust and banking,and securities businesses and draw even more than before on the
products and high-level specialized expertise of our unit. We willprioritize initiatives to help meet rising needs for services related tobusiness and asset succession, solutions for the tight fiscal
positions of local governments owing to rising welfare costs, andother social problems as well as issues faced by our clients intoday’s environment.
In terms of business succession and M&A needs arising fromclients’ business strategy considerations, we will offer support forclients’ business succession to non-family interests using theMizuho Business Succession Fund and other optimal solutions tomeet needs related to restructuring and realigning businessportfolios.

In today’s environment where the fiscal positions of local
governments are tightening and the demand for making more
efficient use of real estate assets is rising, we will offer an organic
combination of multiple solutions available from group companies
and provide support for the transition to new concession*arrangements that make use of private-sector funds.
For regional financial institutions in Japan that are confronted withdeterioration in their interest income, we will work closely withthem and collaborate in offering financial products to retailcustomers as well as work to contribute to regional areas.
Through these various initiatives, we will support Mizuho as afinancial services consulting group from the financial productperspective and thereby contribute to solving a wide range ofissues faced by our clients and society as a whole.
*Arrangements where ownership of public facilities remains with the public sector,
but operation of the facility is subcontracted to the private sector

3. Business plan

Trends in risk appetite

Action plan

• Offer product functions for each of Mizuho’s in-house• Respond to a wide range of client needs by seamlesslycompanies and entities with the aim of expanding our
non-interest income business• Maintain asset rotation readiness with a focus on ultralong-term assets and non-yen currency assets based on
regulatory and market trends• Take up the challenge of new business areas bydeveloping products that are based on technologicalinnovation and transcend existing domains

65

Mizuho Financial Group

offering diverse products that integrate our groupcompanies’ banking, trust banking, and securities
functions• Strategically reduce risk assets to generate new asset
investment reserves and achieve a high ROE• Leverage our product expertise and market sensitivity toopen up new domains of business• Further boost productivity, via applications of technology
and organizational reformOur strategies for creating value Global Products Unit2017 highlights
Principal accomplishments in investment banking

Principal accomplishments in transaction banking

FY2017 results

FY2017 results

Syndicated loans (Japan)

No. 11

CustodyNo. 14ABS lead underwriterNo. 12CMS

No. 15

Project finance (Japan)

No. 13

Trade Finance

No. 16

1. Amount basis, bookrunner basis
2. Amount basis, asset-backed securities
3. Amount basis, bookrunner basis

4. Mizuho won first place in custody bank survey rankings (in the Japanese market) in
Global Custodian magazine.
5. Mizuho won first place in the Cash Management Service (CMS) ranking survey ofEuromoney magazine (in the Japanese market).
6. Global Trade Review awarded Mizuho the “Best trade finance bank in East Asia & thePacific” award.

Solutions supporting sustainable growth for our clients and society
Received award for best trade finance bank in East Asia and thePacific
Mizuho Bank won the award for best trade finance bank in East Asia and thePacific among Global Trade Review’s (GTR) choice of Leaders in Trade.
GTR is one of the major magazines in the industry which is read by financial
institutions, regulators, traders, and manufacturers in over 90 countries. We
were selected for this award because of GTR’s high evaluation of ourstrengths in trade finance, such as a broad network and quality of services,
including supply chain finance, and our track record in customized productofferings for leading companies around the world.
We will continue pursuing excellence with the goal of being our clients’
most trusted financial services consulting group.

Healthcare bond issue, with Mizuho Securities as sole lead underwriter,
wins Deal of the Year Award
In 2017, Mizuho Securities acted as sole lead underwriter for the healthcare
bonds of Groupe BPCE and received the Deal of the Year Award from mtn-i*.
BPCE is a leading financial group based in France, and the proceeds of thebond issue were made available for BPCE’s clients in the healthcare
industry, mainly in the form of loans. Just before this bond issue, Mizuho
Securities acted as joint bookrunner for BPCE’s inaugural social bonds too,
which were also the first Samurai social bonds in the finance industry.
These initiatives were timely and coincided with the rising interest in anddemand for ESG bond investments among Japanese investors. Mizuho willcontinue to contribute to the sustainable development of society throughour financing activities.
*mtn-i, Ltd. is an information platform based in the UK that issues market analyses and market
information.

2018 Integrated Report66

Our strategies for creating value

Research & Consulting Unit

With Mizuho’s One Think Tank
proactively to develop solutions
Our goals
Although the global economy is moderately expanding, in thecurrent environment we must note rising uncertainties,
including geopolitical risk. In addition, since climate change,
growing wealth inequality, and other issues are becoming
more serious, there is increasing interest in the UN’s
Sustainable Development Goals (SDGs*) and other social
issues. Given this operating environment, requirements forhigh-quality research and consulting among our clients andsociety at large are growing stronger and stronger.
Mizuho’s Research & Consulting Unit brings together the
research and consulting capabilities of the Mizuho group inwhat we refer to as One Think Tank, which works to address theissues confronted by clients in terms of corporate
management, finances, and strategy as well as in business/
asset succession, and IT systems. One Think Tank also seeks tooffer effective solutions in areas such as the naturalenvironment, energy, infrastructure, and healthcare.

Motonori Wakabayashi
Head of Research & Consulting Unit

Economic/social environment, client characteristics• Increasing uncertainty in the global economy• Rising interest in addressing social issues, including
External environment

climate change and wealth inequality• Increasing business succession related needs at SMEs in
Japan• Exponential progress in digital innovation• Growing number of initiatives through public and private
sector collaboration

Competitive & regulatory environment• Competitors moving in similar strategic directions• Unbundling of research fees under the EU’s MiFID II
regulations regarding securities research

67

Mizuho Financial GroupOur perception of opportunities and risks

1. Current environment
Opportunities

Deploy the group’s research and consulting functions to provide
seamless services to clients• Growing need for top-quality research and information on
the macro-economy and industrial trends• Widening requests for consulting related to ESG andother non-financial indicators to contribute to solvingsocial issues• Increasing need for consulting related to businesssuccession and asset succession• Expanding need to develop new business utilizing AI, Big
Data, etc.
• Growing need for advisory services related to the
expanding range of PPP and PFI projects

Risks• Intensified competition leading competitors to adopt
similar strategies• Changes in business structures along with reviews andrevisions of regulations

Our strategies for creating value Research & Consulting Unit

as a key source of our value creation process, we work
regarding the issues facing our clients and society as a wholeOver the two years since our unit was formed in April 2016, wehave endeavored to build strong foundations for One Think
Tank that can function as a resource for our clients andMizuho’s in-house companies alike. Accordingly, we have built
a framework to share One Think Tank’s functions seamlessly
throughout the group with the aim of developing
comprehensive solutions.
Our objective is to become our clients’ best partner, providing
solutions to support the sustainable growth of our clients andsociety. This is the objective of Mizuho as a whole, and One
Think Tank is positioned as the fifth pillar of our businessstrategy for realizing this objective. Looking ahead, we will
work even more proactively to contribute to the developmentof our clients and society as a source of value creation.
The numerous specialists in our unit give us an edge in termsof being a source of value creation. We have further sharpened
our industry and solutions expertise, which has given us acompetitive advantage. We are also broadening opportunities

for creating new value by developing our IT and digital edge in
new growth fields.
By positioning One Think Tank as a source of value creation, we
will contribute more to strengthening Mizuho’s earnings power.
To do this, an essential element will be collaboration with
Mizuho’s in-house companies. By sharing our knowledge andexpertise with the frontlines of our business, we can further
enhance collaboration with each in-house company.
As a unit of specialists, we are working to cultivate many new
business domains, and by substantially strengthening ourcollaboration within Mizuho, we are working to contribute to
the development of our clients and society as a whole, thereby
fulfilling One Think Tank’s role as a source of value creation.
*The international goals stated in the “2030 Agenda for Sustainable
Development” that were adopted at the United Nations Summit held in
September 2015 are for achievement between 2016 and 2040

2. Value creation
Value for clients

Value for society• Offer upstream and downstream comprehensive solutions• Against the backdrop of Japan’s declining birthrate andencompassing macroeconomic, industrial, and digitaltechnology factors to help clients implement their growthstrategies• Strategically reorganize Mizuho’s corporate membershiporganization, which is the largest among Japanese banks, andprovide extensive expertise to a wide range of clients
including SMEs and middle market corporations, as well as
business owners

demographic aging of the population, contribute to regional
revitalization and nurture next-generation industries byoffering policy proposals and consulting based on a
combination of One Think Tank’s specialized areas of expertise• Contribute to the improvement of social infrastructure andenvironmental issues in Japan and around the world through
PPP/PFI advisory services, drawing on our public policy
expertise• Offer useful information related to solving social issues basedon reports and forums held with the objective of sharing our
high-level expertise regarding a range of areas from economic/
social trends to structural changes in industries and individual
fields such as the environment, social security, and IT

2018 Integrated Report68Our strategies for creating value

Research & Consulting Unit
FY2017 results and FY2018 focus
Results
Fiscal 2017 was the second year since the formation of the Research& Consulting Unit. By consolidating the group’s research andconsulting functions within this unit, we are developing solutionsof greater depth and breadth, and through collaboration with
Mizuho’s in-house companies, we are helping to expand Mizuho’sbusiness.
For example, the One Think Tank Forum and One Think Tank Reportpresent our ultra-long-term vision of Japan’s future through 2050
and demonstrate One Think Tank’s considerable expertise andinsights. These activities have significantly boosted Mizuho’s brandimage and have provided assistance to clients in formulating theirmedium- to long-term strategies.
These activities have markedly increased collaboration within-house companies. We are providing our large corporate clients
not only with strategic planning and hypothetical scenario
proposals for the Japanese market, but are also increasingly
presenting proposals that are global in scope. As client needs

among SMEs and middle market companies become more diverseand complex, we have substantially increased the number ofconsulting professionals providing advice on growth strategies andbusiness succession. We have also upgraded our talentdevelopment practices and taken other measures to expand our
response capabilities. Such steps have clearly enhanced our ability
to respond to a broader range of needs.
Among other results, we have cultivated leading-edge advances in
IT and digital fields, including verification tests making use of
personal information conducted through collaboration among
government organizations and private entities, which is known as
the Information Bank Project. We have also worked to develop AI
image analysis technology and RPA* adoption support as well as
support for business matching through our ability to assess thepotential applications of new technologies.
*RPA stands for robotic process automation. For example, software that “learns” andautomates business processes, completing tasks that previously were done manuallyby computer users.

Future direction
As uncertainty in the economy and society grows, and the businessand social issues confronting our clients become more diverse,
there is increasing need for the unique capabilities that One Think
Tank can offer.
In fiscal 2018, we are working to further develop our businessbased on One Think Tank’s specialized professional capabilities. For
example, we are establishing stronger links with Mizuho’s
investment banking business by developing proposals for thefurther expansion of clients’ global business activities. In addition,using our business succession consulting as a base, we are also
working to expand our real estate intermediary, finance, and assets
in custody businesses. Through these activities, we are endeavoring
to provide one-stop support for our clients, ranging from strategy
formulation to implementation, and implementing initiatives toincrease our fundamental earnings power.
In April 2018, we merged Mizuho’s various membership services
and membership organizations for corporations to create a single
service, Mizuho Membership One (“MMOne”). MMOne provides
expanded content as well as improved convenience andfunctionality for clients using our membership services. The
objective is not only to offer clients high-value-added informationand expertise, but also to provide relationship managers at ourbranches with this information to help them enhance the proposals
they make to clients, both remotely and face-to-face. In this sense,
we are working toward building a community that generates
information and business opportunities, truly enabling Mizuho andits clients to continue to grow and succeed together.
Moreover, we are working to accelerate our efforts to find solutions
for social issues. These activities include providing advisory
services for the growing PPP/PFI market (projects involving public
and private sector collaboration), developing products and services
based on the RPA software introduced by Mizuho, and addressing
new and challenging domains in the ESG* area.
Through these various initiatives, One Think Tank is becoming evenmore proactive, and is taking on the challenge of helping to addressclient and social issues as well as evolving toward our goal of beinga strong source of value creation.
*ESG stands for environment, social, and corporate governance. In recent years, thesethree aspects of corporate activities have come to be recognized as having an impact
on corporate sustainability.

3. Business plan

Trends in risk appetite

Action plan

• Provide optimal solutions based on the risk appetite• Structure Mizuho’s value chain with One Think Tank as thepolicies of our in-house companies and addressincreasingly diverse and sophisticated client needs• As a result of the consolidation of Mizuho’s research andconsulting functions within the unit, use the One Think
Tank competitive edge to attain greater depth andbreadth to our capabilities, and collaborate with thein-house companies to a higher degree in order tobecome a source of value creation and contribute to thedevelopment of our clients, society, and Mizuho as a
whole

69

Mizuho Financial Group

foundation• Strategically strengthen the functions within the unit andoperate as a unified organization in order to meet
expanding client needs effectively and efficiently• Pursue additional development of MMOne as acommunity that generates information and business
opportunities with the goal of having Mizuho growtogether with our clients

Our strategies for creating value Research & Consulting Unit2017 highlights
Solutions supporting sustainable growth for our clients and society
Established and expanded Mizuho Membership One (MMOne)
In April 2018, we integrated the group’s corporate membership systems andservices, including the corporate membership service of Mizuho ResearchInstitute, Forum-M, which was the largest of its kind among Japanese banks,and established Mizuho Membership One (MMOne).

MMOne framework
MMOne members

Use of digitaltechnology

MizuhoMMOne

Providing information

MMOne will offer one-stop, online and offline access to the wide range of
information services that Mizuho can offer, which will be useful to clients when
formulating their business strategies.

Browse andconsult

Moreover, going forward, we plan to introduce digital technology to further
develop the services of MMOne as a core element of our self-service offerings.
As a result of the value MMOne can offer, One Think Tank, and Mizuho as awhole, will better be able to contribute solutions for a wider range of clients.

Seminars
Business advisory

Web

Reports
Video streaming etc.

Collaboration
Consulting

Branches and offices

One Think Tank Forum held as part of the Tokyo 2020 Nationwide Participation Program
Mizuho is one of the Tokyo 2020 Olympic Gold Banking Partners, and together with Nihon Keizai
Shimbun, which is a Tokyo 2020 Olympic Official Partner in the newspapers category, we held the Mizuho
One Think Tank & Nikkei 2020 Forum for the second consecutive year. This year’s theme was “A Giant
Leap Forward from 2020: An Ultra Long-term Vision of Japan’s Future.” Presentations at the forum
offered insights into Japan’s economic growth going forward 10 years, 20 years, and 30 years from 2020,
the year of the upcoming Olympic and Paralympic Games Tokyo 2020. A key topic was what will be the“innovation” that will be needed to ensure a bright economic future for Japan. Representatives fromOne Think Tank gave presentations, along with other knowledgeable experts, and participated actively inthe discussions while giving their own sharply honed views regarding “Japan’s Ultra Long-term Vision.”Contributing to clients’ adoption of Japan’s workstyle reforms by providing support for RPA* implementation
Mizuho Information & Research Institute (MHIR) launched nationwide support services forfinancial institutions, corporations, government agencies, and local government organizations
looking to implement RPA.
In order to adopt the workstyle reforms promoted by the Japanese government and adapt tothe decline in the working population and other developments in the business environment,
greater attention is being given to RPA, which makes it possible to automate certain processes
that were formerly completed manually. Based on MHIR’s experience and expertise gained
through introducing RPA within Mizuho, we provide a comprehensive range of support, frommaking plans to introduce RPA, offering various kinds of templates needed for the system, andoffering advice on the choice of products, to the development of RPA systems as well as theiroperation and maintenance. Through these activities, MHIR contributes to clients’ efforts toincrease operational efficiency and raise productivity by providing both IT solutions andconsulting.
*RPA: Robotic process automation

Supporting the Osaka Municipal Subway to become incorporated
Mizuho Research Institute (MHRI) became the first company in Japan tosign a contract for assisting with the incorporation of a subway operatingcompany. MHRI obtained this mandate by emphasizing our collective
group capabilities, which include strict process management and theability to provide a full range of related services.
In Japan, maintaining the stable operation of the urban transport
infrastructure has become an issue because of the decline in the birthrate
and the aging of the population, which may lead to a decline in subway
users in the years ahead.
MHRI pioneered the implementation of PFI projects in Japan, and to datehas made arrangements for more than 400 such projects. In recent years,
MHIR has strengthened its capabilities in this area and has performed therole of acting as a bridge between public and private sectors to promoteeconomically viable PPP/PFI* projects and expand the market for PPP
arrangements, mainly in infrastructure development.
*PPP: Public private partnership; PFI: Private finance initiative2018 Integrated Report70Foundations for our corporate value

Corporate governance
Mizuho Financial Group, as the group’s holding company, is pursuing a vision regarding the shape and role of our Board of Directors andcorporate governance. To fulfill our social role and mission by creating value for shareholders and other stakeholders, realizing improved
corporate value through continuous and stable corporate growth, and contributing to economic and industrial development and theprosperity of society inside and outside of Japan, we have established our corporate governance system with the Board of Directors at its
core, and are working to further enhance our corporate governance.

Basic policy regarding Mizuho Financial Group’s corporate governance system
Effectiveness

Ensuring the separation of supervision and management
Secure the effectiveness of corporate governance by ensuring the separation of supervision and management and making supervision of the
management, such as the execution of duties by executive officers, the primary focus of the Board of Directors

Speed

Delegating decisions on business execution to the executive officers
Make it possible for the management to make swift and flexible decisions and realize expeditious corporate management by enabling the Board of
Directors to delegate decisions regarding business execution to the executive officers

Transparency andfairness

Securing independence of management supervision
Utilize committees and other forms of oversight, comprised mainly of outside directors who are not members of the management of Mizuho, andsecure transparency and fairness in decision-making processes regarding the appointment and dismissal of, and compensation for, the management
as well as ensure effective supervision of the management

Global perspective

Adopting global standards
Establish a governance structure appropriate for a global financial group by actively adopting operations and best practices that are recommended at a
global level

Principal features of Mizuho Financial Group’s corporate governance system
Composition of theBoard of Directors

The majority of the Board of Directors shall be comprised of non-executive directors.
In light of the role of the Board of Directors to supervise the management, the number of non-executive directors (outside directors and internal nonexecutive directors) shall comprise a majority of the directors in the Board of Directors. Meanwhile, we appoint a sufficient number of internal directors
for the purpose of ensuring quality, including expertise, in decision making and effective supervision by directors who are familiar with financial
businesses and regulations as well as Mizuho’s business model.
The Chairman of the Board of Directors shall, in principle, be an outside director.
The Chairman of the Board of Directors shall, in principle, be an outside director (or at least a non-executive director) in light of the role of the Board of

Chairman of the Board
Directors to supervise the management.
of Directors

The Deputy Chairman of the Board of Directors shall be selected from among the internal non-executive directors and shall assist the Chairman in theperformance of his or her duties.

Composition of
the Nominating
Committee andCompensation
Committee

The members of the Nominating Committee and the Compensation Committee shall all be outside directors.
The members of the Nominating Committee and the Compensation Committee, including the Chairman, shall be appointed from among the outside
directors (or at least non-executive directors) to ensure objectivity and transparency in the process of appointment of, and compensation for, directors.

Chairmen of theNominating,Compensation, andAudit Committees

The Chairmen of the Nominating, Compensation, and Audit Committees shall be outside directors.

Progress on strengthening
corporate governanceFirst as a Japanese bank

First as a Japanese megabank	Filed our Corporate Governance Report in compliance with the Corporate Governance Code	Disclosed our Policy Regarding Cross-holdings of Shares of Other Listed Companies and our Standards
Regarding the Exercise of Voting Rights Associated with Cross-shareholding

First as a Japanese bank•	Transition to a company with three committees

	Introduced a group-wide
in-house company systemmodel of corporate governance•	Disclosed Corporate Governance Guidelines

1999
First as a Japanese bank	Announcement of establishing afinancial services group2013
Established a strategy of group-wide
collaboration among banking, trust
banking, and securities functions

2014

2015

First as a Japanese bank	Merger of banks and merger of securities companies

2016

2017

	An outside director was appointed as Chairman of the Boardof Directors as well as the Chairman of each of the threelegally required committees
	Announced our advisor system prior to the beginning of
the Tokyo Stock Exchange (TSE) disclosure system

Compliance with Japan’s Corporate Governance Code
Our Corporate Governance Guidelines set out the fundamental perspectives regarding corporate governance at Mizuho, and the framework of the corporate governancesystem, including the roles, composition, and governing policies regarding the Board of Directors, executive officers, Nominating Committee, Compensation Committee,
and Audit Committee for Mizuho Financial Group as a Company with Three Committees. In addition, the Corporate Governance Report, which sets out the status of thecorporate governance system of the group, is submitted to the TSE and posted on the websites of the TSE and Mizuho Financial Group.
Advisor system
In some cases, Mizuho group companies appoint personnel, who have previously served as President and Chief Executive Officer or in other senior positions, as senioradvisors or honorary advisors (“Advisors”). These Advisors are responsible for assisting the company and its subsidiaries in fulfilling their social responsibilities andcontributing to the further development of these activities. For this purpose, Advisors oversee the activities of economic organizations and activities that contribute tosociety. Agreements with these Advisors stipulate that they will not be involved in corporate management.
Corporate Governance Guidelines
https://www.mizuho-fg.com/company/structure/governance/pdf/g_guideline.pdf

71

Mizuho Financial GroupCorporate Governance Reporthttps://www.mizuho-fg.com/company/structure/governance/pdf/g_report.pdf

Foundations for our corporate value Corporate governanceInterview with the Chairman of the Board of Directors

Mizuho is building an advanced corporate governance system with the aim ofincreasing our corporate value.
How the Board of Directors meetings are conducted
One of Mizuho’s most important tasks is increasing our earnings power. During the 14 meetingsof the Board of Directors held in FY2017, the most time was devoted to cost structure reform
and identifying the issues that must be addressed to make the in-house company system asuccess. Since a new medium-term business plan will be prepared during the current fiscal
year, the results of these Board meetings will be reflected in the plan, and we will do our utmost
to attain our objectives.

My focus as the Chairman of the Board of Directors
For the past four years, I have focused on raising the quality of discussions in the Board of
Directors meetings. By having an outside director serve as the Chair of the Board, the sense ofcounterbalance with the members responsible for execution of business policies is maintained,
and this is very important for effective corporate governance. However, in addition to having
a sense of counterbalance in the meetings, we also need to foster trust between management
and the outside directors. This is why we make arrangements frequently for discussions outside
the regular Board of Directors meetings where management and the outside directors can
exchange opinions in a more informal setting. Going forward, I will continue to work together
with the Board members to ensure that the Board of Directors truly fulfills its role.

What is most important for increasing Mizuho’s corporate value
Mizuho is definitely undergoing change, but our governance system can be said to have beensuccessful only when we achieve a substantial increase in profitability. This means we must
work much harder and implement further reforms. In addition to making fundamental structuralreforms, we must clarify our business portfolio, implement our branch transformation
strategy, and take other initiatives. Moreover, other issues going forward include the need togo much deeper in terms of efforts to raise productivity and make major improvements in our
fundamental earnings power. We at Mizuho have a broad customer base as well as top-classtalent. How we can draw on these resources to demonstrate our potential strengths will holdthe key to success. A key element will be our personnel evaluation system; we have changed
this system by going beyond deducting evaluation points for mistakes that may have been
made and now give credit for accepting and tackling challenges even if the attempt ends infailure. I know it will not be easy to change the mind-set of each and every employee in thisregard. It will take time to show results, but doing so will make Mizuho an open and strongorganization.
This fiscal year is the final year of our current medium-term business plan, and we must be
accountable for results over the past three years under the plan. I would like to conduct theBoard of Directors so that outside directors and management will share a sense of urgency anda drive to get things done.

What we expect to accomplish under the new corporate governance system
In April 2018, we were off to a new start under the leadership of our CEO, Tatsufumi Sakai. As amember of the Nominating Committee, I was involved in his selection as the CEO. I am looking
forward to Mr. Sakai’s strong energy as well as his capabilities for dealing with difficult issues
to see us through this period of rapid change. We will aim to have the business execution
side led by Mr. Sakai and the outside directors share a common vision and support Mizuho’stransformation.

Hiroko Ota Chairman of the Board of Directors

2018 Integrated Report72Foundations for our corporate value

Corporate governanceCorporate governance system
We have adopted a Company with Three Committees model of corporate governance with the belief
that, under the current legal system, this model is the most effective as a means of realizing theobjectives of our basic policy regarding Mizuho Financial Group’s corporate governance system.
 omposition of the Board ofC
Directors
 on-executive directors
Nshall comprise a majority ofthe directors in the Board of
Directors.
 hairman of the Board ofC
Directors
The
Chairman shall, in
principle, be an outside
director.
 omposition of theC
Nominating Committee andCompensation CommitteeIn principle, all members shallbe appointed from among theoutside directors.
 hairmen of the Nominating
C
Committee, Compensation
Committee, and Audit
Committee
Thechairman of eachcommittee shall be an outside
director.
 valuating the effectivenessEof the Board of Directors
The Board of Directors shallperform an analysis andevaluation of the effectivenessof the Board of Directors asa whole each year and shalldisclose a summary of theresults. Based on such analysis
and evaluation of effectiveness,in order for the Board of
Directors to exercise its
management oversight role tothe maximum extent, the Board
considers and implements
necessary measures. For further
details, please refer to our
website:https://www.mizuho-fg.
com/company/structure/
governance/structure.html
 verview of IndependenceO
Standards
For Mizuho Financial Group’s
Overview of IndependenceStandards of Outside Directors,
please refer to our website:https://www.mizuho-fg.
com/company/structure/
governance/pdf/o_director.
pdf

73

Mizuho Financial Group

General Meeting of Shareholders

Supervision

Determines the content of proposals regarding the appointment
and dismissal of directors

Appointment of directors

Note: The persons appointed as chairs of the Nominating,Compensation, and Audit Committees are outside directors.

Board of Directors
Outsidedirectors:

Nominating
Committee

Chairman

Determines the content ofproposals for the General
Meeting of Shareholders regarding
the appointment and dismissalof directors
All members, in principle, shall be outside directors.

Chairman

Human Resources Review Meeting

Internal non-executive
directors:
Internal directors who
concurrently serve as
executive officers:

Determines
compensation
Compensation Chairman
Committee
Audits theexecution ofdutiesAll members, in principle, shall be outside directors.

Audit
Committee

The Chairman shall, in principle, be an outside director.
Non-executive directors shall comprise a majority ofthe directors.

Determines the compensationfor each individual director
and executive officer

Chairman

Audits the legality andappropriateness of theexecution of duties by directors
and executive officers
The majority of members shall be outside directors

Outside Director Session

Risk Committee

Appoints and dismisses executive officers
Delegates decisions on business execution
Audits the execution of duties
by executive officers

Supervises the execution of duties

Management

Executive
officers

Determines the compensationfor executive officers

President & Group CEO

Makes decisions on business execution, based on delegation from the Board of Directors,
and implements business execution

Directors
Appointment of directors
In the course of appointing directors who
concurrently serve as executive officers,
candidates to be appointed as directors are
personnel who satisfy matters such as theappointment policy set out by the Nominating
Committee, and executive officers such as theGroup CEO and others who have been
appointed to roles (CFO, CRO, CCO, CSO, etc.)
where their duties include carrying out checks
and balances with respect to the management.
Each candidate to be appointed as an outside
director must satisfy the following in order tofully exert his or her supervisory function.
(1)The candidate has deep insight andknowledge and extensive experience inareas such as corporate management, risk
management, compliance with laws andregulations, crisis management, financial

accounting, internal control, macroeconomic
policy (including finance and industry),organizational and cultural reform, or global
management.
(2) The candidate has the ability to obtain an
overview and understanding of the overallmanagement of Mizuho, the ability to grasp
essential issues and risks, and the ability toappropriately interview management andexpress opinions to and persuademanagement.
(3) It is recognized that the candidate isindependent from the management of thegroup in light of the IndependenceStandards of Outside Directors of Mizuho
Financial Group.

Foundations for our corporate value Corporate governanceOutside directors
Outside directors and reason for their appointment
Name

Reason for appointment as an outside director

Tetsuo Seki

Expected to contribute to (i) strengthening the effectiveness of both thedecision-making and supervisory functions of Mizuho Financial Group’s
Board of Directors and (ii) Mizuho Financial Group’s effort to further
enhance internal control systems and group governance, leveraging
his extensive experience and deep insight as a top executive.

Takashi Kawamura

Expected to contribute to (i) strengthening the effectiveness of both thedecision-making and supervisory functions of Mizuho Financial Group’s
Board of Directors and (ii) Mizuho Financial Group’s effort to enhancegroup governance, leveraging his extensive experience and deep
insight as a top executive who has implemented bold management
and corporate governance reforms.

Tatsuo Kainaka

Expected to contribute to (i) strengthening the effectiveness of both
the decision-making and supervisory functions of Mizuho Financial
Group’s Board of Directors and (ii) the further enhancement of thecorporate governance, compliance, and risk management system ofMizuho Financial Group, leveraging his extensive experience, deep
insight, and high level of expertise as a prosecutor, judge, and attorneyat-law.

Hirotake Abe

Expected to contribute to strengthening the effectiveness of both
the decision-making and supervisory functions of Mizuho Financial
Group’s Board of Directors, leveraging his extensive experience, deep
insight, and high level of expertise as a certified public accountant.

Hiroko Ota

Expected to contribute to strengthening the effectiveness of both
the decision-making and supervisory functions of Mizuho Financial
Group’s Board of Directors, leveraging her extensive experience, deep
insight, and high level of expertise as a university professor and a
Minister of State for Economic and Fiscal Policy of the Cabinet Office,which includes, among other things, the ability to see things from amacroeconomic perspective (e.g., from a public policy and economic
policy perspective) as well as a high level of awareness of the problems
that must be resolved for the revival of the Japanese economy.

Izumi Kobayashi

Expected to contribute to strengthening the effectiveness of both
the decision-making and supervisory functions of Mizuho Financial
Group’s Board of Directors, leveraging her extensive experience anddeep insight as a top executive who has served both in and outside
Japan.

Director training
We provide our directors with opportunities to acquire andimprove knowledge that is necessary to fulfill their expectedroles and duties, at the time of appointment and continuously
thereafter.

1. Offering all directors opportunities for acquiring knowledge
and self-improvement
 raining is provided for newly appointed directors, mainly regarding the duties andT
responsibilities of directors, and is conducted by an outside instructor (lawyer).
 raining is also held and conducted by an outside instructor regarding complianceTand customer protection and awareness of human rights/LGBT related issues.
 irectors gain an overall perspective of the management of the group by discussingDvarious proposals, reports, and other activities in the Board of Directors’ meetings
 hen necessary for the performance of duties, directors in charge of various areasWmake individual presentations; advice and instruction is provided by external
specialists, and training is provided (at the company’s expense).

2. Opportunities to acquire and improve knowledge for outside
directors
At the time of appointment
Acquiring an understanding of the group’s financial and other businessesIntensive explanation at the time of appointment will be conducted individually foreach newly appointed outside director.
Explanations from executive officers in charge of different business areas, theDeputy Chairman of the Board of Directors, and the General Manager of the
Corporate Secretariat regarding Mizuho’s Corporate Identity, business domain,
business strategy, medium-term business plan, annual business plan, organizational
structure/authorities, finances, risk/compliance management, human resources,
IT systems/operations, internal audits, corporate governance system, etc.

Post-appointment (the examples below were conducted for fiscal 2017)
Strengthening ties with the frontlines of the business rranging for opportunities for workplace visits, including Head Office departments,
A
trading rooms, and Asset Management One
Sitting in on meetings of the general managers of the Three Core Companies*
Deepening understanding of Board of Directors’ proposals
 roviding for thorough explanations of Board of Directors’ proposals in advanceP
and follow-up (after each Board meeting)
Improving communication at times other than the Board of Directors’ meetings
Off-site meetings regarding business operations
 or holding open discussions among outside directors, heads of in-houseF
companies, and President & CEOs of the Three Core Companies* unches following the Board of Directors meetings and receptions and dinners forLoutside directors and executive officers
 eetings to exchange information with the internal directors and opportunitiesM
to acquire other necessary knowledge and share information about financial
innovation and other topics
Outside director session
 hese meetings are held to exchange opinions regarding dealing with shareholder
T
proposals and the operations and effectiveness of the Board of Directors.
*Three Core Companies: Mizuho Bank, Mizuho Trust & Banking, Mizuho Securities

2018 Integrated Report74Foundations for our corporate value

Corporate governance omposition of the Board ofC
Directors
6 outside
directors

Board of Directors

5 directors
who
concurrently
serve asexecutive
officers

9 non-executive
directorshLaw:

3 directors
1 director

Finance/accounting:

1 director

Economic andfiscal policy:

1 directoraPositive and trustworthy public image

6 directors
7 directors
1 directora Hisashi Kikuchi

Definition of terms
FG: Mizuho Financial Group
BK: Mizuho Bank
TB: Mizuho Trust & Banking
SC: Mizuho Securities
CB: Mizuho Corporate Bank
The former Mizuho Bank andthe former Mizuho Corporate
Bank conducted a merger
on July 1, 2013, whereby theformer Mizuho Corporate Bank
was the surviving company
in an absorption-type merger
and changed its trade name toMizuho Bank.
For further details on the
backgrounds of directors,
please refer to our website:https://www.mizuhofg.com/company/info/
executives/index.html

Mizuho Financial Groupb Hiroko Ota

c Ryusuke Aya

Member of the Board of
Directors

Outside director
Chairman of the Board of Directors /Member of the Board ofManaging Executive Officer / Headof Strategic Planning Group (Group

Member of the Nominating
Committee

Deputy Chairman of the Board of Directors

CSO)
Career highlights(entity / year of appointment) eneral Manager of Tokyo Corporate
G
Banking Division (BK/2013)
General Manager of Corporate
Secretariat (FG, BK/2015)h Takashi Kawamura
Outside director
Member of the Nominating
Committee (Chairman) / Memberof the Compensation Committee

Career highlights (year of appointment)Representative Executive Officer,
Chairman, President and Chief
Executive Officer, Hitachi (2009) hairman of the Board of Directors
C(Outside director), Tokyo Electric Power(current)75bc

Tenure of directors
less than 3 years:
3 years or more but
less than 6 years:
6 or more years:j

8 internal directors

 rea of expertise ofA
outside directors
Corporate
management:i

Directors
Member of the Audit Committee / Memberof the Risk Committee (Chairman)

Career highlights (year of appointment) inister of State for Economic andM
Fiscal Policy (2006)
Professor, National Graduate Institutefor Policy Studies (current)i Yasuyuki Shibata
Member of the Board of
Directors
Managing Executive Officer / Headof Risk Management Group (GroupCRO)
Career highlights(entity / year of appointment) eneral Manager of Americas Treasury
G
Division (BK/2014)
General Manager of Risk Management
Department (FG, BK/2016)

Career highlights(entity / year of appointment) ead of Risk Management Group
H(FG, BK/2013)
Member of the Board of Directors(Audit & Supervisory Committee
Member) (BK/2017)

j Hirotake Abe
Outside director
Member of the Compensation
Committee / Member of the Audit
Committee

Career highlights (year of appointment)
CEO, Tohmatsu & Co. (2001)
Certified Public Accountant (current)

Foundations for our corporate value Corporate governance

k

l

d

m

e

n

g
f



Internal directord Takanori Nishiyama

Outside director

Director who concurrently serves as an executive officer

e Makoto Umemiya

f Tatsufumi Sakai

Non-executive director

g Izumi Kobayashi

Member of the Board of
Directors

Member of the Board of
Directors

Member of the Board of
Directors

Outside director
Member of the Nominating

Managing Executive Officer / Headof Compliance Group (Group CCO)Managing Executive Officer / Headof Financial Control & Accounting

President & Group CEO(Representative Executive Officer)

Committee / Member of the Risk
Committee

Group (Group CFO)
Career highlights(entity / year of appointment)

Career highlights(entity / year of appointment)

Career highlights(entity / year of appointment) eneral Manager of Omiya BranchG(BK/2014)
Executive Officer in charge of Corporate
Banking (BK/2015)
Executive Officer in charge of Banking(BK/2016)

 eneral Manager of Osaka BranchG(BK/2012)
General Manager of Financial Planning
Division (FG, BK/2014)

k Tetsuo Sekil Yasuhiro Satom Nobukatsu Funaki

Member of the Board of
Directors
Chairman*Member of the Board of
Directors
Member of the Audit Committee

Outside director
Member of the Nominating Committee /Member of the Compensation Committee /Member of the Audit Committee(Chairman)

Career highlights (year of appointment)Representative Director and Executive
Vice President, Nippon Steel (2000)
President (Representative Director),
Shoko Chukin Bank (2008)

 ead of Investment Banking Unit
H
(FG, BK, CB/2013)
Head of International Banking Unit
(FG, BK/2014)
President & CEO (SC/2016) resident and Representative Director,P
Merrill Lynch Japan Securities (2001)
Executive Vice President, theMultilateral Investment Guarantee
Agency, the World Bank Group (2008)

n Tatsuo Kainaka
Outside director
Member of the Nominating Committee /Member of the Compensation Committee(Chairman) / Member of the Audit*Chairman Sato engages in thecompany’s external activities, but does
not chair the board meetings

Career highlights(entity / year of appointment)
President & CEO (CB/2009, BK/2013)
President & Group CEO (FG/2011)

Career highlights (year of appointment)

Committee

Career highlights(entity / year of appointment)
Audit & Supervisory Board Member(CB/2010, FG/2013)
Audit & Supervisory Board Member(outside auditor) (SC/2013)

Career highlights (year of appointment) uperintending Prosecutor of the TokyoS
High Public Prosecutors Office (2002)
Justice of the Supreme Court (2002)
Attorney-at-law (current)

2018 Integrated Report76Foundations for our corporate value

Corporate governanceOperation of the Board of Directors and each committee
Board of Directors

Nominating Committee

Hiroko Ota

Board/Committee Chairman

Takashi Kawamura

Chairman of the Board of
Directors

Chairman

The main roles of the Board of Directors are making decisions on
business execution such as the basic management policy, which
are matters to be determined solely by the Board of Directors
under laws and regulations, and supervising the executionof duties by directors and executive officers as defined in the
Companies Act. The Board of Directors has delegated decision
making, in principle, to the President & Group CEO for mattersother than those to be determined solely by the Board of
Directors under laws and regulations. The Chairman of the Boardof Directors plays a central role in narrowing down the agendas
to concentrate on truly necessary proposals and, regarding
proposals associated with core management issues, the Boardof Directors promotes comprehensive discussions of essential
points in an open and vigorous manner with the inclusion ofexpert opinions and suggestions from outside directors.

Main roles

 he Chairman is an outside director.
TThe majority of the Board of Directors is comprised of nonexecutive directors.

Composition

 he Chairman is an outside director.
TThe members are outside directors.

Operation

The Board of Directors held 14 meetings during fiscal 2017, andduring the meetings, in-depth discussions were held regarding
the overall concept of the fundamental structural reforms that
Mizuho should be implementing as well as individual topics
related to these reforms and issues linked with our next mediumterm business plan. Meetings also included reports covering thecurrent state of risk governance, risk management, compliance,
and internal control.

The committee held 14 meetings in fiscal 2017 and, among
other decisions, decided on the director candidates for Mizuho
Financial Group, including the new Group CEO, and approved theselection of directors and representative directors of the Three
Core Companies.

Number of meetings in fiscal 2017
(average attendance)

14 meetings (98%)

14 meetings (100%)

In the preparation of the fiscal 2018 business plan, Board of Directors’ discussions
were held from an early stage and directors were deeply involved in each process.
The executive officers and outside directors collaborated on the preparation of the basic strategy
framework embodied in the basic management policies.
Reflected opinions ofoutside directors

DecemberReflected opinions ofoutside directors

January

Reflected opinions ofoutside directors

February

March

Macro-environment
Key management
issuesDiscussion of issues
related to profitability
and financial positionin the current
macroeconomic
environment andsharing of informationon the directionof business plan
preparation.

77

The Nominating Committee is comprised mainly of outside
directors who are sufficiently independent from the managementof the group, and the role of the Nominating Committee is ensuring
objectivity and transparency in the process of appointing executives.
The Committee determines the content of proposals regarding
the appointment and dismissal of directors of Mizuho Financial
Group to be submitted to the General Meeting of Shareholders andexercises the approval rights held by Mizuho Financial Group withrespect to the appointment and dismissal of directors of each of
the Three Core Companies and exercises the approval rights heldby Mizuho Financial Group with respect to the appointment andremoval of representative directors and senior directors of the Three
Core Companies. Also, the Nominating Committee deliberates on
succession planning for the Group CEO.

Mizuho Financial Group

Group-wide basic
policyBasic policies of
in-house companies

As part of theformulation of thegroup-wide basic
policy, discussed
basic policies, priority
strategies that should
be formulated bymanagement, etc.

As part of theformulation of thebasic policies of inhouse companies,
discussed each inhouse company’s
annual operating
policy, earnings plan,etc.

Business plan
decisions

Initiatives related to planning for the
next Group CEO (succession planning)
Since adopting a Company with Three
Committees model of corporate governancein 2014, the Nominating Committee began
succession planning for the Group CEO.
In fiscal year 2017, the Nominating Committee
held a number of meetings and made their
examination from various angles ranging fromthe timing of the succession of Group CEO
Yasuhiro Sato to the decision on the candidate
to be appointed as a director on the premise thatthe next Group CEO would assume his office.
For more information on succession planningand the process for the committee’s decision on
the succession of the Group CEO in April 2018,
please refer to the following report:
Corporate Governance Reporthttps://www.mizuho-fg.com/company/structure/
governance/pdf/g_report.pdf

Foundations for our corporate value Corporate governanceCompensation Committee

Tatsuo Kainaka

Tetsuo Seki

Chairman

Chairman

The Compensation Committee is comprised mainly of outside
directors who are sufficiently independent from the management of
the group, and the role of the Compensation Committee is to ensure
objectivity and transparency in the process of deciding on executive
compensation.
The Compensation Committee determines the compensation for eachindividual director and executive officer, as defined in the Companies
Act of Mizuho Financial Group, exercises the approval rights held byMizuho Financial Group regarding compensation of each individual
director of the Three Core Companies, and determines the basic
policy and executive compensation system for Mizuho Financial
Group and the Three Core Companies. The committee considers suchfactors as Mizuho Financial Group’s medium- to long-term businessperformance and examples of other companies, including those in
the same industry as well as economic and social circumstances,and engages in repeated deliberations regarding the compensation
system based on the role and responsibility assigned to each officer,
and makes necessary revisions.

 he Chairman is an outside director.
TThe members are outside directors.

Risk Committee

Audit Committee

The main roles of the Audit Committee are auditing the legality
and appropriateness of the execution of duties by directors
and executive officers as defined in the Companies Act. For thispurpose, the Audit Committee obtains timely and appropriate
reports and explanations from directors, executive officers as
defined in the Companies Act, employees, and the independent
auditor and gives instructions and recommendations whennecessary. In addition, the Audit Committee ensures theeffectiveness of its audits by confirming the processes
and content of decision making by the business execution
departments through measures by the full-time Audit Committee
members such as arranging for the attendance at important
meetings held by the business execution departments,
examining important decision-related documents, andcoordinating operations with the Internal Audit Group and othergroup units.

 he Chairman is an outside director.
TThe majority of the Audit Committee is comprised of outside
directors.

The committee held 9 meetings in fiscal 2017, and discussions
covered the executive compensation system for Mizuho Financial
Group and the Three Core Companies. The Committee alsodecided on the compensation of individual Mizuho Financial
Group directors and executive officers as defined in the
Companies Act and approved the compensation of the individual
directors of the Three Core Companies.

In fiscal 2017, the Audit Committee held 17 meetings andreceived reports regarding the state of performance of duties by
the directors and executive officers as defined in the Companies
Act, including as pertains to the management of groupcompanies. The committee also confirmed the effectivenessof different auditing practices particularly that of the internal
control system, and provided advice on a range of topics asneeded.

9 meetings (97%)

17 meetings (100%)Compensation Policy
The Mizuho Financial Group Compensation Policy stipulates items concerning the determination ofcompensation for each individual director, executive officer, and specialist officer of Mizuho Financial
Group as well as the Three Core Companies.
Compensation Policy

https://www.mizuho-fg.com/company/structure/governance/pdf/compensation.pdf

Officers responsible for business execution

Stock
Compensation (I, II) Base
Salary32.5%
50%

Performance
Payment
17.5%

 he basic compensation system
Tshall consist of a Base Salary,
Performance Payment, and Stock
Compensation I and II.
The Performance Payment andStock Compensation II shall bewithin the range of 0% to 150%of the standard amount for eachposition, and the system enables
a certain amount of deferredpayments of the performance
payments to be paid over three
years, as well as a decrease orforfeiture of the deferred amount
depending on performance of thecompany or the individual andother factors.

Non-executive officers responsible for management supervision

Stock
Compensation I Base
Salary15%85%

 ixed compensation, in principle,
F
shall consist of Base Salary andStock Compensation I.
Stock Compensation I shall be
paid at the time of retirement, anddepending on the performanceof the company or the individualand other factors, a portion of thedeferred compensation may be
reduced or forfeited.

The Risk Committee advises theBoard of Directors regarding
decision-making and supervision
relating to risk governance andsupervision of matters such as thestatus of risk management. In
principle, the committee consistsof three or more persons who
may be non-executive directors or
external experts, and their mandate
is to evaluate the consistency of
the group management policies,
basic risk strategies, and theimplementation of this strategy.
They are also responsible for
evaluating the risk profile of thegroup and the appropriateness ofrisk management and reportingon these matters to the Board of
Directors.
 uman Resources Review
H
Meeting
The Human Resources Review
Meeting is responsible fordeliberating on the proposals
and requests to be decided by
the Board of Directors for theappointment or dismissal of Mizuho
Financial Group executive officers
as defined in the Companies Act,and the appointment, removal, andassignment of Mizuho Financial
Group executive officers as definedin the Companies Act with special
titles and executive officers as
defined in our internal regulations
with special titles. The Human
Resources Review Meeting is also
responsible for deliberating on
the proposals and requests to beapproved by the Board of Directors
for the appointment, removal, andassignment of executive officers as
defined in our internal regulations
with special titles at the Three Core
Companies. To secure transparency
and fairness in the appointment ofexecutive officers, the committee
is comprised of members of theNominating Committee, membersof the Compensation Committee,
and the Group CEO.
Outside Director Sessions
Outside Director Sessions are held,in which only the outside directors
are present, for the purposesof exchanging information andreaching a common understanding
from an objective and frankoutsider’s perspective. Thesemeetings are held two times ormore each year, and topics include
management issues, the operationof the Board of Directors, and how
the corporate governance systemshould be maintained. Reportson the meetings are presented asnecessary to the Group CEO.

2018 Integrated Report78Foundations for our corporate value

Risk governanceRisk governance is a part of Mizuho’s corporate governance framework, centered on our risk appetite framework (RAF). The Board of
Directors determines fundamental matters regarding the RAF, along with its management systems and specific risk appetites, andincorporates these in document form as the risk appetite statement (RAS). At Mizuho, we also work to foster and promote a soundrisk culture to support this risk governance framework. The effective administration of the RAF leads to the creation of a sound risk
culture, and at the same time, cultivating a sound risk culture creates a foundation for the disciplined risk-taking and risk communication
which are promoted as part of the administration of the RAF. To ensure strong risk governance, we maintain a risk management andcompliance structure that operates in accordance with the principles of the “three lines of defense.”

Risk culture
We foster a sound risk culture in which all executive officers andemployees maintain a high level of awareness regarding risk, andendeavor to make proper judgements and take appropriate actions
rooted in good sense and ethical standards. Such judgement andactions allow us to achieve our risk appetite and enhance ourcorporate value.
We have also established Behavioral Guidelines for a Sound Risk
Culture, and work to ensure that executive officers and employees
understand these principles through messages from senior
management, training sessions and other measures. For Mizuho
to put the “customer first principle” into practice and enhance ourcorporate value, it is essential that all members maintain an attitude

of not simply avoiding risk, but rather taking appropriate risk. These
guidelines provide a foundation for the appropriate values andcourses of action for Mizuho’s executive officers and employees totake when approaching risks. The guidelines are aligned with thefive Mizuho Values that form a part of Mizuho’s Corporate Philosophy,
and executive officers and employees can refer to them when they
are unsure of a judgement that needs to be made in their daily
work. Putting these guidelines into practice improves our ability toaddress and counter risks, and fosters a sound risk culture.
These initiatives are also important from the standpoint of internal
control, ultimately helping to prevent inappropriate behavior by
executive officers and employees.

Risk appetite framework (RAF)
The purpose of our RAF is to maximize our corporate value by
securing sustainable and stable profits, and to fulfill our social
responsibilities. Based on such purpose, our core risk appetite
is to take appropriate risk and provide solutions based on ourcustomers’ actual needs, establishing our competitive advantage
against our peers.
We have positioned the RAF as the corporate management
framework to support taking the types and levels of risk that

we will accept in order to implement our business and financial
strategies. We will further concretely define our risk appetite in
our medium-term and fiscal year business plans. The risk
appetite forms the basis for establishing our business strategy,
resource allocation, and earnings plans as well as monitoring
the operating status, thus integrating risk management,
business strategy, and profits in order to achieve disciplinedrisk-taking that achieves an optimal balance of risk and return.

Mizuho’s RAF Control Structure

Supervision
Board of Directors
 etermines basic matters regarding RAF
D
and RAS
Supervises business execution by the
management based on the above determinations

Management
President & Group CEO
Executive Management Committee
 ormulates risk appetite policyFEstablishes risk appetite metrics/level
Formulates RAS

Audit Committee
 udits the execution of duties by the executiveA
officers and the management regarding RAF
Risk Committee
 dvises the Board of Directors and makes
A
proposals to the management regarding
risk governance79

Mizuho Financial Group onducts business operations
C
consistent with the risk appetite
Embeds a sound risk culture in eachline of business

Risk Management Committee (Chairman: Group CRO1)
Monitors the operation of RAF
Balance Sheet Management Committee (Chairman: Group CFO2)
 ormulates and promotes balance sheet management-centered strategies
F
related to risk control and risk-taking
1. Group Chief Risk Officer 2. Group Chief Financial Officer

Foundations for our corporate value Risk governance

Systems for operating the risk appetite framework
Our risk appetite consists of a risk appetite policy that serves as thefundamental policy regarding our risk-taking activities, and risk
appetite metrics that serve as a means of quantifying the level ofrisk-taking based on the risk appetite policy.
In implementing the RAF, the Board of Directors decides on basic
matters, including the risk appetite policy, metrics, and levels of
risk, and operations are supervised based on the Board’s decisions.
In addition, the Risk Committee, which advises the Board of
Directors, provides advice regarding risk governance and offers
suggestions to management.

Formulation and monitoring of risk appetite
Risk appetite is determined through management discussions on theoutlook for external factors such as the macroeconomic, regulatory,
and competitive environment, along with potential risk events suchas economic slowdown and turbulence in financial markets.These
are then incorporated into main and risk scenarios that are sharedinternally.
We then formulate a group-wide risk appetite policy based on ourawareness of these external environments, create specific strategies
and measures according to this policy, and determine corporate
resource allocation and earnings plans. Our risk appetite metrics are
expressed in terms of capital strength, profitability, and liquidity,
utilizing measures such as CET1 Capital Ratio, ROE, and LCR.
Further, the risk appetite for the entire group is shared with thein-house companies that implement strategies, to ensure theOn the other hand, to implement the RAF in the course of business
operations, the Group CRO, Group CFO, and Group CSO provide
assistance overseen by the Group CEO, and implement businessstrategy, financial strategy, and risk management from an overall
perspective. Also, heads of in-house companies, units, and groups
are responsible for planning and implementing strategies based onrisk appetite, and as the individuals in charge of risk-taking, conduct
operations. Note that the Internal Audit Group provides objective
and comprehensive assessments of the effectiveness of the RAF
from an independent perspective and offers advice andrecommendations for addressing any issues that arise.

effectiveness of the RAF.The in-house companies in turn formulate
individual risk appetite policies to implement the group’s overall
policy, and set risk appetite metrics and levels to meet group metrics
and levels.
Monitoring of the operational status for the established risk appetite
is conducted by the Risk Management Committee (Chairman: GroupCRO) on a quarterly basis and as necessary. As part of this process,the Group CRO and each in-house company work to identify issues
related to risk and share information on these issues.This monitoring
enables timely and appropriate actions, including flexible revisions
to our risk appetite and strategies, to be discussed and carried out inthe event of changes in the external environment that increase risk or
impede our risk appetite and strategies.

Three lines of defenseline), along with an independent third line of internal auditing of
the first two functions. In addition, Mizuho Financial Group setsgroup strategies and allocates resources, monitoring theautonomous controls in the first line at core group companies inorder to strengthen the system providing appropriate responses.

Our definition of the three lines of defense

Our risk management and compliance framework

Third line

Internal audit function
The third line-of-defense is independent of the first andsecond lines and involves assessment and examination of theoperations of the first and second lines, and is responsible forproviding advice and guidance to settle issues.

Basic policies
Submit/report

3rd line

3rd line

Internal Audit Group

Core group companies*

 epartment(s) inDcharge of risk Internalmanagement/ audit
compliance

Basic policies
Submit/report

Monitoring
In-house companies/unitsFirst line-of-defense
autonomous control

Internal Audit GroupInternal
audit
2nd line

Internalaudit

 epartment(s) inDcharge of risk Internalmanagement/ audit
compliance

Monitoring
Report regarding thefirst line-of-defense
autonomous control
Formulate strategies,
allocate businessresources, etc.

1st line

Risk management and compliance function
The second line-of-defense oversees (monitors), measures,
and assesses the first line’s autonomous control activities
for risk management and compliance, and is responsible
for establishing and implementing basic policies for risk
management and compliance.

Mizuho Financial Group

2nd line

Autonomous control function
The first line-of-defense involves daily operations based on
the rules, procedures, and risk appetite, and has a primary
responsibility for risks and compliance matters accompanying
the conduct of business as a risk owner, and for performing
autonomous control activities (to identify, assess, andmanage/control risks and compliance matters).

1st line

Second line

First line

In accordance with the “three lines of defense” approach in the
Corporate Governance Principles for Banks released by the BaselCommittee on Banking Supervision, we ensure appropriate andeffective risk governance through a check-and-balance systemwith autonomous controls (first line) and monitoring (second

Divisions/unitsFirst line-of-defense
autonomous control* Of the core group companies, Mizuho Bank, Mizuho Trust & Banking, Mizuho
Securities, and Trust & Custody Services Bank conduct risk management andcompliance based on the “three lines of defense” concept.
2018 Integrated Report80Foundations for our corporate value

Comprehensive risk management

 or more information on ourFrisk management, please visit
our website.

Basic approach
For the group as a whole, in order to ensure
sound and stable corporate management andenhance our corporate value, appropriately
managing risk and controlling risk are key
issues relating to overall management, andtherefore we are working to put in place risk
management systems.

https://www.mizuho-fg.com/
investors/financial/edtf/

Comprehensive risk management systems
Amid the growing diversity and complexity ofbanking operations, financial institutions are
exposed to various risks, including credit,
market, information technology, legal, andsettlement risks. We recognize that conducting
operations tailored to the risks and managing
such risks is a key issue relating to overallmanagement. In order to implement ourbusiness strategies while maintaining ourfinancial stability, we maintain comprehensive
risk management and control measures.
Mizuho Financial Group maintains basic
policies for risk management established by
the Board of Directors that are applicable tothe entire group. These policies clearly define
the kinds of risks to be managed, set forth theorganizational structure, and provide for theemployee training necessary for appropriate
levels of risk management. The policies also
provide for audits to measure the effectivenessand suitability of the management structure. Inline with these basic policies, we maintainvarious measures to strengthen and enhance
the sophistication of our risk management
system.

81

Mizuho Financial Group

Mizuho Financial Group (the holding company)
has established basic policies for risk managementthat are applicable to the group as a whole. Inline with these basic policies, as a group weanalyze risk comprehensively from multiple
perspectives and adopt a variety of measures
to strengthen and enhance the sophisticationof our risk management system.

The Group CRO reports the risk management
situation to the Board of Directors, the Risk
Committee, and the Executive Management
Committee regularly and as necessary. In
addition, Mizuho Financial Group receives
reports and applications for approval concerning
the risk management situation from our coregroup companies and gives them appropriate
instructions concerning risk management as
necessary.
Each core group company maintains its systems
for managing various types of risk, receiving
reports on the status of risk at their respective
subsidiaries, and gives them appropriate
instructions concerning risk management as
necessary.
We classify and manage the risks that arise in
our businesses according to the various kindsof risk, including credit risk, market risk, liquidity
risk, and operational risk. Moreover, in each of
our group companies we adopt the same
approach of managing risks, such as settlement
risk, trust banking operations risk, and otherrisks appropriately given their nature.

Each of our subsidiaries adopts appropriate
risk management measures in line with theirbusiness domains and the scale and conditionsof the associated risks, while Mizuho Financial
Group controls risk management for the groupas a whole.

In addition to managing each type of risk
individually, we have established a risk
management structure to identify and evaluate
overall risk and to keep risk within limits thatare acceptable.

The Risk Management Committee chaired by theGroup CRO provides integrated monitoring andmanagement of the overall risk for the group.

In line with the basic policies relating to overallrisk management established by Mizuho
Financial Group, we are working to take evenmore proactive and sophisticated approaches
to risk management.

Foundations for our corporate value Risk governance

Mizuho Financial Group
Supervision/Audit

Management

Departments responsible for risk management
Comprehensive risks

Executive Management
Committee
Business policy committees

Risk Committee

Operational risk
Credit risk

Credit Risk Management Department

Information technology risk

IT & Systems Planning Department

Operations risk

Operations Planning Department

Legal risk

Legal Department

Human capital risk

Global Talent Planning andManagement Department

Tangible asset risk

Facility Management Department

Regulatory risk

Strategic Planning Department

Reputational risk

Corporate Communications
Department

Set risk management policies
Give instructions and approval concerning risk management

MHBK

MHTB

Risk Management Department

Market risk/Liquidity risk

Operational risk(e.g. Group CRO)

Officers responsible
for risk management

Board of Directors

President & Group CEO(e.g. Risk Management Committee)

Credit risk

Report the risk management situation
Submit applications concerning risk management

MHSC

Mizuho Americas

Other core group companies

Mizuho Bank

Supervision/Audit

Mizuho Trust & Banking

Management
Departments responsible for risk management

Risk capital Allocation
We endeavor to obtain a clear grasp of the group’s overall risk
exposure and implement measures to make sure this exposure is
within limits that are acceptable and are in accordance with therisk capital allocation framework.
More specifically, we allocate risk capital to our core groupcompanies (including their subsidiaries) to control risk within thelimits set for each company. We also control risk within acceptable
limits by working to ensure that the overall risk on a consolidated

Reputational risk

Regulatory risk

Tangible asset risk

Human capital risk

Legal risk

Operations risk

Information
technology risk

Operational risk

Market risk/
Liquidity risk

Credit risk

Comprehensive risksbasis does not exceed our financial strength. To ensure theongoing financial soundness of Mizuho Financial Group and ourcore group companies we regularly monitor the manner in whichrisk capital is being used in order to obtain an accurate grasp of
the risk profile within this framework. Reports are also submitted
to the Board of Directors and other committees of each company.
Risk capital is allocated to Mizuho Bank, Mizuho Trust & Banking,Mizuho Securities, and Mizuho Americas by risk category, and isfurther allocated within their respective business units.

2018 Integrated Report82Foundations for our corporate value

Framework for allocating risk capitalMizuho Financial Group (holding company)

Allocated risk capital

Setting of upper limits based on risk capital andexercise of control over various risks

Mizuho Bank
Mizuho Trust & Banking
Mizuho Securities
companies*

CapitalMizuho Bank

Risk exposure of the group

Risk exposure of core group

Financial strength of
the group

ExamplesCredit risk
Market risk
Stock price risk
Operational risk

Allocated tooperatingunits

Group companies

Mizuho Americas
Mizuho Trust & Banking

Mizuho Securities

Other risks

Mizuho Americas*Includes the risk exposure of group companies that are managed by core group companies

Risk Category

Definition

Credit risk

The group’s exposure to the risk of losses that may be incurred due to a decline in, or total loss of, the valueof assets (including off-balance-sheet instruments), as a result of deterioration in obligors’ financial position.

Market risk

The risk of losses incurred due to fluctuations in interest rates, stock prices, and foreign exchange rates.
Our definition includes the risk of losses incurred when it becomes impossible to execute transactions in
the market because of market confusion or losses arising from transactions at prices that are significantly
less favorable than usual.

Liquidity risk

The risk of losses arising from funding difficulties due to a deterioration in our financial position that makes it difficult
for us to raise necessary funds or that forces us to raise funds at significantly higher interest rates than usual.

Operational risk

The risk of losses that may be incurred resulting from inadequate or failed internal processes, or systems,
human error, or external events. Operational risk consists of several components such as information
technology risk and operations risk.
Refer to page 15 of Risk Management Structure in the Appendix for specific components of operational risk.

Top risks
For risks that are recognized to have a major potential impact
on the group, we specify these as “top risks” and haveintroduced top risk management methods.
Based on assessments of the likelihood, impact, and othercharacteristics of monitored risks, and after careful deliberation
by management, top risks are designated and managed
accordingly. Through this approach, we endeavor to deepen
communication regarding risks, seek to create common
perspectives regarding risks, and work to secure consistency inawareness of various types of risks.

83

Mizuho Financial GroupFor the top risks that are identified, the status of controls is
confirmed, and, when deemed necessary, consideration is
given to additional risk controls. In addition, by reflecting these
considerations in stress test scenarios, we can verify using
quantitative analysis the appropriateness of business operationplans and confirm the adequacy of capital.
Furthermore, when deciding on top risks, we consider thetiming and probability of the emergence of such risks in a timeframe of about one year, and review these considerations
every six months.

Foundations for our corporate value Risk governanceTop risks

ExamplesRebound in credit
related costs

 udden deterioration in the credit standing of obligors where we are heavily exposed and in credit
S
standing of major clients
Deterioration in regional economies/turmoil in financial markets due to geopolitical factors
Slowdown in the Chinese economy and detrimental impact on emerging countries in neighboring areas

Sudden drop in thevalue of assets

 ise in European/US interest rates, adjustments in stock and real estate prices in reaction toRoverheated market conditions, and resulting negative wealth effects
Decline in stock prices, fluctuations in currency values, drying up of liquidity due to turmoil in financial markets

Destabilization offoreign currency
procurement

 nexpected outflows of funds, deterioration in liquidity conditions due to turmoil in financial markets,Uand accompanying rise in funding costs

Major system
failureEmergence of costs due to IT system failures, government fines, etc., and damage to reputation

Cyber attacks

 mergence of additional costs and damage to reputation due to suspension of services as a result ofEcyberattacks, data falsification, information leakage, improper funds transfer, etc.

Money laundering/
provision of funds
for terrorism

 overnment fines/penalties and damage to reputation because of flaws in policies to prevent moneyGlaundering and supplying funds for terrorism

Improper market
transactions

 overnment fines/penalties and damage to reputation because of market manipulation or otherGcompliance violations

Note: The risks described here are only some of the possible risks we are aware of. For more comprehensive information on the group’s risks, please refer to our Securities
Report, Form 20-F, and other related documents.

Stress testing
We assess the suitability of our risk appetite and the validity ofour business plans through stress testing of Mizuho Financial
Group’s entire portfolio by calculating and assessing thefinancial effect on our capital adequacy ratio and on businessof the main and risk scenarios we have determined.
Using stress testing, we can confirm whether our capital
adequacy ratio, performance, and other indicators are sufficientin the event that scenarios actually materialize. If the capital
adequacy ratio and results fall below the necessary level, we
reconsider and revise our risk appetite and business results if
necessary. In addition, we calculate the impact to risk capital,
including interest rate risk in the banking book and we use
post-stress risk capital to assess the adequacy of the capitallevel when a risk scenario emerges.

Note that scenarios are formulated taking into consideration
Mizuho’s vulnerabilities and other factors, including the current
status of the economy and economic outlook.
Furthermore, to structure robust risk management systems,
stress testing is also used to manage risk in various risk
categories, such as market risk.
Our stress testing also serves as a foundation for understanding
the characteristics of our business portfolio and enables
planning in advance regarding the course of action whichshould be taken if the risk scenario occurs, and is conducted
regularly to enhance our risk management capabilities.

Mizuho’s stress testing

1. Preparing scenarios

2. Calculation of risk impact

3. Analysis and use of results

 urrent economic conditions andCfuture outlook
Vulnerabilities of the group’s businessand financial structure

 alculation of the impact on the groupC
when the risk scenario materializes
Main items to calculate: Capital adequacy
ratio, losses, VAR, etc.

 ppropriateness of risk-taking andAverification of suitability of thebusiness plans
Assessment of capital adequacy

Preparation of scenarios common
across the group2018 Integrated Report84Foundations for our corporate value

Compliance

Compliance
As a leading Japanese financial services group with a global presence and a broad customer base, we
remain conscious at all times of the importance of our social responsibilities and duty to the public.
We define compliance as the strict observance of all laws and regulations and the pursuit of fair andhonest business operations that conform to socially-accepted norms, and we view ongoing complianceas one of the basic principles of sound business management. Each of our group companies maintains
their own compliance structure in line with the basic policies established by Mizuho Financial Group.

Compliance structure

See our website for contact
information to make a report:
https://www.mizuho-fg.com/

company/internal/compliance/

The four core group companies also haveindividual compliance departments overseen bya Chief Compliance Officer. These departments
are responsible for compliance planning andimplementation and control overall compliancemanagement at each company. At eachorganizational unit (such as branches anddepartments) within the four core group companies,
the head of the organizational unit is responsible
for guidance and implementation related tocompliance matters, and the compliance officer orcompliance administrator at each organizational
unit reviews the status of compliance.
Mizuho Financial Group monitors the status ofcompliance of the group through reports submitted
by our core group companies and adopts
appropriate responses when necessary. Complianceat subsidiaries of our core group companies ismonitored and managed by their respective parent
company.

Compliance structure
Mizuho Financial Group
Supervision/
audit

hotlineMizuho Financial Group has
established a hotline run by an
external law office to receive
reports from in and outside thecompany in connection withproblems concerning internal
control and audits of accounts
and financial reports.

The President & CEOs of Mizuho Financial Group,
Mizuho Bank, Mizuho Trust & Banking, and Mizuho
Securities each generally oversees compliancematters for their respective company, and importantmatters concerning compliance are discussed at
the Compliance Committees chaired by the relevant
President & CEO.

Management

Internal control and audit

Board of Directors

Audit Committee

President & Group CEO

Executive Management
Committee
Compliance Committee(Chairman: President & Group CEO)Group Chief Compliance Officer(Department in charge: Compliance Department)

Every organizational unit
Head of each organizational
unit

Compliance officer/complianceadministrator

Core group companies (e.g. MHBK, MHTB, and MHSC)

Subsidiaries of the above group companies

Compliance practices
The Mizuho Code of Conduct sets forth clear andconcrete standards of ethical behavior, and is
distributed to all executive officers and employeesof the group. Furthermore, each of our groupcompanies has also prepared a compliance manual,
which serves as a practical guidebook for rigorouscompliance enforcement and clarifies the laws andregulations that we must observe in regards to ourbusiness operations and the compliance practices
we are required to follow. Each group company also
conducts compliance training for executive officers
and employees so that they are fully acquainted
with the content of the compliance manual.

85

Mizuho Financial GroupWe monitor the status of compliance levels
through self-assessments by each department
and monitoring conducted by the compliancedepartment of each company. In addition, every
fiscal year, each of our group companies establishes
a compliance program which contains concretemeasures for compliance enforcement such ascompliance framework management, training, andassessments. Progress on the compliance programis monitored every six months.

Foundations for our corporate value CompliancePreventing money laundering and financing of terrorism
In response to an increase in international demand in recent years
for the implementation of measures to prevent money launderingand terrorism financing, we have made anti-money launderingand countering terrorism financing a top management priority,
and we are implementing measures based on common policies
throughout the group. We implement various measures on a

global basis, such as performing customer due diligence (KnowYour Customer (KYC) practices) when establishing business
relationships, preventing transactions with organizations or
individuals that are subject to an asset freeze due to suspected
links to terrorism, and using monitoring systems and other means
to detect and report suspicious transactions.

Our stance towards organized crime
In order to prevent organized crime from influencing themanagement of our clients and to avoid any association withthe harm caused by organized crime, the Mizuho Code of
Conduct includes a policy covering our zero-tolerance stanceon business relationships with individuals or organizations thatare in any way associated with organized crime and therefore
threaten the rule of law, public order, and safety.
We have also formed an Anti-Organized Crime Committee
which includes external experts in industry-specific, in-depth
discussions on this subject, in addition to other initiatives weare implementing on a group-wide basis to ensure that wehave no direct or indirect associations with organized crime.
Moreover, drawing on the discussions in this committee, we
are implementing a range of policies on a global basis to utilize
IT systems and other advanced methods to detect and report

Measures for ensuring compliance
At Mizuho, compliance-related education and training are key
measures for ensuring appropriate compliance.
During fiscal 2017, Mizuho provided effective training tailoredto employees working in a broad range of roles within theorganization. We conducted 13 training sessions in total,
including mandatory compliance training sessions for all
employees; role-specific training for executive officers,
general managers, deputy general managers, complianceofficers, and other senior management members; ande-learning training sessions on specific compliance topics.
In addition, for executive officers, members of theCompliance Group, and other positions that requireparticularly high levels of compliance-related knowledge, we
provide more extensive training sessions, including sessions
taught by outside experts on topics related to the role ofcompliance in light of changes in the economic and social
environment.

on suspicious transactions and to prevent transactions withparties who are subject to Mizuho’s asset freeze criteria.
These matters are also discussed and reported on at meetingsof the compliance committees of Mizuho Bank, Mizuho Trust& Banking, and Mizuho Securities, which are chaired by the
President & CEOs or other senior management members ofthese group companies.
Furthermore, core group companies maintain centralized
departments or appoint an officer to manage anti-organizedcrime efforts and to maintain effective frameworks, for example,
by establishing a manual on how to manage such issues andconducting training sessions. If required, we consult with thirdparty experts and authorities on the handling of specific cases.

Main training topics
Fiduciary duties
Management of customer information (e.g. firewall regulations)
Preventing relationships with organized crimeCompliance-related points for financial groups (preventing
misuse of superior bargaining position, managing conflictsof interest, etc.)
In addition to training sessions and other programs designed
to promote compliance, we are also dedicated to detecting
potential compliance issues at the earliest stage possible andtaking appropriate action. When we become aware of potential
compliance issues, such matters must be reported immediately
to department and branch managers in accordance with ourcompliance manual. Furthermore, each group company has
established a hotline which employees can call in order tospeak with someone within the Compliance Division or an
external law office or compliance professional.
For matters related to inappropriate accounting, internal control
on financial reporting, and auditing, an internal control andauditing hotline, which connects to an external law office, isavailable to receive reports from both in and outside the company.

Internal reporting systems (Compliance hotline)
We have a robust internal reporting system in place, and are working to further increase its effectiveness by establishing groupwide reporting channels outside the workplace that are available in the evenings, on Saturdays and Sundays, and also by making
such services available in foreign languages. In order to ensure that employees at each group company are fully acquainted withthese systems, hotline numbers and other relevant information is included on posters within each workplace and distributed toall employees on wallet-sized cards. In fiscal 2017, Mizuho Financial Group and our core group companies received a total of 144
reports through our hotlines from both inside and outside the group, with the response status reported to our Audit Committee.

Internal control and audit hotline
Our audit hotline, which connects to an external law office, is available to receive reports from both in and outside the company in connection withconcerns regarding accounting and financial reports.

2018 Integrated Report86Foundations for our corporate value

Customer protection management
We give first priority to our customers, and we believe that earning their trust is the basis for ensuring sound management andtherefore earning the trust of other stakeholders as well. With this in mind, a core part of our compliance is to continuously seek
to monitor and improve the operations of the group from the perspective of what is in the best interests of our customers in orderto ensure that our operations are appropriate and to improve customer convenience. We manage customer protection uniformly
throughout the group in order to achieve this objective.

Customer protection management structure

Our President & Group CEO generally oversees the managementof customer protection, and also heads the Compliance Committee
in which related important matters are discussed. At our coregroup companies, the division responsible for each area ofmanagement described above also provides centralized monitoringand implementation of customer protection management. Core
group companies oversee customer protection management attheir own subsidiaries.

87

Supervision/audit

1. Ensuring the appropriateness and sufficiency of explanations
provided to customers prior to conducting transactions,purchasing products, etc. as well as the provision of information(e.g. product explanations) to customers.
2. Ensuring the appropriateness and sufficiency of the handlingof customer inquiries, complaints, and other communications(customer service).
3. Ensuring the appropriateness of the management of customer
information (customer information management).
4. Ensuring the appropriateness of customer interaction andthe handling of customer information in cases where group
operations are outsourced (outsourcing management).
5. Ensuring the appropriateness of the management of measures
to be taken in order to address conflicts of interest arising fromtransactions with customers (conflict of interest management).

Mizuho Financial GroupManagement

At Mizuho, customer protection management refers to of theefforts we make to improve the protection of our customers andimprove customer convenience from the following perspectives:

Board of Directors

Audit Committee

President & Group CEO

Executive Management
Committee
Compliance Committee(Chairman: President & Group CEO)

Officers responsible for the general management of customer protection(Department in charge: Compliance Department)

Divisions in charge

Customer protection management

Explanation of products

Outsourcing management

Customer service management

Conflict of interest management

Core group companies (e.g. MHBK, MHTB, and MHSC)

Subsidiaries of the above group companies

Information management

Customer service management

As advances have been made in information technology,
the potential uses for data have expanded, but at the sametime, cyberattacks have risen in number. This has led tocloser public scrutiny of the methods companies use toprotect personal information. As a financial services provider
operating globally, Mizuho is aware of the vital importanceof managing information in a way that ensures appropriate
protection and use of information assets. We are constantly
working to strengthen our information management practices.
For example, we aim to ensure that our management systems
for information assets, security management measures, andinformation administration methods are clear and straightforward.
Also, we implement training and awareness-building exercises toensure that each and every employee has a firm understanding
regarding the proper protection of information assets.

At Mizuho, we engage in business with a wide range ofcustomers, and we put a strong emphasis on responding
appropriately to feedback, complaints, or other communicationfrom customers in addition to our efforts to offer customers
stronger protections and higher convenience.
In the case of receiving a complaint or other critical feedback,
we not only emphasize the importance of responding quickly
and politely, but also require reports to be drawn up in order tomonitor these situations.
Furthermore, we regard all customer feedback as an important
asset and work continuously to improve our operations andprevent the recurrence of issues with the aim of increasing
customer satisfaction.
For more information on Mizuho’s customer protection measures, pleasesee our website:
https://www.mizuho-fg.com/company/internal/customer/

Mizuho Financial GroupFoundations for our corporate value

Fiduciary duties**F iduciary duties is a general term for the broad range ofvarious roles and responsibilities that fiduciaries are
expected to fulfill when engaging in certain businessactivities in order to live up to the trust that is placed inthem by their customers.

Mizuho’s Corporate Identity includes our central values—the Mizuho Values—starting with putting our customers first, and these values
are shared by everyone at Mizuho. As a team of financial professionals providing a broad range of financial services, we are committed toproviding the best, most appropriate solutions in response to our customers’ diverse needs.
As a long-term partner providing optimal products and services that are in our customers’ best interests, and in seeking to continue to be
our customers’ most trusted financial services group in respect to our asset management–related business, Mizuho has established anddisclosed our group-wide Policies Regarding Mizuho’s Fiduciary Duties*. In addition, at the holding company and relevant groupcompanies, we have established and made public specific action plans for ensuring we are always aligned with customers’ best interests.

Our commitment to performing our fiduciary duties leads to the creation of shared value with our customers
Through the performance of our fiduciary duties, we endeavor
to grow customers’ financial assets over the medium-to-longterm and to ensure a high degree of customer satisfaction andtrust.

This level of customer satisfaction and trust enables us toexpand our business base and strengthen our brand, paving
the way for our medium- to long-term growth. In this way, we
are aiming to create shared value with our customers.

Creating shared value with our customers
Performing our fiduciary duties

Positive and trustworthy public image

MizuhoCustomers

Results
MizuhoIncrease in financial assets over the medium-to-long term

Medium- to long-term growth

Creating
shared value

Providing optimal financial products and services
Pursuing what is in our customers’ best interests
Enhancing customer satisfaction and trust

Expanding customer baseStrengthening our brand

Key Performance Indicators (KPIs)
In addition, with the objective of creating shared value with ourcustomers, we have established KPIs to confirm our level of

Policies

1. Performing our fiduciary duties

Group management policies‌Number of participants in financial
education courses

performance of our fiduciary duties, and we announce them
periodically along with the status of initiatives under our Action Plan.

2. Positive and trustworthy public image‌Number of certified personnel‌Customer satisfaction survey‌Balance of assets under management—Increase in assets under management
due to new investors‌Number of customers using our investment products—Number of customers using our long-term
investment focused products‌Number of products developed or improved‌Number of companies involved in our
engagement activities‌Total number of seminar attendees‌Number of fund awards‌Survey of satisfaction among
investment trust companies‌Balance of pension trust assets‌Balance of funds in publicly offered andprivately placed investment trusts‌Balance of funds invested in DC specialized
funds and long-term investment focused funds

Policies by function

Sales
Mizuho Bank
Mizuho Trust & Banking
Mizuho Securities

Asset management and product development

Mizuho Trust & Banking
Mizuho Securities
Asset Management One

Asset administration
Mizuho Trust & Banking
Trust & Custody Services Bank

3. Results‌Number of improvements madeto back office operations‌Number of training sessions‌Balance of funds in new publicly
offered investment trusts‌Balance of assets under management

2018 Integrated Report88Foundations for our corporate value

IT strategy

IT systems are crucial to financial institutions’ management and business strategies, and highquality IT strategies are key means of differentiation and establishing competitive advantage.

 Declaration of Cybersecurity

We aim to have strong IT systems in place that are efficient and stable and which support our One
Mizuho strategy. We will continue to develop IT systems that draw on the group’s full capabilities
as a means of establishing competitive advantage and meeting customer needs, as well as
responding to advances in digital technology, tighter financial regulations, and other trends, while
also providing global IT services in an integrated manner among our banking, trust banking andsecurities entities. To do this, we are promoting IT system transformation and group-wide data
management and cyber security, as we also continue to strengthen IT governance.

Managementhttps://www.mizuho-fg.
com/company/strategy/it/
cybersecurrity/index.html

IT system transformation Selected as Competitive IT
Strategy Company 2018 (forthe third consecutive year)

In view of the overwhelming advances intechnology and recent changes in the internaland external environments, we are seeking totransform our IT systems and IT operations
as one aspect of our fundamental structuralreforms. Specifically, we are proceeding withstructural improvements by integrating andcentralizing systems and using the cloud.
We are also replacing legacy IT systems with
next-generation IT systems. Moreover, we
are using digital technologies such as AI and
RPA to improve productivity in the systemdevelopment process and enhance theefficiency of operations and administration.

IT system transformation timeline
Apr. 2002Merger ofpredecessor banks

Dec. 2004

Apr. 2010 toMar. 2013

Integrationof systems

Apr. 2013-

Mizuho’s Transformation
ProgramThorough system risk management/
system quality management for
stable system operation

Apr. 2016-

Previous medium-termbusiness plan

Current medium-termbusiness plan

Integrated System

Improvement of system risk assessment
Improvement of response capabilities to cyberattacks

Further improvesystem security

Upgrade services and functions
Common infrastructure
Cost reduction

Improvefunctions

Next-generation IT system
Introduce hub &spoke system

Integrate legacy
systems

Strategic
rebuilding

and stability
Replace IT legacy
systems

Rebuild peripheral
IT systems instagesIntroduce common
IT business platform

Offer innovative

Enhance infrastructure
Private cloud

financial services
Public cloudHybrid cloud

Improve productivity in IT development
High-speed development tools
RPA¹, AI, etc.

Alliances with outside
partners
API2, ASP3, etc.

1. Robotic Process Automation
2. Application Programming Interface
3. Application Service Provider

89

Mizuho Financial Group

Increasing efficiencyof IT operations
RPA1

Use of digitaltechnology
Open innovation

Strengthen
cost competitivenessFoundations for our corporate value IT strategy

External organization

Integrated
SOC

Gather information/implement
countermeasures/investigate
Multilayer defense systems! Attacker

Targeted cyberattack
Website alteration
DDoS attack
Hacking
Illegal money transfer

Forensics

Rescue/support

Monitor/respondProtect

To ensure that our customers feel secure when using our financial
services and to fulfill our duty to contribute to the stable operationand sustainable development of the financial infrastructure, wehave positioned cyberattacks as one of our top management risks
and have prepared cyber security strategies under the supervisionof senior management. With Mizuho-CIRT1 taking the lead, we haveassigned high-level professionals and are drawing on intelligenceand cutting-edge technology developed in collaboration withexternal specialist organizations, while we are also taking
initiatives to strengthen our resilience capabilities. These include
monitoring via integrated SOC2, analyzing computer viruses,
developing multilayer defense systems, and other measures. Also,
we are placing emphasis on employee training with a view to themedium- to long-term needs of the organization.

Mizuho-CIRT

Collaborate

Cyber security

Assets/services to be protected

Information assets
Customer information

1. Cyber Incident Response Team
2. Security Operation Center
Coordination
Socialmedia

Data management

Internet

As data management for data collection and analysis to be
used in management and business becomes more importantto respond to global financial regulations and sophistication of
MIS3, we have prepared a database to centralize management ofcollected and analyzed data relating to risks and profits, etc. In
addition, with the aim of using big data for more sophisticatedmarketing, we are promoting the development of a data analysis
platform that can process large volumes of data at high speeds.
3. Management Information System

Creditcard

Mizuho’s customers
OnlinebankingBank,
Branches trust bank,securities

Bank
ATMs

Treasury systems

Callcenters

WebsiteTrust bank Securities

Accounting systems

Information systems

Data analysis platform

Corporate information database

Marketing data

Risk/revenue data

Improve marketing using Appropriately respond to
big data
global financial regulations

Upgrade corporate
dashboard/MIS

Migration to the next-generation IT system• Downsize and streamline the IT systems• Improve response to potential system failures

Existing systems

MHBK legacy banking system

Independent components by business and function• Improve flexibility through a simplified structure• Enable flexible adaptation to new services• Shorten the lead time and reduce costs for new
development

Cutting-edge next-generation core banking systems•S trengthen infrastructure for providing services• Improve operations processing speed

Outline of the next-generation IT system

Mizuho BankMHCB legacy banking system

Mizuho Trust & Banking
System platform for banking businessInformation manage- Core banking
Customer channels
ment systems
systemIntegration of legacy core banking systems from
MHBK, MHCB, and MHTB

IT system integration

One of the most advanced bank IT systems in JapanThe next-generation IT system will replace Mizuho’s current three core banking systems, allowing us to downsize and streamline ourIT systems. Also, developing independent components by business and function will enable flexible adaption to new services andshorten the lead time and reduce costs for new development. By adopting a cutting-edge core banking system, we will strengthen our
infrastructure for providing services and improve operation processing speed. When we migrate to the next-generation IT system, we
will proceed with caution, placing emphasis on a stable and steady migration process.

Online banking

Branch terminals

Externally connected
systems

Common business platform (since FY2013)
Component systems
Deposits

Remittances

Credittransactions

ForeignexchangeTrustbusiness…

Core information management systems

2018 Integrated Report90Foundations for our corporate value

Corporate culture and employee engagement

Employee engagement
In order to realize the tenets of Mizuho’s Corporate Identity, we have established an HR Vision to encourage all employees to takeinitiative and develop themselves.
HR Vision
Mizuho Financial Group firmly believes that the personal development of individual employees contributes to the stable andsustainable growth of Mizuho as a whole.
Mizuho recognizes those employees who make an effort to put the Mizuho Values into practice and helps employees to createa more fulfilling life through their work.
 izuho encourages employees to utilize their strengths, and provides opportunities for them to use their skills and toMdevelop their abilities.
Mizuho encourages employees who differ in terms of gender, country of origin, cultural background, and values tounderstand, respect, and inspire each other.
Mizuho works with its employees to create a corporate culture that encourages people to be passionate about and to takepride in their work.
One of the basic policies in our medium-term business plan is to “embed a corporate culture that encourages the active participationof our workforce to support a stronger Mizuho”. With this in mind, we are working towards achieving a competitive advantage forMizuho in terms of our workforce by implementing fundamental reforms in HR management.

Fundamental reforms in HR management
Our fundamental reforms in HR management are aimed atenabling us to continually enhance employee engagement,
ensuring that all employees can achieve continual growth,reach their full potential, and enjoy long and fulfilling careers
at Mizuho. As we implement each of the key strategies underthese reforms, we are seeking to move away from traditional“one-size-fits-all” HR management and the inflexible promotion
system based on the year one joined the company. Our focus
is on drawing out the capabilities of each individual andmotivating them to reach their full potential.

In order to clearly communicate to all employees and executive
officers the principles that will be applied to Mizuho’s HR
strategies, HR systems, and HR management, we established“Mizuho’s HR Policy”. Additionally, we released a “Diversity andInclusion Statement” to affirm our commitment to promoting
the professional growth and active participation of our diverse
workforce. Both of these documents have also been madepublically available.

Mizuho’s HR strategies and employee satisfaction

Key strategies
1. HR management that respects employees’ individuality
Development-focused HR management aimed atenhancing employees’ strengths
Multi-track HR management that responds to thecareer goals of a diverse workforce
Promoting the health and wellbeing of employees
and maintaining a healthy work environment
2. Strategic employee rotation
3. Development of future executive leaders
4. Globalization of Mizuho’s talent and HR management
5. Promotion of diversity and inclusion

Primary initiatives in fiscal 2017
We have continued to implement and enhance a number of
initiatives for promoting HR management which respects
employees’ individuality (development-focused HR management),
future leader development programs, strategic development offemale employees, and diversity and inclusion. Additionally, fromfiscal 2017 we have enhanced our efforts to provide multi-track

91

Mizuho Financial Group

Employee satisfaction1
Revisionsto the HR Vision

3.43
3.46

FY2013

Voluntary employee turnover rate (%)2

Mizuho’s HR strategies

Revisions to the HR system(flexible work arrangements and expanded
support for employees who are caregivers)

Fundamental reforms
in HR management

3.67

3.71

3.71

3.59
2.98

FY20142.71

FY20152.52
FY20162.74

FY2017

1. Average response on a scale from 1 to 5 in the category of “satisfaction withthe company” on the annual Staff Survey.
2. From fiscal 2017 the calculation method has been changed—results from past
years are calculated using this new method retroactively.

HR management, for example by providing more opportunities
for employees on fixed-term contracts. We have also promoted
the globalization of our talent and HR management, accelerated
initiatives under the Japanese government’s “Work Style
Reforms” such as remote work options, and strengthened
employee health and wellness management.

Foundations for our corporate value Corporate culture and employee engagement

Talent development

Strategic job rotation
Through job rotations across in-housecompanies, units, and entities we develop
employees strategically in line with both theirindividual career aspirations and their potential
to lead our business strategies.

In-house company/unit/entity

In-house company/unit/entity
Group-wide strategic rotation
In-house company/unit/entity

Development of future executive leadersHigh potential employees are identified andselected from a diverse pool of candidates
on a group-wide and global basis, and theirleadership capabilities (what we categorize
as “ability to initiate”, “ability to achieve”, and“integrity”) are strategically developed throughexecutive leader development programs. We
seek to cultivate leaders who can define andarticulate Mizuho’s future vision and direction,
corporate identity, and strategies; and who candrive growth and change, without being boundby precedent; and who do not give up when
faced with a variety of difficulties or crises, butinstead tackle them head-on and mitigate risk
and damage to the organization.

	
Number of seminar participants

70,730 participants(+821 year-on-year)

A development seminar

Overview of Mizuho’s Executive Leader
Development Program
1st cycle

2nd cycle

Work style reforms (FY2017)
3rd cycle

Deputy general manager andGeneraljoint general manager level manager level

Stretch job assignments
Leadership training programs
Assessment & feedback
Coaching by external specialists
The candidate pool is not fixed.
Candidates may be replaced or added
based on periodical assessment.

	Remote work system users

Adopting Japan’s Work Style Reforms
By encouraging the use of more flexible work
arrangements such as flextime and staggered
working hours, we were able to reduce
overtime work hours by 10% over the past two
years (compared to fiscal 2015). Additionally,
we are aiming to increase productivity byproviding more flexibility in terms of where
employees work. Around 1,300 employees areusing our remote work system, an increase of
1,000 compared to the previous fiscal year.

 rofessional development
Pseminars (FY2017)

Strategic rotations
Employees leading ourbusiness strategies

We will seek to bring out each diverse
individual’s potential through work experience
which is beneficial based on their inherent

qualities, evaluating employees based on thegrowth in their abilities rather than results
alone, ensuring that employees haveopportunities for dialogue with theirsupervisors regarding their career path andthat they receive sufficient feedback, providing
growth opportunities through job rotations
and professional development seminars, andensuring that promotions are not denied based
solely on an employee’s number of years at
the company or years of experience.

Next generation of executive
leadership R management that respects employees’H
individuality
We will transition to a more developmentfocused HR management which focuses on theinherent qualities of each individual anddevelops their strengths by encouraging themto proactively take on challenges.

Around 1,300(+1,000 year-on-year)	Employees (those legally
subject to work hour
management) in any given
month who worked morethan 60 hours of overtime

1.7%(-1.2% year-on-year)
 taff Survey responsesS
related to work style reforms(average response on a scaleof 1 to 5)
Q1: I have a healthy balance
between my work and mypersonal/family life.

We are also focusing on initiatives foreliminating overwork, and as a result thepercentage of employees in any given month
who worked more than 60 hours of overtime
decreased from 2.9% to 1.7% (annualized)
compared to the previous fiscal year. Also, we
are working with industrial physicians todevelop more detailed labor management
practices.

Q2: Mizuho’s work
environment enables
diverse and flexible work
arrangements.

3.86
3.69

FY2016

3.94
3.77

FY20172018 Integrated Report92Foundations for our corporate value

Promoting employee health and wellness
Mizuho was selectedunder the 2018
Health & Productivity Stock
Selection, which is jointly
administered by the
Ministry of Economy, Trade andIndustry and the Tokyo Stock
Exchange.

By promoting employee health and wellness,
we are aiming to enhance the performance ofeach individual and increase the productivityof the organization as a whole. We are working
to cultivate a healthy work environment and topromote employee awareness regarding
health, for example by providing subsidies thatencourage employees to undergo preventative

health checks. In fiscal 2017, 99% of employees
took an annual medical exam and 94% took astress assessment. Additionally, Mizuho wasrecognized under the 2018 Health &Productivity Stock Selection based on having
put in place a number of strategies, including
those aimed at reducing overtime work andpreventing and controlling lifestyle diseases.

Diversity and inclusion
Numerical targets (MHFG, MHBK, MHTB, and MHSC)
In recognition of our efforts
to promote women’s
empowerment in the workplace,
Mizuho received Nadeshiko
Brand designation for fiscal
2017, conferred jointly by the
Tokyo Stock Exchange andJapan’s Ministry of Economy,
Trade and Industry.

Area
OutsideJapan(MizuhoBank)

Japan*

Initial target

Percentage of management positions filled by employees hired
outside Japan
Percentage of management positions filled by women
General manager equivalent
Percentage of management
Manager equivalent and above
positions filled by womenSupervisor equivalent and above
Percentage of new graduates hired for management track jobs
who are female
Percentage of paid annual leave taken by employees
Percentage of eligible male employees who take childcare leave
Percentage of employees who are individuals with disabilities

Numerical
target (to beachieved by)Current

33%

43%

7% July
3% 201610%22%
FY201634%
intake64%
FY2015
1.5%
March
2.2%
2016

9%

FY201750%

10% July5%
10% 2019
July
15%
20%
2018
27%
30%
FY2019FY201830%
36%
intakeintake73%
70%
FY2017FY2018
79%
100%
June
March
2.3%
2.2%
2019
2018

*total for the above noted 4 companies

Mizuho received Platinum
Kurumin certification inrecognition of our significant
efforts to implement andmaintain systems that assist
workers in balancing work andchildcare.

We aim to proactively incorporate the ideas
and opinions of our diverse workforce into oureveryday work, strategic planning, anddecision-making in order to create new value
and innovations. We are committed to valuing
the voices of women, non-Japanese nationals,
individuals with disabilities, individuals who

identify as LGBT, employees who are balancing
childcare or aging family member care with
their work, and other diverse groups. We arepromoting diversity and inclusion in order toensure that each employee can feel motivatedand proud to be working at Mizuho and enjoy
long and fulfilling careers.

Promoting women’s empowerment in the workplace
In order to better support women’s careerdeveloping women leaders by providing
advancement, we are strengthening andstrategic assignments and professional growth
expanding our strategic development
opportunities from the early stages of theirprograms and putting a particular focus on
careers.
Strategic development programs for female employees
Mizuho was recognized on
the 2018 Bloomberg Financial
Services Gender-Equality Index.

General manager
equivalent

Cultivate an executive management
perspective in prospective
candidates for the Executive Leader
Development Program

Strategic assignments
Coaching

Managerequivalent

Aim to accelerate professional
growth by transforming participants’mindsets regarding their careers

 areer development support
Cseminars

While cultivating their career
perspective, enhance eachindividual’s strengthens throughevaluations and assignments

 R management tailored to theHindividual (including transforming management mindsets)
Meetings with female careeradvisors

M-WIN
A network forSupervisor
equivalentMizuho received the top ratingof “Gold” on the PRIDE Index
which evaluates LGBT-related
initiatives.

93

Mizuho Financial Group(under Supervisor
equivalent)Company-led initiatives

women working
at Mizuho

Network expansion
Access to rolemodelsEmployee-led
initiatives

Foundations for our corporate value Corporate culture and employee engagement

Connectivity and employee resource groups (ERGs)
ERGs enable employees to connect across organizational,
national, gender, and cultural boundaries and to collaborate
while maintaining a strong sense of mutual trust and respect.
This results in the sharing of knowledge and experience as wellas increased motivation, which in turn leads to opportunities
for each individual to achieve professional growth as well as
encourages new ideas and discoveries which benefit ourbusiness.

Key ERGs at Mizuho
Mizuho Women’s Initiatives Network (M-WIN)
Mizuho LGBT+ & Ally Network (M-LAN)
Mizuho Global Communication & Connectivity Club (MGCC)
Collaboration, Creation, Relation, Evolution (CocreA)
A network whose mission is to effect change within Mizuho
through co-creation using technology.

Globalization of Mizuho’s talent and HR management
Mizuho’s business strategies are increasingly global in natureand therefore we are focused on developing global talent andensuring the right person is in the right position on a global
basis by standardizing HR management for all employees
regardless of which country they were hired in. In particular weare aiming to accelerate the development and promotion to
management roles of employees hired outside Japan as wellas provide more opportunities for Japanese employees to gaininternational experience.

Our HR strategy
Mizuho aims to continuously increase employee engagement, and our HR management isdesigned to encourage employees to exercise their abilities to their maximum potential,
and to continuously expand their capabilities and expertise and enjoy long and fulfilling
careers at Mizuho. By ensuring that there are no barriers to advancement and providing
equal opportunities to all employees regardless of characteristics such as nationality,
ethnicity, gender, or values, employees are motivated to both advance their own careersand contribute to the organization.
As part of the fundamental reforms in HR management which we have introduced, we areaiming to transition away from a “one-size-fits-all” style of HR management and eliminate
outdated practices and unwritten rules. Our objective is to implement development-focused
HR management which respects employees’ individuality and to promote diversity andinclusion as a means of achieving higher engagement in our diverse workforce, particularly
for demographics underrepresented in leadership such as non-Japanese nationals andwomen. We are also strengthening our employee health management which is key toensuring that employees can enjoy long and fulfilling careers at Mizuho.

Shuji Kojima
Group Chief Human
Resources Officer

Approach to structural reforms
In addition to our goals of strengthening our workforce’s capabilities as part of the fundamental reforms in HR management, weare also working towards achieving the optimal staffing levels outlined in the structural reforms and therefore, maximizing eachindividual’s productivity is key.
To optimize staffing levels, we will slim-down our workforce in areas where technology and increased operational efficiency has
reduced the workload, shift personnel from back office and corporate positions to the front office, and enhance the capabilitiesof our workforce through professional development and by acquiring talent with the skills required for developing new businessfields. These steps will enable us to achieve an optimal talent portfolio.
In order to achieve this, we are fundamentally revising our strategies concerning hiring, development, and long-term employment.
In terms of hiring, we will focus on acquiring people with creative thinking and problem-solving skills. Additionally we will
strengthen our efforts to acquire talent from STEM backgrounds as well as non-Japanese nationals with the aim of achieving
the objectives under the structural reforms related to technology, open innovation, and globalization. As for development, in
addition to strengthening all employees’ digital literacy, we are encouraging a change in mindsets and a willingness to seek selftransformation, and aiming to facilitate the shift of personnel to front office positions by providing opportunities for employees
to develop the required skillsets. We are also expanding opportunities for retraining and offering other recurrent education as ameans of supporting long-term employment.

2018 Integrated Report94Foundations for our corporate value

Embedding a strong corporate culture
One of the 10 Basic Strategies set in Mizuho’s medium-term business plan calls for continued initiatives toward embedding a
corporate culture to support the creation of a stronger organization.

Basic approach
We are working to embed a robust corporate culture, which isindispensable for building a strong organization to realize ouraim of being a financial services consulting group.
Our corporate culture is cultivated through the actions of eachand every employee based on their awareness of the Mizuho
Values. With the One Mizuho Promotion Project Team taking
the lead, we are working to encourage the development of ashared understanding of the Mizuho Corporate Identity andour medium-term business plan among all members of thegroup. Specific activities include strengthening our initiatives
at the departmental and branch levels aimed at having eachand every employee put the Mizuho Values into practice andpromoting stronger internal communication.

Corporate Philosophy
Mizuho’s fundamental approachto business activities, based on
the raison d’être of Mizuho

Mizuho’s
Corporate
Identity

VisionMizuho’s vision for the future,
realized through the practice of
the Corporate Philosophy

Mizuho Values
The shared values and principles
of Mizuho’s people, uniting
all executives and employees
together to pursue our Vision

Common culture throughout the group

Putting the Mizuho Values into practice

Promoting stronger internal communication

All Mizuho offices around the world hold One Mizuho Day atsome point in the year to discuss the initiatives they should
implement to achieve their individual office visions. Other
ways in which we promote dialog are off-site meetings forgeneral managers and executive officer visits to branches
or departments. These visits are held in a roundtable format
and enable direct discussions between employees and senior
management, which leads to a greater sense of unity andhigher motivation.

We have put in place a number of initiatives for encouraging
communication among employees and fostering a senseof unity. For example, special events exclusively for group
employees, the One Mizuho Culture Prize awarded to those
who put the Mizuho Values into practice in an outstanding
way, and a system for sending thank you cards to other
employees which is easily accessible on company tablets andsmartphones.

Thank you card logo
One Mizuho Culture Prize
trophy95

Mizuho Financial GroupFoundations for our corporate value

Compliance with international financial regulations

Globaldevelopments

The Basel Accords, an international regulatory framework for ensuring the soundness of banking institutions, were first created in1988 (and now referred to as Basel I). As the financial services industry has developed, this framework has seen new iterations. At
the time of the financial crisis in 2008, new issues related to the stability of the financial system became evident. In response, in
2010, capital ratio requirements were tightened in both quantitative and qualitative terms, and a new framework (Basel III) wasannounced that included restrictions on financial leverage and liquidity requirements. Since 2013, regulations based on these
additional rules have gradually come into effect. After discussions regarding banking regulations, in December 2017, an agreement
was reached regarding Basel III, mainly related to revision of risk asset calculation, bringing to an end certain regulatory reforms
following the financial crisis.

1982 Latin American
debt crisis

Increase in trading
activity

2008 Global Financial Crisis

More sophisticated risk
management systems

1988
Basel
regulations

Increasing diversity andcomplexity of financial systems

Basel I
Introduction of thefirst capital ratio(numerator =shareholders’ equity;
denominator = credit
risk assets)

1996
Basel I
 arket riskM
incorporated into risk
asset calculation

2004

2009

2010

2017

Basel II

Basel 2.5

Final agreement on Basel III

 se of banks’ internalU
credit ratings in risk asset
calculation
Operational risk
incorporated into risk
asset calculation

 ightening of regulations onTsecuritized products, increased
capital ratio

 eview and revision ofRrisk asset calculation(denominator of the capitalratio)

Basel III tronger qualitative and quantitative regulations on capital /Sshareholders’ equity (numerator of the capital ratio)
Introduction of leverage ratio restrictions and liquidity restrictions

Principal restrictions under Basel III and state of compliance
Capital ratio
This rule requires that the ratio of capital to risk assets (which
are calculated by taking account of risks) must be maintained
above a specified level. Since Mizuho Financial Group isdesignated as a G-SIB*, it must maintain a relatively higher
capital ratio. With the finalization of the Basel III framework, theLeverage ratio
This rule will require that the ratio of capital to risk exposure(calculated without regard for the risk of assets held) must be
maintained above a specified level. This ratio is positioned as amethod for calculating risk assets has been reviewed andrevised, and the required ratio will be increased in stages
between 2022 and 2027.
*Global Systemically Important Bank

supplementary requirement to the risk-based capital ratio.
Mizuho, as a G-SIB, will be required to meet a relatively higher
leverage ratio.

Liquidity
The liquidity rules specify both a liquidity coverage ratio and astable funding ratio. For the liquidity coverage ratio, banks are
required to hold a high-quality portfolio of liquid assets thatexceeds the estimated amount of funds that would flow out
under severe stress conditions over a specified short-term
period (30 days). This rule will be phased in, and 100%

compliance will be required from 2019. For the stable funding
ratio, banks are required to secure stable coverage of theirlong-term assets and to curb inconsistencies between fundprocurement and fund management structures. The minimum
coverage will be 100% from the time this rule is imposed.

Mizuho Financial Group maintains all of these ratios at
sufficient levels. We are also responding to these regulations bysteadily increasing our accumulation of capital and practicing
proper balance sheet control.

Future trends and compliance requirements
Under the current schedule, compliance with the final
agreement on Basel III will be required beginning in 2022,
after Basel Committee member countries have considered
their own domestic regulations. Based on confirmation of thecontent of the regulations, we are moving steadily forwardwith putting the necessary internal systems in place. To
ensure fairness in international competition, it is importantthat the Basel regulations are introduced in a manner that

ensures consistency of the content and the timing of theintroduction. Moreover, it will be necessary to verify that therequirements introduced so far will not have an adverse
impact on real economies and liquidity in financial markets,and it may be necessary to make adjustments. Regardingthese points, we at Mizuho will continue to express our views
and make contributions at home and abroad.

2018 Integrated Report96Foundations for our corporate value

Stakeholder communication

In addition to articulating our commitment to maintain an ethical stance towards our stakeholders within the Mizuho Code of
Conduct, we aim to communicate with our stakeholders proactively and we strive to ensure that our corporate activities are alignedwith social expectations as well as fair and transparent.

Our stakeholders
We communicate with our broad base of stakeholders using a wide range of communication tools and channels and aim to reflect
their opinions and ideas into our corporate activities.
Stakeholders

Customers

Customers

Government
authorities

Shareholders

MizuhoRegional/local
communities

Customer feedback cards, customer satisfaction
surveys, call centers, and our website customer
feedback forms for gathering opinions or complaints


P97

Shareholders

General shareholders’ meetings,
investor briefings

P29

Employees

Employee opinion surveys, formal discussions between
employee representatives and management
P91

Regional/local
communities

Suppliers/
competitors

Employees

Principal communication channels

Social contribution activities, support for
financial education 
https://www.mizuho-fg.co.jp/csr/

Suppliers/
competitors

Purchasing activities and outsourcing
contracts overnmentGauthorities

Policy recommendations, participation in industry groups,
appropriate responses to supervisory authorities

A closer look at our communication with customers
In our Vision, we at Mizuho have adopted a goal of being our customers’ best financial services provider and we have put a numberof initiatives in place in order to achieve this objective. Using a range of communication channels, we actively stay abreast of theconstantly changing needs of our customers and strive to improve the level of services that we can offer.
Customer satisfaction improvement cycle

Providing attractive products
and services
Providing recommendations andinformation promptly
Consulting services which draw
on our advanced expertiseEnhancement of our solution functions

Customers

Customer feedback systems
Identification of each customer’s
needs and expectations

Customer feedback cards
Call centers
Customer satisfaction surveys

Group companies

Mizuho Financial Group (holding company)
Increase customer satisfaction (CS) awareness throughout the Group
Construction of a group-wide CS promotion system

97

Mizuho Financial Group

Application of common CS improvement tools across the group

Enhancement of CS education and training

Foundations for our corporate value Stakeholder communication

Systems to capture customer feedback
Customer feedback cards
Customer feedback cards are distributed and otherwise madeavailable in retail branches. We have also installed “customer
feedback boards” where cards which have been submitted are
displayed along with the branch’s response.

Satisfaction surveys
We regularly conduct satisfaction surveys targeting ourindividual and corporate customers globally. The results ofthese surveys are reported directly to management and used
to improve our products and services.

Call centers
Our call centers are available for responding to customer
opinions and requests and data collected from these centers is
a valuable resource. In fiscal 2016, we received approximately
2.33 million phone inquiries for Mizuho Bank, Mizuho Trust &Banking, and Mizuho Securities combined.

Website feedback forms
The feedback forms available on our website are anothermethod we use to field comments and requests directed atMizuho Bank, Mizuho Trust & Banking, and Mizuho Securities.

Reflecting customer feedback into
our corporate activities
At Mizuho Bank, we draw on the opinions
expressed by customers in discussions held by ourCustomer Satisfaction and Protection Promotion
Committees within our branches, as well as atmanagement level meetings, including those of the
Executive Management Committee. When we havemade improvements based on customer feedback,
we post this information on our Customer Feedback
Boards located in our branches.

Customer feedback
For matters thatcannot be addressed
immediately, we
devise and implement
improvement plans on
a group-wide basis.

At the branch level, we
respond when we canimmediately, andannounce results on the
Customer Feedback Boardand other locations.

Customer opinions, requests,
complaints and other feedback
received at our branches or via
other channels such as surveys
and our website.

Branches: Customer Satisfaction and Protection Promotion Committees
Head Office: Executive Management Committee and other venues

2018 Integrated Report98Financial review

Six-year major financial data (FY2012-2017)

Summary of consolidated performance(¥ billion)
FY2012FY2013

FY2014FY2015FY2016

Consolidated gross profits

2,171.7

2,035.2

2,247.7

2,221.6

2,092.7

1,915.3

Net interest income

1,075.8

1,108.3

1,129.4

1,003.6

867.8

807.3

Fiduciary income

48.5

52.0

52.6

53.4

50.6

55.4

Credit costs for trust accounts

—

—

—

—

—

—

Net fee and commission income

507.3

560.7

593.3

607.5

603.5

614.3

Net trading income

215.0

187.4

262.9

310.5

325.3

275.7

Net other operating income

324.8

126.7

209.3

246.4

245.4

162.4

(1,244.6)(1,258.2)(1,351.6)(1,349.5)(1,467.2)(1,488.9)

Consolidated net business profits*

912.1

744.2

876.9

852.8

663.4

457.8

Credit-related costs(111.8)

112.8

(4.6)

(30.4)(47.5)

156.3

Aggregate figures for the 2 banks(114.1)

116.6

(7.8)

(26.7)(49.3)

153.2

Net gains (losses) related to stocks(82.9)

77.0

131.9

205.6

242.1

272.0

46.6

81.5

143.7

225.3

261.1

288.3

(125.8)

(5.3)

(5.3)

(10.3)

(4.8)

(5.1)

(11.1)

15.4

15.0

24.2

18.8

21.4

General and administrative expenses

Net gains (losses) on sales of stocks
Losses on impairment (devaluation) of stocks
Equity in income from investment in affiliates

FY2017

Other

29.2

5.1

(27.5)(74.0)(101.5)(93.7)

Ordinary profits

750.3

987.5

1,010.8

997.5

737.5

782.4

Net extraordinary gains (losses)(32.5)(2.2)(20.2)

10.7

46.6

17.5

Income taxes – current(50.4)(137.0)(260.2)(213.2)(196.5)(190.1)– deferred
Profit(7.4)(77.9)(44.7)(69.2)

58.8

(1.4)

659.9

770.3

685.6

725.7

646.4

608.3

Profit attributable to non-controlling interests(99.4)(81.9)(73.7)(54.7)(42.9)(31.7)

Profit attributable to owners of parent

560.5

688.4

611.9

670.9

603.5

576.5

*Consolidated gross profits – G&A expenses (excluding non-recurring losses) + Equity in income from investments in affiliates and certain other consolidation adjustments

Summary of consolidated balance sheet

Assets(¥ billion)
FY2012FY2013

FY2014FY2015FY2016FY2017

177,411.0

175,822.8

189,684.7

193,458.5

200,508.6

205,028.3

Loans and bills discounted

67,536.8

69,301.4

73,415.1

73,708.8

78,337.7

79,421.4

Securities

53,472.3

43,997.5

43,278.7

39,505.9

32,353.1

34,183.0

Liabilities

169,674.8

167,518.3

179,884.2

184,105.3

191,235.2

195,207.0

Deposits

84,241.9

89,055.5

97,757.5

105,629.0

120,045.2

125,081.2

Negotiable certificates of deposit

15,326.7

12,755.7

15,694.9

11,827.5

10,631.2

11,382.5

7,736.2

8,304.5

9,800.5

9,353.2

9,273.3

9,821.2

Total shareholders’ equity

5,174.6

5,676.2

6,131.1

6,559.9

7,001.2

7,388.3

Retained earnings

1,814.7

2,315.6

2,769.3

3,197.6

3,615.4

4,002.8

752.5

781.0

2,029.9

1,607.8

1,520.9

1,677.5

1,806.4

1,844.0

1,635.5

1,182.6

749.3

754.2

FY2012FY2013

FY2014FY2015

Net assets

Total accumulated other comprehensive income
Non-controlling interests

Financial indicators

99(%)
FY2016FY2017

Common Equity Tier 1 capital ratio (consolidated)

8.16

8.80

9.43

10.50

11.34

12.49

Tier 1 capital ratio (consolidated)

11.03

11.35

11.50

12.64

13.30

15.44

Total capital ratio (consolidated)

14.19

14.36

14.58

15.41

16.28

18.24

Net assets per share (yen)229.70253.25322.86322.46335.96357.41

Profit attributable to owners of parent per share (yen)

22.96

28.18

24.91

26.94

23.86

22.72

Net return on equity (consolidated)

10.99

11.65

8.60

8.37

7.27

6.55

Mizuho Financial GroupFinancial review

Review and analysis for fiscal 2017

Financial and economic environment

GDP of major countries
US

EurozoneJapan

China

Reviewing the economic environment over the fiscal year ended
March 31, 2018, the global economy has continued on a path ofgradual recovery backed by factors such as the rally in the Chinese
economy, improvements related to the IT cycle, and improvements
in business confidence, predominately in major industrializedcountries.

8.0 (Annual % rate change from previous year)

In the United States, continued recovery has been underpinned by (i)continued strong consumer spending resulting from improvementsin the employment and income environment and wealth effects due
to a surge in stock prices and (ii) capital investment that began toincrease as a result of expectations over the Trump administration’s
tax reduction measures. Under such circumstances, the Federal
Reserve Board (FRB) pursued an exit strategy from monetary easing
whereby, among other measures, the FRB raised interest rates inJune 2017, September 2017, and March 2018 and began shrinking its
balance sheet in October 2017.

(4.0)

In Europe, despite downward pressure from the further appreciationof Euro, the economy has continued to recover, backed by thecontinued expansion of consumer spending due to an increase inemployment, in addition to the actualization of demand for capital
investments that had been put off due to political uncertainty
surrounding the presidential election in France. Given these
conditions, the European Central Bank (ECB), while leaving key
interest rates unchanged, determined in October 2017 to decrease
monthly asset purchases by half and steered itself in the direction of
pursuing an exit strategy from monetary easing.
In Asia, the Chinese economy remained strong, despite continued
sluggishness in capital investment due to tighter financial regulations
and policies to control real-estate speculation, supported by suchfactors as strong consumer spending and an expansion of exports,
which were backed by income growth and governmental policies tosupport the economy adopted in preparation for the National
Congress of the Communist Party of China in fall 2017. The
economies of emerging countries continued on a recovery trend,
due to such factors as the steadiness of China’s economy andexpansion of exports.
In Japan, the economy continued on a recovery trend, benefitingfrom overseas economic expansion and strong domestic demand.
Regarding domestic demand, the improvement of the inventory
cycle, the rise of capital investment related to the 2020 Tokyo
Olympic Games, and productivity improvements, as well as theimplementation of public investment in connection with Japan’s
economic stimulus measures, served to bolster growth. Consumer
spending has maintained its recovery due to the replacement of
durable goods and the effect of wage increases especially in small
and medium-sized enterprises. Under such circumstances, stock
prices trended upward and the exchange rate continued to trend
sideways; however, since February 2018, stock prices have entered acorrection phase with a stronger yen due to the rise in the long-term
interest rates in the United States and concerns regarding theprotectionist policies of the Trump administration. On the other hand,
long-term interest rates continued to remain low, at around 0%,
under the Bank of Japan’s “Quantitative and Qualitative Monetary
Easing with Yield Curve Control.”As for the future direction of the global economy, recovery is
expected to continue to be centered on the United States, but it
remains necessary to further monitor downward risks such as theUnited States’ governmental policies, political concerns in Europe,
the economic outlook for China, and heightening geopolitical risks.
As for the future direction of the Japanese economy, it is expected
to continue on its gradual recovery path, supported by the effects ofgovernment economic measures and growth in consumer spending
and capital investment. However, the potential impact of increasing
uncertainty in overseas economies on Japan requires monitoring.

(Annual % rate change from previous year) 8.0
7.8
7.6
7.4
7.2
7.0
6.8
6.6
6.4
6.2
6.0

6.0
4.0
2.0
0.0
(2.0)
(6.0)
(8.0)

2013

2014

2015

2016

2017

2018

(Source: Prepared by Mizuho Research Institute based on the data of Japan’s Cabinet
Office)Policy interest rate
Bank of Japan (BOJ) unsecured overnight call rate
European Central Bank Report

Federal funds rate

7.0 (%)
6.0
5.0
4.0
3.0
2.0
1.0
0.0
(1.0)

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

Note:
BOJ: After introduction of negative interest rates, interest rate applied to balancescarrying the policy interest rates(Source: Prepared by Mizuho Research Institute based on the data of Bloomberg)

Trends in stock prices
Nikkei Stock Price Average

US Dow Average

30,000 (Yen, US dollar)
25,00020,00015,00010,000
5,000

2013

2014

2015

2016

2017

2018

(Source: Prepared by Mizuho Research Institute based on the data of Bloomberg)©Nikkei

Trends in exchange rates
US dollar/YenEuro/US dollar

130 (Yen, US dollar)(Euro, US dollar) 1.5
1.4

120

1.3

110

1.2
100

1.1

90

1.0

80

0.9

2013

2014

2015

2016

2017

2018

(Source: Prepared by Mizuho Research Institute based on the data of Bloomberg)

2018 Integrated Report100Financial review

Summary of consolidated performance
Historical data

Consolidated gross profit
Consolidated net business profit1(¥ billion)
FY2008FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017

1,806.9

1,996.6

2,025.3

2,003.0

2,171.7

2,035.2

2,247.7

2,221.6

2,092.7

1,915.3

622.6

702.6

741.7

719.1

912.1

744.2

876.9

852.8

663.4

457.8

Net income (losses)2

484.5

413.2

239.4

560.5

688.4

611.9

670.9

603.5

576.5

(588.8)
1. Consolidated gross profits – G&A expenses (excluding non-recurring losses) + Equity in income from investments in affiliates and certain other consolidation adjustments
2. Profit attributable to owners of parent

Consolidated

Consolidated gross profits(¥ billion)
FY2017FY2016

Change from
FY2016

1,915.3

2,092.7(177.3)

Consolidated net business profits*

457.8

663.4

(205.5)Credit-related costs

156.3(47.5)

203.8

Net gains (losses) related to stocks

272.0

242.1

29.8

Ordinary profits

782.4

737.5

44.9

Profit attributable to owners of parent

576.5

603.5

(26.9)*Consolidated gross profits – G&A expenses (excluding non-recurring losses) +Equity in income from investments in affiliates and certain other consolidation
adjustments izuho Bank + Mizuho Trust & Banking*M(Aggregate figures on a non-consolidated basis)(¥ billion)

FY2017FY2016

Change from
FY2016Gross profits

1,293.3

1,441.4(148.1)

G&A expenses(excluding non-recurring losses)(964.7)(947.1)(17.6)Net business profits

328.5

494.3

(165.7)

Credit-related costs

153.2(49.3)

202.5

Net gains (losses) related to stocks

266.3

210.5

55.8

Ordinary profits

616.5

522.8

93.6

Net income

493.1

388.0

105.1

FY2016

Change from
FY2016*the Two Banks

Mizuho Securities (consolidated)
FY2017101(¥ billion)

Net operating revenues

306.0

365.9

SG&A expenses(263.4)(290.9)27.5

Ordinary income

43.2

75.8

(32.5)

Profit attributable to owners of parent

35.7

188.5

(152.8)Mizuho Financial Group(59.9)

Consolidated net business profits
We recorded consolidated gross profits of ¥1,915.3 billion for fiscal
2017, decreasing by ¥177.3 billion from the previous fiscal year.
Gross profits of the aggregate figures for Mizuho Bank and Mizuho
Trust & Banking (the Two Banks) on a non-consolidated basis
decreased by ¥148.1 billion on a year-on-year basis to ¥1,293.3
billion, reflecting the decline in income, etc., of market divisions
due mainly to internal and external conditions, etc.
General and administrative expenses of the Two Banks increasedby ¥17.6 billion on a year-on-year basis to ¥964.7 billion.
Net operating revenues of Mizuho Securities on a consolidated
basis decreased by ¥59.9 billion on a year-on-year basis to ¥306.0
billion in part due to a decline in the gain from trading and theimpact of a decrease in the number of consolidated subsidiaries
as a result of corporate restructuring in the group companies andother factors. SG&A expenses decreased by ¥27.5 billion on a
year-on-year basis to ¥263.4 billion. As a result, consolidated net
business profits decreased by ¥205.5 billion on a year-on-year basis
to ¥457.8 billion.

Profit attributable to owners of parent
Consolidated credit-related costs amounted to a gain on credit
recoveries of ¥156.3 billion.
Net gains (losses) related to stocks increased by ¥29.8 billion on a
year-on-year basis to ¥272.0 billion.
As a result, ordinary profits increased by ¥44.9 billion on a year-onyear basis to ¥782.4 billion.
Net extraordinary gains (losses) decreased by ¥29.1 billion on a
year-on-year basis to net gains of ¥17.5 billion due to reporting ofgains on the return from the cancellation of employee retirement
benefit trust on the one hand and the completion of special gains
accompanying group corporate realignments.
Income taxes increased by ¥53.8 billion on a year-on-year basis to¥191.6 billion.
As a result, profit attributable to owners of parent for FY2017
decreased by ¥26.9 billion on a year-on-year basis to ¥576.5 billion.
This result shows a 104% achievement against the earnings planfor FY2017 of ¥550.0 billion.

Financial review Review and analysis for fiscal 2017

Summary of consolidated balance sheet
Consolidated(¥ billion)
Change fromMarch 31,2017

March 31,2018

March 31,2017

205,028.3

200,508.6

4,519.6

34,183.0

32,353.1

1,829.8

Japanese government bonds

15,292.0

13,324.3

1,967.6

Japanese local government
bonds

239.3

284.4

(45.1)

Japanese corporate bonds
and short-term bonds

2,964.2

2,696.3

267.8

AssetsSecurities

Japanese stocks

3,952.7

3,958.4

(5.6)

Other

11,734.6

12,089.5(354.8)79,421.4

78,337.7

1,083.6

Loans and bills discounted
Loans(MHBK+MHTB, banking
account + trust account)

Securities
Securities were ¥34,183.0 billion, increasing by ¥1,829.8 billion
from the end of the previous fiscal year due to an increase in JGBs
and other factors.
JGB balance (MHBK + MHTB)1

Medium- and long-term bonds2

17.2

2.6
0.7
13.8

75,201.7

75,416.0(214.2)

55,729.0

56,288.5(559.5)Mar. 31,2015

Loans to SMEs andindividual customers

32,740.4

32,500.8

239.6

Average remaining period3(Housing loans forowner’s residential
housing)

9,136.8

9,497.5(360.7)

19,472.7

19,127.5

345.2

Liabilities

195,207.0

191,235.2

3,971.8

Deposits

125,081.2

120,045.2

5,036.0

96,788.3

92,744.3

4,044.0

Individual deposits

42,861.9

41,381.9

1,479.9

Corporate deposits

47,109.9

43,941.2

3,168.6

Financial/government
institutions

6,816.5

7,421.1(604.5)

Negotiable certificates of deposit

11,382.5

10,631.2

751.3

9,821.2

9,273.3

547.8

7,388.3

7,001.2

387.0

2,256.5

2,256.2

0.2

Domestic total

Overseas total

Domestic deposits(MHBK + MHTB)

Net assets
Total shareholders’ equity
Common stock and preferredstock

2.6 years

Capital surplus

1,134.9

1,134.4

0.5

Retained earnings

4,002.8

3,615.4

387.3

(5.9)

(4.8)

(1.1)

1,677.5

1,520.9

156.5

Net unrealized gains (losses)
on other securities

1,392.3

1,289.9

102.4

Deferred gains or losses onhedges

(67.5)

10.1(77.7)

Revaluation reserve for land

144.2

145.6

(1.3)

Foreign currency translation
adjustments(85.0)(69.6)(15.4)

Remeasurements of defined
benefit plans

293.5

144.8

148.6

Treasury stock
Total accumulated othercomprehensive income

Stock acquisition rights

1.1

1.7

(0.5)

Non-controlling interests

754.2

749.3

4.8

15.6

(Acquisition cost basis)

Floating-rate notes

0.5
0.6
14.4

10.2

Treasury discount bills(¥ trillion)

13.3
1.7
0.6
7.8

3.4
0.6
9.2

Mar. 31,2016

Mar. 31,2017

Mar. 31,2018

2.5 years

2.4 years

2.5 years

1. Other securities which have readily determinable fair values
2. Including bonds with remaining period of one year or less
3. Excluding floating-rate notes

Japanese stocks (consolidated)* (¥ billion)

(Acquisition cost basis)

1,962.9
1,847.1
1,687.5
1,564.8

Mar. 31,2015

Mar. 31,2016

Mar. 31,2017

Mar. 31,
2018*Other securities which have readily determinable fair values

2018 Integrated Report102

Financial review

Loans

Total net assets

The combined total of loans for the Two Banks was ¥75,201.7
billion, a decrease of ¥214.2 billion from FY2016. For our loanbalance in Japan, while the balance of large, medium, and small
businesses increased, that of personal loans and that such as
Japanese government loans decreased, resulting in an overall
decrease of ¥559.5 billion (including ¥1,115.9 billion loans to theJapanese government, etc.). Our loan balance outside Japan(including loans booked offshore) increased by ¥345.2 billion,
mainly due to an increase in loans in Asia.

Net assets amounted to ¥9,821.2 billion, increasing by ¥547.8 billion
from FY2016 due to an increase in retained earnings by recording
profit attributable to owners of parent, an increase in accumulated
adjustment amounts related to retirement benefits, and otherfactors.

Loan balance (MHBK + MHTB, banking account + trust account)
Loan balance in Japan

Loan balance outside Japan

74.9(¥ trillion)

75.4

74.7

75.2

18.4

19.2

19.1

19.4

56.4

55.5

56.2

55.7

Mar. 31,2015

Mar. 31,2016

Mar. 31,2017

Mar. 31,2018

Non-performing loans (NPLs)
The combined NPL balance of the Two Banks was ¥558.7 billion,a decrease of ¥281.2 billion from FY2016, and the NPL ratio was
0.66%. We maintained a good credit portfolio, with both the NPL
balance and ratio remaining stable in a low position.

D isclosed claims under the FRA*(MHBK + MHTB, banking account + trust account)
Claims for special attention (¥ trillion)
Claims with collection risk (¥ trillion)
Claims against bankrupt and substantially bankrupt obligors (¥ trillion)
NPL ratio (%)

1.20
1.0

Deposits

Deposits in Japan (MHBK + MHTB)
Corporations

36.5
39.4

7.4

6.8

40.6

43.9

47.1

40.2

41.3

Mar. 31,2016

Mizuho Financial Group(¥ trillion)

96.7

92.7
7.1

5.8

103

Financial/government institutions

88.0

81.8

Mar. 31,
2015

1.00

0.8

0.8

0.66
0.5

The combined deposits in Japan of the Two Banks increased by¥4,044.0 billion from FY2016 due to factors such as an increase incorporate deposits.

Individuals

1.00

Mar. 31,2017

42.8
Mar. 31,2018

Mar. 31,2015

Mar. 31,2016

Mar. 31,2017

Mar. 31,2018*Financial Reconstruction Act

 isclosed claims under the FRAD(MHBK + MHTB, banking account + trust account)(¥ billion)

March 31,2018

March 31,2017

Change fromMarch 31,2017

Claims against bankrupt andSubstantially bankrupt obligors

76.6

82.7

(6.1)

Claims with collection risk

284.2

390.0

(105.7)

Claims for special attention

197.8

367.2

(169.4)

Subtotal

558.7

840.0

(281.2)

Normal claims

83,644.2

82,716.4

927.8

Total

84,203.0

83,556.4

646.5

NPL ratio

0.66%

1.00%

(0.34%)

Financial review Review and analysis for fiscal 2017

BIS capital
BIS capital

BIS capital ratio

The Common Equity Tier 1 capital was ¥7,437.0 billion, an increaseof ¥435.3 billion from FY2016, due to the increase in retained
earnings by recording profit attributable to owners of parent.

Common Equity Tier 1 capital ratio (consolidated) (%)
Tier 1 capital ratio (consolidated) (%) Total capital ratio (consolidated) (%)

10.50

15.41
12.64

18.24

16.28
11.34

15.44

13.30

12.49

Risk assets
Mar. 31,2016

The risk-weighted assets were ¥59,528.9 billion, a decrease of¥2,188.1 billion from FY2016, due to a decrease in credit risk
related assets

The Common Equity Tier 1 ratio increased by 1.15% from FY2016
to 12.49%.
(¥ billion)

March 31,2018

March 31,2017

Change fromMarch 31,2017

Common Equity Tier 1 capital(CET1)

7,437.0

7,001.6

435.3

Capital stock, surplus, andretained earnings

7,387.8

7,000.6

387.1

Additional Tier 1 capital

1,755.1

1,209.8

545.3

Additional Tier 1 capital
instruments

1,220.0

760.0

460.0

577.5

577.5

—

Eligible Tier 1 capital instruments
subject to phase-out arrangements

1,668.1

1,839.4(171.2)Tier 2 capital instruments

988.1

852.4

135.6

Eligible Tier 2 capital instruments
subject to phase-out arrangements

674.8

842.1

(167.3)

Total capital

10,860.4

10,050.9

809.4

Risk-weighted assets

59,528.9

61,717.1(2,188.1)

Credit risk assets

53,647.3

56,060.0(2,412.7)

Market risk equivalent assets

2,470.3

2,282.8

187.4

Operational risk equivalent assets

3,411.2

3,374.2

37.0

Total capital ratio (consolidated)

18.24%

16.28%

1.96%

Tier 1 capital ratio (consolidated)

15.44%

13.30%

2.14%

Common Equity Tier 1 capital ratio(consolidated)

12.49%

11.34%

1.15%

Tier 2 capitalMar. 31,2018

Mizuho continues to perform disciplined capital management policy
which maintains the optimum balance between strengthening of
the stable capital base and steady returns to shareholders.

BIS capital ratio

BIS capital ratio (consolidated)

Mar. 31,2017

Status of capital adequacy
The total capital ratio, Tier 1 capital ratio, and Common Equity Tier 1
capital ratio at the end of March 2018 were 18.24%, 15.44%, and12.49%, respectively.

Under our current medium-term business plan, we aim to achieve a
Common Equity Tier 1 capital ratio of approximately 10% by the endof the final year (FY2018) (fully effective basis* based on current
regulations), excluding net unrealized gains on other securities).
This ratio is steadily increasing and stood at 10.15% on March 31,
2018, thus attaining the target level one year ahead of schedule.
* Calculated on a Basel III fully effective basis at the end of FY2018.

Dividend policy
As for our policy to return profits to shareholders, we have
implemented a steady dividend payout policy setting a dividend
payout ratio on a consolidated basis of approximately 30% as a
guide for our consideration.
Based on this policy, we made cash dividend payments on common
stock of ¥7.50 (¥3.75 for interim dividends and ¥3.75 for year-end
dividends) for the fiscal year ended March 31, 2018, the sameamount as the annual dividend of the previous fiscal year. The Boardof Directors of Mizuho Financial Group has considered thoroughly
and decided it by taking into account our business environment
comprehensively such as the financial results for FY2017 in which
profit attributable to owners of parent achieved earnings estimates,
future earnings forecasts, profit base, status of capital adequacy,
and domestic and international regulation trends such as the Baselframework.
Cash dividend per share of common stock ( ¥ )
7.5

7.5

7.5

7.5

FY2014FY2015FY2016FY2017

28%

31%

33%

Dividend payout ratio
30%

2018 Integrated Report104Company information

Office network

We utilize our office network, which covers every prefecture in Japan as well as major cities outside Japan, to respond to ourcustomers’ diversified and globalizing financial needs while supporting their economic activities.

Europe, the Middle East, and Africa

Asia and Oceania

Mizuho Bank

17 offices

Mizuho Bank

44 offices

Mizuho Trust & Banking

1 officeMizuho Securities

9 officesMizuho Securities

4 offices

Asset Management One

2 offices

Asset Management One

1 office

Amsterdam
Düsseldorf

Brussels

Frankfurt

LondonMoscow

Nanjing
Wuxi

ViennaMilan

Bahrain

New Delhi

RiyadhDubai

SuzhouWuhan

TehranZurich

Seoul

Hefei

Istanbul

MadridDalianQingdao

Luxembourg
Paris

TianjinBeijing

Ahmedabad

XiamenShenzhen
Guangzhou

Taipei

Hanoi

Taichung

ShanghaiKaohsiung

MumbaiHong Kong

Bangalore-Devanahalli

Johannesburg

YangonThilawa
Bangkok
Eastern Seaboard
Phnom Penh
Ho Chi Minh City
Kuala Lumpur
Singapore

ManilaChennai

Jakarta105

Mizuho Financial Group

LabuanSydneyCompany information Office network

International network (As of June 30, 2018)
Mizuho Bank: 89 offices

Mizuho Trust & Banking: 1 office

Branch or equivalent

42

Representative office

6

Subsidiary

41

SubsidiaryMizuho Securities: 24 offices

1

Representative office2

Subsidiary

22

Asset Management One: 4 offices
Subsidiary4Note: Subsidiaries include head offices, branches or relevant offices, and representative offices of overseas subsidiaries.

AmericasMizuho Bank

28 offices

Mizuho Securities

11 offices

Asset Management One

1 office

Calgary

ChicagoTorontoBostonIselin

New York

San Francisco

Philadelphia

Atlanta

Washington, DC

Los Angeles

NassauDallas
HoustonLeón

CaymanMexico City

Network in Japan (As of June 30, 2018)
Mizuho Bank
Head office and branches: 421
Sub-branches: 44
Mizuho Trust & Banking
Head office and branches: 36
Sub-branches: 24
Mizuho Securities
Santiago
Tokyo head office and regional head offices: 3
Branches: 105
Planet Booths*: 153
Sales office: 1*Planet Booths are the consulting boothsof Mizuho Securities located in Mizuho Bank’s branchesSão Paulo• In April 2017, Mizuho Bank Phnom Penh
Representative Office (opened July 2013)
became Mizuho Bank Phnom Penh Branch(under the Bangkok Branch).
• In October 2017, Mizuho Bank opened
Mizuho Bank Mexico, SA, León Office.
• In October 2017, Mizuho Bank opened
Washington, DC Representative Office.
• In March 2018, Mizuho Bank opened theDallas Representative Office in Texas (USA).
• In October 2017, Mizuho Securities opened
Mizuho Securities Asia Limited, Seoul
Branch.
• In January 2018, Mizuho Securities opened
Mizuho International plc (DIFC* Branch) in
Dubai.
*DIFC: Dubai International Financial Centre• In April 2018, Mizuho Securities opened
Mizuho Securities Asia Limited (Sydney
Office).
• In June 2018, Mizuho Securities establishedMizuho Securities Europe GmbH in
Frankfurt, Germany, and is in the process ofobtaining a license for securities business.
• In December 2017, Mizuho Trust & Banking
Co. (USA) merged and became part ofMizuho Bank (USA).

2018 Integrated Report106Corporate profile

Corporate profile (As of March 31, 2018)

Company name:

Mizuho Financial Group, Inc.

Stock listing (code):Tokyo Stock Exchange (8411)
New York Stock Exchange (MFG)

Location of head office: 1-5-5, Otemachi, Chiyoda-ku, Tokyo
100-8176, Japan

Rating information(As of June 30, 2018)

R&I

JCR Moody’s S&P

Fitch

Mizuho Financial Group

A+

AA-

A1

A-

A-

Representative:

Tatsufumi Sakai, President & Group CEO(Appointed on April 1, 2018)

Mizuho Bank

AA-

AA

A1

A

A-

Capital:¥2,256.2 billion

Mizuho Trust & Banking

AA-

AA

A1

A

A-

Issued shares:

25,389,644,945 shares

Number of employees:

1,526(Total number of employees on a consolidated
basis: 60,051)

Mizuho Securities

AA-

AA

A1

A

—

(Reference)
Japanese Government

AA+

AAA

A1

A+

A

Date of establishment:

January 8, 2003

Historical data of stock price

Shareholders (common stock)Mizuho Financial Group

Foreign investors

23.39%
National & municipal
government

Individuals and others

160

31.29%

140

0.03%

Nikkei Index

120

Other domestic
companies

100

12.68%

Securities
companies

4.56%

80

Financial institutions

28.05%

Website60

March 2016 September 2016 March 2017 September 2017 March 2018
The graph showing Mizuho Financial Group’s stock price and the Nikkei stock
price average has been prepared as an index with the closing prices on March
31, 2016 as 100.
©Nikkei

Our website provides additional information regarding
the business operations of Mizuho Financial Group andour group companies. Sections covering IR, financial
information, and our products and services are available
in addition to in-depth industry and economic reports.
Additionally, you can sign up for our News Release E-mailDistribution Service to receive updates by email.

‌www.mizuho-fg.com/

Corporate responsibility

Investor relations

Gain insights into our approach to CSR.

Access reports, presentations, news, and other investor resourcesand get details on upcoming events.

‌‌www.mizuho-fg.com/csr/

107

Mizuho Financial Group‌‌www.mizuho-fg.com/investors/

Company information

Group companies (As of March 31, 2018, except for each company’s network, which is as of June 30, 2018)

Mizuho Bank

Mizuho Trust & Banking

Date of establishment

July 1, 2013

Date of establishment

March 12, 2003

Capital¥1,404.0 billion

Capital¥247.3 billion

Location of head office 1-5-5, Otemachi, Chiyoda-ku, Tokyo
100-8176, Japan

Location of head office 1-2-1, Yaesu, Chuo-ku, Tokyo
103-8670, Japan

Representative

Koji Fujiwara, President & CEO

Representative

Tetsuo Iimori, President & CEO

Number of employees

30,301

Number of employees

3,415

Network in Japan

465

Network in Japan

60

Network outside Japan 89
Websitewww.mizuhobank.com/

Network outside Japan 1
Websitewww.mizuho-tb.co.jp/english/

Mizuho Securities
Date of establishment

January 4, 2013

Capital¥125.1 billion

Location of head office Otemachi First Square, 1-5-1, Otemachi,
Chiyoda-ku, Tokyo
100-0004, Japan
Representative

Koichi Iida, President & CEO(Appointed on April 1, 2018)

Number of employees

7,554

Network in Japan

262

Network outside Japan 24
Websitewww.mizuho-sc.com/english/

2018 Integrated Report108Company information

Mizuho Research InstituteMizuho Information & Research InstituteMizuho Research Institute is one of Japan’s leading think tanks
providing research, consulting, and corporate memberships. In
addition to providing high-value-added information and preparing
policy proposals, Mizuho Research Institute offers highly actionableconsulting advice to assist the Japanese national government, local
governments, and private corporations in addressing the issues
they confront. Mizuho Research Institute has the largest number ofcorporate membership subscribers of any bank-affiliated research
institute in Japan.

With IT as its core technology, Mizuho Information & ResearchInstitute is a professional organization with more than 4,000
employees that provides assistance to corporations in increasing
their corporate value through its consulting, system integration, andoutsourcing services.

Date of establishment

October 1, 2002

Date of establishment

October 1, 2004

Capital¥900 million

Capital¥1,627 million

Location of head office

1-2-1, Uchisaiwaicho, Chiyoda-ku, Tokyo

Location of head office

2-3 Kanda-Nishikicho, Chiyoda-ku, Tokyo

Representative

Hideyuki Takahashi, President & CEO

Representative

Junichi Nishizawa, President & CEO

Number of employees

322

Number of employees

4,283

Websitewww.mizuho-ri.co.jp/english/

Websitewww.mizuho-ir.co.jp/english/

Asset Management One

Trust & Custody Services Bank

Asset Management One is an asset management company in which
Mizuho and Dai–ichi Life Holdings both have equity holdings. AssetManagement One collaborates with its offices in Europe, the US, andAsia to offer investment trust products to individuals andcorporations, as well as provide investment advisory services tocustomers including Japanese and overseas pension funds.

As Mizuho’s trust bank specializing in asset administration, Trust& Custody Services Bank provides high-quality, high-value-added
trust and custody services to clients, including large institutional
investors. As of March 31, 2018, the balance of assets under custody
and administration exceeded ¥380 trillion, one of the largest suchbalances in Japan.

Date of establishment

October 1, 2016

Date of establishment

January 22, 2001

Capital¥2,000 million

Capital¥50,000 million

Location of head office

Tekko Building, 1-8-2 Marunouchi,
Chiyoda-ku, Tokyo

Location of head officeTower Z, Harumi Triton Square, 1-8-12,
Harumi, Chuo-ku, Tokyo

Representative

Akira Sugano, President & CEO(Appointed on April 1, 2018)

Representative

Nobumitsu Watanabe, President & CEO(Appointed on June 14, 2018)

Number of employees

908

Number of employees

668

Network outside Japan

4

Websitewww.tcsb.co.jp/english/

Websitewww.am-one.co.jp/english/

Mizuho Private Wealth Management

Mizuho Americas

Mizuho Private Wealth Management offers consulting services
tailored to the needs of its customers. These services range
from consulting on customers’ financial matters such as wealthmanagement, arranging for business inheritance to advice on
customers’ individual matters, including health of the customers
themselves as well as family members and children’s education.

Mizuho Americas was established as a US bank holding company
with Mizuho’s primary US-based banking, trust banking, andsecurities entities under it to meet the US regulations governing theoperations of foreign banks. To further increase its competitivenessin the US, which is the world’s largest financial market, Mizuho
Americas is proactively strengthening its governance framework,
and, while promoting the collaboration of its banking, trust banking,and securities operations, it is conducting management and otheractivities that are necessary for expanding its profit base.

Date of establishment

October 3, 2005

Date of establishment

June 20, 2016

Capital¥500 million

Capital$3,820 million

Location of head office

1-1-5, Uchisaiwaicho, Chiyoda-ku, Tokyo

Location of head office

Representative

Takeru Watanabe, President

1251 Avenue of the Americas, New York,NY 10020, USA

Number of employees

37

Representative

Teiji Teramoto, CEO(Appointed on April 1, 2018)

Websitewww.mizuhoamericas.com/

Notes: 1 .The representatives of each company have representation rights.
2. The number of employees does not include each company’s employees dispatched outside each company while it includes employees dispatched to eachcompany from other organizations. This figure also includes overseas local staff but excludes executive officers and temporary employees.
3. Mizuho’s network consists of our Head Office and branches in Japan, and branches, representative offices and overseas subsidiaries outside Japan.

109

Mizuho Financial GroupAppendix

Compliance contacts

Internal control and audit hotline—A system designed for reporting questionable accounting or auditing matters—
Reporting items: Mizuho Financial Group has established aWhen a report is received concerning the reporting items

hotline to receive reports from in and outside

stipulated on the left, Mizuho Financial Group will make athe company in connection with problems

reasonable effort to investigate the facts behind the information

concerning internal control and audits ofreceived and report back on the results.

accounts and financial reports.

Anonymous tips are also acceptable, but there are cases where itContact point: This hotline has been established within an external

will not be possible to fully satisfy the intentions behind such tips

law office. Reports can be made via postal mail orowing to constraints on investigations and the inability to report

email.

back.

Postal mail: 12th Floor, Kasumigaseki Bldg.,

Information on persons making such reports is not disclosed to

Kasumigaseki 3-2-5, Chiyoda-ku, Tokyo

third parties other than the group companies except in cases

100-6012

where the assent of the person in question has been obtained or

Mizuho Accounting Hotline, c/o Daiichi

such disclosure is required under laws and ordinances.

Fuyo Law Office
Email: kaikei-mizuho@daiichifuyo.gr.jp

Approaches to financial alternative dispute resolution (ADR)
In order to deal expeditiously, fairly, and appropriately withThe designated dispute resolution institution as defined in Japan’scomplaints and other feedback from customers, Mizuho Bank

Banking Act which Mizuho Bank and Mizuho Trust & Banking haveand Mizuho Trust & Banking have concluded a contract for thecontracted

implementation of dispute resolution procedures with the Japanese

The Designated Dispute Resolution Institution: Bankers Association, which is a designated dispute resolution
institution as defined in Japan’s Banking Act. Mizuho Trust &Banking has also concluded a contract for the implementation ofJapanese Bankers Association
Contact: Advisory Center of Japanese Bankers Association
Tel: +81-(0)3-5252-3772

dispute resolution procedures with the Trust Companies Associationof Japan, which is a designated dispute resolution institution

The designated dispute resolution institution as defined in Japan’s

as defined in Japan’s Trust Business Act and Act on Concurrent

Trust Business Act and Act on Concurrent Operation of Trust

Operation of Trust Business by Financial Institutions.

Business by Financial Institutions which Mizuho Trust & Banking
has contracted

The designated dispute resolution institution takes the steps
toward resolution from a fair and neutral perspective in cases
where the solutions to customers’ complaints adopted by the twobanks are not accepted.

The Designated Dispute Resolution Institution: Trust Companies Association of Japan
Contact: Trust Consultation Center of the Trust Companies
Association of Japan
Tel: +81-(0)3-6206-3988

2018 Integrated Report110Appendix

Support for SMEs and regional revitalization

Support for small and medium-sized enterprises (SMEs)
Mizuho provides information to clients which is relevant to their particular needs and challenges at each stage intheir development, and we propose solutions and provide support for the implementation of these solutions.
By drawing on our consulting capabilities to provide proposals andsupport the growth of innovative companies with exceptional

solutions that address the issues SMEs face, we ensure that clients’technologies or ideas.

perspectives are prioritized when providing support for businessexpansion, succession, reorganization, and other client needs.

Furthermore, a specialized business reorganization section within

We also believe that proactively supporting SMEs is a key part of

the Head Office provides support for SMEs’ business improvement

fulfilling our social responsibility as a financial institution.

and reorganization needs. In addition, our Head Office collaborates
with frontline offices to provide consultations and support for clients

In particular, by providing consulting and support for SMEs’ growththrough partnerships with external organizations, external specialists,

strategies, we can introduce clients to potential M&A opportunities

and other financial institutions.

from the standpoint of business expansion and succession, andRegional revitalization initiatives
In Japan, as a result of the trend toward concentration of businesses
and other economic activity solely in Tokyo, rural populations are
expected to decline and regional economies are expected to shrink
in the future. As a nation, Japan must look for ways to revitalize
regional areas through a virtuous cycle in which jobs draw people
back to local areas and population growth creates more jobs.

Utilizing our office network in Japan, we are striving to promote
the revitalization of regional economies by providing our clientswith funding, supporting the operations of local businesses, andcollaborating with regional governments.

Case example
Business reorganization using an RCC
We believe that we can contribute to the healthy development of regional economies and securingjobs through assisting businesses to reorganize. In fiscal 2017, for the first time we assisted a clientwith voluntary liquidation using a resolution and collection corporation (RCC).
In voluntary liquidations, fairness with and transparency to the many claimants, including regional
financial institutions, should be maintained, while prompt responses are also required. Building on
Mizuho’s expertise in business reorganization and the trust we have earned in regional areas, wewill continue to assist clients with business reorganization to help revitalize regional economies.

Finance facilitation and response to the Guidelines for Personal Guarantee Provided by Business Owners
Mizuho works to promote finance facilitation in accordance withFinance facilitationG uidelines for Personal Guarantee Provided by Business Owners
We are committed to establishing and maintaining good relationships

group-wide fundamental policies. This includes ensuring that wewith our clients in line with the Guidelines for Personal Guarantee

respond appropriately to requests for new loans or loan condition

Provided by Business Owners established by the Japanese Bankers

adjustments, and provide tailored consulting.

Association and the Japan Chamber of Commerce and Industry.
We provide the option for a joint guarantee with a termination clauseand other alternative lending methods allowing for a personal
guarantee provided by business owners. Also, we have establisheda structure for cooperation between our frontline offices and Head
Office to encourage the utilization of these methods.

111

Mizuho Financial GroupAppendix

Internal audit structure

Basic approach
Internal audits are designed as an integrated process, independentgroup companies to fulfill their managerial duties efficiently andfrom other business operations, for evaluating the extent to which

effectively.

internal control achieves its objectives in key areas, including
appropriate risk management; efficient and effective businessIn line with the Basic Policy for Internal Audit established by Mizuho

operations; reliable financial reporting; and compliance with laws,

Financial Group, our core group companies conduct internal audits,

regulations, and internal rules. We conduct internal audits from an

which include the auditing of their respective subsidiaries. In

objective and comprehensive standpoint, independent of operational

addition, with respect to the management of risks applicable acrossreporting lines, and offer advice and remedial recommendations in

the group, we coordinate internal audits throughout the group toconnection with any problems that may be identified. Through thisassess the risk management status of the group as a whole.

process, internal audits assist the Boards of Directors of each of ourInternal audit management structure

matters concerning internal audits, is chaired by the President &Group CEO and is independent of our other business operations.
The Committee monitors and manages internal audits at our coregroup companies based on internal audit reports submitted by theInternal audit management structure
Mizuho Financial Group
Supervision,
audit

Mizuho Financial Group
Our Internal Audit Committee, which determines all important

Board of Directors

Audit Committee

companies.
President & Group CEO

Our Internal Audit Committee discusses and makes decisions

Internal Audit Committee(Chairman: President & Group CEO)these decisions, together with the results of their examination of
the internal audit reports, to the Audit Committee and our Board of
Directors.

Management

regarding internal audits at our core group companies and submits
Internal Audit GroupInternal Audit

Mizuho Bank and Mizuho Trust & Banking

All organizational
unitsInternal Audit Department

Mizuho Bank and Mizuho Trust & Banking have also establishedInternal Audit Committees that are independent of their otherbusiness operations. The two banks have established internal audit
departments to conduct internal audits at their respective domestic
and overseas offices, head office departments, and group companies.
Specifically, we assess the suitability and effectiveness of business

Management by Mizuho
Financial Group

Advice, guidance
and remedialrecommendations

Report the resultsof internal audits

activities associated with compliance and risk management.
Mizuho Bank, Mizuho Trust & Banking, Mizuho Securities
and other core group companies

Other core group companies
Other core group companies have also established effective
and efficient internal audit structures adapted to thecharacteristics of their respective businesses.

Subsidiaries of the above group companies(As of June 22, 2018)2018 Integrated Report112Appendix

Risk management structure

Credit risk management
Basic approach
We define credit risk as the group’s exposure to the risk of losses

Mizuho Financial Group manages credit risk for the Group as athat may be incurred due to a decline in, or total loss of, the value

whole. Specifically, Mizuho Financial Group establishes the group’sof assets (including off–balance–sheet instruments), as a result offundamental credit risk policy to manage major group companies,

deterioration in obligors’ financial position. We have established theand monitors and manages the credit risks of the group as a whole.

methods and structures necessary for grasping and managing credit
risk.

Credit risk management structure
Our Board of Directors determines the group’s basic matters

The Balance Sheet & Risk Management Committee and the Credit

pertaining to credit risk management. In addition, the Risk

Committee, each of which is a Business Policy Committee of ourManagement Committee of Mizuho Financial Group discusses

principal banking subsidiaries, are responsible for discussing

and coordinates matters relating to basic policies and operations

and coordinating overall management of their individual credit

in connection with credit risk management and matters relating

portfolios and transaction policies towards obligors. The respective

to credit risk monitoring for the group. Under the control of the

Chief Risk Officers of our principal banking subsidiaries areGroup CRO of Mizuho Financial Group, the Credit Risk Management

responsible for matters relating to planning and implementing

Department and the Risk Management Department jointly monitor,

credit risk management. The credit risk management departments

analyze, and submit suggestions concerning credit risk and formulateof our principal banking subsidiaries are in charge of planning andand execute plans in connection with basic matters pertaining toadministering credit risk management and conducting credit risk

credit risk management.

measuring and monitoring. The departments regularly present
reports regarding their risk management situation to Mizuho

Our principal banking subsidiaries and other core group companies

Financial Group. The credit departments of our principal banking

manage their credit risk according to the scale and nature of theirsubsidiaries determine policies and approve/disapprove individual

exposures in line with basic policies set forth by Mizuho Financialtransactions in terms of credit review, credit management andGroup. The Board of Directors of each company determines key

collection from obligors in accordance with the lines of authority set

matters pertaining to credit risk management.

forth respectively by our principal banking subsidiaries. In addition,
our principal banking subsidiaries have established internal audit
groups that are independent of the business departments in order toensure appropriate credit risk management.

Method of credit risk management
We have adopted two different but mutually complementaryclient. Through this process, we curb losses in the case of a credit

approaches to credit risk management. The first approach is

event. The second is “credit portfolio management,” in which we“individual credit management,” in which we manage the process

utilize statistical methods to assess the potential for losses related tofor each individual transaction and individual obligor from execution

credit risk. Through this process, we identify credit risks and respond

until collection, based on our assessment of the credit quality of theappropriately.

Individual credit management
1. Credit code

2. Internal rating system

The basic code of conduct for all of our executive officers andOne of the most important elements of the risk management

employees engaged in the credit business is set forth in our credit

infrastructure of our principal banking subsidiaries is the use ofcode. Seeking to fulfill our mission and social responsibilities, ouran internal rating system that consists of credit ratings and poolbasic policy for credit business is determined in light of fundamental

allocations. Credit ratings consist of obligor ratings which represent

principles focusing on public welfare, safety, growth, and profitability.

the level of credit risk of the obligor, and transaction ratings which
represent the possibility of ultimately incurring losses related toeach individual claim by taking into consideration the nature of any
collateral or guarantee and the seniority of the claim. In principle,
obligor ratings apply to all obligors and are subject to regularreviews at least once a year to reflect promptly the fiscal period
end financial results of the obligors, as well as special reviews asrequired whenever an obligor’s credit standing changes. This enables
our principal banking subsidiaries to monitor both individual

113

Mizuho Financial GroupAppendix Risk management structure

obligors and the status of the overall portfolio in a timely fashion.

based on obligor specific characteristics such as type of business

Because we consider obligor ratings to be an initial phase of the(corporation or individual) and geography (in Japan or outside

self-assessment process regarding the quality of our loans and off-

Japan). We categorize our rating models for companies in Japanbalance-sheet instruments, such obligor ratings are closely linked

into those for large companies and those for small and medium-to the obligor classifications and are an integral part of the process

sized companies. The former consist of 13 models according tofor determining the provision for loan losses and charge-offs in our

industry-specific factors, while the latter consist of three models. For

self-assessment of loans and off-balance-sheet instruments. (Please

companies outside Japan, we utilize nine models.

refer to the chart below regarding the connection between obligor
ratings, definition of obligor classifications of self-assessments,

These were developed by the Credit Risk Management Department

claims disclosed under the FRA and non-accrual, and past due &based on a statistical methodology and approved by the Chief Risk

restructured loans).

Officer.

To assign obligor ratings, we have a quantitative evaluation system

Pool allocations are applied to small claims that are less than a(rating model) in place to enable proper assessment of an obligor’s

specified amount by pooling obligors and claims with similar risk

credit standing. The system gives a quantitative rating to an obligor

characteristics and assessing and managing the risk for each such

Connection between obligor ratings, definition of obligor classifications of self-assessments, claims disclosed under the FRA and
non-accrual, past due & restructured loans
Definitionof obligor
classifications ofself-assessment

Obligorratings(major
category)
A1—A3

Obligors whose certainty of debt
fulfillment is very high, hence their levelof credit risk is excellent.

B1—B2

Obligors whose certainty of debt
fulfillment poses no problems for theforeseeable future, hence their level ofcredit risk is sufficient.

C1—C3

Obligors whose certainty of debt
fulfillment and their level of credit riskpose no problems for the foreseeable
future.

D1—D3Obligors whose current certainty of debt
fulfillment poses no problems, however,their resistance to future environmental
changes is low.

Normalobligors

E1
Watch
obligors

Intensive control
obligors

Substantiallybankrupt
obligors

Bankrupt
obligors

Definition of ratings

E2

R

F1

G1

H1

Category I(noncategorized)

Obligors who have not yet gone legallyor formally bankrupt but who aresubstantially bankrupt because they are
in serious financial difficulties and are notdeemed to be capable of restructuring.

Obligors who have already gonebankrupt, from both a legal and/or formal
perspective.

Category III

Category IV(noncollateralized)

All credit given
to normal
obligors.

Obligors who require close watching
going forward because there areproblems with their borrowings, such as
reduced or suspended interest payments,
problems with fulfillment such as defacto postponements of principal orinterest payments, or problems with theirfinancial positions as a result of theirpoor or unstable business conditions.
Obligors who are not yet bankrupt but arein financial difficulties and are deemed
to be very likely to go bankrupt in the
future because they are finding it difficult
to make progress in implementing
their management improvement plans(including obligors who are receiving
ongoing support from financial
institutions).

Category II

Non-accrual,
past due &restructured
loans

Normal claims

Credit given to
watch obligors
other thanthose included
in category I.

Credit to
obligors whichhas pledged
collateral oris covered byguarantees,consideredof highquality, suchas deposit
collateral.

Claimsdisclosed
under the FRA

Claims for
specialattention

Credit given
to intensive
control
obligors otherthan thoseincluded in
category I andcategory II.
Credit to
obligors whichis coveredby generalcollateral,such as realestate andguarantees.

The difference
between theassessedvalue andmarket valueof collateralon credit tobankrupt andsubstantiallybankrupt
obligors (i.e.,
the portion ofloans for which
final collection
problems orlosses are
anticipated).

Restructured
loans
Loans past due
for 3 months
or moreClaims withcollection risk
Non-accrualdelinquent
loans
Credit tobankrupt andsubstantiallybankrupt
obligors, otherthan thosein categoryI, category II
and category
III (credit thatis judged to be
unrecoverable
or without
value).

Claims against
bankrupt andsubstantiallybankrupt
obligors, andequivalent
Loans tobankrupt
obligors

2018 Integrated Report114

Appendix

pool. Our principal banking subsidiaries efficiently manage credit

extended to watch obligors when the following conditions are met:risk and credit screening by dispersing a sufficient number of small

we are aiming for business reconstruction or financial support;

claims within each pool. Our principal banking subsidiaries generally

and lending conditions were amended favorably to the client such

review the appropriateness and effectiveness of our approach toas allowing interest rate reduction, postponement of principal

obligor ratings and pool allocations once a year in accordance withrepayment/interest payment, debt forgiveness, etc.

predetermined procedures, which is audited by the Internal Audit
Group.

An overdue loan is defined as a loan for watch obligors of which
the loan principal or interest is overdue for three months or more

Mizuho Financial Group defines a restructured loan as a loan

following the contractual payment date.

Methods for reserves and write-offs
Normalobligors

Calculate the value of estimated loss based on the probability of failure over the coming year for loans by obligor rating and appropriate it for the
General reserve for possible losses on loans.

Watch
obligors

Calculate the estimated loss on loans based on the probability of failure over the next three years and appropriate it for the general reserve forpossible losses on loans. Further, in regard to special attention obligors, for obligors with large claims more than a certain amount, if the cash
flow from the return of principal and interest payments can reasonably be estimated, set up a reserve under the DCF method.

Intensive
control
obligors

Substantiallybankrupt
obligors

Provide an amount for specific reserve for possible losses on loans as calculated by one of the following methods after deducting amounts
anticipated to be recoverable from the sale of collateral held against the claims and from guarantors of the claims: a) an amount calculated basedon the overall ability of the obligor to pay, or b) the estimated loss calculated on the basis of the balance and the probability of failure over the
next three years.
Further, for obligors with large claims more than a certain amount, if the cash flow from the return of principal and interest payments canreasonably be estimated, set up a reserve under the DCF method.

Provide the entire balance after deducting amounts anticipated to be recoverable from the sale of collateral held against the claims and fromguarantors of the claims for specific reserve for possible losses on loans, or write-off the entire balance.

Bankrupt
obligors

3. Self-assessment, provision for loan losses and off-balance-sheet
instruments, and write-offs

Prevention of new impaired loans through routine credit

We conduct self-assessment of assets to ascertain the status of assets

management is important in maintaining the quality of our overallboth as an integral part of credit risk management and in preparationloan assets. Credit review involves analysis and screening of eachfor appropriate accounting treatment, including provision for loan

potential transaction within the relevant business department. In

losses and off-balance-sheet instruments and write-offs. During thecase the screening exceeds the authority of the department, theprocess of self-assessment, obligors are categorized into certain

credit department in charge at Head Office carries out the review. We

groups taking into consideration their financial condition and their

have specialized credit departments for different industries,

ability to make payments, and credit ratings are assigned to allbusiness sizes, and regions, which carry out timely and specialized

obligors, in principle, to reflect the extent of their credit risks. The

examinations based on the characteristics of the client and theirrelated assets are then categorized into certain classes based on themarket, and provide appropriate advice to the business department.

risk of impairment. This process allows us to identify and control the

In addition, in the case of obligors with low credit ratings and highactual quality of assets and determine the appropriate accounting

downside risks, the business department and credit department

treatment, including provision for loan losses and off-balance-sheet

jointly clarify their credit policy and in appropriate cases assist the

instruments and write-offs. Specifically, the credit risk management

obligors at an early stage in working towards credit soundness.

department of each of our principal subsidiaries is responsible
for the overall control of the self-assessment of assets of therespective banking subsidiaries, cooperating with the administrative
departments specified for each type of asset, including loan portfolios
and securities, in executing and managing self-assessments. In ourassessment of the probability of obligor bankruptcy, we deem anobligor that is rated as being insolvent or lower as being bankrupt.

115

4. Credit review

Mizuho Financial GroupAppendix Risk management structure

Credit portfolio management
1. Risk measurement
We use statistical methodologies that involve a risk measurement

guarantees; deposits and foreign exchange; derivatives including

system (enterprise value corporate valuation model, holding period

swaps and options; off-balance sheet items including commitments;of one year) to manage the possibility of losses by measuring theand other assets involving credit risk.

expected average loss for a one-year risk horizon (“Expected Loss”)
and the maximum loss within a certain confidence interval (“Credit

In establishing transaction spread guidelines for credit transactions,

VAR”). The difference between Expected Loss and Credit VAR is

we aim to ensure an appropriate return from the transaction in lightmeasured as the credit risk amount (“Unexpected Loss”). The riskof the level of risk by utilizing credit cost data as a reference. Also,

measurement system covers the following account items reported by

we monitor our credit portfolio from various perspectives and set

each Mizuho Financial Group company: credit transactions including

guidelines noted below so that losses incurred through a hypotheticalloans and discounts; securities; clients’ liabilities for acceptances andrealization of the full Credit VAR would be within the amount of risk
capital and loan loss reserves.
2. Risk control methods

Loss distribution

Our principal banking subsidiaries recognize two types of risk arising

Frequencyfrom allowing Unexpected Loss to become too large. One type is
Average

This amount depends onthe confidence interval. For
example, if the confidence
interval is set at 99%, it is
the 9,900th smallest loss
figure out of 10,000 trials.

“credit concentration risk,” which stems from granting excessive
credit to certain individual counterparties or corporate groups.
The other type is “chain-reaction default risk,” which arises from
granting excessive credit to certain areas, industrial sectors, andother groupings. Our principal banking subsidiaries manage theserisks in line with our specific guidelines for each. (Please refer to thechart below regarding the allocation of risk capital and control ofcredit risk). Our principal banking subsidiaries also set the credit limit
based on verification of status of capital adequacy. In cases where theLoss amountlimit is exceeded, our principal banking subsidiaries will formulatea handling policy and/or action plan. In addition to the above, ourCredit VAR
Expected
Loss

principal banking subsidiaries monitor total credit exposure, credit
exposure per rating, credit concentration per individual company,

Unexpected Losscorporate group, geography, country, and business sector to
make a periodical report to the Balance Sheet & Risk Management
Committee and the Credit Committee.

Allocation of risk capital and control of credit risk
Allocation of risk capital

Credit VAR

Credit concentration risk
1 Individual company credit
guidelines
2 Corporate group-based credit
guidelines
Mizuho Bank: Sets 1 2 3 4Mizuho Trust & Banking: Sets 1 2 4

Chain reaction default risk

Control

Equivalent to credit concentration risk amounts

3 Geographical area/country-based
credit guidelines
4 Industrial sector-based credit
guidelines

Equivalent to chain reaction default risk amounts

2018 Integrated Report116Appendix

Market risk management
Basic approach
We define market risk as the risk of losses incurred by the group due

Mizuho Financial Group manages market risk for the Mizuho groupto fluctuations in interest rates, stock prices, and foreign exchange

as a whole. Specifically, Mizuho Financial Group establishes therates. Our definition includes the risk of losses incurred when it

fundamental risk management policy for the entire group, manages

becomes impossible to execute transactions in the market because

the market risk of our principal banking subsidiaries and other coreof market confusion or losses arising from transactions at prices thatgroup companies, and monitors how the group’s market risk is being

are significantly less favorable than usual.

managed as a whole.

Market risk management structure
Our Board of Directors determines basic matters pertaining to market

As for the situation of market risk, the Risk Management Department

risk management policies. The Risk Management Committee ofsubmits reports to the President and Group CEO on a daily basis

Mizuho Financial Group broadly discusses and coordinates mattersand to the Board of Directors on a regular basis. For the purpose

relating to basic policies in connection with market risk management,of managing the market risk of our principal banking subsidiaries

market risk operations, and market risk monitoring. The Group CRO

and other core group companies, the Department regularly receivesof Mizuho Financial Group is responsible for matters relating toreports from each of them to properly identify and manage theirmarket risk management planning and operations.

market risk. These subsidiaries and core group companies, which
account for most of the Mizuho group’s exposure to market risk,

The Risk Management Department of Mizuho Financial Group isestablish their basic policies based on ours, and their Boards of

responsible for monitoring market risk, reporting and analysing,Directors determine important matters relating to market risk

making proposals, setting limits and guidelines, and formulating andmanagement.

implementing plans relating to market risk management.

Market risk management method
To manage market risk, we set limits that correspond to risk capitalstrength represented by capital and other indicators. The amount ofallocations according to the risk profile of each of our principal

risk capital allocated to market risk corresponds to value-at-risk (thebanking subsidiaries and other core group companies and thereby“VAR”) and additional costs that may arise in order to close relevant

prevent the overall market risk we hold from exceeding our financial

positions.

Setting limits

Monitoring

When the above mentioned limits are set, various factors are

To provide a system of mutual checks and balances in market

taken into account, including business strategies, historical limit

operations, we have established middle offices specializing in risk

usage ratios, risk-bearing capacity (profits, equity capital, and risk

management that are independent of front offices which engage inmanagement framework), profit targets and the market liquidity ofmarket transactions and of back offices which are responsible forthe products involved. The limits are discussed and coordinated bybook entries and settlements. When VAR is not adequate to control

the Risk Management Committee, discussed further by the Executive

risk, the middle offices manage risk using additional risk indices,Management Committee and then determined by the President &carry out stress testing, and set stop loss limits as needed. We

Group CEO. For trading and banking activities, we set limits for VAR

monitor market liquidity risk for individual financial products in theand for losses. For banking activities, we set position limits based

market while taking turnover and other factors into consideration.

on interest rate sensitivity (10 BPV) as needed. An excess over anyof these limits is immediately reported and addressed according to a
pre-determined procedure.

117

Mizuho Financial GroupAppendix Risk management structure

The following graph shows VAR figures of our trading activities for

Status of Mizuho Financial Group’s market risk

the fiscal year ended March 31, 2018:

Value-at-risk
We use the VAR method, supplemented with stress testing, as ourprincipal tool to measure market risk. The VAR method measuresthe maximum possible loss that could be incurred due to market
movements within a certain time period (or holding period) anddegree of probability (or confidence interval).

Fiscal 2017 VAR (trading activities)(VAR: ¥ billion)
7
6
5

Trading activities

4

VAR related to our trading activities is based on the following:• historical simulation method;3• confidence interval: one-tailed 99.0%;

2• holding period of one day; and1• historical observation period of three years.

VAR by risk category (trading activities)(¥ billion)

03/30/2018

03/11/2018

02/20/2018

02/01/2018

01/13/2018

12/25/2017

12/06/2017

11/17/2017

10/29/2017

10/10/2017

09/21/2017

09/02/2017

08/14/2017

07/26/2017

07/07/2017

06/18/2017

05/30/2017

05/11/20172018 and as of March 31, 2016, 2017, and 2018:04/22/2017

by risk category for the fiscal years ended March 31, 2016, 2017, and04/03/2017

0

The following tables show the VAR related to our trading activities

The following table shows VAR figures of our trading activities for the
fiscal years indicated:

Fiscal 2015

VAR (trading activities)

Daily average

Maximum

Minimum

At March 31

Interest rate

1.8

3.7

0.6

1.1

Fiscal 2015

Fiscal 2016

Fiscal 2017

ChangeForeign exchange

0.9

2.3

0.2

0.3

As of fiscal year end

2.0

2.6

3.0

0.4

Equities

0.6

2.5

0.1

0.3

Maximum

4.5

5.8

6.2

0.3

Commodities

0.0

0.0

0.0

0.0

Minimum

1.8

2.3

2.2

(0.1)

Total

2.9

4.5

1.8

2.0

Average

2.9

3.3

3.0

(0.3)

(¥ billion)

Fiscal 2016
Daily average

Maximum

Minimum

At March 31

Interest rate

2.0

3.6

1.0

1.0

Foreign exchange

0.5

1.6

0.1

0.1

Equities

0.4

3.2

0.1

0.9

Commodities

0.0

0.0

0.0

0.0

Total

3.3

5.8

2.3

2.6

Daily average

Maximum

Minimum

At March 31

Interest rate

1.7

2.5

1.0

2.2

Foreign exchange

0.4

1.2

0.1

0.1

Equities

0.6

2.4

0.3

0.5

Commodities

0.0

0.0

0.0

0.0

Total

3.0

6.2

2.2

3.0

Fiscal 20172018 Integrated Report118

Appendix

Non-trading activities• VAR does not capture all complex effects of various risk

The VAR related to our banking activities is based on the same

factors on the value of positions and portfolios and could

conditions as those of trading activities, but the holding period is one

underestimate potential losses.

month. In addition, as for risk management of banking activities, it isimportant to properly measure interest rate risk so that we calculate

Cross-shareholdings portfolio management activities

interest risk using appropriate methods such as recognizing demand

We take the market risk management approach with use of VAR anddeposits as “core deposits.”

risk indices for cross-shareholdings portfolio management activities
to properly manage stock price risk. Specifically, we monitor

The following graph shows the VAR related to our banking activities

VAR measurements and the state of risk capital on a daily basis.

excluding our cross-shareholdings portfolio for the year ended March

Moreover, in order to control stock price risk, we are working on the31, 2018:

reduction in cross-shareholdings through careful negotiations withcounterparties.

Fiscal 2017 VAR (banking activities)
Back testing
VAR
Interest rate on five-year government bonds(VAR: ¥ billion)(%)

In order to evaluate the effectiveness of market risk measurements
calculated using the VAR method, we carry out regular back tests to

03/30/2018

03/11/2018

02/20/2018

02/01/2018

model assumptions, we will make adjustments to the models as

01/13/2018-0.3
12/25/2017

VAR through back testing and the results of the evaluation of the0
12/06/2017-0.2

11/17/2017

50

10/29/2017-0.1

10/10/2017

100

09/21/2017

0.0

09/02/20172018 and the corresponding paired distribution of profits and losses.

150

08/14/2017

0.1

07/26/2017

daily VAR of trading activities for the fiscal year ended March 31,

200

07/07/2017

0.2

06/18/2017

250

05/30/2017

0.3

05/11/2017

300

04/22/2017

0.4

04/03/2017

350

compare VAR with assumptive profits and losses. Assumptive profits
and losses accounts for general market risk. The graph below shows

We had zero case where losses exceeded VAR during the period.
In addition, we conduct evaluations of the assumptions related to
the VAR models. Based on the number of times losses exceeded

appropriate. Changes to fundamental portions of the VAR models are
subject to the approval of our Group Chief Risk Officer.

Fiscal 2017 back testing
The following table shows the VAR figures relating to our banking

Assumed profit or loss (¥ billion)
6

activities for the fiscal years indicated:
4

VAR (banking activities)
Fiscal 2015(¥ billion)

Fiscal 2016

Fiscal 2017

ChangeAs of fiscal
year end

321.5

292.7

268.4

(24.3)

Maximum

360.6

397.5

307.2

(90.2)

Minimum

190.0

247.4

210.8

(36.6)

Average

284.9

331.0

267.8

(63.2)

2

0

(2)

(4)

Characteristics of VAR model
VAR is a commonly used market risk management technique.
However, VAR models have the following shortcomings:• By its nature as a statistical approach, VAR estimates possible

(6)

0

1

2

3

4

5
6
VAR (¥ billion)

Note: We conduct our back testing and assess the number of cases where losses exceed
VAR based on a 250 business day year. The expected average number of instanceswhere one-day trading losses exceeded VAR at the 99% confidence level is 2.5.

losses over a certain period at a particular confidence level
using past market movement data. Past market movement,
however, is not necessarily a good indicator of future events,

Stress testing

particularly potential future events that are extreme in nature.

Because the VAR method is based on statistical assumptions, we• VAR may underestimate the probability of extreme market

conduct stress testing to simulate the levels of losses that could

movements.

be incurred in cases where the market moves suddenly to levels• The use of a 99.0% confidence level does not take account of,that exceed these assumptions. The stress testing methods we use

nor makes any statement about, any losses that might occur

include the calculation of losses under scenarios in which stresses

beyond this confidence level.

are applied to interest rate risk and stock price risk based on current
and projected economic conditions, historical market events, etc.

119

Mizuho Financial GroupAppendix Risk management structure

Liquidity risk management
Basic approach
We define liquidity risk as the risk of losses arising from funding

as a whole. Specifically, Mizuho Financial Group establishes thedifficulties due to a deterioration in our financial position that

fundamental liquidity risk management policy for the entire group,

makes it difficult for us to raise necessary funds or that forces

manages the liquidity risk of our principal banking subsidiaries andus to raise funds at significantly higher interest rates than usual.

other core group companies, and monitors how the group’s liquidity

Mizuho Financial Group manages liquidity risk for the Mizuho grouprisk is being managed as a whole.

Liquidity risk management structure
Our Board of Directors determines basic matters pertaining tomatters relating to planning and running cash flow management

liquidity risk management policies. The Risk Management Committee

operations, and the Financial Planning Department is responsibleof Mizuho Financial Group broadly discusses and coordinates

for monitoring and adjusting the cash flow management situation

matters relating to basic policies in connection with liquidity risk

and for planning and implementing cash flow management tomanagement, operations, and monitoring, and proposes responses

maintain appropriate funding liquidity. Reports on liquidity risk

to emergencies such as sudden market changes. The Group Chiefmanagement are submitted to the Risk Management Committee

Risk Officer of Mizuho Financial Group is responsible for mattersand the Balance Sheet Management Committee (each of which is arelating to liquidity risk management planning and operations.

business policy committee), the Executive Management Committee

The Risk Management Department of Mizuho Financial Group is

and the President & Group CEO on a regular basis.

responsible for monitoring liquidity risk, reporting and analysing,making proposals, and formulating and implementing plans relating

Our principal banking subsidiaries and other core group companies

to liquidity risk management. In addition, the Group Chief Financial

also establish their basic policies on liquidity risk management to

Officer of Mizuho Financial Group is additionally responsible forproperly identify and manage liquidity risk.

Liquidity risk management method
We manage liquidity risk with the use of “liquidity risk management

testing to verify the sufficiency of liquidity reserve assets and theindicators” and “liquidity categorization.” The former is determined

effectiveness of countermeasures against a possible outflow of funds

for the purpose of managing limits on funds raised in the market

during a stress event. The results of stress testing are used for cash

considering our fund raising capabilities, and the latter is determinedflow management operations.

based on our funding conditions. We also carry out liquidity stress

Liquidity risk management indicators

Liquidity stress testing

Limits on funds raised in the market are set based on a number of

We carry out stress testing regularly based on market-wide factors,

time horizons taking into account characteristics and strategies ofidiosyncratic factors of the group, and a combination of both types

each of our principal banking subsidiaries and other core groupof factors to verify the sufficiency of liquidity reserve assets and thecompanies. Such limits are discussed and coordinated by theeffectiveness of our liquidity contingency funding plans. Furthermore,

Risk Management Committee, discussed further by the Executive

we utilize stress testing for evaluating the appropriateness of ourManagement Committee, and determined by the President & Groupannual funding plan.

CEO. An excess over any of these limits is immediately reported andaddressed according to a pre-determined procedure.

Liquidity categorization
We have established a group-wide framework of liquidity risk stages
such as “normal,” “anxious” and “crisis,” which reflects funding
conditions. In addition, we set early warning indicators (“EWIs”)
and monitor on a daily basis to manage funding conditions. The
EWIs we use include stock prices, credit ratings, amount of liquidity
reserve assets such as Japanese government bonds, and our funding
situation.

2018 Integrated Report120Appendix

Operational risk management
Basic approach
We define operational risk as the risk of losses that may be incurred

reputational risk, we have separately determined the fundamental

resulting from inadequate or failed internal processes or systems,

risk management policies for these different types of risk. We

human error, or external events. We control operational risk

manage the operational risk associated with our principal banking

management for the Mizuho group as a whole. Considering thatsubsidiaries and other core group companies while monitoring theoperational risk includes information technology risk, operations risk,state of group-wide operational risk.

legal risk, human capital risk, tangible asset risk, regulatory risk, andDefinition

Principal risk management methods

Information
technology risk

Information technology risk (“IT risk”) shall refer to the riskthat problems (e.g. malfunctions, disruptions, etc.) with thecomputer systems or improper use of the computers in thesesystems, which cause disruptions of the services provided tocustomers, or have significant impact on settlement systems,
etc., will result in losses for customers, and the incurrence oflosses (tangible or intangible) by our group companies.

Identify and evaluate the risk by setting specific standards that need
to be complied with and implementing measures tailored based on
evaluation results to reduce the risk.
Ensure ongoing project management in systems development andquality control.
Strengthen security to prevent information leaks.
Strengthen capabilities for rapidly and effectively dealing withcyberattacks.
Improve effectiveness of emergency responses by improving
backup systems and holding drills.

Operations risk

Risk that customers may suffer service disruptions, as well as
the risk that customers or the group may incur losses because
senior executives or employees fail to fulfill their tasks
properly, cause accidents or, otherwise act improperly.

Establish clearly defined procedures for handling operations.
Periodically check the status of operational processes.
Conduct training and development programs led by Head Office.
Introduce information technology, office automation, andcentralization for operations.
Improve the effectiveness of emergency responses by holding drills.

Legal risk

Risk that the group may incur losses due to violation of laws
and regulations, breach of contract, entering into improper
contracts or, other legal factors.

 eview and confirm legal issues, including the legality of materialR
decisions, agreements and external documents, etc.
Collect and distribute legal information and conduct internal training
programs.
Analyze and manage issues related to lawsuits.

Human capital risk

Risk that the group may incur losses due to turnover or lossof personnel, deterioration of morale, inadequate
development of personnel, inappropriate working schedules,
inappropriate working and safety environment, inequality or
inequity in human resource management, or discriminatory
conduct.

Conduct employee satisfaction surveys.
Understand the status of working hours.
Understand the status of vacation days taken by personnel.
Understand the status of voluntary resignations.
Understand the status of the stress check system.

Tangible asset risk

Risk that the group may incur losses from damage to tangible
assets or a decline in the quality of the working environment
as a result of disasters, criminal actions, or defects in asset
maintenance.

 anage the planning and implementation of construction projects
M
related to the repair and replacement of facilities.
Identify and evaluate the status of damage to tangible assets caused
by natural disasters or other causes, and respond appropriately tosuch damage.

Regulatory risk

Risk that the group may incur losses due to changes invarious regulations or systems, such as those related to law,
taxation, and accounting.

 nderstand important changes in regulations or systems that haveUsignificant influence on our business operations or financial
condition in a timely and accurate manner.
Analyze degree of influence of regulatory changes and establish
countermeasures.
Continuously monitor our regulatory risk management mentioned
above.

Reputational risk

Risk that the group may incur losses due to damage to ourcredibility or the value of the “Mizuho” brand when market
participants or others learn about, or the media reports on,
various adverse events, including actual materialization ofrisks or false rumors.

 stablish framework to identify and manage, on an integrated basis,E
information that may have a serious impact on group management
and respond to such risk in a manner appropriate to its scale andnature.
Swiftly identify rumors and devise appropriate responses dependingon the urgency and possible impact of the situation to minimize
possible losses.

We also recognize and manage information security risk and compliance risk, which constitute a combination of more than one of the above components, as operational
risk.

121

Mizuho Financial GroupAppendix Risk management structure

Operational risk management structure
Our Board of Directors determines basic matters pertaining tomarket risk, reporting and analysing, making proposals, setting limits

operational risk management policies. The Risk Management

and guidelines, and formulating and implementing plans relating toCommittee of Mizuho Financial Group broadly discusses andoperational risk management.

coordinates matters relating to basic policies in connection with
operational risk management, operational risk operations, andOur principal banking subsidiaries and core group companies

operational risk monitoring. The Group Chief Risk Officer of Mizuho

establish their basic policies on operational risk management, andFinancial Group is responsible for matters relating to operational

their Boards of Directors determine important matters relating torisk management planning and operations. The Risk Management

operational risk management.

Department of Mizuho Financial Group is responsible for monitoring

Operational risk management method
To manage operational risk, we set common rules for data gatheringsophistication and diversification of financial operations andto develop various databases shared by the group and measuredevelopments relating to information technology by utilizing control

operational risk as operational VAR on a regular basis, taking into

self-assessments and improving measurement methods.

account possible future loss events and changes in the businessenvironment and internal management.

Control self-assessments
An autonomous method of risk management in which risk inherent

We have established and are strengthening management methods

in operations is identified and, after evaluating and monitoringand systems to appropriately identify, assess, measure, monitor,risks that remain despite implementing risk control, the necessary

and control the operational risks that arise from the growing

measures are implemented to reduce risk.

Definition of risks and risk management methods
As shown in the table on the previous page, we have definedmanagement methods in accordance with the scale and nature ofeach component of operational risk, and we apply appropriate riskeach risk.

Measurement of operational risk equivalent
1. Implementation of the Advanced Measurement Approach(AMA)
We have adopted the AMA for the calculation of operational risk
equivalent in association with capital adequacy ratios based on the
Basel Accords. However, we use the Basic Indicator Approach forentities that are deemed to be less important in the measurementof operational risk equivalent. Entities within our group that use the
AMA include the following: Mizuho Financial Group; Mizuho Bank,
Ltd., Mizuho Trust & Banking Co., Ltd.; Mizuho Securities; Mizuho
Information & Research Institute, Inc.; Trust & Custody Services Bank,
Ltd.; Mizuho Operation Service, Ltd.; Mizuho Credit Guarantee Co.,
Ltd.; Mizuho Business Service Co., Ltd.; Mizuho Trust Operations
Co., Ltd.; Mizuho Trust Systems Co., Ltd.; Mizuho Trust Business
Operations Co., Ltd.; Mizuho Trust Retail Support Co., Ltd.; Mizuho
Bank Europe N.V.; and Mizuho International plc.

2. Outline of the AMA
Outline of the measurement system 
We have established our model by taking account of four elements:
internal loss data; external loss data; scenario analysis and businessenvironment; and internal control factors (BEICFs). We calculate
the operational risk amount by estimating the maximum loss,
using a 99.9th percentile one-tailed confidence interval and a oneyear holding period as operational risk equivalent, employing bothinternal loss data (i.e., actually experienced operational loss events),
and scenario data to reflect unexperienced potential future loss
events in the measurement.
In the measurement of operational risk equivalent as of March 31,
2018, we did not exclude expected losses and also did not recognize
the risk mitigating impact of insurance. In addition, we did not take
into account the events related to credit risk in measuring operational

The measurement results under the AMA are used not only as therisk equivalent.

operational risk equivalent in the calculation of capital adequacy
ratios but also as Operational VAR for internal risk management
purposes for implementing action plans to reduce operational risk,
and other countermeasures.

2018 Integrated Report122Appendix

Outline of measurement model 

Estimation of Frequency Distribution and Loss Severity

Operational risk equivalent is calculated as a simple sum of those risk

Distribution 

amounts related to the seven loss event types defined in the CapitalFrequency Distribution is estimated by applying information on

Adequacy Notice from Japan’s Financial Services Agency, large-scaleoccurrence frequency of both internal loss data and scenario data tonatural disasters, and litigation. In the measurement of operational

Poisson Distribution. Loss Severity Distribution is generated as therisk equivalent as of March 31, 2018, we did not reflect the correlation

result of combining, through a statistical approach (Extreme Valueeffects among operational risk related to each of the seven loss event

Theory), of the actual distribution for the low severity distribution

types.

portion created by internal loss data and another loss distribution(Log-normal Distribution or Generalized Pareto Distribution) for thehigh severity distribution portion created by scenario data.

Operational risk by loss event type 
Loss Distribution (Compound Poisson Distribution) Approach (LDA)
is adopted for the calculation of operational risk. LDA is based on
the assumption that Poisson Distribution applies to the occurrence
frequency of operational risk events, and loss severity is expressed
through a separate distribution. Operational risk is calculated foreach of the seven loss event types employing both internal loss
data, based on our actual experience as operational loss events,and scenario data. Scenario data, expressed as numerical values ofoccurrence frequency and loss severity, reflects external loss data
and BEICFs, in order to estimate unexperienced potential future loss
events (of low frequency and high severity).
Frequency Distribution and Severity Distribution are estimatedemploying the above mentioned internal loss data and scenario data,
and Monte-Carlo simulations are then applied to these distributions
to measure operational risk. The detailed steps of creation of scenario
data are explained later in the Scenario Analysis.

Outline of measurement modelInternal loss data

Business environment andinternal control factors

External loss data

Scenario analysis

Scenario data

Litigation data

Risk amount for litigation risk

Large-scale natural
disaster scenario data

Risk amount for large-scale
natural disasters

Risk amount for internal fraud

Distribution of
scenario data

Unifieddistribution

Frequency
distribution
information

Frequency
distribution
information

Frequency
distribution
information

Loss severity
distribution
information

Loss severity
distribution
information

Loss severity
distribution
information

Risk amount for external fraud

Loss distribution
Monte-Carlo simulation

Distribution ofinternal loss

Risk amount for employment
practices and workplace safety
Risk amount for customers,
products, and business practices
Risk amount for damage tophysical assets

Risk amountCalculate risk amountby seven loss event
types defined by BIS

Risk amount for businessdisruption and system failure
Risk amount for execution,delivery, and process management

Operational VAR(Total operational risk amount)

123

Mizuho Financial GroupAppendix Risk management structure

Operational risk of large-scale natural disasters 

Setting units for scenario analysis Monte-Carlo simulation is applied to the datasets expressed as a

In order to ensure completeness and sufficiency, we set units thatcombination of the probability of occurrence of large-scale natural

are commonly applied across group entities that adopt AMA (thedisasters and the probable loss amount in case of such occurrence,“Group Entities”) by referencing and categorizing risk scenarios

as opposed to estimating Frequency Distribution and Loss Severity

recognized through control self-assessment, internal loss data ofDistribution.

the Group Entities, external loss data, etc. Then each of the Group
Entities selects the unit on which scenario analysis is conducted fromOperational risk of litigation 

the units established on a group-wide basis in accordance with its

Each litigation is converted into data according to the profile of thebusiness activities and operational risk profile.

individual litigation to which Monte-Carlo simulation is applied, as
opposed to estimating Frequency Distribution and Loss Severity

Estimation of occurrence frequency Distribution. In the measurement process, we assume that final

Basic occurrence frequency (once a year) is calculated for eachdecisions will be made on all litigation within one year.

scenario analysis unit. If a certain scenario analysis unit has relevantinternal loss data of a pre-determined threshold amount or above,

Verification 

its basic occurrence frequency is calculated based on such data, andWe confirm the appropriateness of the measurement model by

if not, the basic occurrence frequency (the occurrence frequency perverifying it, in principle, semi-annually.

year of losses at or above a pre-determined threshold) is calculatedwith reference to the situation of occurrence of internal loss data of

3. Scenario analysis
Outline of scenario analysis In the process of scenario analysis, scenario data is created as
numerical values of occurrence frequency and loss severity reflecting
external loss data and BEICFs, in order to estimate unexperienced
potential future operational risk events (of low frequency and highseverity).

less than the threshold amount and/or external loss data. The basic
occurrence frequency is then adjusted within a pre-determined range
for the purpose of reflecting the most recent BEICFs to determine thefinal occurrence frequency.
Estimation of Loss Severity Distribution 
In order to estimate Loss Severity Distribution, we use a predetermined series of severity ranges. Basic Loss Severity Distribution

As for external loss data, we refer to data publicly reported byis calculated for each scenario analysis unit as an occurrence ratio

domestic and overseas media, and such data are reflected in the(in percentile figures) of loss at each severity range when losses

estimation of occurrence frequency and Loss Severity Distribution inat or above a pre-determined threshold occurred, with reference

the process of scenario analysis. In addition, BEICFs are utilized as

to transaction amount data, external loss data, etc. Then the basic

indices to adjust occurrence frequency and Loss Severity Distribution

severity distribution is adjusted, if necessary, from the viewpointin the process of scenario analysis.

of statistical data processing to determine the final Loss Severity
Distribution.

We categorize scenario analysis into four approaches in accordancewith the characteristics of each loss event type and risk management

Creation of scenario data 

structures.

For each scenario analysis unit, scenario data is generated as a seriesof combinations of occurrence frequency per year at each severity

Approach

Loss event type(s) to be applied

A

Internal fraud / external fraud / clients, products, and businesspractices / execution, delivery, and process management

B

Employment practices and workplace safety

C

Damage to physical assets

D

Business disruption and system failure

range, based on the final occurrence frequency and the final Loss
Severity Distribution.

Example of scenario data
Final loss severity distribution
Severity range (¥ billion)

At Mizuho Financial Group, loss event types to which Approach A isapplied account for a considerable amount of operational risk. The
detailed process of Approach A is explained here as a typical exampleof scenario analysis.

0.1

0.5

1

5

Total

10

Occurrence ratio (%)

40

30

15

10

5

100

Occurrence frequency(times)

0.4

0.3

0.15

0.1

0.05

1

Final occurrence frequency(As of July 1, 2018)2018 Integrated Report124Appendix

Business continuity management

In light of our social responsibility and the important role

These offices function as a controller in the event of an

Mizuho plays within the social infrastructure as a financial

emergency that may materially impact business management,

institution, ensuring the continuity of financial settlementby collecting and analyzing information, formulating

functions and the swift and efficient recovery of operations incountermeasures, and taking other necessary action. In

the event of an emergency is one of our top priorities within

addition, their role includes collecting and analyzing signs andthe group.

indicators of a potential crisis, and reporting their findings
promptly to management.

To improve business continuity management practices acrossthe group, we assess the potential impact of emergencies

Particular focus is placed on strengthening our response to

beforehand and formulate necessary countermeasures in ordernatural disasters, covering not only earthquakes and tsunamis

to minimize such impact, and to ensure the swift and efficient

but also volcanic eruptions, large-scale wind or water damage,recovery of operations.

and facilitating initial responses to acts of terrorism and riots.
We also focus on responses to cyberattacks that have been

One of the ways in which we are working to achieve this isoccurring with increasing frequency around the world.

by establishing Crisis Management Offices within Mizuho

125

Financial Group, Mizuho Bank, Mizuho Trust & Banking, andAlso, to secure the effectiveness of our measures to deal with

Mizuho Securities that are responsible for business continuity

emergencies, group-wide practice drills and training sessions

management and our responses in the event of emergency.

are conducted on an annual basis.

Mizuho Financial GroupSenior executives

Mizuho Financial Group
Members of the Board of Directors
Executive officers as defined in
the Companies Act
Tatsufumi Sakai

Goji Fujishiro

Toshio Sobue

Head of Global Products Unit

Deputy Head of Risk Management Group and Deputy
Head of Compliance GroupManaging Executive Officer

Shuji Kojima
Managing Executive Officer
Head of Human Resources Group (Group CHRO)

Managing Executive Officer

Hiroaki Ehara

Managing Executive Officer

Deputy Head of Human Resources Group and Deputy
Head of Internal Audit Group

Member of the Board of Directors
President & CEO(Representative Executive Officer)
Group CEO

Executive officers as defined in
our internal regulations andspecialist officers

Takanori Nishiyama

Satoshi Miyazaki

Masashi Hara

Head of Compliance Group (Group CCO)

In charge of Western Japan (Kinki, Chugoku, andShikoku regions)

Deputy Head of Global Products Unit

Makoto Umemiya

Takeshi Watanabe

Member of the Board of Directors
Managing Executive Officer

Member of the Board of Directors
Managing Executive Officer

Head of Financial Control & Accounting Group (Group CFO)

Yasuyuki Shibata

Member of the Board of Directors
Managing Executive Officer

Head of Risk Management Group (Group CRO)

Hisashi Kikuchi

Member of the Board of Directors
Managing Executive Officer

Head of Strategic Planning Group (Group CSO)

Yasuhiro Sato

Deputy President & Executive Officer

Senior Managing Executive Officer
In charge of Specific Duties

Daisuke Yamada

Senior Managing Executive Officer

Yoshihito BandoManaging Executive Officer

Deputy Head of Asset Management Company

Managing Executive Officer

Keisuke Saito

Managing Executive Officer

Deputy Head of Global Products Unit

Hiroshi Itabashi

Managing Executive Officer

Chief Digital Innovation Officer

Deputy Head of Corporate & Institutional Company
and Deputy Chief Digital Innovation Officer

Teiji Teramoto

Toshiro Egawa

Head of the Americas

Deputy Head of Retail & Business Banking Company

Senior Managing Executive Officer

Managing Executive Officer

Haruki Nakamura

Naoyuki Machinaga

Joint Head of IT & Systems Group

Deputy Head of Research & Consulting UnitManaging Executive Officer

Managing Executive Officer

Member of the Board of Directors, Chairman

Koji Arita

Masao Kanamaru

Ryusuke Aya

Joint Head of Operations Group

Shingo Asano

Deputy Head of Global Corporate Company, Deputy
Head of Global Markets Company and Deputy Headof Global Products Unit

In charge of Specific Business of Retail & Business Banking Company

Naofumi Fuke

Tetsuo Seki

Takahiko Yasuhara

Deputy Head of Retail & Business Banking Company

Takashi Kawamura

Head of East Asia

Atsushi Takahashi

Koji Yonei

Deputy Head of Global Markets Company

Member of the Board of Directors

Nobukatsu Funaki

Member of the Board of Directors
Member of the Board of Directors (Outside Director)
Member of the Board of Directors (Outside Director)

Managing Executive Officer

Managing Executive Officer

Managing Executive Officer

Tatsuo Kainaka

Managing Executive Officer

Member of the Board of Directors (Outside Director)

Joint Head of IT & Systems Group and General
Manager of IT & Systems Promotion Department

Hirotake Abe

Masatoshi Yoshihara

Member of the Board of Directors (Outside Director)

Managing Executive Officer

Managing Executive Officer

Managing Executive Officer

Toshio Hirota

Managing Executive Officer

Deputy Head of Corporate & Institutional Company

Managing Executive Officer

Tatsuya Yamada

Hisaaki Hirama

Deputy Head of Financial Control & Accounting
Group and Deputy Head of IT & Systems GroupManaging Executive Officer

Hiroko Ota

Deputy Head of Global Markets Company

Izumi Kobayashi

Managing Executive Officer

Member of the Board of Directors (Outside Director)

Deputy Head of Internal Audit Group

Masaya Oishi

Toshitsugu Okabe

Naoto Takahashi

Deputy Head of Asset Management Company

Member of the Board of Directors (Outside Director)

Deputy President & Executive Officer(Representative Executive Officer)

Managing Executive Officer

Managing Executive Officer

Taiji Kumagai

Head of Retail & Business Banking Company

In charge of Specific Duties of Strategic PlanningGroup and General Manager of Next–Generation IT
Systems Coordination Project Team

Daisaku Abe

Hiroshi Nagamine

Kenji Fujii

Deputy President & Executive Officer

Managing Executive Officer

Head of IT & Systems Group (Group CIO) and Headof Operations Group (Group COO)

Head of Europe, Middle East and Africa

Junichi KatoManaging Executive Officer

Senior Managing Executive Officer
Head of Global Markets Company

Katsunobu Motohashi

Senior Managing Executive Officer

Head of Asset Management Company

Akira Nakamura

Senior Managing Executive Officer

Head of Corporate & Institutional Company

Seiji Imai

Senior Managing Executive Officer
Head of Global Corporate Company

Tsutomu Nomura

Managing Executive Officer

Head of Internal Audit Group (Group CA)

Motonori Wakabayashi

Managing Executive Officer

Head of Research & Consulting Unit

Riki Shibata

Deputy Head of Global Markets Company

Hidenobu Mukai

Managing Executive Officer

In charge of Specific Business of Retail & Business Banking Company

Managing Executive Officer

Deputy Head of Compliance GroupManaging Executive Officer

Deputy Head of Research & Consulting Unit and
Deputy Head of Risk Management Group

Hideyuki Kawashima

Managing Executive Officer

Deputy Head of Internal Audit Group

Yuzo Kanamori

Managing Executive Officer

Head of Asia & Oceania excl. East Asia

Deputy Head of Global Corporate Company, Deputy
Head of Global Products Unit, Deputy Head of
Strategic Planning Group, Deputy Head of Operations
Group and Deputy Chief Digital Innovation Officer

Akihito Mochizuki

Yasuto Hamanishi

In charge of Specific Duties of Strategic Planning Group

Deputy Head of Global Corporate Company and
Deputy Head of Global Products Unit

Hidekatsu TakeManaging Executive Officer

Managing Executive Officer

Kazuhisa Sawa

Managing Executive Officer

Deputy Head of Strategic Planning Group, Deputy
Head of Financial Control & Accounting Group,
Deputy Head of IT & Systems Group and Deputy
Head of Operations GroupManaging Executive Officer

Kenji Tsujitsugu

Managing Executive Officer

Deputy Head of Corporate & Institutional Company

Takafumi Matake

Managing Executive Officer

Deputy Head of Human Resources Group2018 Integrated Report126

Asashi Katou

General Manager for IT & Systems Group

Eishi Shimizu

Toshio Kinoshita

Executive Officer

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Bo Kusanagi

Seiji Koga

General Manager of Channel Strategy Department

Naofumi Fuke*
Deputy President

Head of Retail & Business Banking Division

Atsushi Takahashi*
Deputy President

Head of Global Markets Division and Head of Global Markets

Toshio Hirota*

Executive Officer

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Hiroyuki Iijima

Executive officers(Head of each region outside Japan)

Tatsuya Yamada*

Teiji Teramoto

Head of Financial Control & Accounting Group, Headof IT & Systems Group, Head of Global Finance andHead of Global IT

General Manager of Asset Management Coordination Department

Executive Officer

General Manager of Retail & Business Banking
Coordination Department

Masaomi Takada
Executive Officer

General Manager of Executive Secretariat

Shinya Uda

Senior Managing Executive Officer
Head of the Americas

Takahiko YasuharaManaging Executive Officer

Senior Executive Managing Director

Head of Global Investment Banking Division

Senior Executive Managing Director(Representative Director)

Masaya Oishi*

Executive Managing Director

Head of East Asia

Head of Fund Business Division and In charge of JA
Sales Dept. of Global Markets Division

Hiroshi Nagamine

Taiji Kumagai*

Head of Europe, Middle East and Africa

Head of Compliance Group and Head of Global Compliance

General Manager of Accounting Department

Hidekatsu Take

Kenji Fujii*

Masahiko Kato

Head of Asia & Oceania excl. East Asia

Head of Research & Consulting Unit, Head of Risk
Management Group, In charge of Due Diligence Dept.
and Head of Global Risk Management

Executive Officer

General Manager of Global Talent Planning andManagement Department

Masahiro Kosugi
Executive Officer

Specialist Officer

General Manager for IT & Systems Group

Yasumasa Mukai
Specialist Officer

General Manager for IT & Systems Group

Mizuho Bank
Members of the Board of Directors
Nobuhide Hayashi
Chairman

Koji Fujiwara*

President & CEO (Representative Director)

Satoshi Miyazaki*

Deputy President (Representative Director)
In charge of Western Japan (Kinki, Chugoku, andShikoku regions)

Kiyoshi Miyake*

Deputy President (Representative Director)
Head of Business Promotion

Shusaku Tsuhara*

Deputy President (Representative Director)
Head of Business Promotion

Managing Executive Officer

Managing Executive Officer

Mizuho Trust & Banking
Members of the Board of Directors
Takeo Nakano
Chairman

Tetsuo Iimori*President & CEO (Representative Director)

Kazuhisa Sawa*

Deputy President (Representative Director)

Head of Strategic Planning, Financial Control &Accounting Group, Head of IT & Systems Group, Headof Operations Group and In charge of Executive Secretariat

Toshio Sobue*

Executive Managing Director

Head of Risk Management Group and Head ofCompliance Group

Hiroaki Ehara*

Executive Managing Director

Head of Human Resources Group and Head of Internal Audit Group

Tatsufumi Sakai

Member of the Board of Directors

Masaru Ono

Executive Managing Director

Executive Managing Director

Hideyuki Kawashima*

Executive Managing Director

Head of Internal Audit Group and SC Group Chief
Audit Executive

Yuzo Kanamori*Executive Managing Director

Head of Strategic Planning Group, Head ofOperations group, In charge of Investment Dept. andIn charge of Markets Strategic Intelligence Dept.

Tatsufumi Sakai
Member of the Board of Directors

Hidetaka Kawakita
Member of the Board of Directors (Outside Director)

Yasushi Higo

Member of the Board of Directors (Audit &Supervisory Committee Member)

Hiroki Takeshi

Member of the Board of Directors (Audit &Supervisory Committee Member)

Hideo Etani

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Takanori Nishiyama*

Member of the Board of Directors (Outside Director)

Head of Compliance Group

Member of the Board of Directors (Outside Director)

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Masato Monguchi

Masaru Ono

Executive Managing Director

Makoto Umemiya*

Executive Managing Director

Eiji Ogawa

Head of Financial Control & Accounting Group

Member of the Board of Directors (Audit &Supervisory Committee Member)

Yasuyuki Shibata*

Hiroyuki Hatano

Head of Risk Management Group

Member of the Board of Directors (Audit &Supervisory Committee Member)

Hisashi Kikuchi*

Masayuki Satake

Executive Managing Director

Head of Strategic Planning Group

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Tatsufumi Sakai

Kiyotaka Fuke

Executive Managing Director

Member of the Board of Directors

Masayuki Yonetani

Member of the Board of Directors (Audit &Supervisory Committee Member)

Koji Nishiwaki

Member of the Board of Directors (Audit &Supervisory Committee Member)

Kazutoshi Narita

Member of the Board of Directors (Audit &Supervisory Committee Member)

Yukio Machida

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

127

Shigeo Ohara

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Executive Officer

Mizuho Financial Group

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Ryuta Nakajima

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)

Mizuho Securities
Members of the Board of Directors
Kosuke Nakamura
Chairman

Koichi Iida*

President & CEO (Representative Director)

Yuji Yoshimasu

Member of the Board of Directors (Outside Director)(Audit & Supervisory Committee Member)
Notes:

1. * indicates directors concurrently serving as
executive officers.
2. E
 xecutive officers, excluding the directors
concurrently serving as executive officers andexecutive officers responsible for global regional
operations of Mizuho Bank, have not been listed.
3. Executive officers, excluding the directors
concurrently serving as executive officers ofMizuho Trust & Banking and Mizuho Securities,
have not been listed.
(As of June 22, 2018)

Location of offices outside Japan (As of June 30, 2018)
Network of Mizuho Bank
Asia and Oceania(Country/Region)
Australia
Sydney Branch
Level 33, 60 Margaret Street, Sydney, N.S.W. 2000, Australia
TEL 61-2-8273-3888

Mizuho Australia Ltd.

Level 33, 60 Margaret Street, Sydney, N.S.W. 2000, Australia
TEL 61-2-8273-3888

Cambodia

Phnom Penh Branch
13A Floor, Phnom Penh Tower, #445,
Monivong Blvd (St. 93/232) Sangkat Boeung Pralit,
Khan 7 Makara, Phnom Penh, Cambodia
TEL 855-23-964-490

China

Mizuho Bank (China), Ltd.
23rd Floor, Shanghai World Financial Center,
100 Century Avenue, Pudong New Area, Shanghai
200120, The People’s Republic of China
TEL 86-21-3855-8888

Mizuho Bank (China), Ltd.
Shanghai Pilot Free Trade Zone Sub-Branch
Room 01, 08, 09, 10, 11, 12, 7F, Shanghai International
Communication and Trade Building, 55 Jilong Road,
Shanghai 200131, The People’s Republic of China
TEL 86-21-3855-8888

Mizuho Bank (China), Ltd.
Beijing Branch

8th Floor, West Wing, World Financial Center,
No. 1 Dong San Huan Zhong Road, Chaoyang District,
Beijing 100020, The People’s Republic of China
TEL 86-10-6525-1888

Mizuho Bank (China), Ltd.
Dalian Branch

23rd Floor, 24th Floor-A, Senmao Building,
147 Zhongshan Road, Xigang District,
Dalian, Liaoning Province 116011,
The People’s Republic of China
TEL 86-411-8360-2543

Mizuho Bank (China), Ltd.
Guangzhou Branch

25th Floor, International Finance Place, No. 8 Huaxia Road,
Zhujiang New Town, Tianhe District, Guangzhou,
Guangdong Province 510623,
The People’s Republic of China
TEL 86-20-3815-0888

Mizuho Bank (China), Ltd.
Hefei Branch

Room No. 1902-1907, No. 7 Office Building Wanda Plaza,
130 Maanshan Street, Baohe District, Hefei,
Anhui Province, The People’s Republic of China
TEL 86-551-6380-0690

Mizuho Bank (China), Ltd.
Qingdao Branch

44th Floor, Qingdao International Finance Center,
59 Hong Kong Middle Road, Shinan District, Qingdao,
Shandong Province 266071,
The People’s Republic of China
TEL 86-532-8097-0001

Mizuho Bank (China), Ltd.
Shenzhen Branch

30th Floor, Huanggang Business Center Tower1,
Jintian Road, Futian District, Shenzhen,
Guangdong Province 518046,
The People’s Republic of China
TEL 86-755-8282-9000

Mizuho Bank (China), Ltd.
Suzhou Branch

India
Bangalore-Devanahalli BranchSuzhou Industrial Park, Suzhou, Jiangsu Province 215123,
The People’s Republic of China
TEL 86-512-6733-6888#462/440/339, 2nd Floor, Near Jain Temple, N.H.7/4-207,
B.B. Road, Vijayapura Cross, Devanahalli Town,
Bangalore Rural District - 562 110, Karnataka, India
TEL 91-80-4968-2000

Mizuho Bank (China), Ltd.
Tianjin Branch

Chennai Branch

17th Floor, Genway Building, 188 Wangdun Road,

5th Floor, E2 ABC, East Wing Binhai Finance Zone,
No. 20 Xinchengdong Road, TEDA, Tianjin 300457,
The People’s Republic of China
TEL 86-22-6622-5588

Mizuho Bank (China), Ltd.
Wuhan Branch

5th Floor, Tower A, New World Center Tower,
634 Jiefang Avenue, Hankou, Wuhan,
Hubei Province 430032,
The People’s Republic of China
TEL 86-27-8342-5000

Mizuho Bank (China), Ltd.
Wuxi Branch

8th Floor, Wuxi SI Park B, No. 16 Changjiang Road,
WND, Wuxi, Jiangsu Province 214028,
The People’s Republic of China
TEL 86-510-8522-3939

Mizuho Bank (China), Ltd.
Changshu Sub-Branch

Room701-704, Kechuang Building, No. 333 Dongnan Road,
Changshu New & Hi-tech Industrial Development Zone,
Jiangsu Province, 215500, The People’s Republic of China
TEL 86-512-6733-6888

Mizuho Bank (China), Ltd.
Dalian Economic & Technological
Development Area Sub-Branch

22nd Floor, International Business Building of Gugeng,
No. 81 Hongmei Area, Dalian Economic & Technological
Development Area, Dalian, Liaoning Province 116600,
The People’s Republic of China
TEL 86-411-8793-5670

Mizuho Bank (China), Ltd.
Kunshan Sub-Branch

Room D,E, 18th Floor, Dongan Building,
No. 258 Chunxu Road, Development Zone Kunshan City,
Kunshan, Jiangsu Province 215300,
The People’s Republic of China
TEL 86-512-6733-6888

Mizuho Bank (China), Ltd.
Tianjin Heping Sub-Branch

Room 1902, Tianjin International Building,No. 75 Nanjing Road, Heping Area, Tianjin 300050,
The People’s Republic of China
TEL 86-22-6622-5588

Nanjing Representative Office

Room 2220, Suning Universal Hotel, 188 Guangzhou Road,
Nanjing, Jiangsu Province 210024,
The People’s Republic of China
TEL 86-25-8332-9379

Xiamen Representative Office

Room 2102, The Bank Center, No. 189 Xiahe Road,
Siming District, Xiamen, Fujian Province 361003,
The People’s Republic of China
TEL 86-592-239-5571

Hong Kong

Hong Kong Branch
13/F, K11 Atelier, 18 Salisbury Road Tsim Sha Tsui,
Kowloon Hong Kong, S.A.R.,
The People’s Republic of China
TEL 852-2306-5000

Mizuho Capital Markets (HK) Limited

12/F, K11 Atelier, 18 Salisbury Road, Tsim Sha Tsui,
Kowloon, Hong Kong, S.A.R.,
The People’s Republic of China
TEL 852-2306-5781

Unit No. 11B, 11th Floor, Prestige Palladium Bayan,Nos. 129 to 140, Greams Road, Chennai – 600 006,
Tamil Nadu, India
TEL 91-44-4928-6600

Mumbai Branch

Level 17 TOWER–A Peninsula Business Park,
Senapati Bapat Marg, Lower Parel, Mumbai 400013, India
TEL 91-22-4911-2000

New Delhi Branch

1st Floor, DLF Capitol Point, Baba Kharag Singh Marg,
Connaught Place, New Delhi, 110001, India
TEL 91-11-3041-0900

Ahmedabad Branch

Office No. 402, 4th Floor, Commerce House–5,
Nr. Vodafone House, Prahladnagar Corporate Road,
Prahladnagar Satellite, Ahmedabad–380 051, India
TEL 91-79-4014-4666

Indonesia
PT. Bank Mizuho Indonesia
Sinar Mas Land Plaza Menara 2, 24th Floor,
Jl. M. H. Thamrin No. 51, Jakarta 10350,
Republic of Indonesia
TEL 62-21-392-5222

Korea
Seoul Branch
19th Floor, Seoul Finance Center, 136, Sejong-daero,Jung-gu, Seoul, Korea
TEL 822-3782-8500

Malaysia
Labuan Branch
Level 9 (B) & (C), Main Office Tower,
Financial Park Labuan, Jalan Merdeka,
87000 Federal Territory of Labuan, Malaysia
TEL 60-87-417766

Labuan Branch, Kuala Lumpur
Marketing Office

Level 27, Menara Maxis, Kuala Lumpur City Centre,
50088 Kuala Lumpur, Malaysia
TEL 60-3-2070-6880

Mizuho Bank (Malaysia) Berhad

Level 27, Menara Maxis, Kuala Lumpur City Centre,
50088 Kuala Lumpur, Malaysia
TEL 60-3-2058-6881

Myanmar
Yangon Branch
Sedona Business Suites, Level 4,
No. 1 Ka Ba Aye Pagoda Road, Yankin Township, Yangon,
Republic of the Union of Myanmar
TEL 95-1-860-5501

Yangon Branch Thilawa Front Office

Room No. 204, Administration Building,Corner of Thilawa Development Road and Dagon-Thilawa
Road, Thilawa SEZ, Thanlyin Township, Yangon,
Republic of the Union of Myanmar
TEL 95-1-230-9046

Philippines
Manila Branch
25th Floor, Zuellig Building, Makati Avenue corner Paseo deRoxas, Makati City 1225, Metro Manila, Philippines
TEL 63-2-860-3500

India

2018 Integrated Report128Singapore
Singapore Branch
12 Marina View, #08-01 Asia Square Tower 2,
Singapore 018961, Republic of Singapore
TEL 65-6805-2000

TaiwanKaohsiung Branch
12th Floor, No. 2, Chung Cheng 3rd Road,
Kaohsiung 800, Taiwan
TEL 886-7-236-8768

Taichung Branch

8th Floor, No. 169, Fuhui Parkway, Taichung 407, Taiwan
TEL 886-4-2374-6300

Taipei Branch

8-9th Floor, Cathay Landmark Square,
68 Zhong Xiao East Road, Xinyi District,Taipei, Taiwan
TEL 886-2-8726-3000

Thailand

Bangkok Branch
98 Sathorn Square Office Tower 32nd – 35th floor,
North Sathorn Road, Silom, Bangrak, Bangkok 10500,
ThailandTEL 66-2-163-2999, 2-002-0222

Eastern Seaboard Branch

300/7 ESIE Plaza 2, Unit No. 2-05 Moo 1, Tambol Ta Sit,
Amphoe Pluak Daeng, Rayong 21140, Thailand
TEL 66-3-899-7000

VietnamHanoi Branch
4th Floor, 63 LTT Building, 63 Ly Thai To Street, Hanoi,
Socialist Republic of Vietnam
TEL 84-24-3936-3123/3124

Ho Chi Minh City Branch

18th Floor, Sun Wah Tower,
115 Nguyen Hue Boulevard, District 1,
Ho Chi Minh City, Socialist Republic of Vietnam
TEL 84-28-3827-8260/8292

Europe, the Middle East and Africa(Country/Region)

AustriaMizuho Bank Europe N.V.
Vienna Branch

DC Tower 26th Floor, Donau-City-Strasse 7,1220 Vienna, Austria
TEL 43-1-269-1000-00

Bahrain

Bahrain Representative Office
Suite 201-202, Entrance 4, 2nd Floor, Manama Center,
Manama, Bahrain(P.O. BOX 5759, Manama, Bahrain)
TEL 973-17-224522

BelgiumMizuho Bank Europe N.V.
Brussels Branch

Avenue Louise 480, 1050 Brussels, Belgium
TEL 32-2-645-5280

FranceParis Branch
Washington Plaza 40, rue Washington,
75408 Paris Cedex 08, France
TEL 33-1-5383-4000

Germany

Duesseldorf Branch
Benrather Strasse 18-20, 40213 Duesseldorf, F.R. Germany
TEL 49-211-13020

129

Mizuho Financial GroupFrankfurt Branch

TaunusTurm 34th Floor, Taunustor 1, 60310 Frankfurt am
Main, Germany
TEL 49-69-29-72-95-0

Iran

The Americas(Country/Region)
BahamasMizuho Bank (USA) Nassau Branch

Tehran Representative Office

308 East Bay Street, P.O. Box N-7768, Nassau, Bahamas

3rd Floor, No. 1, 14th Street, Khaled Eslamboli Avenue,
Tehran 15117, IranTEL 98-21-8872-6593

BrazilBanco Mizuho do Brasil S.A.

Italy

Milan Branch
6th Floor, Largo Augusto 7, 20122 Milan, Republic of Italy
TEL 39-02-778-0001

Saudi Arabia

Mizuho Saudi Arabia Company
North Lobby 1st Floor, Al Faisaliah Tower,
King Fahd Road, Olaya District, Riyadh 11544,
Kingdom of Saudi Arabia
TEL 966-11-273-4111

South Africa
Johannesburg Representative Office
2nd Floor, West Tower, Maude Street,
Nelson Mandela Square, Sandton 2196, South Africa,
P.O. Box 785553, Sandton 2146
TEL 27-11-881-5410

Spain
Mizuho Bank Europe N.V.
Madrid Branch

Calle Orense 34, Planta 6, Edificio Iberia Mart II,
28020 Madrid, SpainTEL 34-91-598-2905

The Netherlands

Mizuho Bank Europe N.V
Apollolaan 171, 1077 AS Amsterdam, The Netherlands
TEL 31-20-5734343

TurkeyIstanbul Representative Office
Office 813, Tekfen Tower 8th Floor,
Buyukdere Caddesi No. 209, 4. Levent 34394, Istanbul,
TurkeyTEL 90-212-371-8474

UAE
DIFC Branch-Dubai
The Gate Building, East Wing, Level 5, Dubai International
Financial Centre, P.O. Box No: 506607, Dubai, United ArabEmiratesTEL 971-4-279-4400

United Kingdom
London Branch
Mizuho House, 30 Old Bailey, London EC4M 7AU, United
Kingdom
TEL 44-20-7012-4000

Mizuho Capital Markets (UK) Limited

Mizuho House, 30 Old Bailey, London EC4M 7AU, United
Kingdom
TEL 44-20-3446-4500

RussiaAO Mizuho Bank (Moscow)
5th floor, 20, bld.1, Ovchinnikovskaya nab.,
115035 Moscow, Russian Federation
TEL 7-495-212-0333

Avenida Presidente Juscelino Kubitschek,
2041- Torre E- 7andar, Vila Olimpia, Sao Paulo, SP,
CEP. 04543-011, Brazil
TEL 55-11-5504-9844

CanadaCanada Branch
100 Yonge Street, Suite 1102, Toronto, Ontario,
Canada, M5C 2W1
TEL 1-416-874-0222

Calgary Office

Suite 1000, 888 3rd Street, South West, Calgary, Alberta,
Canada, T2P 5C5
TEL 1-403-444-5375

Cayman Islands
Cayman Branch
P. O. Box 1353, Harbour Place, 5th Floor,
103 South Church Street, George Town,
Grand Cayman KY1-1108, Cayman Islands

Chile
Santiago Representative Office
Av. Apoquindo 3472, Piso 7, Las Condes, Santiago, Chile
TEL 56-2-3203-5773

MexicoMexico Representative Office
Paseo de la Reforma 342, Piso 10, Colonia Juarez,
Delegacion, Cuauhtemoc, 06600, Ciudad de Mexico, Mexico
TEL 52-55-5281-5037

Mizuho Bank Mexico, S.A.
Paseo de la Reforma 342, Piso 10, Colonia Juarez,
Delegacion, Cuauhtemoc, 06600, Ciudad de Mexico, Mexico
TEL 52-55-5281-5037

Mizuho Bank Mexico, S.A.
Leon Office

Blvd. Paseo de los Insurgentes 3356, Torre 2,
nivel 2, Col. San Jose de las Piletas, 37530 Leon,
Guanajuato, Mexico
TEL 52-477-6885-248/249

USA
Chicago Branch
311 South Wacker Drive, Suite 2100, Chicago, IL 60606,
USA
TEL 1-312-855-1111

Los Angeles Branch

350 South Grand Avenue, Suite 1500, Los Angeles,
CA 90071, USA
TEL 1-213-243-4500

New York Branch

1251 Avenue of the Americas, New York, NY 10020, USA
TEL 1-212-282-3000

Park Avenue Branch

320 Park Avenue, New York, NY 10022, USA
TEL 1-212-282-3000

Atlanta Representative Office3353 Peachtree Road NE, Atlanta Financial Center,
Suite 500, Atlanta, GA 30326, USA
TEL 1-404-364-1550

Dallas Representative Office5345 Towne Square Drive, Suite 285, Plano,
TX 75024, USA
TEL 1-972-324-3350

Houston Representative Office2700 Post Oak Blvd., Suite 1270, Houston, TX 77056, USA
TEL 1-713-499-4800

San Francisco Representative Office
235 Pine Street, San Francisco, CA 94104, USA
TEL 1-415-365-1750

Washington, D.C. Representative Office1275 Pennsylvania Avenue, NW, Suite 310, Washington,
DC 20004, USA
TEL 1-202-292-5080

Mizuho Bank (USA)1251 Avenue of the Americas, New York, NY 10020, USA
TEL 1-212-282-3000

Mizuho Bank (USA)Atlanta Representative Office3353 Peachtree Road NE, Atlanta Financial Center,
Suite 500, Atlanta, GA 30326, USA
TEL 1-404-364-1550

Mizuho Bank (USA)
Chicago Representative Office

311 South Wacker Drive, Suite 2100, Chicago, IL 60606,
USA
TEL 1-312-855-1111

Mizuho Bank (USA)
Dallas Representative Office5345 Towne Square Drive, Suite 285, Plano, TX 75024,
USA
TEL 1-972-324-3350

Mizuho Bank (USA)
Houston Representative Office2700 Post Oak Blvd., Suite 1270, Houston, TX 77056, USA
TEL 1-713-499-4800

Mizuho Bank (USA)Los Angeles Representative Office

350 South Grand Avenue, Suite 1500, Los Angeles,
CA 90071, USA
TEL 1-213-243-4500

Mizuho Bank (USA)Park Avenue Branch

320 Park Avenue, New York, NY 10022, USA
TEL 1-212-282-3030

Mizuho Bank (USA)San Francisco Representative Office
235 Pine Street, San Francisco, CA 94104, USA
TEL 1-415-365-1750

Mizuho Alternative Investments, LLC

757 Third Avenue, 8th Floor, New York, NY 10017, USA
TEL 1-212-282-4804

Mizuho Capital Markets LLC

320 Park Avenue, 12th Floor, New York, NY 10022, USA
TEL 1-212-547-1500

Mizuho Desk(Country/Region)

UAE
Mashreqbank psc
Japan Desk, Mashreqbank Building 3F, Dubai Internet City,
Mashreqbank, P.O. Box 1250, Dubai, United Arab Emirates
TEL 971-4-363-2324/2285“Mizuho Desk”
By forming tie-ups with major financial institutions inregions where Mizuho does not possess offices, weoffer our clients financial services through various
institutions. (Transactions are conducted directly
between the client and the local financial institution.)

Network of Mizuho Trust & Banking
Mizuho Trust & Banking(Luxembourg) S.A.

1B, rue Gabriel Lippmann, L-5365 Munsbach,Grand Duchy of Luxembourg
TEL 352-42-16-17-1

Network of Mizuho Securities
Beijing Representative Office8011, Chang-Fu-Gong Office Building, Jia 26,
Jianguomenwai Street, Chaoyang District,
Beijing 100022, The People’s Republic of China
TEL 86-10-6523-4779

Shanghai Representative Office

T32 33rd floor, Shanghai World Financial Center,
100 Century Avenue, Pudong New Area, Shanghai
200120, The People’s Republic of China
TEL 86-21-6877-8000

Mizuho Investment Consulting(Shanghai) Co., Ltd.

T51 33rd floor, Shanghai World Financial Center,
100 Century Avenue, Pudong New Area, Shanghai
200120, The People’s Republic of China
TEL 86-21-6877-5888

Mizuho Investment Consulting(Shanghai) Co., Ltd.
Beijing Branch

6010, Chang-Fu-Gong Office Building, Jia 26,
Jianguomenwai Street, Chaoyang District, Beijing 100022,
The People’s Republic of China
TEL 86-10-6526-7577

Mizuho Securities Asia Limited

14-15/F, K11 Atelier, 18 Salisbury Road,
Tsim Sha Tsui, Kowloon, Hong Kong, S.A.R.,
The People’s Republic of China
TEL 852-2685-2000

Mizuho Securities Asia Limited,Seoul Branch

20th Floor, Seoul Finance Center, 136,
Sejongdaero,Jung-gu, Seoul, 04520, Korea
TEL 822-2206-1800

Mizuho Securities Asia Limited(Sydney Office)Level 33, 60 Margaret Street, Sydney, N.S.W. 2000,
Australia
TEL 612-8114-4511

Mizuho Securities India Private Limited

Level 18, TOWER–A, Peninsula Business Park,
Senapati Bapat Marg, Lower Parel, Mumbai 400013, India
TEL 91-22-4353-7600

Mizuho Securities (Singapore) Pte. Ltd.
12 Marina View #10-01A, Asia Square Tower 2,
Singapore 018961
TEL 65-6603-5688

Mizuho Bank (Switzerland) Ltd

Loewenstrasse 32, 8021 Zurich, Switzerland
TEL 41-44-216-9111

Mizuho International plc

Mizuho House, 30 Old Bailey, London EC4M 7AU, United
Kingdom
TEL 44-20-7236-1090

Mizuho International plc
Frankfurt Office

TaunusTurm 34th Floor, Taunustor 1, 60310 Frankfurt am
Main, Germany
TEL 49-69-4272-93001

Mizuho Securities USA LLC

320 Park Avenue, 12th Floor, New York, NY 10022, USA
TEL 1-212-209-9300

Mizuho Securities USA LLC
Boston Office

125 High Street, 21st Floor, Boston, MA 02110, USA
TEL 1-617-235-1722

Mizuho Securities USA LLC
Chicago Office

311 South Wacker Drive, Suite 700, Chicago,
IL 60606, USA
TEL 1-312-294-8800

Mizuho Securities USA LLC
Chicago Office (Investment Banking)
311 South Wacker Drive, Suite 2100, Chicago,
IL 60606, USA
TEL 1-312-855-1111

Mizuho Securities USA LLC
Houston Office (Investment Banking)2700 Post Oak Blvd, Suite 1270, Houston,
TX 77056, USA
TEL 1-713-499-4800

Mizuho Securities USA LLC
Iselin Office

101 Wood Avenue S, 3rd Floor, Iselin, NJ 08830, USA
TEL 1-201-626-1000

Mizuho Securities USA LLC
Los Angeles Office (Investment Banking)
350 South Grand Avenue, Suite 1500, Los Angeles,
CA 90071, USA
TEL 1-213-243-4500

Mizuho Securities USA LLC
New York Office (Investment Banking)1251 Avenue of the Americas, 30th Floor,
New York, NY 10020, USA
TEL 1-212-282-3000

Mizuho Securities USA LLC
San Francisco Office

235 Pine Street, 19th Floor, San Francisco, CA 94104, USA
TEL 1-415-268-5500

Mizuho Securities USA LLC
San Francisco Office (Investment Banking)235 Pine Street, 19th Floor, San Francisco, CA 94104, USA
TEL 1-415- 365-1750

Mizuho Securities USA LLC
Philadelphia Office

Two Logan Square, 100 N. 18th Street, Suite 326,
Philadelphia, PA 19103, USA
TEL 1-267- 207-3541

Network of Asset Management One
Asset Management One Hong Kong Limited
12/F., K11 Atelier, 18 Salisbury Road,
Tsim Sha Tsui, Kowloon, Hong Kong, S.A.R,
The People’s Republic of China
TEL 852-2918-9030

Asset Management One Singapore Pte. Ltd.
2 Shenton Way #12-01 SGX Centre I, Singapore 068804
TEL 65-6532-5470

Asset Management One USA Inc.

400 Park Avenue, 4th Floor, New York, NY 10022, USA
TEL 1-212-350-7650

Asset Management One International Ltd.
Mizuho House, 30 Old Bailey, London, EC4M 7AU, UK
TEL 44-207-329-3777

Mizuho International plc(DIFC Branch)

The Gate Building, East Wing, Level 5,
Dubai International Financial Centre,
PO Box 507206, Dubai, U.A.E.
TEL 44-20-7090-6181

2018 Integrated Report130

Investor information

Date of establishment

Convocation of general meetings of shareholders¥2,256.5 billion

An ordinary general meeting of shareholders of the Company
shall be convened no later than 3 months from the last day ofeach business year and an extraordinary general meeting ofshareholders shall be convened whenever necessary.

Issued shares

Record date

January 8, 2003

Paid-in capital

25,389,644,945 shares

Number of shareholders
Common stock: 1,016,315

Major shareholders (common stock)
Shares held

Percentageof shares
outstanding(%)

1

The Master Trust Bank of Japan, Ltd.
1,070,043,700(trustee account)

4.21

2

Japan Trustee Services Bank, Ltd.
(trustee account)

1,054,777,400

4.15

3

Japan Trustee Services Bank, Ltd.
(trustee account 5)

512,108,700

2.01

4

Japan Trustee Services Bank, Ltd.
(trustee account 9)479,711,500

1.88

5

State Street BankWest Client – Treaty 505234

453,273,840

1.78

6

Japan Trustee Services Bank, Ltd.
(trustee account 1)

381,129,200

1.50

7

Japan Trustee Services Bank, Ltd.
(trustee account 2)

374,905,000

1.47

8

JP Morgan Chase Bank 385151

341,932,527

1.34

9

Japan Trustee Services Bank, Ltd.
(trustee account 7)

325,656,600

1.28

10

Japan Trustee Services Bank, Ltd.
(trustee account 4)

308,675,100

1.21(As of March 31, 2018)

Stock listing(common stock)

Tokyo Stock Exchange

Accounting auditors

Ernst & Young ShinNihon LLC

Shareholder register manager
Mizuho Trust & Banking Co., Ltd.

Share unit
100 sharesFiscal year

April 1 to March 31

131

Mizuho Financial Group

Organizations that decide dividends from surplus

The Company shall decide distribution of dividends fromsurplus and other matters provided for in each item of Article
459, Paragraph 1 of the Companies Act of Japan, not by aresolution of a general meeting of shareholders, but by aresolution of the Board of Directors, unless otherwise provided
for in laws or regulations.

Record date for distribution of dividends from surplus

The record dates for distribution of dividends from surplus of
the Company shall be March 31 and September 30 of each year.

ADR* information

Notes: 1. Figures for the percentage of shares outstanding are rounded
down to the nearest second decimal place.
2. The percentages of shares outstanding are calculated by excluding
the treasury stock (6,487,234 shares).


1. The Company shall deem shareholders having voting rights
appearing in writing or electronically in the register ofshareholders as of the end of March 31 of each year as theshareholders who are entitled to exercise their rights at theordinary general meeting of shareholders for the relevantbusiness year.
2. The provision of the preceding paragraph shall apply mutatis
mutandis to the record date for voting rights at the general
meetings of holders of classes of stock, where there is amatter to be resolved at an ordinary general meeting ofshareholders that requires, in addition to such resolution, aresolution by the relevant general meeting of holders of classof stock.
3. In addition to the preceding two paragraphs, the Company
may set an extraordinary record date, when necessary, by
a determination by Executive Officer(s) under the authority
delegated by the Board of Directors and upon giving a priorpublic notice thereof.

Outline of Mizuho Financial Group’s ADR
New York Stock Exchange
1. Exchange :MFG
2. Ticker symbol :60687Y109
3. CUSIP :4. Conversion ratio :1 ADR = 2 common shares
The Bank of New York Mellon
5. Depositary bank :101 Barclay Street
New York, NY 10286
Phone: 1-201-680-6825
US Toll Free: 888-269-2377
http://www.adrbnymellon.com/
6. Local custodian bank : Mizuho Bank, Ltd.
* ADRs are securities issued for the purpose of trading in the US in place of
the underlying stock of foreign companies. As ADRs are registered with
the SEC as US securities, they are traded, settled and held in custody insubstantively the same manner as the stocks of US companies. ADR is anacronym for American Depositary Receipts.

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Analysis[Under Japanese GAAP]133

Key Indicators of Mizuho Financial Group, Inc.

135

Status of Asset Quality

132

Financial Analysis-Index

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Analysis

Key Indicators of Mizuho Financial Group, Inc.

Key Indicators of Mizuho Financial Group, Inc. (Consolidated)
Billions of yen

As of or for the Fiscal Years ended March 31,

2018

2017

2016

2015

2014

¥3,590.8
576.5
765.5
9,821.2
205,028.3
136,463.8
79,421.4
34,183.0¥3,351.7
603.5
558.1
9,273.3
200,508.6
130,676.4
78,337.7
32,353.1¥3,235.6
670.9
304.5
9,353.2
193,458.5
117,456.6
73,708.8
39,505.9¥3,180.8
611.9
1,941.09,800.5
189,684.7
113,452.4
73,415.1
43,278.7¥2,940.7
688.4
832.9
8,304.5
175,822.8
101,811.2
69,301.4
43,997.5

Net Assets per Share (Yen)

357.41335.96322.46322.86253.25

Profit Attributable to Owners of Parent
per Share (Yen)

22.72

23.86

26.94

24.91

28.18

Diluted Profit Attributable to Owners of Parent
per Share (Yen)

22.72

23.78

26.42

24.10

27.12

(International Standard (Basel III)) (Note)
Tier 1 Capital Ratio

18.24%

16.28%

15.41%

14.58%

14.36%(International Standard (Basel III)) (Note)
Common Equity Tier 1 Capital Ratio

15.44%

13.30%

12.64%

11.50%

11.35%(International Standard (Basel III)) (Note)

12.49%

11.34%

10.50%

9.43%

8.80%

6.5%
8.42x

7.2%
8.54x

8.3%
6.23x

8.6%
8.47x

11.6%
7.23x

2,966.7(2,316.1)
149.9
46,334.3

4,690.1
5,796.3(24.5)
45,523.6

4,104.1
3,687.8(521.0)35,089.1

6,654.9
2,619.2(903.4)
27,840.7(2,286.0)
10,607.4(305.7)
19,432.4

Total Income
Profit Attributable to Owners of Parent
Comprehensive Income
Net Assets
Total Assets
Deposits
Loans and Bills Discounted
Securities

Total Capital Ratio

Net Return on Equity
PER (Times)
Cash Flow from Operating Activities
Cash Flow from Investing Activities
Cash Flow from Financing Activities
Cash and Cash Equivalents at the end of the fiscal year

Note: Total Capital Ratio, Tier 1 Capital Ratio and Common Equity Tier 1 Capital Ratio are based on the “Standards for Determining the Status of Capital Adequacy in consideration of assets held by abank holding company and by its subsidiaries, in accordance with Banking Law Article 52-25” (Financial Services Agency Ordinance Announcement No.20, March 27, 2006)

133

Key Indicators of Mizuho Financial Group, Inc. (Consolidated)2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Billions of yen

As of or for the Fiscal Years ended March 31,

2018

2017

2016

2015

2014

Operating Income
Net Income¥305.0257.1¥378.0326.6¥333.5304.3¥377.7349.0¥316.8285.8

Common Stock and Preferred Stock
Number of Shares Issued and Outstanding
Common Stock
Eleventh Series Class XI Preferred Stock

2,256.5

2,256.2

2,255.7

2,255.4

2,254.9()(

Net Assets
Total Assets

25,389,644,945shares—shares)(

25,386,307,945shares—shares)(

25,030,525,657shares
914,752,000shares)(

24,621,897,967shares
914,752,000shares)(

24,263,885,187shares
914,752,000shares)

5,441.3
10,587.7

5,342.5
9,269.3

5,197.2
7,064.2

5,096.2
6,603.1

4,900.4
6,251.3

Net Assets per Share (Yen)
214.43
Dividends per Share (Yen) (Interim Dividends per Share) (Yen)Common Stock
7.5—
Eleventh Series Class XI Preferred Stock (Note)

210.51203.58198.15188.90

7.5
—

7.5
20

7.5
20

6.5
20

(

Common Stock
Eleventh Series Class XI Preferred Stock (Note)
Net Income per Share (Yen)
Diluted Net Income per Share (Yen)PER (Times)
Dividend Propensity

)(

)(

)(

3.75
—

3.75
—

3.75
10

10.13
10.13

12.91
12.86

18.88x73.98%

15.79x58.06%

)(

)(

)

3.5
10

3
10

12.17
11.98

14.11
13.74

11.53
11.25

13.81x61.62%

14.95x53.12%

17.68x56.33%

Note: Mizuho Financial Group Inc. ("MHFG") acquired all of the Eleventh Series Class XI Preferred Stock as of July 1, 2016 that had not been requested for acquisition by June 30, 2016 and calcelled allof the Eleventh Seties Class XI Preferred Stock held by MHFG on July 13, 2016. Accordingly, the cash dividends per share of the Eleventh Series Class XI Preferred Stock for the fiscal years
ended March 31, 2017 and 2018 have not been recorded.

134

Key Indicators of Mizuho Financial Group, Inc. (Consolidated)2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Analysis

Status of Asset Quality○ Credit-related Costs
Credit-related Costs (Consolidated)
Billions of yen

For the Fiscal Years ended March 31,

Credit-related Costs
Expenses related to Portfolio Problems (including Reversal of(Provision for) General Reserve for Possible Losses on Loans)
Losses on Write-offs of Loans
Gains on Reversal of Reserves for Possible Losses on Loans andothers2018

2017

Change¥(156.3)¥47.5¥(203.8)

17.0

80.2

(63.1)

15.5

15.8

(0.2)

(173.3)(32.6)(140.6)———

Credit Costs for Trust Accounts○ Overview of Non-performing Loans (NPLs) as of March 31, 2018 (the Two Banks) (Banking Accounts)
Billions of yen

1. SELF-ASSESSMENT
ObligorCategorization

NonCategorization

Category II

Category III

Category IV

76.6
Bankrupt and Substantially
Bankrupt Obligors
76.6

Collateral, Guarantees, etc.:
75.1
Reserves for Possible Losses.:

Reserve
Ratio
100%

DirectWrite-offs

2. Disclosed Claims under
the Financial Reconstruction Act
Claims against Bankrupt
and Substantially Bankrupt
Obligors
76.6

3. Non-Accrual, Past
Due & Restructured
Loans
Loans to Bankrupt Obligors
20.8

Coverage Ratio 100%

1.4

Non-Accrual
232.9
Intensive Control
Obligors
281.4

Collateral, Guarantees, etc.:
140.1
Reserves for Possible Losses:

Watch Obligors

92.8

Claims for Special
Attention
197.8

Reserve Ratio against
Uncovered Portion
26.8%
Collateral, Guarantees, etc.:
51.4
Reserves for Possible Losses:

39.3

Special Attention Obligors

Other Watch Obligors
Normal Obligors

48.4
Reserve
Ratio
65.7%

Amounts forreserves arerecorded under
Non-Categorization

Claims against Special
Attention Obligors-Coverage Ratio: 54.1%-Reserve Ratiofor Uncovered Portion: 29.5%-Reserve Ratio
against Total Amount ofClaims: 19.2%
Reserve Ratio
against Total Amount of Claims·Other Watch Obligors: 3.92%·Normal Obligors: 0.05%

Total
84,191.8

Claims with Collection Risk
281.4

Delinquent Loans
302.9

Coverage Ratio 82.7%
34.3 (Notes 2)
Claims for Special
Attention (Notes 1)
197.8
Coverage Ratio 45.9%

Loans Past Due for
3 Months or More
0.6
Restructured Loans
197.2

Total Coverage Ratio
72.1%

Total
555.9

Total
521.5

Notes: 1. Claims for Special Attention is denoted on an individual loans basis. Claims against Special Attention Obligors includes all claims, not limited to Claims for Special Attention.
2. The difference between total Non-Accrual, Past Due & Restructured Loans and total Disclosed Claims under the FRA represents the amount of claims other than loans included in Disclosed
Claims under the FRA.

135

Credit-related Costs、Overview of Non-performing Loans (NPLs)

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）○ Status of Disclosed Claims under the FRA
Disclosed Claims under the FRA (Consolidated)(Consolidated)
Billions of yen

As of March 31,

2018

2017

ChangeClaims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

¥87.3
291.7
241.3

¥98.4
401.2
422.5

¥(11.0)(109.5)(181.2)¥620.4¥922.2¥(301.7)

2018

2017

Change

¥96.8

¥93.3

¥3.5

As of March 31,

2018

2017

ChangeClaims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

¥—
2.8
—

¥—
2.8
—

¥—
(0.0)
—

¥2.8

¥2.8

¥(0.0)

As of March 31,

2018

2017

ChangeClaims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

¥87.3
294.5
241.3

¥98.4
404.1
422.5

¥(11.0)(109.5)(181.2)¥623.3¥925.1¥(301.8)

Total
Note: Above figures are presented net of partial direct write-offs, the amounts of which are indicated in the table below.

Billions of yen

Amount of Partial Direct Write-offs(Trust Accounts)
Billions of yen

Total(Consolidated and Trust Accounts)
Billions of yen

Total

136

Status of Disclosed Claims under the FRA

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Analysis

Status of Asset Quality○ Status of Non-Accrual, Past Due & Restructured Loans (Consolidated)(Consolidated)
Non-Accrual, Past Due & Restructured Loans
Billions of yen

As of March 31,

2018

2017

ChangeLoans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

¥21.2
332.7
0.6
240.7

¥33.3
430.5
7.8
414.7

¥(12.0)(97.8)(7.2)(173.9)¥595.3¥886.4¥(291.0)

2018

2017

Change

¥92.0

¥87.4

¥4.5

2018

2017

Change

0.02%
0.41
0.00
0.30

0.04%
0.54
0.01
0.52

(0.01)%(0.13)(0.00)(0.22)

0.74%

1.13%

(0.38)%

2018

2017

Change¥315.6
200.6
115.0
0.0

¥509.1
344.7
164.4
0.0

¥(193.5)(144.1)(49.4)
(0.0)

2018

2017

Change

¥97.1

¥93.7

¥3.3

2018

2017

Change53.01%

57.43%(4.42)%

Total
Note: Above figures are presented net of partial direct write-offs, the amounts of which are indicated in the table below.

Billions of yen

Amount of Partial Direct Write-offs

Ratio to Total Loans%

As of March 31,

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

Non-Accrual, Past Due & Restructured Loans / Total Loans
Note: Above figures are presented net of partial direct write-offs.

Reserves for Possible Losses on Loans
Billions of yen

As of March 31,

Reserves for Possible Losses on Loans
General Reserve for Possible Losses on Loans
Specific Reserve for Possible Losses on Loans
Reserve for Possible Losses on Loans to Restructuring Countries
Note: Above figures are presented net of partial direct write-offs, the amounts of which are indicated in the table below.

Billions of yen

Amount of Partial Direct Write-offs

Reserve Ratios for Non-Accrual, Past Due & Restructured Loans%

As of March 31,

After Partial Direct Write-offs
Note: Reserve Ratio = Reserves for Possible Losses on Loans / Total Non-Accrual, Past Due & Restructured Loans.

137

Status of Non-Accrual, Past Due & Restructured Loans (Consolidated)2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(Trust Accounts)
Non-Accrual, Past Due & Restructured Loans
Billions of yen

As of March 31,

2018

2017

ChangeLoans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

¥—
2.8
—
—

¥—
2.8
—
—

¥—
(0.0)
—
—

¥2.8

¥2.8

¥(0.0)

2018

2017

Change

—%
25.16
—
—

—%
23.09
—
—

—%
2.07
—
—

25.16%

23.09%

2.07%

As of March 31,

2018

2017

ChangeLoans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

¥21.2
335.5
0.6
240.7

¥33.3
433.4
7.8
414.7

¥(12.0)(97.8)(7.2)(173.9)¥598.1¥889.3¥(291.1)

2018

2017

Change

0.02%
0.42
0.00
0.30

0.04%
0.55
0.01
0.52

(0.01)%(0.13)(0.00)(0.22)

0.75%

1.13%

(0.38)%

Total

Ratio to Total Loans%

As of March 31,

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

Non-Accrual, Past Due & Restructured Loans / Total Loans(Consolidated and Trust Accounts)
Non-Accrual, Past Due & Restructured Loans
Billions of yen

Total
Note: Above figures are presented net of partial direct write-offs.

Ratio to Total Loans%

As of March 31,

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

Non-Accrual, Past Due & Restructured Loans / Total Loans
Note: Above figures are presented net of partial direct write-offs.

138

Status of Non-Accrual, Past Due & Restructured Loans (Consolidated)2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Analysis

Status of Asset Quality○ Status of Loans by Industry
Outstanding Balances by Industry (Consolidated)
Billions of yen, %As of March 31,

2018
Outstanding
Balance Composition

2017
Outstanding
Balance Composition

Domestic Total (excluding Loans Booked Offshore)
Manufacturing
Agriculture & Forestry
Fishery
Mining, Quarrying Industry & Gravel Extraction Industry
Construction
Utilities
Communication
Transportation & Postal Industry
Wholesale & Retail
Finance & Insurance
Real Estate
Commodity Lease
Service Industries
Local Governments
Governments
Other
Overseas Total (including Loans Booked Offshore)
Governments
Financial Institutions
Other¥57,614.2
8,039.8
38.2
2.4
221.5
633.6
2,446.5
1,486.1
2,068.6
4,713.3
4,532.2
7,481.6
2,148.5
2,878.1
931.6
7,946.6
12,044.7
21,807.2
818.7
5,750.3
15,238.1¥57,081.8
8,625.8
37.7
1.3
224.8
643.1
2,212.1
1,425.0
2,032.5
4,737.5
4,071.5
7,140.2
2,104.6
2,648.2
866.0
7,662.4
12,648.3
21,255.9
672.6
5,759.8
14,823.4

Total¥79,421.4

100.00%
13.95
0.07
0.00
0.38
1.10
4.25
2.58
3.59
8.18
7.87
12.99
3.73
4.99
1.62
13.79
20.91
100.00
3.75
26.37
69.88
/

¥78,337.7

100.00%
15.11
0.06
0.00
0.39
1.13
3.88
2.50
3.56
8.30
7.13
12.51
3.69
4.64
1.52
13.42
22.16
100.00
3.16
27.10
69.74
/

ChangeOutstanding
Balance Composition¥532.4(585.9)
0.5
1.1
(3.3)
(9.4)
234.4
61.1
36.0
(24.1)
460.7
341.3
43.9
229.9
65.5
284.1
(603.5)
551.2
146.1
(9.4)
414.6

/
(1.16)%
0.01
0.00(0.01)(0.03)
0.37
0.08
0.03
(0.12)
0.74
0.48
0.04
0.35
0.10
0.37
(1.25)/
0.59(0.73)
0.14¥1,083.6/

Notes :1. Domestic Total = MHFG and its domestic consolidated subsidiaries (excluding their overseas offices).
Overseas Total = Overseas offices of MHFG's domestic consolidated subsidiaries and MHFG's overseas consolidated subsidiaries
2 .As for Domestic Total (excluding Loans Booked Offshore), parts of Loans which have been included in Other and others are included in Real Estate and parts of Loans which have been
included in Transportation & Postal Industry and others are included in Other.

○ Status of Loans by Nationality of Borrowers
Balance of Loans to Restructuring Countries (Consolidated)
As of March 31, 2018

Argentina
Total
Ratio to Total Assets

Billions of yen, %

¥0.0
¥0.0
0.00%

As of March 31, 2017

Argentina
Total
Ratio to Total Assets

Billions of yen, %

¥0.0
¥0.0
0.00%

Note: Listed are loans to the government and related agents in restructuring countries for which Reserves for Possible Losses on Loans to Restructuring Countries are accounted as stipulated under theJapanese Institute of Certified Public Accountants (JICPA) Banking Audit Committee Report No.4.

139

Status of Loans by Industry、Status of Loans by Nationality of Borrowers

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.
[Under Japanese GAAP]141

Independent Auditor’s Report

142

Consolidated Financial Statements

154

Notes to Consolidated Financial Statements

140

Financial Data of Mizuho Financial Group, Inc.-Index

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Independent Auditor’s Report

Independent Auditor’s Report
The Board of Directors
Mizuho Financial Group, Inc.
We have audited the accompanying consolidated financial statements of Mizuho Financial Group, Inc.,
which comprise the consolidated balance sheet as of March 31, 2018, and the consolidated statements ofincome, comprehensive income, changes in net assets, and cash flows for the year then ended and a summaryof significant accounting policies and other explanatory information, all expressed in Japanese yen.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statementsin accordance with accounting principles generally accepted in Japan, and for designing and operating suchinternal control as management determines is necessary to enable the preparation and fair presentation of theconsolidated financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in Japan. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including
the assessment of the risks of material misstatement of the consolidated financial statements, whether due
to fraud or error. The purpose of an audit of the consolidated financial statements is not to express an opinion
on the effectiveness of the entity’s internal control, but in making these risk assessments the auditor considers
internal controls relevant to the entity’s preparation and fair presentation of the consolidated financial
statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates
made by management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
OpinionIn our opinion, the consolidated financial statements referred to above present fairly, in all material respects,
the consolidated financial position of Mizuho Financial Group, Inc. as of March 31, 2018, and their consolidated
financial performance and cash flows for the year then ended in conformity with accounting principles
generally accepted in Japan.
Convenience Translation
We have reviewed the translation of these consolidated financial statements into U.S. dollars, presented
for the convenience of readers, and, in our opinion, the accompanying consolidated financial statements
have been properly translated on the basis described in Note 1.

June 21, 2018
Tokyo, Japan141

Independent Auditor’s Report2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Balance Sheet

2017

Thousands of
U.S. dollars (Note 1)
2018

47,129,583
1,035,746
8,967,777$ 449,095,331
6,729,550
76,040,970

4,350,527
3,350,051
2,713,742
2,745,204
10,507,133
10,361,787
337,429
247,583
34,183,033
32,353,158
79,421,473
78,337,793
1,941,677
1,828,782
1,807,999
2,170,750
4,588,484
4,180,339
1,111,128
1,136,329
1,092,708
1,045,486
996,173
797,762
47,83956,066
5,723,186
5,273,581(315,621)(509,175)¥ 205,028,300 ¥ 200,508,610

40,938,430
25,536,297
98,872,053
3,175,212
321,662,122
747,355,546
18,271,169
17,013,264
43,177,613
10,455,713
10,282,375
9,373,990
450,174
53,855,148(2,969,997)$ 1,929,314,960

Millions of yen
2018

As of March 31,

AssetsCash and Due from Banks (Notes 17, 39, 41 and 42)
Call Loans and Bills Purchased (Note 41)
Receivables under Resale Agreements (Note 41)
Guarantee Deposits Paid under Securities Borrowing Transactions(Note 41)
Other Debt Purchased (Notes 41 and 42)
Trading Assets (Notes 10, 17, 41 and 42)
Money Held in Trust (Notes 41 and 42)
Securities (Notes 11, 17, 26, 41 and 42)
Loans and Bills Discounted (Notes 12, 17 and 41)
Foreign Exchange Assets (Note 13)
Derivatives other than for Trading Assets (Notes 41 and 43)
Other Assets (Notes 14, 17 and 42)
Tangible Fixed Assets (Notes 15, 28 and 40)
Intangible Fixed Assets (Note 40)
Net Defined Benefit Asset (Note 25)
Deferred Tax Assets (Note 27)
Customers' Liabilities for Acceptances and Guarantees (Note 26)
Reserves for Possible Losses on Loans (Notes 16 and 41)
Total Assets¥

47,725,360 ¥
715,149
8,080,873

142

Consolidated Balance Sheet2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Balance Sheet—(Continued)

2017

Thousands of
U.S. dollars (Note 1)
2018¥ 136,463,824 ¥ 130,676,494
2,105,293
1,255,172
16,656,828
17,969,753$ 1,284,123,689
19,810,801
156,740,647

Millions of yen
2018

As of March 31,

Liabilities and Net Assets
Liabilities
Deposits (Notes 17, 18 and 41)
Call Money and Bills Sold (Notes 19 and 41)
Payables under Repurchase Agreements (Notes 17 and 41)
Guarantee Deposits Received under Securities Lending
Transactions (Notes 17 and 41)
Commercial Paper (Note 20)
Trading Liabilities (Notes 10 and 41)
Borrowed Money (Notes 17, 21 and 41)
Foreign Exchange Liabilities (Note 13)
Short-term Bonds (Note 22)
Bonds and Notes (Notes 23 and 41)
Due to Trust Accounts (Note 41)
Derivatives other than for Trading Liabilities (Notes 41 and 43)
Other Liabilities (Note 24)
Reserve for Bonus Payments
Reserve for Variable Compensation
Net Defined Benefit Liability (Note 25)
Reserve for Director and Corporate Auditor Retirement Benefits
Reserve for Possible Losses on Sales of Loans
Reserve for Contingencies
Reserve for Reimbursement of Deposits
Reserve for Reimbursement of Debentures
Reserves under Special Laws
Deferred Tax Liabilities (Note 27)
Deferred Tax Liabilities for Revaluation Reserve for Land (Note 28)
Acceptances and Guarantees (Note 26)
Total Liabilities
Net Assets
Common Stock and Preferred Stock (Note 29)
Capital Surplus
Retained Earnings
Treasury Stock (Note 29)
Total Shareholders' Equity
Net Unrealized Gains (Losses) on Other Securities (Note 42)
Deferred Gains or Losses on Hedges
Revaluation Reserve for Land (Note 28)
Foreign Currency Translation Adjustments
Remeasurements of Defined Benefit Plans (Note 25)
Total Accumulated Other Comprehensive Income

1,566,833

1,679,300

14,743,895

710,391
789,705
8,121,543
7,923,285
4,896,218
6,307,230
445,804
526,053
362,185
226,3487,544,256
7,564,535
4,733,131
4,784,077
1,514,483
1,784,857
3,685,585
3,883,168
66,872
67,6333,242
3,018
58,89055,236
1,460
1,327
1,075
298
5,622
5,680
20,011
19,07230,76032,7202,361
2,309
421,002337,800
66,186
66,5855,723,186
5,273,581¥ 195,207,054 ¥ 191,235,249

6,684,778
76,423,669
46,073,388
4,195,021
3,408,162
70,991,403
44,538,732
14,251,282
34,681,339
629,269
30,514554,160
13,742
10,11852,909188,304
289,460
22,2183,961,632
622,81353,855,148$ 1,836,897,093¥$

2,256,548 ¥
1,134,922
4,002,835(5,997)
7,388,309
1,392,392(67,578)
144,277(85,094)
293,536
1,677,534

Stock Acquisition Rights (Note 30)

1,163

2,256,275
1,134,416
3,615,449(4,849)7,001,291
1,289,985
10,172
145,609(69,657)
144,866
1,520,976
1,754

21,234,108
10,679,617
37,666,651(56,435)
69,523,941
13,102,408(635,912)
1,357,652(800,741)
2,762,180
15,785,587
10,952

Non-controlling Interests

754,239749,339

7,097,387

Total Net Assets

9,821,246

9,273,361

92,417,867¥ 205,028,300 ¥ 200,508,610$ 1,929,314,960

Total Liabilities and Net Assets

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

143

Consolidated Balance Sheet2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Consolidated Statement of Income
Millions of yen
2018

For the Fiscal Years ended March 31,

IncomeInterest Income (Note 31)
Fiduciary Income
Fee and Commission Income
Trading Income (Note 32)
Other Operating Income (Note 33)
Other Income (Note 35)
Total Income
Expenses
Interest Expenses (Note 31)
Fee and Commission Expenses
Trading Expenses (Note 32)
Other Operating Expenses (Note 34)
General and Administrative Expenses
Other Expenses (Note 36)
Total Expenses¥

1,622,354
55,400766,612276,616
304,214565,683
3,590,881¥

2017

1,445,555
50,627752,982
326,230
338,276
438,042
3,351,714

Thousands of
U.S. dollars (Note 1)
2018$15,266,345
521,317
7,213,817
2,602,958
2,862,658
5,323,076
33,790,171

814,988
152,262829
141,760
1,488,973
192,1132,790,927

577,737
149,439898
92,856
1,467,221
279,368
2,567,521

7,669,033
1,432,790
7,804
1,333,967
14,011,234
1,807,784
26,262,612

Income before Income Taxes
Income Taxes:
Current
Deferred
Total Income Taxes

799,953784,193

7,527,559

190,158
1,469
191,627

196,535(58,800)
137,735

1,789,387
13,824
1,803,211

Profit608,326

646,457

5,724,348

Profit Attributable to Non-controlling Interests
Profit Attributable to Owners of Parent

31,778¥576,547

42,913¥

603,544

299,039$

5,425,309

144

Consolidated Statement of Income

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Per Share of Common Stock
Yen
2018

As of March 31,

Net Income:
Basic
DilutedCash Dividends

¥

22.72
22.72
7.50

2017

¥

U.S. dollars (Note 1)
2018

23.86
23.78
7.50

$

0.21
0.21
0.07

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

Consolidated Statement of Comprehensive Income
Millions of yen
2018

For the Fiscal Years ended March 31,

ProfitOther Comprehensive Income (Note 37):
Net Unrealized Gains (Losses) on Other Securities
Deferred Gains or Losses on Hedges
Revaluation Reserve for Land
Foreign Currency Translation Adjustments
Remeasurements of Defined Benefit Plans
Share of Other Comprehensive Income of Associates
Accounted for Using Equity Method
Comprehensive Income
Comprehensive Income Attributable to Owners of Parent:
Comprehensive Income Attributable to Non-controlling Interests:¥¥¥

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

145

Per Share of Common Stock、Consolidated Statement of Comprehensive Income

608,326
157,233
102,332(77,205)(133)(10,949)
149,473(6,284)
765,559734,303
31,255

¥

¥
¥

2017

646,457(88,326)(10,965)(155,158)(11)(12,514)93,588(3,266)558,131519,532
38,598

Thousands of
U.S. dollars (Note 1)
2018

$

$
$

5,724,348
1,479,564
962,950(726,506)(1,259)(103,030)
1,406,545(59,136)
7,203,912
6,909,794
294,118

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Consolidated Statement of Changes in Net Assets
Millions of yen
Shareholders' Equity

For the Fiscal Year ended
March 31, 2018

Balance as of the beginningof the period

CommonStock andPreferred
Stock

CapitalSurplusRetained
Earnings

Treasury
Stock

Total
Shareholders'Equity¥ 2,256,275 ¥ 1,134,416¥ 3,615,449¥ (4,849)¥7,001,291

Changes during the period
Issuance of New Shares

273

273

Cash Dividends
Profit Attributable to Ownersof Parent
Repurchase of Treasury
Stock
Disposition of Treasury
Stock
Transfer from Revaluation
Reserve for Land
Change in Treasury Sharesof Parent Arising fromTransactions with Noncontrolling Shareholders
Net Changes in Items otherthan Shareholders' Equity
Total Changes during theperiodBalance as of the end of theperiod546(190,360)(190,360)

576,547

576,547(53)(2,431)(2,431)

1,283

1,229

1,198

1,198

287

273

287

506

387,385(1,148)387,017¥ 2,256,548 ¥ 1,134,922¥ 4,002,835¥ (5,997)¥ 7,388,309

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

146

Consolidated Statement of Changes in Net Assets

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Statement of Changes in Net Assets—(Continued)
Millions of yen
Accumulated Other Comprehensive Income
Net
Unrealized
Gains(Losses) on
For the Fiscal Year ended
March 31, 2018

Balance as of the beginningof the period

Other
Securities¥ 1,289,985

Deferred
Gains or
Losses on
Hedges

Revaluation
Reserve forLand

Foreign
Currency
Translation
Adjustments

Remeasurements ofDefinedBenefit Plans¥ 10,172¥ 145,609¥ (69,657)¥ 144,866

Stock
Total
Accumulated Acquisition
Rights
Other
Comprehensive
Income¥ 1,520,976

NonControlling
Interests

Total
Net Assets¥ 1,754 ¥ 749,339¥ 9,273,361

Changes during the period
Issuance of New Shares

546

Cash Dividends
Profit Attributable to Ownersof Parent
Repurchase of Treasury
Stock
Disposition of Treasury
Stock
Transfer from Revaluation
Reserve for Land
Change in Treasury Sharesof Parent Arising fromTransactions with Noncontrolling Shareholders
Net Changes in Items otherthan Shareholders' Equity
Total Changes during theperiodBalance as of the end of theperiod(190,360)
576,547(2,431)
1,229
1,198

287

102,407(77,750)(1,331)(15,437)

148,670

156,558

(590)

4,899

160,867

102,407(77,750)(1,331)(15,437)

148,670

156,558

(590)

4,899

547,884¥ 1,392,392¥ (67,578)¥ 144,277¥ (85,094)¥ 293,536¥ 1,677,534¥ 1,163 ¥ 754,239¥ 9,821,246

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

147

Consolidated Statement of Changes in Net Assets

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Consolidated Statement of Changes in Net Assets—(Continued)
Millions of yen
Shareholders' Equity

For the Fiscal Year ended
March 31, 2017

Balance as of the beginningof the period
Cumulative Effects of
Changes in Accounting
Policies
Balance as of the beginningof the period reflecting
Changes in Accounting
Policies

CommonStock andPreferred
Stock

CapitalSurplusRetained
Earnings

Treasury
Stock

Total
Shareholders'Equity¥ 2,255,790 ¥ 1,110,164¥ 3,197,616¥ (3,609)¥ 6,559,962

1,426¥ 2,255,790 ¥ 1,110,164¥ 3,199,042

1,426¥ (3,609)¥ 6,561,388

Changes during the period
Issuance of New Shares

484

484

Cash Dividends
Profit Attributable to Ownersof Parent
Repurchase of Treasury
Stock
Disposition of Treasury
(55)
Stock
Cancellation of Treasury
(1)
Stock
Transfer from Revaluation
Reserve for Land
Change in Treasury Sharesof Parent Arising from23,823
Transactions with Noncontrolling Shareholders
Net Changes in Items otherthan Shareholders' Equity
Total Changes during the484
24,251
periodBalance as of the end of the¥ 2,256,275 ¥ 1,134,416
period969(190,001)(190,001)

603,544603,544(1,904)(1,904)

663

608

1

―

2,863

2,863

23,823

416,406(1,239)439,903¥ 3,615,449¥ (4,849)¥ 7,001,291

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

148

Consolidated Statement of Changes in Net Assets

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Statement of Changes in Net Assets—(Continued)
Millions of yen
Accumulated Other Comprehensive Income
Net
Unrealized
Gains(Losses) on
For the Fiscal Year ended
March 31, 2017

Balance as of the beginningof the period
Cumulative Effects of
Changes in Accounting
Policies
Balance as of the beginningof the period reflecting
Changes in Accounting
Policies

Other
Securities¥ 1,296,039

Deferred
Gains or
Losses on
Hedges

Revaluation
Reserve forLand

Foreign
Currency
Translation
Adjustments

Remeasurements ofDefinedBenefit Plans¥ 165,264¥ 148,483¥ (53,689)¥ 51,752

Stock
Total
Accumulated Acquisition
Rights
Other
Comprehensive
Income¥ 1,607,851

NonControlling
Interests

Total
Net Assets¥ 2,762 ¥1,182,668 ¥ 9,353,244

1,426¥ 1,296,039¥ 165,264¥ 148,483¥ (53,689)¥ 51,752¥ 1,607,851¥ 2,762 ¥1,182,668 ¥ 9,354,670

Changes during the period
Issuance of New Shares

969

Cash Dividends
Profit Attributable to Ownersof Parent
Repurchase of Treasury
Stock
Disposition of Treasury
Stock
Cancellation of Treasury
Stock
Transfer from Revaluation
Reserve for Land
Change in Treasury Sharesof Parent Arising fromTransactions with Noncontrolling Shareholders
Net Changes in Items otherthan Shareholders' Equity
Total Changes during theperiodBalance as of the end of theperiod(190,001)
603,544(1,904)
608
―
2,863

23,823(6,054)(155,091)(2,874)(15,967)

93,113(86,875)(1,008)(433,328)(521,212)(6,054)(155,091)(2,874)(15,967)

93,113(86,875)(1,008)(433,328)(81,308)¥ 1,289,985¥ 10,172¥ 145,609¥ (69,657)¥ 144,866¥ 1,520,976

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

149

Consolidated Statement of Changes in Net Assets¥ 1,754 ¥ 749,339 ¥ 9,273,361

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Consolidated Statement of Changes in Net Assets—(Continued)
Thousands of U.S. dollars (Note 1)
Shareholders' Equity

For the Fiscal Year ended
March 31, 2018

Balance as of the beginningof the period

CommonStock andPreferred
Stock

CapitalSurplusRetained
Earnings

Treasury
Stock

Total
Shareholders'Equity$ 21,231,536 $ 10,674,851$ 34,021,357$ (45,632)$ 65,882,112

Changes during the period
Issuance of New Shares

2,572

2,572

Cash Dividends
Profit Attributable to Ownersof Parent
Repurchase of Treasury
Stock
Disposition of Treasury
(507)
Stock
Transfer from Revaluation
Reserve for Land
Change in Treasury Sharesof Parent Arising from
2,701
Transactions with Noncontrolling Shareholders
Net Changes in Items otherthan Shareholders' Equity
Total Changes during the
2,572
4,766
periodBalance as of the end of the$ 21,234,108 $ 10,679,617
period5,144(1,791,289)(1,791,289)

5,425,309

5,425,309(22,880)(22,880)

12,077

11,57011,274

11,2742,701

3,645,294(10,803)3,641,829$ 37,666,651$ (56,435)$ 69,523,941

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

150

Consolidated Statement of Changes in Net Assets

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Statement of Changes in Net Assets—(Continued)
Thousands of U.S. dollars (Note 1)
Accumulated Other Comprehensive Income
Net
Unrealized
Gains(Losses) on
For the Fiscal Year ended
March 31, 2018

Balance as of the beginningof the period

Other
Securities$ 12,138,753

Deferred
Gains or
Losses on
Hedges

Revaluation
Reserve forLand

Foreign
Currency
Translation
Adjustments

Remeasurements ofDefinedBenefit
Plans

Total
Stock
Accumulated Acquisition
Other
RightsComprehensive
Income$ 95,722$ 1,370,185$ (655,474)$ 1,363,189$ 14,312,375

NonControlling
Interests

Total
Net Assets$ 16,506 $ 7,051,281 $ 87,262,274

Changes during the period
Issuance of New Shares

5,144

Cash Dividends
Profit Attributable to Ownersof Parent
Repurchase of Treasury
Stock
Disposition of Treasury
Stock
Transfer from Revaluation
Reserve for Land
Change in Treasury Sharesof Parent Arising fromTransactions with Noncontrolling Shareholders
Net Changes in Items otherthan Shareholders' Equity
Total Changes during theperiodBalance as of the end of theperiod(1,791,289)
5,425,309(22,880)
11,57011,274

2,701

963,655(731,634)(12,533)(145,267)

1,398,991

1,473,212(5,554)

46,106

1,513,764

963,655(731,634)(12,533)(145,267)

1,398,991

1,473,212(5,554)

46,106

5,155,593$ 13,102,408$ (635,912)$ 1,357,652$ (800,741)$ 2,762,180$ 15,785,587

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

151

Consolidated Statement of Changes in Net Assets$ 10,952 $ 7,097,387 $ 92,417,867

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Consolidated Statement of Cash Flows
Millions of yen
2018

For the Fiscal Years ended March 31,

Cash Flow from Operating Activities
Income before Income Taxes
Depreciation
Losses on Impairment of Fixed Assets
Amortization of Goodwill
Losses (Gains) on Step Acquisition
Equity in Loss (Gain) from Investments in Affiliates
Increase (Decrease) in Reserves for Possible Losses on Loans
Increase (Decrease) in Reserve for Possible Losses on Salesof Loans
Increase (Decrease) in Reserve for Contingencies
Increase (Decrease) in Reserve for Bonus Payments
Increase (Decrease) in Reserve for Variable Compensation
Decrease (Increase) in Net Defined Benefit Asset
Increase (Decrease) in Net Defined Benefit Liability
Increase (Decrease) in Reserve for Director and Corporate
Auditor Retirement Benefits
Increase (Decrease) in Reserve for Reimbursement of Deposits
Increase (Decrease) in Reserve for Reimbursement ofDebentures
Interest Income—accrual basis
Interest Expenses—accrual basis
Losses (Gains) on Securities
Losses (Gains) on Money Held in Trust
Foreign Exchange Losses (Gains)—net
Losses (Gains) on Disposition of Fixed Assets
Losses (Gains) on Cancellation of Employee Retirement Benefit
Trust
Decrease (Increase) in Trading Assets
Increase (Decrease) in Trading Liabilities
Decrease (Increase) in Derivatives other than for Trading Assets
Increase (Decrease) in Derivatives other than for Trading
Liabilities
Decrease (Increase) in Loans and Bills Discounted
Increase (Decrease) in Deposits
Increase (Decrease) in Borrowed Money (excluding
Subordinated Borrowed Money)
Decrease (Increase) in Due from Banks (excluding Due fromCentral Banks)
Decrease (Increase) in Call Loans, etc.
Decrease (Increase) in Guarantee Deposits Paid under
Securities Borrowing Transactions
Increase (Decrease) in Call Money, etc.
Increase (Decrease) in Commercial Paper
Increase (Decrease) in Guarantee Deposits Received under
Securities Lending Transactions
Decrease (Increase) in Foreign Exchange Assets
Increase (Decrease) in Foreign Exchange Liabilities
Increase (Decrease) in Short-term Bonds (Liabilities)
Increase (Decrease) in Bonds and Notes¥¥

799,953
173,660
6,960
4,154
―
(21,474)(194,197)¥

2017

784,193
166,2656,651
2,816(56,226)(18,899)
57,472Thousands of
U.S. dollars (Note 1)
2018$

7,527,559
1,634,147
65,49839,093―(202,073)(1,827,395)

777
207
(18)
223
(24,803)
3,756

31
(254)
5,809
182
(17,677)
3,740

7,313
1,951
(172)
2,107
(233,400)
35,347

175

(358)

1,654

939

2,917

8,836

(1,959)(6,524)(18,443)(1,622,354)
814,988(263,312)(139)
229,892
1,495(1,445,555)
577,737(357,710)
292
107,847
2,608(15,266,345)
7,669,033(2,477,769)(1,310)2,163,284
14,076(26,032)―(244,964)(132,951)
154,664
354,027

2,426,324(2,142,414)
946,548(1,251,070)
1,455,393
3,331,395(260,185)(748,426)(2,448,340)(1,431,302)
6,171,313(5,192,399)
14,080,723(13,468,549)
58,072,016(1,371,484)(1,139,322)(12,905,657)(9,678)1,030,590(416,740)(1,333,261)(91,078)
9,697,853(1,000,475)

57,338(9,414,465)

122,103(37,576)

152,026(216,041)

1,148,997(353,598)(112,466)(929,671)(1,058,309)(141,992)(80,565)
135,837(411,073)(410,914)
33,814(422,033)
745,704(1,336,148)(758,118)
1,278,228$ (3,868,203)¥

152

Consolidated Statement of Cash Flows

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Statement of Cash Flows—(Continued)
Millions of yen
2018

For the Fiscal Years ended March 31,

Increase (Decrease) in Due to Trust Accounts
Interest and Dividend Income—cash basis
Interest Expenses—cash basis
Other—net
Subtotal
Cash Refunded (Paid) in Income Taxes
Net Cash Provided by (Used in) Operating Activities
Cash Flow from Investing Activities
Payments for Purchase of Securities
Proceeds from Sale of Securities
Proceeds from Redemption of Securities
Payments for Increase in Money Held in Trust
Proceeds from Decrease in Money Held in Trust
Payments for Purchase of Tangible Fixed Assets
Payments for Purchase of Intangible Fixed Assets
Proceeds from Sale of Tangible Fixed Assets
Proceeds from Sale of Intangible Fixed Assets
Proceeds from Sale of Stocks of Subsidiaries (affecting thescope of consolidation)
Net Cash Provided by (Used in) Investing Activities¥ (50,946)
1,602,227(797,725)(475,640)
3,139,593(172,892)
2,966,701¥(60,973,137)
42,292,827
16,679,426(155,042)
61,626(57,974)(181,647)
16,3850(46,111,207)
41,930,689
10,419,553(88,905)
28,521(105,634)(285,561)
8,932
2(573,756,823)
397,975,231
156,953,295(1,458,947)
579,908(545,542)(1,709,302)
154,191
8

1,337(2,316,197)―
5,796,391

12,582(21,795,399)

35,000(69,000)
574,000(172,600)
3
1,450(1,065)(190,382)(25,832)

25,000(80,000)
795,000(76,000)
6
3,322(467,320)(190,031)(31,168)

329,350(649,289)
5,401,336(1,624,165)
31
13,648(10,028)(1,791,495)(243,083)―(1,611)
0―
149,962(216)(1,434)0(1,695)(24,537)―(15,160)
5―
1,411,150

10,203810,670(27,645)
10,434,339

96,016
7,628,404

45,523,663

35,089,122

428,377,375

―

201

―

¥ 46,334,334¥ 45,523,663$ 436,005,779

Cash Flow from Financing Activities
Proceeds from Subordinated Borrowed Money
Repayments of Subordinated Borrowed Money
Proceeds from Issuance of Subordinated Bonds
Payments for Redemption of Subordinated Bonds
Proceeds from Issuance of Common Stock
Proceeds from Investments by Non-controlling Shareholders
Repayments to Non-controlling Shareholders
Cash Dividends Paid
Cash Dividends Paid to Non-controlling Shareholders
Payments for Purchase of Stocks of Subsidiaries (not affecting
the scope of consolidation)
Payments for Repurchase of Treasury Stock
Proceeds from Sale of Treasury Stock
Payments for Repurchase of Treasury Stock of Subsidiaries
Net Cash Provided by (Used in) Financing Activities
Effect of Foreign Exchange Rate Changes on Cash and Cash
Equivalents
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at the Beginning of the Fiscal YearNet Increase (Decrease) in Cash and Cash Equivalents from
Merger of Consolidated Subsidiaries
Cash and Cash Equivalents at the End of the Fiscal Year
(Note 39)

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

153

Consolidated Statement of Cash Flows

2017(283,413)
1,454,769(553,494)(987,540)
4,936,937(246,806)
4,690,131

Thousands of
U.S. dollars (Note 1)
2018$(479,405)
15,076,955(7,506,588)(4,475,778)
29,543,558(1,626,921)
27,916,637

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

1. Basis for Presentation
The accompanying consolidated financial statements have been prepared from the accounts maintained by Mizuho
Financial Group, Inc. (“MHFG”) and its consolidated subsidiaries in accordance with the provisions set forth in the Company
Law of Japan and the Financial Instruments and Exchange Law, and in conformity with accounting principles generally
accepted in Japan (“Japanese GAAP”) which are different in certain respects from the application and disclosure
requirements of International Financial Reporting Standards.
Certain items presented in the consolidated financial statements which were previously filed with the Director General of
the Kanto Local Finance Bureau are reclassified for the convenience of readers outside Japan. The notes to theconsolidated financial statements include information which is not required under Japanese GAAP but is presented herein
as additional information.
The amounts indicated in millions of yen are rounded down by truncating the figures below one million. Totals may not
add up exactly because of such truncation. Amounts in U.S. dollars are included solely for the convenience of readers
outside Japan. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018 has been used for translation.
The inclusion of such amounts is not intended to imply that Japanese yen has been or could be readily converted, realized
or settled into U.S. dollars at that rate or any other rate.

2. Scope of Consolidation(a) The consolidated financial statements include the accounts of MHFG and its consolidated subsidiaries (collectively, “theGroup”), including Mizuho Bank, Ltd. (“MHBK”), Mizuho Trust & Banking Co., Ltd. (“MHTB”), Mizuho Securities Co., Ltd.
(“MHSC”) and certain other subsidiaries. The numbers of consolidated subsidiaries as of March 31, 2018 and 2017 were
124 and 139, respectively.
In the fiscal year ended March 31, 2018, Mizuho Business Succession Fund Limited Partnership was newly includedin the scope of consolidation as a result of new establishment.
During the period, MHCB America Holdings,Inc. and 15 other companies were excluded from the scope of
consolidation as a result of merger and other factors.
(b) There were no non-consolidated subsidiaries as of March 31, 2018 and 2017.

3. Application of the Equity Method(a) There were no non-consolidated subsidiaries under the equity method as of March 31, 2018 and 2017.
(b) The numbers of affiliates under the equity method as of March 31, 2018 and 2017 were 19 and 18, respectively.
Investments in affiliates include Orient Corporation, The Chiba Kogyo Bank, Ltd., Joint Stock Commercial Bank for
Foreign Trade of Vietnam and certain other affiliates.
In the fiscal year ended March 31, 2018, Exacta Asia Investment Ⅱ LP was newly included in the scope of the equity
method as a result of new establishment.
(c) There were no non-consolidated subsidiaries not under the equity method as of March 31, 2018 and 2017.
(d) Pec International Leasing Co., Ltd. ,an affiliate not under the equity method, is not accounted for under the equity
method, as it is not significant to the consolidated financial statements of MHFG.

154

Basis for Presentation、Scope of Consolidation、Application of the Equity Method

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

4. Balance Sheet Dates of Consolidated Subsidiaries(a) Balance sheet dates of consolidated subsidiaries for the fiscal year ended March 31, 2018 are as follows:
July 31
1 company
December 29
6 companies
December 31
50 companies
March 31
67 companies(b) Consolidated subsidiaries with balance sheet dates of December 29 were consolidated based on their tentative financial
statements as of and for the period ended December 31.
The consolidated subsidiary with balance sheet dates of July 31 was consolidated based on its tentative financial
statement as of and for the period ended the consolidated balance sheet date.
Other consolidated subsidiaries were consolidated based on their financial statements as of and for the period ended
their respective balance sheet dates.
The necessary adjustments have been made to the financial statements for any significant transactions that took
place between their respective balance sheet dates and the date of the consolidated financial statements.

155

Balance Sheet Dates of Consolidated Subsidiaries

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5. Standards of Accounting Method(1) Credited Loans pursuant to Trading Securities and Trading Income & Expenses
Credited loans held for the purpose of trading are, in line with trading securities, recognized on a trade date basis andrecorded in Other Debt Purchased on the consolidated balance sheet. Other Debt Purchased related to the relevant
credited loans is stated at fair value at the consolidated balance sheet date.
Interest received and the gains or losses on the sale of the relevant credited loans during the fiscal year, including thegains or losses resulting from any change in the value between the beginning and the end of the fiscal year, arerecognized in Other Operating Income and Other Operating Expenses on the consolidated statement of income.

(2)Trading Assets & Liabilities and Trading Income & Expenses
Trading transactions intended to take advantage of short-term fluctuations and arbitrage opportunities in interest rates,
currency exchange rates, market prices of securities and related indices are recognized on a trade-date basis andrecorded in Trading Assets or Trading Liabilities on the consolidated balance sheet. Income or expenses generated on
the relevant trading transactions are recorded in Trading Income or Trading Expenses on the consolidated statement ofincome.
Securities and other monetary claims held for trading purposes are stated at fair value at the consolidated balance
sheet date. Derivative financial products, such as swaps, futures and option transactions, are stated at their fair values,
assuming that such transactions are terminated and settled at the consolidated balance sheet date.
Trading Income and Trading Expenses include the interest received and paid during the fiscal year, the gains orlosses resulting from any change in the value of securities and other monetary claims between the beginning and theend of the fiscal year, and the gains or losses resulting from any change in the value of financial derivatives between the
beginning and the end of the fiscal year, assuming they were settled at the end of the fiscal year.

(3) Securities
In accordance with “Accounting Standard for Financial Instruments” (the Business Accounting Deliberation Council,
January 22, 1999), MHFG classifies securities, excluding those of investments in non-consolidated subsidiaries andaffiliates, into three categories based upon management's intent. These securities are accounted for as follows:(i) Trading securities are carried at market value and included in Trading Assets.
(ii) Bonds held to maturity are stated at amortized cost (straight-line method) and determined by the moving averagemethod.
(iii) Other securities are securities which are not classified as either trading securities or bonds held to maturity. Other
securities which have readily determinable fair value are stated at fair value with changes in net unrealized gains orlosses, net of applicable income taxes after excluding gains and losses as a result of the fair-value hedge method,
included directly in Net Assets. The fair value of Japanese stocks is determined based on the average quoted market
price over the month preceding the consolidated balance sheet date. The fair value of securities other than Japanesestocks is determined at the quoted market price if available, or other reasonable value at the consolidated balance
sheet date (cost of securities sold is calculated primarily by the moving average method). Other securities, the fairvalues of which are extremely difficult to determine, are stated at acquisition cost or amortized cost which isdetermined by the moving average method.
In addition, investments in affiliates not under the equity method are stated at acquisition cost as determined by themoving average method.
Securities which are held as trust assets in Money Held in Trust accounts are valued in the same way as Securities
above.
Certain Securities other than Trading Securities (excluding Securities for which it is deemed to be extremely difficult todetermine the fair value) are devalued to the fair value, and the difference between the acquisition cost and the fairvalue is treated as a loss for the fiscal year (“impairment (devaluation)”), if the fair value (primarily the closing market
price at the consolidated balance sheet date) has significantly deteriorated compared with the acquisition cost (including
amortized cost), and unless it is deemed that there is a possibility of a recovery in the fair value. The amounts of
impairment (devaluation) were ¥3,424 million ($32,226 thousand) and ¥1,139 million for the fiscal years ended March
31, 2018 and 2017, respectively.

156

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

The criteria for determining whether a security's fair value has “significantly deteriorated” are outlined as follows:• Security whose fair value is 50% or less of the acquisition cost
• Security whose fair value exceeds 50% but is 70% or less of the acquisition cost and the quoted market pricemaintains a certain level or lower(4) Bills Discounted
In accordance with “Accounting and Auditing Treatment relating to Adoption of Accounting Standards for Financial
Instruments for Banks” (The Japanese Institute of Certified Public Accountants (“JICPA”) Industry Audit Committee
Report No. 24), bills discounted are accounted for as financing transactions. The banking subsidiaries have rights to sellor pledge these commercial bills, foreign exchange bills purchased and others. The face value of these bills amounted
to ¥1,405,238 million ($13,223,284 thousand) and ¥1,315,137 million as of March 31, 2018 and 2017, respectively.

(5) Derivative Transactions
Derivative transactions are valued at fair value with changes in fair value included in current income. Derivatives
qualifying as hedges are mainly accounted for using either the fair-value hedge method or the deferred method of hedge
accounting (see (22) Hedge Accounting).

(6) Tangible Fixed Assets (Except for Lease Assets)
Depreciation of buildings is computed mainly by the straight-line method, and that of others is computed mainly by the
declining-balance method. The range of useful lives is as follows:
Buildings 3 years to 50 years
Others 2 years to 20 years(7) Intangible Fixed Assets (Except for Lease Assets)
Amortization of Intangible Fixed Assets is computed by the straight-line method. Development costs for internally-usedsoftware are capitalized and amortized over their estimated useful lives of mainly from five to ten years as determinedby MHFG and its consolidated subsidiaries.

(8) Lease Assets
Depreciation of lease assets booked in Tangible Fixed Assets and Intangible Fixed Assets which are concerned withfinance lease transactions that do not transfer ownership is mainly computed by the same method as the one applied to
fixed assets owned by us.

(9) Deferred Assets
Bond issuance costs are expensed as incurred.

157

Standards of Accounting Method

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(10) Reserves for Possible Losses on Loans
Reserves for Possible Losses on Loans of major domestic consolidated subsidiaries are maintained in accordance withinternally established standards for write-offs and reserve provisions:• For claims extended to obligors that are legally bankrupt under the Bankruptcy Law, Special Liquidation under theCompany Law or other similar laws (“Bankrupt Obligors”), and to obligors that are effectively in similar conditions(“Substantially Bankrupt Obligors”), reserves are maintained at the amounts of claims net of direct write-offs described
below and the expected amounts recoverable from the disposition of collateral and the amounts recoverable underguarantees.
• For claims extended to obligors that are not yet legally or formally bankrupt but are likely to be bankrupt (“Intensive
Control Obligors”), reserves are maintained at the amounts deemed necessary based on overall solvency analyses of
the amounts of claims net of expected amounts recoverable from the disposition of collateral and the amounts
recoverable under guarantees.
• For claims extended to Intensive Control Obligors and Obligors with Restructured Loans (defined in Note 12 below)
and others, if the exposure to an obligor exceeds a certain specific amount, reserves are provided as follows:(i) if future cash flows of the principal and interest can be reasonably estimated, the discounted cash flow method isapplied, under which the reserve is determined as the difference between the book value of the loan and its present
value of future cash flows discounted using the contractual interest rate before the loan was classified as a
Restructured Loan, and(ii) if future cash flows of the principal and interest cannot be reasonably estimated, reserves are provided for thelosses estimated for each individual loan.
• For claims extended to other obligors, reserves are maintained at rates derived from historical credit loss experienceand other factors.
• Reserve for Possible Losses on Loans to Restructuring Countries is maintained in order to cover possible losses
based on analyses of the political and economic climates of the countries. All claims are assessed by each claim
origination department in accordance with the internally established “Self-assessment Standard,” and the results of theassessments are verified and examined by the independent examination departments.
In the case of claims to Bankrupt Obligors and Substantially Bankrupt Obligors, which are collateralized or guaranteed
by a third party, the amounts deemed uncollectible (calculated by deducting the anticipated proceeds from the sale ofcollateral pledged against the claims and amounts that are expected to be recovered from guarantors of the claims) are
written off against the respective claim balances. The total directly written-off amounts were ¥97,112 million ($913,827
thousand) and ¥93,782 million as of March 31, 2018 and 2017, respectively.
Other consolidated subsidiaries provide the amount necessary to cover the loan losses based upon past experienceand other factors for general claims and the assessment for each individual loan for other claims.

(11) Reserve for Possible Losses on Investments
Reserve for Possible Losses on Investments is maintained to provide against possible losses on investments insecurities, after taking into consideration the financial condition and other factors concerning the investee company.

(12) Reserve for Bonus Payments
Reserve for Bonus Payments, which is provided for future bonus payments to employees, is maintained at the amountaccrued at the end of the fiscal year, based on the estimated future payments.

(13) Reserve for Variable Compensation
To prepare for the payments of performance payments and stock compensation to be paid as variable compensation
within compensation for directors, executive officers and specialist officers of Mizuho Financial Group, Inc., Mizuho
Bank, Ltd., Mizuho Trust & Banking Co., Ltd., and Mizuho Securities Co., Ltd., the estimated payment based on thestandard amount regarding variable compensation of the fiscal year is provided.

(14) Reserve for Director and Corporate Auditor Retirement Benefits
Reserve for Director and Corporate Auditor Retirement Benefits, which is provided for future retirement benefit
payments to directors, corporate auditors, and executive officers, is recognized at the amount accrued by the end of the
fiscal year, based on the internally established standards.

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(15) Reserve for Possible Losses on Sales of Loans
Reserve for Possible Losses on Sales of Loans is provided for possible future losses on sales of loans at the amountdeemed necessary based on a reasonable estimate of possible future losses.

(16) Reserve for Contingencies
Reserve for Contingencies is maintained to provide against possible losses from contingencies which are not coveredby other specific reserves. The balance is an estimate of possible future losses considered to require a reserve.

(17) Reserve for Reimbursement of Deposits
Reserve for Reimbursement of Deposits is provided against the losses for the deposits derecognized from liabilities atthe estimated amount of future claims for withdrawal by depositors.

(18) Reserve for Reimbursement of Debentures
Reserve for Reimbursement of Debentures is provided for the debentures derecognized from liabilities at the estimatedamount for future claims.

(19) Reserve under Special Laws
Reserve under Special Laws is Reserve for Contingent Liabilities from Financial Instruments and Exchange of ¥2,361
million ($22,218 thousand) and ¥2,309 million as of March 31, 2018 and 2017, respectively. This is the reserve pursuant
to Article 46-5 of the Financial Instruments and Exchange Law and Article 175 of the Cabinet Office Ordinanceregarding Financial Instruments Business, etc. to indemnify the losses incurred from accidents in the purchase and saleof securities, other transactions or derivative transactions.

(20) Accounting Method for Retirement Benefits
In calculating retirement benefit obligations, a benefit formula basis is used as a method of attributing expected
retirement benefits to the period up to the end of this fiscal year. Unrecognized actuarial differences are recognized asincome or expenses from the following fiscal year under the straight-line method over a certain term within the averageremaining service period of the employees (mainly 10 years) of the respective fiscal years.
Certain consolidated subsidiaries apply the simplified method that assumes the amount required for voluntary
resignation at the end of the term to be retirement benefit obligations in computing net defined benefit liability andretirement benefit expenses.

(21) Assets and Liabilities Denominated in Foreign Currencies
Assets and liabilities denominated in foreign currencies and accounts of overseas branches of domestic consolidatedbanking subsidiaries and a domestic consolidated trust banking subsidiary are translated into Japanese yen primarily atthe exchange rates in effect at the consolidated balance sheet date, with the exception of the investments in affiliates
not under the equity method, which are translated at historical exchange rates.
Assets and liabilities denominated in foreign currencies of the consolidated subsidiaries, except for the transactions
mentioned above, are translated into Japanese yen primarily at the exchange rates in effect at the respective balance
sheet dates.

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2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(22) Hedge Accounting(a) Interest Rate Risk
The deferred method, the fair-value hedge method or the exceptional accrual method for interest rate swaps areapplied as hedge accounting methods.
The portfolio hedge transaction for a large volume of small-value monetary claims and liabilities of domestic
consolidated banking subsidiaries and some of domestic consolidated trust banking subsidiaries is accounted for by
the method stipulated in the JICPA Industry Audit Committee Report No.24, February 13, 2002.
The effectiveness of hedging activities for the portfolio hedge transaction for a large volume of small-valuemonetary claims and liabilities is assessed as follows:(i) as for hedging activities to offset market fluctuation risks, the effectiveness is assessed by bracketing both thehedged instruments, such as deposits and loans, and the hedging instruments, such as interest-rate swaps, inthe same maturity bucket.
(ii) as for hedging activities to fix the cash flows, the effectiveness is assessed based on the correlation between thebase interest rate index of the hedged instrument and that of the hedging instrument.
The effectiveness of the individual hedge is assessed based on the comparison of the fluctuation in the market orof cash flows of the hedged instruments with that of the hedging instruments.
(b) Foreign Exchange Risk
Domestic consolidated banking subsidiaries and some of domestic consolidated trust banking subsidiaries apply thedeferred method of hedge accounting to hedge foreign exchange risks associated with various financial assets andliabilities denominated in foreign currencies as stipulated in the “Accounting and Auditing Treatment relating to
Adoption of Accounting Standards for Foreign Currency Transactions for Banks” (JICPA Industry Audit Committee
Report No.25, July 29, 2002). The effectiveness of the hedge is assessed by confirming that the amount of theforeign currency position of the hedged monetary claims and liabilities is equal to or larger than that of currency swap
transactions, exchange swap transactions, and similar transactions designated as the hedging instruments of theforeign exchange risk.
In addition to the above methods, these subsidiaries apply the deferred method or the fair-value hedge method toportfolio hedges of the foreign exchange risks associated with investments in subsidiaries and affiliates denominatedin foreign currency and Other securities denominated in foreign currency (except for bonds) identified as hedged
items in advance, as long as the amount of foreign currency payables of spot and forward foreign exchange
contracts exceeds the amount of acquisition cost of the hedged foreign securities denominated in foreign currency.
(c) Inter-company Transactions
Inter-company interest rate swaps, currency swaps and similar derivatives among consolidated companies or
between trading accounts and other accounts, which are designated as hedges, are not eliminated and related gains
and losses are recognized in the statement of income or deferred under hedge accounting, because these intercompany derivatives are executed according to the criteria for appropriate outside third-party cover operations which
are treated as hedge transactions objectively in accordance with JICPA Industry Audit Committee Reports No.24 and25.
As for certain assets and liabilities of MHFG and its consolidated subsidiaries, the deferred method, the fair-value
hedge method or the exceptional accrual method for interest rate swaps are applied.

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(23) Consumption Taxes and OtherWith respect to MHFG and its domestic consolidated subsidiaries, Japanese consumption taxes and local consumption
taxes are excluded from transaction amounts.

(24) Amortization Method of Goodwill and Amortization Period
Goodwill is amortized over an appropriate period not to exceed 20 years under the straight-line method. The full amountof Goodwill that has no material impact is expensed as incurred.

(25) Scope of Cash and Cash Equivalents on Consolidated Statement of Cash Flows
In the consolidated statement of cash flows, Cash and Cash Equivalents consist of cash and due from central banks
included in “Cash and Due from Banks” on the consolidated balance sheet.

6. Issued but not yet Adopted Accounting Standard and Others
・ Accounting Standard for Revenue Recognition (Accounting Standards Board of Japan ("ASBJ") Statement No.29, March 30,
2018)・Implementation Guidance on Accounting Standard for Revenue Recognition (ASBJ Guidance No.30, March 30, 2018)(1) Overview
International Accounting Standards Board ("IASB") and Financial Accounting Standards Board ("FASB") jointly establishedthe comprehensive accounting standard for revenue recognition and announced "Revenue from contracts with customers"(International Financial Reporting Standards ("IFRS") 15 / FASB Topic 606). Considering the application of IFRS 15 from thefiscal year beginning on and after January 1, 2018 and Topic 606 from the fiscal year beginning after December 15, 2017,
ASBJ has established the comprehensive accounting standard for revenue recognition and announced the accounting
standard together with the guidance.
As a basic policy of ASBJ in establishing the accounting standard for revenue recognition, the accounting standard wasdetermined with the adoption of the basic principles of IFRS 15 at first from the standpoint of the comparability between
financial statements that is one of conveniences provided by ensuring consistency with IFRS 15. If there were items thatshould give consideration to practical businesses conducted in Japan, the alternative treatment shall be added as long as
comparability is not harmed.
(2) Scheduled Date of Application
Mizuho Financial Group is scheduled to apply this accounting standard from the beginning of the consolidated fiscal year
starting on April 1, 2021.
(3) Effect of Application of this accounting standard
The effect of the application of this accounting standard is under consideration.

7. Change in Presentation of Financial Statements
Refund of Income Taxes separately presented for the previous consolidated fiscal year has been included within Current
Income Taxes from this consolidated fiscal year due to decreased materiality. In order to reflect the change in presentation offinancial statements, reclassification of the previous consolidated fiscal year has been made accordingly.
As a result, Refund of Income Taxes of ¥(3,259) million presented in the consolidated statement of income for the previous
consolidated fiscal year has been reclassified as Current Income Taxes.

161Standards of Accounting Method、Issued but not yet Adopted Accounting Standard and Others、Change in Presentation of Financial Statements

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8. Additional Information(The Board Benefit Trust (“BBT”) Program)Since MHFG operates its business giving due regard to creating value for diverse stakeholders and realizing improved
corporate value through the continuous and stable growth of MHFG group pursuant to MHFG’s basic management policy
defined under the Mizuho Financial Group’s Corporate Identity, MHFG has introduced a performance-based stockcompensation program using a trust (the “Program”) that functions as an incentive for each Director, Executive Officer, andSpecialist Officer to exert maximum effort in performing his or her duties, and also as consideration for such exertion of effort.
(1) Outline of the Program
The Program has adopted the Board Benefit Trust (“BBT”) framework. MHFG’s shares on the stock market will be acquired
through a trust established based on the underlying funds contributed by MHFG, and MHFG’s shares will be distributed to
Directors, Executive Officers, and Specialist Officers of MHFG, Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd., andMizuho Securities Co., Ltd. (the “Company Group”) in accordance with the Rules on Distribution of Shares to be prescribed inadvance. The number of MHFG’s shares to be distributed will be determined pursuant to a performance evaluation based on
the annual business plan.
A structure has been introduced for the distribution of MHFG’s shares under the Program, whereby the distribution will bedeferred over three years, and the deferred portion will be subject to reduction or forfeiture depending on certain factors,
including the performance of the Company Group or the relevant Directors, Executive Officers, and Specialist Officers.
Voting rights related to MHFG’s shares belonging to the trust assets under the trust shall not be exercised.
(2) MHFG’s Shares Outstanding in the Trust
MHFG’s shares outstanding in the trust are recognized as Treasury Stock under Net Assets at the carrying amount(excluding the amount of incidental expenses) in the trust. The carrying amount of such Treasury Stock as of March 31, 2018was ¥2,424 million for 13,319 thousand shares. (The carrying amount of such Treasury Stock as of March 31, 2017 was¥1,428 million for 9,000 thousand shares.)

9 . Securities Lending and Borrowing Transactions
MHFG does not have unsecured loaned securities which the borrowers have the right to sell or repledge as of March 31,2018 and 2017. MHFG has the right to sell or repledge some of unsecured borrowed securities, securities purchased
under resale agreements and securities borrowed with cash collateral. Among them, the totals of securities repledged
were ¥12,656,065 million ($119,093,495 thousand) and ¥13,471,535 million as of March 31, 2018 and 2017,
respectively, and securities neither repledged nor re-loaned were ¥1,048,102 million ($9,862,637 thousand) and¥675,330 million as of March 31, 2018 and 2017, respectively.

10. Trading Assets and Liabilities
As of March 31,

Trading Assets:
Trading Securities
Derivatives for Trading
Transactions
Derivatives for Trading Securities
Total
Trading Liabilities:
Trading Securities Sold Short
Derivatives for Trading
Transactions
Derivatives for Trading Securities
Total

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥ 5,188,400¥ 4,800,408$ 48,822,813

5,065,683
253,049¥ 10,507,133

5,409,525
151,853¥ 10,361,787

47,668,045
2,381,195$ 98,872,053¥ 3,185,101¥ 2,221,541$ 29,971,783

4,759,793
176,648¥ 8,121,543

5,475,724
226,019¥ 7,923,285

44,789,623
1,662,263$ 76,423,669

162

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

11. Securities
Millions of yen
2018

As of March 31,

Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Japanese Stocks*1
Other*2
Total¥ 15,292,004
239,333
99
2,964,110
3,952,789
11,734,696¥ 34,183,033

2017

Thousands of U.S. dollars
2018¥ 13,324,305
284,47299
2,696,287
3,958,439
12,089,553¥ 32,353,158$ 143,897,658
2,252,128
941
27,892,256
37,195,719
110,423,420$ 321,662,122*1 Japanese Stocks included investments in non-consolidated subsidiaries and affiliates of ¥178,472 million ($1,679,425 thousand) and ¥238,208 million as ofMarch 31, 2018 and 2017, respectively.
*2 Other included investments in non-consolidated subsidiaries and affiliates of ¥76,913 million ($723,756 thousand) and ¥76,405 million as of March 31, 2018and 2017, respectively.

12. Loans and Bills Discounted
Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥ 68,615,165
7,369,547
2,963,152
287,692¥ 67,456,670
7,487,574
2,754,696
285,395$ 645,668,255
69,347,391
27,883,248
2,707,184

180,974
4,941¥ 79,421,473

348,514
4,941¥ 78,337,793

1,702,967
46,501$ 747,355,546

As of March 31,

Loans on Deeds
Overdrafts
Loans on Notes
Bills Discounted
Financing Receivables, including
Factoring, Leasing and Property
Financing
Other
Total

Loans and Bills Discounted as of March 31, 2018 and 2017 include the following:
Millions of yen
2018

As of March 31,

Loans to Bankrupt Obligors*1
Non-Accrual Delinquent Loans*2
Loans Past Due for Three Months or More*3
Restructured Loans*4
Total¥ 21,271
332,702617
240,777¥ 595,369

2017

Thousands of U.S. dollars
2018¥ 33,330
430,525
7,896
414,700¥ 886,452$

200,167
3,130,728
5,809
2,265,718$ 5,602,422*1 Loans to Bankrupt Obligors represent non-accrual loans to obligors who are legally bankrupt as defined in Article 96, Paragraph 1, Items 3 and 4 of the

Corporate Tax Law Enforcement Ordinance (Government Ordinance No.97, 1965).
*2 Non-Accrual Delinquent Loans represent non-accrual loans other than (i) Loans to Bankrupt Obligors and (ii) loans of which payments of interest are

deferred in order to assist or facilitate the restructuring of obligors in financial difficulties.
*3 Loans to Bankrupt Obligors or Non-Accrual Delinquent Loans, both of which are classified as non-accrual, are not included in this category.
*4 Restructured Loans represent loans on which contracts were amended in favor of obligors (e.g., the reduction of or exemption from stated interest, thedeferral of interest payments, the extension of maturity dates, or renunciation of claims) in order to assist or facilitate the restructuring of obligors in financial
difficulties.
Note: The amounts given in the above table are gross amounts before deduction of amounts for the Reserves for Possible Losses on Loans.

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Commitment Line for Loans
Overdraft protection on current accounts and contracts of the commitment line for loans are contracts by which banking
subsidiaries are bound to extend loans up to the prearranged amount, at the request of customers, unless the customer isin breach of contract conditions. The unutilized balance of these contracts amounted to ¥92,936,908 million ($874,535,692
thousand) and ¥91,657,478 million as of March 31, 2018 and 2017, respectively. Of these amounts, ¥73,190,124 million($688,718,591 thousand) and ¥71,552,248 million as of March 31, 2018 and 2017, respectively, relate to contracts of which
the original contractual maturity is one year or less, or which are unconditionally cancelable at any time.
Since many of these contracts expire without being exercised, the unutilized balance itself does not necessarily affectfuture cash flows. A provision is included in many of these contracts that entitles the banking subsidiaries to refuse theexecution of loans, or reduce the maximum amount under contracts when there is a change in the financial situation,necessity to preserve a claim, or other similar reasons. The banking subsidiaries require collateral such as real estate andsecurities when deemed necessary at the time the contracts are entered into. In addition, they periodically monitor
customers’ business conditions in accordance with internally established standards and take necessary measures tomanage credit risks such as amendments to contracts.

13. Foreign Exchange Assets and Liabilities
Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥ 1,117,545
529,924
287,479
6,727¥ 1,941,677¥ 1,029,741
453,929
344,764347¥ 1,828,782$ 10,516,100
4,986,590
2,705,176
63,303$ 18,271,169

¥

¥

¥

467,017
13,74739,767
5,521
526,053$ 3,701,620
227,105
171,369
94,927$ 4,195,021

Millions of yen
2018

2017

Thousands of U.S. dollars
2018

270,538
47,8483,861,952¥ 4,180,339$ 2,829,504
508,332
39,839,777$ 43,177,613

As of March 31,

Foreign Exchange Assets:
Foreign Bills Bought
Foreign Bills Receivable
Due from Banks (Foreign)
Advance to Foreign Banks
Total
Foreign Exchange Liabilities:
Due to Banks (Foreign)
Advance from Foreign Banks
Foreign Bills Payable
Foreign Bills Sold
Total

393,371
24,134
18,211
10,087¥ 445,804

14. Other Assets
As of March 31,

Accrued Income
Prepaid Expenses
Other
Total

¥

300,691
54,0204,233,773¥ 4,588,484¥

164

Loans and Bills Discounted、Foreign Exchange Assets and Liabilities、Other Assets

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

15. Tangible Fixed Assets
Millions of yen
2018

2017

Thousands of U.S. dollars
2018641,284
348,068
26,21022,134
98,631¥ 1,136,329¥ 858,561$ 5,917,349
3,213,833
239,655
235,022849,854$ 10,455,713$ 8,276,070

33,215

321,6382017

Thousands of U.S. dollars
2018¥ (200,616)¥ (344,741)$ (1,887,798)(115,004)(164,430)(1,082,188)(1)¥ (315,621)(2)¥ (509,175)(11)$ (2,969,997)

As of March 31,

Land
Buildings
Lease Assets
Construction in Progress
Other
Total
Accumulated Depreciation
Book Value Adjusted for Gains on
Sales of Replaced Assets andOthers¥628,836
341,533
25,46824,97590,314¥ 1,111,128¥ 879,497¥

34,18016. Reserves for Possible Losses on Loans
Millions of yen
2018

As of March 31,

General Reserve for Possible
Losses on Loans
Specific Reserve for Possible
Losses on Loans
Reserve for Possible Losses on
Loans to Restructuring Countries
Total

17. Assets Pledged as Collateral
The following assets were pledged as collateral:
Millions of yen
2018

As of March 31,

Trading Assets
Securities
Loans and Bills Discounted¥ 1,590,718
6,712,488
4,976,680

2017

Thousands of U.S. dollars
2018¥ 1,882,123
8,425,757
7,128,930$ 14,968,648
63,164,473
46,830,528

The following liabilities were collateralized by the above assets:
Millions of yen
2018

As of March 31,

Deposits
Payables under Repurchase
Agreements
Guarantee Deposits Received
under Securities Lending
Transactions
Borrowed Money

¥

2017

Thousands of U.S. dollars
2018

918,743$ 2,409,218

5,518,102

6,109,314

51,925,307

984,830
3,524,825

1,219,762
4,810,490

9,267,251
33,168,583

256,027

165

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In addition, the settlement accounts of foreign and domestic exchange transactions or derivatives transactions and others
were collateralized, and margins for futures transactions were substituted by Cash and Due from Banks of ¥33,434 million($314,617 thousand) and ¥45,404 million, Trading Assets of ¥53,750 million ($505,795 thousand) and ¥126,225 million,
Securities of ¥3,270,531 million ($30,775,678 thousand) and ¥3,919,060 million, and Loans and Bills Discounted of¥154,190 million ($1,450,927 thousand) and ¥238,686 million as of March 31, 2018 and 2017, respectively.
Other Assets included guarantee deposits of ¥132,084 million ($1,242,914 thousand) and ¥128,941 million, collateralpledged for derivatives transactions of ¥718,276 million ($6,758,980 thousand) and ¥769,243million, margins for futurestransactions of ¥140,600 million ($1,323,051 thousand) and ¥269,376 million, and other guarantee deposits of ¥968,443
million ($9,113,048 thousand) and ¥337,778 million as of March 31, 2018 and 2017, respectively.

18. Deposits
Millions of yen
2018

As of March 31,

Current Deposits
Ordinary Deposits*1
Deposits at NoticeTime Deposits
Negotiable Certificates of Deposit
Other
Total

¥ 11,713,590
69,837,590
930,730
36,901,106
11,382,590
5,698,216¥ 136,463,824

2017

Thousands of U.S. dollars
20189,983,448
64,356,023
1,025,510
39,176,701
10,631,277
5,503,533¥ 130,676,494$ 110,224,807
657,171,271
8,758,165
347,239,170
107,110,101
53,620,175$ 1,284,123,689¥*1 Ordinary Deposits includes savings deposits.

19. Call Money and Bills Sold
Millions of yen
2018

As of March 31,

Call Money
Bills Sold
Total

¥ 2,105,293—¥ 2,105,293

2017

Thousands of U.S. dollars
2018¥ 1,255,172—¥ 1,255,172$ 19,810,801—$ 19,810,801

20. Commercial Paper
As of March 31,

Commercial Paper

Millions of yen
2018¥710,391

2017

Thousands of U.S. dollars
2018¥789,705$6,684,778

Average interest rates*1
2018
2017

1.92%

1.10%

*1 Average interest rates are the weighted-average interest rates of debts calculated from the interest rates and outstanding balances at the end of the fiscal

year.

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

21. Borrowed Money
Millions of yen
2018

As of March 31,¥4,896,218―
4,896,218

Borrowed Money
Bills Rediscounted
Other Borrowings*2,3

2017

Thousands of U.S. dollars
2018¥6,307,230―
6,307,230$46,073,388―$46,073,388

Average interest rates*1
2018
2017

0.63%
―%
0.63%

0.38%
―%
0.38%

*1 Average interest rates are the weighted-average interest rates of debts calculated from the interest rates and outstanding balances at the end of the fiscal

year.
*2 Other Borrowings included subordinated debt of ¥218,000 million ($2,051,379 thousand) and ¥252,000 million as of March 31, 2018 and 2017, respectively.
*3 Repayments for Other Borrowings are scheduled for the next five years as follows:

Fiscal year ending March 31, 2019
2020
2021
2022
2023

¥2,221,554 million¥636,522 million¥905,073 million¥125,318 million¥184,092 million($20,904,810 thousand)($5,989,671 thousand)($8,516,736 thousand)($1,179,244 thousand)($1,732,310 thousand)

22. Short-term Bonds
Major components of Short-term Bonds at March 31, 2018 were as follows:
Issuer

Issue

MHSC

Aug. 2017–Mar. 2018*1

Oct. 2017–Mar. 2018

Total

Millions of yen Thousands of U.S. dollars

334,200[334,200]
27,985[27,985]¥362,185

3,144,820[3,144,820]
263,342[263,342]$3,408,162

Interest rates

0.00%
0.04%–0.11%

Due

Apr. 2018–
Sep. 2018
Apr. 2018–
May 2018*1 indicates the total amount of Short-term Bonds issued by the domestic consolidated subsidiary, Allstar Funding Co., Ltd, and the overseas consolidated

subsidiary, JAPAN SECURITIZATION CORPORATION.

Notes: 1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. No collateral was provided for the above Short-term Bonds.
Major components of Short-term Bonds at March 31, 2017 were as follows:
Issuer

Issue

MHFG

Jan. 2017

MHSC

Apr. 2016–Mar. 2017

*1Oct. 2016–Mar. 2017

Total

Millions of yen

Interest rates¥80,000[80,000]
111,300[111,300]
35,048[35,048]¥226,348

0.02%

Apr. 2017

0.00%–0.01%

Apr. 2017–
Sep. 2017
Apr. 2017–
May 2017

0.02%–0.10%Due*1 indicates the total amount of Short-term Bonds issued by the domestic consolidated subsidiary, Allstar Funding Co., Ltd, and the overseas consolidated

subsidiary, JAPAN SECURITIZATION CORPORATION.

Notes: 1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. No collateral was provided for the above Short-term Bonds.

167

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23. Bonds and Notes
Major components of Bonds and Notes as of March 31, 2018 were as follows:

IssuerDescription

Issue

MHFG

Straight Bonds

Jul. 2014–
Mar.2018

MHTB

Straight Bonds

Dec. 2005

MHBK

Straight Bonds

Aug. 2005–
Jan. 2018*1

Straight Bonds

Jul. 2012–
Mar. 2014*2

Straight Bonds*3

Straight Bonds

Sep. 2005–
May 2012
Jan. 2003–
Mar. 2018

Total

Millions of yen¥3,869,015[—](US$ 17,500,000 thousand)(EUR 500,000 thousand)
10,000[—]2,421,033[513,026](US$ 10,546,418 thousand)(AUD 1,115,000 thousand)(SGD 290,000 thousand)(HKD 1,430,000 thousand)(CNY 500,000 thousand)(THB 3,000,000 thousand)
318,325[—](US$ 2,995,443 thousand)
45,000[—]880,881[227,933](US$ 2,417,770 thousand)(AUD 24,550 thousand)(EUR 998,900 thousand)(BRL 14,500 thousand)(GBP 20,000 thousand)(MXN 9,000 thousand)(TRY 51,076 thousand)¥7,544,256

Thousands of U.S.
dollars

Interest
rates$36,407,406[—]

0.10%–
4.35%

Apr. 2021–

94,100[—]22,781,913[4,827,576]

2.24%

Dec. 2020

0.22%–
5.30%

Apr. 2018–

2,995,443[—]

4.20%–
4.60%

Jul. 2022–
Mar. 2024

423,450[—]
8,289,091[2,144,854]

1.30%–
2.75%
0.00%–
19.00%

Jun. 2023–

Due

Apr. 2018–
Mar. 2048$70,991,403*1 indicates the total amount of straight bonds issued by the overseas consolidated subsidiaries, Mizuho Financial Group (Cayman) 2 Limited and Mizuho

Financial Group (Cayman) 3 Limited.
*2 indicates the total amount of straight bonds issued by the overseas consolidated subsidiaries, Mizuho Finance (Cayman) Limited, Mizuho Finance (Curaçao)

N.V. and Mizuho Finance (Aruba) A.E.C.
*3 indicates the total amount of straight bonds issued by the domestic consolidated subsidiary, MHSC, and the overseas consolidated subsidiaries, Mizuho

International plc and Mizuho Securities USA LLC.

Notes: 1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. The amounts of foreign currency-denominated bonds are shown in original currencies in parentheses ( ).
3. Repayments for Bonds and Notes are scheduled for the next five years as follows:
Fiscal year ending March 31, 2019 ¥740,960 million ($6,972,430 thousand)2020 ¥849,535 million ($7,994,119 thousand)2021 ¥296,237 million ($2,787,589 thousand)2022 ¥1,021,008 million ($9,607,683 thousand)2023 ¥862,446 million ($8,115,616 thousand)4. Bonds and Notes as of March 31, 2018 included subordinated bonds and notes of ¥2,810,028 million($26,442,347 thousand).
5. No collateral was provided for the above Bonds and Notes.

168

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Major components of Bonds and Notes as of March 31, 2017 were as follows:

IssuerDescription

Issue

MHFG

Straight Bonds

MHTB

Straight Bonds

Jul. 2014–
Oct. 2017
Dec. 2005

MHBK

Straight Bonds

Aug. 2005–
Mar. 2017*1

Straight Bonds

Jul. 2012–
Mar. 2014*2

Straight Bonds*3

Straight Bonds

Sep. 2005–
May 2012
Jan. 2003–
Mar. 2017

Total

Millions of yen¥2,632,250[—]
10,000[—]3,726,331[1,264,044](US$ 15,913,528 thousand)(AUD 1,170,000 thousand)(SGD 290,000 thousand)(HKD 1,430,000 thousand)(CNY 250,000 thousand)(THB 3,000,000 thousand)
335,991[—](US$ 2,994,577 thousand)
47,600[—]812,362[150,786](US$ 1,572,350 thousand)(AUD 30,060 thousand)(EUR 895,400 thousand)(BRL 14,500 thousand)¥7,564,535

Interest
rates

0.10%–
4.35%
2.24%

Due

Apr. 2021–
Dec. 2020

0.20%–
4.78%

Apr. 2017–4.20%–
4.60%

Jul. 2022–
Mar. 2024

1.30%–
2.75%
0.00%–
23.80%

Jun. 2018–
Apr. 2017–
Mar. 2047*1 indicates the total amount of straight bonds issued by the overseas consolidated subsidiaries, Mizuho Financial Group (Cayman) Limited, Mizuho Financial

Group (Cayman) 2 Limited and Mizuho Financial Group (Cayman) 3 Limited.
*2 indicates the total amount of straight bonds issued by the overseas consolidated subsidiaries, Mizuho Finance (Cayman) Limited, Mizuho Finance (Curaçao)

N.V. and Mizuho Finance (Aruba) A.E.C.
*3 indicates the total amount of straight bonds issued by the domestic consolidated subsidiary, MHSC, and the overseas consolidated subsidiaries, Mizuho

International plc and Mizuho Securities USA Inc.

Notes: 1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. The amounts of foreign currency-denominated bonds are shown in original currencies in parentheses ( ).
3. Repayments for Bonds and Notes are scheduled for the next five years as follows:
Fiscal year ending March 31, 2018 ¥1,414,830 million
2019 ¥648,802 million
2020 ¥837,267 million
2021 ¥262,480 million
2022 ¥1,068,917 million
4. Bonds and Notes as of March 31, 2017 included subordinated bonds and notes of ¥2,430,741 million.
5. No collateral was provided for the above Bonds and Notes.

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24. Other Liabilities
Millions of yen
2018

As of March 31,

Accrued Expenses
Unearned Income
Income Taxes Payable
Lease Liabilities*1*2
Other
Total

¥223,537
116,486
66,36336,0093,243,188¥3,685,585

2017

Thousands of U.S. dollars
2018¥201,532
129,676
71,63540,9473,439,377¥3,883,168$2,103,487
1,096,139
624,478
338,851
30,518,384$34,681,339. It is the weighted-average interest rate of debts*1 Average interest rate is 1.35% and 1.41% in the fiscal year ended March 31, 2018 and 2017, respectively

calculated from the interest rates and outstanding balances at the end of the fiscal year.
*2 Repayments for Lease Liabilities are scheduled for the next five years as follows:
Fiscal year ending March 31, 2019 ¥11,590 million ($109,062 thousand)
2020¥9,640 million ($90,719 thousand)
2021¥7,096 million ($66,782 thousand)
2022¥4,240 million ($39,905 thousand)
2023¥2,470 million ($23,244 thousand)

25. Reserve for Employee Retirement Benefits(1) MHFG and its domestic consolidated subsidiaries have adopted the Corporate Pension Fund Plans (“Kigyo Nenkin Kikin
Seido”), and the Termination Allowance Plans (“Taishoku Ichijikin Seido”) as Defined-Benefit Corporate Pension Plans.
In addition, MHFG and certain domestic consolidated subsidiaries have adopted Defined- Contribution Pension Plans
other than risk-sharing corporate pension as a part of the Termination Allowance Plans while certain other domestic
consolidated subsidiaries have established employee retirement benefit trusts.
(2) Defined-Benefit Corporate Pension Plans(i) Adjustment between the balances of Retirement Benefit Obligations at the beginning and at the end of the period
For the Fiscal Years ended March 31,

Balance of Retirement Benefit Obligations
at the beginning of the period
Service Cost
Interest Cost
Unrecognized Actuarial Differences incurred
Retirement Benefits paid
Other
Balance of Retirement Benefit Obligations
at the end of the period

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥1,433,371
41,646
5,737
29,152(67,267)(1,256)¥1,465,148
44,3404,686(15,851)(66,837)
1,884$13,488,018
391,889
53,991
274,330(632,988)(11,827)¥1,441,383¥1,433,371$13,563,413

Note: The above Retirement Benefit Obligations includes the amount measured by certain consolidated subsidiaries under
the simplified method.

170

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(ii) Adjustment between the balances of Plan Assets at the beginning and at the end of the period
For the Fiscal Years ended March 31,

Balance of Plan Assets
at the beginning of the period
Expected Return on Plan Assets
Unrecognized Actuarial Differences incurred
Contributions from employer
Contributions from employee
Retirement Benefits paid
Cancellation of Employee Retirement Benefit
Trust
Other
Balance of Plan Assets at the end of theperiodMillions of yen
2018

2017

Thousands of U.S. dollars
2018¥2,175,897
33,609245,662
42,863
1,232(51,907)¥2,060,062
34,86280,40750,095
1,215(50,972)$20,475,180
316,262
2,311,686
403,347
11,600(488,454)(66,565)―(626,380)(2,125)

226(19,998)¥2,378,667¥2,175,897$22,383,243(iii) Adjustment between the balances of Retirement Benefit Obligations and Plan Assets at the end of the period andAdjustment to the balances of Net Defined Benefit Liability and Net Defined Benefit Asset recorded in the Consolidated
Balance Sheet
As of March 31,

Retirement Benefit Obligations
Plan Assets
Net amount of Liability and Asset recordedin the Consolidated Balance Sheet

As of March 31,

Net Defined Benefit Liability
Net Defined Benefit Asset
Net amount of Liability and Asset recordedin the Consolidated Balance Sheet

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥1,441,383(2,378,667)¥1,433,371(2,175,897)$13,563,413(22,383,243)¥(937,283)¥(742,525)$(8,819,830)

2017

Thousands of U.S. dollars
2018¥58,890(996,173)¥55,236(797,762)$554,160(9,373,990)¥(937,283)¥(742,525)$(8,819,830)

2017

Thousands of U.S. dollars
2018¥40,549
5,737(33,609)23,824
3,887¥43,302
4,686(34,862)
38,6993,659$381,570
53,991(316,262)
224,189
36,584¥40,390¥55,485$380,072¥(26,032)¥―$(244,964)

Millions of yen
2018(iv) Employee Retirement Benefit Expenses and the breakdown
For the Fiscal Years ended March 31,

Service Cost
Interest Cost
Expected Return on Plan Assets
Amortization of Unrecognized Actuarial Differences
Other
Net Retirement Benefit Expenses for DefinedBenefit Corporate Pension Plans
Gains on Cancellation of Employee
Retirement Benefit Trust

Millions of yen
2018

Notes: 1. The amount of employee contributions to Mizuho Pension Fund is deducted from Service Cost.
2. Retirement benefit expenses of some consolidated subsidiaries which adopt the simplified method for calculating
retirement benefit obligations are included in Service Cost in full.
3. Gains on Cancellation of Employee Retirement Benefit Trust is included in Other Income.

171

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2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(v) Remeasurements of Defined Benefit Plans in Other Comprehensive Income
Breakdown of Remeasurements of Defined Benefit Plans in Other Comprehensive Income (before deducting tax effect)
was as follows:
For the Fiscal Years ended March 31,

Unrecognized Actuarial Differences
Other
Total

Millions of yen
2018¥(216,485)
312¥(216,172)

2017

Thousands of U.S. dollars
2018¥(134,780)―¥(134,780)$(2,037,128)
2,944$(2,034,184)(vi) Remeasurements of Defined Benefit Plans in Total Accumulated Other Comprehensive Income
Breakdown of Remeasurements of Defined Benefit Plans in Total Accumulated Other Comprehensive Income (before
deducting tax effect) was as follows:

As of March 31,

Unrecognized Actuarial Differences
Other
Total

Millions of yen
2018¥(418,093)
312¥(417,780)

2017

Thousands of U.S. dollars
2018¥(201,608)―¥(201,608)$(3,934,258)
2,944$(3,931,314)(vii) Plan Assets(a) Ratio of each category to the total amount of Plan Assets was as follows:
As of March 31,

Japanese Stocks
Japanese Bonds
Foreign Stocks
Foreign Bonds
General account of life insurance companies
Other
Total

2018

2017

58.86%
13.27%
10.54%
8.84%
4.62%
3.87%
100.00%56.65%
17.03%
12.49%
4.51%
5.72%
3.60%
100.00%Note: The total amount of Plan Assets includes 59.64% and 57.28% of Employee Retirement Benefit Trust established for
the Corporate Pension Fund Plans and the Termination Allowance Plans as of March 31, 2018 and 2017,
respectively.
(b) Calculation of Expected Long-term Rate of Return on Plan Assets
In determining the Expected Long-term Rate of Return on Plan Assets, current and expected allocation of Plan Assets
and current and expected future long-term rate of return from various assets constituting Plan Assets have been
considered.
(viii) Basis of Actuarial Calculation
Major Basis of Actuarial Calculation
For the Fiscal Years ended March 31,

Discount Rate
Expected Long-term Rate of Return on Plan Assets

2018

2017

mainly 0.02%- 0.98%
mainly 1.20%- 1.75%

mainly 0.02%- 1.09%
mainly 1.47%- 1.90%(3) Defined- Contribution Pension Plans
The required amount of contributions to Defined- Contribution Pension Plans of MHFG and its domestic consolidated
subsidiaries was ¥2,473 million ($ 23,276 thousand) and ¥3,186 million for the fiscal years ended March 31, 2018 and2017, respectively.

172

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

26. Acceptances and Guarantees(1) All commitments and contingent liabilities of a material nature resulting from guarantees or otherwise are included in thecontra-accounts Acceptances and Guarantees and Customers' Liabilities for Acceptances and Guarantees.
The outstanding balances of the accounts were as follows:

As of March 31,

Guarantees
Letters of Credit
Acceptances
Total

Millions of yen
2018¥5,540,355
125,498
57,332¥5,723,186

2017

Thousands of U.S. dollars
2018¥5,083,740
138,81751,023¥5,273,581$52,134,708
1,180,943
539,497$53,855,148

Note: Liabilities for guarantees on corporate bonds included in Securities, which were issued by private placement (Article
2, Paragraph 3 of the Financial Instruments and Exchange Law (the Securities and Exchange Law as of March 31,2007)) amounted to ¥1,309,432 million ($12,321,747 thousand) and ¥1,169,267 million as of March 31, 2018 and2017, respectively.
(2) The principal amounts promised to be indemnified for money trusts which are entrusted to domestic consolidated trust
banking subsidiaries, were ¥1,470,677 million ($13,839,066 thousand) and ¥1,413,077 million as of March 31, 2018 and2017, respectively.

173

Acceptances and Guarantees

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

27. Deferred Tax Assets and Liabilities(1) Deferred Tax Assets and Liabilities consisted of the following:

As of March 31,

Deferred Tax Assets:
Tax Losses Carried Forward
Devaluation of Securities
Reserves for Possible Losses on
Loans
Securities Contributed to
Employee Retirement Benefit
Trust
Other
Deferred Tax Assets Subtotal:
Valuation Allowance
Total
Deferred Tax Liabilities:
Net Unrealized Gains on Other
Securities
Net Defined Benefit Asset
Other
Total
Net Deferred Tax Assets

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥200,319
118,545¥452,166
135,401$1,885,008
1,115,516

103,664

158,222

975,486

191,136
255,594
869,262(299,189)¥570,073

191,895
205,790
1,143,476(580,700)¥562,776

1,798,598
2,405,146
8,179,754(2,815,368)$5,364,386¥(516,747)¥(468,793)$(4,862,589)(305,717)(120,770)¥(943,236)¥(373,162)(243,814)(131,902)¥(844,510)¥(281,734)(2,876,803)(1,136,452)$(8,875,844)$(3,511,458)

Note: MHFG and domestic subsidiaries are subject to a number of different income taxes.
(2) For the fiscal years ended March 31, 2018 and 2017, the reconciliation of the statutory tax rate of MHFG to the effective
income tax rate was as follows:
For the Fiscal Year ended March 31,

Statutory Tax Rate
Adjustments
Change in Valuation Allowance
Permanent Differences (e.g., Cash Dividends
Received)
Tax Rate Differences between theConsolidated Subsidiaries
Impact of corporate restructuring in overseas
group companies
Other
Effective Income Tax Rate

2018

2017

30.86%

30.86%(4.91)

7.66(1.18)(0.96)(1.95)(2.59)―
1.13
23.95%(17.00)(0.41)
17.56%(3) The revision of the amount of deferred tax assets and deferred tax liabilities due to the change in tax rate of thecorporate tax, etc:
The Tax Reform Act was enacted on December 22, 2017 in the U.S.A. and the federal corporate tax rate applied to
MHFG’s consolidated subsidiaries in the U.S.A. has been lowered from 35% to 21% from January 1, 2018.
As a result of this change in the tax rate, Deferred Tax Assets decreased by ¥7,715 million ($72,600 thousand),Deferred Tax Liabilities decreased by ¥1,008 million ($9,492 thousand), and Deferred Income Taxes increased by¥6,706 million ($63,108 thousand).

174

Deferred Tax Assets and Liabilities2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

28. Revaluation of Land
In accordance with the Land Revaluation Law (Proclamation No.34 dated March 31, 1998), land used for business
operations of domestic consolidated banking subsidiaries was revalued. The applicable income taxes on the entire excess
of revaluation are included in Deferred Tax Liabilities for Revaluation Reserve for Land under Liabilities, and the remainder,
net of applicable income taxes, is stated as Revaluation Reserve for Land included in Net Assets.
Revaluation date: March 31, 1998
Revaluation method as stated in Article 3, Paragraph 3 of the above law: Land used for business operations wasrevalued by calculating the value on the basis of the valuation by road rating stipulated in Article 2, Paragraph 4 of
the Enforcement Ordinance relating to the Land Revaluation Law (Government Ordinance No.119 promulgated on
March 31, 1998) with reasonable adjustments to compensate for sites with long depth and other factors, and also on
the basis of the appraisal valuation stipulated in Paragraph 5.
The difference at the consolidated balance sheet date between the total fair value of land for business operation
purposes, which has been revalued in accordance with Article 10 of the above-mentioned law, and the total bookvalue of the land after such revaluation was ¥100,007 million ($941,070 thousand) and ¥117,950 million as ofMarch 31, 2018 and 2017, respectively.

29. Common Stock and Preferred Stock
Common Stock and Preferred Stock at March 31, 2018 and 2017 were as follows:
Number of shares
As of March 31, 2018
Class of stock

Common Stock

Authorized*2

Issued andoutstanding*1

Interimcash
dividend

48,000,000,000

25,389,644,945¥3.75

Per share (Yen)
Year-end
cash Liquidation
dividend
value

¥3.75

¥―

With
Convertible Redemption
or notor notNo

Notes: 1. Treasury Stock is included. The number is as follows:
Common Stock
6,487 thousand shares
2. Each total number of other shares which are authorized to be issued is as follows:First Series Class XIV Preferred Stock
900,000 thousand shares
Second Series Class XIV Preferred Stock
900,000 thousand shares
Third Series Class XIV Preferred Stock
900,000 thousand shares
Fourth Series Class XIV Preferred Stock
900,000 thousand sharesFirst Series Class XV Preferred Stock
900,000 thousand shares
Second Series Class XV Preferred Stock
900,000 thousand shares
Third Series Class XV Preferred Stock
900,000 thousand shares
Fourth Series Class XV Preferred Stock
900,000 thousand sharesFirst Series Class XVI Preferred Stock
1,500,000 thousand shares
Second Series Class XVI Preferred Stock
1,500,000 thousand shares
Third Series Class XVI Preferred Stock
1,500,000 thousand shares
Fourth Series Class XVI Preferred Stock
1,500,000 thousand shares
The total number of shares of the First to Fourth Series Class XIV Preferred Stock, which are authorized to beissued, shall not exceed 900,000,000 in total.
The total number of shares of the First to Fourth Series Class XV Preferred Stock, which are authorized to beissued, shall not exceed 900,000,000 in total.
The total number of shares of the First to Fourth Series Class XVI Preferred Stock, which are authorized to beissued, shall not exceed 1,500,000,000 in total.

175

Revaluation of Land、Common Stock and Preferred StockNo2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Number of shares
As of March 31, 2017Class of stock

Common Stock

Authorized*2

Issued andoutstanding*1

Interimcash
dividend

48,000,000,000

25,386,307,945¥3.75

Per share (Yen)
Year-end
cash Liquidation
dividend
value

¥3.75

¥―

With
Convertible Redemption
or notor notNo

No

Notes: 1. Treasury Stock is included. The number is as follows:
Common Stock
6,705 thousand shares
2. All of the shares of the Eleventh Series Class XI Preferred Stock that had not been requested for acquisition by
June 30, 2016 were acquired as of July 1, 2016 and all of the shares of the Eleventh Series Class XI werecancelled on July 13, 2016.
Accordingly, the common stock shareholders approved an amendment to the Article of Incorporationaccompanied by a decrease in the total number of authorized shares and the total number of authorized shares of
the Class XI preferred stock at the Ordinary General Meeting of Shareholders of MHFG held on June 23, 2017.
As a result of the amendment, each total number of other authorized shares, effective on the same day,shall be
as follows:First Series Class XIV Preferred Stock
900,000 thousand shares
Second Series Class XIV Preferred Stock
900,000 thousand shares
Third Series Class XIV Preferred Stock
900,000 thousand shares
Fourth Series Class XIV Preferred Stock
900,000 thousand sharesFirst Series Class XV Preferred Stock
900,000 thousand shares
Second Series Class XV Preferred Stock
900,000 thousand shares
Third Series Class XV Preferred Stock
900,000 thousand shares
Fourth Series Class XV Preferred Stock
900,000 thousand sharesFirst Series Class XVI Preferred Stock
1,500,000 thousand shares
Second Series Class XVI Preferred Stock
1,500,000 thousand shares
Third Series Class XVI Preferred Stock
1,500,000 thousand shares
Fourth Series Class XVI Preferred Stock
1,500,000 thousand shares
The total number of shares of the First to Fourth Series Class XIV Preferred Stock, which are authorized to beissued, shall not exceed 900,000,000 in total.
The total number of shares of the First to Fourth Series Class XV Preferred Stock, which are authorized to beissued, shall not exceed 900,000,000 in total.
The total number of shares of the First to Fourth Series Class XVI Preferred Stock, which are authorized to beissued, shall not exceed 1,500,000,000 in total.

176

Common Stock and Preferred Stock2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

30. Stock Options
Outline of stock options and changes
For the fiscal year ended March 31, 2018
(1) Outline of stock options

As of March 31, 2018

Number of grantees

Number of stock
options*1
Grant dateCondition for vesting

Required service
periodExercise period

177

Stock OptionsFirst Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

4
4
14

71

5,409,000

Second Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

4
4
14

71

5,835,000

Third Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

4
4
12

71

6,808,000

February 16, 2009
September 25, 2009
August 26, 2010
The grantee may exercise the Stock Acquisition Rights which have been allotted based on his
or her capacity as a Director or an Executive Officer of MHFG, MHBK or MHCB immediately
following the date on which such grantee loses the status as a Director or an Executive Officer
of MHFG, MHBK or MHCB.
April 1, 2010
July 1, 2008
April 1, 2009
to March 31, 2011
to March 31, 2009
to March 31, 2010
August 27, 2010
February 17, 2009
September 28, 2009
to August 26, 2030
to February 16, 2029
to September 25, 2029

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

As of March 31, 2018

Number of grantees

Number of stock
options*1
Grant dateCondition for vesting

Required service
periodExercise period

As of March 31, 2018

Number of grantees

Number of stock
options*1
Grant dateCondition for vesting

Required service
periodExercise period

Fourth Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

6
6
26

130
12,452,000

Fifth Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG

6
11
23

150

Common stock

11,776,000

December 8, 2011
August 31, 2012
The grantee may exercise the Stock Acquisition Rights whichhave been allotted based on his or her capacity as a Director
or an Executive Officer of MHFG, MHBK, MHCB, MHTB or
MHSC immediately following the date on which such grantee
loses the status as a Director or an Executive Officer of
MHFG, MHBK, MHCB, MHTB or MHSC.

April 1, 2011
to March 31, 2012
December 9, 2011
to December 8, 2031

April 1, 2012
to March 31, 2013
September 3, 2012
to August 31, 2032

Sixth Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

6
36
22

134
7,932,000

February 17, 2014
The grantee may exercise theStock Acquisition Rights whichhave been allotted based on
his or her capacity as a
Director or an Executive
Officer of MHFG, MHBK,MHTB or MHSC immediately
following the date on whichsuch grantee loses the status
as a Director or an Executive
Officer of MHFG, MHBK,MHTB or MHSC.
April 1, 2013
to March 31, 2014
February 18, 2014
to February 17, 2034

Seventh Series of Stock
Acquisition Rights of MHFG

Directors
Executive Officers as definedin the Companies Act
Executive Officers as definedin our internal regulations
Directors of subsidiaries of
MHFG
Executive Officers ofsubsidiaries of MHFG
Common stock

2
12
37
32
113
9,602,000

December 1, 2014
The grantee may exercise the Stock Acquisition
Rights which have been allotted based on his or
her capacity as a Director, an Executive Officer as
defined in Companies Act or an Executive Officer
as defined in our internal regulations of MHFG,MHBK, MHTB or MHSC immediately following thedate on which such grantee loses the status as a
Director, an Executive Officer as defined inCompanies Act or an Executive Officer as definedin our internal regulations of MHFG, MHBK, MHTB
or MHSC.
April 1, 2014 to March 31, 2015
December 2, 2014 to December 1, 2034

*1: Shown in number of shares

178

Stock Options

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(2) Size of stock options and changes(i) Number of stock options (in shares)
For the Fiscal Year ended
March 31, 2018

Non-vested
As of March 31, 2017
GrantedForfeited
VestedOutstanding
VestedAs of March 31, 2017
VestedExercised
Forfeited
Outstanding

For the Fiscal Year ended
March 31, 2018

Non-vested
As of March 31, 2017
GrantedForfeited
VestedOutstanding
VestedAs of March 31, 2017
VestedExercised
Forfeited
Outstanding

First Series ofStock Acquisition
Rights of MHFG

Second Series ofStock Acquisition
Rights of MHFG

Third Series ofStock Acquisition
Rights of MHFG

Fourth Series ofStock Acquisition
Rights of MHFG

Fifth Series ofStock Acquisition
Rights of MHFG

124,000───
124,000

220,000───
220,000

331,000───
331,000

966,000──
354,000
612,000

2,207,000
──
733,000
1,474,000

─
─
─
─
─

─
─
─
─
─

─
─
─
─
─

─
354,000
354,000───
733,000
733,000──

Sixth Series ofStock Acquisition
Rights of MHFG

Seventh Series ofStock Acquisition
Rights of MHFG

2,049,000
──
744,000
1,305,000

4,922,000
──
1,772,000
3,150,000

─
744,000
744,000───
1,772,000
1,772,000
──

Note: The above table is shown in number of shares.
(ii) Price information

As of March 31, 2018

Exercise price
Average stock priceupon exercise
Fair value at grant date

As of March 31, 2018

Exercise price
Average stock priceupon exercise
Fair value at grant date179

Stock OptionsFirst Series ofStock Acquisition
Rights of MHFG

Second Series ofStock Acquisition
Rights of MHFG

Third Series ofStock Acquisition
Rights of MHFG

Fourth Series ofStock Acquisition
Rights of MHFG

Fifth Series ofStock Acquisition
Rights of MHFG

¥1 per share¥1 per share¥1 per share¥1 per share¥1 per share

─

─

─

¥205.20¥205.16¥190.91
per share¥168.69
per share¥119.52
per share¥91.84per share¥113.25
per share

Sixth Series ofStock Acquisition
Rights of MHFG

Seventh Series ofStock Acquisition
Rights of MHFG

¥1 per share¥1 per share¥205.16¥205.06¥192.61
per share¥186.99
per share2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(3) Estimated number of stock options to be vested
Only the number of stock options actually forfeited is reflected because the number of stock options that will be forfeitedin the future cannot be readily estimated.
For the fiscal year ended March 31, 2017
(1) Outline of stock options
As of March 31, 2017

Number of grantees

Number of stock
options*1
Grant dateCondition for vesting

Required service
periodExercise period

First Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

Second Series of Stock
Acquisition Rights of MHFG

4 Directors
Executive
4
Officers
Directors of
14 subsidiaries of
MHFG
Executive
Officers of71
subsidiaries of
MHFG
5,409,000

Common stock

Third Series of Stock
Acquisition Rights of MHFG

4 Directors
Executive
4
Officers
Directors of
14 subsidiaries of
MHFG
Executive
Officers of71
subsidiaries of
MHFG
5,835,000

Common stock

4
4
12

71

6,808,000

February 16, 2009
September 25, 2009
August 26, 2010
The grantee may exercise the Stock Acquisition Rights which have been allotted based on his
or her capacity as a Director or an Executive Officer of MHFG, MHBK or MHCB immediately
following the date on which such grantee loses the status as a Director or an Executive Officer
of MHFG, MHBK or MHCB.
July 1, 2008
April 1, 2009
April 1, 2010
to March 31, 2009
to March 31, 2010
to March 31, 2011
August 27, 2010
February 17, 2009
September 28, 2009
to August 26, 2030
to February 16, 2029
to September 25, 2029

180

Stock Options

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

As of March 31, 2017

Number of grantees

Number of stock
options*1
Grant dateCondition for vesting

Required service
periodExercise period

As of March 31, 2017

Number of grantees

Number of stock
options*1
Grant dateCondition for vesting

Required service
periodExercise period*1: Shown in number of shares

181

Stock Options

Fourth Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

6
6
26

130
12,452,000

Fifth Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG

6
11
23

150

Common stock

11,776,000

December 8, 2011
August 31, 2012
The grantee may exercise the Stock Acquisition Rights whichhave been allotted based on his or her capacity as a Director
or an Executive Officer of MHFG, MHBK, MHCB, MHTB or
MHSC immediately following the date on which such grantee
loses the status as a Director or an Executive Officer of
MHFG, MHBK, MHCB, MHTB or MHSC.

April 1, 2011
to March 31, 2012
December 9, 2011
to December 8, 2031

April 1, 2012
to March 31, 2013
September 3, 2012
to August 31, 2032

Seventh Series of Stock
Acquisition Rights of MHFG

Directors
Executive Officers as definedin the Companies Act
Executive Officers as definedin our internal regulations
Directors of subsidiaries of
MHFG
Executive Officers ofsubsidiaries of MHFG
Common stock

2
12
37
32
113
9,602,000

December 1, 2014
The grantee may exercise the Stock Acquisition
Rights which have been allotted based on his or
her capacity as a Director, an Executive Officer as
defined in Companies Act or an Executive Officer
as defined in our internal regulations of MHFG,MHBK, MHTB or MHSC immediately following thedate on which such grantee loses the status as a
Director, an Executive Officer as defined inCompanies Act or an Executive Officer as definedin our internal regulations of MHFG, MHBK, MHTB
or MHSC.
April 1, 2014 to March 31, 2015
December 2, 2014 to December 1, 2034

Sixth Series of Stock
Acquisition Rights of MHFG

Directors
Executive
Officers
Directors ofsubsidiaries of
MHFG
Executive
Officers ofsubsidiaries of
MHFG
Common stock

6
36
22

134
7,932,000

February 17, 2014
The grantee may exercise theStock Acquisition Rights whichhave been allotted based on
his or her capacity as a
Director or an Executive
Officer of MHFG, MHBK,MHTB or MHSC immediately
following the date on whichsuch grantee loses the status
as a Director or an Executive
Officer of MHFG, MHBK,MHTB or MHSC.
April 1, 2013
to March 31, 2014
February 18, 2014
to February 17, 2034

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(2) Size of stock options and changes(i) Number of stock options (in shares)
For the Fiscal Year ended
March 31, 2017

Non-vested
As of March 31, 2016
GrantedForfeited
VestedOutstanding
VestedAs of March 31, 2016
VestedExercised
Forfeited
Outstanding

For the Fiscal Year ended
March 31, 2017

Non-vested
As of March 31, 2016
GrantedForfeited
VestedOutstanding
VestedAs of March 31, 2016
VestedExercised
Forfeited
Outstanding

First Series ofStock Acquisition
Rights of MHFG

Second Series ofStock Acquisition
Rights of MHFG

Third Series ofStock Acquisition
Rights of MHFG

Fourth Series ofStock Acquisition
Rights of MHFG

Fifth Series ofStock Acquisition
Rights of MHFG

124,000───
124,000

325,000──
105,000
220,000

568,000──
237,000
331,000

1,796,000
──
830,000
966,000

3,486,000
──
1,279,000
2,207,000

─
─
─
─
─

─
105,000
105,000───
237,000
237,000───
830,000
830,000───
1,279,000
1,279,000──

Sixth Series ofStock Acquisition
Rights of MHFG

Seventh Series ofStock Acquisition
Rights of MHFG

3,560,000
──
1,511,000
2,049,000

7,331,000
──
2,409,000
4,922,000

─
1,511,000
1,511,000
───
2,409,000
2,409,000
──

Note: The above table is shown in number of shares.
(ii) Price information

As of March 31, 2017

Exercise price
Average stock priceupon exercise
Fair value at grant date

As of March 31, 2017

Exercise price
Average stock priceupon exercise
Fair value at grant date

First Series ofStock Acquisition
Rights of MHFG

Second Series ofStock Acquisition
Rights of MHFG

Third Series ofStock Acquisition
Rights of MHFG

Fourth Series ofStock Acquisition
Rights of MHFG

Fifth Series ofStock Acquisition
Rights of MHFG

¥1 per share¥1 per share¥1 per share¥1 per share¥1 per share─¥162.80¥162.80¥162.80¥162.67¥190.91
per share¥168.69
per share¥119.52
per share¥91.84per share¥113.25
per share

Sixth Series ofStock Acquisition
Rights of MHFG

Seventh Series ofStock Acquisition
Rights of MHFG

¥1 per share¥1 per share¥162.42¥162.39¥192.61
per share¥186.99
per share

182

Stock Options

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(3) Estimated number of stock options to be vested
Only the number of stock options actually forfeited is reflected because the number of stock options that will be forfeitedin the future cannot be readily estimated.

31. Interest Income and Interest Expenses
For the Fiscal Years ended March 31,

Interest Income:Loans and Bills Discounted
Securities
Call Loans and Bills Purchased
Due from Banks
Receivables under Resale
Agreements
Guarantee Deposits Paid under
Securities Borrowing
Transactions
Other Interest Income
Total
Interest Expenses:
Deposits
Call Money and Bills Sold
Payables under Repurchase
Agreements
Guarantee Deposits Received
under Securities Lending
Transactions
Commercial Paper
Borrowed Money
Other Interest Expenses
Total
Net

183

Stock Options、Interest Income and Interest Expenses

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥999,385
282,801
5,569
119,839¥934,108279,8885,234
77,294$9,404,210
2,661,157
52,413
1,127,691

127,923

79,5991,203,755

17,172
69,662¥1,622,354

13,80655,624¥1,445,555

161,594
655,525$15,266,345¥373,551
4,995¥269,618
3,234$3,515,113
47,010230,554

120,362

2,169,517

5,500
8,284
28,285
163,817¥814,988¥807,366

2,793
7,386
17,832
156,509¥577,737¥867,818

51,756
77,957
266,162
1,541,518$7,669,033$7,597,3122018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

32. Trading Income and Trading Expenses
For the Fiscal Years ended March 31,

Trading Income:Net Gains on Trading Securities
Net Gains on Derivatives for
Trading Transactions
Total
Trading Expenses:
Net Losses on Trading Securities
Total
Net

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥180,502¥209,990$1,698,532

96,113¥276,616

116,240¥326,230

904,426$2,602,958

829
¥829
¥275,786

898¥898¥325,332

7,804$7,804$2,595,154

2017

Thousands of U.S. dollars
2018¥84,187
70,832¥70,213150,722$792,201
666,536

12,635
136,558¥304,2143,737
113,603¥338,276

118,903
1,285,018$2,862,658

2017

Thousands of U.S. dollars
2018¥48,016
1,250
43,588¥92,856$835,184
19,252479,531$1,333,967

2017

Thousands of U.S. dollars
2018¥316,471¥295,851$2,977,991

159,062—

1,496,777

26,032—244,964—
12,20356,22633,630—114,837

3,723
48,189¥565,683

2,588
49,746¥438,042

35,041
453,466$5,323,076

33. Other Operating Income
For the Fiscal Years ended March 31,

Gains on Foreign Exchange
Transactions
Gains on Sales of Bonds
Gains on Derivatives other thanfor Trading or Hedging
Other
Total

Millions of yen
2018

34. Other Operating Expenses
For the Fiscal Years ended March 31,

Losses on Sales of Bonds
Losses on Devaluation of Bonds
Other
Total

Millions of yen
2018¥88,755
2,045
50,959¥141,760

35. Other Income
For the Fiscal Years ended March 31,

Gains on Sales of Stock
Reversal of Reserves for
Possible Losses on Loans
Gains on Cancellation of
Employee Retirement
Benefit Trust
Gains on Step Acquisition
Recovery on Written-off Loans
Gains on Disposition of Fixed
AssetsOther
Total

Millions of yen
2018

184

Trading Income and Trading Expenses、Other Operating Income、Other Operating Expenses、Other Income

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

36. Other Expenses
For the Fiscal Years ended March 31,

System migration-related expenses
Losses on Sales of Stocks
Losses on Impairment of Fixed
Assets
Losses on Disposition of Fixed
AssetsProvision for Reserves for Possible
Losses on Loans
Other
Total

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥55,398
28,092¥44,172
34,718$521,296
264,347

6,960

6,651

65,498

5,219

5,197

49,117—96,442¥192,113

61,557127,071¥279,368—
907,526$1,807,784

37. Comprehensive Income
Reclassification adjustments and the related tax effects concerning Other Comprehensive Income
Millions of yen
For the Fiscal Years ended March 31,

Net Unrealized Gains on Other Securities:
The amount arising during the period
Reclassification adjustments
Before adjustments to tax effects
The amount of tax effects
Net Unrealized Gains on Other Securities
Deferred Gains or Losses on Hedges:
The amount arising during the period
Reclassification adjustments
Before adjustments to tax effects
The amount of tax effects
Deferred Gains or Losses on Hedges
Revaluation Reserve for Land:
The amount arising during the period
Reclassification adjustments
Before adjustments to tax effects
The amount of tax effects
Revaluation Reserve for Land
Foreign Currency Translation Adjustments:
The amount arising during the period
Reclassification Adjustments
Before adjustments to tax effects
The amount of tax effects
Foreign Currency Translation Adjustments
Remeasurements of Defined Benefit Plans:
The amount arising during the period
Reclassification Adjustments
Before adjustments to tax effects
The amount of tax effects
Remeasurements of Defined Benefit Plans
Share of Other Comprehensive Income of Associates
Accounted for Using Equity Method:
The amount arising during the period
The total amount of Other Comprehensive Income

185

Other Expenses、Comprehensive Income

2018

Thousands of U.S. dollars
2017

2018

¥408,416(258,697)
149,718(47,385)
102,332¥313,180(361,830)(48,649)
37,684(10,965)$3,843,195(2,434,346)
1,408,849(445,899)
962,950(98,763)(12,064)(110,828)
33,622(77,205)(215,077)(8,233)(223,310)
68,152(155,158)(929,367)(113,528)(1,042,895)
316,389(726,506)

—
—
—
(133)
(133)

—
—
—
(11)
(11)

—
—
—
(1,259)(1,259)(10,949)—(10,949)—(10,949)(12,591)
77(12,514)—(12,514)(103,030)—(103,030)—(103,030)

216,314(141)
216,172(66,699)
149,473

96,08038,699134,780(41,191)
93,5882,035,517(1,333)2,034,184(627,639)
1,406,545(6,284)¥157,233(3,266)¥(88,326)(59,136)$1,479,564

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38. Changes in Net Assets
For the fiscal year ended March 31, 2018(i) Types and number of issued shares and of treasury stock are as follows:

Issued shares
Common stock
Total
Treasury stock
Common stock
Total

Thousands of Shares
As ofMarch 31, 2018
Remarks

As ofApril 1, 2017

Increase during
the fiscal year

Decrease during
the fiscal year

25,386,307
25,386,307

3,337
3,337

—
—

25,389,644
25,389,644*1

19,992
19,992

12,01812,018

7,181
7,181

24,82924,829*2*1 Increases are due to exercise of stock acquisition rights (stock options) (3,337 thousand shares).
*2 Increases are due to acquisition of treasury stock by BBT trust account (8,130 thousand shares) and repurchase of shares constituting less than one unit andother factors (3,888 thousand shares). Decreases are due to distribution of treasury stock through BBT trust account (3,810 thousand shares), exercise ofstock acquisition rights (stock options) (266 thousand shares), and repurchase of shares constituting less than one unit and other factors (3,104 thousand
shares). The number of shares as of March 31, 2018 includes the number of treasury stock held by BBT trust account (13,319 thousand shares).

(ii) Stock acquisition rights and treasury stock acquisition rights are as follows:

Category

Breakdown ofstockacquisitionrightsStockacquisitionrights(Treasurystock
acquisitionrights)Stockacquisitionrights as
stock option
Consolidated
subsidiaries (Treasury
stock acquisition rights)

Class ofshares to
be issuedortransferred
upon
exercise ofstock
acquisitionrightsNumber of shares to be issued or transferred
upon exercise of stock acquisition rights(Shares)
Balance asof March
31, 2018(Thousandsof
U.S.dollars)

As ofApril 1,
2017

Increaseduringthe fiscal
year

Decreaseduringthe fiscal
year

As of
March
31, 2018

Balance as ofMarch 31,2018
(Millions of
yen)

—
(—)

—
(—)

—
(—)

—
(—)

¥—
(—)

$—
(—)

—

1,163

10,952

—

—
(—)

—
(—)

—

¥1,163(—)$10,952(—)

Remarks

MHFG

Total

—

186

Changes in Net Assets

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(iii) Cash dividends distributed by MHFG are as follows (non-consolidated basis):
Cash dividends paid during the fiscal year ended March 31, 2018

Resolution

May 15,2017(

The Board of
Directors

Type)

November 13,
2017(

The Board of
Directors

)

Cash
Cash
Dividends
Dividends(Millions of (Thousands ofyen)
U.S. dollars)

Cash
Cash
Dividends
Dividends
per Shareper Share(Yen) (U.S. dollars)Common Stock¥95,173$895,582

¥3.75

$0.04

Common Stock¥95,186$895,707

¥3.75

$0.04

¥190,360$1,791,289

/

/

Total

RecordDate

Effective
Date

March 31,2017

June 5,2017

September 30, December 5,
2017
2017

(Notes) 1. Cash dividends based on the resolution of the Board of Directors held on May 15, 2017 include 33 million of cash
dividends on treasury stock held by BBT trust account.
2. Cash dividends based on the resolution of the Board of Directors held on November 13, 2017 include 49 millionofcash dividends on treasury stock held by BBT trust account.
Cash dividends with record dates falling in the fiscal year ended March 31, 2018 and effective dates coming after the end of
the fiscal year

Resolution

May 15,2018(

The Board of
Directors

Total

Type

)

Common Stock

Cash
Cash
Dividends
Dividends(Millions of (Thousands ofyen)
U.S. dollars)¥95,186$895,708¥95,186$895,708

Cash
Cash
Resource Dividends
Dividends
of per Shareper Share
Dividends(Yen) (U.S. dollars)

Retained
Earnings

¥3.75

$0.04

/

/

Record Effective
Date
Date

March 31, June 4,
2018
2018

(Note) Cash dividends based on the resolution of the Board of Directors held on May 15, 2018 include 49 million of cash
dividends on treasury stock held by BBT trust account.

187

Changes in Net Assets

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For the fiscal year ended March 31, 2017(i) Types and number of issued shares and of treasury stock are as follows:

Issued shares
Common stock
Eleventh Series Class XI Preferred
Stock
Total
Treasury stock
Common stock
Eleventh Series Class XI Preferred
Stock
Total

Thousands of Shares
As ofMarch 31, 2017
Remarks

As ofApril 1, 2016

Increase during
the fiscal year

Decrease during
the fiscal year

25,030,525

355,782―

25,386,307

914,752
25,945,277―
355,782

914,752
914,752―
25,386,307

10,92912,1883,125

19,992*3

815,828
826,757

98,923111,112914,752
917,877―
19,992*4*1*2*1 Increases are due to request for acquisition (conversion) of preferred stock (349,677 thousand shares) and exercise of stock acquisition rights (stock options)(6,105 thousand shares).
*2 Decreases are due to cancellation of treasury stock (preferred stock).

*3 Increases are due to acquisition of treasury stock by BBT trust account (9,000 thousand shares) and repurchase of shares constituting less than one unit andother factors (3,188 thousand shares). Decreases are due to exercise of stock acquisition rights (stock options) (266 thousand shares) and repurchase ofshares constituting less than one unit and other factors (2,859 thousand shares). The number of shares as of March 31, 2017 includes the number oftreasury stock held by BBT trust account (9,000 thousand shares).
*4 Increases are due to acquisition of treasury stock (preferred stock) (75,091 thousand shares) and request for acquisition (conversion) of preferred stock(23,832 thousand shares). Decreases are due to cancellation of treasury stock (preferred stock).

(ii) Stock acquisition rights and treasury stock acquisition rights are as follows:

Category

Breakdown ofstockacquisitionrightsStockacquisitionrights(Treasurystock
acquisitionrights)Stockacquisitionrights as
stock option
Consolidated
subsidiaries (Treasury
stock acquisition rights)

Class ofshares to
be issuedortransferred
upon
exercise ofstock
acquisitionrightsNumber of shares to be issued or transferred
upon exercise of stock acquisition rights(Shares)

As ofApril 1,
2016

Increaseduringthe fiscal
year

Decreaseduringthe fiscal
year

As of
March
31, 2017

Balance as ofMarch 31,2017
(Millions of
yen)

—
(—)

—
(—)

—
(—)

—
(—)

¥—
(—)

Remarks

MHFG

Total

—

—

1,754

—

—
(—)

—

¥1,754(—)

188

Changes in Net Assets

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(iii) Cash dividends distributed by MHFG are as follows (non-consolidated basis):
Cash dividends paid during the fiscal year ended March 31, 2017

Resolution

Type

May 13,
2016

Common Stock(

The Board of
Directors)

November 14,
2016(

The Board of
Directors)

Cash
Dividends(Millions of
yen)

Cash
Dividends
per Share(Yen)¥93,838¥3.75

March 31,
2016

989

10

March 31,2016

¥95,173¥3.75¥190,001/

Eleventh Series Class XI
Preferred Stock

Common Stock

Total

RecordDate

Effective
Date

June 3,2016

September 30, December 6,
2016
2016

(Note) Cash dividends based on the resolution of the Board of Directors held on November 14, 2016 include 33 million of
cash dividends on treasury stock held by BBT trust account.

Cash dividends with record dates falling in the fiscal year ended March 31, 2017 and effective dates coming after the end of
the fiscal year

Resolution

May 152017(

The Board of
Directors

Total

Type

)

Common Stock

Cash
Dividends(Millions ofyen)¥95,173¥95,173

Cash
Resource Dividendsof per ShareDividends(Yen)

Retained
Earnings¥3.75

Record Effective
Date
Date

March 31, June 5,
2017
2017

/

(Note) Cash dividends based on the resolution of the Board of Directors held on May 15, 2017 include 33 million of cash
dividends on treasury stock held by BBT trust account.

189

Changes in Net Assets

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39. Cash Flows
Cash and Cash Equivalents on the consolidated statement of cash flows reconciles to Cash and Due from Banks on the
consolidated balance sheet as follows:

As of March 31,

Cash and Due from Banks
Less: Due from Banks excluding
due from Central Banks
Cash and Cash Equivalents

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥47,725,360¥47,129,583$449,095,331(1,391,026)¥46,334,334(1,605,919)¥45,523,663(13,089,552)$436,005,779

40. Lease Transactions
Finance Leases (Lessees)
Finance lease transactions that do not transfer ownership:(1) Lease Assets:• Tangible fixed assets: mainly equipment• Intangible fixed assets: software(2) The method for computing the amount of depreciation is described in “5 Standards of Accounting Method (8) Lease
Assets.”Operating Leases
The future lease payments subsequent to the end of the fiscal year for non-cancelable operating lease transactions are
summarized as follows:
Lessees:

As of March 31,

Due in One Year or Less
Due after One Year
Total

Millions of yen
2018

2017

Thousands of U.S. dollars
2018¥51,996
193,996¥52,279
211,127$489,286
1,825,505¥245,992¥263,407$2,314,791

2017

Thousands of U.S. dollars
2018

Lessors:

As of March 31,

Millions of yen
2018

Due in One Year or Less
Due after One Year

¥632
7,267

¥1,113
9,712$5,954
68,383¥7,899¥10,825$74,337

Total

190

Cash Flows、Lease Transactions

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

41. Financial Instruments

1. Matters Relating to the Conditions of Financial Instruments(1) Policy on Financial Instruments
Mizuho Financial Group (MHFG), which primarily engages in banking business, incurs financial liabilities such as
customer deposits and market deposits on the funding side while holding financial assets such as customer loans,stocks and bonds on the investment side, and also engages in trading business for certain financial products. Someconsolidated subsidiaries conduct securities business and other financial business.
For above funding and investment business, MHFG appropriately manages risks of each financial instrument andcarefully watches term-gaps and other risk factors.

(2) Contents and Risk of Financial Products
The main financial assets of the Mizuho group consist of loans to customers, government bonds and stocks. These
financial assets are subject to various types of risk that may cause the Group to incur losses due to a decline in, or total
loss of, the value of assets, as a result of deterioration in a counterparty’s and/or an issuer’s financial position (“creditrisk”), or due to a decline in the value of assets caused by fluctuations in interest rates, stock prices and foreignexchange rates and so on (“market risk”). The Group may also be exposed to the risk of incurring losses when it
becomes impossible to execute transactions in the market because of market confusion or losses arising fromtransactions at prices that are significantly less favorable than usual (“market liquidity risk “).
The main financing source of the Mizuho group is a stable source of deposits from its customers in addition to direct
funding from the financial market. These financing sources are subject to the risk of losses (“liquidity risk”) arising fromfunding difficulties due to market disruption or a deterioration in our financial position that makes it difficult for us to raise
the necessary funds or that forces us to raise funds at significantly higher interest rates than usual.
In addition, the Mizuho group uses derivative financial products to control the interest rate risk related to the assets
and liabilities of the Group, as part of our asset and liability management (“ALM”). The Group primarily utilizes theportfolio hedge by grouping numerous financial assets and liabilities such as loans and deposits into similar interest risk
units in accordance with risk management policies. Some derivative products like interest rate swaps are used as
hedging methods for cash-flow hedges or fair value hedges. The Group applies hedge accounting to the majority ofthese products, treating them as deferred hedges. The effectiveness of the hedges is assessed periodically byregression analysis and other methods to ensure whether the derivative financial products effectively work in order tooffset the exposure to changes in fair value and variable cash flows from hedged items. It should be noted that theMizuho Group uses derivative financial products for trading purposes and so on as well.

(3) Risk Management for Financial Products(a) Commitment to Risk Management
We recognize the conducting of operations tailored to the risks and managing such risks as a key issue relating tooverall management. In order to implement our business strategy while maintaining our financial stability, we
maintain comprehensive risk management and control measures.
We maintain basic policies for risk management established by our board of directors that are applicable to theentire Mizuho group. These policies clearly define the kinds of risks to be managed, set forth the organizational
structure and provide for the human resources training necessary for appropriate levels of risk management. The
policies also provide for audits to measure the effectiveness and suitability of the risk management structure. In linewith these basic policies, we maintain various measures to strengthen and enhance the sophistication of our risk
management system.
(b) General Concept of Risk Management
We classify our risk exposures according to the various kinds of risk, including credit risk, market risk, liquidity risk
and operational risk, and manage each type of risk according to its characteristics.
In addition to managing each type of risk individually, we have established a risk management structure to identify
and evaluate overall risk and, where necessary, to devise appropriate responses to keep risk within limits that aremanagerially acceptable in both qualitative and quantitative terms.
More specifically, we allocate risk capital to core group companies, including their respective subsidiaries, tocontrol risk within the limits set for each company. We also control risk within managerially acceptable limits by

191

Financial Instruments

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working to ensure that the overall risk we hold on a consolidated basis does not exceed the Group’s financial
strength. To ensure the ongoing financial health of Mizuho Financial Group, we regularly monitor the manner inwhich risk capital is being used in order to obtain a proper grasp of the risk profile within this framework. Reports arealso submitted to the board of directors and other committees of each company.
(c) Credit Risk Management
The board of directors of Mizuho Financial Group determines basic matters pertaining to credit risk management. In
addition, we have established the Risk Management Committee, as one of its business policy committees. This
committee broadly discusses and coordinates basic policy in connection with credit risk management and matters inconnection with overall credit portfolio management and credit risk monitoring for the Mizuho group. Under thecontrol of the Chief Risk Officer of Mizuho Financial Group, the Credit Risk Management Department and the Risk
Management Department jointly monitor, analyze and submit suggestions concerning credit risk and formulate andexecute plans in connection with basic matters pertaining to credit risk management.
We have adopted two different but mutually complementary approaches in credit risk management. The first
approach is “credit management,” in which we manage the process for each individual transaction and individual
obligor from execution until collection, based on our assessment of the credit quality of the customer. Through thisprocess, we curb losses in the case of a credit event. The second is “credit portfolio management,” in which weutilize statistical methods to assess the potential for losses related to credit risk. Through this process, we identify
credit risk and respond appropriately.
We use statistical methods to manage the possibility of losses by measuring the expected average loss for a oneyear risk horizon (“expected loss”) and the maximum loss within a certain confidence interval (“credit VAR”). The
difference between expected loss and credit VAR is measured as the credit risk amount (“unexpected loss”). We
recognize two types of risk arising from allowing unexpected loss to become too large. One type is “credit
concentration risk,” which stems from granting excessive credit to certain individual counterparties or corporategroups. The other type is “chain-reaction default risk,” which arises from granting excessive credit to certain areas,industrial sectors and other groupings. We manage these risks appropriately in line with our specific guidelines foreach.
The board of directors of each of our principal banking subsidiaries and other core group companies determines
key matters pertaining to credit risk by establishing their respective basic policies in line with the basic policies for
credit risk management set forth by Mizuho Financial Group. Their respective business policy committees are
responsible for discussing and coordinating overall management of their individual credit portfolios and transaction
policies towards obligors.
The chief risk officer of each principal banking subsidiary and core group company is responsible for mattersrelating to planning and implementing credit risk management. Departments in charge of credit risk management are
responsible for planning and administering credit risk management and conducting credit risk measuring andmonitoring. Credit Departments determine policies and approves/disapproves individual transactions regarding
review and management of and collection from customers in accordance with the lines of authority set forth by eachprincipal banking subsidiary. In addition, each of our principal banking subsidiaries has also established internal audit
groups that are independent of the business departments in order to ensure appropriate credit risk management.
(d) Market Risk Management
The board of directors of Mizuho Financial Group determines basic matters pertaining to market risk management
policies. In addition, we have established the Risk Management Committee, as one of its business policy
committees. The committee broadly discusses and coordinates matters concerning basic policy and operations inconnection with market risk management and market risk monitoring, and proposes measures to be taken in
emergencies such as sudden market changes.
The Chief Risk Officer of Mizuho Financial Group is responsible for matters relating to market risk management
planning and operations. The Risk Management Department of Mizuho Financial Group is responsible for monitoringmarket risk, reports and analyses, proposals, setting limits and guidelines, and formulating and implementing plans
relating to market risk management. In addition, the department assesses and manages the overall market risk of
the Mizuho group as a whole and keeps track of the market risk situation of our principal banking subsidiaries andother core group companies. The department also submits reports to the President & CEO on a daily basis and to
our board of directors and the executive management committee of Mizuho Financial Group on a regular basis.
To manage market risk, we set limits that correspond to risk capital allocations. The amount of risk capital
allocated to market risk corresponds to VAR and additional costs that may arise in order to close relevant positions.

192

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

For trading and banking activities, we set limits for VAR and for losses. For banking activities, we set position limits
based on interest rate sensitivity as needed.
The board of directors of each of our principal banking subsidiaries and other core group companies determine
key matters pertaining to market risk by establishing their respective basic policies in line with the basic policies formarket risk management set forth by Mizuho Financial Group. Based on a common Mizuho Group risk capital
allocation framework, the above-mentioned companies manage market risk by setting limits according to the risk
capital allocated to market risk by Mizuho Financial Group. They have the same market risk management structure
as the Mizuho Financial Group, such as their business policy committees being responsible for overall discussion
and coordination of the market risk management.
In addition, they have established middle offices specializing in risk management that are independent of theirfront offices, which engage in market transactions, and their back offices, which are responsible for book entries andsettlements. This system enables them to achieve mutual checks and control over market operations.
When VAR is not adequate to control risk, the middle offices manage risk using additional risk indices such as 10
BPV (Basis Point Value), carry out stress tests and set stop loss limits as needed.
(e) Situation of Market Risk
i. Banking Business
The following table shows the VAR figures relating to our banking activities for the fiscal years indicated:
Billions of yen
For the Fiscal Years ended March 31,

As of fiscal year end
Maximum
Minimum
AverageThousands of U.S. dollars

2018

2017

2018

¥268.4
307.2
210.8
267.8

¥292.7
397.5
247.4
331.0

$2,525,927
2,891,486
1,983,756
2,520,486[Definition of Banking Business]
The following transactions are categorized as banking business, with trading business and cross-shareholdings
being categorized separately.
(1) Deposits and loans as well as related funding activities, and hedge against interest rate risk.
(2) Equity (excluding cross-shareholdings), bonds, investment trusts, etc. and hedges against related market
risk.
The core deposit of liquid deposits is to be specified and incorporated into the measurement of market risk.
Banking business VAR used to calculate Market Risk Equivalent is based on the following:• VAR : historical simulation method;• confidence interval: one-tailed 99%;
• holding period of one month ; and• historical observation period of three years.

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ii. Trading Business
The following table shows VAR figures of our trading activities for the fiscal years indicated :Billions of yen

Thousands of U.S. dollars

For the Fiscal Years ended March 31,

2018

2017

2018

As of fiscal year end
Maximum
Minimum
Average

¥3.0
6.2
2.2
3.0

¥2.6
5.8
2.3
3.3

$28,485
58,85020,87928,823[Definition of Trading Business](1) Transactions held for the purpose of short-term resale.
(2) Transactions held for the purpose of making a profit from price fluctuations over a short period as well as
fixing a profit from arbitrage activities.
(3) Deals that have both aspects of (1) and (2) above.
(4) Deals held for broking business or market making business.
Trading business VAR used to calculate Market Risk Equivalent is based on the following:• VAR: historical simulation method;• confidence interval: one-tailed 99%;
• holding period of one trading day; and• historical observation period of three years.
iii. Cross-shareholdings
For cross-shareholdings, we take the same market risk management approach as that for Banking and Tradingbusinesses with the use of VAR and risk indices.
The risk index for the cross-shareholdings (sensitivity of the portfolio to a 1% change in the equity index of
TOPIX) is ¥33.0 billion ($311,205 thousand) and ¥31.7 billion for the fiscal years ended March 31, 2018 and 2017,
respectively.
iv. Risk management using VAR
VAR is a commonly used market risk management technique with statistical assumptions to measure maximum
possible loss in the market, which will be incurred to the holding portfolio in a certain period with some probability.
It should be noted that in general VAR model has the following shortcomings:• VAR estimates could differ by assumptions of holding period, confidence interval level and approaches forthe measurement.
• VAR which is calculated based on historical data does not necessarily indicate an accurate future possible
maximum loss.
• VAR might underestimate the probability of extreme market movements when the market gets inactive as
VAR assumes sales of holding portfolio and hedges in the market during the holding period for the
calculation.
• The use of a 99% confidence level neither takes account of, nor makes any statement about, any losses
that might occur beyond this confidence level.
The historical simulation method used as the measurement technique of VAR assumes that change in a market
movement follows an empirical distribution. Therefore, the model might underestimate the risk under thecircumstance that the market is likely to move extremely beyond the assumption. We check the validity of themarket risk measurement made by VAR approach periodically by the back-test which compares VAR with actual
profit and loss. In addition to VAR, we make a wide variety of management and controls such as risk indicesmonitoring, implementation of stress tests, loss limit monitoring in order to make strict risk management by
capturing carefully all risks, including what VAR approach is not able to cover.
(f) Liquidity Risk Management
Our liquidity risk management structure is generally the same as the market risk management structure describedabove (“Item (d) Market Risk Management”). However, the head of the Financial Control & Accounting Group of
Mizuho Financial Group is additionally responsible for matters relating to planning and running cash flow
management operations, while the Financial Planning Department is responsible for monitoring and adjusting

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

the cash flow management situation and for planning and implementing cash flow management. Reports on the
cash flow situation are submitted to the Risk Management Committee, the Balance Sheet Management Committee,
the executive management committee and the President & CEO.
We measure liquidity risk using indices pertaining to cash flow, such as limits on funds raised in the market. Limits
on liquidity risk are discussed and coordinated by the Risk Management Committee, discussed further by the
executive management committee and determined by the President & CEO. We have established classifications forthe cash flow conditions affecting the Group, ranging from “normal” to “anxious” and “crisis,” and have establishedprocedures for dealing with cases which are deemed to fall into the “anxious” or “crisis” categories. In addition, we
have constructed a system under which we will be able to respond smoothly in the event of emergency situations
that affect our funding by establishing action plans.

(4) Supplementary Explanation of Matters Relating to Fair Value of Financial Instruments and Others
Fair values of financial instruments include the values based on market prices, and the values deemed as market prices
obtained by the reasonable estimate when the financial instruments do not have market prices. Since certain
assumptions and others are adopted for calculating such values, they may differ when adopting different assumptions
and others.

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2. Matters Relating to Fair Value of Financial Instruments and Others
The following are the consolidated balance sheet amounts, fair values and differences between them as of March 31,2018 and 2017. Unlisted stocks and others, the fair values of which are extremely difficult to determine, are excluded
from the table below (see (Note 2)).
Millions of yen
As of March 31, 2018

(1) Cash and Due from Banks *1(2) Call Loans and Bills Purchased *1(3) Receivables under Resale Agreements(4) Guarantee Deposits Paid under Securities Borrowing
Transactions(5) Other Debt Purchased *1(6) Trading Assets
Trading Securities(7) Money Held in Trust *1(8) Securities
Bonds Held to Maturity
Other Securities(9) Loans and Bills Discounted
Reserves for Possible Losses on Loans *1
Total Assets(1) Deposits(2) Negotiable Certificates of Deposit(3) Call Money and Bills Sold
(4) Payables under Repurchase Agreements(5) Guarantee Deposits Received under Securities
Lending Transactions(6) Trading Liabilities
Securities Sold, Not yet Purchased(7) Borrowed Money(8) Bonds and Notes(9) Due to Trust Accounts
Total Liabilities
Derivative Transactions *2
Derivative Transactions not Qualifying for Hedge
Accounting
Derivative Transactions Qualifying for Hedge
Accounting
Reserves for Derivative Transactions *1
Total Derivative Transactions

Consolidated Balance
Sheet Amount

Fair Value

Difference¥47,723,757
714,870
8,080,873¥47,723,757
714,870
8,080,873¥―――

4,350,527
2,713,345

4,350,527
2,713,347―
1

5,188,400
336,203

5,188,400
336,203――2,515,830
31,103,130
79,421,473(275,439)
79,146,034¥181,872,972¥125,081,233
11,382,590
2,105,293
16,656,828

2,521,846
31,103,130

6,016
―

80,053,839¥182,786,795¥125,063,500
11,382,089
2,105,293
16,656,828

907,804¥913,822¥(17,733)
(500)
―
―

1,566,833

1,566,833―

3,185,101
4,896,218
7,544,256
4,733,131¥177,151,488

3,185,101
4,886,962
7,591,266
4,733,131¥177,171,007―(9,256)47,009―¥19,519¥501,212¥―¥267,784
234,783(1,355)¥501,212*1 General and specific reserves for possible losses on loans relevant to Loans and Bills Discounted and reserves for derivative transactions are excluded.

Reserves for Cash and Due from Banks, Call Loans and Bills Purchased, Other Debt Purchased, Money Held in Trust and others are directly written off
against the consolidated balance sheet amount due to immateriality.
*2 Derivative Transactions recorded in Trading Assets, Trading Liabilities, Derivatives other than for Trading Assets, Derivatives other than for Trading
Liabilities, and others are presented as a lump sum.
Net claims and debts that arose from derivative transactions are presented on a net basis, and the item that is net debts in total is presented in brackets.

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Millions of yen
As of March 31, 2017

(1) Cash and Due from Banks *1(2) Call Loans and Bills Purchased *1(3) Receivables under Resale Agreements(4) Guarantee Deposits Paid under Securities Borrowing
Transactions(5) Other Debt Purchased *1(6) Trading Assets
Trading Securities(7) Money Held in Trust *1(8) Securities
Bonds Held to Maturity
Other Securities(9) Loans and Bills Discounted
Reserves for Possible Losses on Loans *1
Total Assets(1) Deposits(2) Negotiable Certificates of Deposit(3) Call Money and Bills Sold
(4) Payables under Repurchase Agreements(5) Guarantee Deposits Received under Securities
Lending Transactions(6) Trading Liabilities
Securities Sold, Not yet Purchased(7) Borrowed Money(8) Bonds and Notes(9) Due to Trust Accounts
Total Liabilities
Derivative Transactions *2
Derivative Transactions not Qualifying for Hedge
Accounting
Derivative Transactions Qualifying for Hedge
Accounting
Reserves for Derivative Transactions *1
Total Derivative Transactions

Consolidated Balance
Sheet Amount

Fair Value

Difference¥47,127,865
1,034,901
8,967,777¥47,127,865
1,034,901
8,967,777¥―――

3,350,051
2,744,844

3,350,051
2,744,847―
3

4,800,408
247,080

4,800,408
247,080――

3,815,674
27,946,221
78,337,793(433,661)
77,904,132¥177,938,958¥120,045,217
10,631,277
1,255,172
17,969,753

3,846,718
27,946,221

31,043―78,916,087¥178,981,961¥120,044,703
10,631,008
1,255,172
17,969,753

1,011,955¥1,043,002¥(514)(268)――

1,679,300

1,679,300―

2,221,541
6,307,230
7,564,535
4,784,077¥172,458,105

2,221,541
6,281,775
7,626,076
4,784,077¥172,493,409―(25,454)
61,541―¥35,303¥177,922¥―¥[119,961]
302,350(4,466)¥177,922*1 General and specific reserves for possible losses on loans relevant to Loans and Bills Discounted and reserves for derivative transactions are excluded.

Reserves for Cash and Due from Banks, Call Loans and Bills Purchased, Other Debt Purchased, Money Held in Trust and others are directly written off
against the consolidated balance sheet amount due to immateriality.

*2 Derivative Transactions recorded in Trading Assets, Trading Liabilities, Derivatives other than for Trading Assets, Derivatives other than for Trading

Liabilities, and others are presented as a lump sum.
Net claims and debts that arose from derivative transactions are presented on a net basis, and the item that is net debts in total is presented in brackets.

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Thousands of U.S. dollars
As of March 31, 2018

(1) Cash and Due from Banks *1(2) Call Loans and Bills Purchased *1(3) Receivables under Resale Agreements(4) Guarantee Deposits Paid under Securities Borrowing
Transactions(5) Other Debt Purchased *1(6) Trading Assets
Trading Securities(7) Money Held in Trust *1(8) Securities
Bonds Held to Maturity
Other Securities(9) Loans and Bills Discounted
Reserves for Possible Losses on Loans *1
Total Assets(1) Deposits(2) Negotiable Certificates of Deposit(3) Call Money and Bills Sold
(4) Payables under Repurchase Agreements(5) Guarantee Deposits Received under Securities
Lending Transactions(6) Trading Liabilities
Securities Sold, Not yet Purchased(7) Borrowed Money(8) Bonds and Notes(9) Due to Trust Accounts
Total Liabilities
Derivative Transactions *2
Derivative Transactions not Qualifying for Hedge
Accounting
Derivative Transactions Qualifying for Hedge
Accounting
Reserves for Derivative Transactions *1
Total Derivative Transactions

Consolidated Balance
Sheet Amount

Fair Value

Difference$449,080,240
6,726,928
76,040,970$449,080,240
6,726,928
76,040,970$―――

40,938,430
25,532,560

40,938,430
25,532,578―
18

48,822,813
3,163,672

48,822,813
3,163,672――

23,673,947
292,680,249
747,355,546(2,591,880)
744,763,666$1,711,423,475$1,177,013,588
107,110,101
19,810,801
156,740,647

23,730,558
292,680,249

56,611―

753,306,103$1,720,022,541$1,176,846,713
107,105,389
19,810,801
156,740,647

8,542,437$8,599,066$(166,875)(4,712)――

14,743,895

14,743,895―

29,971,783
46,073,388
70,991,403
44,538,732$1,666,994,338

29,971,783
45,986,288
71,433,766
44,538,732$1,667,178,014―(87,100)
442,363—$183,676$4,716,407$―$2,519,846
2,209,315(12,754)$4,716,407*1 General and specific reserves for possible losses on loans relevant to Loans and Bills Discounted and reserves for derivative transactions are excluded.

Reserves for Cash and Due from Banks, Call Loans and Bills Purchased, Other Debt Purchased, Money Held in Trust and others are directly written off
against the consolidated balance sheet amount due to immateriality.

*2 Derivative Transactions recorded in Trading Assets, Trading Liabilities, Derivatives other than for Trading Assets, Derivatives other than for Trading

Liabilities, and others are presented as a lump sum.
Net claims and debts that arose from derivative transactions are presented on a net basis, and the item that is net debts in total is presented in brackets.

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(Note 1) Calculation method of fair value of financial instruments
Assets(1) Cash and Due from Banks
For Due from Banks which have no maturity, since fair values of these items approximate book values, we deem thebook values to be fair values. For Due from Banks which have maturity, since contractual terms of these items aremainly short (i.e., within six months) and fair values of these items approximate book values, we deem the book values
to be fair values.
(2) Call Loans and Bills Purchased, (3) Receivables under Resale Agreements and (4) Guarantee Deposits Paid under
Securities Borrowing Transactions
Since contractual terms of these items are mainly short (i.e., within six months) and fair values of these items
approximate book values, we deem the book values to be fair values.
(5) Other Debt Purchased
Fair values of Other Debt Purchased are based on the values deemed as market prices obtained by the reasonableestimate such as those obtained from brokers and financial information vendors.
(6) Trading Assets
Fair values of securities held for trading, such as bonds held for trading, are based on the market prices and others.
(7) Money Held in Trust
As to securities managed as trust assets in a directed money trust for separate investment with the management of
securities as its primary purpose, fair values of these items are calculated using the method stated in (8). For other
Money Held in Trust, since fair values of these items approximate book values, we deem the book values to be fairvalues.
The notes to Money Held in Trust based on holding purpose are stated in “42.Fair Value of Securities and Money
Held in Trust.”(8) Securities
Fair values of stocks are based on the prices on securities exchanges, and those of bonds and others are based on themarket prices, valuations obtained from brokers and information vendors and others. Fair values of investment trusts are
based on the disclosed net asset value and others. Fair values of private placement bonds are calculated by discounting
the total amount of principal and interest and others at interest rates based on the discount rate reflecting expected loss
and various risk factors by categories according to the internal ratings and terms.
Fair values of securitized products are based on valuations obtained from brokers and others, and reasonably
calculated prices based on the reasonable estimates of our management. In deriving reasonably calculated prices
based on the reasonable estimates of our management mentioned above, we used the discounted cash flow method.
The price decision variables include default rates, recovery rates, pre-payment rates, and discount rates.
Fair values of Floating-rate Japanese Government Bonds, according to our determination that current market prices
may not reflect the fair value, are based on the reasonably calculated prices as book value. In deriving the reasonably
calculated prices, we used the discount cash flow method as well as other methods. The price decision variables include
the yield of 10-year Japanese Government Bonds and the volatilities of interest rate swap options for 10-year Japanese
Government Bonds as underlying assets.
The notes to Securities based on holding purpose are stated in “42.Fair Value of Securities and Money Held in Trust.”(9) Loans and Bills Discounted
Fair values of Loans and Bills Discounted are calculated by the total amount of principal and interest and others at
interest rates based on the discount rate reflecting expected loss and various risk factors by categories according to thetypes, internal ratings and terms of the Loans and Bills Discounted. In addition, as to claims against bankrupt obligors,
substantially bankrupt obligors and intensive control obligors, since the estimated amount of bad debts is calculated
based on the present value of the expected future cash flows or the estimated amounts that we would be able to collectfrom collateral and guarantees, fair values approximate the amount of Debentures and others minus the amount of

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Reserves for Possible Losses on Loans in the consolidated balance sheet as of the consolidated balance sheet date
and we thus deem such amount to be fair values.
Of the Loans and Bills Discounted, for those without a fixed maturity due to loan characteristics such as limiting loans
to within the value of pledged assets, we deem book values to be fair values since fair values are expected toapproximate book values based on the estimated loan periods, interest rates and other conditions.
Liabilities(1) Deposits (2) Negotiable Certificates of Deposit
For demand deposits, we deem the payment amounts required on the consolidated balance sheet date (i.e., bookvalues) to be fair values. In addition, fair values of fixed deposits and negotiable certificates of deposits are calculated byclassifying them based on their terms and by discounting the future cash flows. The discount rates used in suchcalculations are the interest rates. Since fair values of those whose deposit terms are short (i.e., within six months)
approximate book values, we mainly deem the book values to be fair values.
(3) Call Money and Bills Sold, (4) Payables under Repurchase Agreements and (5) Guarantee Deposits Received under
Securities Lending Transactions
Since contractual terms of these financial instruments are mainly short (i.e., within six months) and fair values
approximate book values, we deem the book values to be fair values.
(6) Trading Liabilities
Fair values of Securities Sold, Not yet Purchased in Trading Liabilities are based on the market prices and others.
(7) Borrowed Money
Fair values of Borrowed Money are calculated mainly by discounting the total amount of the principal and interest ofsuch Borrowed Money classified by certain period at the interest rates considered to be applicable to similar loans.
(8) Bonds and Notes
Fair values of Bonds and Notes issued by MHFG and its consolidated subsidiaries are based on the market prices for
Bonds and Notes which have market prices, and calculated by discounting the total amount of principal and interest by
the interest rates considered to be applicable to similar Bonds and Notes for those which do not have market prices.
(9) Due to Trust Accounts
Due to Trust Accounts of consolidated trust banking subsidiaries is used for transactions in which consolidated trust
banking subsidiaries manage fund entrusted to them in bank accounts of consolidated trust banking subsidiaries. As the
purpose is considered to approximate demand deposit, we deem the book values to be fair values.
Derivative Transactions
Derivative transactions include interest rate-related transactions (futures, options, swaps and others), currency-relatedtransactions (futures, options, swaps and others), bond-related transactions (futures, futures options and others), andare based on the prices on securities exchanges, discounted value of future cash flows, option pricing models andothers.

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(Note 2) Consolidated balance sheet amounts of financial instruments whose fair values are deemed to be extremely
difficult to determine are indicated below, and are not included in “Assets (5) Other Debt Purchased”, “Assets (7)Money Held in Trust” and “Assets (8) Other Securities” in fair value information of financial instruments.
Millions of yen
2018
2017
Consolidated Balance
Consolidated Balance
Sheet Amount
Sheet Amount

As of March 31,
Category¥204,081
104,569
1,263¥309,913(i) Unlisted Stocks *1(ii) Investments in Partnerships and others *2(iii) Other
Total *3Thousands of U.S. dollars
2018
Consolidated Balance
Sheet Amount¥190,320
86,291
539¥277,151$1,920,404
983,997
11,885$2,916,286*1 We do not treat Unlisted Stocks as being subject to disclosure of fair values as there are no market prices and they are deemed extremely difficult todetermine fair values.

*2 Of the Investments in Partnerships and others, we do not treat those whose assets consist of unlisted stocks and other financial instruments that are

deemed extremely difficult to determine fair values as being subject to disclosure of fair values.

*3 During the fiscal years ended March 31, 2018 and 2017, the amounts of impairment (devaluation) were ¥3,794 million ($35,711 thousand) and ¥4,823

million, respectively, on a consolidated basis.

(Note 3) Projected redemption amounts after the consolidated balance sheet date for financial assets and securities withmaturities

3-5 years

5-7 years

7-10 years

Millions of yen
Over 10 years

Due from Banks¥46,715,934¥200¥0Call Loans and Bills Purchased
715,149——
Other Debt Purchased
2,468,141
64,33840,744
10,525,858
5,374,758
3,753,350
Securities *1
Bonds Held to Maturity
840,000
640,000
100,000
Japanese Government Bonds
840,000
640,000
100,000
Foreign Bonds———
Other Securities with Maturities
9,685,858
4,734,758
3,653,350
Japanese Government Bonds
6,281,356
3,146,400
1,841,800
Japanese Local Government
31,942
25,48092,288
Bonds
Japanese Corporate Bonds
459,476792,243
488,381
Foreign Bonds
2,887,975
760,999
1,147,715
Other
25,106
9,635
83,16433,417,990
16,156,883
11,446,603
Loans and Bills Discounted *2
Total¥93,843,074 ¥21,596,181 ¥15,240,697

¥—
—
4,573
1,824,092
380,000
380,000—
1,444,092
355,425¥——
5,273
2,949,807———
2,949,807
1,494,800¥——
129,730
3,069,029
522,783—
522,783
2,546,245
100,000

57,001

24,141

4,444

As of March 31, 2018
Types of Financial Instruments

201

Financial Instruments

Within 1 year

1-3 years

219,019799,771
12,8755,495,875¥7,324,541

201,658
790,625
1,192,863
1,599,648
36,34351,527
4,725,641
7,044,731¥7,680,722 ¥10,243,490

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3-5 years

5-7 years

7-10 years

Millions of yen
Over 10 years

Due from Banks¥46,346,741¥—¥0Call Loans and Bills Purchased
1,035,746——
Other Debt Purchased
2,380,855
182,930
30,802
7,822,181
7,948,593
1,854,038
Securities *1
Bonds Held to Maturity
1,100,000
1,480,000—
Japanese Government Bonds
1,100,000
1,480,000—
Foreign Bonds———
Other Securities with Maturities
6,722,181
6,468,593
1,854,038
Japanese Government Bonds
3,144,670
5,030,500
487,100
Japanese Local Government
41,30544,60656,456
Bonds
Japanese Corporate Bonds
602,805
611,652
350,394
Foreign Bonds
2,901,555
742,863
934,986
Other
31,84538,97025,10031,782,483
16,083,902
12,194,119
Loans and Bills Discounted *2
Total¥89,368,008 ¥24,215,426 ¥14,078,960

¥—
—
6,496
2,333,771
380,000
380,000—
1,953,771
75,230¥——1,199
2,923,163
100,000
100,000—
2,823,163
1,463,100¥——
141,504
3,230,787
708,832—
708,832
2,521,955—

77,05958,478548

As of March 31, 2017
Types of Financial Instruments

As of March 31, 2018
Types of Financial Instruments

Within 1 year

Within 1 year

1-3 years

1-3 years

3-5 years

142,663
1,602,879
55,9385,139,898¥7,480,166

205,271760,476
1,071,954
1,716,058
24,35844,871
4,706,564
7,256,890¥7,630,927 ¥10,629,182

5-7 years

Thousands of U.S. dollars
7-10 years Over 10 years

Due from Banks$439,596,633$1,888$1$—$—$—
Call Loans and Bills Purchased
6,729,550—————
Other Debt Purchased
23,225,200
605,425
383,403
43,03349,6251,220,762
99,048,254
50,576,447
35,319,002 17,164,700 27,757,667 28,879,545
Securities *1
Bonds Held to Maturity
7,904,394
6,022,396
940,999
3,575,797—
4,919,388
Japanese Government Bonds
7,904,394
6,022,396
940,999
3,575,797——
Foreign Bonds
—
—
—
—
—
4,919,388
Other Securities with Maturities
91,143,860
44,554,051
34,378,003 13,588,903 27,757,667 23,960,157
Japanese Government Bonds 59,107,525
29,607,603
17,331,326
3,344,547 14,066,058
940,999
Japanese Local Government
300,578
239,770
868,438
536,385
227,175
41,822
Bonds
Japanese Corporate Bonds
4,323,673
7,455,005
4,595,666
2,060,970
1,897,607
7,439,778
Foreign Bonds
27,175,834
7,160,999
10,799,998
7,525,844 11,224,836 15,052,684
Other
236,250
90,674
782,575
121,157
341,991
484,874
314,463,072 152,036,167 107,712,461 51,716,155 44,468,260 66,290,875
Loans and Bills Discounted *2
Total$883,062,709 $203,219,927 $143,414,867 $68,923,888 $72,275,552 $96,391,182*1 Securities include those of which fair values are extremely difficult to determine.
*2 Amounts do not include loans to bankrupt, substantially bankrupt, and intensive control obligors and other loans, of which redemption amounts cannot be

projected, of ¥353,132 million ($3,322,972 thousand) and ¥461,985 million, and loans with no maturities of ¥780,615 million ($7,345,584 thousand) and¥711,950 million as of March 31, 2018 and 2017, respectively.

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(Note 4) Projected repayment amounts after the consolidated balance sheet date for Bonds and Notes, Borrowed Money,
and other interest-bearing liabilities
As of March 31, 2018
Types of Financial Instruments

Within 1 year

1-3 years

3-5 years

5-7 years

7-10 years

Millions of yen
Over 10 years

Deposits *1
Negotiable Certificates of
DepositCall Money and Bills Sold
Borrowed Money
Short-term Bonds
Bonds and Notes *3
Due to Trust Accounts
Total¥121,278,407¥2,974,182¥691,786¥86,972¥41,370¥8,514

11,021,750
2,105,293
2,221,554
362,185
740,960
4,733,131¥142,463,282

357,705—
1,541,595—
1,145,772—¥6,019,255

4,062—
309,410—
1,883,455—¥2,888,714——
260,283—
626,680—¥973,936——
303,808—
1,375,904—¥1,721,082——
259,565—
532,969—¥801,049

As of March 31, 2017
Types of Financial Instruments

Within 1 year

1-3 years

3-5 years

5-7 years

7-10 years

Millions of yen
Over 10 years¥115,871,830¥3,334,187¥696,662¥73,125¥60,455¥8,955

10,421,618
1,255,172
604,614226,348
1,414,830
4,784,077¥134,578,491

150,627—
3,095,130—
1,486,069—¥8,066,014

60,067—
1,542,031—
1,331,397—¥3,630,158——
338,626—
564,022—¥975,775——
377,791—
1,400,953—¥1,839,199——
305,037—
588,868—¥902,861

Within 1 year

1-3 years

3-5 years

5-7 years

Thousands of U.S. dollars
7-10 years
Over 10 years$1,141,229,017$27,987,039$6,509,705$818,409$389,293$80,125

103,714,598
19,810,801
20,904,810
3,408,162
6,972,430
44,538,732$1,340,578,550

3,366,004—
14,506,407—
10,781,707—$56,641,157

38,224—2,911,554—
17,723,299—$27,182,782——
2,449,268—
5,897,055—$9,164,732——
2,858,835—
12,947,251—$16,195,379——
2,442,514—
5,015,235—$7,537,874

Deposits *1
Negotiable Certificates of
DepositCall Money and Bills Sold
Borrowed Money *2
Short-term Bonds
Bonds and Notes *3
Due to Trust Accounts
Total
As of March 31, 2018
Types of Financial Instruments

Deposits *1
Negotiable Certificates of
DepositCall Money and Bills Sold
Borrowed Money
Short-term Bonds
Bonds and Notes *3
Due to Trust Accounts
Total*1 Demand deposits are included in “Within 1 year.”*2 Amounts do not include Borrowed Money with no maturities of ¥44,000 million as of March 31, 2017.
*3 Amounts do not include Bonds and Notes with no maturities of ¥1,239,000 million ($11,658,982 thousand) and ¥779,000 million as of March 31, 2018 and2017, respectively.

203

Financial Instruments

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

42. Fair Value of Securities and Money Held in Trust
The following tables contain information relating to “Securities,” Trading Securities, Short-term Bonds, certain other items in“Trading Assets,” Negotiable Certificates of Deposit in “Cash and Due from Banks,” certain items in “Other Debt
Purchased,” certain items in “Other Assets,” and “Money Held in Trust.”
Millions of yen

As of March 31, 2018

Bonds Held-to-Maturity (Total)
Bonds Whose Fair Values Exceed the Consolidated
Balance Sheet Amount Bonds Held-to-Maturity:
Japanese Government Bonds
Foreign Bonds
Bonds Whose Fair Values Do Not Exceed the Consolidated
Balance Sheet Amount Bonds Held-to-Maturity:
Japanese Government Bonds
Foreign Bonds

Consolidated
Balance
Sheet Amount

Fair value

Difference¥2,515,830¥2,521,846¥6,016¥1,959,909
1,959,909—¥1,984,382
1,984,382—¥24,472
24,472—¥555,920—
555,920¥537,464—
537,464¥(18,455)—(18,455)
Millions of yen

As of March 31, 2017

Bonds Held-to-Maturity (Total)
Bonds Whose Fair Values Exceed the Consolidated
Balance Sheet Amount Bonds Held-to-Maturity:
Japanese Government Bonds
Foreign Bonds
Bonds Whose Fair Values Do Not Exceed the Consolidated
Balance Sheet Amount Bonds Held-to-Maturity:
Japanese Government Bonds
Foreign Bonds

Consolidated
Balance
Sheet Amount

Fair value

Difference¥3,815,674¥3,846,718¥31,043¥3,083,991
3,059,975
24,015¥3,121,303
3,097,144
24,159¥37,312
37,168144¥731,682—
731,682¥725,414—
725,414¥(6,268)—(6,268)

Thousands of U.S. dollars

As of March 31, 2018

Bonds Held-to-Maturity (Total)
Bonds Whose Fair Values Exceed the Consolidated
Balance Sheet Amount Bonds Held-to-Maturity:
Japanese Government Bonds
Foreign Bonds
Bonds Whose Fair Values Do Not Exceed the Consolidated
Balance Sheet Amount Bonds Held-to-Maturity:
Japanese Government Bonds
Foreign Bonds

Consolidated
Balance
Sheet Amount

Fair value

Difference$23,673,947$23,730,558$56,611$18,442,740
18,442,740—$18,673,022
18,673,022—$230,282
230,282—$5,231,207—
5,231,207$5,057,536—
5,057,536$(173,671)—(173,671)

204

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Millions of yen

As of March 31, 2018

Other Securities*1 (Total)
Other Securities Whose Consolidated Balance Sheet
Amount Exceeds Acquisition Cost
Other Securities:
Japanese Stocks
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Short-term Bonds
Japanese Corporate Bonds
Other:
Foreign Bonds
Other Debt Purchased
Other
Other Securities Whose Consolidated Balance Sheet
Amount Does Not Exceed Acquisition Cost
Other Securities:
Japanese Stocks
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Short-term Bonds
Japanese Corporate Bonds
Other:
Foreign Bonds
Other Debt Purchased
Other
Money Held in Trust
Other Money Held in Trust

205

Fair Value of Securities and Money Held in Trust

Consolidated
Balance
Sheet Amount

Acquisition Cost

Difference¥31,581,138¥29,626,911¥1,954,226*2¥14,261,162
3,402,250
7,512,070
5,786,004
151,508—
1,574,556
3,346,841
2,641,061
74,171
631,608¥12,002,479
1,351,285
7,474,247
5,775,747
148,605—
1,549,894
3,176,946
2,629,413
72,973474,559¥2,258,682
2,050,964
37,822
10,257
2,903—
24,662
169,894
11,647
1,198
157,048¥17,319,975
179,989
9,023,533
7,546,089
87,82499
1,389,519
8,116,452
5,688,079
112,361
2,316,011¥17,624,431
213,582
9,055,945
7,555,729
88,10599
1,412,009
8,354,904
5,865,823
112,641
2,376,439¥(304,455)¥3,199¥3,199¥—(33,592)(32,411)(9,640)(280)—(22,489)(238,451)(177,743)(279)(60,428)

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Millions of yen

As of March 31, 2017

Other Securities*1 (Total)
Other Securities Whose Consolidated Balance Sheet
Amount Exceeds Acquisition Cost
Other Securities:
Japanese Stocks
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Short-term Bonds
Japanese Corporate Bonds
Other:
Foreign Bonds
Other Debt Purchased
Other
Other Securities Whose Consolidated Balance Sheet
Amount Does Not Exceed Acquisition Cost
Other Securities:
Japanese Stocks
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Short-term Bonds
Japanese Corporate Bonds
Other:
Foreign Bonds
Other Debt Purchased
Other
Money Held in Trust
Other Money Held in Trust

Consolidated
Balance
Sheet Amount

Acquisition Cost

Difference¥28,480,731¥26,661,507¥1,819,224*2¥15,314,224
3,363,211
8,408,911
6,499,349
225,771—
1,683,790
3,542,100
2,672,850
84,802784,447¥13,210,435
1,464,923
8,353,050
6,474,096
220,930—
1,658,023
3,392,462
2,659,805
83,047649,608¥2,103,788
1,898,288
55,86125,253
4,840—
25,767
149,638
13,044
1,754
134,838¥13,166,507
178,834
4,836,243
3,764,979
58,70099
1,012,463
8,151,429
6,282,585
152,978
1,715,864¥13,451,071
222,664
4,870,924
3,781,517
58,93299
1,030,373
8,357,482
6,439,935
153,371
1,764,175¥(284,563)(43,830)(34,680)(16,537)(232)—(17,910)(206,053)(157,349)(393)(48,310)¥3,286¥3,286¥—

206

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Thousands of U.S. dollars

As of March 31, 2018

Other Securities*1 (Total)
Other Securities Whose Consolidated Balance Sheet
Amount Exceeds Acquisition Cost
Other Securities:
Japanese Stocks
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Short-term Bonds
Japanese Corporate Bonds
Other:
Foreign Bonds
Other Debt Purchased
Other
Other Securities Whose Consolidated Balance Sheet
Amount Does Not Exceed Acquisition Cost
Other Securities:
Japanese Stocks
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Short-term Bonds
Japanese Corporate Bonds
Other:
Foreign Bonds
Other Debt Purchased
Other
Money Held in Trust
Other Money Held in Trust

Consolidated
Balance
Sheet Amount

Acquisition Cost

Difference$297,178,304$278,789,042$18,389,262*2$134,197,445
32,015,156
70,688,534
54,446,269
1,425,695—
14,816,570
31,493,755
24,852,370
697,953
5,943,432$112,943,257
12,715,590
70,332,621
54,349,746
1,398,375—
14,584,500
29,895,046
24,742,764
686,678
4,465,604$21,254,188
19,299,566
355,913
96,52327,320—232,070
1,598,709
109,606
11,275
1,477,828$162,980,859
1,693,699
84,911,394
71,008,650
826,432941
13,075,371
76,375,766
53,524,795
1,057,322
21,793,649$165,845,785
2,009,805
85,216,383
71,099,369
829,071941
13,287,002
78,619,597
55,197,359
1,059,956
22,362,282$(2,864,926)(316,106)(304,989)(90,719)(2,639)—(211,631)(2,243,831)(1,672,564)(2,634)(568,633)$30,103$30,103$—*1 The fair value of Japanese stocks is determined based on the average quoted market price over the month preceding the consolidated balance sheet date.

The fair value of securities other than Japanese stocks is determined at the quoted market price if available, or other reasonable value at the consolidatedbalance sheet date.
*2 Unrealized Gains (Losses) or Difference include gains of ¥28,273 million ($266,058 thousand) and ¥34,372 million which were recognized in the statements
of income for the fiscal years ended March 31, 2018 and 2017, respectively, by applying the fair-value hedge method.

Note: A summary of Trading Securities and Money Held in Trust for investment purposes and related unrealized gains andlosses recognized in the statement of income are as follows: *Millions of yen
Unrealized
gains (losses)

Unrealized
gains (losses)

Thousands of U.S. dollars
2018
Unrealized
gains (losses)¥(51,558)¥(11,574)$(485,162)
Thousands of U.S. dollars
2018
Unrealized
Fair value gains (losses)

2018
As of March 31,

Trading Securities

2017

Millions of yen
2018

2017

As of March 31,

Fair value

Unrealized
gains (losses)

Fair value

Unrealized
gains (losses)

Money Held in Trust for
Investment¥334,230¥381¥244,297¥787* Fair values of trading securities as of March 31, 2018 and 2017 are described in “41. Financial Instruments.”

207

Fair Value of Securities and Money Held in Trust$3,145,109$3,5892018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Other Securities Sold during the Fiscal Year
Millions of yen
Total amount Total amount
Proceedsof gainsof losses
from sales
on saleson sales

For the Fiscal Year ended March 31,
2018

Stocks
Bonds
Japanese Government Bonds
Japanese Local
Government Bonds
Japanese Corporate Bonds
Other
Total

¥362,292
29,552,146
28,948,271¥185,676
26,102
22,739¥4,547
10,7289,781$3,409,166
278,085,503
272,403,047$1,747,217
245,628
213,975$42,796
100,958
92,041

97,4441,205

54

916,955

11,341

510

506,429
12,647,126¥42,561,564

2,158
168,482¥380,262

893
102,863¥118,139

4,765,501
119,009,373$400,504,042

20,312
1,585,422$3,578,267

8,407
967,941$1,111,695

Millions of yen
Total amount Total amount
Proceedsof gainsof losses
from sales
on saleson sales

For the Fiscal Year ended March 31,
2017

Stocks
Bonds
Japanese Government Bonds
Japanese Local
Government Bonds
Japanese Corporate Bonds
Other
Total

Thousands of U.S. dollars
Total amount Total amount
Proceedsof gainsof losses
from sales
on saleson sales¥402,281
29,061,379
28,478,921¥214,078
64,89961,450¥3,8799,713
9,297

35,032

2

16547,425
12,416,967¥41,880,628

3,447
164,900¥443,878

398
67,316¥80,908

Note: The above table contains Other Securities that are deemed extremely difficult to determine fair values.

Unrealized Gains/Losses on Other Securities
Unrealized Gains/Losses on Other Securities as of March 31, 2018 and 2017 are as follows:

As of March 31,

Difference between Acquisition Cost and Fair Value*1
Other Securities*2
Deferred Tax Liabilities
Difference between Acquisition Cost and Fair Value, net of Taxes
Amount Corresponding to Non-controlling Interests
Amount Corresponding to Net Unrealized Gains (Losses) on
Other Securities Owned by Affiliated Companies, which is
attributable to MHFGNet Unrealized Gains (Losses) on Other Securities

2017

Thousands of
U.S. dollars
2018¥1,925,837
1,925,837(518,090)
1,407,747
20,790¥1,784,855
1,784,855(470,704)
1,314,150
29,657$18,122,122
18,122,122(4,875,229)
13,246,893
195,642

5,436

5,492

51,157¥1,392,392¥1,289,985$13,102,408

Millions of yen
2018*1 The difference between acquisition cost and fair value excludes ¥(28,273) million ($(266,058) thousand) and ¥(34,372) million which were recognized in thestatements of income for the fiscal years ended March 31, 2018 and 2017, respectively, by applying the fair-value hedge method.
*2 Other Securities includes translation differences regarding securities which do not have readily determinable fair value.

208

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

43. Derivatives Information
The fair value of derivatives not qualifying for hedge accounting and derivatives qualifying for hedge accounting as ofMarch 31, 2018 and 2017 is shown in the tables below. In the following tables:(i) Contract value represents notional amounts for swap transactions and contract amounts for other transactions.
Contract value amounts do not indicate the market risk related to derivative transactions.
(ii) Fair values of listed contracts are based on the closing prices of the Osaka Exchange, the Tokyo Financial
Exchange, the New York Mercantile Exchange and others. Fair values of over-the-counter contracts and intercompany or internal transactions are based on the discounted value of future cash flows, option pricing models andothers.

(1) Derivative Transactions not Qualifying for Hedge Accounting
Transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated
statement of income.
(a) Interest Rate-Related Transactions

As of March 31, 2018

Listed:Futures:
Sold
BoughtOptions:
Sold
BoughtOver-the-Counter:
FRAs:
Sold
BoughtSwaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Receive Fixed / Pay Fixed
Options:
Sold
BoughtInter-company or Internal Transactions:Swaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Total

209

Derivatives Information

Contract value
Total
Over one year

Fair value

Millions of yen
Unrealized
gains (losses)¥7,629,009
7,382,738¥2,781,286
2,527,389¥24,873(26,372)¥24,873(26,372)

148,802
318,186

38,606
―

(157)
715

119
22

29,881,631
28,470,832

657,637
641,350(6,103)
4,272(6,103)
4,272

408,239,583
404,255,318
89,307,829
613,586

335,944,031
328,525,087
68,275,480
556,686

3,331,370(3,350,175)
42,651
5,675

3,331,370(3,350,175)
42,651
5,675

6,348,557
3,925,710

4,448,904
2,669,122(20,162)
19,766(20,162)
19,7665,802,848
10,811,184―/

5,629,482
9,824,803―/(42,404)
114,074―¥98,024(42,404)
114,074―¥97,607

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

As of March 31, 2017

Listed:Futures:
Sold
BoughtOptions:
Sold
BoughtOver-the-Counter:
FRAs:
Sold
BoughtSwaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Receive Fixed / Pay Fixed
Options:
Sold
BoughtInter-company or Internal Transactions:Swaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Total

Contract value
Total
Over one year

Fair value

Millions of yen
Unrealized
gains (losses)¥9,407,885
9,337,119¥3,325,791
3,323,117¥(10,782)
9,161¥(10,782)
9,161

320,424
885,81253,662
99,250

(478)
1,254

38
(217)

16,705,098
14,123,480

287,114276,538(4,529)(1,088)(4,529)(1,088)403,042,305
394,333,968
80,075,291
702,877

307,787,439
304,717,370
61,293,377
579,466

5,642,796(5,583,337)
35,82914,6055,642,796(5,583,337)
35,82914,605

8,117,121
5,642,995

5,719,369
3,661,695(104,505)
4,344(104,505)
4,344

4,430,985
9,442,652
707/

4,144,609
8,278,293
707
/

(906)
33,285
0¥35,649(906)
33,285
0¥34,694210

Derivatives Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

As of March 31, 2018

Listed:Futures:
Sold
BoughtOptions:
Sold
BoughtOver-the-Counter:
FRAs:
Sold
BoughtSwaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Receive Fixed / Pay Fixed
Options:
Sold
BoughtInter-company or Internal Transactions:Swaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Total

211

Derivatives Information

Contract value
Total
Over one year

Thousands of U.S. dollars
Unrealized
Fair value
gains (losses)$71,788,932
69,471,519$26,171,886
23,782,720$234,058(248,169)$234,058(248,169)

1,400,232
2,994,129

363,288—(1,481)
6,735

1,121
211

281,185,955
267,910,345

6,188,362
6,035,102(57,430)
40,202(57,430)
40,202

3,841,531,792
3,804,039,880
840,386,087
5,773,846

3,161,231,122
3,091,418,907
642,471,826
5,238,418

31,348,174(31,525,128)
401,353
53,40531,348,174(31,525,128)
401,353
53,40559,739,885
36,940,913

41,864,164
25,116,429(189,732)
186,005(189,732)
186,005

54,604,769
101,733,171—/

52,973,393
92,451,339—/(399,026)
1,073,440—$922,406(399,026)
1,073,440—$918,484

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(b) Currency-Related Transactions

As of March 31, 2018

Listed:Futures:
Sold
BoughtOver-the-Counter:
Swaps
Forwards:
Sold
BoughtOptions:
Sold
BoughtInter-company or Internal Transactions:
Swaps
Forwards:
BoughtTotal

As of March 31, 2017

Listed:Futures:
Sold
BoughtOver-the-Counter:
Swaps
Forwards:
Sold
BoughtOptions:
Sold
BoughtInter-company or Internal Transactions:
Swaps
Forwards:
BoughtTotal

Contract value
Total
Over one year

Fair value

Millions of yen
Unrealized
gains (losses)¥21,239
92,245¥1,86022,828¥——¥——49,506,179

34,820,751

245,294

164,945

67,299,060
30,337,434

2,966,015
1,229,813

537,765(469,341)

537,765(469,341)

2,451,245
2,308,666

1,087,293
919,460(39,530)
66,225

14,894
8,218

3,190,555

2,362,942(250,755)

18,009165,472/—/(2,090)¥87,568(2,090)¥272,402

Fair value

Millions of yen
Unrealized
gains (losses)

Contract value
Total
Over one year

¥18,88175,501¥352
51,302¥——¥——45,250,084

30,758,244

54,48999,071

74,925,435
37,970,407

3,645,808
1,352,535(92,135)
203,068(92,135)
203,068

2,842,595
2,610,743

1,182,247
1,034,441(89,735)
67,939(9,821)(12,408)

3,441,048

2,403,067(228,425)

6,386

160,189/—/(2,328)¥(87,128)(2,328)¥191,831

212

Derivatives Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

As of March 31, 2018

Listed:Futures:
Sold
BoughtOver-the-Counter:
Swaps
Forwards:
Sold
BoughtOptions:
Sold
BoughtInter-company or Internal Transactions:
Swaps
Forwards:
BoughtTotal

Contract value
Total
Over one year

Thousands of U.S. dollars
Unrealized
Fair value
gains (losses)$199,861
868,027$17,504
214,819

$—
—

$—
—

465,852,826

327,663,040

2,308,218

1,552,141

633,283,721
285,475,057

27,910,188
11,572,538

5,060,372(4,416,498)

5,060,372(4,416,498)

23,066,202
21,724,538

10,231,427
8,652,116(371,982)
623,183

140,158
77,33830,023,102

22,235,277(2,359,604)

169,471

1,557,092/—/(19,674)$824,015(19,674)$2,563,308

Fair value

Millions of yen
Unrealized
gains (losses)(c) Stock-Related Transactions

As of March 31, 2018

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Equity Linked Swaps
Options:
Sold
BoughtOther:
Sold
BoughtTotal

213

Derivatives Information

Contract value
Total
Over one year

¥345,159
677,676¥10,570—¥1,986
8,524¥1,986
8,524

1,788,049
1,733,309

422,988371,505(78,493)
71,196(3,245)
1,012

242,490

220,351

13,93813,938705,136
334,443

412,365
141,885(73,573)
103,731(73,573)
103,731

164,010434,136/

37,531
303,637/(1,004)37,958¥84,265(1,004)37,958¥89,329

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

As of March 31, 2017

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Equity Linked Swaps
Options:
Sold
BoughtOther:
Sold
BoughtTotal

As of March 31, 2018

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Equity Linked Swaps
Options:
Sold
BoughtOther:
Sold
BoughtTotal

Contract value
Total
Over one year

Fair value

Millions of yen
Unrealized
gains (losses)¥701,220
143,890¥14,450—¥2,230(673)¥2,230(673)

1,033,746
1,018,815

178,675
101,900(125,078)
27,430(5,077)
10

191,842

178,713

11,513

11,513687,884
231,697

587,391
177,712(83,546)
77,950(77,815)
67,701—
414,495/—
377,583/—
24,548¥(65,623)—
24,548¥22,438

Contract value
Total
Over one year

Thousands of U.S. dollars
Unrealized
Fair value
gains (losses)$3,247,944
6,376,929$99,464—$18,695
80,218$18,695
80,218

16,825,530
16,310,431

3,980,319
3,495,860(738,625)
669,960(30,540)
9,529

2,281,836

2,073,511

131,163

131,1636,635,329
3,147,115

3,880,358
1,335,141(692,326)
976,114(692,326)
976,114

1,543,334
4,085,221/

353,170
2,857,229/(9,448)357,188$792,939(9,448)357,188$840,593

214

Derivatives Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(d) Bond-Related Transactions
Millions of yen
2018

2017

Contract value
As of March 31,

Listed:Futures:
Sold
BoughtFutures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtOther:
Sold
BoughtTotal

Contract value
Fair
Unrealized
value gains (losses)

Total

Over
one year

Total

Over
one year¥795,996
626,268¥——¥(4,155)
4,206

265,529
158,042——

827,444827,685
357,473
297,989/¥(4,155)
4,206¥584,499
594,999¥——¥(4,497)
2,508¥(4,497)
2,508

(246)
184

(104)
48

543,534
143,612

—
—

(86)
150

16
1

283,966
283,966(26,511)26,040(25,779)
25,702745,840
745,840

420,735
420,735(40,317)
40,136(38,567)
38,777

—
—
/

(664)
271
¥(875)(664)
271¥(475)

—
—
/

—
—
/

—
—
¥(2,105)——¥(1,759)

Thousands of U.S. dollars
2018
Contract value
As of March 31,

Total

Listed:Futures:Sold$7,490,325
Bought
5,893,183
Futures Options:Sold2,498,633
Bought1,487,179
Over-the-Counter:
Options:
Sold
7,786,243
Bought7,788,517
Other:
Sold
3,363,820
Bought2,804,078
Total
/

215

Derivatives InformationOver
One year

Fair
Unrealized
value gains (losses)$――$(39,106)
39,580$(39,106)
39,580――(2,317)
1,732

(985)
457

2,672,123
2,672,123(249,469)
245,041(242,586)
241,864――/(6,254)2,552$(8,241)(6,254)
2,552$(4,478)

Unrealized
Fairvalue gains (losses)

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(e) Commodity-Related Transactions
Millions of yen
2018

2017

Contract value
As of March 31,

Listed:Futures:
Sold
BoughtOver-the-Counter:
Swaps
Options:
Sold
BoughtTotal

Contract value
Fair
Unrealized
value gains (losses)

Total

Over
one year

Total

Over
one year

Unrealized
Fairvalue gains (losses)¥22,101
32,891¥3,108
8,979¥(3,563)5,675¥(3,563)
5,675¥22,236
32,199¥7,206
13,568

¥358
(548)

¥358
(548)

2,516

—

0

0

5,296

—

1

1

147,475
130,003/

50,06840,133/(7,871)
7,508¥1,749(7,871)
7,508¥1,749158,283
141,703/63,80149,791
/

3,136
(949)
¥1,9973,136(949)¥1,997

Thousands of U.S. dollars
2018
Contract value
As of March 31,

Listed:Futures:
Sold
BoughtOver-the-Counter:
Swaps
Options:
Sold
BoughtTotal

Fair
Unrealized
value gains (losses)

Total

Over
one year$207,979
309,506$29,254
84,500$(33,534)
53,402$(33,534)
53,402

23,683―8

81,387,740
1,223,334/

471,147
377,655/(74,071)
70,656$16,461(74,071)
70,656$16,461

Note: Commodities include oil, copper, aluminum and others.

216

Derivatives Information

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(f) Credit Derivative Transactions

As of March 31, 2018

Over-the-Counter:
Credit Derivatives:
Sold
BoughtTotal

As of March 31, 2017

Over-the-Counter:
Credit Derivatives:
Sold
BoughtTotal

As of March 31, 2018

Over-the-Counter:
Credit Derivatives:
Sold
BoughtTotal

Contract value
Total
Over one year

¥1,302,042
1,541,030/¥973,507
1,147,481/

Contract value
Total
Over one year

¥1,845,011
1,995,013/¥1,337,735
1,435,409/

Contract value
Total
Over one year

$12,252,211
14,501,090/$9,160,695
10,797,795/

Note: “Sold” and “Bought” indicate assumption and cession of credit risk, respectively.

217

Derivatives Information

Fair value

Millions of yen
Unrealized
gains (losses)¥19,445(22,392)¥(2,947)¥19,445(22,392)¥(2,947)

Fair value

Millions of yen
Unrealized
gains (losses)¥22,061(24,813)¥(2,751)¥22,061(24,813)¥(2,751)

Thousands of U.S. dollars
Unrealized
Fair value
gains (losses)$182,980(210,714)$(27,734)$182,980(210,714)$(27,734)

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(2) Derivative Transactions Qualifying for Hedge Accounting(a) Interest Rate-Related Transactions
Millions of yen
As of March 31, 2018

Primary Method :Swaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Fair Value Hedge Method :Swaps:
Receive Float / Pay Fixed
Receive Float / Pay Float
Exceptional Accrual Method :Swaps:
Receive Float / Pay Fixed
Total

Primary
hedged items

Loans, deposits, bonds
and notes, borrowings andothersContract value
Total
Over one year

Fair value¥25,251,272
7,281,066¥20,768,457
7,076,303¥(32,646)
29,562335,553―

325,421―5,724―

57,478/51,379/Other securities and others

Loans and others
Note 2¥2,640Millions of yen

As of March 31, 2017

Primary Method :Swaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Fair Value Hedge Method :Swaps:
Receive Float / Pay Fixed
Receive Float / Pay Float
Exceptional Accrual Method :Swaps:
Receive Float / Pay Fixed
Total

Primary
hedged items

Loans, deposits, bonds
and notes, borrowings andothersContract value
Total
Over one year

Fair value¥25,079,445
6,850,334¥22,542,261
5,939,596¥93,716(23,638)

439,177
591

437,488
92

(472)
(105)

66,882/62,314/

Other securities and others

Loans and others
Note 2¥69,499

218

Derivatives Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

As of March 31, 2018

Primary Method :Swaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Fair Value Hedge Method :Swaps:
Receive Float / Pay Fixed
Receive Float / Pay Float
Exceptional Accrual Method :Swaps:
Receive Float / Pay Fixed
Total

Primary
hedged items

Loans, deposits, bonds
and notes, borrowings andothersThousands of U.S. dollars
Contract value
Total
Over one year
Fair value$237,614,303
68,514,788$195,431,050
66,587,965$(307,202)
278,184

3,157,560―

3,062,213―

53,867―

540,870/

483,484/

Other securities and others

Loans and others
Note 2$24,849

Notes: 1. Primarily the deferred method is applied under “Accounting and Auditing Treatment Relating to Adoption of
Accounting Standards for Financial Instruments for Banks” (JICPA Industry Audit Committee Report No. 24,
February 13, 2002).
2. Since derivative transactions qualifying for the exceptional accrual method are treated as a unit of loans andborrowings, hedged items, those fair values are included in fair values of such loans and borrowings in “41.
Financial Instruments.”(b) Currency-Related Transactions
Millions of yen
As of March 31, 2018

Primary Method :Swaps
Forwards:
Sold
Total

Primary
hedged items

Loans, deposits, borrowings,
parent company’s interest of
subsidiaries’ net assets andothersContract value
Total
Over one year

Fair value¥6,940,073¥2,739,832¥238,620

166,448
/

―
/

2,083
¥240,704
Millions of yen

As of March 31, 2017

Primary Method :Swaps
Forwards:
Sold
Total

As of March 31, 2018

Primary Method :Swaps
Forwards:
Sold
Total

Primary
hedged items

Loans, deposits, borrowings,
parent company’s interest of
subsidiaries’ net assets andothersPrimary
hedged items

Loans, deposits, borrowings,
parent company’s interest of
subsidiaries’ net assets andothersContract value
Total
Over one year

Fair value¥7,179,955¥2,939,738¥235,186

276,436
/

—
/

2,273
¥237,460

Thousands of U.S. dollars
Contract value
Total
Over one year
Fair value$65,306,042$25,781,809$2,245,420

1,566,282/—/

19,605$2,265,025

Notes: 1. Primarily the deferred method is applied under “Accounting and Auditing Treatment Relating to Adoption of
Accounting Standards for Foreign Currency Transactions for Banks” (JICPA Industry Audit Committee Report No.
25, July 29, 2002).
2. Forward Exchange Contracts qualifying for the allocation method are treated as a unit of short-term bonds,
hedged items.

219

Derivatives Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(c) Stock-Related Transactions
Millions of yen
As of March 31, 2018

Fair Value Hedge Method :Forward Stock Agreements:
Sold
Total

Primary
hedged items

Contract value
Total
Over one year

Fair value

Other securities¥161,773/¥146,226/¥(8,561)¥(8,561)
Millions of yen

As of March 31, 2017

Fair Value Hedge Method :Forward Stock Agreements:
Sold
Total

As of March 31, 2018

Fair Value Hedge Method :Forward Stock Agreements:
Sold
Total

Primary
hedged items

Contract value
Total
Over one year

Fair value

Other securities¥154,072/

Primary
hedged items¥40,175/¥(4,608)¥(4,608)

Thousands of U.S. dollars
Contract value
Total
Over one year
Fair value

Other securities$1,522,288/$1,375,990/$(80,560)$(80,560)

220

Derivatives Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

44. Segment Information
Segment Information by Management Approach

1. Summary of Reportable Segment
MHFG has introduced an in-house company system based on the group’s diverse customer segments. The aim of thissystem is to leverage MHFG’s strengths and competitive advantage, which is the seamless integration of MHFG’s banking,trust and securities functions under a holding company structure, to speedily provide high-quality financial services thatclosely match customer needs.
Specifically, the company system is classified into the following five in-house companies, each based on a customer
segment: the Retail & Business Banking Company, the Corporate & Institutional Company, the Global Corporate Company,
the Global Markets Company, and the Asset Management Company. The services that each in-house company is incharge of are as follows:
Retail & Business Banking Company:
Services for individual customers, small and medium-sized enterprises and middle market firms in Japan
Corporate & Institutional Company:
Services for large corporations, financial institutions and public corporations in Japan
Global Corporate Company:
Services for Japanese overseas affiliated corporate customers and non-Japanese corporate customers, etc.
Global Markets Company:
Investment services with respect to interest rates, equities and credits, etc., and other services
Asset Management Company:
Development of products and provision of services that match the asset management needs of its wide rangeof customers from individuals to institutional investors.
The reportable segment information, set forth below, is derived from the internal management reporting systems used bymanagement to measure the performance of the Group’s operating segments.
Management measures the performance of each of the operating segments in accordance with internal managerial
accounting rules and practices.

2. Calculating Method of Gross Profits (excluding the amounts of credit costs of trust accounts), Net
Business Profits (excluding the amounts of credit costs of trust accounts, before reversal of(provision for) general reserve for losses on loans), and the Amount of Assets by Reportable
Segment
The following information of reportable segment is based on internal management reporting:Gross profits (excluding the amounts of credit costs of trust accounts) is the total amount of Interest Income, Fiduciary
Income, Fee and Commission Income, Trading Income, and Other Operating Income.
Net business profits (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) generalreserve for losses on loans) is the amount of which General and administrative expenses (excluding non-recurring
expenses), Equity in income from investments in affiliates, and Others (consolidation adjustments) are deducted from, oradded to, Gross profits (excluding the amounts of credit costs of trust accounts).
Asset information by segment is not prepared on the grounds that management does not use asset information of eachsegment for the purpose of asset allocation or performance evaluation.
Gross profits (excluding the amounts of credit costs of trust accounts) relating to transactions between segments is basedon the current market prices.

221

Segment Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

3. Gross Profits (excluding the amounts of credit costs of trust accounts) and Net Business Profits or
Losses (excluding the amounts of credit costs of trust accounts, before reversal of (provision for)general reserve for losses on loans) by Reportable Segment
Millions of yen
MHFG (Consolidated)
For the Fiscal Year
ended March 31,2018

Gross profits:(excluding theamounts of credit
costs of trust
accounts)¥
General andadministrative
expenses(excluding NonRecurring Losses)
Equity in income
from investments
in affiliates
OthersNet businessprofits
or losses(excluding theamounts of credit
costs of trust
accounts, before
reversal of(provision for)general reserve
for losses onloans)¥

Retail &Business
BankingCompany

Corporate &Institutional
Company

Global Corporate Global Markets
Company
Company

AssetManagement
Company

Others(Note 2)

Total

726,200 ¥433,000 ¥352,600 ¥381,700 ¥50,200 ¥(28,342) ¥1,915,357

723,300

197,700

254,800

200,900

27,60053,822

1,458,122

12,700
—

1,000
—

2,400
—

—
—

3,100
—

2,274
(20,888)

21,474(20,888)

15,600 ¥236,300 ¥100,200 ¥25,700 ¥(100,779) ¥457,820

180,800 ¥222

Segment Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Millions of yen
MHFG (Consolidated)
For the Fiscal Year
ended March 31,2017

Gross profits:(excluding theamounts of credit
costs of trust
accounts)¥
General andadministrative
expenses(excluding NonRecurring Losses)
Equity in income
from investments
in affiliates
OthersNet businessprofits
or losses(excluding theamounts of credit
costs of trust
accounts, before
reversal of(provision for)general reserve
for losses onloans)¥

223

Segment Information

Retail &Business
BankingCompany

Corporate &Institutional
Company

Global Corporate Global Markets
Company
Company

AssetManagement
Company

Others(Note 2)

Total

717,200 ¥434,100 ¥358,300 ¥539,900 ¥48,900 ¥(5,659) ¥2,092,740

719,700

194,000

244,300

193,800

29,30039,392

1,420,492

14,900
—

1,000
—

1,000
—

—
—

400
—

1,599
(27,730)

18,899(27,730)

12,400 ¥

241,100 ¥115,000 ¥20,000 ¥(71,183) ¥663,416

346,100 ¥2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Thousands of U.S. dollars
MHFG (Consolidated)
For the Fiscal Year
ended March 31,2018

Retail &Business
BankingCompany

Corporate &Institutional
Company

Global Corporate Global Markets
Company
Company

Gross profits:(excluding theamounts of credit
costs of trust
accounts)$ 6,833,537 $ 4,074,527 $ 3,317,963 $ 3,591,795 $General andadministrative
expenses(excluding NonRecurring Losses)
6,806,248
1,860,356
2,397,666
1,890,468
Equity in income
from investments
in affiliates
119,507
9,410
22,584—
Others————Net businessprofits
or losses(excluding theamounts of credit
costs of trust
accounts, before
reversal of(provision for)general reserve
for losses onloans)$ 146,796 $ 2,223,581 $
942,881 $ 1,701,327 $AssetManagement
Company

Others(Note 2)

Total

472,382 $(266,703) $ 18,023,501

259,716

506,468

13,720,922

29,171—

21,401(196,560)

202,073(196,560)

241,837 $(948,330) $4,308,092

Notes: 1.Gross profits (excluding the amounts of credit costs of trust accounts) is reported instead of sales reported by general
corporations.
2.“Others” includes items which should be eliminated as internal transactions between each segment on a consolidated basis.
3.Following the change in allocation method for transactions between each segment and “Others” made in April, 2017,
reclassification was made on the above table for the fiscal year ended March 31,2017 to reflect the relevant change.

224

Segment Information

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

4. The Difference between the Total Amounts of Reportable Segments and the Recorded Amounts inConsolidated Statement of Income, and the Contents of the Difference (Matters relating toadjustment to difference)
The above amount of Gross profits (excluding the amounts of credit costs of trust accounts) and that of Net businessprofits (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) general reserve forlosses on loans) derived from internal management reporting by reportable segment are different from the amounts
recorded in Consolidated Statement of Income.
The contents of the difference for the period are as follows:(a) The Total of Gross Profits (excluding the amounts of credit costs of trust accounts) of Segment Information and
Ordinary Profits recorded in the Consolidated Statement of Income
Millions of yen
2018

2017

Thousands of
U.S. dollars
2018

Gross Profits(excluding the amounts of credit costs of trust accounts)¥
1,915,357 ¥
2,092,740 $
18,023,501
Other Ordinary Income
535,927
379,228
5,043,070
General and Administrative Expenses(1,488,973)(1,467,221)(14,011,234)
Other Ordinary Expenses(179,863)(267,233)(1,692,510)
Ordinary Profits recorded in Consolidated Statement of Income ¥782,447 ¥
737,512 $7,362,827
Note: Ordinary profits represents Total Income excluding certain special income less Total Expenses excluding certain
special expenses.
(b) The Total of Net Business Profits (excluding the amounts of credit costs of trust accounts, before reversal of(provision for) general reserve for losses on loans) of Segment Information and Income before Income Taxes
Recorded in Consolidated Statement of Income
Millions of yen
2018

Net Business Profits(excluding the amounts of credit costs of trust accounts, before
reversal of (provision for) general reserve for losses on loans)¥
Credit Costs for Trust Accounts
General and Administrative Expenses (non-recurring losses)
Expenses Related to Portfolio Problems (including reversal of(provision for) general reserve for losses on loans)
Gains on Reversal of Reserves for Possible Losses on Loansand others
Net Gains (Losses) Related to Stocks
Net Extraordinary Gains (Losses)
OthersIncome before Income Taxes Recorded in Consolidated¥
Statement of Income

225

Segment Information

2017

Thousands of
U.S. dollars
2018457,820 ¥—(30,851)

663,416 $—(46,729)

4,308,092—(290,312)(17,014)(80,201)(160,104)

173,327
272,035
17,506(72,870)

32,662
242,145
46,680(73,779)

1,631,013
2,559,852
164,732(685,714)

799,953 ¥784,193 $7,527,559

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

5. Related Information(a) Information about Geographic Areas(i) Ordinary income
Millions of yen
2018

Ordinary Income

Japan

¥

2,404,030 ¥Americas552,140 ¥EuropeAsia/Oceania
excluding Japan

195,497 ¥409,457 ¥Total

3,561,125
Millions of yen

2017

Ordinary Income

Japan

¥

2018

Ordinary Income

2,292,950 ¥

Japan

$

22,621,908 $Americas430,329 ¥Americas5,195,636 $EuropeAsia/Oceania
excluding Japan

181,277 ¥Europe388,342 ¥Total

3,292,900

Thousands of U.S. dollars
Asia/Oceania
excluding Japan
Total

1,839,633 $

3,852,989 $

33,510,166

Notes: 1.Geographic analyses are presented based on geographic contiguity, similarities in economic activities, andrelation of business operations. The above table shows Ordinary Income instead of sales of non-financial
companies.
2.Japan includes Ordinary Income of MHFG and domestic consolidated subsidiaries excluding overseas
branches, Americas includes Ordinary Income of consolidated subsidiaries and branches in Canada, theUnited States of America and others, Europe includes Ordinary Income of consolidated subsidiaries andbranches in the United Kingdom and others and Asia/Oceania includes Ordinary Income of consolidated
subsidiaries and branches in Hong Kong, the Republic of Singapore and others.
(ii) Tangible fixed assets
Information on tangible fixed assets by geographical areas as of March 31, 2018 and 2017 is not disclosed sincetangible fixed assets in Japan accounted for more than 90% of tangible fixed assets.
(b) Information about Major Customers
Information about major customers is not disclosed since there are no outside customers accounted for more than
10% of Ordinary Income of the Company.

226

Segment Information

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Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

6. Information about Impairment Loss on Tangible Fixed Assets by Reportable Segment
Millions of yen
MHFG (Consolidated)
For the Fiscal Year
ended March 31, 2018

Retail & BusinessBanking Company

Impairment Loss¥

— ¥Corporate &Institutional
Company

Global Corporate
Company— ¥Global Markets
Company

— ¥

— ¥

Asset
Management
Company— ¥Others6,960 ¥

Total

6,960

Millions of yen
MHFG (Consolidated)
For the Fiscal Year
ended March 31, 2017

Retail & BusinessBanking Company

Impairment Loss¥

— ¥Corporate &Institutional
Company

Global Corporate
Company— ¥Global Markets
Company

— ¥

— ¥

Asset
Management
Company— ¥Others6,651 ¥

Total

6,651

Thousands of U.S. dollars
MHFG (Consolidated)
For the Fiscal Year
ended March 31, 2018

Retail & BusinessBanking Company

Impairment Loss$

227

Segment Information― $Corporate &Institutional
Company

Global Corporate
Company― $Global Markets
Company

― $

― $

Asset
Management
Company― $Others65,498 $Total

65,4982018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

7. Information about Amortization and Unamortized Balance of Goodwill by Reportable Segment
Millions of yen
MHFG (Consolidated)
For the Fiscal Year ended
March 31, 2018

Amortization of Goodwill
Unamortized Balance ofGoodwill

Retail & BusinessBankingCompany

Corporate &Institutional
Company

Global Corporate Global Markets
Company
Company

AssetManagement
Company

Total

Others

¥

— ¥

— ¥

— ¥

— ¥

— ¥

4,154 ¥

4,154

¥

— ¥

— ¥

— ¥

— ¥

— ¥

70,515 ¥

70,515

Millions of yen
MHFG (Consolidated)
For the Fiscal Year ended
March 31, 2017

Amortization of Goodwill
Unamortized Balance ofGoodwill

Retail & BusinessBankingCompany

Corporate &Institutional
Company

Global Corporate Global Markets
Company
Company

AssetManagement
Company

Others

Total

¥

— ¥

— ¥

— ¥

— ¥

— ¥

2,816 ¥

2,816

¥

— ¥

— ¥

— ¥

— ¥

— ¥

74,772 ¥

74,772Thousands of U.S. dollars
MHFG (Consolidated)
For the Fiscal Year ended
March 31, 2018

Amortization of Goodwill
Unamortized Balance ofGoodwill

Retail & BusinessBankingCompany

Corporate &Institutional
Company

Global Corporate Global Markets
Company
Company

AssetManagement
Company

Others

Total

$

― $

― $

― $

― $

― $

39,093 $39,093

$

― $

― $

― $

― $

― $

663,551 $

663,551

228

Segment Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

8. Information about Gain on Negative Goodwill Incurred by Reportable Segment
For the fiscal years ended March 31, 2018 and 2017
・There is no applicable information.

45. Related Party
For the fiscal years ended March 31, 2018 and 2017
・There are no material additions to the current scope subject to disclosure.

229

Segment Information、Related Party

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

46. Per Share Information
Per share information as of or for the fiscal years ended March 31, 2018 and 2017 are calculated based on the following
information:
Yen
As of or for the fiscal years ended March 31,

Net Assets per Share of Common Stock
Profit Attributable to Owners of Parent per Share ofCommon Stock
Diluted Profit Attributable to Owners of Parent per
Share of Common Stock

2018

2017

U.S. dollars
2018¥357.41¥335.96

$3.36

22.72

23.86

0.21

22.72

23.78

0.21

Notes: 1. Total Net Assets per Share of Common Stock is based on the following information.
Millions of yen
As of March 31,

Total Net Assets
Deductions from Total Net Assets
Stock Acquisition Rights
Non-Controlling Interests
Net Assets (year-end) related to Common
StockYear-end Outstanding Shares of Common
Stock, based on which Total Net Assets
per Share of Common Stock was
calculated

2018

2017

Thousands of U.S. dollars
2018¥9,821,246
755,403
1,163
754,239¥9,273,361
751,093
1,754
749,339$92,417,867
7,108,339
10,952
7,097,387

9,065,843

8,522,268

85,309,528

25,364,815 Thousand shares 25,366,315 Thousand shares/

2. Profit Attributable to Owners of Parent per Share of Common Stock is based on the following information.
Millions of yen
For the fiscal years ended March 31,

Profit Attributable to Owners of Parent
Amount not attributable to Common Stock
Profit Attributable to Owners of Parent
related to Common Stock
Average Outstanding Shares of Common
Stock (during the period)

2018

2017

Thousands of U.S. dollars
2018¥576,547—¥603,544—$5,425,309—

576,547

603,5445,425,309

25,366,345 Thousand shares 25,285,898 Thousand shares/

3. Diluted Profit Attributable to Owners of Parent per Share of Common Stock is based on the following information.
Millions of yen
For the fiscal years ended March 31,

Adjustment to Profit Attributable to Ownersof Parent
Increased Number of Shares of Common
Stock
Preferred Stock
Stock Acquisition Rights
Description of Dilutive Securities whichwere not included in the Calculation of
Diluted Profit Attributable to Owners of
Parent per Share of Common Stock asthey have no Dilutive effects

2018

2017

Thousands of U.S. dollars
2018

¥—

¥—

$—

7,585 Thousand shares—
7,585 Thousand shares—

94,403 Thousand shares
82,993 Thousand shares
11,409 Thousand shares

—

/
/
/

/

230

Per Share Information

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

4. In the calculation of Net Assets per Share of Common Stock, MHFG shares outstanding in BBT trust account thatwere recognized as Treasury Stock in Shareholders’ Equity are included in Treasury Stock shares deducted fromthe number of issued shares. The number of such Treasury Stock shares deducted during the period is 13,319
thousand and 9,000 thousand as of March 31, 2018 and 2017, respectively.
In the calculation of Profit Attributable to Owners of Parent per Share of Common Stock and Diluted Profit
Attributable to Owners of Parent per Share of Common Stock, such Treasury Stock shares are included in
Treasury Stock shares deducted in the calculation of the Average Outstanding Shares of Common Stock during
the period. The average number of such Treasury Stock shares deducted during the period is 11,815 thousand
and 6,000 thousand as of March 31, 2018 and 2017, respectively.

47. Subsequent Events
Mizuho Financial Group, Inc. decided to redeem in full preferred securities issued by its group's overseas special purpose
subsidiaries on May 15, 2018, as set forth below.
(1) Issuer(2) Type of securities(3) Total redemption amount(4) Scheduled redemption date(5) Major reasons for the redemption

231

Per Share Information、Subsequent Events

Mizuho Capital Investment (JPY) 2 Limited
Non-cumulative Perpetual Preferred Securities¥274,500 million
June 30, 2018
Arrival of optional redemption date

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Financial Statements ofMizuho Financial Group, Inc. and Three Subsidiaries[Under Japanese GAAP]

Mizuho Financial Group, Inc.
233

Non-Consolidated Balance Sheet

234

Non-Consolidated Statement of Income

Mizuho Bank, Ltd.
235

Non-Consolidated Balance Sheet

237

Non-Consolidated Statement of Income

Mizuho Trust & Banking Co., Ltd.
238

Non-Consolidated Balance Sheet

240

Non-Consolidated Statement of Income

Mizuho Securities Co., Ltd.
241

Non-Consolidated Balance Sheet

244

Non-Consolidated Statement of Income

232

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries-Index

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries

Mizuho Financial Group, Inc.

Non-Consolidated Balance Sheet
Millions of yen
2018

As of March 31,

AssetsCurrent Assets
Cash and Due from Banks
Other Current Assets
Fixed Assets
Tangible Fixed Assets
Intangible Fixed Assets
Investments in Subsidiaries and Affiliates
Other Investments
Total Assets
Liabilities and Net Assets
Liabilities
Current Liabilities
Short-term Borrowings
Short-term Bonds
Other Current Liabilities
Non-Current Liabilities
Total Liabilities
Net Assets
Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Other Capital Surplus
Retained Earnings
Appropriated Reserve
Other Retained Earnings
Retained Earnings Brought Forward
Treasury Stock
Valuation and Translation Adjustments
Net Unrealized Gains ( Losses) on Other Securities, net of Taxes
Stock Acquisition Rights
Total Net Assets
Total Liabilities and Net Assets¥

106,000
23,491
82,508
10,481,718
211,622
13,441
6,074,554
4,182,100¥ 10,587,719

¥

¥

¥

¥

1,109,452
1,083,135－
26,317
4,036,923
5,146,375
5,354,533
2,256,548
1,196,478
1,196,440
37
1,906,557
4,350
1,902,207
1,902,207(5,050)85,64585,645
1,163
5,441,343
10,587,719

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

233

Non-Consolidated Balance Sheet¥¥

Thousands of
U.S. dollars
2018

2017

112,350
20,19092,1599,157,019
205,518
12,705
6,074,554
2,864,240
9,269,369

1,179,516
656,100
500,000
23,416
2,747,329
3,926,845
5,288,113
2,256,275
1,196,258
1,196,167
91
1,839,725
4,350
1,835,375
1,835,375(4,145)52,65552,6551,754
5,342,523
9,269,369

$

$

$

$

997,463
221,055
776,408
98,632,904
1,991,362
126,480
57,161,522
39,353,540
99,630,367

10,439,944
10,192,293－
247,651
37,987,420
48,427,364
50,386,125
21,234,108
11,258,850
11,258,499
351
17,940,691
40,933
17,899,758
17,899,758(47,524)805,926
805,926
10,952
51,203,003
99,630,367

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Statement of Income
Millions of yen
2018

For the Fiscal Years ended March 31,

Operating Income
Cash Dividends Received from Subsidiaries and Affiliates
Fee and Commission Income Received from Subsidiaries andAffiliates
Operating Expenses
General and Administrative Expenses
Operating Profits
Non-Operating Income
Non-Operating Expenses
Income before Income Taxes
Income Taxes:
Current
Deferred
Net Income¥¥

305,097
256,044¥2017

378,084
328,148

Thousands of
U.S. dollars
2018$

2,870,967
2,409,376

49,05338,66038,660266,436
72,86980,556
258,749

49,93638,92638,926339,157
44,55856,302
327,414461,591
363,797363,797
2,507,170
685,701
758,035
2,434,836

2,272
(715)
257,192

519
217
326,676

21,389(6,732)2,420,179¥$

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

234

Non-Consolidated Statement of Income

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries

Mizuho Bank, Ltd.

Non-Consolidated Balance Sheet

As of March 31,

AssetsCash and Due from Banks
Call Loans
Receivables under Resale Agreements
Other Debt Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Tangible Fixed Assets
Buildings
Land
Lease Assets
Construction in Progress
Other Tangible Fixed Assets
Intangible Fixed Assets
SoftwareLease Assets
Other Intangible Fixed Assets
Prepaid Pension Cost
Customers' Liabilities for Acceptances and Guarantees
Reserves for Possible Losses on Loans
Reserve for Possible Losses on Investments
Total Assets

235

Non-Consolidated Balance Sheet

2017

Thousands of
U.S. dollars
2018¥38,943,082
433,198
596,194
728,080
4,234,901
3,137
31,264,703
71,262,838
1,769,212
5,470,641
828,363
308,823
415,294
24,75818,153
61,332754,547
223,925
15,488515,133
481,968
5,757,150(437,689)―¥162,090,330$363,467,885
3,446,792
6,016,300
4,169,913
32,630,029
28,949312,317,300
668,088,174
18,770,381
60,289,456
7,582,865
2,862,338
3,856,969
228,710135,204
499,6447,525,396
1,870,482
160,089
5,494,825
4,304,638
58,218,634(2,445,216)(3,010)$1,544,408,486

Millions of yen
2018¥38,625,732
366,290
639,352
443,136
3,467,593
3,076
33,189,959
70,997,730
1,994,728
6,406,960
805,831304,180
409,880
24,304
14,36853,097
799,723
198,776
17,012583,935
457,453
6,186,894(259,853)(319)¥164,124,289

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Balance Sheet—(Continued)

As of March 31,

Liabilities and Shareholders' Equity
Liabilities
Deposits
Call Money
Payables under Repurchase Agreements
Guarantee Deposits Received under Securities Lending
Transactions
Commercial Paper
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Bonds and Notes
Other Liabilities
Reserve for Bonus Payments
Reserve for Variable Compensation
Reserve for Possible Losses on Sales of Loans
Reserve for Contingencies
Reserve for Reimbursement of Deposits
Reserve for Reimbursement of Debentures
Deferred Tax Liabilities
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees
Total Liabilities
Net Assets
Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Other Capital Surplus
Retained Earnings
Appropriated Reserve
Other Retained Earnings
Retained Earnings Brought Forward
Valuation and Translation Adjustments
Net Unrealized Gains (Losses) on Other Securities, net of Taxes
Net Deferred Hedge Gains (Losses), net of Taxes
Revaluation Reserve for Land, net of Taxes
Total Net Assets
Total Liabilities and Net Assets

2017

Thousands of
U.S. dollars
2018¥121,068,919
1,165,198
7,200,312¥117,881,635
775,450
7,604,970$1,139,257,735
10,964,512
67,754,892

610,357
710,391
2,797,942
8,958,612
689,958
2,421,033
4,530,602
22,741
1,293
1,075
56
18,09730,760181,914
66,186
6,186,894
156,662,350

335,575
765,146
3,362,426
9,136,351
729,532
3,726,331
4,453,787
20,902
1,269
298
52
17,57532,720186,153
66,5855,757,150
154,853,914

5,743,462
6,684,778
26,328,621
84,300,488
6,492,503
22,781,913
42,632,942
213,994
12,176
10,118530
170,296
289,460
1,711,815
622,813
58,218,634
1,474,191,682

6,234,632
1,404,065
2,286,328
655,418
1,630,910
2,544,238
266,664
2,277,574
2,277,574
1,227,306
1,159,210(76,180)
144,277
7,461,939

5,988,810
1,404,065
2,286,328
655,418
1,630,910
2,298,416
225,810
2,072,606
2,072,606
1,247,605
1,099,468
2,527
145,6097,236,415

58,667,854
13,212,242
21,514,341
6,167,480
15,346,861
23,941,271
2,509,309
21,431,962
21,431,962
11,548,950
10,908,159(716,861)
1,357,652
70,216,804¥164,124,289¥162,090,330$1,544,408,486

Millions of yen
2018

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

236

Non-Consolidated Balance Sheet2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries

Mizuho Bank, Ltd.

Non-Consolidated Statement of Income

For the Fiscal Years ended March 31,

IncomeInterest Income
Loans and Bills Discounted
Securities
Fee and Commission Income
Trading Income
Other Operating Income
Other Income
Total Income
Expenses
Interest Expenses
Deposits
Fee and Commission Expenses
Trading Expenses
Other Operating Expenses
General and Administrative Expenses
Other Expenses
Total Expenses
Income before Income Taxes
Income Taxes:
Current
Deferred
Net Income

2017

Thousands of
U.S. dollars
2018¥1,329,397
881,798
264,815
463,170
56,629157,685
491,277
2,498,159¥1,204,728
820,861
257,345
470,240
81,202
191,592
287,9222,235,686$12,509,620
8,297,721
2,491,916
4,358,435
532,881
1,483,817
4,622,916
23,507,669

651,748
340,252
92,481
567
83,246905,103
182,103
1,915,250

484,970
239,159
93,982792
47,643
901,693
251,650
1,780,732

6,132,950
3,201,770
870,255
5,340
783,3448,517,017
1,713,593
18,022,499

582,908

454,954

5,485,170

135,348(1,332)¥448,893

129,486(17,098)¥342,566

1,273,625(12,537)$4,224,082

Millions of yen
2018

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

237

Non-Consolidated Statement of Income

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries

Mizuho Trust & Banking Co., Ltd.

Non-Consolidated Balance Sheet

As of March 31,

AssetsCash and Due from Banks
Call Loans
Guarantee Deposits Paid under Securities Borrowing Transactions
Other Debt Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Tangible Fixed Assets
Buildings
Land
Construction in Progress
Other Tangible Fixed Assets
Intangible Fixed Assets
Software
Other Intangible Fixed Assets
Prepaid Pension Cost
Customers' Liabilities for Acceptances and Guarantees
Reserves for Possible Losses on Loans
Total Assets

2017

Thousands of
U.S. dollars
2018¥1,699,040
6,956
113,046
9,196
90,4873,286
1,253,105
3,326,296
2,596
83,804
23,617
10,54910,153
1
2,913
33,477
14,68918,78749,23023,887(4,779)¥6,713,251$16,483,306
27,0002,078,995
75,184
748,583
30,103
10,275,243
32,311,570
21,345
1,615,992
204,784
90,38386,431―
27,970329,738
106,970
222,768
466,665
188,736(17,409)$64,839,835

Millions of yen
2018¥1,751,680
2,869
220,934
7,989
79,551
3,199
1,091,950
3,433,750
2,268
171,731
21,762
9,605
9,185
―
2,972
35,041
11,367
23,67349,592
20,056(1,850)¥6,890,529

238

Non-Consolidated Balance Sheet2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries

Mizuho Trust & Banking Co., Ltd.

Non-Consolidated Balance Sheet―(Continued)

As of March 31,

Liabilities and Shareholders' Equity
Liabilities
Deposits
Call Money
Payables under Repurchase Agreements
Guarantee Deposits Received under Securities Lending
Transactions
Trading Liabilities
Borrowed Money
Bonds and Notes
Due to Trust Accounts
Other Liabilities
Reserve for Bonus Payments
Reserve for Variable Compensation
Reserve for Reimbursement of Deposits
Deferred Tax Liabilities
Acceptances and Guarantees
Total Liabilities
Net Assets
Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Retained Earnings
Appropriated Reserve
Other Retained Earnings
Retained Earnings Brought Forward
Valuation and Translation Adjustments
Net Unrealized Gains (Losses) on Other Securities, net of Taxes
Net Deferred Hedge Gains (Losses), net of Taxes
Total Net Assets
Total Liabilities and Net Assets

2017

Thousands of
U.S. dollars
2018¥3,878,768
469,882
53,135¥3,715,010
242,493
67,320$36,499,188
4,421,588
500,000

180,728
69,367
387,490
10,0001,134,182
78,418
2,097
511
1,913
13,646
20,0566,300,200

310,303
83,683
372,578
10,0001,272,149
36,173
1,976
413
1,496
9,692
23,887
6,147,179

1,700,658
652,746
3,646,286
94,10010,672,652
737,919
19,742
4,813
18,008
128,412
188,736
59,284,848

489,445
247,369
15,505
15,505
226,570
31,970
194,599
194,599
100,882
99,2581,624
590,328

467,888
247,369
15,505
15,505205,01327,427
177,585
177,585
98,18396,5291,654
566,071

4,605,680
2,327,747
145,904
145,904
2,132,029
300,846
1,831,183
1,831,183
949,307934,023
15,284
5,554,987¥6,890,529¥6,713,251$64,839,835

Millions of yen
2018

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

239

Non-Consolidated Balance Sheet2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Statement of Income

For the Fiscal Years ended March 31,

IncomeFiduciary Income
Interest Income
Loans and Bills Discounted
Securities
Fee and Commission Income
Trading Income
Other Operating Income
Other Income
Total Income
Expenses
Interest Expenses
Deposits
Fee and Commission Expenses
Trading Expenses
Other Operating Expenses
General and Administrative Expenses
Other Expenses
Total Expenses
Income before Income Taxes
Income Taxes:
Current
Deferred
Net Income

2017

Thousands of
U.S. dollars
2018¥54,819
43,672
25,38813,731
65,373954
4,103
37,019205,942¥50,075
39,80525,817
12,25958,874
1,180
14,48333,608198,028$515,849
410,961
238,906
129,214615,166
8,982
38,611
348,349
1,937,918

12,595
1,079
31,04260
10,71787,276
7,641
149,333

10,221
1,288
27,5450
5,556
86,723
6,628
136,675

118,526
10,155292,105
568
100,853821,273
71,902
1,405,227

56,60961,352532,691

13,097(761)¥44,272

16,787(917)¥45,482

123,249(7,163)$416,605

Millions of yen
2018

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

240

Non-Consolidated Statement of Income

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Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries

Mizuho Securities Co., Ltd.

Non-Consolidated Balance Sheet

As of March 31,

AssetsCurrent Assets
Cash and Due from Banks
Cash Segregated as Deposits for Customers and Others
Trading Assets
Trading Securities and Others
Derivatives
Receivables - unsettled Trades
Operating Investment Securities
Operating Loans Receivable
Receivables Related to Margin Transactions
Loans Receivable under Margin Transactions
Cash Collateral for Borrowed Securities under Margin
Transactions
Collateralized Short-term Financing Agreements-receivable
Deposits Paid for Securities Borrowed
Securities Purchased under Agreements to Resell
Advances Paid
Short-term Guarantee Deposits
Securities: Fail to Deliver
Variation Margin Paid
Short-term Loans Receivable
Advance Payments
Prepaid Expenses
Accounts Receivable-otherAccrued income
Deferred Tax Assets
Other Current Assets
Less: Allowance for Doubtful Accounts
Total Current Assets
Noncurrent Assets
Tangible Fixed Assets
Intangible Fixed Assets
Investments and Other Assets
Investment Securities
Long-term Guarantee Deposits
Prepaid Pension Cost
Deferred Tax Assets
Other
Less: Allowance for Doubtful Accounts
Total Noncurrent Assets
Total Assets

241

Non-Consolidated Balance Sheet

2017

Thousands of
U.S. dollars
2018¥294,441
323,923
4,923,373
2,493,898
2,429,474―
25,362―
127,764
49,424¥249,691
230,2145,019,291
2,638,609
2,380,682
169,960
21,762
2,790
96,25535,251$2,770,696
3,048,117
46,328,908
23,467,568
22,861,340―
238,665―
1,202,259
465,083

78,3394,998,221
4,572,426
425,795
431
404,739
29,956
1,548
55,741535
2,978
21,697
27,406
13,5476,538(9)11,258,198

61,0033,821,571
3,506,714
314,856
191
496,793
28,695―22,459
690
3,193
6,495
26,45615,3024,009(6)
10,215,819

737,176
47,033,236
43,026,501
4,006,735
4,057
3,808,597
281,890
14,572524,529
5,036
28,024204,171
257,894
127,481
61,530(85)
105,939,577

14,64755,378295,186
252,068
11,202
16,716
3,154
15,528(3,482)365,213

15,08750,195297,330
246,267
11,75915,761
3,815
23,304(3,578)362,614

137,835
521,115
2,777,704
2,371,961
105,412
157,303
29,679146,119(32,770)
3,436,654¥11,623,412¥10,578,433$109,376,231

Millions of yen
2018

2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Balance Sheet―(Continued)

As of March 31,

Liabilities
Current Liabilities
Trading Liabilities
Trading Securities and Others
Derivatives
Payables - unsettled trades
Payables Related to Margin Transactions
Borrowings on Margin Transactions
Cash Collateral for Loaned Securities under Margin Transactions
Collateralized Short-term Financing Agreements-payable
Deposits Received for Securities Loaned
Securities Sold under Agreements to Repurchase
Deposits Received
Guarantee Deposits Received
Securities: Fail to Receive
Variation Margin Received
Short-term Borrowings
Commercial Paper
Bonds and Notes Due within One year
Lease Obligations
Advances Received
Accounts Payable-otherAccrued Expenses
Income Taxes Payable
Reserve for Bonus Payments
Provision for Variable Compensation
Provision for Bonus Point Redemption
Other Current Liabilities
Total Current Liabilities
Noncurrent Liabilities
Bonds and Notes
Long-term Borrowings
Lease Obligations
Provision for Retirement Benefits
Other Noncurrent Liabilities
Total Noncurrent Liabilities
Statutory Reserves
Reserve for Financial Instrument Transaction Liabilities
Total Statutory Reserves
Total Liabilities

2017

Thousands of
U.S. dollars
2018¥4,311,658
2,068,613
2,243,045
62,24344,1768,814
35,361
3,739,715
1,212,841
2,526,874
267,579
198,003
2,930―
833,668
334,200
46,672364
174
961
33,127
3,984
9,563
954
639
187
9,890,805¥3,771,283
1,299,676
2,471,607―
55,287
7,871
47,415
3,727,318
1,255,986
2,471,331
234,622
184,821
12,844
1,640
716,603111,300
55,323375
230
840
25,243―
13,432855
596
559
8,913,179$40,572,679
19,465,640
21,107,039
585,707415,700
82,944
332,756
35,190,699
11,412,826
23,777,873
2,517,926
1,863,213
27,578―
7,844,812
3,144,820
439,189
3,428
1,639
9,047
311,727
37,48989,997
8,983
6,014
1,768
93,072,415

571,334
277,000
139
19,744
1,540
869,758

554,903
233,500
494
19,5361,647
810,081

5,376,251
2,606,568
1,311
185,799
14,497
8,184,426

2,361
2,361

2,291
2,291

22,21822,218¥10,762,925¥9,725,551$101,279,059

Millions of yen
2018

242

Non-Consolidated Balance Sheet2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Three Subsidiaries

Mizuho Securities Co., Ltd.

Non-Consolidated Balance Sheet―(Continued)

As of March 31,

Net Assets
Shareholders' Equity
Common Stock
Capital Surplus
Additional Paid in Capital
Other Capital Surplus
Total Capital Surpluses
Retained Earnings
Other Retained Earnings
Retained Earnings Brought Forward
Total Retained Earnings
Total Shareholders’ Equity
Valuation and Translation Adjustments
Net Unrealized Gains on (Operating) Investment Securities, net ofTax
Net Deferred Gains or Losses on Hedges, net of Tax
Total Valuation and Translation Adjustments
Total Net Assets
Total Liabilities and Net Assets

2017

Thousands of
U.S. dollars
2018¥125,167¥125,167$1,177,824

285,831
95,817
381,649

285,831
95,817
381,649

2,689,672
901,646
3,591,318

338,142
338,142844,958

332,177
332,177
838,993

3,181,915
3,181,915
7,951,057

27,497(11,969)
15,52722,719(8,831)
13,887258,751(112,636)
146,115

Millions of yen
2018

860,486

852,8818,097,172¥11,623,412¥10,578,433$109,376,231

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

243

Non-Consolidated Balance Sheet2018/09/03 9:48:01 / 18439224_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Non-Consolidated Statement of Income

For the Fiscal Years ended March 31,

Operating Revenues
Commissions
Brokerage Commissions
Underwriting and Selling Fees, and Commissions from
Solicitation to Qualifying Investors
Offering, Selling, and Other Commissions and Fees, andCommissions from Solicitation to Qualifying Investors
Other commissions and Fees
Net Gain on Trading
Net Gain on Operating Investment Securities
Interest and Dividend Income
Total Operating Revenues

2017

Thousands of
U.S. dollars
2018¥142,534
30,818¥149,114
26,284$1,341,249
290,005

24,966

34,848234,938

31,37855,370114,858
2,300
67,061
326,755

25,53962,442
143,956
2,299
45,756341,126

295,270521,036
1,080,821
21,651
631,046
3,074,767

Millions of yen
2018Interest Expenses

57,14737,915

537,762

Net Operating Revenues
Selling, General and Administrative Expenses
Transaction-related Expenses
Personnel Expenses
Real Estate Expenses
Administrative Expenses
Depreciation and Amortization
Taxes and Dues
Provision of Allowance for Doubtful Accounts
Other
Operating Income
Non-operating Income
Non-operating Expenses
Ordinary Income
Extraordinary gain
Gain on Sales of Noncurrent Assets
Gain on Sales of Investment Securities
Gain on Sales of Shares of Subsidiaries and Affiliates
Extraordinary loss
Loss on Disposal of Noncurrent Assets
Loss on Sale of Investment Securities
Loss on Impairment of Investment Securities
Loss on liquidation of Subsidiaries and Affiliates
Loss on Impairment of Golf Club Membership
Impairment Losses
Loss on Software Development
Cost Incurred in Opening of Joint Branches
Provision of Reserve for Financial Instruments Transaction
Liabilities
Income before Income Taxes
Income Taxes – current
Income Taxes – deferred
Total Income Taxes
Net Income

269,607236,574
49,67685,562
26,63049,272
17,346
4,854
(58)
3,290
33,032
6,947
1,400
38,580
4,286
63
3,668
553
5,015
314
6
60
―
0
2,758
1,805
―

303,211
239,455
51,51387,96627,23749,355
17,143
2,801
(40)
3,477
63,7557,920
1,487
70,189119,27624
977
118,274
2,554
194
40
―
1,129
6
841
―
55

2,537,005
2,226,166
467,454805,142
250,596
463,654
163,227
45,676(551)
30,968310,839
65,38013,175363,044
40,331
600
34,523
5,208
47,199
2,963
58
569
―
1
25,962
16,987
―

70

285

659

37,850
4,092
1,596
5,689
¥32,161

186,911
161(13,968)(13,806)¥200,718

356,176
38,51415,02353,537$302,639

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥106.27=US$1.00, the foreign exchange rate on March 31, 2018, has been used for translation.

244

Non-Consolidated Statement of Income

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

245

白頁

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Basel Regulatory Disclosures

247

Key Metrics

248

Status of Mizuho Financial Group's
Consolidated Capital Adequacy

248

Scope of Consolidation

249

Risk-based Capital

266

Summary of Risk Management and Risk-weighted
Assets (RWA)

268

Linkages between Financial Statements
and Regulatory Exposures

271

Credit Risk

281

Counterparty Credit Risk

285

Securitization Exposures289

Market Risk

291

Investment or Equity Exposure

291

Operational Risk

292

Composition of Leverage Ratio

293

Indicators for Assessing Global Systemically
Important Banks (G-SIBs)

294

Disclosure of Information for the Fiscal Year
Ended on March 31, 2017 According
to the Relevant Old FSA Notice311

Status of Sound Management of Liquidity Risk

311

Liquidity Coverage Ratio

313

Status of Major Liquid Assets

313

Status of Major Funding

314

Compensation of Directors,
Corporate Auditors and Employees

246

Basel Regulatory Disclosures2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Key Metrics

Under the capital adequacy ratio regulations agreed upon by the Basel Committee on Banking Supervision, banks are
required to meet certain minimum capital requirements. We calculate our capital adequacy ratio on a consolidated basis
based on “the criteria used by a bank holding company for deciding whether or not the adequacy of equity capital of thebank holding company and its subsidiaries is appropriate in light of the assets owned by the bank holding company and its
subsidiaries pursuant to Article 52-25 of the Banking Law” (Financial Services Agency, or FSA, Notice No.20 issued in2006).
We also calculate our leverage ratio on a consolidated basis according to “the leverage ratio on a consolidated basis
separately prescribed by the Commissioner of the Financial Services Agency according to Article 1 Paragraph 1 item 7 of
the Matters Separately Prescribed by the Commissioner of the Financial Services Agency Regarding Status of the
Adequacy of Equity Capital pursuant to Article 19-2 Paragraph 1 Item 5 Sub-item (d) etc. of the Ordinance for the
Enforcement of the Banking Law” (FSA Notice No.13 issued in 2015).
Liquidity standards agreed upon by the Basel Committee on Banking Supervision require our liquidity coverage ratio tosurpass certain minimum standards. We calculate our consolidated liquidity coverage ratio (the “Consolidated LCR”) in
accordance with the regulation “The Evaluation Criterion on the Sound Management of Liquidity Risk Defined, Based on
Banking Law Article 52-25, as One of Criteria for Bank Holding Companies to Evaluate the Soundness of Their
Management and the Ones of Their Subsidiaries and Others, which is also One of Evaluation Criteria on the Soundness of
the Banks' Management”(the FSA Notice No. 62 of 2015 (the “Notice No. 62”)).

■ Key Metrics
KM1: Key Metrics
Basel III
Template
No.

Capital1
Common Equity Tier 1 capital
2
Tier 1 capital3
Total capital
Risk weighted assets
4
Risk weighted assets
Capital ratio
5
Common Equity Tier 1 capital ratio
6
Tier 1 capital ratio
7
Total capital ratio
Capital buffer8
Capital conservation buffer requirement
9Countercyclical buffer requirement
10
Bank G-SIB/D-SIB additional requirements
11
Total of bank CET1 specific buffer requirements
CET1 available after meeting the bank's
12minimum capital requirements
Leverage ratio
13
Total exposures
14
Leverage ratio
Liquidity coverage ratio (LCR)
Total HQLA allowed to be included in the15
calculation
16
Net cash outflows
17
LCR
Note: Base Ⅲ Template No. from 15 to 17 are quarterly averages.

247

Key Metrics(millions of yen, except percentages)a
As ofMarch 31,
2018

b

c

As of
As of
December 31, September 30,
2017
2017

d

e

As of
June 30,
2017

As of
March 31,2017

¥7,437,048
9,192,244
10,860,440¥7,597,964
9,321,858
11,260,104¥7,280,598
9,004,810
10,946,675¥7,157,984
8,423,437
10,410,297¥7,001,664
8,211,522
10,050,953

59,528,983

63,414,867

61,695,509

61,785,213

61,717,158

12.49%
15.44%
18.24%

11.98%
14.69%
17.75%

11.80%
14.59%
17.74%

11.58%
13.63%
16.84%

11.34%
13.30%
16.28%

1.87%
0.01%
0.75%
2.63%

1.25%
0.00%
0.50%
1.75%

1.25%
0.00%
0.50%
1.75%

1.25%
0.00%
0.50%
1.75%

1.25%
0.00%
0.50%
1.75%

7.99%

7.48%

7.30%

7.08%

6.84%

214,277,824
4.28%

217,478,350
4.28%

217,304,488
4.14%

208,006,656
4.04%

207,401,679
3.95%

60,159,630

63,459,113

60,568,697

61,146,475

59,034,682¥50,079,075
120.1%¥50,808,181
124.8%¥48,025,220
126.1%¥47,132,781
129.7%¥45,611,601
129.4%

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

Following the partial revision of “Matters Separately Prescribed by the Commissioner of the Financial Services Agency
Regarding Status of the Adequacy of Equity Capital Pursuant to Article 19-2, Paragraph 1, Item 5, Sub-item (d), etc. of theOrdinance for the Enforcement of the Banking Law,” the disclosure of any information concerning the fiscal year ended
March 31, 2018 is made in accordance with the relevant FSA Notice issued after the revision (the “New FSA Notice”). The
figures relating to our banking activities for the fiscal year ended March 31, 2017 are disclosed in accordance with therelevant FSA Notice issued before the revision (the “Old FSA Notice”) (See pages 294 to 310 for the disclosure items
which are different from those disclosed according to the new FSA Notice).

■ Scope of Consolidation(1) Scope of Consolidation for Calculating Consolidated Capital Adequacy Ratio(a) Difference from the Companies Included in the Scope of Consolidation Based on Consolidation Rules for
Preparation of Consolidated Financial Statements (the “Scope of Accounting Consolidation”)
None as of March 31, 2018 and 2017(b) Number of Consolidated Subsidiaries
Consolidated subsidiaries

As of March 31, 2018

As of March 31, 2017

124

139

Our major consolidated subsidiaries are Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd. and Mizuho Securities Co.,Ltd.
The following table sets forth information with respect to our principal consolidated subsidiaries as of March 31, 2018:

Name

Country oforganization

Domestic
Mizuho Bank, Ltd. ...........................................Japan
Mizuho Trust & Banking Co., Ltd. ...................Japan
Mizuho Securities Co., Ltd. .............................Japan
Mizuho Research Institute Ltd. .......................Japan
Mizuho Information & Research Institute Inc. . Japan
Asset Management One Co., Ltd. .................. Japan
Trust & Custody Services Bank, Ltd. .............. Japan
Mizuho Private Wealth Management Co., Ltd. Japan
Mizuho Credit Guarantee Co., Ltd. .................Japan
Mizuho Realty Co., Ltd. ...................................Japan
Mizuho Factors, Limited ..................................Japan
Mizuho Realty One Co., Ltd. ...........................Japan
Defined Contribution Plan Services Co., Ltd. ..Japan
Mizuho-DL Financial Technology Co., Ltd. .....JapanUC Card Co., Ltd. ...........................................Japan
J.Score CO., LTD............................................Japan
Mizuho Trust Systems Company, Limited. ..... Japan

Mizuho Capital Co., Ltd. ..................................Japan

Main businessBanking
Trust and banking
Securities
Research andconsulting
Information technology
Investment
management
Trust and banking
Consulting
Credit guarantee
Real estate agency
Factoring
Holding company
Pension planrelated business
Application andSophisticationof Financial Technology
Credit cardLending
Subcontracted
calculation services,
software development
Venture capital

Proportion ofownership
interest (%)

Proportion of
votinginterest (%)

100.0%
100.0
95.8
98.6

100.0%
100.0
95.8
98.6

91.5
70.0

91.5
51.0

54.0
100.0
100.0
100.0
100.0
100.0
60.0

54.0
100.0
100.0
100.0
100.0
100.0
60.0

60.0

60.0

51.0
50.0
50.0

51.0
50.0
50.0

50.0

50.0

248

Scope of Consolidation

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

Name

Country oforganization

Overseas
Mizuho Americas LLC .....................................U.S.A.
Mizuho Bank (China), Ltd. .............................. China
Mizuho International plc ..................................U.K.
Mizuho Securities Asia Limited .......................China
Mizuho Securities USA LLC ............................U.S.A.
Mizuho Bank Europe N.V. ...............................Netherlands
Banco Mizuho do Brasil S.A. .......................... Brazil
Mizuho Trust & Banking (Luxembourg) S.A. ...Luxembourg
Mizuho Bank (USA) ........................................U.S.A.
Mizuho Bank (Switzerland) Ltd ....................... Switzerland
Mizuho Capital Markets LLC .......................... U.S.A.
PT. Bank Mizuho Indonesia ............................Indonesia

Main businessHolding company
Banking
Securities and banking
Securities
Securities
Banking and securities
Banking
Trust and banking
Banking and trust
Banking and trust
Derivatives
Banking

Proportion ofownership
interest (%)

Proportion of
votinginterest (%)

100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
99.0

100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
99.0

(c) Corporations Providing Financial Services for Which Article 9 of the FSA Notice No. 20 is Applicable
None as of March 31, 2018 and 2017.
(d) Companies that are in the Bank Holding Company’s Corporate Group but not Included in the Scope of
Accounting Consolidation and Companies that are not in the Bank Holding Company’s Corporate Group but
Included in the Scope of Accounting Consolidation
None as of March 31, 2018 and 2017.
(e) Restrictions on Transfer of Funds or Capital within the Bank Holding Company’s Corporate Group
None as of March 31, 2018 and 2017.
(f) Names of Any Other Financial Institutions, etc., Classified as Subsidiaries or Other Members of the Bank
Holding Company that are Deficient in Regulatory Capital
None as of March 31, 2018 and 2017.

■ Risk-based Capital(1) Summary of Approach to Assessing Capital Adequacy
In order to ensure that risk-based capital is sufficiently maintained in light of the risk held by us, we regularly conduct thefollowing assessment of capital adequacy in addition to adopting a suitable and effective capital adequacy monitoring
structure.

Maintaining a sufficient BIS capital ratio
We confirm our maintenance of a high level of financial soundness by conducting regular evaluations to examine whether
our risk-based capital is adequate in qualitative as well as quantitative terms, in light of our business plans and strategic
targets to match the increase in risk-weighted assets acquired for growth, in addition to maintaining our capital above theminimum requirements of common equity Tier 1 capital ratio, Tier 1 capital ratio, total capital ratio and capital buffer ratio.

Balancing risk and capitalOn the basis of the framework for allocating risk capital, after obtaining the clearest possible grasp of the group’s overallrisk exposure, we endeavor to control risk so as to keep it within the range of our business capacity by means of allocating
capital that corresponds to the amount of risk to the principal banking subsidiaries, etc., within the bounds of our capital,
and we conduct regular assessments to ensure that a sufficient level of capital is maintained for our risk profile. Whenmaking these assessments, we calculate the potential losses arising from assumed stress events and risk volumes, which
we assess whether they balance with the group’s capital. Stress events are based on risk scenarios that are formulated
based on the current economic condition and the economic outlook, etc. and from scenarios such as the occurrence ofhistorical stress events. In addition, we examine whether an appropriate return on risk is maintained in the assessments.

249

Scope of Consolidation、Risk-based Capital2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(2) Composition of Capital, etc.
(a) Composition of Capital Disclosure (International Standard)
As of March 31, 2018

(Millions of yen)
As of March 31, 2017

Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangements

Basel III
template
Common equity Tier 1 capital: instruments and reserves (1)Directly issued qualifying common share
1a+2-1c-26 capital plus related stock surplus and retained
earnings
1aof which: capital and stock surplus¥7,292,638¥/¥6,905,510¥/

3,391,471/

3,390,691/

2of which: retained earnings

4,002,350/

3,614,841/

1cof which: treasury stock (-)

5,997

/

4,849

/

26

of which: national specific regulatory
adjustments (earnings to be distributed) (-)

95,186/

95,173

/

-

/

-

/

1,163

/

1,754

/

1,677,534/

1,216,780

304,195

14,344/

14,537///22,881///

22,881/

8,985,680/

8,161,464/

794,953/

619,806

154,951

85,103/

79,69519,923709,850/

540,111135,027

42,352/36,601

9,150¥(67,578)¥/¥8,137¥2,034of which: other than above
1b
3
5

6

Subscription rights to common shares
Accumulated other comprehensive income andother disclosed reserves
Common share capital issued by subsidiaries
and held by third parties (amount allowed ingroup CET1)
Total of items included in common equity Tier
1 capital: instruments and reserves subject tophase-out arrangementsof which: amount allowed in group CET1
capital subject to phase-out arrangementson common share capital issued bysubsidiaries and held by third parties
Common equity Tier 1 capital:(A)
instruments and reserves

Common equity Tier 1 capital: regulatory adjustments (2)
8+9
8
9

10

11

Total intangible assets (net of related tax
liability, excluding those relating to mortgage
servicing rights)
of which: goodwill (net of related tax liability,
including those equivalent)of which: other intangibles other than
goodwill and mortgage servicing rights (netof related tax liability)
Deferred tax assets that rely on future
profitability excluding those arising from
temporary differences (net of related tax
liability)
Deferred gains or losses on derivatives underhedge accounting

250

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(a) Composition of Capital Disclosure (International Standard)-(Continued)
As of March 31, 2018

(Millions of yen)
As of March 31, 2017

Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangements

Basel III
template
12
13

Shortfall of eligible provisions to expected
lossesSecuritization gain on sale

14

Gains and losses due to changes in own credit
risk on fair valued liabilities

15

Net defined benefit asset

16

Investments in own shares (excluding thosereported in the net assets section)

17

18

19+20+21
19
20
21
22
23
24
25

27
28

Reciprocal cross-holdings in common equity
Investments in the capital of banking, financial
and insurance entities that are outside thescope of regulatory consolidation, net of
eligible short positions, where the bank does
not own more than 10% of the issued sharecapital (amount above the 10% threshold)Amount exceeding the 10% threshold on
specified itemsof which: significant investments in thecommon stock of financialsof which: mortgage servicing rightsof which: deferred tax assets arising from
temporary differences (net of related tax
liability)
Amount exceeding the 15% threshold on
specified itemsof which: significant investments in thecommon stock of financialsof which: mortgage servicing rightsof which: deferred tax assets arising from
temporary differences (net of related tax
liability)
Regulatory adjustments applied to common
equity Tier 1 due to insufficient additional Tier
1 and Tier 2 to cover deductions
Common equity Tier 1 capital:(B)
regulatory adjustments¥61,964¥/¥9,381¥2,352

-

/

52

13

3,960

/

593

148

691,380/

443,158

110,789

1,457

/

5,473

1,368

-

/

-

-

20,140/36,595

9,148

-

/

-

-

-

/

-

-

-

/

-

-

-

/

-

-

-

/

-

-

-

/

-

-

-

/

-

-

-

/

-

-

-

/

-

/

1,548,631/

1,159,800/¥7,437,048¥/¥7,001,664¥/

Common equity Tier 1 capital (CET1)
29

Common equity Tier 1 capital (CET1)((A)-(B))

251

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As of March 31, 2018

(Millions of yen)
As of March 31, 2017

Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangements

Basel III
template
Additional Tier 1 capital: instruments (3)
30

31a

30

31b

30

32

30

34-35

33+35
33
35

36

Directly issued qualifying additional Tier 1
instruments plus related stock surplus ofwhich: classified as equity under applicableaccounting standards and the breakdown
Subscription rights to additional Tier 1
instruments
Directly issued qualifying additional Tier 1
instruments plus related stock surplus ofwhich: classified as liabilities under applicableaccounting standards
Qualifying additional Tier 1 instruments plus
related stock surplus issued by special
purpose vehicles and other equivalent entities
Additional Tier 1 instruments issued bysubsidiaries and held by third parties (amountallowed in group AT1)
Eligible Tier 1 capital instruments subject tophase-out arrangements included in additional
Tier 1 capital: instrumentsof which: directly issued capital instruments
subject to phase out from additional Tier 1of which: instruments issued by subsidiaries
subject to phase out
Total of items included in additional Tier 1
capital: instruments subject to phase-out
arrangementsof which: foreign currency translation
adjustments
Additional Tier 1 capital: instruments

(D)

¥-

¥/

¥-

¥/

-

/

-

/

1,220,000/

760,000

/

-

/

-

/

31,317/

31,786/

577,500/

577,500/

577,500/

577,500

/

-

/

-

/

/

/

(13,931)///(13,931)/

1,828,817/

1,355,354

/

-

/

-

-

¥-

¥/

¥-

¥-

Additional Tier 1 capital: regulatory adjustments
37
38

Investments in own additional Tier 1
instruments
Reciprocal cross-holdings in additional Tier 1
instruments

252

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(a) Composition of Capital Disclosure (International Standard)-(Continued)
As of March 31, 2018

(Millions of yen)
As of March 31, 2017

Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangements

Basel III
template

39

40

Investments in the capital of banking, financial
and insurance entities that are outside thescope of regulatory consolidation, net of
eligible short positions, where the bank does
not own more than 10% of the issued commonshare capital of the entity (amount above 10%threshold)
Significant investments in the capital ofbanking, financial and insurance entities thatare outside the scope of regulatory
consolidation (net of eligible short positions)
Total of items included in additional Tier 1
capital: regulatory adjustments subject tophase-out arrangements

¥121

¥/

¥38

¥9

73,500/117,600

29,400//27,858///

14,954///

11,717

/

/

/

13

/

/

/

1,172

/

-

/

-

/

73,621/

145,496/(F)

1,755,195/

1,209,858/(G)

9,192,244/

8,211,522

/

-

/

-

/

¥-

¥/

¥-

¥/

of which: goodwill equivalent

42
43

of which: intangible fixed assets recognized
as a result of a mergerof which: capital increase due tosecuritization transactionsof which: 50% of excess of expected losses
relative to eligible reserves by banks
adopting internal ratings-based approach
Regulatory adjustments applied to additional
Tier 1 due to insufficient Tier 2 to coverdeductions
Additional Tier 1 capital: regulatory(E)
adjustments

Additional Tier 1 capital (AT1)44

Additional Tier 1 capital ((D)-(E))

Tier 1 capital (T1 = CET1 + AT1)
45

Tier 1 capital (T1 = CET1 + AT1)((C)+(F))

Tier 2 capital: instruments and provisions (4)46
46

Directly issued qualifying Tier 2 instruments
plus related stock surplus of which: classified
as equity under applicable accounting
standards and the breakdown
Subscription rights to Tier 2 instruments

253

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As of March 31, 2018

(Millions of yen)
As of March 31, 2017

Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangements

Basel III
template

46

46

48-49

47+49
47
49

Directly issued qualifying Tier 2 instruments
plus related stock surplus of which: classified
as liabilities under applicable accounting
standards
Tier 2 instruments plus related stock surplus
issued by special purpose vehicles and otherequivalent entities
Tier 2 instruments issued by subsidiaries andheld by third parties (amount allowed in group
Tier 2)
Eligible Tier 2 capital instruments subject tophase-out arrangements included in Tier 2:
instruments and provisionsof which: directly issued capital instruments
subject to phase out from Tier 2of which: instruments issued by subsidiaries
subject to phase out¥828,702¥/¥684,150¥/

159,405/

168,300/

10,378/

10,574/

674,824/

842,133/

135,135/

168,022/539,688/674,110/50

Total of general allowance for loan losses andeligible provisions included in Tier 2

4,794

/

6,510

/

50a

of which: general allowance for loan losses

4,794

/

6,510

/

-

/

-

/

/

/

180,319///

161,221///

19,097/

1,678,105/

1,891,987

/

1,892

/

409

102

-

/

-

-

¥8,016¥/¥16,413¥4,10350bof which: eligible provisions
Total of items included in Tier 2 capital:
instruments and provisions subject to phaseout arrangementsof which: 45% of unrealized gains on othersecuritiesof which: 45% of revaluation reserve for land

51

Tier 2 capital: instruments andprovisions(H)

Tier 2 capital: regulatory adjustments
52

Investments in own Tier 2 instruments

53

Reciprocal cross-holdings in Tier 2 instruments
Investments in the capital of banking, financial
and insurance entities that are outside thescope of regulatory consolidation, net of
eligible short positions, where the bank does
not own more than 10% of the issued commonshare capital of the entity (amount above the
10% threshold)

54

254

Composition of capital disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(a) Composition of Capital Disclosure (International Standard)-(Continued)
As of March 31, 2018

(Millions of yen)
As of March 31, 2017

Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangements

Basel III
template

55

57

Significant investments in the capital banking,financial and insurance entities that are outside
the scope of regulatory consolidation (net of
eligible short positions)
Total of items included in Tier 2 capital:
regulatory adjustments subject to phase-out
arrangementsof which: investments in the capitalbanking, financial and insurance entitiesof which: 50% of excess of expected losses
relative to eligible reserves by banks
adopting internal ratings-based approach
Tier 2 capital: regulatory adjustments

¥-

¥/

¥-

¥-

/

/

35,732///

34,559

/

/

/

1,172

/

(I)

9,908

/

52,555/(J)

1,668,196/

1,839,431/(K)

10,860,440/

10,050,953

/

/

/

260,992///

123,310

/

/

/

9,150

/

/

/

110,789///

17,742/¥59,528,983¥/¥61,717,158¥/

12.49%/

11.34%/

Tier 2 capital (T2)58

Tier 2 capital (T2) ((H)-(I))

Total capital (TC = T1 + T2)
59

Total capital (TC = T1 + T2) ((G)+(J))

Risk weighted assets (5)Total of items included in risk weighted assets
subject to phase-out arrangementsof which: intangible assets (net of related
tax liability, excluding those relating tomortgage servicing rights)
of which: deferred tax assets that rely on
future profitability excluding those arisingfrom temporary differences (net of related
tax liability)of which: net defined benefit assetof which: investments in the capitalbanking, financial and insurance entities
60

Risk weighted assets(L)

Capital ratio (consolidated)
61

Common equity Tier 1 capital ratio(consolidated) ((C)/(L))

255

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As of March 31, 2018

(Millions of yen)
As of March 31, 2017

Amounts
excludedundertransitionalarrangements

Amounts
excludedundertransitionalarrangements

Basel III
template
62

Tier 1 capital ratio (consolidated) ((G)/(L))

15.44%/

13.30%/

63

Total capital ratio (consolidated) ((K)/(L))

18.24%/

16.28%/¥745,717¥/¥703,872¥/

142,407/

118,358

/

-

/

-

/

185,172/

182,672

/

4,794

/

6,510

/

43,678/46,343

/

-

/

-

/

284,521/299,309/833,255/

1,041,569

/

-

/

-

/

674,824/

843,530/¥7,304¥/¥-¥/

Regulatory adjustments (6)
72

73
74
75

Non-significant investments in the capital ofother financials that are below the thresholds
for deduction (before risk weighting)Significant investments in the common stock offinancials that are below the thresholds fordeduction (before risk weighting)Mortgage servicing rights that are below thethresholds for deduction (before risk weighting)Deferred tax assets arising from temporary
differences that are below the thresholds fordeduction (before risk weighting)

Provisions included in Tier 2 capital: instruments and provisions (7)
76
77

78

79

Provisions (general allowance for loan losses)
Cap on inclusion of provisions (generalallowance for loan losses)
Provisions eligible for inclusion in Tier 2 inrespect of exposures subject to internal ratingsbased approach (prior to application of cap) (ifthe amount is negative, report as "nil")
Cap for inclusion of provisions in Tier 2 underinternal ratings-based approach

Capital instruments subject to phase-out arrangements (8)
82
83
84
85

Current cap on AT1 instruments subject tophase-out arrangements
Amount excluded from AT1 due to cap (excess
over cap after redemptions and maturities) (ifthe amount is negative, report as "nil")
Current cap on T2 instruments subject tophase-out arrangements
Amount excluded from T2 due to cap (excess
over cap after redemptions and maturities) (ifthe amount is negative, report as "nil")

Notes: 1. The above figures are calculated based on the international standard applied on a consolidated basis under the FSA Notice No. 20.
2. In calculating the consolidated capital adequacy ratio, we underwent an examination following the procedures agreed with Ernst & Young ShinNihon LLC, on the basis of"Treatment in implementing examination by agreed-upon procedures for calculating capital adequacy ratio" (Industry Committee Practical Guideline No. 30 of the JapaneseInstitute of Certified Public Accountants). Note that this is not a part of the accounting audit performed on our consolidated financial statements. This consists of an
examination under agreed-upon procedures performed by Ernst & Young ShinNihon LLC on a portion of the internal control structure concerning the calculation of thecapital adequacy ratio and a report of the results to us. As such, they do not represent an opinion regarding the capital adequacy ratio itself nor the internal controls related
to the calculation of the capital adequacy ratio.

256

Composition of capital disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(b) Explanation of (a) Composition of Capital Disclosure
Reconciliation between "Consolidated balance sheet" and items of consolidated balance sheet and "Composition of capital
disclosure"(Millions of yen)

Items

(Assets)
Cash and due from banks
Call loans and bills purchased
Receivables under resaleagreements
Guarantee deposits paid under
securities borrowing transactions
Other debt purchased
Trading assets
Money held in trust
Securities
Loans and bills discounted
Foreign exchange assets
Derivatives other than for trading
assetsOther assets
Tangible fixed assets
Intangible fixed assets
Net defined benefit asset
Deferred tax assets
Customers' liabilities for acceptancesand guarantees
Reserves for possible losses on
loans
Total assets(Liabilities)
Deposits
Negotiable certificates of deposit
Call money and bills soldPayables under repurchaseagreements
Guarantee deposits received under
securities lending transactions
Commercial paper
Trading liabilities
Borrowed money
Foreign exchange liabilities
Short-term bonds
Bonds and notes

257

Explanation of Composition of capital disclosure

Consolidated balance sheet as in publishedfinancial statements

Cross-reference
to Appended
template

As of March 31, 2018

As of March 31, 2017¥47,725,360
715,149¥47,129,583
1,035,746

8,080,873

8,967,777

4,350,527

3,350,051

2,713,742
10,507,133
337,429
34,183,033
79,421,473
1,941,677

2,745,204
10,361,787
247,583
32,353,158
78,337,793
1,828,782

1,807,999

2,170,750

6-d

4,588,484
1,111,128
1,092,708
996,173
47,8394,180,339
1,136,329
1,045,486
797,762
56,0666-e

5,723,186

5,273,581(315,621)(509,175)¥205,028,300¥200,508,610¥125,081,233
11,382,590
2,105,293¥120,045,217
10,631,277
1,255,172

16,656,828

17,969,753

1,566,833

1,679,300

710,391
8,121,543
4,896,218
445,804
362,1857,544,256

789,705
7,923,285
6,307,230
526,053
226,348
7,564,535

6-a2-b, 6-b
6-c

2-a
3
4-a

6-f
8-a

8-b

Reference # ofBasel III template
under theComposition ofcapital disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(b) Explanation of (a) Composition of Capital Disclosure-(Continued)(Millions of yen)Items

Due to trust accounts
Derivatives other than for trading
liabilities
Other liabilities
Reserve for bonus payments
Reserve for variable compensation
Net defined benefit liability
Reserve for director and corporate
auditor retirement benefits
Reserve for possible losses on salesof loans
Reserve for contingencies
Reserve for reimbursement ofdeposits
Reserve for reimbursement ofdebentures
Reserves under special laws
Deferred tax liabilities
Deferred tax liabilities for revaluation
reserve for land
Acceptances and guarantees
Total liabilities(Net assets)
Common stock and preferred stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders' equity
Net unrealized gains (losses) onother securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation
adjustments
Remeasurements of defined benefit
plans
Total accumulated othercomprehensive income
Stock acquisition rights
Non-Controlling interests
Total net assets
Total liabilities and net assets

Consolidated balance sheet as in publishedfinancial statements

Cross-reference
to Appended
template

As of March 31, 2018

As of March 31, 2017

¥4,733,131¥4,784,077

1,514,483

1,784,857

3,685,585
66,872
3,242
58,8903,883,168
67,633
3,018
55,236

1,460

1,327

1,075

298

5,622

5,680

20,011

19,07230,76032,7202,361
421,0022,309
337,800

4-b

66,186

66,5854-c

5,723,186¥195,207,054

5,273,581¥191,235,249

2,256,548
1,134,922
4,002,835(5,997)¥7,388,309

2,256,275
1,134,416
3,615,449(4,849)¥7,001,291

1,392,392

1,289,985(67,578)
144,277

10,172
145,609(85,094)(69,657)

293,536

144,866¥1,677,534¥1,520,976

1,163
754,239¥9,821,246¥205,028,300

1,754
749,339¥9,273,361¥200,508,610

Reference # ofBasel III template
under theComposition ofcapital disclosure

6-g

1-a
1-b
1-c
1-d

5

3
1b
7

Note: The regulatory scope of consolidation is the same as the accounting scope of consolidation.

258

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

Appended template
1. Shareholders' Equity(1) Consolidated Balance Sheet(Millions of yen)

Consolidated balance sheet items

As of March
31, 2018

As of March
31, 2017

1-a Common stock and preferred stock
1-b Capital surplus
1-c Retained earnings
1-d Treasury stock
Total shareholders' equity¥2,256,548
1,134,922
4,002,835(5,997)¥7,388,309¥2,256,275
1,134,416
3,615,449(4,849)¥7,001,291

Ref.

(2) Composition of CapitalBasel III
template

Composition of capital disclosure

Directly issued qualifying commonshare capital plus related stock
surplus and retained earnings
1a
2
1c

31a

of which: capital and stock surplusof which: retained earningsof which: treasury stock (-)
of which: other than above
Directly issued qualifying additional
Tier 1 instruments plus related stock
surplus of which: classified as equity
under applicable accounting standards
and the breakdown

259

Explanation of Composition of capital disclosure

Remarks(Millions of yen)
As of March
31, 2017

Remarks¥7,387,824¥7,000,683

Shareholders' equity
attributable to common shares(before adjusting national
specific regulatory adjustments(earnings to be distributed))

3,391,471
4,002,350
5,997-

3,390,691
3,614,841
4,849
-

-

-

As of March
31, 2018

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

2. Intangible Fixed Assets(1) Consolidated Balance Sheet(Millions of yen)
As of March
31, 2018

As of March
31, 2017

Ref.

Consolidated balance sheet items

2-a
2-b

Intangible fixed assets
Securitiesof which: share of goodwill ofcompanies accounted for using theequity method¥1,092,708
34,183,033¥1,045,486
32,353,158

14,58824,846

Income taxes related to above¥(312,342)¥(295,574)(2) Composition of CapitalBasel III
template

Composition of capital disclosure

Goodwill (net of related tax liability,
including those equivalent)
Other intangibles other than goodwill
9 and mortgage servicing rights (net of
related tax liability)
Mortgage servicing rights (net of
related tax liability)
Amount exceeding the 10%
20
threshold on specified items
Amount exceeding the 15%
24
threshold on specified items
Mortgage servicing rights that are74
below the thresholds for deduction(before risk weighting)8

Consolidated balance sheet items

3 Net defined benefit asset
Income taxes related to above

As of March
31, 2017¥85,103¥99,619

709,850

675,139

-

-

-

-

-

-

-

-

15

Remarks

Software and other(Millions of yen)
As of March
31, 2018

As of March
31, 2017¥996,173¥797,762¥(304,793)¥(243,814)(2) Composition of CapitalBasel III
template

Share of goodwill of companies
accounted for using the equity
method(Millions of yen)
As of March
31, 2018

3. Net defined Benefit Asset(1) Consolidated Balance Sheet
Ref.

Remarks

Remarks(Millions of yen)

Composition of capital disclosure

As of March
31, 2018

As of March
31, 2017

Net defined benefit asset¥691,380¥553,947

Remarks

260

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

4. Deferred Tax Assets(1) Consolidated Balance Sheet(Millions of yen)
As of March
31, 2018

As of March
31, 2017

Ref.

Consolidated balance sheet items

4-a
4-b

Deferred tax assets
Deferred tax liabilities
Deferred tax liabilities for revaluation
reserve for land

¥47,839
421,002¥56,066
337,800

66,186

66,585

Tax effects on intangible fixed assets
Tax effects on net defined benefit asset¥312,342
304,793¥295,574
243,8144-c(2) Composition of CapitalBasel III
template

10

21
25

75

Composition of capital disclosure(Millions of yen)
As of March
31, 2018

As of March
31, 2017

Deferred tax assets that rely on future
profitability excluding those arisingfrom temporary differences (net of
related tax liability)¥42,352¥45,751

Deferred tax assets that rely on future
profitability arising from temporary
differences (net of related tax liability)

185,172

182,672

-

-

-

-

185,172

182,672

Amount exceeding the 10%threshold on specified items
Amount exceeding the 15%threshold on specified items
Deferred tax assets arising from
temporary differences that are
below the thresholds for deduction(before risk weighting)

261

Explanation of Composition of capital disclosure

Remarks

Remarks

This item does not agree withthe amount reported on the
consolidated balance sheet
due to offsetting of assets andliabilities.
This item does not agree withthe amount reported on the
consolidated balance sheet
due to offsetting of assets andliabilities.

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

5. Deferred Gains or Losses on Derivatives under Hedge Accounting(Millions of yen)
(1) Consolidated Balance Sheet
Ref.

5

Consolidated balance sheet items

As of March
31, 2018

As of March
31, 2017

Deferred gains or losses on hedges¥(67,578)¥10,172(2) Composition of CapitalBasel III
template

11

Remarks(Millions of yen)

Composition of capital disclosure

As of March
31, 2018

As of March
31, 2017

Deferred gains or losses onderivatives under hedge accounting¥(67,578)¥10,172

Remarks

6. Items Associated with Investments in the Capital of Financial Institutions(Millions of yen)
(1) Consolidated Balance Sheet
As of March
31, 2018

As of March
31, 2017¥10,507,133¥10,361,787

6-b Securities
6-c Loans and bills discounted
Derivatives other than for trading
6-dassets6-e Other assets

34,183,033
79,421,473

32,353,158
78,337,793

1,807,999

2,170,750

4,588,484

4,180,339

6-fTrading liabilities

8,121,543

7,923,2856-gDerivatives other than for trading
liabilities

1,514,483

1,784,857

Ref.

Consolidated balance sheet items

6-a

Trading assets

Remarks

Including trading accountsecurities and derivatives for
trading assets
Including subordinated loans

Including money invested
Including trading accountsecurities sold

262

Explanation of Composition of capital disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(2) Composition of CapitalBasel III
template

16
37
52

17
38
53

18
39
54
72

19
23
40
55
73

Composition of capital disclosure

Investments in own capital instruments
Common equity Tier 1 capital
Additional Tier 1 capital
Tier 2 capital
Reciprocal cross-holdings in thecapital of banking, financial andinsurance entities
Common equity Tier 1 capital
Additional Tier 1 capital
Tier 2 capital
Investments in the capital of banking,financial and insurance entities thatare outside the scope of regulatory
consolidation, net of eligible shortpositions, where the bank does not
own more than 10% of the issued
share capital (amount above 10%threshold)Common equity Tier 1 capital
Additional Tier 1 capital
Tier 2 capitalNon-significant investments in thecapital of other financials that are
below the thresholds for deduction(before risk weighting)Significant investments in the capitalof banking, financial and insurance
entities that are outside the scope of
regulatory consolidation, net of eligible
short positions
Amount exceeding the 10%threshold on specified items
Amount exceeding the 15%threshold on specified items
Additional Tier 1 capital
Tier 2 capitalSignificant investments in thecommon stock of financials that are
below the thresholds for deduction(before risk weighting)

263

Explanation of Composition of capital disclosure(Millions of yen)
As of March
31, 2018

As of March
31, 2017¥3,3491,457
1,892¥7,353
6,842
511

-

-

-

-

773,996

770,182

20,140121
8,016

45,74348
20,517745,717703,872

215,907265,358

-

-

-

-

73,500-147,000-

142,407

118,358

Remarks

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

7. Non-Controlling Interests(1) Consolidated Balance Sheet
Ref.

7(Millions of yen)

Consolidated balance sheet items

As of March
31, 2018

As of March
31, 2017

Non-Controlling interests¥754,239¥749,339(2) Composition of CapitalBasel III
template

Composition of capital disclosure

Common share capital issued by
5 subsidiaries and held by third parties(amount allowed in group CET1)
Qualifying additional Tier 1
instruments plus related stock surplus
30-31ab-32
issued by special purpose vehicles
and other equivalent entities
Additional Tier 1 instruments issued by
34-35 subsidiaries and held by third parties(amount allowed in group AT1)
Tier 2 instruments plus related stock
46 surplus issued by special purpose
vehicles and other equivalent entities
Tier 2 instruments issued by
48-49 subsidiaries and held by third parties(amount allowed in group Tier 2)(Millions of yen)
As of March
31, 2018

As of March
31, 2017¥14,344¥14,537

After reflecting amounts eligible
for inclusion (non-controllinginterest after adjustments)--

After reflecting amounts eligible
for inclusion (non-controllinginterest after adjustments)

31,317

31,786

159,405

168,300

10,378

10,5748. Other Capital Instruments(1) Consolidated Balance Sheet
Ref.

Consolidated balance sheet items

8-a
8-b

Borrowed money
Bonds and notes
Total

Remarks

Remarks

After reflecting amounts eligible
for inclusion (non-controllinginterest after adjustments)
After reflecting amounts eligible
for inclusion (non-controllinginterest after adjustments)
After reflecting amounts eligible
for inclusion (non-controllinginterest after adjustments)(Millions of yen)
As of March
31, 2018

As of March
31, 2017¥4,896,218
7,544,256¥12,440,475¥6,307,230
7,564,535¥13,871,765

Remarks264

Explanation of Composition of capital disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(2) Composition of CapitalBasel III
template

Composition of capital disclosure

Directly issued qualifying additional
Tier 1 instruments plus related stock
32 surplus of which: classified asliabilities under applicable accounting
standards
Directly issued qualifying Tier 2
instruments plus related stock surplus
46
of which: classified as liabilities underapplicable accounting standards(Millions of yen)
As of March
31, 2018

As of March
31, 2017¥1,220,000¥760,000

828,702684,150

Remarks

Note: Amounts as of March 31, 2017 in the "Composition of capital disclosure" are based on those before considering amounts under transitional arrangements and include "Amounts
excluded under transitional arrangements" disclosed in "(A) Composition of Capital Disclosure" as well as amounts included as regulatory capital. In addition, items forregulatory purposes under transitional arrangements are excluded from this table.

265

Explanation of Composition of capital disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）■ Summary of Risk Management and Risk-weighted Assets (RWA)(1) Summary of Our Group’s Risk Profile, Risk Management Policies/ Procedures and Structure
See pages 79 to 84 for a summary of our group’s risk profile and risk management policies, etc.
(2) Summary of RWA(A) OV1: Overview of Risk-weighted Assets (RWA)(Millions of yen)aBasel III
Template
No.

1

b

c

RWA

Credit risk (excluding counterparty credit risk)

As of March
31, 2018¥38,823,030

dcapital requirements

As of March
31, 2017/

As of March
31, 2018¥3,275,858

As of March
31, 2017/

2

Of which: standardized approach (SA)1,820,063/

145,605/

3

Of which: internal rating-based (IRB) approach

35,420,038/

3,003,619

/

-

/

-

/

-

/

-

/

1,582,929/

126,634/

4,531,171/

366,994

/

-

/

-

/

Of which: current exposure method

216,424/

17,723/

Of which: expected positive exposure (EPE) method

887,843/

74,632/2,539,780/

203,182/

193,088/

15,447/

Of which: significant investments
Of which: estimated residual value of leasetransaction
Others45
6Counterparty credit risk (CCR)
Of which: SA-CCR

Of which: credit valuation adjustment (CVA) risk
Of which: central counterparty-related

7

OthersEquity positions in banking book under marketbased approach
Fund exposures - standardized approach

694,035/

56,009/2,972,073/

252,031

/

-

/

-

/

Fund exposures - regarded method

3,515,582/

297,289

/

4,574

/

386

/

379,016/

32,003/

110,551

/

9,374

/

231,492/

19,630/25,711

/

2,056

/

11

Settlement risk

12

Securitization exposures in banking book
Of which: IRB ratings-based approach (RBA) or IRB
internal assessment approach (IAA)
Of which: IRB supervisory formula approach (SFA)
Of which: SA/simplified supervisory formula approach(SSFA)Of which: 1250% risk weight is applied

13
14
15

16

Market risk

11,261/941/

2,470,321/

197,625/

17

Of which: standardized approach (SA)1,406,398/

112,511/18

Of which: internal model approaches (IMA)

1,063,922/

85,113/3,411,289/

272,903/591,083/

47,286/19

Operational risk

20

Of which: basic indicator approach21

Of which: standardized approach

22

24

Of which: advanced measurement approach
Exposures of specified items not subject toregulatory adjustments
Amounts included in RWA subject to phase-out
arrangements
Floor adjustment

25

Total (after applying the scaling factor)

23

-

/

-

/

2,820,206/

225,616/

818,950/

67,224

/

-

/

-

/

-

/

-

/

¥59,528,983/¥4,762,318/

Note:We disclose the data for the fiscal year ended March 31, 2018 according to the New FSA Notice.

266

Overview of RWA

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(B) Credit Risk Weighted Assets by Asset Class and Ratings Segment(Billions of yen)
As of March 31, 2018

Internal ratings-based approach
Corporate, etc.
Corporate (except specialized
lending)
Ratings A1-B2
Ratings C1-D3
Ratings E1-E2
Ratings E2R-H1
Sovereign
Ratings A1-B2
Ratings C1-D3
Ratings E1-E2
Ratings E2R-H1Bank
Ratings A1-B2
Ratings C1-D3
Ratings E1-E2
Ratings E2R-H1
Specialized lending
RetailResidential mortgage
Qualifying revolving loan
Other retail
Equities
PD/LGD approach
Market-based approach
Regarded-method exposure
Securitizations
OthersStandardized approach
CVA risk
Central counterparty-related
Total

EAD
¥188,162.7
162,853.7

RWA¥47,619.7
29,536.1

Risk
Weight(%)
25.30
18.13

EAD
¥189,852.0
164,623.5

RWA¥50,084.2
31,312.3

Risk
Weight(%)
26.38
19.02

79,917.9

27,232.1

34.07

78,222.1

28,727.3

36.72

58,776.0
19,376.2
1,182.2
583.3
76,803.1
76,674.5
128.2
0.3
0.0
5,986.3
5,447.4
537.5
0.0
1.2
146.3
11,629.8
9,046.0
673.7
1,910.0
5,136.2
4,162.6
973.5
2,102.9
4,169.4
2,270.5
18,603.6//¥206,766.4

13,840.5
11,569.6
1,625.0
196.7
833.9
758.3
75.2
0.2
0.0
1,313.1
1,002.1
310.5
0.0
0.3
156.9
3,818.0
2,508.1
513.0
796.8
8,436.2
5,279.2
3,157.0
3,716.1
371.5
1,741.5
3,294.7
2,539.7
193.0¥53,647.3

23.54
59.71
137.45
33.73
1.08
0.98
58.70
82.31
39.56
21.93
18.39
57.77
129.81
29.94
107.22
32.83
27.72
76.14
41.72
164.25126.82324.26
176.70
8.91
76.70
17.71
/
/
25.94

55,538.0
20,306.6
1,373.3
1,004.080,314.2
80,165.1
148.6
0.3
0.0
5,921.5
5,337.6
582.4
0.0
1.4
165.6
12,235.5
9,388.0
629.2
2,218.2
4,973.3
4,180.1
793.1
1,744.0
4,009.5
2,265.9
17,523.9//¥207,375.9

14,486.4
12,002.9
1,885.3
352.5
1,023.3
928.3
94.3
0.6
0.0
1,375.8
1,036.1
339.2
0.0
0.4
185.8
4,541.9
3,096.3
415.6
1,029.9
8,642.9
6,068.0
2,574.9
3,341.4
328.9
1,916.6
3,508.0
2,272.3
195.4¥56,060.0

26.08
59.10
137.27
35.11
1.27
1.15
63.49
164.61
40.50
23.23
19.41
58.25
184.0429.54
112.16
37.12
32.98
66.05
46.42
173.78145.16324.64
191.58
8.20
84.58
20.01
/
/
27.03

Note: "Specialized lending" is specialized lending exposure under supervisory slotting criteria.

267

RWA by asset class and ratings segment

As of March 31, 2017

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）■ Linkages between Financial Statements and Regulatory Exposures(A) LI1: Differences between Accounting and Regulatory Scopes of Consolidation and Mapping of Financial
Statement Categories with Regulatory Risk Categories(Millions of yen)a

AssetsCash and Due from Banks
Call Loans and Bills Purchased
Receivables under Resale Agreements
Guarantee Deposits Paid under
Securities Borrowing Transactions
Other Debt Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Derivatives Other than for Trading
AssetsOther Assets
Tangible Fixed Assets
Intangible Fixed Assets
Net Defined Benefit AssetDeferred Tax Assets
Customers' Liabilities for
Acceptances and Guarantees
Reserves for Possible Losses on Loans
Total assetsb

As of March 31, 2018def
Carrying values of items:cCarrying
Carrying
values as
valuesreported inunderpublished scope offinancial regulatory
statements consolidation

Subject tocreditrisk
framework¥47,725,360
715,149
8,080,873¥47,725,360
715,149-¥8,080,873

4,350,527-

2,713,742
10,507,133
337,429
34,183,033
79,421,473
1,941,677

2,127,247
337,429
32,788,339
77,937,924
1,941,677

1,807,999gSubject tothe market
risk
framework

Not subject tocapitalrequirements
or subject todeductionfrom capital

¥-

¥-

¥-

4,350,527---

5,318,732
1,305-

551,092
1,287,391
1,475,430-

10,507,133-

35,402
2,249
107,303
6,812--

1,807,999---

4,588,484
1,111,128
1,092,708
996,173
47,8391,549,959
1,111,128
312,342304,793
5,487

1,936,112
-

4,161
-

-

1,098,251
780,365
691,380
42,352

5,723,186

5,722,952

234

-

-

-

(315,621)¥205,028,300(314,330)¥172,265,461¥21,495,785¥3,318,075¥10,507,133(1,291)¥2,762,827

Subject tocounterparty Subject to thecredit risk securitization
framework
framework

268

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

LI1-(Continued)(Millions of yen)ab

Carrying
values as
Carrying
reported in values underpublished scope offinancial regulatory
statements consolidation
Liabilities
Deposits
Negotiable Certificates of Deposit
Call Money and Bills Sold
Payables under Repurchase
Agreements
Guarantee Deposits Received under
Securities Lending Transactions
Commercial Paper
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Short-term Bonds
Bonds and Notes
Due to Trust Accounts
Derivatives other than for trading
liabilities
Other Liabilities
Reserve for Bonus Payments
Reserve for variable compensation
Net Defined Benefit Liability
Reserve for Director and Corporate
Auditor Retirement Benefits
Reserve for possible losses onsales of loans
Reserve for contingencies
Reserve for reimbursement of deposits
Reserve for reimbursement ofdebentures
Reserves under Special Laws
Deferred Tax Liabilities
Deferred Tax Liabilities for
Revaluation Reserve for Land
Acceptances and Guarantees
Total liabilities

As of March 31, 2018def
Carrying values of items:cSubject tocreditrisk
framework

Subject tocounterparty Subject to thecredit risk securitization
framework
frameworkg
Not subject tocapitalrequirements
or subject todeductionfrom capital

Subject tothe market
risk
framework¥125,081,233
11,382,590
2,105,293

¥-

¥-

¥-

¥- ¥125,081,233
11,382,590
2,105,293

16,656,828-

16,656,828--

1,566,833-

1,566,833---

710,391
8,121,543
4,896,218
445,804
362,1857,544,256
4,733,131-

4,936,441--

8,121,543-

710,391
4,896,218
445,804
362,1857,544,256
4,733,131

1,514,483-

1,514,483---

3,685,585
66,872
3,242
58,890-76,599---3,608,986
66,872
3,242
58,890

1,460

-

-

-

-

1,460

1,075

-

-

-

-

1,075

5,622
20,011

56
-

-

-

-

5,566
20,011

30,760----30,7602,361
421,002

-

-

-

-

2,361
421,002

66,186----

66,186

5,723,186¥195,207,054¥56¥24,751,187¥-

5,723,186¥8,121,543 ¥167,270,708

Notes: 1. Since the scope of accounting consolidation and that of regulatory consolidation are the same, the column (a) and (b) have been combined.
2. Market risk includes foreign exchange risk and commodities risk in the banking book, but only those items in the trading book are recorded.

269

Linkages between Financial Statements and Regulatory Exposures-2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(B) LI2: Main Sources of Differences between Regulatory Exposure Amounts and Carrying Values in Financial
Statements(Millions of yen)

a

Total
1
2
3
4
5
6
7
8
9

Asset carrying value amount under scope of
regulatory consolidation (as per template LI1)
Liabilities carrying value amount under regulatory
scope of consolidation (as per template LI1)
Total net amount under regulatory scope of consolidation
Off-balance sheet amounts
Differences due to consideration of provision forloan losses and write-offs
Differences due to derivative transactions, etc.
Differences due to repurchase transactions
Other differences
Exposure amounts considered for regulatory purposes

As of March 31, 2018bcde
Items subject to:Counterparty
credit risk Securitization Market risk
Credit risk
framework
framework
framework
framework¥202,265,473¥172,265,461¥21,495,785¥3,318,075¥10,507,133

27,936,345

56

24,751,187-

8,121,543

174,329,127
17,311,153

172,265,405
16,446,822(3,255,401)-

3,318,075
864,3312,385,589-

401,252

401,252---

1,887,980
17,310,011(523,103)¥210,716,420(907,644)¥188,205,836

1,887,980
17,310,011¥15,942,589¥4,182,406¥2,385,589

Notes: 1. Column (a) is not necessarily equal to the sum of columns (b) to (e) due to assets being riskweighted more than once.
2. Differences between regulatory exposure amounts and carrying values in consolidated financial statements and the main sources of the differences are as follows.
･ Off-balance sheet amounts correspond to the differences produced mainly by adding exposures to undrawn commitments and by multiplying customer liabilities for
acceptances and guarantees by the credit conversion factor (CCF) assigned to off-balance sheet items under the regulatory capital requirements.
･ Differences due to consideration of provision for loan losses, and write-offs are produced mainly by adding general provisions for loan losses, specific provisions for loan
losses and partial direct bad debt write-offs to those assets subject to the advanced internal ratings-based approach.
･ Differences due to derivative transactions, etc. are produced mainly by incorporating future market value fluctuations and the effect of netting into regulatory exposureamounts. Derivative transactions, etc. include long-settlement transactions.
･ Differences due to repurchase transactions are mainly produced by adding the exposure amounts related to assets pledged as collateral and considering the effect of
netting and collateral.
･ Other differences are produced mainly by considering the offsetting of deferred tax assets against deferred tax liabilities and the regulatory recognized effectiveness ofhedging and making regulatory prudential adjustments.

270

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy■ Credit Risk
(1) Summary of Risk Profile, Risk Management Policies/ Procedures and Structure
See pages 113 to 116 for a summary of our credit risk profile and credit risk management policies, etc.
(2) Summary of Provision for Loan Losses and Write-offs
See page 115 for a summary of provision for loan losses and write-offs.
(3) Quantitative Disclosure on Credit Risk
Counterparty credit risk exposures, securitization exposures, and regarded-method exposures are excluded from theamount of credit risk exposures below.
(A) CR1: Credit Quality of Assets(Millions of yen)

As of March 31, 2018abcGross carrying values of
NonDefaulted
defaulted
exposures
exposures
Reserve
1
2
3
4
5
6
7
8

On-balance sheet exposures
Loans
Debt securities
Other on-balance sheet debt exposures
Total on-balance sheet exposures (1+2+3)
Off-balance sheet exposures
Guarantees
Commitments
Total off-balance sheet exposures (5+6)
Total
Total assets (4+7)

dNet values(a+b-c)¥645,060
5,946
2,652
653,659¥77,305,616
26,116,905
51,697,897
155,120,419¥271,369
2,526
273,896¥77,679,307
26,122,851
51,698,023
155,500,182

13,776
15,24929,026

5,709,421
25,189,759
30,899,180

30,81930,8195,692,378
25,205,009
30,897,388¥682,685 ¥186,019,600¥304,715 ¥186,397,570

Notes: 1. Other on-balance sheet debt exposures include deposits, call loans, bills purchased, other debt purchased, money held in trust and foreign exchange assets, etc.
2. Defaulted exposures include restructured loans, loans past due for three months or more, loans to bankrupt borrowers and so on.
3. Reserve corresponds to the amount of reserves for possible loan losses(B) Breakdown of Credit Risk Exposures(a) Breakdown by Geographical Area

(Billions of yen)

As of March 31, 2018

Domestic
Overseas
Asia
Central and South America
North America
Eastern Europe
Western Europe
Other areas
Total
Standardized approach portion

Loans,
commitments
and other
non-derivative
off-balance-sheet
exposures¥62,042.2
39,785.8
10,263.4
2,947.5
14,172.5
346.0
7,876.3
4,179.8¥101,828.0/

Securities¥21,449.0
9,122.3
1,961.2
52.0
5,074.6
1,313.7
720.5¥30,571.3/

Others¥37,376.2
10,527.5
1,947.9
1,136.3
5,917.4
10.0
844.5
671.1
¥47,903.8/

Total¥120,867.5
59,435.7
14,172.7
4,135.9
25,164.6
356.1
10,034.6
5,571.5¥180,303.2
16,604.4

Notes: 1. Standardized approach portion represents the amount calculated using the standardized approach for business units and asset classes that are immaterial for the purposeof calculating credit RWA
2. Exposure to non-Japanese residents is included in Overseas.
3. Others include cash, deposits, call loans, other debt purchased, money held in trust, foreign exchange assets and other assets, etc.

271

Credit Risk、Quantitative Disclosure on Credit Risk

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(b) Breakdown by Industry(Billions of yen)

As of March 31, 2018

Manufacturing
Construction
Real estate
Service industries
Wholesale and retail
Finance and insurance
Individuals
Other industries
Japanese Government; Bank of Japan
Total
Standardized approach portion

Loans,
commitments
and other
non-derivative
off-balance-sheet
exposures¥22,348.0
1,834.4
9,576.2
5,455.8
9,536.2
13,028.8
12,145.6
25,827.4
2,075.1¥101,828.0/

Securities¥2,335.3
235.7
814.1
440.1
755.6
2,395.8
9.9
8,314.1
15,270.3¥30,571.3/

Others¥551.1
65.5
18.0
714.2
744.0
3,706.3
114.1
9,790.1
32,200.0¥47,903.8/

Total¥25,234.5
2,135.6
10,408.5
6,610.2
11,036.0
19,131.0
12,269.6
43,931.7
49,545.6¥180,303.2
16,604.4

Notes: 1. Standardized approach portion represents the amount calculated using the standardized approach for business units and asset classes that are immaterial for the purposeof calculating credit RWA.
2. Others include cash, deposits, call loans, other debt purchased, money held in trust, foreign exchange assets and other assets, etc.

(c) Breakdown by Residual Contractual Maturity(Billions of yen)

As of March 31, 2018

Less than one year
From one year to less than three years
From three years to less than five years
Five years or more
Other than above
Total
Standardized approach portion

Loans,
commitments
and other
non-derivative
off-balance-sheet
exposures¥30,139.5
22,692.1
20,637.6
27,872.8
485.8¥101,828.0/

Securities¥10,117.3
4,828.9
3,738.5
7,042.5
4,843.9¥30,571.3/

Others¥6,135.9
789.9
14.5
165.4
40,798.0¥47,903.8/

Total¥46,392.7
28,311.0
24,390.7
35,080.9
46,127.8¥180,303.2
16,604.4

Notes: 1. Standardized approach portion represents the amount calculated using the standardized approach for business units and asset classes that are immaterial for the purposeof calculating credit RWA
2. Others include cash, deposits, call loans, other debt purchased, money held in trust, foreign exchange assets and other assets, etc.

272

Quantitative Disclosure on Credit Risk

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(C) Exposure to Obligors Claims of Whom Meet the Stipulations in the Article 4 Paragraph 2, 3 or 4 of theOrdinance for Enforcement of the Act on Emergency Measures for the Revitalization of the Financial Functions
Enacted in Japan(a) Breakdown by Geographical Area

Domestic
Overseas
Asia
Central and South America
North America
Eastern Europe
Western Europe
Other areas
Total
Standardized approach portion(Billions of yen)

Exposure¥598.8
193.0
28.6
63.1
19.9
0.4
71.4
9.2
¥791.814.1

As of March 31, 2018
Reserve¥121.9
35.9
2.4
4.3
0.3
0.4
24.8
3.4
¥157.8
6.9

Write-offs
¥13.7
1.4
0.0
1.3
¥15.2
0.3

Note: Standardized approach portion represents the amount calculated using the standardized approach for business units and asset classes that are immaterial for the purpose of
calculating credit RWA(b) Breakdown by Industry(Billions of yen)

Manufacturing
Construction
Real estate
Service industries
Wholesale and retail
Finance and insurance
Individuals
Other industries
Total
Standardized approach portion

Exposure¥190.9
7.8
43.5
73.6
198.2
21.5
103.3
152.6
¥791.814.1

As of March 31, 2018
Reserve
¥50.4
0.8
1.8
12.9
55.0
1.9
12.3
22.4
¥157.8
6.9

Write-offs
¥2.8
0.1
0.2
1.9
5.7
3.3
0.8
¥15.2
0.3

Note: Standardized approach portion represents the amount calculated using the standardized approach for business units and asset classes that are immaterial for the purpose of
calculating credit RWA.

(D) Exposure by Past Due Period(Billions of yen)

As of March 31, 2018
From one month to less From two months to lessthan two months
than three months
Three months or more
Less than one month¥100.7
¥46.1
¥15.1
¥29.4

Total
¥191.5

Note: Excluding claims under bankruptcy or substantial bankruptcy stipulated in the Article 4 paragraph 2 of the Ordinance for Enforcement of the Act on Emergency Measures for
the Revitalization of the Financial Functions as well as high risk claims stipulated in the Article 4 paragraph 3.

(E) Exposure to Obligors Claims of Whom have been Restructured for the Purpose of Corporate Restructuring or
Supporting the Customer(Billions of yen)

As of March 31, 2018

Exposure¥322.7

Amount of exposure for which loss
reserve has increased as a result of
restructuring of lending terms¥280.6

Others¥42.0

Notes: Excluding claims under bankruptcy or substantial bankruptcy stipulated in the Article 4 paragraph 2 of the Ordinance for Enforcement of the Act on Emergency Measures for
the Revitalization of the Financial Functions, high risk claims stipulated in the Article 4 paragraph 3 or claims overdue for more than three months stipulated in the Article 4paragraph 4.

273

Quantitative Disclosure on Credit Risk

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(4) Credit Risk under Internal Ratings-Based (IRB) Approach(i) Summary of Internal Ratings-Based (IRB) Approach
We have adopted Advanced Internal Ratings-Based (AIRB) Approach as a method to calculate credit risk weighted
assets (RWA) since March 31, 2009. The following business units have adopted AIRB approach:Mizuho Financial Group, Inc., Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd., Mizuho Credit Guarantee Co., Ltd.,
Mizuho Trust Realty Company Limited, Mizuho Bank (China), Mizuho Bank (USA), Ltd., Mizuho Bank Europe N.V., andMizuho Capital Markets LLC.
Note: Special purpose companies (SPCs) controlled by the above companies have also adopted the AIRB approach due to theirbusiness operations integrated with their parent companies.

The application scope of AIRB is determined through taking into account the importance for each business unit, such as
the ratio of its credit RWA to that of the entire group. AIRB is generally applied to those assets held by the business
units that have adopted AIRB except for some asset classes considered immaterial for the purpose of calculating credit
RWA. In addition, AIRB is used for all equity exposures and credit RWA exposures under Regarded-Method regardlessof what approach the business unit has adopted. The standardized approach will be applied to any of those business
units and asset classes that do not meet the above conditions.
(ii) Summary of Our Internal Rating System
See pages 113 to 115 for a summary of our internal rating system and rating assignment procedures.

Estimation of parameters and validation
We use our own estimates for the parameters indicated below in the calculation of credit RWA under the Basel
Framework. We generally validate the parameters by backtesting or other methods on an annual basis. Methods of
estimation and validation as well as results are approved by the Chief Risk Officer.
Probability of default (likelihood of default of an obligor over a period of one year)
PD
LGD
Loss given default
EAD
Exposure at default
The definition of default conforms to the Notice issued by Japan’s Financial Services Agency.

Details of Estimates:
We estimate PD of corporate, sovereign and bank exposures per obligor rating, and that of retail exposures per pool
allocations. In making estimations, we make conservative adjustments such as accounting for estimation error on thelong-term average of internal default records. We supplement estimations for low default portfolios with external data.
We apply the regulatory floor PD (0.03%) to A1-rated obligors in the measurement of credit RWA, except for sovereign
exposures. The estimated parameters in almost all the PD categories such as obligor rating or pool allocations
exceeded actual defaults in the last three years. The differences stemmed from such reasons as: actual defaults in thelast few years were lower than the long-term average of the defaults over the entire period, which was the basis for ourestimation; conservative adjustments have been made to estimated parameters.
We estimate LGD based on obligor classifications in our self-assessments or pool allocations, and protection coverage.
For LGD per obligor classifications, we estimate LGD under normal economic circumstances based on prior defaulted
obligor data, making adjustments in consideration of periods of economic downturn using stochastic methods. Ourestimation is based on validation of the time between the default event and the closure of the exposure as well as LGD
for low default portfolios etc. With regard to protection, we estimate LGD per type of collateral using some external data.
We estimate EAD based on prior defaulted obligor data.
(iii) Asset Class-based EAD Ratios to the Total EAD by Credit RWA Calculation Approach
Internal Ratings-based Approach
Corporate
RetailEquities
Purchase Receivables
OthersStandardized Approach
Total

As of March 31, 201891.18%
79.20
6.24
2.75
1.75
1.21
8.81%
100.00%Notes: 1. Counterparty credit risk exposures, securitization exposures, and regarded-method exposures are excluded from the amount of credit risk exposures above.
2. As for any portfolio to which the standardized approach is applied, exposure instead of EAD is used for calculation.

274

Qualitative Disclosure on Credit Risk under IRB approach2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(iv) Quantitative Disclosure on Credit Risk under Internal Ratings-based Approach(A) CR6: IRB - Credit Risk Exposures by Portfolio and PD Range(Millions of yen, %, number in the thousands, year)

PD scale
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9

a
b
c
d
e
f
g
h
Original
Offon-balance balance
EAD
sheet
sheet Average post CRM Average Number Averagegross exposures CCF
and
PD
of
LGD Average
exposure pre CCF(%)
post-CCF(%)
obligors(%)
maturity
As of March 31, 2018

Sovereign¥65,282,123¥493,305
78.14 ¥67,094,685
0.00 to <0.15
0.15 to <0.25
30,742
3,142
75.00
9,343
0.25 to <0.50
76,127
14,762
75.00
76,6460.50 to <0.75
80,202
163
75.00
28,7980.75 to <2.50
62,602
9,186
75.00
947
2.50 to <10.00
16,952
2675.00
217
10.00 to <100.00
1,819
19
100.00 (Default)
65,550,571
520,586
77.97 67,210,657
Sub-total
Banks
3,444,364
704,05072.47
4,274,768
0.00 to <0.15
0.15 to <0.25
106,079
34,292
83.00
157,228
0.25 to <0.50
197,750
55,03572.89
211,024
0.50 to <0.75
130,564
9,911
75.32
138,6430.75 to <2.50
20,652
18,12867.96
24,0452.50 to <10.00
10.00 to <100.00
1,287
1,287
100.00 (Default)
3,900,699
821,41872.87
4,806,998
Sub-total
Corporate (except SME and specialized lending)
35,728,142 21,717,226
73.81 52,701,719
0.00 to <0.15
0.15 to <0.25
4,154,221
1,464,926
75.16
4,954,125
0.25 to <0.50
3,335,203
874,325
74.03
3,808,160
0.50 to <0.75
4,212,757
926,47875.97
4,518,372
0.75 to <2.50
1,967,931
684,28170.34
1,912,682
2.50 to <10.00
478,359
172,02177.99
418,948
10.00 to <100.00
420,603
22,23080.22
414,611100.00 (Default)
50,297,219 25,861,490
73.92 68,728,619
Sub-total
SME
82,86920,92674.99
98,5620.00 to <0.15
0.15 to <0.25
552,499
29,15273.71
562,058
0.25 to <0.50
688,348
26,43074.25
690,992
0.50 to <0.75
1,243,471
29,19275.43
1,226,916
0.75 to <2.50
454,790
12,35476.30
446,427
2.50 to <10.00
147,430
5,173
92.75
140,309
10.00 to <100.00
146,588623
66.96
137,093
100.00 (Default)
3,315,998
123,85375.47
3,302,360
Sub-total
Specialized Lending
2,375,330
262,27277.84
2,206,165
0.00 to <0.15
0.15 to <0.25
386,629
139,79777.89
373,2810.25 to <0.50
230,853
74,91877.70
215,900
0.50 to <0.75
413,034
107,07875.36
331,8110.75 to <2.50
76,132
14,241
76.45
51,7442.50 to <10.00
40,737
1,342
94.02
9,364
10.00 to <100.00
29,001389
100.0025,293100.00 (Default)
3,551,720
600,03977.41
3,213,563
Sub-total
Equities (PD/LGD approach)
3,704,926
21,305100.003,726,232
0.00 to <0.15
0.15 to <0.25
90,06790,0670.25 to <0.50
43,662
43,6620.50 to <0.75
40,38740,3870.75 to <2.50
113,095
113,095
2.50 to <10.00
915
915
10.00 to <100.00
5,710
5,710
100.00 (Default)¥3,998,766¥21,305
100.00 ¥4,020,072
Sub-total

275

Quantitative Disclosure on Credit Risk under IRB approach

i

j

k

l

RWA

RWA
density(%)

EL

Provisions

0.00
0.27
0.50
1.46
3.30
15.16
100.00
0.00

0.3
0.0
0.0
0.0
0.0
0.0
0.0
0.3

37.99
37.97
37.97
37.44
37.97
8.17
28.17
37.99

1.6
3.5
1.1
1.6
2.6
1.1
1.2
1.6

¥633,434
4,931
35,07622,0581,068
83
7696,660

0.94
52.77
45.76
76.59
112.71
38.66
37.33
1.03

¥828
9
146
158
11
2
4
1,163

¥/
/
/
/
/
/
/
/
792

0.06
0.27
0.50
1.00
3.13
100.00
0.16

0.3
0.0
0.0
0.0
0.0
0.0
0.5

37.38
34.08
36.75
36.73
40.38
96.57
37.26

1.4
1.5
1.4
1.4
2.2
4.9
1.4

693,677
45,560103,707
102,51228,335363
974,158

16.22
28.97
49.14
73.93
117.84
28.25
20.26

1,011
123
378
504
304
1,214
3,536

/
/
/
/
/
/
/
/
2,408

0.07
0.27
0.50
1.18
3.86
15.16
100.00
0.99

6.5
5.3
3.8
5.2
1.9
0.7
0.7
24.3

37.97
33.22
33.57
31.97
32.58
28.23
38.96
36.78

2.4
2.6
2.7
2.6
3.0
2.2
2.1
2.5

11,485,859
1,978,399
2,073,698
3,145,660
2,026,392
574,489
127,172
21,411,672

21.79
39.93
54.45
69.61
105.94137.1230.67
31.15

15,7864,556
6,434
17,16924,92017,943
151,385
238,196

/
/
/
/
/
/
/
/
162,210

0.07
0.27
0.50
1.19
3.25
15.16
100.00
5.83

0.0
3.0
3.3
5.9
1.7
0.7
0.6
15.4

31.64
24.31
23.91
20.75
19.05
17.98
42.41
22.89

2.3
2.8
3.0
3.4
3.7
3.1
2.2
3.2

14,696142,029
229,938
491,630
214,824
106,804
43,356
1,243,280

14.91
25.26
33.27
40.07
48.12
76.12
31.62
37.64

24
378
831
3,124
2,802
3,828
54,67865,667

/
/
/
/
/
/
/
/
44,718

0.09
0.27
0.50
1.02
4.38
15.16
100.00
1.13

0.4
0.0
0.0
0.0
0.0
0.0
0.0
0.6

36.49
38.49
43.42
38.49
38.19
37.97
64.04
37.64

4.3
4.1
4.1
4.5
3.5
3.9
4.2
4.2

707,374
219,941
185,680
335,100
68,274
18,836
12,473
1,547,680

32.06
58.92
86.00
100.99131.94201.13
49.31
48.16

759
397
471
1,312
867
539
15,201
19,549

/
/
/
/
/
/
/
/
13,313

0.05
0.27
0.50
1.15
3.76
15.16
100.00
0.33

1.0
0.5
0.3
0.2
0.0
0.0
0.1
2.3

90.00
90.00
90.00
90.00
90.00
90.00
90.00
90.00

5.0
5.0
5.0
5.0
5.0
5.0
5.0
5.0

3,795,623
142,515
89,021
107,668
425,736
5,851
64,245¥4,630,663

101.86158.23203.88266.58376.44638.79
1,125.00
115.18

/
/
/
/
/
/
/
/
¥/

/
/
/
/
/
/
/
/
¥/

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

CR6-(Continued)(Millions of yen, %, number in the thousands, year)

a
b
c
d
e
f
g
h
i
j
Original
OffEADon-balance balance
post CRM
RWA
sheet
sheet Average
andAverage Number Averagedensitygross exposures CCF
PDofLGD Average
postPD scale
exposure pre CCF
(%)
(%)
CCF
(%)
obligors(%)
maturity RWA
As of March 31, 2018
Purchased receivables (Corporate, etc.) - Default Risk Equivalent¥2,148,219¥701,913
75.14 ¥2,671,876
0.08
0.9
38.23
1.9
¥472,908
17.69
1 0.00 to <0.15
2 0.15 to <0.25
129,026
94,17577.74
202,240
0.27
0.2
37.89
2.0
80,62239.86
3 0.25 to <0.50
102,644
31,136
79.27
127,326
0.50
0.1
37.89
1.8
66,99752.61
4 0.50 to <0.75
83,54628,52877.42
105,635
1.04
0.1
37.88
2.3
80,95676.63
5 0.75 to <2.50
122,256
30,434
75.58
144,774
5.78
0.0
37.97
1.4
177,211122.406 2.50 to <10.00
1,163
18,48475.71
15,159
15.16
0.0
37.97
1.6
27,179179.28
7 10.00 to <100.00
1,720
1,720
100.00
0.0
93.53
1.0
521
30.29
8 100.00 (Default)
2,588,578
904,67375.65
3,268,735
0.51
1.6
38.20
1.9
906,398
27.72
9 Sub-total
Purchased receivables (Retail) - Default Risk Equivalent
1 0.00 to <0.15
2 0.15 to <0.25
3 0.25 to <0.50
4 0.50 to <0.75
5 0.75 to <2.50
6 2.50 to <10.00
7 10.00 to <100.00
8 100.00 (Default)
9 Sub-total
Purchased receivables (Dilution Risk Equivalent)
895,557
16,505100.00912,062
0.02
0.1
7.96
166,81718.29
1 0.00 to <0.15
2 0.15 to <0.25
11,735
11,735
0.27
0.0
37.97
3,654
31.13
3 0.25 to <0.50
17,22917,229
0.50
0.0
37.31
7,609
44.16
4 0.50 to <0.75
97,2405,881
100.00103,122
1.39
0.0
19.96
69,05966.96
5 0.75 to <2.50
11,811
11,811
3.03
0.0
8.82
11,11694.11
6 2.50 to <10.00
923
923
15.16
0.0
37.97
1,553
168.25
7 10.00 to <100.00
2,139
2,139
100.00
0.0
47.79
1,087
50.85
8 100.00 (Default)
1,036,637
22,387100.001,059,024
0.41
0.1
10.06
260,898
24.63
9 Sub-total
Retail – qualifying revolving retail exposures (QRRE)
0
0.13
0.0
78.04
/
0
6.01
1 0.00 to <0.15
33
0.18
0.4
77.05
/
2
7.79
2 0.15 to <0.25
60
0.34
2.0
78.04
/
7
12.85
3 0.25 to <0.50/
4 0.50 to <0.75
246,700
882,61715.67
385,057
2.31
484.0
78.03
/
214,81655.78
5 0.75 to <2.50
171,502904,560
8.86
251,550
4.06
1,838.978.04/
204,438
81.27
6 2.50 to <10.00
30,33015,70738.33
36,349
18.49
111.4
78.04
/
64,164176.51
7 10.00 to <100.00
547
1,389
12.13
710
100.00
2.1
71.86
/
564
79.48
8 100.00 (Default)
449,080
1,804,276
12.45
673,761
3.94
2,439.0
78.03/
483,995
71.83
9 Sub-total
Retail – Residential mortgage
1,753,094
1,788,294
0.07
134.0
29.40
/
98,8805.52
1 0.00 to <0.15
1,555,463
1,557,206
0.19
98.7
31.48
/
196,694
12.63
2 0.15 to <0.25
1,995,206
1,996,178
0.35
137.5
33.88
/
411,553
20.61
3 0.25 to <0.50
1,913,740
106,001
97.52
1,976,720
0.66
176.4
36.68
/
684,89734.64
4 0.50 to <0.75
1,540,512869
100.001,543,115
1.08
118.2
36.58
/
736,80447.74
5 0.75 to <2.50
78,221
2,795
100.0081,793
9.58
6.9
37.92
/
138,206
168.97
6 2.50 to <10.00
31,3082,477
100.0033,807
47.05
3.2
40.24
/
66,608197.027 10.00 to <100.00
67,581
1,372
100.0068,903100.004.3
45.19/
32,53347.21
8 100.00 (Default)
8,935,128
113,51697.68
9,046,019
1.48
679.7
33.80
/
2,366,178
26.15
9 Sub-total
Other retail20
307,294
0.05
41.4
43.50
/
19,0346.19
1 0.00 to <0.15
255,690
0.18
4.5
43.16
/
9,068
16.28
2 0.15 to <0.25
121,031155
100.00137,772
0.34
4.1
46.55
/
37,29127.06
3 0.25 to <0.50
188,160
550
75.18
184,968
0.69
65.9
26.93
/
41,51422.44
4 0.50 to <0.75
1,017,097
3,472
78.21
940,438
1.36
26.4
53.29
/
528,41956.18
5 0.75 to <2.50
398,879
1,897
63.40
174,889
6.29
16.0
22.22
/
57,98133.15
6 2.50 to <10.00
98,4279,870
51.83
49,497
18.27
11.8
31.29
/
32,25365.16
7 10.00 to <100.00
73,064
3,023
94.67
58,600100.002.9
44.01/
25,89744.19
8 100.00 (Default)
1,896,684
18,97065.72
1,909,152
4.89
173.4
44.68
/
751,460
39.36
9 Sub-total
70.60 ¥167,238,965
0.72
3,337.8
38.21
2.20 ¥35,273,045
21.01
Total (all portfolios) ¥145,521,084 ¥30,812,518

k

l

EL

Provisions

¥818
212
242
419
3,180
873
1,567
7,314

¥/
/
/
/
/
/
/
/
4,980

-

/
/
/
/
/
/
/
/
-

411
12
32
463
140
53
935
2,050

/
/
/
/
/
/
/
/
/

0
0
0
6,961
7,973
5,245
465
20,647

/
/
/
/
/
/
/
/
14,060

396
984
2,400
4,785
6,054
2,969
6,406
28,53752,535

/
/
/
/
/
/
/
/
35,776

75
43
224
327
5,988
2,149
3,156
23,72235,688¥446,348

/
/
/
/
/
/
/
/
24,303¥302,564

Notes: 1. Counterparty credit risk exposures, securitization exposures, and regarded-method exposures are excluded from the amount of credit risk exposures above.
2. On-balance sheet exposures, pre-CCF and pre- CRM off-balance sheet exposures, and the average CCF are allocated to the PD ranges based on pre- CRM PD
estimates.
3. The number of credits is disclosed as the number of data of obligors for QRRE, residential mortgage and other retail excluding credit for business purpose.

276

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(B) CR9: IRB - Backtesting of Probability of Default (PD) per Portfolio(%, the number of data)ab

Portfolio

PD
Range
(%)

c

i
AverageArithmeticof which:
Weighted
historical
average
Defaulted
newaverageannual
PD byobligorsdefaulted
As of
As of
PD
default
obligors
March
March in the year obligors
(%)
rate
(%)
in the year
31, 2017 31, 2018(%)

External rating equivalent

0.00 to<0.10
0.10 to<0.20
Corporate, 0.20 to
<1.00
etc.
1.00 to<5.00
5.00 to<100.00
0.00 to<0.10
0.10 toRetail –<0.20
qualifying
0.20 torevolving retail<1.00
exposures
1.00 to(QRRE)<5.00
5.00 to<100.00
0.00 to<0.10
0.10 to<0.20
Retail –0.20 toResidential<1.00
mortgage 1.00 to<5.00
5.00 to<100.00
0.00 to<0.10
0.10 to<0.20
0.20 toOther<1.00
retail1.00 to<5.00
5.00 to<100.00def
Number ofobligors

g

h

S&P

Moody’
Fitch
s

R&I

JCR

AAA～A-

Aaa～A3 AAA～A-

AAA～A-

AAA～A-

0.05

0.06

2,330

2,395

-

-

-

BBB+～BBB-

Baa1～Baa3

BBB+～BBB-

BBB+～BBB-

0.15

0.15

5,072

5,272

2

-

0.03

BB+～BB- Ba1～Ba3 BB+～BB- BB+～BB- BB+～BB-

0.48

0.52

20,736

21,267

52

-

0.21

B+～B-

B+～B-

2.06

2.15

9,832

9,041

112

2

1.29

CCC+～CCC- Caa1～Caa3 CCC+～CCC- CCC+～CCC- CCC～C

12.59

12.86

2,500

2,144

197

4

8.02

BBB+～BBB-

B1～B3

B+～B-

B+～B-

/

/

/

/

/

-

-

-

-

-

-

-

/

/

/

/

/

-

-

-

-

-

-

-

/

/

/

/

/

-

-

-

-

-

-

-

/

/

/

/

/

2.35

2.80

316,263

338,973

5,789

1,004

1.68

/

/

/

/

/

10.17

6.24

137,011

146,695

12,315

1,232

7.85

/

/

/

/

/

0.05

0.05

77,64971,310

20

-

0.02

/

/

/

/

/

0.14

0.14

101,477

103,939

44

-

0.07

/

/

/

/

/

0.53

0.53

413,756

395,746

966

3

0.28

/

/

/

/

/

1.26

1.22

62,37475,664

303

-

0.57

/

/

/

/

/

19.03

20.36

11,209

8,551

1,014

-

11.81

/

/

/

/

/

-

-

-

-

-

-

-

/

/

/

/

/

-

-

-

-

-

-

-

/

/

/

/

/

0.80

0.66

429,469

340,586

1,333

27

0.31

/

/

/

/

/

2.20

3.08

440,253

322,169

2,020

180

0.73

/

/

/

/

/

17.74

22.92

73,04447,241

3,113

13

4.23

Notes: 1. Counterparty credit risk exposures, securitization exposures, and regarded-method exposures are excluded from the amount of credit risk exposures above.
2. Exposures to sovereign and bank is included in the category of corporate, etc. because their obligors can be presumably specified. Likewise, exposures to corporate(except specialized lending), specialized lending, equity and purchased receivables (corporate) is included in the category of corporate, etc. because the data of therespective portfolios is not separately used for PD estimation. Since purchased receivables (retail) account for a small portion of the entire exposure, they areincorporated with any one of QRRE, residential mortgage or other retail depending on the portfolio classification of the purchased receivables.
3. PD Range indicates the ranges of PD estimates for multiple consolidated internal ratings groups.
4. The following shows the percentages accounted for by the respective portfolios among the credit RWA calculated by the AIRB: Corporate, etc. : 76%, QRRE: 1%,
Residential mortgage : 7%, Other retail : 3%
5. The number of credits is disclosed as the number of data of obligors for QRRE, residential mortgage and other retail excluding credit for business purpose.
6. The back testing covers the period from September 30, 2016 to September 30, 2017.

277

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(Millions of yen, %)As of March 31, 2018
a
b
c
d
e
f
g
h
i
Specialized lending under slotting criteria approach
Other than HVCRE
OnOffExposure amount
Regulatory
Remainingbalance balance
RW
categories
maturity
sheet
sheet
PF
OF
CF
IPRE
amount amountLess than 2.5 years¥¥- 50%¥¥¥¥Equal to or more
Strong
24,919- 70%
24,919than 2.5 years
Less than 2.5 years
Equal to or morethan 2.5 years

Good
Satisfactory
Weak
Default
Total
Regulatory
categories
StrongGood

Exchangetraded
equityexposures
Privateequityexposures
Other
equityexposures
Total
Equity exposures towhich a risk weight of
100% is applied

RWA

Expected
losses¥-¥-¥-24,91917,443

99

-

70%

-

-

-

-

-

-

-

-

90%

-

-

-

-

-

-

-

- 115%- 250%
-

HVCRE

3,464
11,147
9,312
48,844--

3,464
11,147
9,312
48,844

3,984
27,86849,296

97
891
4,656
5,744

OnOffbalance balance
RW
sheet
sheet
amount amountLess than 2.5 years
2,698
700 70%Categoriesl-Remainingmaturity

Satisfactory
Weak
Default
Total

Total

k

3,464
11,1083,081
42,574Equal to or morethan 2.5 years
Less than 2.5 years
Equal to or morethan 2.5 yearsj55,022

Expected
losses

RWA

3,225

2,257

12

67,29063,925269

16,356

95%

-

95%

13

13

0

3,970 120%

26,25031,500105

96,77997,696387

1323,260

Exposureamount- 140%- 250%
80,99621,026Equity exposures under the market-based approach etc.
Equity exposures under the market-based approach
OnOffbalance balance
RW
sheet
sheet
amount amountExposureamountRWA

841,626

68,014 300%

909,640 2,728,922

58,551

1,510 400%

59,683

238,735

-

-

-

-

-

900,177
69,524Equity exposures to which a risk weight of 100% is applied

4,415- 100%

969,324 2,967,658
4,415

4,415

Notes:1. Counterparty credit risk exposures, securitization exposures, and regarded-method exposures are excluded from the amount of credit risk exposures above.
2. PF, OF, CF and IPRE respectively stand for project finance, object finance, commodity finance and income-producing real estate.

(D) Credit RWA Exposures under Regarded-method(Millions of yen)Ending balance

As of March 31, 2018
¥2,102,954

278

Quantitative Disclosure on Credit Risk under IRB approach2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(5) Credit Risk under Standardized Approach(i) Status of portfolios to which the standardized approach is applied
Eligible external credit assessment institutions used for determining the risk weight for portfolios to which thestandardized approach is applied are Rating and Investment Information, Inc. (R&I) in Japan and S&P Global Ratings
overseas.
We apply a risk weight of 100% for all of our corporate exposure.
(ii) Quantitative disclosure on credit risk under standardized approach(A) CR5: Standardized Approach - Exposures by Asset Classes and Risk Weights(Millions of yen)

a

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22

Risk weight
Asset classes
CashJapanese sovereigns and Bank of Japan
Foreign central sovereigns and central
banksBank for International Settlements,etc.
Japanese non-central governmental PSEs
Non-central governmental PSEs otherthan foreign central sovereigns, etc.
International development banks
Japan Finance Organization for
Municipalities
Japanese government institutions
Three regional public sectors of Japan
Financial institutions and business
operators conducting the type I
financial instruments businessCorporates, etc.
Regulatory retail portfolios and individuals
Mortgage housing loan
Real estate acquisition business, etc.
Claims past due for 3 months or more
(excluding mortgage housing loan)
Claims past due for 3 months or moreregarding mortgage housing loanBills in process of collection
With guarantee of Credit Guarantee
Corporations, etc.
With guarantee of Regional Economy
Vitalization Corporation of Japan
Investments, etc.(excluding significant
investments)
Total

0%

As of March 31, 2018
b
c
d
e
f
g
h
i
j
Credit exposures amount (post CCF and post-CRM)
10% 20% 35% 50% 75% 100% 150% 250% 1,250%

k
Total

¥10,169
12,698,108
75,651¥-¥34,791¥-¥64,684¥-¥75,963¥-¥-¥- ¥10,169- 12,698,108- 251,091

1,089
-

-

7,731

-

38

-

16

-

-

-

1,089
7,786

2,983
-

36,192

-

-

-

-

-

-

-

-

2,983
36,192-

523,138-

703,187-

19,773-48,083---523,138
771,044

-

-

-

-

60

- 1,484,951
12

27

-

- 1,484,951
100

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

¥12,788,002 ¥559,331 ¥745,710¥-¥84,557¥- ¥1,609,027

¥27

¥-

¥- ¥15,786,656

Note: Counterparty credit risk exposures, credit risk related to securitization transactions, and exposures which are underlaid with the plural number of assets and transactions are
excluded from the amount of credit risk exposures above.

(B) Exposures which are underlaid with the plural number of assets and transactions and cannot be judged therisk weights directly in the institutions that adopt the Standardized Approach(Millions of yen)Ending balance279

Credit Risk under Standardized Approach

As of March 31, 2018-

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(6) Credit Risk Mitigation Techniques(i) Summary of Risk Profile, Risk Management Policies/ Procedures and Structure
We obtain collateral and guarantees as a means of securing credit. In obtaining the collateral and guarantees, weevaluate the value of the collateral, guarantee performance capability of guarantor and legal enforceability, and we also
conduct periodical subsequent re-evaluations. Furthermore, we monitor any concentration of risks in a particularclassification, keeping an eye on the concentration of collateral type and/or of credit risks in particular companies
including indirect credit exposure such as guarantees. When calculating the credit risk weighted assets for capital
adequacy ratio regulations, the effect of credit risk mitigation through financial collateral (mainly deposits and securities),
other collateral (mainly real estate) and guarantees by "sovereign, banks or corporations above a certain credit rating" isreflected.
(ii) Quantitative Disclosure on Credit Risk Mitigation Techniques
Counterparty risk exposures, securitization exposures, and regarded-method exposures are excluded from the amountof credit risk exposures below.
(A) CR3: Credit Risk Mitigation Techniques - Overview(Millions of yen)

a

1
2
3
4
5

Loans
Debt securities
Other on balance debt assets
Total (1+2+3)
Of which defaulted

Exposures
unsecured¥64,898,669
25,670,926
51,653,415¥142,223,012
461,445

As of March 31, 2018bcde
Exposures secured Exposures secured
Exposures secured
by financial
by credit
Exposures secured
by collateralguarantees
derivatives¥12,780,637¥5,990,412¥6,784,828¥5,397451,924
179,920
272,00344,607
5,016
39,591¥13,277,170¥6,175,349¥7,096,423¥5,397
192,214135,384
56,830-Notes: 1. Other on-balance debt assets include deposits, call loans, bills purchased, monetary claims bought, money held in trust, and foreign exchange assets, etc.
2. Defaulted exposures include restructured loans, loans past due for three months or more, loans to bankrupt borrowers and so on.

(B) CR4: Standardized Approach - Credit Risk Exposure and Credit Risk Mitigation (CRM) Effects(Millions of yen, except percentages)

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22

Asset classes
CashJapanese sovereigns and Bank of Japan
Foreign central sovereigns and central banks
Bank for International Settlements,etc.
Japanese non-central governmental PSEs
Non-central governmental PSEs otherthan foreign central sovereigns, etc.
International development banks
Japan Finance Organization For Municipalities
Japanese government institutions
Three regional public sectors of Japan
Financial institutions and business operators
conducting the type I financial instruments businessCorporates, etc.
Regulatory retail portfolios and individuals
Mortgage housing loan
Real estate acquisition business, etc.
Claims past due for 3 months or more
(excluding mortgage housing loan)
Claims past due for 3 months or moreregarding mortgage housing loanBills in process of collection
With guarantee of Credit Guarantee
Corporation, etc.
With guarantee of Regional Economy
Vitalization Corporation of Japan
Investments, etc.(excluding significant
investments)
Total

a
b
Exposures before CCF andCRM
On-balance
Off-balance
sheet amount sheet amount¥10,169¥12,698,108
251,091
1,089-

As of March 31, 2018cd
Exposures post-CCF andCRM
On-balance
Off-balance
sheet amount sheet amount¥10,169¥12,698,108
251,091
1,089
-

e

f

¥115,264-

RWA
density
0.00
0.00
45.90
0.00

RWA

7,786

-

7,786

-

1,581

20.31

2,983
36,192
523,138--

2,983
36,192
523,138--100
19,531
-

0.00
0.27
3.73
-

770,920774

770,657387

198,60725.75

1,282,944-

261,731-

1,282,944-

202,006-

1,484,893
-

99.99
-

100

-

100

-

83

83.26

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

¥262,506 ¥15,584,262¥202,393¥1,820,063

11.52¥15,584,525

280

Credit Risk Mitigation Techniques2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(C) CR7: IRB - Effect on RWA of Credit Derivatives Used as CRM Techniques(Millions of yen)

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16

As of March 31, 2018ab
Pre-credit
Actual RWA
derivatives RWA¥¥577,518
577,518
930,901
930,901
22,718,567
22,715,534
1,796,490
1,796,490
483,995
483,995
2,366,178
2,366,178
751,460
751,460
4,640,872
4,640,872
1,167,296
1,167,296¥35,433,279¥35,430,246

Portfolios
Sovereign - FIRB
Sovereign - AIRB
Banks - FIRB
Banks - AIRB
Corporate (except Specialized lending) - FIRB
Corporate (except Specialized lending) - AIRB
Specialized lending - FIRB
Specialized lending - AIRB
Retail - qualifying revolving retail exposures (QRRE)
Retail - residential mortgage exposures
Other retail exposures
Equity - FIRB
Equity - AIRB
Purchased receivables - FIRB
Purchased receivables - AIRB
Total

■ Counterparty Credit Risk
(1) Summary of Risk Profile, Risk Management Policies/ Procedures and Structure
In managing the risk pertaining to counterparty credit risk (including central counterparty) in derivatives transactions andrepurchase transactions etc., we generally allocate risk capital together with loans, etc., (we take into account wrong
way risk for derivatives transactions). For derivatives transactions and repurchase transactions, in cases in which abilateral netting agreement is valid in light of the legal system of the relevant jurisdiction, we take its effect into
consideration. As to derivatives transactions with financial institutions, etc., we periodically, where necessary, deliver
and receive collateral to and from the counterparty based on the replacement cost to mitigate credit risk (collateralized
derivatives transactions). In conducting such transactions, there is a risk in which we may be required to provide
additional collateral in cases where our credit profile deteriorates.
(2) Quantitative Disclosure on Counterparty Credit Risk
(A) CCR1: Analysis of Counterparty Credit risk (CCR) Exposure by Approach(Millions of yen)

1
2
3
4
5
6

SA-CCR
Current Exposure Method
Internal Model Method
Simple Approach for credit risk
mitigation
Comprehensive Approach for credit
risk mitigation
VAR for SFTs
Total

As of March 31, 2018cd
Alpha used forcomputingregulatory
EEPE
EAD
/
1.4
/
/
¥1,944,443
1.4

a

b

e

f

Replacementcost¥323,382/

Potential
futureexposure¥230,084
/

/

/

/

/

763,52139,710////10,332,329

654,325

/
/

/
/

/
/

/
/

/

¥1,798,303

EAD
post-CRM¥535,507
2,722,221

RWA¥216,424
887,843(B) CCR2: Credit Valuation Adjustment (CVA) Capital Charge(Millions of yen)

As of March 31, 2018a
EAD post-CRM
1
2
3
4
5

Total portfolios subject to the Advanced CVA capital charge(i) VAR component (including the 3×multiplier)(ii) Stressed VAR component (including the 3×multiplier)
All portfolios subject to the Standardized CVA capital charge
Total subject to the CVA capital charge¥//
3,552,645¥3,552,645b
RWA¥2,539,780¥2,539,780

281

Credit Risk Mitigation Techniques、Risk Management of Counterparty Credit Risk、Quantitative Disclosure on Counterparty Credit Risk

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(C) CCR3: Standardized Approach - CCR Exposures by Regulatory Portfolio and Risk Weights(Millions of yen)

As of March 31, 2018
b
c
d
e
f
g
h
Credit exposures amount (post CCF and post-CRM)
10%
20%
50%
75%
100% 150% Other

a

1
2
3
4
5
6
7
8
9
10
11
12
13
14

Risk weight 0%
Regulatory portfolio¥742,381
Japanese sovereigns and Bank of Japan
Foreign central sovereigns and central banks
4,065Bank for International Settlements,etc.
Japanese non-central governmental PSEs
Non-central governmental PSEs other thanforeign central sovereigns, etc.
International development banks
15,357
Japan Finance Organization for Municipalities
Japanese government institutions
Three regional public sectors of Japan
Financial institutions and business operators
conducting the type I financial instruments businessCorporates, etc.
Regulatory retail portfolios and individuals
Other assets
Total¥761,805

i
Total

¥-

¥3,934
-

¥361
-

¥-

¥289
-

¥-

¥-

¥742,381
8,650
-

-

6,843

1,504

-

12

-

-

8,361

1,076
-

-

-

-

-

-

-

15,357
1,076--

665,336

13,269-41,948--

720,554¥1,076¥676,114¥15,135¥-

679,087¥721,337¥-

679,087¥- ¥2,175,469(D) CCR4: IRB - CCR Exposures by Portfolio and PD Scale(Millions of yen, %, number in the thousands,year)

1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9
1
2
3
4
5
6
7
8
9

PD scale
Sovereign0.00 to <0.15
0.15 to <0.25
0.25 to <0.50
0.50 to <0.75
0.75 to <2.50
2.50 to <10.00
10.00 to <100.00
100.00 (Default)
Sub-totalBanks
0.00 to <0.15
0.15 to <0.25
0.25 to <0.50
0.50 to <0.75
0.75 to <2.50
2.50 to <10.00
10.00 to <100.00
100.00 (Default)
Sub-total
Corporate
0.00 to <0.15
0.15 to <0.25
0.25 to <0.50
0.50 to <0.75
0.75 to <2.50
2.50 to <10.00
10.00 to <100.00
100.00 (Default)
Sub-total

As of March 31, 2018cde
Number of
Average
Averagecounterparty LGD (%)
maturityaEAD
post-CRMb
AveragePD (%)

f¥9,213,266
419
682
2,944
84
9,217,397

0.00
0.27
0.50
1.28
6.34
0.00

0.0
0.0
0.0
0.0
0.0
0.0

37.97
37.97
37.97
37.97
37.97
37.97

4.5
2.3
3.0
4.9
1.6
4.5

¥40,100
180
440
3,291
108
44,120

0.43
42.94
64.52
111.77129.200.47

1,121,064
26,824
3,623
130
1,506
1,153,150

0.06
0.27
0.50
1.11
3.13
0.07

0.3
0.0
0.0
0.0
0.0
0.4

37.97
37.97
37.97
35.50
37.97
37.96

2.0
1.0
4.0
1.1
0.9
2.0

239,768
11,354
3,472
78
1,431
256,105

21.38
42.32
95.81
59.96
95.04
22.20

1,276,093
71,73945,44341,705
22,7792,328
1,301¥1,461,390

0.07
0.27
0.50
1.23
3.58
15.16
100.00
0.30

2.3
1.3
0.9
1.3
0.4
0.1
0.1
6.6

37.87
34.64
34.76
34.66
33.64
30.64
51.99
37.45

3.3
2.8
2.4
2.8
2.2
2.2
2.5
3.2

338,813
31,462
24,11732,92922,0503,445
446¥453,264

26.55
43.85
53.07
78.95
96.80
147.92
34.31
31.01

RWA

g
RWA density
(%)

282

Quantitative Disclosure on Counterparty Credit Risk

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

CCR4-(Continued)

PD scaleSME
1 0.00 to <0.15
2 0.15 to <0.25
3 0.25 to <0.50
4 0.50 to <0.75
5 0.75 to <2.50
6 2.50 to <10.00
7 10.00 to <100.00
8 100.00 (Default)
9 Sub-total
Specialized Lending
1 0.00 to <0.15
2 0.15 to <0.25
3 0.25 to <0.50
4 0.50 to <0.75
5 0.75 to <2.50
6 2.50 to <10.00
7 10.00 to <100.00
8 100.00 (Default)
9 Sub-total
Purchased receivables
1 0.00 to <0.15
2 0.15 to <0.25
3 0.25 to <0.50
4 0.50 to <0.75
5 0.75 to <2.50
6 2.50 to <10.00
7 10.00 to <100.00
8 100.00 (Default)
9 Sub-total
Retails
1 0.00 to <0.15
2 0.15 to <0.25
3 0.25 to <0.50
4 0.50 to <0.75
5 0.75 to <2.50
6 2.50 to <10.00
7 10.00 to <100.00
8 100.00 (Default)
9 Sub-total
Total (all portfolios)(Millions of yen, %, number in the thousands,year)aEAD
post-CRM

As of March 31, 2018cde
Number of
Average
Averagecounterparty LGD (%)
maturityb
AveragePD (%)fg
RWA density
(%)

RWA

¥147
7,928
5,688
6,843
4,172
999
559
26,340

0.07
0.27
0.50
1.16
3.16
15.16
100.00
3.69

0.0
0.5
0.5
0.9
0.2
0.0
0.0
2.5

14.18
21.80
22.58
23.24
23.43
22.64
40.35
22.98

2.7
3.2
3.3
3.2
3.8
3.0
3.5
3.3

¥12
1,954
1,892
3,136
2,612
984
126
10,718

8.33
24.64
33.27
45.82
62.61
98.44
22.51
40.69

209,425
36,81330,15934,864
2,966
1,194
2,768
318,190

0.10
0.27
0.50
0.96
3.60
15.16
100.00
1.21

0.1
0.0
0.0
0.0
0.0
0.0
0.0
0.3

40.14
38.75
37.97
37.97
37.97
37.97
55.90
39.64

4.5
4.6
4.3
4.1
4.0
3.4
4.9
4.5

84,82923,601
23,13532,817
3,861
2,348
1,540
172,134

40.50
64.11
76.70
94.12
130.20196.71
55.66
54.09

-

-

-

-

-

-

-

834
13
35
3
886
¥12,177,355

1.95
4.03
13.39
100.00
2.83
0.08

0.8
0.0
0.0
0.0
0.9
10.9

28.77
4.41
21.68
36.77
28.16
37.91

/
/
/
/
/
/
/
/
/
4.1

307
0
14
1
323
¥936,667

36.86
6.37
40.29
40.68
36.55
7.69

(E) CCR5: Composition of Collateral for CCR Exposure(Millions of yen)

As of March 31, 2018abcdCollateral used in derivative transactions
Fair value of collateral received Fair value of posted collateral

1
2
3
4
5
6
7
8
9

Cash – domestic currency
Cash – other currencies
Domestic sovereign debt
Other sovereign debt
Government agency debt
Corporate bonds
Equity securities
Other collateral
Total

283

Quantitative Disclosure on Counterparty Credit RiskefCollateral used in SFTs

Fair value ofcollateral
Segregated Unsegregated Segregated Unsegregatedreceived¥3,458¥481,886¥5,310¥803,536¥1,695,567
343,180
385,532
257,532
536,166
16,529,816
27,877
303,956
122,227
265,290
1,951,674
48,20569,742
253,988
184,4027,744,419
1,234
481
620,455
55
49,09421
3,141
493,226
254,472
128,584
1,904,428
7,806
4,944
4,464
¥424,012¥1,552,490¥639,562¥1,926,066 ¥30,944,054

Fair value of
postedcollateral¥2,996,441
9,267,379
2,364,378
13,853,163
1,070,112
603,156
1,413,438
394,305¥31,962,377

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(F) CCR6: Credit Derivatives Exposures(Millions of yen)

As of March 31, 2018a
Protection bought
Notionals
Single-name credit default swaps
Index credit default swaps
Total return swaps
Credit options
Other credit derivatives
Total notionals
Fair values
7 Positive fair value (asset)
8 Negative fair value (liability)
1
2
3
4
5
6

b
Protection sold

¥1,120,511
178,477¥1,142,042
159,997¥1,298,988¥1,302,040

2,480(18,489)

20,313(868)--(G) CCR8: Exposures to Central Counterparties(Millions of yen)

As of March 31, 2018a
EAD (post-CRM)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

Exposures to QCCPs (total)
Exposures for trades at QCCPs (excluding initial margin and default fundcontributions); of which(i) OTC derivatives(ii) Exchange-traded derivatives(iii) Securities financing transactions(iv) Netting sets where cross-product netting has been approved
Segregated initial marginNon-segregated initial margin
Pre-funded default fund contributions
Unfunded default fund contributions
Exposures to non-QCCPs (total)
Exposures for trades at non-QCCPs (excluding initial margin and default
fund contributions); of which(i) OTC derivatives(ii) Exchange-traded derivatives(iii) Securities financing transactions(iv) Netting sets where cross-product netting has been approved
Segregated initial marginNon-segregated initial margin
Pre-funded default fund contributions
Unfunded default fund contributions

/

b
RWA
¥193,088¥676,795¥3,053438,891
115,828122,076
95,392531,371
332,443
34,112
/

425
2,035
593
/
10,967
162,394
16,672
-

-

-

-

/
-

284

Quantitative Disclosure on Counterparty Credit Risk

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy■ Securitization Exposures
We classify transactions as securitization exposures based on two characteristics, “non-recourse” and“senior/subordinated structure,” pursuant to the definitions set forth in the FSA Notice No.20, etc.; provided that thetransactions do not include those which fall within specialized lending exposure.
(1) Summary of Risk Management Regarding Securitization Exposures

Our role in securitization transactions
We are associated with securitization transactions from various purposes and positions through our banking book andtrading book.
(a) Securitization of our assets (“Securitization as originator”)
For the purposes of mitigating credit risk and credit concentration risk, controlling economic capital and responding to
the needs of our investors, etc., we engage in securitization transactions, the underlying assets of which include
mortgage loans and loans to our corporate customers. When conducting a securitization as an originator, we consider
such transactions from various aspects, including the effects of reduction of economic capital and improvement ofreturn on risk as well as the practical effects of risk transfers, and make a comprehensive judgment on the structure
and appropriateness of such transactions.
(b) Securitization program (ABCP/ABL) sponsor
As a means of supporting our customers in the securitization of their account receivables and notes receivables, etc.,
we retain securitization exposure by providing asset-backed loans (ABLs, which are on-balance-sheet transactions),
and providing asset-backed commercial paper (ABCP) backup lines (off-balance-sheet transactions), as sponsor to
special purpose companies (in the form of Cayman Islands Corporations, etc.). In such cases, in addition to gaining
firm understanding of the actual risk profile through due diligence from the viewpoint of investors, we assign internalratings and make evaluations by assessing such transactions and carefully managing the exposure together withother direct loan assets.
(c) Investment in alternative credit risk assets (“Securitization Transactions as an Investor”)
We hold securitization products, such as ABS, CMBS, RMBS, and CDO, and resecuritization products, the underlying
assets of which are mainly RMBS and CDO, etc., for the purpose of investing in alternative credit risk assets that are
different from conventional credit risk assets in order to diversify our investment portfolio. The Risk Management
Committee, etc. set limits on the amount of investment for Securitization Transactions as an Investor, and we
maintain a stringent structure for management of such transactions. In addition, we implement stress tests based on
scenarios under the market liquidity depletion and sharp price declines.
In addition, we undertake various securitization program arrangements such as ABL, ABCP and trust schemes, etc., asa means of financing for our customers. We endeavor to understand the actual risk profile, including the underlying
assets, and to appropriately disclose the risks and terms of the program to the customers who invest in the product.
Furthermore, we actively act as servicer for securitization transactions, offer settlement account facilities (servicer cash
advance) and provide interest rate swaps to securitization conduits.
None of our affiliated entities hold securitization products in which we are involved as originators or sponsors.
The securitization conduits included within the scope of consolidation are as follows:ROCK FIELD CORPORATION, FANTASTIC FUNDING CORPORATION, ARTEMIS FUNDING CORPORATION,
N&M FUNDING CORPORATION, Denshi Saiken Kaitori Godo Kaisha, JAPAN SECURITIZATION CORPORATION,
Allstar Funding Co., Ltd, SPARCS FUNDING CORPORATION, PERPETUAL FUNDING CORPORATION,
Working Capital Management Co. L.P., ALWAYS CAPITAL CORPORATION, HORIZON CAPITAL CORPORATION
There are no securitization conduits that provide credit enhancement beyond what is provided in agreements.

Overview of risk profile of securitization transactions and monitoring system
In addition to price fluctuation and market liquidity risks, securitization and resecuritization products are exposed to risks
related to default, recovery and granularity of underlying asset portfolio. The structure of these products also contains
risks related to the originators, the administrators, trustees and managers of the underlying assets.
To address these risks, we also analyze the structure in terms of the underlying assets and credit events. We monitor
the ability, quality and operating performance of originators and managers in charge of controlling the underlying assets
as well as covenant information and credit status of the parties related to the program. In addition, for resecuritization
products, we pay attention to the underlying assets of the underlying securitization products. We also assign internalratings to all products and review the rating at least once a year. If there is a change in the credit situations, we will
review the internal rating as appropriate. As mentioned above, we have established a system to comprehensively
understand the risk characteristics of securitization exposures and manage these exposures.
We conduct credit risk measurements on all credit transactions, including securitization transactions. Furthermore, we
carry out periodic monitoring on investment amount and performance on securitization transactions and report thesituations to our Risk Management Committee, etc.

285

Summary of Securitization Exposure and Its Risk Management

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Response to Basel Framework
In calculating credit risk-weighted assets of securitization exposure under the internal ratings-based approach, we apply
the ratings-based approach (“RBA”) if the asset has a rating obtained from eligible external credit assessment
institutions and apply the supervisory formula approach (“SF”) in other cases pursuant to the FSA Notice No. 20. We
apply a risk weight of 1,250% under Basel III when neither RBA nor SF can be applied.
In addition, in calculating credit risk-weighted assets of securitization exposure under the standardized approach, we
calculate based on risk weight according to ratings by eligible external credit assessment institutions and weighted
average risk weight of underlying assets.
In terms of securitization exposure in our trading book that is subject to market risk regulations, we adopt thestandardized measurement method and calculate market risk equivalent amounts in connection with the specific risks of
securitization products based on risk weights according to ratings assigned by eligible external credit assessment
institutions pursuant to the FSA Notice No. 20.
As for the eligible external credit assessment institutions, we refer to Rating and Investment Information, Inc. (R&I),
Japan Credit Rating Agency, Ltd. (JCR), Moody's Investors Service Inc. (Moody's), Standard & Poor's (S&P) and Fitch
Ratings, Ltd. in determining securitization exposure risk weight.
(2) Accounting Policies for Securitization Transactions
The point at which financial assets and liabilities relating to securitization transactions begin or cease to be recognized,
their evaluation and accounting treatment are pursuant to "Accounting Standards Relating to Financial
Products"(Business Accounting Standards No. 10).
(3) Quantitative Disclosure on Securitization Exposures(A) SEC1: Securitization Exposures in the Banking Book by Type of Underlying Assets(Millions of yen)

As of March 31, 2018
a
b
c
d
e
f
g
h
i
Bank acts as originator
Bank acts as sponsor
Banks acts as investor
type of underlying assets Traditional Synthetic Sub-total Traditional Synthetic Sub-total Traditional Synthetic Sub-total¥0¥¥0 ¥882,415¥- ¥882,415 ¥1,745,598¥- ¥1,745,598
1 Retail (total) - of which
200842,644842,644
residential mortgage
3credit card
219,986
219,986
93,976
93,9764other retail exposures
662,429
662,429
808,977
808,977
re-securitization
5
6 Wholesale (total) - of which
422,098
422,098
219,123
219,123
913,169
913,1697
422,098
422,098
398,149
398,149
loans to corporates
8commercial mortgage
210
210
9
lease and receivables
219,123
219,123
414,345414,345
10other wholesale
100,463
100,46311
re-securitization-(B) SEC2: Securitization Exposures in the Trading Book by Type of Underlying Assets(Millions of yen)

As of March 31, 2018
a
b
c
d
e
f
g
h
i
Bank acts as originator
Bank acts as sponsor
Banks acts as investor
type of underlying assets Traditional Synthetic Sub-total Traditional Synthetic Sub-total Traditional Synthetic Sub-total¥11,560¥11,560
1 Retail (total) - of which¥¥¥¥¥¥¥2
4,287
4,287
residential mortgage
3credit card
2,956
2,956
4
other retail exposures
4,316
4,316
re-securitization
00
5
6 Wholesale (total) - of which
11,541
11,541
7
11,240
11,240loans to corporates
8commercial mortgage
9lease and receivables
301
301
10
other wholesale
11
re-securitization-

286

Summary of Securitization Exposure and Its Risk Management、Accounting Policies for Securitization Transactions、Quantitative Disclosure Items
for Securitization Exposure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(C) SEC3: Securitization Exposures in the Banking Book and Associated Regulatory Capital Requirements Bank Acting as Originator or as Sponsor(Millions of yen)ab

As of March 31, 2018
d
e

c

f

g

h

Of which
Of which
Traditional
Of which
retailOf which
reOf which Of which
Total
exposures securitization securitization underlying wholesale securitization senior non-senior
Exposure values (by RW bands)¥1,478,354 ¥1,075,137 ¥1,075,137
1 ≤20% RW
2 >20% to 50% RW
25,51525,51525,515
3 >50% to 100% RW
886
886
886
4 >100% to <1250% RW
18,2015 1250% RW
680
Exposure values (by regulatory approach)
136,048
136,048
136,048
6 IRB RBA (including IAA)
7 IRB SFA
1,386,908
965,490
965,490
8 SA/SSFA
9 1250%680
RWA (by regulatory approach)
11,093
11,093
11,093
10 IRB RBA (including IAA)
11 IRB SFA
110,473
77,763
77,76312 SA/SSFA
13 1250%
8,500
Capital charge after cap
940
940
940
14 IRB RBA (including IAA)
15 IRB SFA
9,368
6,594
6,594
16 SA/SSFA
17 1250%
720
-

i

j

k

¥859,674
22,741-¥215,463
2,773
886
-

¥-

¥-

¥-

117,049
765,366-

18,999200,124
-

-

-

-

9,722
58,417-

1,370
19,345
-

-

-

-

824
4,953
-

116
1,640
-

-

-

-

As of March 31, 2018
l
m

n

o

Of which
Of which
retailOf which
reOf which Of which
Synthetic Of which
securitization securitization underlying wholesale securitization senior non-senior
Exposure values (by RW bands)¥403,216
1 ≤20% RW
2 >20% to 50% RW
3 >50% to 100% RW
4 >100% to <1250% RW
18,2015 1250% RW
680
Exposure values (by regulatory approach)
6 IRB RBA (including IAA)
7 IRB SFA
421,418
8 SA/SSFA
9 1250%680
RWA (by regulatory approach)
10 IRB RBA (including IAA)
11 IRB SFA
32,710
12 SA/SSFA
13 1250%
8,500
Capital charge after cap
14 IRB RBA (including IAA)
15 IRB SFA
2,773
16 SA/SSFA
17 1250%720

287

Quantitative Disclosure Items for Securitization Exposure¥403,216
18,201
680¥-¥403,216
18,201
680

¥-

¥-

¥-

421,418680-

421,418
680

-

-

-

32,7108,500-

32,710
8,500

-

-

-

2,773
720

-

2,773
720

-

-

-

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(D) SEC4: Securitization Exposures in the Banking Book and Associated Regulatory Capital Requirements Bank Acting as Investor(Millions of yen)ab

As of March 31, 2018
d
e

c

f

g

h

Of which
Of which
Traditional
Of which
retailOf which
reOf which Of which
Total
exposures securitization securitization underlying wholesale securitization senior non-senior
Exposure values (by RW bands)
1 ≤20% RW
2 >20% to 50% RW
3 >50% to 100% RW
4 >100% to <1250% RW
5 1250% RW
Exposure values (by regulatory
approach)
6 IRB RBA (including IAA)
7 IRB SFA
8 SA/SSFA
9 1250%RWA (by regulatory approach)
10 IRB RBA (including IAA)
11 IRB SFA
12 SA/SSFA
13 1250%
Capital charge after cap
14 IRB RBA (including IAA)
15 IRB SFA
16 SA/SSFA
17 1250%¥2,535,058 ¥2,535,058 ¥2,535,058 ¥1,677,283
107,393
107,393
107,393
68,315
7,415
7,415
7,415
8,678
8,678
8,678
220
220
220
0

¥857,775
39,078
7,415
8,678
220

¥-

¥-

¥-

1,381,546
1,264,262
12,737220

1,381,546
1,264,262
12,737220

1,381,546
1,264,262
12,737220

929,913815,585100
0451,633
448,677
12,637
220

-

-

-

99,457
121,018
25,711
2,761

99,457
121,018
25,711
2,761

99,457
121,018
25,711
2,761

67,76869,25720
031,68951,761
25,691
2,761

-

-

-

8,433
10,262
2,056
220

8,433
10,262
2,056
220

8,433
10,262
2,056
220

5,746
5,873
1
0

2,687
4,389
2,055
220

-

-

-

i

j

k

As of March 31, 2018
l
m

n

o

Of which
Of which
retailOf which
reOf which Of which
Synthetic Of which
securitization securitization underlying wholesale securitization senior non-senior
Exposure values (by RW bands)
1 ≤20% RW
2 >20% to 50% RW
3 >50% to 100% RW
4 >100% to <1250% RW
5 1250% RW
Exposure values (by regulatory
approach)
6 IRB RBA (including IAA)
7 IRB SFA
8 SA/SSFA
9 1250%RWA (by regulatory approach)
10 IRB RBA (including IAA)
11 IRB SFA
12 SA/SSFA
13 1250%
Capital charge after cap
14 IRB RBA (including IAA)
15 IRB SFA
16 SA/SSFA
17 1250%

¥-

¥-

¥-

¥-

¥-

¥-

¥-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

288

Quantitative Disclosure Items for Securitization Exposure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy■ Market Risk
See pages 117 to 119 for information regarding our market risk management structure, etc.
(1) Trading Activities
In the calculation of the market risk equivalent amounts under the regulatory capital requirements, the risk arising fromfluctuations in common factors across the market as a whole (e.g. foreign exchange and interest rates, etc.) is referred toas general market risk, and the risk arising from a deterioration in creditworthiness or market liquidity inherent in bonds
and stocks is referred to as specific risk. In principle, we calculate market risk equivalent amounts by determining bothgeneral market risk and specific risk by applying the Internal Models Approach (IMA) to the former and the standardized
approach to the latter, and by simply adding up both amounts. The Internal Models Approach is applied to tradingtransactions and calculated by adding up VAR and stressed VAR.
(A) MR1：Market risk under standardized approach

No.
1
2
3
4
5
6
7
8
9

Interest rate risk (general and specific)
Equity risk (general and specific)
Foreign exchange risk
Commodity risk
Options
Simplified approach
Delta-plus method
Scenario approach
Securitization
Total(B) MR3：IMA values for trading portfolios
No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17

(Millions of yen)
As of March 31, 2018
RWA
(Risk equivalent / 8%)¥405,247
652,526
81,926167,631
24,62874,438¥1,406,398(Millions of yen)
As of March 31, 2018

VAR (10 day 99%)
Maximum value
Average value
Minimum value
Period end
Stressed VAR (10 day 99%)
Maximum value
Average value
Minimum value
Period end
Incremental Risk Charge (99.9%)
Maximum value
Average value
Minimum value
Period end
Comprehensive Risk Capital Charge (99.9％)
Maximum value
Average value
Minimum value
Period end
Floor (standardized measurement method)¥13,059
7,496
4,978
7,120
27,27018,882
13,131
17,093-

Notes: 1. The historical simulation method is used for the calculation of VAR and stressed VAR under the Internal Models Approach.
2. VAR is measured based on the observation period of 3 years (801 business days), a 99% confidence interval and a 1-day holding period. This 1-day VAR is scaled up to 10business day VAR using the square-root-of-time (√T) rule. We update historical data on a daily basis, in principle, and do not weight such data. When re-pricing instruments,
we use the full revaluation method, a sensitivity-based approach and the like. We consider change width or rate as market volatility of risk factors according to productattributes.
3. When measuring stressed VAR, the same measurement approach as VAR is used except for the observation period of 1 year (265 business days). As a stressed period,
we select a period which has an adequate length of time and is considered the most stressful under a certain set of criteria established based on the most recent portfolio.
4. When applying the internal model, we regularly verify the preconditions used for VAR measurement.

289

Trading Activities2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(C) MR4：Back testing results of IMA

Note: The above graphs show the results of backtesting performed for the most recent 250 business days including the reporting reference date.

(2) Banking Activities
To comply with Interest Rate Risk in the Banking Book (IRRBB) requirements, we are required to calculate expectedchanges in the economic value of equity (ΔEVE) arising from banking activities and expected changes in net interest
income (ΔNII) from the reference date until the date no later than 12 months from the reference date under interest rate
shock scenarios (i.e. parallel up and downwards shifts in the yield curve and the like).
(D) IRRBB1：Interest rate risk
a

c

ΔEVE
As of March
As of March
31, 2018
31, 2017

No.
1
2
3
4
5
6
7

(Millions of yen)d
ΔNII
As of March
As of March
31, 2018
31, 2017b

Parallel up
Parallel down
Steepener
Flattener
Short rate up
Short rate down
Maximum¥895,4160436,819
90,789321,141
69,824895,416

/
/
/
/
/
/
/

e
As of March 31, 20188

Tier1 capital¥9,192,244¥(274,475)
370,566////
370,566

/
/
/
/
/
/
/

f
As of March 31, 2017/

Notes: 1. Decreased economic values and interest income are shown as positive values.
2. As for some of those current deposits and ordinary deposits whose interest rates are not changed at predetermined intervals and from which depositors can withdraw
money as desired on demand, we measure the interest rate risk associated with such deposits by applying an appropriate method after recognizing them as core deposits.
The average repricing maturities are 0.9 years for yen deposits and 0.1 years for dollar deposits respectively. The longest repricing maturities are 10.0 years for yen
deposits and 5.0 years for dollar deposits respectively. We measure interest rate risk associated with term deposits and loans in an appropriate manner by estimating theirearly redemption rates based on their historical prepayment and cancellation data.
3. When aggregating the respective ΔEVE of multiple currencies, we use the internal model that estimates the correlations between the key currencies based on historical
data. When aggregating the respective ΔNII of multiple currencies, we simply add their respective ΔNII.
4. For the calculation of ΔEVE and ΔNII, we set an appropriate interest rate and spread according to a certain discount rate and reference rate.
5. When making the calculations above, we use regulatory defined preconditions including an interest rate shock scenario.

290

Trading Activities、Banking Activities2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy■ Investment or Equity Exposure(1) Summary of Risk Profile, Risk Management Policies/ Procedures and StructureWith regard to equities, we manage default risk through our credit risk management structure and price fluctuation risk
through our market risk management structure. With regard to subsidiaries and related companies in which we invest,
we manage their risks on a consolidated basis, and manage them appropriately in accordance with their managementclassification. In addition, securities, a part of equity exposure, are valued as follows: Japanese stocks with quoted
market prices are valued based on the average quoted market price over the month preceding the consolidated balance
sheet date; other securities which have readily determinable fair values are valued at the quoted market price if
available, or otherwise based on their reasonable value at the consolidated balance sheet date (cost of securities sold is
calculated primarily by the moving average method); and other securities the fair values of which are extremely difficult
to determine are stated at acquisition cost or amortized cost and determined by the moving average method.

■ Operational risk
(1) Summary of Operational Risk Management and Procedures
See pages 121 to 124 for a summary of our operational risk management policies, etc.
(2) Approach Used for the Measurement of Operational Risk Equivalent
We use the advanced measurement approach for the calculation of operational risk equivalent. See pages 122 to 124 forthe outline and the scope of application of the advanced measurement approach. In the measurement of operational risk
equivalent, we do not recognize the risk mitigating impact of insurance.

291

Summary of Risk Profile, Risk Management Policies/ Procedures and Structure、Summary of Operational Risk Management and Procedures、Approach
Used for the Measurement of Operational Risk Equivalent

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）■Composition of Leverage Ratio(Millions of yen)
Correspon Correspon
ding line # ding line #on Baselon BaselIIIIII
disclosure disclosure
template
template(Table 2) (Table 1)

Item

On-balance sheet exposures (1)On-balance sheet exposures before deducting adjustment
1items
1 Total assets reported in the consolidated balance sheet
1a
The amount of assets of subsidiaries that are not included in
1b
2
the scope of the leverage ratio on a consolidated basis (-)
The amount of assets of subsidiaries that are included in thescope of the leverage ratio on a consolidated basis (except
1c7
those included in the total assets reported in the consolidatedbalance sheet)
The amount of assets that are deducted from the total assets
1d
3 reported in the consolidated balance sheet (except
adjustment items) (-)
2
7 The amount of adjustment items pertaining to Tier1 capital (-)
Total on-balance sheet exposures(a)3
Exposures related to derivative transactions (2)Replacement cost associated with derivatives transactions,4etc.
5
Add-on amount associated with derivatives transactions, etc.
The amount of receivables arising from providing cash margin
in relation to derivatives transactions, etc.
The amount of receivables arising from providing cash
6
margin, provided where deducted from the consolidatedbalance sheet pursuant to the operative accounting framework
The amount of deductions of receivables (out of those arising7
from providing cash variation margin) (-)
The amount of client-cleared trade exposures for which a
8bank holding company acting as a clearing member is not
obliged to make any indemnification (-)
9Adjusted effective notional amount of written credit derivatives
The amount of deductions from effective notional amount of10
written credit derivatives (-)(b)
11
4 Total exposures related to derivative transactions
Exposures related to repo transactions (3)The amount of assets related to repo transactions, etc
1213
The amount of deductions from the assets above (line 12) (-)
The exposures for counterparty credit risk for repo
14
transactions, etc
The exposures for agent repo transactions
15
(c)
16
5 Total exposures related to repo transactions, etc.
Exposures related to off-balance sheet transactions (4)Notional amount of off-balance sheet transactions
17
The amount of adjustments for conversion in relation to off18
balance sheet transactions (-)
19
6 Total exposures related to off-balance sheet transactions (d)Leverage ratio on a consolidated basis (5)The amount of capital (Tier1 capital)
(e)
20
(f)
21
8 Total exposures ((a)+(b)+(c)+(d))
Leverage ratio on a consolidated basis ((e)/(f))
22

As of March 31,
2018

As of March 31,
2017¥178,888,103¥174,146,451

205,028,300

200,508,610

-

-

-

-

26,140,197

26,362,159

1,685,871¥177,202,231

1,296,500¥172,849,950

2,655,175

2,454,674

6,524,621

5,615,193

858,877

1,038,620

263,112204,188

-

-

/

/

1,319,146

1,882,691

1,207,805

1,705,729¥10,413,128¥9,489,638

12,431,400
4,196,150

12,317,829
5,179,456

521,728

385,734/¥8,756,979/¥7,524,107

50,668,428

49,117,932

32,762,942

31,579,950¥17,905,485¥17,537,982

9,192,244¥214,277,824
4.28%

8,211,522¥207,401,679
3.95%

292

Composition of Leverage Ratio

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy■Indicators for Assessing Global Systemically Important Banks (G-SIBs)
Item
No.

1

2

3

4
5
6
7

8
9
10
Item
No.

11

12

Description

Total exposures (= a + b + c + d):a. On-balance sheet assets (other than assets specifically identified belowb., c. and contra-account of guarantees)b. Sum of counterparty exposure of derivatives contracts, capped notionalamount of written credit derivatives and potential future exposure ofderivatives contracts
c. Adjusted gross value of securities financing transactions (SFTs) andcounterparty exposure of SFTs
d. Gross notional amount of off-balance sheet items (other thanderivatives contracts and SFTs )Intra-financial system assets (= a + b + c + d):a. Funds deposited with or lent to other financial institutions and undrawn
committed lines extended to other financial institutions
b. Holdings of securities issued by other financial institutions (Note 1)
c. Net positive current exposure of SFTs with other financial institutions
d. Over-the-counter (OTC) derivatives with other financial institutions thathave a net positive fair value
Intra-financial system liabilities (=a + b + c):a. Deposits due to, and loans and undrawn committed lines obtained from,other financial institutions
b. Net negative current exposure of SFTs with other financial institutions
c. OTC derivatives with other financial institutions that have a net negative
fair value
Securities outstanding(Note 1)
Assets under custody
Notional amount of OTC derivatives
Held-for-trading(HFT) securities and available-for-sale(AFS) securities ,
excluding HFT and AFS securities that meet the definition of Level 1
assets and Level 2 assets with haircuts (Note 2)
Level 3 assets (Note 3)
Cross-jurisdictional claims
Cross-jurisdictional liabilities

Description

Payments (settled through the BOJ-NET, the Japanese Banks' Payment
Clearing Network and other similar settlement systems, excluding
intragroup payments)
Underwritten transactions in debt and equity markets (Note 4)

As of March 31,
2018(Billions of yen)
As of March 31,
2017¥215,963.6¥208,698.1

12,910.4

12,248.4

22,558.2

20,482.5

24,854.2
140,047.3
1,168,293.9
10,838.3

24,386.5
144,337.5
916,188.1
9,728.9

1,901.4
45,183.0
31,932.9

1,774.5
44,852.9
30,741.5

For the fiscal
year ended
March 31, 2018

For the fiscal
year ended
March 31, 2017

¥5,991,927.8¥5,820,573.6

16,938.1

14,159.9

Notes: 1. Securities refer to secured debt securities, senior unsecured debt securities, subordinated debt securities, commercial paper, certificate of deposits, and common equities.
2. Level 1 and Level 2 assets with haircuts are defined in the Basel III Liquidity Coverage Ratio (LCR).
3. The amount is calculated in accordance with the U.S.GAAP.
4. This refers to underwriting of securities defined in article 2 paragraph 8 item 6 of the Financial Instruments and Exchange Act.

293

Indicators for assessing Global Systemically Important Banks (G-SIBs)

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Disclosure of Information for the Fiscal Year Ended on March 31, 2017 According to the Relevant Old FSA Notice
Among the information disclosed for the fiscal year ended March 31, 2017, according to the relevant Old FSA Notice, see
the following for the items which are different from those disclosed according to the New FSA Notice.

□ Risk-based Capital(1) Required Capital by Portfolio Classification(Billions of yen)

Credit risk
Internal ratings-based approach
Corporate (except specialized lending)Corporate (specialized lending)
SovereignBank
RetailResidential mortgage
Qualifying revolving loan
Other retail
Equities
PD/LGD approach
Market-based approach (simple risk weight method)
Market-based approach (internal models approach)
Regarded-method exposure
Purchase receivables
Securitizations
OthersStandardized approach
Sovereign
Bank
Corporate
Residential mortgage
Securitizations
Others
CVA risk
Central counterparty-relatedMarket risk
Standardized approach
Interest rate risk
Equities risk
Foreign exchange risk
Commodities risk
Option transactions
Internal models approach
Operational risk
Advanced measurement approach
Basic indicator approach
Total required capital (consolidated)

As of March 31, 2017
EAD
Required capital¥207,375.9¥5,078.5
189,852.0
4,600.4
71,777.8
2,468.9
3,630.9
225.4
80,002.7
81.0
5,902.0
113.6
12,235.5
486.3
9,388.0
312.2
629.2
48.8
2,218.2
125.1
4,973.3
691.4
4,180.1
485.4
793.1
205.9
1,744.0
268.4
3,297.5
102.5
4,009.5
26.3
2,278.3
136.3
17,523.9
280.6
12,638.5
12.2
1,930.1
36.7
2,354.5
177.3
14.4
2.1
586.1
52.0
/
181.7
/
15.6
/
182.6
/
103.6
/
39.0
/
34.2
/
6.9
/
23.4
/
/
78.9
/
269.9
/
223.4
/
46.5
/
¥4,937.3

Note: EAD calculated using the standardized approach for credit risk represents the amount before the deduction of specific reserve for possible losses on loans, reserve forpossible losses on loans to restructuring countries and partial direct write-offs.

294

Risk-based Capital2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy□ Credit Risk
(2) Credit Risk Exposures, etc.
The amounts associated with regarded-method exposures and securitization exposures are excluded. The outstandingbalance is based on exposure at default.

Status of Credit Risk Exposure(A) Breakdown by Geographical Area
(Billions of yen)

As of March 31, 2017

Domestic
Overseas
Asia
Central and South America
North America
Eastern Europe
Western Europe
Other areas
Total
Exempt portion

Loans, commitments andother non-derivative
off-balance-sheet exposures¥68,581.7
37,218.6
8,907.9
2,978.7
14,644.8
289.1
6,597.03,800.9¥105,800.4/

Securities¥19,414.3
10,014.2
2,145.6
56.3
6,304.6
882.1
625.3¥29,428.5/

Derivatives¥954.6
1,635.9
472.7
85.1
339.6
0.2
581.5
156.5
¥2,590.5/

Others¥38,424.0
7,854.8
1,865.2456.3
4,420.9
4.6
722.7
384.9
¥46,278.8/

Total¥127,374.7
56,723.7
13,391.6
3,576.6
25,710.0294.0
8,783.4
4,967.7¥184,098.4
17,509.4

Notes: 1. Exempt portion represents the amount before the deduction of specific reserve for possible losses on loans, reserve for possible losses on loans to restructuring countries
and partial direct write-offs, calculated using the standardized approach for business units and asset classes that are immaterial for the purpose of calculating credit riskweighted assets.
2. Exposure to non-Japanese residents is included in "Overseas."
3. "Others" include cash, deposits, call loans, other debt purchased, money held in trust, foreign exchange assets, other assets, etc.

(B) Breakdown by Industry(Billions of yen)

As of March 31, 2017

Manufacturing
Construction
Real estate
Service industries
Wholesale and retail
Finance and insurance
Individuals
Other industries
Japanese Government; Bank of Japan
Total
Exempt portion

Loans, commitments andother non-derivative
off-balance-sheet exposures¥20,272.4
1,349.2
8,608.9
5,018.6
8,532.7
12,095.5
11,071.5
25,759.5
13,091.8¥105,800.4/

Securities¥2,299.9
215.0
570.4
397.7
738.9
3,034.3
8,846.0
13,325.9¥29,428.5/

Derivatives¥424.1
7.6
83.5
77.4
92.3
896.8
0.8
1,002.5
5.1¥2,590.5/

Others¥742.9
70.6
19.7
68.0
994.4
2,144.1
9.4
8,360.3
33,868.8¥46,278.8/

Total¥23,739.5
1,642.4
9,282.6
5,561.9
10,358.5
18,170.9
11,081.8
43,968.5
60,291.8¥184,098.4
17,509.4

Notes: 1. Exempt portion represents the amount before the deduction of specific reserve for possible losses on loans, reserve for possible losses on loans to restructuring countries
and partial direct write-offs, calculated using the standardized approach for business units and asset classes that are immaterial for the purpose of calculating credit riskweighted assets.
2. "Others" include cash, deposits, call loans, other debt purchased, money held in trust, foreign exchange assets, other assets, etc.

(C) Breakdown by Residual Contractual Maturity(Billions of yen)

As of March 31, 2017

Less than one year
From one year to less than three years
From three years to less than five years
Five years or more
Other than above
Total
Exempt portion

Loans, commitments andother non-derivative
off-balance-sheet exposures¥28,002.1
18,999.1
19,035.9
27,912.4
11,850.6¥105,800.4/

Securities¥7,317.2
7,689.9
1,879.4
7,705.1
4,836.7¥29,428.5/

Derivatives¥378.8
980.2
451.7
759.0
20.5
¥2,590.5/

Others¥5,819.6
676.6
17.8
11.9
39,752.7¥46,278.8/

Total¥41,518.0
28,346.1
21,384.9
36,388.5
56,460.7¥184,098.4
17,509.4

Notes: 1. Exempt portion represents the amount before the deduction of specific reserve for possible losses on loans, reserve for possible losses on loans to restructuring countries
and partial direct write-offs, calculated using the standardized approach for business units and asset classes that are immaterial for the purpose of calculating credit riskweighted assets.
2. "Others" include cash, deposits, call loans, other debt purchased, money held in trust, foreign exchange assets, other assets, etc.

295

Credit Risk Exposures2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Status of Exposure Past Due Three Months or More or in Default(D) Breakdown by Geographical Area
(Billions of yen)

As of March 31, 2017

Domestic
Overseas
Asia
Central and South America
North America
Eastern Europe
Western Europe
Other areas
Total
Exempt portion

Loans, commitments andother non-derivative
off-balance-sheet exposures¥973.8
244.6
54.2
98.5
30.1
0.6
47.3
13.7
¥1,218.5/

Securities
¥90.6
2.9
0.0
0.0
2.9
0.0
¥93.6
/

Derivatives
¥2.9
7.8
1.8
2.8
0.1
0.0
2.9
0.0
¥10.8
/

Others
¥10.5
3.3
1.1
0.0
1.4
0.5
0.1
¥13.9
/

Total
¥1,078.1
258.8
57.2
101.3
34.7
0.7
50.8
13.9
¥1,336.9
3.6

Notes: 1. Exempt portion represents the amount before the deduction of specific reserve for possible losses on loans, reserve for possible losses on loans to restructuring countries
and partial direct write-offs, calculated using the standardized approach for business units and asset classes that are immaterial for the purpose of calculating credit riskweighted assets.
2. Exposure to non-Japanese residents is included in “Overseas.”
3. “Others” include deposits, call loans, other debt purchased, money held in trust, foreign exchange assets, other assets, etc.

(E) Breakdown by Industry(Billions of yen)

As of March 31, 2017

Manufacturing
Construction
Real estate
Service industries
Wholesale and retail
Finance and insurance
Individuals
Other industries
Total
Exempt portion

Loans, commitments andother non-derivative offbalance-sheet exposures¥548.4
13.2
59.0
84.1
176.1
11.1
94.6
231.8
¥1,218.5/

Securities
¥87.5
0.0
0.3
0.4
2.2
2.6
0.3
¥93.6
/

Derivatives
¥2.9
0.0
0.1
0.9
0.3
0.0
6.4
¥10.8
/

Others
¥4.8
0.0
0.2
0.9
4.1
1.8
1.1
0.7
¥13.9
/

Total
¥643.8
13.3
59.6
86.4
182.8
15.6
95.7
239.4
¥1,336.9
3.6

Notes: 1. Exempt portion represents the amount before the deduction of specific reserve for possible losses on loans, reserve for possible losses on loans to restructuring countries
and partial direct write-offs, calculated using the standardized approach for business units and asset classes that are immaterial for the purpose of calculating credit riskweighted assets.
2. “Others” include deposits, call loans, other debt purchased, money held in trust, foreign exchange assets, other assets, etc.

Status of Reserves for Possible Losses on Loans
The amounts associated with regarded-method exposure and securitization exposure are excluded.
(F) Fiscal Year-end Balances of Reserves for Possible Losses on Loans and Changes during the Fiscal Year (after Partial Direct Write-offs)(Billions of yen)

General reserve for possible losses on loans

Specific reserve for possible losses on loans

Reserve for possible losses on loans to restructuring
countries
Total

Beginning balance
Increase during the fiscal year
Decrease during the fiscal year
Ending balance
Beginning balance
Increase during the fiscal year
Decrease during the fiscal year
Ending balance
Beginning balance
Increase during the fiscal year
Decrease during the fiscal year
Ending balance
Beginning balance
Increase during the fiscal year
Decrease during the fiscal year
Ending balance

As of, or for the fiscal year ended,
March 31, 2017¥304.8
344.7
304.8
344.7
154.6
164.4
154.6
164.4
0.0
0.0
0.0
0.0
¥459.5
509.1
459.5
509.1

Note: General reserve for possible losses on loans in the above table represents the amount recorded in our consolidated balance sheet, and the amounts associated with regardedmethod exposure and securitization exposure are not excluded.

296

Status of Exposure Past Due Three Months or More or in Default、Status of Reserves for Possible Losses on Loans

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(G) Specific Reserve for Possible Losses on Loans by Geographical Area and Industry(Billions of yen)

As of March 31, 2017
¥105.0
36.4
0.8
1.9
12.6
33.4
0.5
14.1
4.8
49.2
10.1
¥164.4

Domestic
Manufacturing
Construction
Real estate
Service industries
Wholesale and retail
Finance and insurance
Individuals
Other industries
Overseas
Exempt portion
Total

As of March 31, 2016
¥96.2
27.2
3.1
2.3
11.5
28.8
0.6
17.3
5.0
49.1
9.3
¥154.6

Change
¥8.7
9.2
(2.3)
(0.3)
1.1
4.5
(0.0)
(3.2)
(0.1)
0.0
0.8
¥9.7

Note: Exempt portion represents the amount calculated using the standardized approach for business units and asset classes that are immaterial for purposes of calculating credit riskweighted assets.

(H) Write-offs of Loans by Industry(Billions of yen)

For the fiscal year ended March 31, 2017
¥0.9
0.3
0.2
2.3
3.1
4.4
4.2
0.1
¥15.8

Manufacturing
Construction
Real estate
Service industries
Wholesale and retail
Finance and insurance
Individuals
Other industries
Exempt portion
Total

Notes: 1. The above table represents the breakdown of losses on write-offs of loans recorded in our consolidated statement of income after excluding the amounts associated withregarded-method exposure and securitization exposure.
2. Exempt portion represents the amount calculated using the standardized approach for business units and asset classes that are immaterial for purposes of calculating credit
risk-weighted assets.
3. "Other industries" include overseas and non-Japanese resident portions.

Status of Exposure to which the Standardized Approach is Applied(I) Exposure by Risk Weight Category after Applying Credit Risk Mitigation(Billions of yen)

As of March 31, 2017

Risk weight

Total

0%
10%
20%
35%
50%
100%
150%
250%
350%
625%
937.5%
1,250%

On-balance sheet¥10,729.6
179.8
1,337.2
42.4
1,894.8
0.0
48.9¥14,233.1

Off-balance sheet¥1,522.4
511.1
55.8
1,186.8
0.0
0.0
0.0¥3,276.3

Total¥12,252.1
179.8
1,848.4
98.3
3,081.6
0.0
48.9
0.0
0.0
0.0
¥17,509.4

With external rating
¥50.0
63.5
22.0
122.9
¥258.4

Notes: 1. The amounts in the above table are before the deduction of specific reserve for possible losses on loans, reserve for possible losses on loans to restructuring countries andpartial direct write-offs.
2. Off-balance-sheet exposure shows credit equivalent amount.

(J) Amount of Exposure to which a Risk Weight of 1,250% is Applied(Billions of yen)Amount of exposure to which a risk weight of 1,250% is applied

As of March 31, 2017
¥0.2

297

Status of Reserves for Possible Losses on Loans、Status of Exposure to which the Standardized Approach is Applied

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Status of Exposure to which the Internal Ratings-based Approach is Applied(K) Specialized Lending Exposure under Supervisory Slotting Criteria by Risk Weight Category(Billions of yen)

Risk weight

As of March 31, 2017
¥0.0
13.4
3.8
87.6
4.5
8.0
15.2
17.0
15.5
¥165.6

50%
70%
90%
95%
115%
120%
140%
250%
Default

Total(L) Equity Exposure under Simple Risk Weight Method of Market-based Approach by Risk Weight Category(Billions of yen)

Risk weight

As of March 31, 2017
¥737.555.6¥793.1

300%
400%

Total

Note: Of the equity exposure under the simple risk weight method, a risk weight of 300% is applied for listed equities and 400% for unlisted equities.

(M) Portfolio by Asset Class and Ratings Segment (Corporate, etc.)(Billions of yen, except percentages)

Corporate
Investment grade zone
Non-investment
grade zone
Default
Sovereign
Investment grade zone
Non-investment
grade zone
Default
Bank
Investment grade zone
Non-investment
grade zone
Default
Equity exposure under
PD/LGD approach
Investment grade zone
Non-investment
grade zone
Default
Total
Investment grade zone
Non-investment
grade zone
Default

As of March 31, 2017
Risk
weight(EAD
Onweighted
balanceaverage)
sheet
(%)
EAD
36.73 ¥78,222.1¥56,571.6
26.08
55,538.0
37,788.8PD(EAD
weighted
average)
(%)
1.76
0.09

LGD
(EAD
weighted
average)
(%)
36.17
37.82

EL
default(EAD
weighted
average)
(%)
/
/

1.49

31.95

/

64.06

21,680.0

100.00
0.01
0.00

35.87
37.96
37.96

33.22
/
/

35.12
1.27
1.16

0.94

37.82

/

100.00
0.16
0.08

28.51
37.28
37.30

0.59

Offbalance
sheet¥21,650.4
17,749.1

Amountofundrawn
commitments¥22,184.7
18,464.6

Weighted
average ofcreditconversion
factor
(%)
74.99
74.99

17,927.0

3,752.9

3,563.4

75.00

1,004.080,314.2
80,165.1

855.7
67,492.6
67,353.7

148.2
12,821.5
12,811.4

156.6
816.3
806.8

75.00
75.00
75.00

63.75

149.0

138.8

10.1

9.4

75.00

25.45
/
/

40.51
23.23
19.41

0.0
5,921.5
5,337.6

0.0
4,231.3
3,764.5

1,690.2
1,573.0

734.3
643.6

75.00
75.00

36.96

/

58.25

582.4

465.3

117.1

90.6

75.00

100.00

96.75

94.52

29.55

1.4

1.4

-

-

-

2.28

90.00

/

145.16

4,180.1

4,064.4

115.7

-

-

0.07

90.00

/

112.903,788.9

3,673.2

115.7

-

-

240.10

301.9

301.9

-

-

-

1,192.50
89.3
89.3
22.06 ¥168,638.0 ¥132,360.1
14.31 144,829.7
112,580.3¥36,277.9
32,249.4¥23,735.3
19,915.1

74.99
74.99

1.10

90.00

/

100.00
0.88
0.04

90.00
38.40
39.24

/
/
/

1.46

32.89

/

66.25

22,713.3

18,833.1

3,880.2

3,663.5

75.00

100.00

40.37

33.31

129.54

1,094.9

946.6

148.2

156.6

75.00

Notes: 1. Investment grade zone includes obligor ratings A1 through B2, non-investment grade zone includes C1 through E2 (excluding E2R), and default includes E2R through H1.
2. "Corporate" does not include specialized lending exposure under supervisory slotting criteria.
3. Each asset class includes purchased receivables.
4. The commitments that can be terminated at any time without condition or terminated automatically are not included in the amount of undrawn commitments and weighted
average of credit conversion factor.
5. Regarding equity exposure under the PD/LGD approach, we recognize the risk-weighted assets by multiplying 1,250% by the expected loss ("EL").

298

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy(N) Portfolio by Asset Class and Ratings Segment (Retail)(Billions of yen, except percentages)

Residential
mortgage
Non-default
Default
Qualifying revolving
loan (retail)Non-default
Default
Other retailNon-default
Default
Total
Non-default
Default

As of March 31, 2017
Risk
weight(EAD
Onweighted
EADbalanceaverage)(Billions
sheet(%)
of yen)PD(EAD
weighted
average)
(%)

LGD
(EAD
weighted
average)(%)

EL
default(EAD
weighted
average)
(%)

1.61

41.29

/

32.98

¥9,388.0¥9,258.2¥129.8

¥9.1

75.00

0.76
100.00

41.24
47.30

/
44.25

32.92
40.27

9,307.8
80.2

9,179.6
78.6

128.2
1.5

9.1
-

75.00
-

3.25

76.82

/

66.05

629.2

414.9

214.2

1,715.6

12.49

3.14
100.004.50
1.66
100.002.22
1.04
100.00

76.83
71.62
49.02
49.12
45.71
44.52
44.49
46.72

/
66.53
/
/
42.54
/
/
43.61

66.05
67.40
46.43
46.56
41.92
37.12
37.07
41.14

628.4
0.7
2,218.2
2,154.0
64.2¥12,235.5
12,090.3
145.2

414.4
0.5
2,204.2
2,143.4
60.7¥11,877.4
11,737.5
139.9

214.0
0.1
14.0
10.5
3.4
¥358.0352.8
5.2

1,714.1
1.5
16.4
12.7
3.6
¥1,741.2
1,736.0
5.2

12.49
12.84
65.02
56.80
93.64
13.31
13.14
69.86

Weighted
Amount of average of
Offcredit
undrawnbalancecommit- conversion
sheet
ments factor (%)

Notes: 1. Each asset class includes purchased receivables.
2. The commitments that can be terminated at any time without condition or terminated automatically are not included in the amount of undrawn commitments and weighted
average of credit conversion factor.

(O) Actual Losses by Asset Class(Billions of yen)

Corporate
SovereignBank
Residential mortgage
Qualifying revolving loan (retail)
Other retailTotal

For the period from April 1,2016 through March 31, 2017
Actual losses¥(2.8)
0
(0.2)
(0.6)
0.5
(1.6)
¥(4.9)

Note: Actual losses are the sum of the net increase (decrease) in the amount of partial direct write-offs, specific reserve for possible losses on loans and general reserve for possible
losses on loans (for claims against special attention obligors or below), etc., as well as tax-qualified direct write-offs, losses from sales of non-performing loans, losses from debt
forgiveness and losses from debt-equity swaps during the relevant period. Equity exposure under the PD/LGD approach is not included in the amount of actual losses.

(P) Comparison of Estimated and Actual Losses by Asset Class(Billions of yen)

Corporate
SovereignBank
Residential mortgage
Qualifying revolving loan (retail)
Other retailTotal

For the period from April 1, 2007
through March 31, 2008
Estimated losses
Actual losses(expected losses as ofMarch 31, 2007)
After
deductionof reserves¥1,086.0¥217.0
¥74.6
5.4
(7.0)
0.0
6.4
2.6
(2.6)
78.2
6.8
5.1
7.2
2.3
(0.1)
52.9
8.8
(2.8)
¥1,236.5¥230.5¥74.1

299

Status of Exposure to which the Internal Ratings-based Approach is Applied

For the period from April 1, 2008
through March 31, 2009
Estimated losses
Actual losses(expected losses as ofMarch 31, 2008)
After
deductionof reserves¥1,121.0¥350.0¥345.3
1.3(11.1)
0.0
2.9
2.5
28.6
86.6
22.7
17.2
7.9
3.2
2.1
51.9
16.4
3.8
¥1,271.8¥383.9¥397.32018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(Billions of yen)

Corporate
SovereignBank
Residential mortgage
Qualifying revolving loan (retail)
Other retailTotal

For the period from April 1, 2009
through March 31, 2010
Estimated losses (expected
Actual losses
losses as of March 31, 2009)After
deductionof reserves¥1,313.1¥473.3¥166.5
1.7(10.8)
0.3
35.5
6.5
1.0
95.8
24.8
33.2
10.3
3.8
0.2
51.3
15.6
4.3
¥1,508.0¥513.3¥205.8For the period from April 1, 2010
through March 31, 2011
Estimated losses (expected
Actual losses
losses as of March 31, 2010)
After
deductionof reserves¥1,296.9¥454.0¥22.9
1.5(11.4)
0.2
38.4
8.3
(0.4)
122.6
31.1
31.5
10.2
3.5
1.4
51.2
15.0
23.1
¥1,521.1¥500.6¥78.7

For the period from April 1, 2012
through March 31, 2013
Estimated losses (expected
Actual losses
losses as of March 31, 2012)

Corporate
SovereignBank
Residential mortgage
Qualifying revolving loan (retail)
Other retailTotal

For the period from April 1, 2011
through March 31, 2012
Estimated losses (expected
Actual losses
losses as of March 31, 2011)
After
deductionof reserves¥989.6¥373.2¥29.2
1.3(11.7)
0.2
31.9
4.1
(1.4)
150.4
43.2
(2.9)
12.2
4.2
(0.7)
74.7
24.1
5.2
¥1,260.3¥437.2¥29.5

Corporate
SovereignBank
Residential mortgage
Qualifying revolving loan (retail)
Other retailTotal

For the period from April 1, 2013
through March 31, 2014
Estimated losses (expected
Actual losses
losses as of March 31, 2013)
After
deductionof reserves¥785.1¥246.9¥(41.2)
1.7(11.9)(13.5)
12.5
6.4
(1.2)
123.7
50.5
(3.2)
11.2
3.9
0.4
69.1
26.2
1.4
¥1,003.5¥322.3¥(57.4)

For the period from April 1, 2014
through March 31, 2015
Estimated losses (expected
Actual losses
losses as of March 31, 2014)
After
deductionof reserves¥596.0¥195.5¥128.1
1.5
1.5
0.0
10.3
5.6
(1.2)
104.8
46.1
(0.7)
11.5
3.8
2.2
61.9
23.8
5.1
¥786.3¥276.6¥133.6

Corporate
SovereignBank
Residential mortgage
Qualifying revolving loan (retail)
Other retailTotal

For the period from April 1, 2015
through March 31, 2016
Estimated losses (expected
Actual losses
losses as of March 31, 2015)
After
deductionof reserves¥607.1¥128.9
¥24.8
1.6
1.5
0
7.3
3.9
(0.5)
80.4
31.2
(6.0)
12.3
2.4
0.4
54.3
15.1
(1.2)
¥763.2¥183.3¥17.4

For the period from April 1, 2016
through March 31, 2017
Actual losses
Estimated losses (expected
losses as of March 31, 2016)
After
deductionof reserves¥483.4¥117.6¥(2.8)
1.8
1.7
0
5.5
3.6
(0.2)
71.5
34.2
(0.6)
13.6
3.3
0.5
47.8
16.5
(1.6)
¥623.8¥177.2¥(4.9)(Billions of yen)

Afterdeductionof reserves¥828.0
3.1
18.4
134.8
10.8
73.5
¥1,068.8¥272.6(10.2)
6.3
41.6
3.7
24.2
¥338.4

¥75.6
0.2
(5.0)
(9.2)
0.3
0.2
¥62.1
(Billions of yen)(Billions of yen)

Notes: 1. Estimated losses after deduction of reserve are the amount after deductions of partial direct write-offs, specific reserves for possible losses on loans and general reserves forpossible losses on loans (for claims against special attention obligors or below), etc., as of the beginning of each period. Equity exposure under the PD/LGD approach is notincluded in the amount of estimated losses.
2. Actual losses are the sum of the net increase (decrease) in the amount of partial direct write-offs, specific reserves for possible losses on loans and general reserves forpossible losses on loans (for claims against special attention obligors or below), etc., as well as tax-qualified direct write-offs, losses from sales of non-performing loans,losses from debt forgiveness and losses from debt-equity swaps during the relevant period. Equity exposure under the PD/LGD approach is not included in the amount of
actual losses.

300

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy□ Methods for Credit Risk Mitigation(3) Credit Risk Mitigation by Portfolio Classification
The amounts of exposure to which the method of credit risk mitigation through collateral and guarantees is applied are as
follows:(Billions of yen)

As of March 31, 2017

Internal ratings-based approach
Corporate
SovereignBank
RetailResidential mortgage
Qualifying revolving loan
Other retail
OthersStandardized approach
Sovereign
Bank
Corporate
Residential mortgage
Securitizations
Others
Total

Financialcollateral¥806.3
740.9
8.5
33.3
23.4
23.4
124.5
100.0
14.0
10.5
¥930.8Other collateral¥5,045.9
4,670.6
8.3
99.6
267.2
267.2
/
/
/
/
/
/
/
¥5,045.9

Guarantees¥8,429.4
7,412.7
369.9
82.3
564.4
122.5
0.1
441.7
163.4
163.4
¥8,592.9

Creditderivatives
¥11.7
11.7
¥11.7

Total
¥14,293.4
12,836.0
386.8
215.3
855.1
122.5
0.1
732.4
287.9
263.4
14.0
10.5
¥14,581.4□ Counterparty Risk in Derivatives Transactions and Long-settlement Transactions(4) Status of Counterparty Risk in Derivatives Transactions and Long-settlement Transactions(A) Status of Derivatives Transactions and Long-settlement Transactions

Derivative Transactions(Billions of yen)

As of March 31, 2017
Gross
Gross Credit equivalent
replacement cost
add-onamountCurrent exposure method
Foreign exchange-related transactions
Interest rate-related transactions
Gold-related transactions
Equity-related transactions
Transactions related to precious metals (other than gold)
Other commodity-related transactions
Credit derivatives transactions
Subtotal
Netting benefits by close-out netting settlement contracts
Subtotal
Effect of credit risk mitigation by collateral
Total
Standardized method
Total
Expected positive exposure method
Total

(A)
(B)
(C)=(A)+(B)(D)(C)+(D)¥139.7
156.5
36.6
33.1
527.4
2.4
895.9
/
/
/
/

¥95.7
61.8
130.4
73.7
1,160.5
8.1
1,530.4////¥235.4
218.3
167.0
106.8
1,688.0
10.6
2,426.4
1,154.2
1,272.1
298.6¥973.5Credit equivalentamount¥16.3

301

Methods for Credit Risk Mitigation、Counterparty Risk in Derivatives Transactions and Long-settlement Transactions¥2,386.1

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Long-settlement Transactions(Billions of yen)

As of March 31, 2017
Gross
Gross Credit equivalent
replacement cost
add-onamount
¥26.8
¥5.9
¥32.8

Long-settlement transactions

Notes: 1. The current exposure method is used as the method to calculate credit equivalent amounts.
2. Neither the "netting benefits by close-out netting settlement contracts" nor the "effect of credit risk mitigation by collateral" applies to long-settlement transactions.

(B) Amounts of Credit Risk Mitigation by Type(Billions of yen)

As of March 31, 2017
¥23.7
31.1
11.7
¥66.7

Financial collateral
Other collateral
Guarantees, others
Total(C) Notional Amount of Credit Derivatives Subject to Credit Equivalent Amount Calculations(Billions of yen)

As of March 31, 2017
Notional amountCredit derivatives type:
Credit default swap
Total return swap
Total

Protection bought
Protection soldProtection bought
Protection soldProtection bought
Protection sold

¥1,708.2
1,803.0¥1,708.2
1,803.0

Note: Credit derivatives used for credit risk mitigation are as follows:(Billions of yen)

As of March 31, 2017
¥20.0

Credit derivatives used for credit risk mitigation□ Securitization Exposures(5) Quantitative Disclosure Items for Securitization Exposures

Securitization Exposures as Originator (for Calculation of Credit Risk-weighted Assets)(A) Information by Type of Underlying Assets(Billions of yen)

As of, or for the fiscal year ended, March 31, 2017
Residential
Lease
SecuritiAuto
CorpoReal
payment
zationCredit mortgage
loans receivables
rate
estate products
loans
cards
Traditional securitizations
Amount of underlying assets (a)Default exposure
Losses during the fiscal year
Amount of exposures securitized during the fiscal year
Gains and losses recognized on sales during the
fiscal year
Securitization subject to early amortization treatment
Synthetic securitizations
Amount of underlying assets (b)Default exposure
Losses during the fiscal year
Amount of exposures securitized during the fiscal year
Total amount of underlying assets (a)+(b)

Total

¥-

¥48.1
0.2
-

¥-

¥-

¥-

¥-

¥-

¥48.1
0.2
-

-

-

-

-

-

-

-

-

-

-

-

-

280.9
277.4

-

-

280.9
277.4

¥-

¥48.1

¥-

¥-

¥280.9¥-¥-¥329.1

Notes: 1. Items that refer to "during the fiscal year" show amounts accumulated during the fiscal year ended March 31, and 2017.
2. "Amount of underlying assets" and "Losses during the fiscal year" include those related to, in addition to exposure originated by us, exposure to assets originated by otherfinancial institutions if they are contained in the same securitization program.
3. Classification based on type of underlying assets is conducted according to the principal underlying asset type for each transaction.
4. "Credit cards" include shopping credit receivables, card loans, etc.
5. The effects of risk mitigation, in the context of calculating capital adequacy ratio, of transfers (hedges) of risk through synthetic securitization transactions are reflected in"Required capital" of "(B) Information of securitization exposure retained or purchased."

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Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

─Exposure Intended to be Securitized─
(Billions of yen)

Exposure intended to be securitized

Creditcards¥-

Residential
mortgageloans¥-

As of March 31, 2017
Lease
Auto
Corpopayment
loans receivables
rate
¥¥¥-

Real
estate¥-Securitization
products
¥-

Total
¥-

(B) Information of Securitization Exposure Retained or Purchased
─Exposure by Type of Underlying Asset─
(Billions of yen)On-balance sheet
Exposure on resecuritizations
Off-balance sheet
Exposure on resecuritizations
Total
Exposure on resecuritizations
Exposure on securitizations to which a risk weightof 1,250% is applied
Exposure whose underlying assets are overseas assets

As of March 31, 2017
Lease
Auto
Corpopayment
loans receivables
rate¥¥¥280.9¥¥¥280.9-

Creditcards¥¥-

Residential
mortgage
loans
¥0
¥0
-

-

0

-

-

-

-

-

-

Real
estate¥¥-Securitization
products¥¥-

Total¥280.9¥280.9
-

0.6

-

-

0.6

-

-

-

-

Notes: 1. Classification based on type of underlying asset is conducted according to the principal underlying asset type for each transaction.
2. "Credit cards" include shopping credit receivables, card loans, etc.
3. "Exposure whose underlying assets are overseas assets" is classified based on the principal underlying asset type for each transaction.
4. "Exposure on resecuritizations" as of March 31, 2017 is classified following Article 1, Paragraph 2-2 of the FSA Notice No. 20 (hereinafter the same).

─Exposure by Risk Weight Category─(Billions of yen)

As of March 31, 2017

Risk
weightUp to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Less than 1,250%
1,250%

Total

On-balance
Exposure on
sheet resecuritizations¥267.4
¥1.7
11.1
0.6
¥280.9¥-Off-balance
Exposure on
sheet resecuritizations¥¥¥¥-

Exposure on
Total resecuritizations¥267.4
¥1.7
11.1
0.6
¥280.9¥-

─Amount of Required Capital by Risk Weight Category─(Billions of yen)

As of March 31, 2017

Risk
weightTotal

Up to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Less than 1,250%
1,250%

Exposure on
On-balance
sheet resecuritizations
¥1.5
¥0.2
0.7
¥2.6
¥-

303

Quantitative Disclosure Items for Securitization Exposure

Exposure on
Off-balance
sheet resecuritizations¥¥¥¥-

Exposure on
Total resecuritizations
¥1.5
¥0.2
0.7
¥2.6
¥-

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

─Credit Risk Mitigation against Exposure on Resecuritizations─(Billions of yen)RiskweightAs of March 31, 2017¥¥-

Up to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Over 650%

Total

Note: The above table shows the exposure on resecuritizations based on the risk weight after taking into consideration the effect of method to mitigate credit risk.

─Capital Increase Due to Securitization Transactions─(Billions of yen)

Capital increase due tosecuritization transactions

Creditcards

Residential
mortgage
loans

¥-

¥-

As of March 31, 2017
Lease
Auto
payment
loans receivables Corporate
¥-

¥-

¥-

Real
estateSecuritization
products

Total

¥-

¥-

¥-

Securitization Exposure as Sponsor of Securitization Programs (ABCP/ABL) (for Calculation of Credit Risk-weighted Assets)(C) Information by Type of Underlying Assets(Billions of yen)Amount of underlying assets
Default exposure
Estimated loss amount related tounderlying assets during the fiscal year
Amount of exposures securitized
during the fiscal year

Credit
cards
¥43.3
1.6

As of, or for the fiscal year ended, March 31, 2017
Residential
Lease
Account
mortgageAutopayment
and noteReal
loans
loans receiv-ables receiv-ables
estate¥¥74.4¥31.9¥307.5
¥4.9
0.8
0.5
5.8
-

¥394.0¥-¥814.3¥753.7¥2,512.4¥-

Others
¥43.3
0.7

Total
¥500.64.9
9.6¥680.3¥5,154.9

Notes: 1. Items that refer to "during the fiscal year" show amounts accumulated during the fiscal year ended March 31, 2017.
2. Securitization exposure that is acquired in securitization of customer’s claims other than as sponsor (in the form of asset-backed securities, trust beneficiary rights and othertransferable instruments) is categorized as securitization exposure as investor.
3. The amount of default exposure is the amount of the underlying assets recognized as default in the calculation of capital adequacy ratio.
4. Estimated loss amount related to underlying assets is based on the amount of the underlying assets as of the relevant date and the following parameters that are used in thecalculation of capital adequacy ratio:･ parameters used in the calculation of required capital for an underlying asset when applying the supervisory formula (e.g., PD); and･ with respect to underlying assets classified as securitization exposure, the conservative application of risk weights used in the ratings-based approach.
5. Classification based on type of underlying assets is conducted according to the principal underlying asset type for each transaction. Transactions that are difficult to classify
are included under "Others."
6. "Credit cards" include shopping credit receivables, card loans, etc.

(D) Information of Securitization Exposure Retained or Purchased
─Exposure by Type of Underlying Asset─
(Billions of yen)On-balance sheet
Exposure on resecuritizations
Off-balance sheet
Exposure on resecuritizations
Total
Exposure on resecuritizations
Exposure on securitizations towhich a risk weight of 1,250% isapplied
Exposure whose underlying
assets are overseas assets

Credit
cards
¥17.8
136.3
¥154.2-

Residential
mortgage
loans
¥¥-

Auto
loans
¥62.7
0.1
¥62.9
-

98.2

-

-

As of March 31, 2017
Lease
Account
payment
and note
receivables receivables¥30.1¥296.354.0¥30.1¥350.4
-

18.0

153.0

Real
estate¥¥-Others
¥43.3
27.6
¥71.0
-

Total
¥450.6218.2¥668.8
-

-

58.3

327.7

Notes: 1. Securitization exposure retained or purchased includes unused portions of securitization programs that are subject to allocation of required capital.
2. Classification based on type of underlying assets is conducted according to the principal underlying asset type for each transaction. Transactions that are difficult to classify
are included under "Others."
3. Credit cards" include shopping credit receivables, card loans, etc.
4. The classification of transactions of which the underlying assets are overseas assets is conducted according to the principal underlying assets of each transaction.
5. "Exposure on resecuritizations" as of March 31, 2017 is classified following Article 1, Paragraph 2-2 of the FSA Notice No. 20 (hereinafter the same).

304

Quantitative Disclosure Items for Securitization Exposure、Securitization exposure as sponsor of securitization programs (ABCP/ABL) (forcalculation of credit risk-weighted assets)2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

─Exposure by Risk Weight Category─(Billions of yen)

As of March 31, 2017

Risk
weightUp to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Less than 1,250%
1,250%

Total

On-balance
sheet¥434.914.0
1.6¥450.6

Exposure on
resecuritizations¥¥-

Off-balancesheet¥218.2¥218.2

Exposure on
resecuritizations
¥¥-

Total
¥653.114.0
1.6¥668.8

Exposure on
resecuritizations¥¥-

─Amount of Required Capital by Risk Weight Category─(Billions of yen)

As of March 31, 2017

Risk
weightUp to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Less than 1,250%
1,250%

Total

Onbalance sheet
¥2.7
0.2
0.1
¥3.1

Exposure on
resecuritizations¥¥-

Exposure on
resecuritizations¥¥-

Off-balance
sheet
¥1.4
¥1.4

Total
¥4.1
0.2
0.1
¥4.5

Exposure on
resecuritizations¥¥-

─Credit Risk Mitigation against Exposure on Resecuritizations─(Billions of yen)RiskweightAs of March 31, 2017¥¥-

Up to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Over 650%

Total

Note: The above table shows the exposure on resecuritizations based on the risk weight after taking into consideration the effect of method to mitigate credit risk.

Securitization Exposure as Investor (for Calculation of Credit Risk-weighted Assets)(E) Information of Securitization Exposure Retained or Ourchased
─Exposure by Type of Underlying Asset─
(Billions of yen)On-balance sheet
Exposure on resecuritizations
Off-balance sheet
Exposure on resecuritizations
Total
Exposure on resecuritizations
Exposure on securitizations towhich a risk weight of 1,250% isapplied
Exposure whose underlying
assets are overseas assets

As of March 31, 2017
Lease
payment
receivables Corporate¥333.5¥425.4130.1
161.6¥463.7¥587.1-Creditcards¥145.032.0¥177.1-

Residential
mortgageloans¥818.90.0¥818.9
0.0

Auto
loans
¥725.6
97.2¥822.8
-

-

0.0

-

-

161.3

0.0

819.9

462.8

Real
estate
¥6.5
0.1
¥6.6
-

Others¥195.3
2.3¥197.6-

Total¥2,650.4
0.0
423.6¥3,074.1
0.0

-

0.2

-

0.2

587.1

0.1

163.3

2,194.8

Notes: 1. Classification based on type of underlying assets is conducted according to the principal underlying asset type for each transaction. Transactions that are difficult to classify
are included under "Others."
2. "Credit cards" include shopping credit receivables, card loans, etc.
3. The classification of transactions of which the underlying assets are overseas assets is conducted according to the principal underlying assets of each transaction.
4. "Exposure on resecuritizations" as of March 31, 2017 is classified following Article 1, Paragraph 2-2 of the FSA Notice No. 20 (hereinafter the same).

305

Securitization exposure as sponsor of securitization programs (ABCP/ABL) (for calculation of credit risk-weighted assets)、Securitization
exposure as investor (for calculation of credit risk-weighted assets)2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

─Exposure by Risk Weight Category─(Billions of yen)

As of March 31, 2017

Risk
weightUp to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Less than 1,250%
1,250%

Total

On-balance
sheet¥2,593.7
44.8
8.3
3.3
0.0

Exposure on
resecuritizations¥0.0-

Off-balance
sheet¥421.1
1.7
0.5
0.1

Exposure on
resecuritizations
¥-

Total
¥3,014.9
44.8
10.1
3.9
0.2

Exposure on
resecuritizations¥0.0-¥2,650.4¥0.0¥423.6¥-¥3,074.1¥0.0

─Amount of Required Capital by Risk Weight Category─(Billions of yen)

As of March 31, 2017

Risk
weightUp to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Less than 1,250%
1,250%

Total

On-balance
sheet
¥14.9
0.9
0.6
0.9
0.0

Exposure on
resecuritizations¥0.0-

Off-balance
sheet
¥3.3
0.1
0.1
0.1

Exposure on
resecuritizations
¥-

Total
¥18.2
0.9
0.8
1.1
0.2

Exposure on
resecuritizations
¥0.0
-

¥17.5

¥0.0

¥3.7

¥-

¥21.3

¥0.0

─Credit Risk Mitigation against Exposure on Resecuritizations─(Billions of yen)

As of March 31, 2017

Risk
weightUp to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Over 650%

Total

¥¥-

Note: The above table shows the exposure on resecuritizations based on the risk weight after taking into consideration the effect of method to mitigate credit risk.

Securitization Exposure as Originator (for Calculation of Market Risk Equivalent Amounts)(F) Information by Type of Underlying Assets
None as of March 31, 2017(G) Information of Securitization Exposure Retained or Purchased
None as of March 31, 2017

306

Securitization exposure as investor (for calculation of credit risk-weighted assets)、Securitization exposure as originator (for calculationof market risk equivalent amounts)

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy

Securitization Exposure as Sponsor of Securitization Programs (ABCP/ABL) (for Calculation of Market Risk
Equivalent Amounts)(H) Information by Type of Underlying Assets
None as of March 31, 2017(I) Information of Securitization Exposure Retained or Purchased
None as of March 31, 2017

Securitization Exposure as Investor (for Calculation of Market Risk Equivalent Amounts)(J) Information of Securitization Exposure Retained or Purchased
─Exposure by Type of Underlying Asset─
(Billions of yen)

As of March 31, 2017
CreditCards

Residential
mortgage
loans

Auto
loans

¥0.0

¥3.7

¥13.8

¥0.6

-

-

-

-

-

-

Exposure on resecuritizations

-

-

Total
Exposure on resecuritizations
Exposure on securitizations to which
a risk weight of 100% is applied
Exposure whose underlying
assets are overseas assets¥0.0-

On-balance sheet
Exposure on resecuritizations
Off-balance sheet

Lease
payment
receivables CorporateRealestateOthers

Total

¥0.0

¥3.0

¥7.0

¥28.4

-

-

-

0.0

0.0

-

-

-

-

-

-

-

-

-

-

-

¥3.7
-

¥13.8
-

¥0.6
-

¥0.0
-

¥3.0
-

¥7.0
0.0

¥28.4
0.0

-

3.6

0.4

-

0.0

-

0.3

4.4

-

3.5

13.8

0.6

0.0

3.0

7.0

28.2

Notes: 1. Classification based on type of underlying assets is conducted according to the principal underlying asset type for each transaction. Transactions that are difficult to classify
are included under "Others."
2. "Credit cards" include shopping credit receivables, card loans, etc.
3. The classification of transactions of which the underlying assets are overseas assets is conducted according to the principal underlying assets of each transaction.
4. "Exposure on resecuritizations" are classified following Article 1, Paragraph 2-2 of the FSA Notice No. 20 (hereinafter the same).

307

Securitization exposure as sponsor of securitization programs (ABCP/ABL) (for calculation of market risk equivalent amounts)、Securitization
exposure as investor (for calculation of market risk equivalent amounts)

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

─Exposure by Risk Capital Charge Category─(Billions of yen)

As of March 31, 2017

Risk
capitalchargeUp to 1.6%
Up to 4%Up to 8%Up to 20%
Up to 52%
Less than100%
100%

Total

On-balance
Exposure on
sheet resecuritizations
¥20.5
¥2.4
1.0
4.4
0.0
¥28.4
¥0.0

Off-balance
Exposure on
sheet resecuritizations¥¥¥¥-

Exposure on
Total resecuritizations
¥20.5
¥2.4
1.0
4.4
0.0
¥28.4
¥0.0

─Amount of Required Capital by Risk Capital Charge Category─(Billions of yen)

As of March 31, 2017

Risk
capitalchargeTotal

Up to 1.6%
Up to 4%Up to 8%Up to 20%
Up to 52%
Less than 100%100%On-balance
Exposure on
sheet resecuritizations
¥0.3
¥0.1
0.2
4.4
0.0
¥5.2
¥0.0

Off-balance
Exposure on
sheet resecuritizations¥¥¥¥-

Exposure on
Total resecuritizations
¥0.3
¥0.1
0.2
4.4
0.0
¥5.2
¥0.0

─Subject to Comprehensive Risk Measure─(Billions of yen)

Total amount of securitization exposure
Total amount of required capital

As of March 31, 2017
Resecuritiation
Securitization
¥¥¥¥-

308

Securitization exposure as investor (for calculation of market risk equivalent amounts)

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Mizuho Financial Group’s Consolidated Capital Adequacy□ Market Risk
(A) Market risk (VAR) and stressed VAR associated with trading activities for the fiscal year as of March 31, 2017.
The following table shows VAR (Value At Risk) figures of our trading activities:(Billions of yen)

End of period
Maximum
Minimum
Average
The number of cases where assumptive losses
exceeded VAR during the period

For the fiscal year
ended March 31,
2017
¥1.9
4.8
1.7
2.7
0

Notes:1. Amount of market risk (VAR) is calculated based on the internal model.
2. The multiplication factor for the calculation of market risk equivalent is determined by the number of cases where assumptive losses exceeded VAR before 250 business days
prior to the end of period.
3. Our group companies which conduct trading activities are Mizuho Bank, Mizuho Trust & Banking and Mizuho Securities, etc.

VAR method:
VAR:
Quantitative standard:

historical simulation method;
1. confidence interval: one-tailed 99.0%;
2. holding period: 1 day; and3. historical observation period of three years (801 business days)

The following table shows stressed VAR figures of our trading activities:(Billions of yen)

End of period
Maximum
Minimum
Average

For the fiscal year
ended March 31,
2017
¥5.3
8.9
2.8
5.2

Stressed VAR method:
Stressed VAR:
historical simulation method;
Quantitative standard: 1. confidence interval: one-tailed 99.0%;
2. holding period: 1 day; and3. historical observation period of one year of significant financial stress (265 business days)
Stressed VAR
The stressed VAR measurement is based on a continuous 12-month period of significant financial stress.

(B) Outlier criteria
The following table shows results of calculations under the outlier framework based on previous outlier criteria:(Billions of yen)

As of March 31, 2017

Amount of loss
¥361.2

Broadly-defined
capital¥10,050.9

Loss ratio
to capital
3.5%

Interest rate shock scenario under stress conditions in outlier criteria
For the interest rate shock scenario used in connection with the calculations under the outlier framework, we generateannual rate fluctuation data for five years derived from daily raw historical interest rate data of the past six years and thenapply the actual fluctuation data at a 99.0% confidence level to the shock scenario.

309

Market Risk

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）□ Equity Exposures in Banking Book
(6) Status of Equity Exposures in Banking Book
(A) Amounts Stated in Consolidated Balance Sheet(Billions of yen)

As of March 31, 2017
Consolidated balance sheet amount¥3,857.0
400.3¥4,257.4

Exposure of listed stock, etc.
Other equity exposure
Total

Fair value¥4,031.5//

Note: The above figures include only Japanese and foreign stocks.

(B) Gains and Losses on Sales Related to Equity Exposure(Billions of yen)

For the Fiscal year ended March 31, 2017
Gains and losses
on salesGains on sales¥261.1¥295.8

Sale of equity exposure

Losses on sales¥34.7

Note: The above figures represent gains and losses on sales of stocks in our consolidated statement of income.

(C) Gains and Losses from Write-offs Related to Equity Exposure(Billions of yen)

For the Fiscal year ended March 31, 2017
Gains and losses fromwrite-offs¥(4.8)

Write-offs of equity exposure

Note:The above figures represent gains and losses on devaluation of stocks in our consolidated statement of income.

(D) Unrealized Gains and Losses Recognized in the Consolidated Balance Sheet and not Recognized in theConsolidated Statement of Income(Billions of yen)

As of March 31, 2017
Net unrealized gains
Equity exposure¥1,971.2

Unrealized gains¥2,017.1

Unrealized losses¥45.9

Note: The above figures include only Japanese and foreign stocks.

(E) Unrealized Gains and Losses not Recognized in the Consolidated Balance Sheet or in the Consolidated
Statement of Income(Billions of yen)

As of March 31, 2017
Net
Equity exposure¥174.5

Unrealized gains¥182.8

Unrealized losses¥8.3

Note: The above figures include only Japanese and foreign stocks.

(F) Equities Exposure by Portfolio Classification(Billions of yen)

PD/LGD approach
Market-based approach (simple risk weight method)
Market-based approach (internal models approach)
Total

As of March 31, 2017
¥4,180.1
793.1¥4,973.3

310

Equity Exposures in Banking Book

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Sound Management of Liquidity Risk

■Liquidity Coverage Ratio
The information disclosed herein is in accordance with "Matters Separately Prescribed by the Commissioner of the Financial
Services Agency Regarding Status of Sound Management of Liquidity Risk , etc. pursuant to Article 19-2, Paragraph 1, Item 5,
Sub-item (e) , etc. of the Ordinance for Enforcement of the Banking Law (the FSA Notice No. 7 of 2015).
(In million yen, the number of data)
Item

For the three months ended March 31, 2018

High-Quality Liquid Assets
1

Cash Outflows
2
3
4
5
6
7
8
9
10
11

(1)

Total high-quality liquid assets (HQLA)(2)Cash outflows related to unsecured retail fundingof which, Stable depositsof which, Less stable deposits
Cash outflows related to unsecured wholesalefundingof which, Qualifying operational deposits

For the three months ended December 31, 2017//¥60,159,630¥63,459,113

TOTAL UNWEIGHTEDVALUETOTAL WEIGHTEDVALUETOTAL UNWEIGHTEDVALUETOTAL WEIGHTED
VALUE

46,184,608

3,682,339

45,597,491

3,638,206

13,410,643

402,319

13,200,574

396,017

32,773,964

3,280,020

32,396,917

3,242,188

77,563,913

49,329,388

78,558,012

49,864,317

0

0

0

0

of which, Cash outflows related to unsecured
wholesale funding other than qualifying
operational deposits and debt securities

71,364,662

43,130,137

73,002,116

44,308,421

of which, Debt securities

6,199,250

6,199,250

5,555,895

5,555,895/

1,068,454/

1,129,409

24,249,235

7,064,688

24,764,396

7,077,369

2,315,235

2,315,235

2,368,843

2,368,843

21,922

21,922

23,706

23,706

Cash outflows related to secured funding, etc
Cash outflows related to derivative transactions,etc. funding programs, credit and liquidity facilitiesof which, Cash outflows related to derivatives
transactions, etc

12of which, Cash outflows related to funding
programs

13of which, Cash outflows related to credit andliquidity facilities

21,912,077

4,727,530

22,371,846

4,684,819

14

Cash outflows, etc. related to contractual funding
obligations

7,040,197

2,333,910

6,562,416

1,936,205

15

Cash outflows related to contingencies

77,792,015

696,424

78,261,200

695,46216

Total cash outflows/

64,175,205/

64,340,971

TOTAL UNWEIGHTEDVALUETOTAL WEIGHTEDVALUETOTAL UNWEIGHTEDVALUETOTAL WEIGHTED
VALUE

Cash Inflows

(3)

17

Cash inflows related to secured lending andinvestments, etc.

10,554,062

836,532

10,283,301

737,035

18

Cash inflows related to collections of loans, etc

14,863,687

11,012,718

14,205,103

10,755,503

19

Other cash inflows

7,515,036

2,246,878

7,092,196

2,040,250

20

Total cash inflows

32,932,786

14,096,129

31,580,601

13,532,789

Consolidated liquidity coverage ratio

(4)

/

/

21

Total HQLA allowed to be included in thecalculation/¥60,159,630/¥63,459,113

22

Net cash outflows/

50,079,075/

50,808,181

23

Consolidated liquidity coverage ratio/

120.1％/

124.8％

24

The number of data used to calculate the average
value

59

62

Notes: 1. Item from 1 to 23 are quarterly average using data points as shown in item 24. From the fourth quarter of the fiscal year ended March 31, 2017, the average daily value isdisclosed.
2. We do not apply the "exception regarding qualifying operational deposits" in Article 28 of the Notice No. 62 with respect to item 6.
3. The numbers in item 11 include the amount of additional collateral required due to market valuation changes on derivatives transactions estimated by the "historical lookback approach" instead of "scenario approach" in Article 37 of the Notice No. 62.
4. There are no material components that necessitate detailed explanation of "cash outflows from other contracts" in Article 59 of the Notice No. 62 within item 14, "cashoutflows from other contingent funding obligations" in Article 52 of the Notice No. 62 within item 15, "cash inflows from other contracts" in Article 72 of the Notice No. 62
within item 19.
5. Monthly data or quarterly data is used for some of the data, etc., concerning our consolidated subsidiaries.

311

Liquidity Coverage Ratio

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

2016

Consolidated LCR(quartely average)

2017

2018

Apr-Jun

Jul-Sep

Oct-Dec

Jan-MarApr-Jun

Jul-Sep

Oct-Dec

Jan-Mar135.1%

137.4%

135.3%

129.4%

129.7%

126.1%

124.8%

120.1%

Our Consolidated LCR surpasses the final regulatory standard (100%) and remains stable, with no change affecting funding
conditions.
LCR disclosed herein does not differ much from the level we expected beforehand, and we do not expect our Consolidated LCR in
the future to deviate significantly from the current level.
There are no significant changes in the composition, such as currency composition or type composition, and geographic
distribution of the HQLA allowed to be included in the calculation.
In addition, there is no significant currency mismatch which might affect our funding conditions between total amount of the HQLA
allowed to be included in the calculation and net cash outflow regarding significant currencies.

312

Liquidity Coverage Ratio

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory Disclosures

Status of Sound Management of Liquidity Risk

■ Status of Major Liquid Assets(Billions of yen)
Item

As of March 31, 2018 As of March 31, 2017

Cash and Due from Banks (including Due from Central Banks)
Trading Securities
Securities
Bonds Held to Maturity
Other Securities
Japanese Stocks
Japanese Bonds
Japanese Government Bonds
Japanese Local Government Bonds
Japanese Corporate Bonds
Other
Foreign Bonds
Other¥47,725.3
5,188.4
33,618.9
2,515.8
31,103.1
3,582.2
16,535.6
13,332.0
239.3
2,964.1
10,985.2
8,329.1
2,656.1

Total¥47,129.5
4,800.4
31,761.8
3,815.6
27,946.2
3,542.0
13,245.1
10,264.3
284.4
2,696.3
11,159.0
8,955.4
2,203.5

86,532.7

83,691.8

Portion pledged as collateral(11,660.9)(14,398.5)

Total after the deduction above¥74,871.7¥69,293.3

Notes: 1. All securities included in the above table have fair value.
2. Portion pledged as collateral mainly consists of securities and others collateralized for borrowed money, foreign and domestic exchange transactions or derivatives
transactions,or substituted for margins for futures transactions.
3. Figures in the above table do not represent high quality liquid assets under the Basel Ⅲ regulatory regime.

■ Status of Major Funding(Billions of yen)
As of March 31, 2018
Types of Financial Instruments

Within 1 year

1-3 years

3-5 years

5-7 years

Deposits
Negotiable Certificates of Deposit
Call Money and Bills Sold
Borrowed Money
Commercial Paper
Issued Bonds
Due to Trust Account¥121,278.4
11,021.7
2,105.2
2,221.5
362.1
740.9
4,733.1¥2,974.1
357.7
1,541.5
1,145.7-¥691.74.0
309.4
1,883.4
-

¥86.9
260.2
626.6
-

¥41.3
303.8
1,375.9
-

¥8.5
259.5
532.9
-

Total

¥142,463.2¥6,019.2¥2,888.7¥973.9¥1,721.0¥801.07-10 years Over 10 years(Billions of yen)

As of March 31, 2017
Types of Financial Instruments

Within 1 year

1-3 years

3-5 years

5-7 years

Deposits
Negotiable Certificates of Deposit
Call Money and Bills Sold
Borrowed Money
Commercial Paper
Issued Bonds
Due to Trust Account¥115,871.8
10,421.6
1,255.2
604.6
226.3
1,414.8
4,784.1¥3,334.2
150.6
3,095.1
1,486.1-¥696.760.1
1,542.0
1,331.4
-

¥73.1
338.6
564.0
-

¥60.5
377.8
1,401.0
-

¥9.0
305.0
588.9
-

Total

¥134,578.5¥8,066.0¥3,630.2¥975.8¥1,839.2¥902.97-10 years Over 10 years

Notes: 1. Regarding Deposits, Demand deposits are included in "Within 1 year"
2. Borrowed money or issued bonds with open ended, 44.0 billion, 779.0 billion, respectively, at March 31, 2017, and 0.0 billion, 1,239.0 billion, respectively, at March 31,
2018, are excluded.

313

Liquidity Coverage Ratio

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）

Basel Regulatory DisclosuresCompensation of Directors, Corporate Auditors and Employees■ Compensation of Directors, Corporate Auditors and Employees(1) Qualitative Disclosure(A) State of the Organizational System Relating to Compensation of "Subject Directors, Corporate Auditors andEmployees" of Mizuho Group
1. Scope of "Subject directors, corporate auditors and employees""Subject directors, etc." and "Subject employees, etc." subject to disclosure as provided for in the FSA Notice(collectively, "Subject directors, corporate auditors and employees") are as follows:(1) Scope of "Subject directors, etc.""Subject directors, etc." are directors and executive officers as defined in the Companies Act of Mizuho Financial
Group, Inc. ("MHFG"). Outside directors auditors are excluded.
(2) Scope of "Subject employees, etc.""Subject employees, etc." who are subject to disclosure are executive officers (as defined in our internal regulations),
specialist officers and employees of MHFG and directors, corporate auditors and employees of its "Major
consolidated subsidiaries", who are "persons who receive large amounts of compensation" and "materially affect theoperation of business or the state of assets of Mizuho group or its major consolidated subsidiaries."(a) Scope of "Major consolidated subsidiaries"
A "Major consolidated subsidiary" is a consolidated subsidiary, etc., (i) whose total assets as a percentage ofconsolidated total assets exceeds 2% of a bank holding company or bank and (ii) who materially affects the
management of our group. Specifically, those are Mizuho Bank, Ltd. ("MHBK"), Mizuho Bank (USA) and othersubsidiaries who conduct banking business similar to a branch of MHBK, Mizuho Trust & Banking Co., Ltd.
("MHTB"), Mizuho Securities Co., Ltd. ("MHSC"), Trust & Custody Services Bank, Ltd., Mizuho Securities USA
Inc. and Mizuho International Plc.
(b) Scope of "Persons who receive large amounts of compensation"
A "Person who receives large amounts of compensation" refers to a person who receives compensation thatexceeds the base amount from MHFG or its "Major consolidated subsidiaries." The base amount at MHFG has
been set at ¥50 million. Such base amount has been set based on the average amounts of the compensation of
directors, executive officers (as defined in the Companies Act) and corporate auditors of MHFG, MHBK and
MHTB for the last three fiscal years (excluding persons who resigned or retired during each of such fiscal years),
taking into account fluctuations in amounts of compensation over past fiscal years. The preceding base amount
has been adopted as the common base in order to unify the selection criteria of persons who receive large
amounts of compensation at each of the companies in this paragraph.
(c) Scope of "Persons who materially affect the operation of business or the state of assets of Mizuho group"
A "Person who materially affects the operation of business or the state of assets of Mizuho group" means aperson who exerts significant influence on the operation of the business of MHFG or a "Major consolidated
subsidiary" through his or her work in conducting transactions or management, or who materially affects the stateof assets by incurring losses on transactions. Specifically, it includes executive officers (as defined in our internal
regulations) and specialist officers of MHFG and directors, corporate auditors, executive officers (as defined in
our internal regulations), specialist officers and market department employees of "Major consolidated
subsidiaries."
2. Decisions on compensation of "Subject directors, corporate auditors and employees" and the name, composition andduties of the committee to supervise business execution and other major organizations relating to payment ofcompensation and other compensation, etc.
(1) State of maintaining and ensuring the Compensation Committee, etc.
MHFG is a Company with Three Committees, and has established the Compensation Committee as a statutory
committee.
The chairman of the statutory Compensation Committee shall be an outside director, and in principle its members
shall be appointed from among the outside directors (or at least non-executive directors) in order to ensure
objectivity and transparency in director and executive officer compensation. As of March 2018, all four members of
the Compensation Committee, including the chairman, were outside directors. The Compensation Committee shalldetermine the basic policy and compensation system for directors and executive officers of MHFG, MHBK, MHTB
and MHSC, determine the compensation for each individual director and executive officer (as defined in the
Companies Act) of MHFG, and exercise approval rights in MHFG for compensation for each individual director of
MHBK, MHTB and MHSC.
In addition, the president of each of MHBK, MHTB and MHSC determines the amount of compensation for each of
its executive officers and specialist officers.

314

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Basel Regulatory DisclosuresCompensation of Directors, Corporate Auditors and Employees(2) Decisions on compensation of "Subject employees, etc."
Matters relating to executive officers (as defined in our internal regulations) and specialist officers of MHFG anddirectors, executive officers (as defined in our internal regulations) and specialist officers of MHBK, MHTB and
MHSC are as set out in (1) State of maintaining and ensuring the Compensation Committee, etc.. With regard to thecompensation of directors of MHBK, MHTB and MHSC, it is determined through approval by the Compensation
Committee, pursuant to each statutory procedure for directors who are Audit & Supervisory Committee Members
and for directors who are not Audit & Supervisory Committee Members, and set within the scope of the total amountof compensation of directors resolved at the ordinary general meeting of shareholders.
With regard to the compensation of corporate auditors of MHBK, MHTB and MHSC, it is determined pursuant to
consultation among corporate auditors, including outside corporate auditors, and set within the scope of the total
amount of compensation of corporate auditors resolved at the ordinary general meeting of shareholders. The
compensation of subject employees, etc., is decided and paid in accordance with the salary and bonus systemestablished by MHFG and the "Major consolidated subsidiaries." Such system is designed and put into writing by thehuman resources departments of MHFG and the "Major consolidated subsidiaries" which are independent of
departments furthering business. In terms of the compensation of overseas employees, each overseas office oroperation determines its own compensation policy based on local laws and regulations as well as employment
relationships.
3. Total amount of compensation paid to members of the compensation committee and number of meetings held by theCompensation Committee
Number of meetings held
(April 2017 – March 2018)
Compensation Committee(MHFG)

9

Note: The total amount of compensation is not set out above as it is not possible to separately calculate the amounts that are paid as consideration for the execution of duties by thecompensation committee.

(B) Evaluating the Appropriateness of the Design and Operation of the System Relating to Compensation of"Subject Directors, Corporate Auditors and Employees" of Mizuho Group
1. Policies relating to compensation(1) Policies relating to compensation of "Subject directors, etc. "MHFG set out the “Mizuho Financial Group Compensation Policy” concerning the determination of compensation foreach individual director, executive officer and specialist officer (“Officers, etc.”) of MHFG as well as MHBK, MHTB
and MHSC (the “Three Core Companies”).
a. Philosophy and objectives
Executive compensation for MHFG and the Three Core Companies pursuant to such policy is determined based on
appropriate governance and control, and aims to function as incentive and compensation for each Officer, etc., toexercise their designated function to the fullest in our efforts to realize management that contributes to value creationfor various stakeholders and improve corporate value through continuous and stable corporate growth based on ourbasic management policies under our Corporate Identity.
b. Basic Policy
The basic policy with respect to the determination concerning the individual compensation of Officers, etc., of MHFG
and the Three Core Companies is set forth below:(i) The executive compensation shall be determined based on appropriate governance and control, and function as an
appropriate incentive in order to realize management that contributes to value creation for various stakeholders andimprove corporate value through continuous and stable corporate growth based on our basic management policies
under our Corporate Philosophy.
(ii) The executive compensation shall be based on the function and responsibility assigned to and the performance ofeach Officer, etc.
(iii) The executive compensation shall contribute to suppressing excessive risk-taking, improving corporate value andcreating value for various stakeholders not only in the short-term, but also over the medium- to long-term.
(iv) The executive compensation shall reflect the management environment and business performance of our group.
(v) The executive compensation shall enable compensation for securing expert personnel such as professionals witha competitive edge in the market.

315

Qualitative disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(vi) The compensation system and standards shall be timely and appropriately reevaluated and set at a competitive
and appropriate standard based on such factors as the economic and social conditions and survey data withrespect to management compensation provided by external specialized organizations.
(vii) Regulations and guidelines, etc., concerning executive compensation, both in Japan and overseas, shall becomplied with.
c. Compensation System
I. Compensation for Officers, etc., shall, in principle, consist of a “Basic Salary,” “Performance Payment” and “Stock
Compensation.”(i) “Basic Salaries” shall factor in the function and responsibility of each Officer, etc., in addition to the standard
amount for each position and payment will be made monthly in cash.
(ii) “Performance Payments” shall be made as a monetary incentive for Officers, etc., to achieve the annual budget
and as compensation for their achievement. The payment thereof shall reflect our company-wide results ofoperations, the results of organizations (our in-house companies and units, etc.) that each Officer, etc., is in chargeof and the performance or each Officer, etc., in addition to the standard amount for each position. A system shall be
adopted which, based on resolution by the Compensation Committee, etc., enables certain amount of deferredpayments of the performance payments over three years, as well as a decrease or forfeiture of the deferred amount
depending on performance, etc., of the company or the individual.
(iii) “Stock Compensation” shall be paid in the form of shares of common stock of MHFG consisting of “Stock
Compensation I” and “Stock Compensation II,” (together “Stock Compensation I and II”) acquired from the stock
market through a trust with an aim to align the interests of Officers, etc., with those of the shareholders andincrease the incentive to enhance corporate value.
(a) “Stock Compensation I” shall be paid at the time of retirement of each Officer, etc., in the form of shares ofcommon stock of MHFG calculated based on each position. A system shall be adopted which enables a decreaseor forfeiture of the amount by resolution of the Compensation Committee, etc., depending on performance of thecompany or the individual.
(b) “Stock Compensation II” shall be paid in accordance with our company-wide results of operations, the results oforganizations (our in-house companies and units, etc.) that each Officer, etc., is in charge of and the performanceof each Officer, etc., in addition to the standard amount for each position. A system shall be adopted whichenables the entire amount of deferred payments over three years, as well as a decrease or forfeiture of thedeferred amount by resolution of the Compensation Committee, etc., depending on performance of the company
or the individual.
II. Within the Officers, etc., the compensation system for the executive officers as defined in the Companies Act, thedirectors, the executive officers as defined in our internal regulations and the specialist officers responsible forbusiness execution (the "Officers Responsible for Business Execution") shall be separate from the compensation
system for the directors responsible for management supervision ("Non-Executive Officers Responsible forManagement Supervision").
(i) The basic compensation system for "Officers Responsible for Business Execution" shall be a “Basic Salary,”“Performance Payment” and “Stock Compensation I and II.”(a)The composition of the compensation shall, in principle, be 50%, 17.5% and 32.5% for “Basic Salary,”“Performance Payment” and “Stock Compensation I and II” respectively.
(b)“The upper limit of “Performance Payment” and “Stock Compensation II” shall be decided* in accordance with the
our annual results of operations taking into account the traits of business activities of MHFG as a Financial
Services Group. The payment to each officer shall reflect the performance of each officer and the results oforganizations (our in-house companies and units, etc.) that each Officer, etc., is in charge of, and be, in principle,
within the range of 0% to 150% of the standard amount for each position.
* The amount of funds for “Performance Payment” and “Stock Compensation II” is decided for each fiscal year bymultiplying the standard amount for each position in a respective year with the total number of officers in that year
and a coefficient based on the result from the fiscal year’s results of operations. The evaluation metric for thiscoefficient is decided by setting metrics based on our Consolidated Gross Profits, and using such evaluation
metrics for the reference year and the current fiscal year (provided that, for Mizuho Securities Co., Ltd., the system
is linked to Ordinary Profits, which is a metric that is equivalent to Consolidated Gross Profits based on the traits ofbusiness activities and financial structure of securities companies).
(ii) The compensation for Non-Executive Officers Responsible for Management Supervision, in principle, shall be in
the form of fixed compensation from the perspective of ensuring the effectiveness of the supervisory function. The
compensation system shall consist of “Basic Salaries” and “Stock Compensation” and the composition shall, in
principle, be 85% and 15% for “Basic Salaries” and “Stock Compensation,” respectively.

316

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Basel Regulatory DisclosuresCompensation of Directors, Corporate Auditors and Employees

III. There are cases where compensation for some personnel, including those officers recruited locally in countries
other than Japan, may be designed individually in compliance with local compensation regulations while taking into
consideration local compensation practices and the responsibilities, business characteristics and market value, etc.,
of each respective officer.
For cases where compensation is designed individually, payment of compensation is also made in accordance withthe performance of the company or the individual. Payment of compensation is designed to avoid excessive risktaking through a system which enables certain amount or a portion of deferred payments and non-monetary
payments such as stock, as well as a decrease or forfeiture of the deferred amount depending on the performance,
etc., of the company or the individual.
d. Compensation Determination Process
I. The Compensation Committee shall determine the determination policy of executive compensation for MHFG and
the Three Core Companies and the executive compensation system including the compensation system set out in“Compensation System” in order to effectively secure the transparency and objectivity of compensation, etc., forindividual Officers, etc. In addition, the Compensation Committee shall determine the compensation for eachindividual director and executive officer, as defined in the Companies Act, of MHFG and approve at MHFG thecompensation of each individual director of the Three Core Companies.
II. The President & CEO, pursuant to this policy and regulations and detailed rules, etc., shall determine thecompensation for each executive officer, as defined in our internal regulations, and specialist officer of MHFG andapprove at the MHFG the compensation of each individual executive officer and specialist officer of the Three Core
Companies.
III. The Compensation Committee will verify the validity of the compensation system and standards based on
economic and social conditions and survey data with respect to management compensation provided by external
specialized organizations.
IV. All members of the Compensation Committee shall be appointed from among outside directors (or at least nonexecutive directors) and the Chairman thereof shall be an outside director.
V. The Compensation Committee may have officers who are not members of the committee (including officers of theThree Core Companies) such as the President & CEO and external experts, etc., attend its meetings and provide
their opinion in order to facilitate adequate and appropriate discussions and determinations.
(2) Policies relating to compensation of "Subject employees, etc."
The policies relating to compensation for executive officers (as defined in our internal regulations) and specialist
officers of MHFG and directors, executive officers (as defined in our internal regulations) and specialist officers of
MHBK, MHTB and MHSC are also the same as the policies described in (1) Policies relating to compensation of"Subject directors, etc." above. The compensation of corporate auditors is determined pursuant to consultation
among corporate auditors, including outside corporate auditors, and set within the scope of the total amount ofcompensation of corporate auditors resolved at the ordinary general meeting of shareholders. Compensation forother employees, etc., is determined in accordance with their duties and responsibilities. Some bonuses that arelinked to performance are determined after comprehensively evaluating the employee’s contribution to business,
including any qualitative contributions to the organization, in a manner that does not place an excessive emphasis
on results.
2. The effect of the overall level of compensation, etc., on equity capital
The Compensation Committee of MHFG receives reports on the amount of compensation paid to directors, executive
officers (as defined in the Companies Act), executive officers (as defined in our internal regulations) and specialist
officers of MHFG, MHBK, MHTB and MHSC in the previous fiscal year and confirms that there is no material effect on
the Mizuho group’s performance or the adequacy of equity capital.

317

Qualitative disclosure2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(C) Compatibility between System for Compensation of "Subject Directors, Corporate Auditors and Employees"of Mizuho Group and Risk Management andMmatters Relating to Linking Compensation with Performance
1. Compatibility between system for compensation of "Subject directors, corporate auditors and employees" and risk
management
The compensation of employees in risk management department, compliance department and internal audit department
is decided in accordance with the salary and bonus system, and specific payment amounts are conclusively determinedin accordance with employee performance evaluations made by the relevant department and the human resources
department, independent from departments furthering business.
Each employee of the risk management department, the compliance department and the internal audit department sets
their own objectives in the employee performance evaluations, subject to the approval of their superiors. The degree towhich the objectives are achieved is evaluated by taking into account the degree of the employee's contribution to theestablishment of a system for risk management, compliance and internal audit.
2. Linking compensation of "Subject directors, corporate auditors and employees" with performance
The performance payments and performance-based stock compensation for "Officers Responsible for Business
Execution" are made or paid based on the standard amount set for each position, with which each officer’s performanceshall be reflected, and determined in accord with a performance evaluation, etc., against the annual business plan. A
certain amount of the performance payments and the entire amount of the performance-based stock compensation shallbe made or paid in deferred payments over three years, and a decrease or forfeiture of the deferred amount may bemade depending on the performance, etc., of the company and such officer. It should be noted that certain "Subject
directors, corporate auditors and employees" have entered into compensation-related contracts. Stock compensationfor "Non-Executive Officers Responsible for Management Supervision" shall be made in accordance with the standard
amount set for each position, and the payment level shall not change based on the performance of each officer. The
entire amount of the stock compensation shall be paid in deferred payments over three years, and a decrease orforfeiture of the deferred amount may be made depending on the performance, etc., of the company.

318

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Basel Regulatory DisclosuresCompensation of Directors, Corporate Auditors and Employees(2) Quantitative Disclosure Items(A) REM1：Compensation Assigned to the Relevant Fiscal Year

No.

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23

Number of “Subject directors, etc.” and “Subject employees, etc.”
Fixed compensation amount (3+5+7)
Cash compensation amount
Of which, deffered amountFixedcompensation
Stock compensation amount or stock-based type compensation amount
Of which, deffered amount
Other compensation amount
Of which, deffered amount
Number of “Subject directors, etc.” and “Subject employees, etc.”
Variable compensation amount (11+13+15)
Cash compensation amount
Of which, deffered amount
Variablecompensation
Stock compensation amount or stock-based type compensation amount
Of which, deffered amount
Other compensation amount
Of which, deffered amount
Number of “Subject directors, etc.” and “Subject employees, etc.”
Retirement
Retirement benefits amountbenefits
Of which, deffered amount
Number of “Subject directors, etc.” and “Subject employees, etc.”
Other
Other compensation amountcompensation
Of which, deffered amount
Comensation amount (2+10+18+21)(Millions of yen, except people)ab“Subjectdirectors, etc.”“Subject
employees, etc.”

22
¥976
937
37
37
1
20
¥490
246
6
244
244
¥¥¥1,467

378¥13,530
12,381
16
16
1,132
375
¥14,962
13,638
4,031
1,307
995
17
2
¥8
171
¥897
¥29,399

Notes: 1. Amounts of compensation of “Subject directors, etc.” include amounts of compensation received for duties performed as a director or executive officer of a "Major
consolidated subsidiary."
2. The number of employees is the actual number of persons (a) for the compensation for the fiscal year ended March 31, 2018 and (b) for the compensation for the fiscal year
ended March 31, 2017 for the payments made or anticipated payments for which the amount became clear during the fiscal year ended March 31, 2018 are stated.
3. The stated amount is the total amount for the fiscal year ended March 31, 2018 and the fiscal year ended March 31, 2017.
4. No. 7, “Fixed compensation,” “Other compensation amount,” includes condolence money insurance premiums and Group life insurance premium subsidies, both based on
the decision of our Compensation Committee.
5. No. 11, “Variable compensation” “Cash compensation amount,” includes the recorded performance payment for the fiscal year ended March 31, 2017 for directors,
executive officers (as defined in the Companies Act), executive officers (as defined in our internal regulations) and specialist officers of MHFG, MHBK, MHTB and MHSC.
For portions that exceed a certain amount, we plan to defer payment over the three-year period from the fiscal year ending March 31, 2019.
6. No. 13, “Variable compensation” “Stock compensation amount or stock-based type compensation amount” includes the amount obtained by multiplying the stockcompensation and performance-based stock compensation ownership points (with one point to be converted into one share of MHFG stock) granted to the directors,
executive officers (as defined in the Companies Act), executive officers (as defined in our internal regulations) and specialist officers of MHFG, MHBK, MHTB and MHSC for
the fiscal year ended March 31, 2017 by the book value of MHFG's shares (196.9447 yen per share). For stock compensation and performance-based stock compensation
for the fiscal year ended March 31, 2017, we plan to defer payment over the three-year period from the fiscal year ending March 31, 2019.
7. Because the amounts of the stock compensation, performance payment and performance-based-type stock compensation for the directors, executive officers (as defined in
the Companies Act), executive officers (as defined in our internal regulations) and specialist officers of MHFG, MHBK, MHTB and MHSC for the fiscal year ended March 31,2017 have not been determined at this time, they are not included in the above compensation. However, we have recorded the required reserves for accounting purposes.
8. The exercise periods for the stock compensation-type stock options (stock acquisition rights) are as set out below. Under the stock option agreements, exercise of theoptions is postponed, even during the exercise period, until the time of retirement of the director or employee.
[The exercise periods for stock options have been omitted from the table]

319

Quantitative Disclosure Items

2018/09/03 9:55:37 / 18439226_株式会社みずほフィナンシャルグループ_総会その他（Ｃ）(B) REM2：Special Compensation(Millions of yen, except people)abc“Subject directors, etc.”“Subject employees, etc.”

JPY

1

e

Lump sum payments
at the time of recruitment

Bonus guarantees
People

d

Peopl

¥127

Additional retirement benefits

JPY

3

f

Peopl

JPY

¥36

19

(C) REM3：Deferred Compensation(Millions of yen)
a

b

c

d

Of which, thedeferredcompensation
amount subject
to adjustment orvariation

Regardingcompensation
after allocation,
variable amounts
adjusted but notlinked tovariations for the
relevant fiscal
year

Regardingcompensation
after allocation,
variable amounts
adjusted andlinked tovariations for the
relevant fiscal
year

¥10

¥10

¥-

¥-

¥1

773

444

-

103

162

-

-

-

-

-

6,745

1,938

126

-

2,697

2,440

1,333

-

157

566

0

-

-

-

-

¥9,969¥3,727¥126¥260¥3,429Deferredcompensation
amountCashcompensation
amountStockcompensation“Subjectamount or stockdirectors,
based type
etc.”
compensation
amountOther
compensation
amountCashcompensation
amountStockcompensation“Subjectamount or stockemployees,
based type
etc.”
compensation
amountOther
compensation
amountTotal amount

¥813

e

Amount ofdeferredcompensation
paid in the
relavent fiscal
year(D) Other Relevant Matters Relating to Our System of Compensation for "Subject Directors, Corporate Auditorsand Employees" of Mizuho GroupNot applicable, other than those covered in the above.

320

Quantitative Disclosure Items

321

Disclosure Policy
1. Basic principles
We are committed to growing together with our customers
in a stable and sustainable manner and bringing together
our group–wide expertise to contribute to the prosperity of
economies and societies throughout the world as the leading
Japanese financial services group with a global presence
and a broad customer base. For this reason, we place one of
the highest management priorities on continuing to disclose
information to our customers, shareholders, and investors bothin and outside Japan in a fair, timely and appropriate manner,in order that they may form proper judgments and appraisalsof the group. To achieve this aim, we observe applicable
domestic and international laws and regulations as well as
stock exchange rules relating to corporate disclosure, and weestablish and implement appropriate Disclosure Controls andProcedures.
2. Disclosure Controls and Procedures(1) Establishment and implementation of Disclosure Controls
and Procedures
Our Disclosure Controls and Procedures are establishedto observe applicable domestic and international laws andregulations as well as stock exchange rules and to implement
fair, timely and appropriate corporate disclosure. The
Disclosure Controls and Procedures are the process carriedout by directors, officers and employees of Mizuho Financial
Group and include Internal Controls over Financial Reporting
designed to provide reasonable assurance regarding
the reliability of Financial Reporting and the Preparationof Financial Statements. We have established the basic
principles underlying our Disclosure Controls and Procedures
as well as our internal rules related to Disclosure Controls andProcedures that govern the management framework for theentire Mizuho Financial Group including group companies,
and we endeavor to establish, implement and continuously
improve our Disclosure Controls and Procedures. Our
Disclosure Committee is the Business Policy Committeethat is responsible for discussing and coordinating mattersrelating to Disclosure Controls and Procedures.
(2) Evaluation of effectiveness of Disclosure Controls andProcedures
Our Disclosure Controls and Procedures are documented,
and evaluation of the overall effectiveness of our Disclosure
Controls and Procedures is conducted regularly byreviewing the contents of such documentation and theirimplementation. In addition, evaluation of the effectivenessand appropriateness of Disclosure Controls and Proceduresis conducted through internal audits.
(3) Others
We established a “Code of Ethics for Financial Professionals”
to be observed by all directors and executive officers, as well
as all managers and other employees within Mizuho Financial
Group who engage in financial reporting, accounting or
disclosure. We have also developed the “internal control andaudit hotline”, a system designed for reporting questionableaccounting, internal control, or auditing matters from both
inside and outside Mizuho Financial Group.

laws and regulations as well as stock exchange rules, wefollow the defined disclosure procedures such as publishingsuch information in business reports (Jigyo–Hokoku),
annual securities reports (Yukashoken–Hokokusho),Integrated Report (Annual Review) and other disclosure
publications, as well as providing such information throughthe information distribution systems of domestic andinternational stock exchanges and through press releases.
We also endeavor to disclose other information in a fair,timely and appropriate manner. When we disclose suchinformation, we basically publish on our website theinformation we disclose. In addition, we endeavor to utilize
the latest disclosure methods and tools to provide more fair
and widespread disclosure.
(2) Investor relations activities
Investor relations activities to market participants both inand outside Japan such as shareholders, investors andsecurities analysts are conducted by the President & Group
CEO, Group CFO, Chief IR Officer, and executives andemployees designated by them. In accordance with ourbasic principles described in section 1 above, and with due
attention to two–way communication, we endeavor sincerely
to facilitate a proper understanding of our management
strategies, financial condition and other matters. In thisway, we aim to earn the trust of the market and obtain an
appropriate market reputation.
Beginning with the disclosure required by applicable
domestic and international laws and regulations aswell as stock exchange rules, we endeavor to grasp
properly the types of information desired by the market
and to disclose useful and appropriate information
voluntarily and proactively, in accordance with the socalled Fair Disclosure Rule (“FDR”). Regarding disclosureof information we consider particularly important, we
communicate such information on an ad hoc basis as andwhen necessary, even if a press release has already been
issued, through such means as special briefing sessions.
In addition, we respect various disclosure principles
including fair disclosure. Accordingly, at individual calls,
private meetings or conferences hosted or attended byrepresentatives of Mizuho Financial Group we endeavor tolimit carefully our explanations to matters already disclosed
and facts commonly known.
Should we happen to disclose important information suchas information subject to insider trading regulations and/or
undisclosed financial results that might have a significant
influence on stock prices, we endeavor to take necessary
action such as officially announcing the information as soon
as possible, in accordance with FDR.
(3) Correction of misconceptions in the markets
If we identify significant misconceptions regarding Mizuho
Financial Group in the market due to the spread of rumors
or otherwise, we endeavor to investigate their causes andcorrect such misconceptions promptly.

3. Disclosure methods, other(1) Disclosure methods
With respect to the information which is required to bedisclosed pursuant to applicable domestic and international

2018 Integrated Report322

Mizuho Financial Group, Inc.
1-5-5 Otemachi, Chiyoda-ku, Tokyo 100-8176, Japan
www.mizuho-fg.com

This PDF version of the Integrated Report is a digital version of the Forest StewardshipCouncil (FSC)-certified published version, which is printed on FSC-certified paper.